(1) THEGOVERNMENTOFTHEREPUBLICOFZAMBIAzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA and (2) NETAJ!RICAMWINGPLC and (3) CHINANONF'ERROUSMETALINDUSTRY'S FOREIGN ENGINJBXINGzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAAND CONSTRUCI'ION CORFORATION (GROUP) aIAMB1sHIMINE DEVELOPMENTAGREEMENT CLIFmRDcHANCE 200 AldersgateStreet LondonEClA4JJ 'M: 0171 600 10CKl hx: 01716005555 M VCH/G2181/030MWC CONTENTSzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA PARTA GENERAL 1. monsandInterpretations .................................... 3 PARTB OPEIUTIONALANDE"ENT ISSUES 2. Obligationsto Develop .......................................... 10 3. RightstoExportandImportandArms'Im@hDedhgs ................... 10 4. Pmmrement ................................................ 11 5. Local Business Development ...................................... 12 6. TrrgandHumanResourcesManagement ........................... 13 7. Insurance! .................................................. 15 8. Suspensionof Production ........................................ 15 9. !?dalAssets ................................................ 17 10. Recordsand OperatingReports .................................... 19 PART C UNDERTAKINGSNECESSARYFOROPERATIONS 11. Foreign Exchange ............................................. 21 12. Environmental Issues .......................................... 23 PART D TAXATION 13. General Obligation toFay 'hx .................................... 28 14. CJarikation of 'Ihxation Legislation ................................. 28 15. Taxation Stability ............................................. 28 PARTE FORMALCLAUSES l 16. at -k ................................................. 30 17.zyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAExtemdonstoTime .......................................... 32 18. 'lkmination ................................................ 32 19. ArbitxdonandSoleExpert ...................................... 35 20. Law Applicable .............................................. 38 21. ForceMajeure ............................................... 38 22 Variation. .................................................. 39 23 Consultation. ................................................ 40 24 Notices. .................................................... 41 25. Waiver .................................................... 42 26. severability ................................................. 42 27. MerActs ................................................ 42 28. Counterparts ................................................ 42 29. Representations and Warranties ................................... 42 SCHEDULE1 ................................................... 45 APPROVED PROGRAMME OF MINING OPERATIONS !3CHEDULE2 ................................................... 48 PART1 ENVIRONMENTAL PLAN PART2 ENVIRONMENTAL CLEAN UP OBLIGATIONS scmmJLE3................................................... 52 PART1 CONTRAmAREA PARTII MINING AREA SCHEDULE4 ................................................... 54 'RAININGANDHUMAN RESOURCES MANAGEMENT PROGRAMME SCHEDULES ................................................... 56 LOCALBUSINESS DEVELOPMENTPROGRAMh4E SCHEDULE6 ................................................... 58 REQUIREDINSURANCESzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA !xEEDuLE7 ...................................................... 59 PART1 MEDICALSERVICES PARTII EDUCATIONSERVICES PrnIII RJ3XEATIONALSERVICES PARTIV MUNICIPALDFRASTRUCIVR4L SERVICES THEAGREEMENTismadeon2?~NE,1998 BETWEEN: (1) THEGOWRNMENTOFTHEREPUBLICOFzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAZAMBIA, acting through the Minister of Mmcs and h4inerals Development and the Minister ofzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAFinance and Economic Dmelopmnt("GRZ");and (2) NM:AFRKA MINING PLC, a company incorporated in the Republic of Zambia (registered no. 40172). whose registered office is at Amandra House, Ben Bella Road, PO Box 34550, Lusaka, Zambia (WFCA") and who shall include any permitted assigns or suxessorsof the rights and obligations of NFCA; and (3) CHINA NONFERROUS METAL INJXBTRY'S FOREIGN ENGINEERING AND CONSTRUCTION CORPORATION (GROUP),acompany incorporated in ThePeoples' Republic of China registered no. 1OOOOO1002491(4-1), whose registered office is at 12B Fuxing Fbad, Bcijing, Peoples' kpublic of China ("ChhNonferrous")and who shall include any permitted assigns or successors of the rights and obligations of China Nonkrrous. WHEREAS: Proposals have been submitted on behalf of NFCA by China Nonfkrous fixthe acquisition, development and operation of the Chambishi Mine and orebody in the Copperbelt Province of Zambia (the development and operation of such large scale mining operation hereinafter referred to as the "Project"), the location of which is more specifically identified by refkrence to the plans annexed hereto at Schedule 3; GRZ has approved these proposals which are hereinafter rekrred to as the "Approved Programme of Mmng Operations", until the approval by GRZ of a revised programme of mining operations pursuant to Clause 2.4hereof; The development and large scale exploitation of the Project will be of major economic significance to the people of Zambia; GRZwishes to ensure that the development and large scale exploitation of the mine and orebody at Chambishi will secure the maximum benefit for, and adequately contribute to the advancement and the social and economic welfare of, the people of Zambia, including the people in the vicinity of the Contract Amin a manner consistent with their needs and the protection of the environment and which secures an appropriate return on investment commensuratewiththe risks involwxi to NFCA; GRZ, NFCA and China Nonkrrous have agreed on a number of matters which are setout in this Agreement and wish the matters agreed upon to be an enduring arrangement of national interest; GRZ has granted to the Minister of Mines and Minerals Development and the Minister of Finance statutory authority under Section 9 of the Act to enter into, his Agreement on - 1- relating thaeto. The h4inism has sought and rcceived the advice of the Mining Advisory Committeemaccordancewith Section88of the Act and iszyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAacting m accordance with such advice;and m G=, NFCA, ZCCM and China Nonhous have entered into a Sale and Pwhase A-t dated2’43p~E.1998which requireson its defined) the entry mm ofzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAthis Agreement. -2- approvedby the Ministry (and appended to the Large Scale Mining Licences pursuant to Section Z(4) of the Act) and which is set out inSchedule 1hereto; "Arms'LengthzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA"ems" means a transaction where: (a) the parties m negotiating the tmsaction have sought to promote their mbest mtcrestsmzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAaccordance with hir and honest business methods; (b) the consideration expressed in the agreement for the transaction entered into is the only consideration fixthe transaction; (c) the price and other terms of the transaction have not been affected by, nor determined as a consequence of,zyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAany other agreement or any direct or indirect relationship (other than the relationship created by the transaction agreement betwem the selling parry or shareholders of the selling party, or a company in which the selling party is a shareholder, and buying party or shareholders of the buying party, or a company m which the buying party is a shareholder);and (d) neither the selling party, nor any person or company connected with it thmugh shareholding or otherwise, has any direct or indirect interest in the: subsequent disposal, if applicable, by the buying party of any of the products or services obtained pursuant to the transaction agreement; "Assets" means all the property and assets to be transferred by ZCCM to NFCA pursuant to the provisions of the Sale and Purchase Agreement as are more particularly described therein; "BusinessDaft means a day other than a Saturday or Sunday upon which banks are open for business in London, Beijing, Dublin, Toronto and Lusaka; "CentralBank" means the Bank of Zambia; "CollectiveAgreements" means the Standard Conditions of Empkyment and Service as agreed between ZCCM and the Mineworkers Union of Zambia in effect at the date of Completionof tieSaleand PurchaseAgreement (which for the avoidance of doubt includes the Standard Code Book, the Disciplinary Code Book, the 1981 Joint Job Evaluation Agreement and the 1997 Redundancy Agreement), as these mybe renegotiated by NFCA from tirm to time following the expiry thereof; "Commencement of Normal Operations"means the last day of the first period of thirty (30) consaxthe days in which production of contained copper in concentrate from the Project exceeds sixty per cent. (60%) of the monthly production of contained copper in concentrate projected in the Approved Programme of Mining Operations for the period immediately fbllowing four (4)years after Completion; "CompaniesAct"meansthe Zambian Companies Act, Chapter 388 of the hof Zambia as from time totime amended and in effect; -4- PARTA GENERAL 1. Dduitions andInterpretations 1.1 hthisAgreement, unless the context otherwise requires: ttActtlmeans tie Zambian Mmes and Minerals Act, Chapter 213 of the Laws of Zambia as fromtimeto time amended and in effect; NMiliate+AtlUated hrty, or AfIiliatcdParties" means: (a) any person m which NFCA or a Shareholder (as the case may be) holds twenty per cent. (20%) or more of the ordinary voting shares or which holds twenty per cent. (20%)or more of NFU3ora Shareholder's (as the case may be) ordinary shares; (b)zyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAany person which, dinxtly or mdirectly, is Coxmdlexi by or Controls, or is under Common Control with NFCA or a Shareholder (as the case may be); or (c) any person or group of persons beiidirectors or executive officers of, or m the employment of, any person referred to m (i) or (ii) above; and "Control"means: (a) the power (whether directly or indirectly) and whether by the ownership of share capital, the possession of voting power, contract or otherwise to appoint antior remove all or such of the board of directors or other governing body of a person as are able to cast a majority of the votes capable of being cast by the members of that board as a body, or otherwise to control or have power to control the policies and affairs of that person; antior (b) the holding andor the ownership of the beneficial interests in and/or the ability to exercisethe voting rights applicable to sharesor other securities in any person which conkm aggregate on the holders whether directly or by means of holding such mmests m one or more other persons (either directly or indimtly) more than fifty per cent. (50%)of the voting rights exexcisableat general meetings of that person, and "Controlledby" shall be construed accordingly and "Common Control"means the circ~tanceswhere tm(2) or more persons are controlled by the same person or its Affiliates; clAgreementttmeans this agreement as varied from time to time in accordance with the terms hereot "Approved hgrammeof Mining Operations"means the proposals for developing and opexatingthe Facilities submitted on behalf of NFCA by China Non5xrous which have been - 3 - nCompldion"haszyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAtbc meaning ascribed to it m the Sale and hrcha!x Agmmnt; Q.. "ContractArea" manstitland amcovered by the Leases, as descriklinSchedulezyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA3 Rart I; nCopperbdt"means CoppcrbdtPmvince m Zambia comprising the main copper mining areasinambia; "Coststo Resume Operations"means 1.2 ( one and two-tenths) times the costs (which includes the cost of new capital expenditures) required to nmmeNodOperations plus 1.2 (one and tw-tenths) times the sum of NFCA estimate of: 00 royalties; (b) OperatingCosts; and (c) all other incidental costs, necessary to continue Normal Operations fixa furtherperiod of melw(12) months; "DirectoPmeans the Director of Mines appointed under Section 83 of the Act; "Distributable Profits" means accumulated after tax profits and reserves of NFCA, available for distributionas dividends in accordance with Section84 of the CompaniesAct, as shamin the financial statements of NFCA; "EducationServices" means the education services set out in Schedule7, Part 11; "EffectiveDate" means the date on which this Agreement was executed by the Parties, and in the event that it was cxecuted by different Parties on different dates means the date on which it was executedby thezyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAPartywho was the last htyto execute the same; %mironmental Clean Up Obligations" means those obligations more particularly described in the document set out in Schedule 2, part 11; Tnviromental Laws" means the Mining (Mineral Resource Extractions) Regulations, 1994 (SI 119/1994); the Environmental Protection and Pollution Control Act, Chapter 204 of the Laws of Zambia and regulations enacted thereunder; and Sections 75 to 82 of the Mines and Minerals Act, Chapter 213 of the Laws of Zambia and the Mines and Minerals (Environmcntal) Regulations, 1997. save for the provisions contained meach of such laws and regulations which rdaeto mine safety andor the sakty of persons rather than to the protection of the environmemt,aszyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAeach may from time to time be amended and in effect; "EnvironmentalPlan"means the programme for environmental clean-up and protection and, where applicable, the proposals to bringNFCA into compliance with the Environmental hwith whichitisnotincomplianceasatthe Effectiw Date asapproved by the Minister fix the purposes of Section25(l)(d) and 76(2) of the Act (and appended to the Large Scale Mining Licences pursuant toSection25(4)of the Act) appearingasSchedule2 Part I hereto; 4y -5- nEnviromnentalProtectionFund" meanszyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAthe fund set up for envimnrncntai protection by Section 82 of the Act and thezyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAMines and Mmerals (Envimmnmtal) Regulations, 1997 (SI29m97); "Facilities" the mine and concentratorand associated facilities at Chmbishi; "ForceMajeure"has the meaging given to the term in Clause 21; "GRZ"rmans the Government of the Republic of Zambia and includes myauthorised agent of the Government of the Republic of Zambia; "IDF"means the ImportDeclarationFee; %vestment Commitmedlmeans the expenditure required to develop the Mine to achieve production levels of between five thousand two hundd and fifty (5,250) and six thousand (6,000)tonnes of ore per day within fotu (4) years of the date hereof, such expenditure is currentlyestimatedto be seventy million United States dollars (US$7OJKM,OOO); "Kwacha"meansthe lawful currency of Zambia; lTaqgeScaleMiningLicences" means large scale mining licences numbers 27, 28 and 29 held by NFUpursuantto the Act; "Leases" meansthe leases set out in the Sale and Purchase Agreement; "Local Business Development Programme" means the programme for local business development which is described in Clause 5 and which is set out in Schedule 5; "MedicalServices" means the medical services as set out in Schedule7, krtI; meansthe Chambishi mine and associated assetsasthe same aredescribed in Clause 2.1 of the Sale and Purchase Agreement; "MineProducts"meanstheores, concentratesorminerals produced fromthe Mining Area; WinenWmeansall minerals excluding petroleum and other hydrocarbons, as tie same mybelocated mthe Contract Area; "Ministry11mxm the Ministry of Mines and Minerals Development or other successor ministry from time to time;zyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA "Midng"has the meaning given to the term in the Act and, fix the purpose of this Agreement, includes all smelting and treatment operations associated with and beneficial thereto; WiningAmPmeansthe area ccwered by the Large Scale Mining Licences as the same is set out m Schedule3, part II; -6- "MmiapalzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAhhstmctural Semid' mean^ the ti~ipdinfh~tructuralservices as set out m Schedule 7, Part W, "MUZ"meanstheMirkrs'Unionof Zambia;zyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA "Normal operations" means the comnmcial operation of the hject fokwing the Commmcenmt of Normal Operaaons carried on m accordance with the Approved F%ogrammc of Mining Operations; "Notices"meanszyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAany notice, consent, demand, approval or other communication required or pemtted mbe given under Clause 24; "OperatingCosts" for any period following the Commencement of Normal Operations meansthecosts incurred by NFCA during Normal Operations excluding (a) depreciation and other non-cash costs (b) capital costs other than replacement capital costs and (c) financing charges; "Rwties" mans the personswho are for tie time being original parties to this Agreement or parties added or substituted pursuant to Clause 16;Tmject" has the meaning ascribed to it m Recital 1hereof; lQuarter";means: (a) January, February, and March; or (b) April, May and June; or (c) July, August and September; or (d) October, November and December; "RecreationalServices"means the recreational services as the same are listed in Schedule 7. h-tm; We&tered Dependants" means the dependants of employees who, at the date of this Agreement, are registered and thereafter those that shall be registered in accordance with Clause 9.1, m the records of ZCCM as being entitled to use some or all of the Third party Social Assets. The definition of Registered Dependant shall be any spouse of any employee and any employee's childm(including legally adopted children); "Rural EktrikationLevy" means the levy chargeable on sales of electricity under the Customs and ExciseAct, Chapter 322 of the Laws of Zambia as amended and currently set at ten per cent (10%); "Sale andzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAPurcbaw Agreement" mans the agreement for the sale and purchase of the Assets dated&hE1998 and made between ZCCM, NFCA, China Nonferrous and GRZ; Ykheduled Programmes" means the Approved Programme of Mining Operations, the Environmental Plan, the Emironmental Clean Up Obligations, the Training and Human Management Programme and the LodBusiness Development Programme; Resou~~~s -7- 9hareholdePmans a holder of ordinary shares m NFCA or the holder of the Special SharewhoserightszyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAarc set out m NFCA's Articles of Association; 'Shareholders' Agreement" means the agreement of even date herewith amongst certain Shareholdersin NFCA, governingthe relationship between them as Shareholders in NFCA; "SocialServices" means thezyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAMcdkal Services, Educational Services, Recreational Services and Municipal hfrasauctural Services;zyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA %ochl ServicesAccess Agreement" means the agnmnentconcluded between ZCCM and NFCA of even date with this Agreement affording (on the terms and conditions therein containcd) employees of NFCA and certain of their dependants access to the Third Party Social Assets of ZCCM; %lezyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAJZxpexV meansaperson appointed pursuant toClauses 3.3(c). 5.4, 6.4.7.3.8.8.9.4, 12.4, 12.5, 12.8, 15.l(d), 16.5@), 16.7, 18.6(c), 22.2@) and 22.4(d) of this Agreement and, in the event the parties m dspute fail to agree on the person to be so appointed, shall be appomted by the Secretary-Gen~ralforthe time being of the international Centre for the Settlementof Investment Disputes (ICSID). For the purposes of this agreement, the Sole Expert shall not be, or have been an employee of GRZ or NFCA or any Shareholder or any of their respective Affiliates or any authority or corporation of GRZ; lSpeculativeCurrencyTransaction"means a transaction involving the purchase or sale of Zambian currency, the primary object of which is the making of a profit on the exchange of currency but does not include the taking out of forward cover against reasonably predictable incomes or costs; Third Party Social Assets"means the Medical Services, the Education Servicesand tie Recreational Services which were available to the employees of NFCA and their dependants prior to the Completion of the Sale and Purchase Agreement but which are to be provided by NFCA pursuant tothe Social Services Access Agreement; ""&gand Human Resources Management Programme" means the programme fomngSchedule4hereto as approved by the Minister for the purposes of Section25(l)(e) of the Act (and appended to the Large Scale Mining Licences pursuant to Section 25(4)of the Act); WW,"USdollars"or"UmtedStates dollars"mans the lawful currency of the United States of America; TAT"means value added taxpayable under the Vdue Added Tax Act, Chapter 331 of the Lawsof Zambia as from time to time amended and in effect; %mbm" mans the Republic of Zambia; "ZCCM"meansZambia Consolidated CopperMines Limited; 1.2 hthis Agrement, unless the context otherwise requires: qv (a) ~~taryrdkrences arc nfirmce~to United Sratcs dollars unless otherwisezyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA q&6dy expresed; (b) the headings do not afkct tie mtrrpretationor construction; (c) rckrmccsto m Actincludes the amendments to that Act fixthe time being in hrce and also toany Act passed msubstitution therefixand any regulations for tie time being m hrce thereunder; (d) words importing tie singular include tie plural and vice versa; (e) words importing mygender include tie other gender; (0 reiixences to a person include a partnership, firm or corporation and any instrumentalityof GRZ or any political subdivision thereof; and (g) tie recitals form part of this Agreement. $f -9- PARTB A OPERATIONALzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAAND E"ENTzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAISUES R* 2. ObligationstoDevelop 2.1 NFCA shall, followingthe date on which the Large Scale Mining Licences are granted to NFCA and, subject to the terms of the Act, regulations made thereunder, the Large Scale Mining Licences and this Agreement, implement the Approved Programme of Mining Operationsin accordancewith thetimetable contained therein and good international mining and metal treatment standards and practices. 2.2 Without prejudice to the obligation contained in Clause 2.1, NFCA shall (and China Nonkrous shall procure that NFCA shall) carry out the Investment Commitment substantially in the manner, on the terms and mtie amounts set out in the Scheduled ProgriUMllS. 2.3 Subject m all cases to the provisions of this Agreement, GRZ hereby acknowkdgcs its agreement to the Scheduled Programmes and the complianceof the Scheduled Programmes with Section 24(3) of the Act and further acknwkxiges that the Scheduled Programmes comply with Section Z(1)of the Act. 2.4 GRZconfirms that it considers the proposedmining and treatment practices described in the Approved Programme of MmngOperationsnot to constitute "wzsf@d mining pmctices" for tie purposes of Section 81 of the Act. This confirmation is without prejudice to the rights of the Director of Mining Safety (acting on behalf of GRZ) to determine that mining practices not specifically rekrred to in the Approved Progmnme of Mining Operations constitute wastefulmining practices lix the purposes of Section 81 of the Act. Nothing in this Clause 2.4 shall prevent or restrict or otherwise limit GRZ from taking all actions within its power to protect public health and sakty. 3. Rights to Fxport and Import and Arms' Length Dealings 3.1 Subject to Clause 4 and the payment of applicable duties and taxes not otherwise exempted or deferred pursuant to this Agreement, NFCA may import and where it so desires, re- export without further rehence toGRZ, materials, equipment and services to be used m implementing the Scheduled Programmes provided that GRZ has not notified NFCA that the import andor reaport (asapplicable)of such materials and equipment vmdd give rise to the matters speciikd m Clause 3.2(b)(i) or (ii). 3.2 NFCA may market and export withoutfurtherrdixence to GRZ all Mine products and shall have sole control and management of sale of such Mine Products, including the hward selling of such Mine Products, and shall assume all risks therefor, provided that: (a) NFCA sellsits products on Arms' Length Terms; (b) GRZhasnot notified NFCA that the export of the Mine Products vmuld: Ay - 10- (i) breach m obligation of GRZ arising under mtemational law (includingzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA mandatorysanctionsimposed by the UmtiNations);or (ii) result in dealing or contracting with nationals of a state with which GRZ is in a state of declared or undeclared war; (c) mamfacturersof pmccsscdmdsem-processed goods involving copper content with processing facilities located m Zambia which are willing and able to purchase copper cathode at currently prevailing international market prices payable in US dollars to NFCA's account outside Zambia shall be afforded a preference over manufacturers whose processing facilitieszyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAare not so located Provided that this obligation shall only apply to an amount of copper which does not exceed ten per cent. (10%)of NFCA's annual production from time to time; and (d) no order has been made by the Minister pursuant to Section 69of the Act. 3.3 NFCA shall advise GRZ of each agreement concerning sales or processing of Mine Products, patent licensing, engineering, construction or management services which is entered into with an Affiliate. Copies of such agreements shall be copied to GRZ fixthwith upon execution. If, m the opinion of GRZ, any such agreement is not on Am'Length may, within thirty days (30) of receipt of such agreement, give notice to Terms, GRZzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA NFCA of the terms which GRZ considers to be Arms' Length Terms. Upon receipt of GWsnotice NFCA - (a) may terminate the agreement; or (b) may renegotiate the agreement using the terms considered arms' length by GRZ; or (c) if NFCA disagreeswith the terms so considered by GRZ, it myrekr the dispute to a Sole Expert in accordance within Clause 19 for a determination as to what are Arms' Length Terms. Upon receipt of tie Sole Expert's determination NFCA shall renegotiate the agreement, if necessary, toembody those temm decided by the Sole Expert to be Arms' Length Terms or terminate the agreement. 4. Procurement 4.1 NFCA. on an annual basis, shall identify and invite registration of businesses in Zambia (particularly in tie Copperbelt and with particular emphasis on businesses directly or indirectly majority owned by Zambian citizens) which are capable of supplying materials, equipment and services to NFCA. 4.2 Where materials, equipment and services required fixthe implementation of the Scheduled Programmes are manufactured or substantially assembled (or in - 11- procurable) within Zambia fiom ~US~~CSS(CS)pnqualifkd pux'suant to Clause 4.1, such businesses shall haw thezyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAopportunity to tender and if a tender submission from such businesses: (i) meets the specificationsof the inviration to tender; (ii) is competitivein cost with international sourccs; (iii) meets the delivery requirements of the Project, then the Company shall not discriminate against such businesses in its award ofsuch tender. 4.3 hassessing the tenders from local contractors and suppliers, NFCA will considerthe extra costs it would incur if it was to grant the contract to a foreign supplieror contractor. These extra costs shall include, butzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAare not necessarily restricted to, wharfige costs, shipping costs, stevedoring costs, custom clearance costs, custom duties, and demurrage charges. 4.4 NFCAshalladviseGRZof each such agreement for thesupplyof goodsand serviceswhere tie counterparty is an Affiliate in which event tieprovisions of Clause 3.3 (otherzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAthan tie first sentence) shall apply mumrismumdis. 5. Local Business Development 5.1 NFCA shall: (a) comply with the Local Business Development Programme so as to encourage and assist the establishmentof businesses within Zambia (particularly in the Copperbelt and with a particular emphasis on businesses directlyor indirectly majority owned by Zambian citizens) to supply materials, equipment and services to NFCA, provided that NFCA shall not be obliged to grant or lend money to any person or orgauisation; (b) conduct an annual review of progress being made on the implementation of the Local Business Development Programme and makesuch variations to itas required by changing circumtances; and (c) employ full-time staff experienced in setting up and managing small business enterprises: to assist Zambian citizens who wish to or have set up businesses to service NFCA and the Project; to assist in tie implementation of the Lmxl Business Development Programme and variations thereof; to liaise with tie appropriate officialsfrom GRZ;zyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA to compile and maintain the register re!kred to m Clause 4.1;and - 12- T (v) topmvideadviceand assistancem the ddopmcntand implementation of long-term business entqrises which can continue after the Approved Programme of Mining Operations is completed. 5.2 NFCA may, with the consent ofGRZ (which consent shall not be unreasonably withheld). aumdor alter the Local BusinessDmlopment Programme, with a view to securing the maximumbenefit to the establishnxntof Zambian businesses from the Fkilities. If NFCA is unablezyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAto comply with some or all of the Local Business Development Programme as a result of (a) circumstances or events bqmd its control; or (b) a direction of the Director of Mine Sakty under tie Act (or regulations made thereunder), then such non-compliance shall not constitute a default under this Clause 5 and NFCA may give notice of alternative or revised plans for the Local Business and hloprnent prog-. 5.3 Should NFCA give notice pursuant to Clause 5.2 (a) or (b), GRZ shall within thirty days (30)either: (a) approve those alternative or revised plans, or (b) meetwith NFCA to discuss and agree upon the alternative or revised plans. 5.4 If the discussions under Clause 5.3 do not lead to GRZ’s approval of alternative or revised plans and NFCA considers GRZ’s decision to be unreasonable, NFCA myelect to rekr the reasonableness of GRZ’s decision to a Sole Expert in accordance with Clause 19. 5.5 If the Sole Expert determines that GRZ’s decision is not unreasonable, he shall identify to NFCA the changes tothe Local Business and Development Programme as will benecessary to bring such programme into compliance with GRZ’s requirements in this regard. Howwer, if the Sole Expert detemes that GRZ’s decision is unreasonable, he shall declarehis determination to both parties and the proposed amendment or alternation to the Local Business and Development Prognmune shall bedeemed approved. 6. “ningandHumanResourcesManagement 6.1 NFCA will comply with the Training and Human Resources Management Programme applicable from time to time. 6.2 NFCA may, with the consent of GRZ (which consent shall not be unreasonably withheld), amend oralter the Training and HumanResources Management Programme applicable from time to time, with a view to securing the maximum mining of and benefits to Zambian citizens from tie Project. If the Training and HumResources Management Programme is disrupted by: - 13- l kzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA (a) c- or events which make it difiidt or impossible for NFCA to comply with its obligations under the Training and Human Rcsources ManagementzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAProgramn~;or (b) a directionzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAof the Director of Mine Safkty under the ~ct(or rrgulations made thereunder), give notice of alternativeor revised plans to the part of the Training and Human Resources Management Programme affected. 6.3 Should NFCA give notice pursuant to Clause 6.2 (a) or (b), Gmshall within thirty (30) dayseitier- (a) apprmthose ahmatkorrevised plans, or (b) meet withNFCAto discuss and agree upontiealternativeorrevised plans. 6.4 If the discussions under Clause 6.3 do not lead to GRZsapproval of alternativeor revised plans and NFCA considers GRZ’s decision to be unreasonable, NFCA may elect to rekrzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA the matter to a Sole Expert in accordance with Clause 19. h reaching its decision the Sole Expert shall judge the reasonablenessof GRZ’s decision. Ifthe SoleExpert detemnes that GRZ’s decision is not unreasonable, he shall identifytoNFCA the changes to the Training and Human Resources Management Programme as will be necessary to bring such programme into compliance with GRZsrequirements in this regard. However, if the Sole Expert detemnes that GRZs decision is unreasonable, he shall declare his determination to both parties and the proposed amendment or alternation to the Training and Human Resources Management Programme shall be deemed appmed. 6.5 NFCA shall not, save as provided below, be restricted in its employment, selection, assignment or discharge of personnel; provided, however, that the employment and the terms and conditions of such employment and the discharge or disciplining of personnel within Zambia shallbecarriedoutin compliance with(i) the laws and regulationsof Zambia which are, from time to time, of general application, (ii) any arrangements with the MUZ or any other trade unions from time to time recognised as representing some or all of NFCA’s employees and (iii)the terms of individual employment contracts from time to time. TheTraining and Human ResourcesManagement Programme identifies a minimum number of employees necessary to conduct Normal Operations from time to time. NFCA will ensure that the number of its employees will not be reduced below such levels without ninety (90) days prior notification to GRZ 6.6 NFCA will not discriminate in its remitment, selection, promotion and assignment of personnel. 6.7 NFCA acknowledges GRZ’s policy to attract qualified Zambian citizens working overseas back to employment within the Zambian mining industry. hordertofacilitatethe fulfilment of this policy, NFCA will take all reasonable efforts in its recruitment and employment of employces in professional, managerial, engineering and scientific grades (including, but not limited tothe advertisingof positions in international press and trade joumls likely to have - 14- ‘ i circulation amongst suitably qualified potddemplayce~)to bring to the attention of such qualifiedZambians, positions of emp~oymentmlablewithin NFCA. 6.8 NotwithsgndingzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAthe provisions of this Clause 6. NFCA (and its contractors or sub- contractors) may bring into Zambia such non-Zambian citizens as, in the reasonable judgment of NFCA's management, are required to carry out operations efficiently and successfully and,zyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAat NFWs request (which shall be accompanied by the requisite information concerning the education, experience and other qualifications of the personnel concerned) GRZ shall, if such non-Zambian citizens qualify for entry under immigration laws and regulations of general application (atherthan by reason of a prohibition inconsistent with the provisions of this Agreement) within Zambia as in force from time to time, cause all necessary permits (including entry and exit permits. work permits, visas and such other permits or permissions as mybe requested) to be issued to such persons and their entitled dependents without undue delay and without hampering the continuous and efficient ~~I%X-IWICCof NFCA's obligations under this Agreement. 7.zyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAInsUranCe 7.1 NFCA shall ensure those aspects of its operations that are normally and commercially insurable (and where such insurance is customarily obtained in the mining].industry in accordance withgoad international mining practice) are insured and GRZ shall be advised of the policy or policies in place and shall forward copies to GRZ. 7.2 GRZ agrees that the murances specified in Schedule 6 are those which, as at the date hereof, vmuld otherwise be required by: (a) statutory instrument refkrred to Section lOl(1) of tie Act; (b) the Director pursuant toSection lOl(3) of the Act. 7.3 From the commencement of construction of the Project, NFCA shall, unless the policies of the insurance or any of its loan agreements state otherwise or GRZ otherwise agrees, use any mount paid toit pursuant to any damage or destruction provisions in any contract of insurance to reinstate such elements of the Project (except for Mine Products) in respect of which such amount was paid, provided that NFCA shall not be required to repair or restore any part of the Project that, prior to the damage or destruction, had been obsolete or was of no material value to the actual or potential operations of NFCA or where NFCA, following a review of the facts with GRZ, has notified that in their judgement the cost of doing so is not justified by the mcremental economic benefit which NFCA will derive therdkom. h the event that GRZ notifies NFCA that itdisagrees with such judgement, the matter shall be rekrred for determination to a Sole Expert m accordance with Clause 19. 8. Suspensionof Production 8.1 The parties acknowledge that following the Commencement of Normal Operations, NFCA's right to suspend and curtail production is governed by Section 28 of the Act and that, in the event of any such suspension or cumilmemt, the Minister may exercise pouers under Section 28(3) of the Act and NFCA may exercise its rights under Section 28(1) and (2) of the Act. - 15 - 8.2 GRZherebyzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAagrees that blbwhg the CommencementzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAof Normal Operations:zyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA 4. (a) the Minister's approval shall be deemed given maccordance with Section 28(3)(a) of the Act upon compliance by NFCA with this Clause; and (b) msuch event, any dimtioncapable of bemg given pursuant toSection 28(3)@)of the Act will only be given either: (i) mcompliance with this Clause; or (ii) if NFCA has not complied with any provision of this Clause and has not remedied such noncompliance! within thirty dzys of being given notice of such non-cmpliance by GRZ. 8.3 Foknving the Commencement of Normal Operations, NFCA myelect to suspend production if, m its reasonable opinion the Company forecastsm the fbllowing six (6)month period, NFCA's revenues from Normal Operations will beless than the sum of royaltiesand Operating Costs. Assoon as possible after giving notice under this Clause, NFCA shall submit a report giving details of projected revenue, royalties and Operating Costs brthe period of six (6) months aforesaid giving the reasons why, m its opinion, it is necesary to cease production. 8.4 Where pursuant to Clause 8.3 or otherwise in accordance with Section 28of the Act, NFCA haselected to suspend production, it shall maintain, subject to fair wear and tear, the Project soas to prevent significant deterioration until Normal Operations are resumed. 8.5 No later than twelve (12) months from the date on which NFCA suspended production pursuant toClause 8.3or otherwise in accordance with Section 28 of the Act and thereafter at no longer than twelve (12) month intervals until Normal Operations are resumed, NFCA shall submit a further report showing its projection of the Costs to Resume Operations and of revenue from Normal Operations (if resumed) for tie same period. 8.6 If a report submitted pursuant to Clause 8.5 shows NFCA's projection of revenues fiom Normal Operations for the succeeding twelve (12) month period is greater than itsprojection of the Costs to FknmeOperations for the said twelw (12) month period then NFCA shall promptly takesuch measures necessary toensure that Normal Operations are resumed within a reasonable time period. 8.7 Where production has been suspended for a continuous period of not less than three (3) years, the Minister may direct NFCA to mume Normal Operations if he is of the reasonable opinion that the Costs to Resume Operations is less than revenue from Normal Operations for the same period. The Minister will provide NFCA with a copy of GRZ's projections of costs and revenues supporting such opinion. 8.8 If NFCA disagrees with the Minister's direction pursuant to Clause 8.7 it may elect to submit GRZ's and NFCA's respective projections of revenue from Normal Operations and the Costs to Resume Operations to aSole Expert for hisopinion m accordance with Clause 19. vf - 16- 8.9 Where projections made by GRZ and NFCA haw beennkrdto theSole Expert pursuant to Clause8.8, theSoleExpertshalldeterminewhatprojectionsumld be reasonable to make mrespectzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAofzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAtbezyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAtwelve (12) month period under review and the optionof the SoleExpert shall be binding on tie Parties so that m the went that the Sole Expert accepts the projectionsof NFCA or isotherwiseof the opinion that if Normal Operations were resumed NFCA's revenue from the Project wddbe less than the Costs to Resume Operations in respect of the twelve (12) month period, the direction given by the Minister pursuant to Clause 8.7 shall be deemed to have been withdrawn. 8.10 WhenpursuanttoClause8.7the Minister hasdirectedNFCA to resume Normal Operations and that dmionhas not been or is not deemed to have been withdrawn, NFU, if it does not promptly take such measures to ensure that Normal Operations are resumed within a reasonable time period, NFCA shall be deemed to have abandoned the Project for the purpose of Clause 18.2(b); provided however, that where projections of revenue fi-om Normal Operations and the Costs to Resume Operationshave, pursuant to Clause 8.8, been referred toa Sole Expert, the time period shall run from the date the Sole Expert gave his opinion on the projections. 8.11 Nothing herein contained shall prejudice NFCA's rights !blk~~ingthe Commencement of Normal Operations to suspend or curtail operations under Section 28 of the Act for any other reason and the exexcise by the Minister of his powers under said section save as specifically described herein. 9. Social Assets 9.1 Subject to Clause 9.2,NFCA shall: (a) provide the Social Services to all employees of NFCA and the Registered Dependants of such employees entitled to benefit therefrom (including for the avoidance of doubt, all persons to whom access to the Social Services is granted by virtue of relevant redundancy or retirement provisions). NFCA agrees to continue to employ the same registration practice for detemning the eligibility of dependants to qualify as Registered Dependants as the practice for detemningthe same which was in place at the date of this Agreement. For the avoidance of doubt, the provision of the Social Services by NFCA to its employees and Registered Dependants shall be under the terms of the Social Services Access Agreement until the expiry of the terms of this Agreement and then by NFCA making such arrangements as NFCA thinks fit (provided always that the level and standardof the Social Services provided remains atthe levels specified in Schedule 7); (b) ensure that the Social Services made available to those persons described in Clause 9.l(a), at the time of this Agreement coming into effect, at the level and standard then applying and thereafter, at a level appropriate to the number of persons entitled thereto, namely the number of NFCA employees and their Pgistered Dependants from time to time. 3y - 17- (c) ensure that the Social Servicesare provided to such ~C~SOIIS described in Clause 9.l(a) at least to the same standard (as to range and quality of service) as that currentlyamilable at tiedate of this Agreement (and as is specified in Schedule7); andzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA (d) ensure that the charges for the pmision of the Social Services to such persons describedin Clause 9.l(a) above are no greater in red terms than those currently levied as at the date of this Agreement. 9.2 . htheevent that NFCA determines that it will become unable to comply with the provisions of Clause 9.1 for any reason whatsoever, it shall fixthwiti give notice to GRZ of this bct. GRZagrees that it will accept such nonumpliancewith Clause 9.1 and that no action will be taken under this Agreement if, simultaneously with the giving of such notice, (i) NFCA submits proposals to GRZ for an increase in general levels of remuneration or other employment benefits toemployees of NFCA m order tocompensate such persons for the withdmval of rights tozyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAoccupy, receive or use or fix NFCA's employees or civilians to occupy or use the Third hrty Social Assets and (ii) if NFCA also provides GRZ with reasonable evidence that such proposalsare (in the case of (i) above) agreed with any trades tion(s)then representing emplcyees of NFCA. 9.3 Pending confirmation from GRZ that such proposals for increases in general levels of remunerationsor other benefits are acceptable to it, NFCA will comply in all respects with Clause 9.l. GRZ agrees that it will respond to NFCA's proposal within sixty (60)days of receipt of the same hmNFCA. 9.4 If the Ftuties disagree about: (a) the availability of the Third Party Social Assets pursuant to Clauses 9.l(a) and 9.W; (b) the standard of, or charges made for, the provision of the Third Party Social Assets pursuant to Clauses 9.l(c) and 9.l(d); and (c) the acceptability of proposals made by NFCA pursuant to Clause 9.2, either party may elect to submit the matters in issue to a Sole Expert for determination m accordance with the provisions of Clause 19. 9.5 NFCA will perlimn its obligations under the Social Services Access Agreement(s). 9.6 NFCA shall: (a) allw tie public and GRZ to use free of chargezyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAany roads constructed antior maintained by NFCA which by custom and practise have been freely available for public use. prwided, hmever, that such use shall not unduly prejudig or interfere with NFCXs operations hereunder; - 18- (b) alhvGRZandzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAthird parties tohave access over the Contract Area, provided that access does not unduly prejudice or interfere with NFCA's operations suchzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA ka hereunder; (c) dlcw GRZ m place, ftee of charge at its mmexpense, telegraph and telephone wires cmthe poles of the lines of NFCA, provided that such installation does not unduly interfere withNFCA's efficient use of such poles and lines. 10. Recordsand OperatingReports 10.1 NFCA shall. pursuant toSection 104 of the Act, keep GRZ, through tie Ministry, advised concerning NFCA's operations through submission of progress reports, beginning with the first quarter follwing tiedate of this Agreement, as to the progress and results of NFWs miningoperations and any prospecting and appraisal activities under this Agreement. 10.2 hmmttoSections 2(d) and (e) of the Fourth Schedule to tie Act, NFCA shall provide quarterly reports to the Ministry, broken out on a mine by mine basis in the case of (a) to (c) below on: (a) quantitiesof ore mined and average head grades; (b) quantitiesof waste mined; (c) quantities of copper and cobalt concentrates produced and quantitiesof contained copper and cobalt; (d) Operating Costs; and (e) progress m implementing the Scheduled Programmes, the extent of any continuing non-uxnpliance by NFCA with Environmental laws and progress made in remedying this in accordance with the Environmental Plan. 10.3 NFCA shall file with the Ministry a summary of any geological and metallurgical investigations and such other material data as may be obtained from any prospecting activitiesand a sample representative of each principal type of mineralisation encountered in such investigations. 10.4 NFCA shall provide quarterly reportsrelating to any prospecting, appraisal and development activities to the Ministry which shall include such information as to the progress of operations m the Mining Area as the Ministry may from time to time reasonably require. 10.5 All information furnished to GRZ shall be in English and, in the event that such inbrmation is a translationfrom tieoriginal, shall be a certified true translation. All financial data shall be recorded m US dollars. 10.6 NFCA shall maintam all original records and reports relating to its activities and operations under this Agreement including all documents relating to financial and commercial transactions with independent parties and Affiliates in its principal office mZambia. These - 19- mumh and reports shall bezyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAopened to inspeaion by GRZ through an authorised representatheduring normalzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAworking hours. Such reports and records shall be maintained mthe Englishlaqpage and all financial data shall be recorded m US dollars. 10.7 All records,zyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAreports, plans, maps, charts, accounts, and information which NFCA is ormay be from time totime required to supply under the provisions of this Agnxment shall be suppliedat the expenseof NFCA. '20' PAWTC UNDERTAKINGSNECESSARYFUR OPERATIONS 11. ForeignExchange 11.1 The hrties adawwledge that under legislation and practice currently in force in Zambia, NFCA is free to: (a) remtforeign currency out of Zambia; (b) maintainhreigncurrency accounts outside of and within Zambia; and (c) remtforeign currency accruing to or earned by it outside Zambia into Zambia. 11.2 htheevent foreign exchange controls were to be re-introduced in Zambia within fifteen (15) years from the Effective Date, NFCA shall have the right to: (a) retain both outside Zambia and within Zambia, maccounts established fix that purpose, foreign currency, and to have paid to it and maintain in such accounts the fo~lcJwing: (i) proceeds of the sale of Mine Products; (ii) payments made by insurers not resident in Zambia under contracts of insurance in NFCA's favour. (iii) proceeds of any disposal of capital assets received from persons not resident in Zambia for foreign exchange purposes; (iv) the amount of any funds received pursuant to any loan finance provided by persons not resident in Zambia for foreign exchange purposes; (v)zyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA any share capital received in foreign currency from persons not resident in Zambia for foreign exchange purposes; and (vi) any other foreign currency earned or accrued in the ordinary course of business from persons not resident in Zambia for foreign exchauge PUrpo=- (b) use fieely tie foreign currency accounts maintained by NFCA to: (i) service payments of principal and interest, service charges and other fees and expenses in respect of any loans arranged with nonZambian institutionsto implement the Approved Programme of Mining Operations or otherwise linance or refinance the Project;zyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA 4tf - 21 - (ii) make payments due to (a)suppliers outside Zambia fix he supply of goods and services to NFCA (including capital goods and services of foreign employees and consultants) where goodsand services are required to implement tiezyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAApprmd Programme of Mining Operations and (bb) suppliers inside Zambia with respect to the treatmentirdinmg of ores and concentratesand to the supply of elecmcity to the Project facilities; (iii) finance the payment of dividends to shareholders who are not resident in Zambia for foreign exchange purposes. Provided that such payments are made out of DistributableProfits (as deiined m the Companies Act); (iv) pay expatriate employees whose contracts of emplqmentspecify that they be paid (mwhole or m part) ma currency other than Kwacha; and (v) effect such other payments m foreigncumcyto persons not resident in Zambia for foreign exchange purposes as may be necessary or desirablem tieordinary course of NFCA's business. 11.3 NFCAshallsubmitto the CentralBank: (a) within fifteen (15) days of the end ofzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAeach Quarter - (i) a statement of the foreign currency accounts maintained overseas by NFCA showing movements on the accounts during the Quarter with Quartercnd balances; (ii) a statement of the foreign currency accounts maintained at banks within Zambia by NFCA showing movements on the accounts during the Quarter with Quarterend balances; (iii) a statement of the foreign exchange converted into Kwacha and the total amount of Kwacha converted into foreign exchange during the Quarter;and (iv) a forecast of the foreign currency which it expects to receive and retain in a foreign currency account overseas or within Zambia and that which it expectsto convert into Kwacha during tie ensuing Quarter; and (b) within five (5)monthsof the end of each financial year, audited financial statements showing the amount of Distributable Profits (if any). 11.4 hthe absence of exchange controlsm Zambia, NFCA shall have the samerightsto buy and sell currencies from authorised dealers as other commercial concerns in Zambia. h the event exchange controls were to be reimposed (and without prejudice to NFCA's rights under Clause 11.2) such controls shall not beapplied toNFCA in a manner less favourable to it than the manner m which they are generally applied. NFCA shall be entitled to buy and sell foreign exchange in accordance with such controls at rates of exchange no less fhvourable than those available to other commercial buyers and sellers concerned. \ - 22 - 11.5 NFCA shallremit mZambiaand com~them mm Kwcha fbr credit to a bank account in the name of NFCA m an orderly fashion sufficient fixeign currency earnings arising from the sale of Mine Products to pay all such comanents as NFCA may have incumd in Kwacha (including, without lmtation. obligations to pay dividends to local shareholders payable in local currency,zyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAtaxes, royalties and custom duties).zyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA 11.6 NFCA shall not engage m or use any provisions of this Clause 11 or any authority or approval givtn by the Central Bank to engage in Speculative Currency Transactions. If NFCA isin breach of this Clause it shallpay to GRZ as liquidaml damages an amount equal to the amount ofzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAany net after tax profit or gain which NFCA makes on the Speculative Currency Transaction and any cost incurred by GRZ in establishing that the transaction was a Speculative Currency Transaction. 11.7 Where any right or assurance given to NFCA under this Clause 11 requires tie Central BiUlk: (a) to approve any act, matter or thing; or (b) to grant authority under applicable law and nzgulations for its exercise orzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA performance, and NFCA has supplied any necessary infixmation to the Central Bank and otherwise met tie conditions of this Clause 11, GRZ shall, upon quest from NFCA ensure by policy directions to the Central Bank or otherwise that such approval is given or such authority is granted. 11.8 NFCA will ensure that any borrowings it may incur denominated in Kwacha will not exceed tieKwacha equivalentof five million United States dollars (U.S.$5.000,000). 11.9 NFCA will ensure that the Central Bank will not suffer discrimination by NFCA in access to foreign exchange sold by NFCA for Kwacha save that NFCA shall only be obliged to sell its foreign currency at the prevailing foreign exchange buying rate applicable at tie time of sale. 12. EnvironmentalIssues 12.1 NFCA will (subject to the provisions of Schedule 16 of the Sale and Purchase Agreement and the provisions of and save to the extent pmided otherwise in this Clause 12) comply with: (0 envimmmtal and sakty laws and regulations enacted or promulgated within Zambia from time to time which are of general application (including, fix the avoidance of doubt, make such contributionas is required under Section 82 of the Act for the Environmental Protection Fund); and (ii) the Environmental Plan applicable from time to time. qYq' - 23 - 12.2zyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAWithout prejudice to tie foregoing, NFCA shall perfimn the Environmental Clean Up Obligations applicable hmtime to time m accordance with the pmrisions of the Emmm~~ntal Planapplicablehmtimetotimeand within thetimescale and subjectto the conditionstherein set out. 12.3 Subjecttocomplianceby NFUwith tieEnvironmental Plan and tie ~nvironmmalClean Up Obligations applicable from time to time and save as provided in Clause 12.6 below, GRZ hereby confirms titit will not fix a period of fifteen (15) years from the Effective Date take any action (and will procure no action is taken by any of its Ministries, departments, agenciesor instrumentiitiesover which it has operational control acting on its behalf) under, or m enforcing,arty applicable Environmental Laws with the intent of (a) securing NFCA's earlier compliance with Environmental Laws or earlier implementationof the Environmental Clean Up Obligations than that envisaged by the timetable and conditions set out in the Environmental Plan as applicable from timetotime; (b) requiring NFCAtoclean up andlor remove any stock of pollutants which was pre- existing as at the Effective Date and which is not included as an Environmental Clean Up Obligation applicable from time to time; (c) imposing lines or penalties upon NFUpayable under Environmental Laws (or enacting new fines and penalties thereunder which are payable in respect of NFCA's non-compliance with such Environmental Laws and where the Envimnrnental Plan applicable from time to time provides for the remedy of tie sameinaccordance with a specified timetable and NFCA is in compliance with that timetable; (d) imposing fines or penalties in respect of NFCA's breach of Environmental h in excess of those applying on the Effective Date, adjusted (where denominated in Kvncha) to take account of Zambian inflation since that date, having, in the case of (a) and (b) above, a material adverse economic effect on the implementation of the Approved Program of Mining Operations and/or Normal Operations. 12.4 Intheevent of a material non-compliance with the Environmental Plan or the Environtnental Clean Up Obligations applicable from time to time, GRZ will (in the event that such material non-compliance is not remedied within three (3) months notice thereof being provided by GRZ to NFCA or, in the went of a dispute regarding non-compliance being referredto the SoleExpertpursuantto thisClause 12.4. suchperiod as tieSoleExpertmy decide inzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAany determination that he gives) cease to be bound by the provisions of Clause 12.3and the Parties acknowledge that GRZ (or its Ministries, departments or such agencies acting on its behalf) shall be fiee to take such action under, or m enforcing, applicable Environmental Laws as it or they shall consider appropriate or necessary. 12.5 Any dispute regarding a material non-compliance with an Environmental Plan or the Environmental Clean Up Obligations may be refkrred by either Party to a Sole Expert in - 24 - accordance with Clause 19, for detamimtionwithii thirty (30) days of notice giwn by a Partyto the other of its intention to rekto the matter to the Sole Expert.zyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA 12.6 The Ministcr on behalf of GRZ may propose an amendment to the Environmemal Plan applicable from time to time if: (a) at any time the conduct of Normal Operations in accordance with such Environnmml Plan for whatever reason poses a material danger to public health and sakty ormay result in significant damage to the ecology of the area which was not contemplated in such Environmental Plan and is or may become irreversible or only become reversible or only be reversed after the lapse of fi!ken (15) years; or (b) the environmental impact of Normal Operations shall pmesubstantially more adverse than anticipated in such Environmental Plan; or (c) tedmology or procedum, or improvements thereof shall have been available and economic subsequent to the adoption by NFCA of such Environmental Plan and, if applied to the operation of the Facilities, could materially mitigate the environment impact of Normal Operations. 12.7 htheevent of a variation of an Environmental Plan proposed by the Minister on behalfof GRZ under the circumstances set forth m Clause 12.6. NFCA undertakes to consider the proposed variation in good hith and, unless by notice of objection served on the Minister within twenty (20) days of receipt of the proposal made pursuant to Clause 12.7 it infbrms the Minister that it considers the proposed variation to be unreasonable it shall be deemed to have agreed the same. A notice of objection shall include a written statement of the reasons why NFCA considers the proposed variation to be unreasonable setting out: (a) its estimate of the direct costs to implement such change; (b) its analysisof the variation in the environmental impact that would be effected by such change; and (c) its appraisal of the economic and other effects of the change proposed by GRZ. 12.8 Following receipt of a notice of objection under Clause 12.7, the Minister shall, as soon as possible, inform NFCA by notice in writing whether or not the Minister’s proposal for variationof the then applicable Environmental Plan isor isnot withdrawn. In the wentthat the Minister’s proposal for variation is not withdrawn it will bedeemed to have been agreed unless NFCA elects to submit fix the opinion of a Sole Expert in accordance with Clause 19, the question of whether GRZ’s proposal for variation is unreasonable. Should NFCA make that election, the opinion of the Sole Expert will be binding on the parties with effect that: (i) if the Sole Expert detemnes that GRZs proposal fbr variation is not unreasonable the proposal fbr variation will be deemed to agreed;or -25- (ii) if the Sole Expert detemks that GRZ3 proposal for variation is unreasonablethe proposal will be dcmcd to haw been withdrawn. Pmvidedthatthe SoleExpertmaymhissolediscretion suggestaltedveproposalsortime sckxMcsormitigation of cost proposals to the htieswho will consider the same m good faith prior to the determinationkingrendered by tieSoleExpert. The period during which such proposals shall be considered by the htiesshall notzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAexceed thxee (3) months. 12.9 Where a variation to as Environmental Plan proposed by the Minister has been agreed by NFCA or is deemed to have beenzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAagreed by them pursuant to this Clause 12, the then applicable Environmental Plan shall be amended accordingly. 12.10 Notbgm this Clause 12 shall be deemed to limit the right of GRZ to take such other actions within its power9 such as those rights given to the Director of Mine Safety under Section 81 of the Act, to protect the public health and safety. 12.11 NFCA shall be entitled to amend the Environmental Plan or the Environmental Clean Up Obligations applicable from time to time, provided that following such amendmemt the Environmental Plan or the Environmental Clean Up Obligations (as the case may be) conforms to specifications and practices established by Zambian standards for the management of the environment as it is tiected by mining operations, so as to reflect changes m operations and other circumstances considered to be appropriate by NFCA and shall deliver a copy of such amended plan or obligations to the Minister whereupon it shall become part of the Scheduled Programmes If however, GRZ considers that any such amendment would constitute a Major Change (as defined in Clause 22.3 herein) the provisionsof Clause 22 shall apply. 12.12 Notwithstanding the provisions of this Clause 12, NFCA shall, at the invitation of the Minister responsible for the cnvimunent, participate either individually or on an industry-wide basis, in discussions relating to the impact and effectiveness of the Environmental h or on any prospective changes thereto. 12.13 For the avoidance of doubt, nothing in this Clause 12 shall be construed to render NFCA liable for penalties or fines imposed, or third party claims made, in respect of activities undertaken prior to the Effective Date by ZCCM. 12.14 GRZ hereby confirmsthatenvironmental liabilities of ZCCM to third parties not specifically assumed by NFCA m the Environmental Plan and Environmental Clean-up Obligations (whether disclosed or undisclosed and including those arising out of stocks of pollutants created mthe conduct of ZCCM’s operationsprior to the Effective Date), tothe extent that they arose prior to or relate to activities carried on prior to the transfix of assets to NFCA pursuant to the Sale and Purchase Agreement, and which have not been specifically transferred to or assurned by NFCA, will remn tieresponsibilityof ZCCM as a matter of current Zambian law. 12.15 Subjecttocompliance by NFCA with the Environmental Plan applicable from time to time in all material respects and save as provided in Clause 12.6,GRZconfirms that it will not for fifteen (15) years from the date hereof take any action (which will include a p~oposalto - 26 - amend the Envimmncntal Plan other thanas permittedpursuant toClause 12.6 and which proposed amendment willzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAbe further subject, for the avoidance of doubt to the provision in Clauses 12.7 to 12.10) and will procure that no action is taken by any of its Ministries, deparmmts, agencies or instnmentalities acting on its behalf, to make or render NFCA liable for anyzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAsuch environmental liabilities as are refixred m in Clause 12.14 in order to prwide certaintyof applicationof legislationto NFCA. GRZ hereby confirms that should commonlaw applicablem Zambia be interpreted differentlyin suchperiod, it will tiesuch action openm it (including the passing of appropriate legislationor regulation) to ensure the legal position set out mClause 12.14 is maintained. l’ - 27 - PMD 8- TAXATIONzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA 13. General Obligationto Pay 'hx 13.1 SubjectzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAto Claw 15, NFCA shallzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBApay tax, royalties and duties from time to tim in amrdancewith applicable legislation. 14. Clarificationof TaxationLegislation 14.1 GRZshallensure that VAT cdlectedon goods and servicespracured by NFCA is refunded to NFCA as soon as practicable from the date of submission of NFCA's monthly VAT return. 15. TaxationStability 15.1 GRZundertakes that it will not for a period of fifteen (15) years from the Effective Date: tax or withholding tax rates applicable ti NFCA (or (a) increase corporate incomezyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA decrease allowances available to NFCA m computing its liability to such taxes) from those prevailing at the date hereof; or (b) otherwise mend the VAT and corporate tax regimes applicable to NFCA from those prevailing as at the date hereof;or W impose new taxes or fiscal imposts on the conduct of Normal Operations, (d) alter the right of any nonZambiancitizens (and entitled dependants) (on his or their arrival or permanent departure from Zambia) to; (i) import free of duty and tax, for personal use, household and pers0~1 effects; (ii) export,without let or hindrance orthe imposition of duty or tax on export, all personal effects originally imported or acquired during residency in Zambia; and (iii) freely remit all income earned in Zambia during such residency, soas to have, in each case, a material adverse effect (the issue of whether or not such effect ismaterially adverse to be detemned by a Sole Expert in accordance with Clause 19in the event of disagreement between the Parties) on NFWsDistributableProfitsor the dividends received by its shareholders. GRZ furtherundertakes that for the sameperiod of fifteen(15) years, it will not: 8f '28' \ (e)zyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAincrease: (i) the rate of royalty from the level prevailing at the date hereof; or (ii) import duty rates applicable to NFCA (including the IDF) so as to result mthe weighted average import duty rate (inclusiveof the IDF) to which NFCA is subject on the import of goods and materials required for the Approved Programme of Mining Operations or Normal Operations and which would, at the date hereof, be exempt from customs and excise dutieszyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA under Section 97(1) of the Act, above a level of five per cent. (5%);or (iii) import duty rates (including the IDF) applicable to NFCAzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAso as to result in the weighted average import duty rate (inclusive of the IDF) to which NFCA is subject on the import of other goods and materials required for the Appnmd Programmeof Mining Operationsor Normal Operations and which do not fall under Clause 15.l(d)(ii), above a level of twenty per cent. (20%);or (iv) the Rural Electrification Levy applicable to NFCA's purchases of power hmthe level applicable on the date hereof;or (0 impose other royalties or duties on Normal Operations, so as to have a material adverse effect on NFCA's Distributable Profits or the dividends received by its shanzholders. 15.2 GRZ shall ensure that no law, statute, regulation or enactment shall be passed or made which would discriminate against NFCA in respect of any such matters as are referred to in Clause 15.1 or otherwisein its conduct of Normal Operationsor myother circumstances under this Agreement when compared to other mining companies or joint ventum conducting similar operations on a scale equivalent to those conducted by NFCA in Zambia provided that GRZ will be at liberty to pass or make any such law, statute, regulation or enactment toenable the performance or amendment of a development agreement entered into by it and another mining company orjoint venture and, for the avoidance of doubt any such law, statute, regulation or enactment shall not constitute "discrimination" for the purposes of this Clause. 15.3 GRZcovenants to reimburse NFCA (or, at its option, make offsetting changes in any law, statute, regulation or enactment applicable to NFCA within a reasonable time provided that GRZshall reimburse NFCA for any loss suffered during the period of time taken to make such offsetting change withina reasonable periodof time) to ensure NFCA isfully and fairly compensatedfixany costs incumd by it by reason of a failure by GRZ to comply with the provisionsof Clauses 15.1and Clause 15.2. 15.4 Notwithstanding the provisions of this Clause 15, NFCA shall be automatically entitled to any favourable changes to the Laws of Zambia of general application within th sector. - 29 - PARTE FORMALzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBACLAUSES 16. A&gme!nt 16.1 NFCA may, with the consent of the Minister. assign its interest in the Large Scale Mining Licences and GRZ covenants that the consent of the Minister to an assignment will not be withheld m the circumstances set out m Clauses 16.4and 16.6. 16.2 If NFCA assigns its entire interest in the Large Scale Mining Licences and its rights and obligations under this Agreement, then upon the assignee giving GRZ the undertaking referred toin Clause 16.3, NFCA shall be discharged from any further liability in respect of any obligation which accrues after the date of that assignment without prejudice to pre- existing rights accrued to GRZ against NFCA. 16.3 Where an assignment ties effect pursuant to Clause 16.1. NFCA shall enter into an agreement with the assignee wherein the assignee agrees with NFCA and undertakes toGRZ that it will: (i) become a party to this Agreement; and (ii) assume, observe and comply with all obligations of NFCA under the Act, regulations made thereunder and this Agreement. 16.4 Notwithstanding the hregoing provisions of this Clause 16, NFCA may - (a) charge by way of fixed or floating charge the whole or any part of its undertaking and assets including the Large Scale Mining Licences, the Leases, my Mine Products and uncalled capital (and premiums) to secure the repayment of principal, and payment of interest and other fees, costs and expenses relating to all loans made to NFCA tofinance or refinance the Scheduled Programmes; and (b) mortgage and charge any specified asset (whether real or personal property) to securethepurchase price thereof where such amount has been borrowed to finance . the purchase of that asset and this asset is to be used as part of Normal Operations; and GRZ covenants that the consent of the Minister to such mortgages and charges shall be given provided that such mortgages and charges are notified to the Minister upon their grant (and, in any event, within sixty (60) days thereof). Subject toClause 16.5,any mortgagee or chargee under a mortgage orcharge given by NFCA pursuant tothis Clause may exercise all rights of sale and other rights included m such instrument of mortgage or charge provided it shall first give to GRZat thirty (30)days notice of its intention to exercise any rights of sale and five (5)days' notice in all other cases. 16.5 The rights of any mortgagee or chargee under a mortgage or charge given by NFCAzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA pursuant to Clause 16.4 shall be subject to and lmtiby the rights of NFCA under this Agreement and toGRZ's right toted~tethose rights under Clause 18.2. The rights of - 30 - q!kf \ such mongagee, chargee or lender to sell thezyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAassets of NFCA so charged shall not be artrcisable: (a) unless all those assets and undertakings of NFCA which axe charged by the mortgage or charge are sold as a going concern (or with such exceptions as GRZ may agree) to a purchaser appmcd by GRZ (which appdGRZ covenantsnot tounreasonably withhold); or (b) if GRZ has withii tie thirty (30) day period of notice under Clause 16.4 given notice tothe mortgagee, chargee, or lender that it will purchase some or all the assets which the mortgagee, chargee or lender wishes to sell at a price which is equivalent to: (i) the highest price which a bonujde purchaser who is at arms' length from NFCA, its shareholders and the mortgagee, chargee or lender has offered to pay for the assets and undertakings; or (ii) if there is no such offer, at a total price qual to the fair market value of the same as an ongoing concern to be dctcmncd by agrement between the parties but hiling such agreement to be determined by aiSole Expert in accordance with Clause 19, andsettlesthe purchase by making full payment of the price at the principal address .. . of *the mortgagee, chargee, or lender and m the currency denominated in the loan , . i. .. "betweenthe mortgagee, chargee or lender and NFCA within ninety (W)days after - -, c .'notificationto GRZof such place for payment and designated currencyor otherwise . A on terms agreed with the mortgagee, charge or lender. 16.6 Where the Minister's consent isnecessary to effect: (a) anassignment under Section 54(1)of the Act or a change of control under Section S(1)of the Act; or (b) an assignment pursuant to Clause 16.1, GRZwill procure that the Minister will not withhold his consent where, in tie case of an assignment, the proposed assignee has demonstrated its financial capacity and technical ability to metits obligations hereunder or, inthe case of a change of control of NFCA, the acquiring party has demonstrated that it is of appropriate financial standing having regard, inter alia, to the obligations it will assume under the Sale and Purchase Agrement and the Shareholders' Agreement. 16.7 In the event that NFCA considers that the Minister has acted unreasonably in considering that a proposed assignee or acquiring party has not demmtrated such fmancial capacity or technical ability as is rekrred to in Clause 16.6, it may r&r the issue to a Sole Expert for its opinion in accordance with Clause 19. If the Sole Expert determines that the M' 'sterzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA 4y - 31- has bebedreasonablymzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAdctemlining that the proposed assgnee or acquiring (a) party h not demonstrated the requisite levels of fmancial or technical ability, the Minister’s determination shall stand; or (b) has behavedunreasonably m so determinii, the Minister’s detemnation shall be set aside and the consents rekrredzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAto mClause 16.6(a)or Clause 16.6@)(as the case may be) shall be deemed given. 17. Extensionsto Time 17.1 Notwithstanding any pmision of this Agreement, the hrties by agreement between the persons responsible fixgiving Notices under Clause 24, may from time to time extend any period rekrred to mthisAgreement, or substitute for any date rekrred to in this Agreement such later date, as they think fit. 17.2 If NFCA is prevented or hindered by any circumstances or event of a kind set out in Clause 21 or by a rekrence to a Sole Expert or by m arbitration under Clause 19 from undertaking all or any of its obligations hereunder or exercising any right granted, the period of time allmved for thezyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAperfhnance of that obligation or exercise of that right and all periods of time thereafter allowed fix the performance of obligations or exemise of rights which are dependent upon the first mentioned obligation or right, shall be extended by a period equal to the period during which such prevention or hindrance continues or during the period from the time when the question, dispute or difference arose until the time of its determination by the Sole Expert or settlement by agreement or arbitration, as the case may be. 17.3 Whereanyperiod is, or is deemed tobe, extended or any later date substituted for an earlier date under this Clause, that extended or substituted period or date shall be deemed to constitute the period or date rehred to in this Agreement (notwithsmdingthat at the time of such extension or substitution such period may have expired or such date myhave passed). 18. Termination 18.1 NFCA may teti~tethis Agreement at any time after the fifteenth anniversary of the Commencement of Normal Operations by giving twelve (12) months notice toGRZ. 18.2 GRZmay terminatethisAgreement by notice to NFCA if (a) all of the Large Scale Mining Licences have expired by aflluxion of time and have not been renewed; or (b) the land the subject of the Large Scale Mining Licences is under Section 49of the Act. - 32 - 18.3 htheeventtit: (a) NFCA is m material default m the pcr5xmance of the obligations of NFCA set forth in this Agreement. For the purposes of this Clause 18.3(a), "material default" shall mean tie default by NFCA of an obligation which significantly effects thezyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA performance of NFCA's obligations mrespect of the Scheduled Programmes and/or the investment Commitment and which is not remedied by NFCA within thirty (30) days of a notice by GRZ requiring NFCA to do so; or (b) NFCA fails m treat as binding and comply with any awadmade by a Sole Expert or m an arbitration pursuant to Clause 19, GRZmaygive notice of such default or failure (hereinafter in this Clause called a "Default Notice")toNFCA which shall specify the default or WUR alleged. NFCA shall at the same time give a copy of the Default Notice to each lender to NFCA, where the nameand address of that lender has previously been notifiedzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAto GRZ, and to each mortgagee or chargee of any of NFCA's assets under any mortgage or charge notified to the Minister in accordance with Clause 18.4. If NFCA disputes the subject matter of the Default Notice it may rekr the issue to arbitration pursuant to Clause 19. 18.4 If within a period ofzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAthree hundred and sixty (360) days fbllowing a Default Notice (or such longer period as may be fixed by an arbitration awud where the subject matter of the Default Notice is submitted to arbitration under Clause 19) either: (a) the default or failure specified in the Default Notice has not been remedied (or active steps have not been commenced and continued to remedy the default or failure if it is not capable of speedy remedy); or (b) compensation is not paid in respect thereof (in the case of a default or failure not capable of remedy but where payment of compensation would be adequate recompenseto GRZ), then, subject to Clauses 18.5, GRZ may by notice (hereinafter m this Clause called a "Termination Notice") to NFCA (which shall be copied to each lender, mortgagee or chargee who was given a copy of the Default Notice) bring abutthe temnation of this Agreexnent on a date which is not less than one (1) month thereafter (hereinafter mthis Clause called the "TerminationDate"). GRZ shall ensure that the Minister does not make a decision to suspend or cancel NFCA's Large Scale Mining Licences, and that no other action is taken by or on behalf of GRZ without the approval of NFCA to terminate the Large Scale Mining Licences or any of the Leases prior to the TemnationDate. 18.5 If NFCA or GRZ contest: (a) the grounds for the issue of the Dcfbult Notice; or (b) whether the default or failure has been remedied; or (c) the adquacy of any compensation paid pursuant to Clause 18.4@) - 33 - +rf ' \ the matter shall be submiucd fbr arbitration pursuant to Clause 19. If the arbitxator finds (mthecase of pamgraph (a)) that adequategrounds exist ibr issueof the Default Notice, he shallzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAfix a period during which NFCA mustcomply with Clause 1Wa)or 1&4(b) and the amount of compensation payable (if applicable). If the arbitrator finds (in the case of paragraph (b)) m €wow of GFU, he shall fix a period during which NFCA must remedy the default or failwe. If the arbitrator finds (m the case of (c)) m hour of GRZ, he shall fix the mount of coqemationpayable and the period for its payment. GlZZ shall not serve a Termination Notice while arbitration between GFU and NFCA under this subclause is in progress and any Termination Notice almdy served will be suspended immediately upon the commencement of such arbitration for the duration of any such arbitration. If the arbitrator finds in howof NFCA, or within the period fixed by the arbitrator the default or failure is substantially remedied or the compensation is paid, GRZ shall not serve a Termination Notice and any Termination Notice already served shall be deemed withdrawn. 18.6 If this Agreement is temxuted: (a) NFCAwill surrender to GRZ the Large Scale Mining Licences and the Leases but without prejudice to the liability of any of thezyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBARmks m respect of any antecedent breach or defimlt under this Agreement or in respect ofzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAany indemnity given; (b) each Party shall forthwith pay to tie other Party all monies that mybe owing to the other hrty hereunder; (c) GRZ shall have the option to request that NFCA abandon the Facilities within the reasonable timetable specified by GRZ and the option to purchase (subject to any encumbrances thereon), all or any portion of the Facilities at a price equivalent to the lesser of the then residual value of such assets after tax depreciationor the fair market value of such assets, which fair market value is to be detemned by agreement between GRZ and NFCA but failing such agreement by a Sole Expert in accordance with Clause 19. Such option to be exercisable by notice to NFCA within thirty (30)days following temnation of this Agreement. If requested to do so by GRZ. NFCA shall also assign to GRZ such contracts to which it is a party as GlZZ detemnesand deliver all records of the Facilities held by NFCA to GRZ; (d) NFCA shallhave the right, within the one (1) year period following the thirty (30) day notice period &rred to in Clause 1&6(c): (i) to assign or otherwise dispose of all or any portion of the remaining Facilities to any person; or (ii) to remove and recover from the Mining Area and export from Zambia any of the remaining Facilities on the condition that such removal does not cause irreparable damage to major assets which are not removed Mining Area; and -34- (e) NFCA shall leave tie h4iningArea ma sak and stable condition to the reasonablezyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA wishction of tie Dimmr of Mine Safkty having regard to ~t~dconditions in the area and applying generally accepted standards of good mining practice, pmided that NFCA shaIl not be required to alter the physical condition of the mine, any tailings disposal site, or other Project facilities beyond the requirements of the EnvimnmentiPlan applicable from time to time.zyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA Upon the expiry of theone (1)yearperiod refkmdto in Clause 18.6(d),all Facilities which 18.7 remain on the Mining Area shall become tieproperty of GRZ without any cost to GRZ or any liability for GRZ topay compensationtherehr. 18.8 Chwes 18.6, 18.7, 19, 20 and 21 shall continue in hrce notwithstanding the termination of the rest of this Contract. 19. Arbitration and Sole Expert 19.1 For the purposes of this Clause, Wispute" means any dispute, disagreement, controversy or claim arising out of or relating to this Agreement, or the interpretation or perkmnance of provisions of this Agreement or tie breach, termination or validity thereof, which the Rmies are unable to resoh by mutual agreement within a reasonable time: It does not include any difference of view or disagreement which, pursuant to provisions of this Agreement, mybe submitted for determination of a Sole Expert. 19.2 GRZ and NFCA hereby consent to submit to the International Centre for Settlement of Investment Disputes (tie "Centre")any Dispute for settlement by arbitration pursuant to the Convention on the Settlement of Investment Disputes between States and Nationals of Other States (the "Convention").Arbitration shall be held in London, or such other place'as the Parties may agree in writing. 19.3 It is hereby agreed that, although NFCA isa national of Zambia, it is controlledby nationals of China and shall be treated as a national of China for the purposes of the Convention. 19.4 Any arbitral tribunal (the "'Mbunal") constituted pursuant to this agreement shall consist of a sole arbitrator appointed by agreement and an arbitrator, who shall be President of the . Tribunal, appointed by agreement of tie parties or, failing such agreement by neutral official. 19.5 Anyarbitration proceeding pursuanttothis Agreement shallbe conducted in accordance with the arbitmtionrules of tieCentrein effect on the date on which theproceeding is instituted. 19.6 Anawardin arbitration proceedingsheld pursuant to the Convention shall be binding on the parties and judgement thereon may be entered in any court having jurisdiction for the purpose. 19.7 GRZhereby inevocably waives any claim to immunity - (a) mrespect of proceedings to enfime any such award including, without limitation, immunity fromserviceof process and from tiejurisdictionof the Court - 35 - 3fi v \ (b) in respect of execution ofzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAany suchzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAaward against the property of GRZ outside Zambia. 19.8 The waiver of immunities rcfkrred to herein constitutes only a limited and specific waiver for tie purposes of this Agrement and under no circumstances shall it be intcqmted as a generalwaiver by GRZ ora waiver with reqxct to proceedings unrelated to this Agreement. GRZhas not waivedsuch immunity in respect of property which is (i) located in Zambia; (ii) used by a diplomaticor consularmission of GRZ(except as mybe necessary to effect serviceof process), (ui) property of a military character and under the control of a military authorityor deknce agency, or (iv) located in Zambia. 19.9 Unless otherwise agreed or provided. the cost of any arbitration pmcedurc will be borne - (a) equally by the two(2) parties to the Dispute where it has been rcfkrredjointly by them, or otherwise, (b) by the unsuccessful party. 19.10 Where a Dispute has been refixred to the Centre fixarbitration then tie ,Parties to the extent practicable myotherwise exercise their rights and pertimn their obligations under this Agreement. Neither Rutyshall be entitled to exercise any rights or election arising in consequence of any alleged default by the other arising out of the subject matter of the Dispute until the Dispute has been resolved by the decision of the arbitrators. 19.11 A difference of view or disagreement may be Aimed by a hrty to a Sole Expert pursuant toClauses 3.3(c), 5.4, 6.4, 7.3, 8.8, 9.4, 12.4, 12.5, 12.8, 15l(d),16.5(b), 16.7, 18.6(c), 22.2(b) and 22.4(d) hereof. Where any difference of view or disagreement is refixred by a hrty or htiesto the Sole Expert, the other Parties shall have twenty (20)days to consent to such rekrral and upon the consent of all the parties the difference of view or disagreement shall be refkmd promptly upon consent. habsenceof consent in writing by all the parties, such difference of view or disagreement may be considered a Dispute pursuant to Clause 19.1. Any such rekrence may be made by a Rmy by notice served pursuant to Clause 24. 19.12 To the extent practicable, a party intending to make a rehence to a Sole Expert shall provide reasonable advance notice to the Rmy(s)of such intention and shall allow such Party@) to discuss tie basis fix such reference and affording a reasonable opportunity to such hrty(s)to take whatever steps itithey considers appropriate to remove the basis of the dispute. rekmdby an individualzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAFWyto the Sole Where any difference of view or disagreement is Expert, considerationof the difference of view or disagreement in question shall be initiated by the Party who is seeking considerationof the difference of view or disagreement by the Sole Expert submitting to both the Sole Expert and the other Rmy written materids setting fixth: - 36 - (ii) a statement of the submitting hty’sposition; and fL (iii) copies of ncords (if relevant) suppomngthe submitting Party’s position. 19.13 Where any difference of view or disagreement is referred by the Parties jointly to the Sole Expert, considerationof the differenceof view or disagreement m question shall be initiated by the Parties jointly by each party submitting to the Sole Expert and the other Party or Parties (as the case may be) the written materials referred to in Clause 19.12. 19.14zyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAWithin (ten) 10Business Days of the date that a htyhas submitted written materials to the Sole Expert pursuant to Clause 19.12,the other Party or Parties (as the case may be) may each submit to the Sole Expert: (0 a description of the difference of vim or disagreement; (ii) a statement of their position; and (iii) copies of records (if relevant) supporting their position. 19.15 The Sole Expert shall consider any mhnnation submitted by the mponding”Rmy/€?wies within the period provided fix in Clause 19.14 and, in the Sole Expert’s discretion. may considerany additional information submitted by any Party at a later date. 19.16 The Parties shall not be entitled to apply for discovery of documents but shall be entitled to have access to the other party or parties (as the case mybe) relevant records and to receive copiesof the records submitted by the other Party or Parties (as the case may be). 19.17 EachzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAParty shall designate one (1) person knowledgeable about the issue which has been refkrred to the Sole Expert who shall be available to the Sole Expert to answer questions and provide any additional information requested by the Sole Expert. Except for such person, a Party shall not be required to, but may, provide oral statements or presentations to tie Sole Expert or make any particular individuals available to the Sole Expert. 19.18 Except as provided in Clause 19.20with respect to the payment of costs, the detemnation of the Sole Expert shall be without prejudice to anyzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAParty and any evidence given or statements made in the course of this process may not be used against a Party in any other proceeding. The process shall not be regarded as an arbitration and the laws relating to commercial arbitration shall not apply 19.19 When a Sole Expert’s determination is initiated, the Sole Expert shall be requested to provide a determination within fifken (15) Business Days after the ten (10) Business Day response period provided in Clause 19.14abovehas run. If the Sole Expert’s determination is given within such fifteen (15) Business Day period, or if the SoleExpert’s determination is given at a later time and no Party has at such time initiated any other proceeding concerning the difference of view or disagreement, the hrties shall review and discuss the determination with each other in good faith for a period of ten (10)Business D deliver of the detemnation before proceeding with any other actions. - 37 - fb 19.20 ThecostszyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAof engaging a Sole Expert shall be borne by the umwcessful party. 19.21 The Sole Expert's determination shall be !inal and binding on the Parties save mthe case of rnanikst error. 20. LawApplicable 20.1 This Agreement shall be governed by and construed in accordancewith the laws of Zambia which the Parties acknowledge and agree includes, so firas they are relevant, the rules of international law. 21. Force Majeure 21.1 Any tidure on thezyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBApart of a Party hereto to comply with any of the terms, conditions and provisions of this Agreement (except any obligation of a Party to make payment of money to the other Party) shall not be grounds for temnation or give the other ktyhereto any claim for damages insobr as such arises from Force Majeure, if the first-mentioned Ruty: (a) has tienall appropriate precautions, due care and reasonable altemative measures with the objective of avoiding such failure and of carryingout is obligations under this Agreement; and (b) has given notice tothe other €?myofthe occurrence of Force Majeure on becoming aware of such an event. The firstmentioned Ruty shall tieall reasonable measures toovercome the Force Majeure and to fulfil terms and conditionsof this Agretment with the minimum of delay (provided that no Party has an obligation tosettlea labour dispute or totest the constitutionalityof any legislation or law) and shall given notice to the other Party on the restoration of normal conditions. 21.2 For the purposes of this Agreement, Force Majeure shall include war, insurrection, civil disturbances, blockades, riot, embargoes, strikes, lock-outs and other labourconfiicts, land disputes, epidemics, volcanic eruptions, earthquakes, cyclones, floods, explosions, fires, lightning, governmental restrictions, changes in applicable law or unavailabilityof materials or equipment and any other went which the party claiming force majeure could not reasonably be expectedtoprevent or control. 21.3 hthe event of any circumstances or went of a kind set out in this Clause 21 the period of time allcwed for the performance of those obligations or exercise of those rights which are delayed by such event of Force Majeure and the periods of time thereafter allowd for the performance of obligations or exercise of rights which are dependant upon the first mentioned obligations or rights, shall be extended by a period equal to the period during which such event of Force Majeure continues until the time of its settlement by agmment. 21.4 Where any period is, or is deemed to be, extended or any later datesubstituted for anearlier date under this Clause 21, that extended or substituted period or date shall be deemed to constitute the period or day referred to in this Agreement (notwithstanding tha t the timezyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA 46 * -38- R-. of such extension or substitution such period may haw expired or such date my he P==O. 22. Variation 22.1 The Parties may from time to time by agreement m writing add to, substitute for, cancel or vary all orzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAany of the provisions of this Agreement, the Approved Programme of Mining Operations, the LqeScale Mining Licences or any programme (including all of the Scheduled Programmes), proposal or plan approved for the purpose of more efficiently or satisfactorily implementing or facilitating the objectivesof this Agreement. 22.2 (a) Except as otherwise provided inClause 22.4, where NFCA proposes to modify or vary the ApprovedzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAProgramme of Mining Operations (hereinafter called a "Modikation")and by such Modification NFCA would not be in substantial compliance with the Approved Programme of Mining Operations NFCA shall provide notice of such Modification to GRZ. Such Modification shall be deemed to be approved by GRZ and the Approved Programme of Mining Operations shall be amended to the extent necessary to reflect such Modification unless GRZ within ninety business days of the notice being given to it notifies NFCA that GRZ considers the Modification to be a Major Change. If NFCA accepts that the Modification is a Major Change it is deemed that notice has been given pursuant to Clause 22.4(a) on the date GRZ gave notice it considered the Modification is a Major Change. (b) If NFCA does not agree that the Modification is a Major Change then it myrekr to the Sole Expert in accordance with Clause 19, the question whether the Modification is a Major Change. If the Sole Expert detemnes that tie Modification is a Major Change then it is deemed that notice has been given pursuant to Clause 22.2(a) as of the date of the Sole Expert's decision and the provisionsof Clause 22.4(b)to (e), inclusive, apply, unless NFCA has implemented or commenced implementation of the Major Change. If such implementation has occurred or commenced then the Sole Expert shall also determine: (i) what action NFCA must tie; or (ii) what compensation NFCA must pay and to whom such compensation shall be paid. If a Sole Expert determines that the Modification is not a Major Change. such Modification shall be deemed approved by GRZ and the Approved Programme of Operation shall be amemded to the extent necessary to reflect such Modification without further variation or payment of compensationby NFCA. 22.3 For tie purpose of this Clause 22, a proposed Major Change to the Approved Programme of Mining Operations means a proposed material change mlving the elimination or material dilution m the capacity of the Facilities or in the mine plan or mine production schedule ifa consequenceof such proposed material change would be to materially reduce or materially delay receipt of GRZ'szyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAtax revenues or royalties derived from - 39 - \ operations or m a material respect adversely impact or increase the adverse impact of NFU's mining activitieson the envimnrncnt. 22.4 No Major Change shall take effect unless it has been approved or is dmndto have been appmved by GRZ and where NFCA intends to make a Major Change the fidowing pmisionsshall apply - (a) NFCA shall, by notice toGRZ of tie proposed Major Change, give full details mc~udmgan economic analysis of the proposed Major Change entitled "Proposed Major Change to the ApprovedzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAProgramme of MmqOperations"; (b) if GRZ doesnot notify NFCA that it objects to the Major Change within thirty (30) daysof the notice, GRZ shall be deemed to have approved the Major Change; (c) where GRZ requires additional time to evaluate the Major Change, it shall within the thirty (30)days stipulated in Clause 22.4(b), extend the period by m additional thirty (30) days and if withii that thirty (30)zyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAdqzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAperiod GFU does not notify any objections it shall be deemed to have approved the Major Change; NFCA ofzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA (d) where GRZobjectstothe Major Change and NFCA considersthe objection to be unreasonable, NFCA myelect to &r the question of the reasonableness of GRZk objection to the Sole Expert under Clause 19. h assessing the reasonableness or otherwise of GRZ's objections the Sole Expert shall have regard to the impact which withholding approval to the change would have on the economic viability of the project, as well as the impact on GRZ revenues; (e) if the Sole Expert determines that GRZ's objection is unreasonable, GRZ shall be deemed to have approved tie Major Change. 22.5 Where GRZ approves or is deemed to have approved a Major Change, the Approved Programmeof Mining Operations shall be varied or amended to the extent necessary to reflect the Major Change. 22.6 For tie purposes of this Agreement, a reduction in the number of employees of NFCA shall not in and of itself, constitute a Major Change. 23. Consultation 23.1 (a) A Committee shall be formed, comprising of one member from each of the Ministry, NFCA and the Municipal Council and chaired by a representativeof the Ministry of Labour, which shall have no powers tobind NFCA but shall monitor theimpiemcmationoftheTraining and Human Resources Management Programme. (b) This Committee shall operate during the term of this Agreement and NFCA shall furnishit with quarterly reports outlining the progress of the Training and Human Resources Management Programme,problem encountered, positions filled and the number of local people employed. -40- 23.2 (a) ACommittee shall be fcmned, comprised of one member kmeach of the Ministry of Mines andzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAMinerals Development, the local Gcwmmm and NFCA and chaired by a rcpnsentatk of the Ministry of Commerce, Trade &L Industry, which shall have no powers to bind NFCA but shall monitor the supply and procurement of goods and services to the Project. (b) The Committee shall operate during the term of this Agreement and NFCA shall furnish it with quarterly reports comprising the following information: (i) a list of succesdul tenderers which shall include the item supplied, residence of tendems and the reasons for awarding the tender; and (ii) a list of unsuccessful locally based tenderers which shall include reasons brnot auarding the tender. 24. Notices 24.1 (a) Any notice, consent, demand, approval or other communication (a "Notice") required or pemtted to be given shall be deemed to have been given if: (i) in the case of a Notice given by GRZ. such Notice is signed on behalf of GRZby either the Minister or Rmnanent Secretary tothe Ministry as their respective responsibilities require; or (ii) in the case of a Notice to be given by NFCA, such Notice is signed by a director or by the Secretary of NFCA. (b) Each such Notice shall, as elected by the h-tygiving such notice, be personally delivered or transmitted by telex to the other Party as follows - ANoticeto GRZ If by facsimile - Ifbyhmd- kmnanent Secretary Permanent Secretary Ministry of Mines Ministry of Mines and Minerals and Minerals Development Development +2601251244L252916 POBox 31969 Haile Selassie Avenue Lusala, Zambia A Notice toNFCA If by facsimile - Ifbyhand- The Secretary The Secretary Mr Ma h Ping Mr Ma h Ping +260 1 235350 doBank of China Ben Bdla Road POBox34550, Lusaka 24.2 Except as otherwise specified herein, all Notices and other communications shall be deemed to have been duly given on the earlier of: (i) the date of receipt if delivered personally; and (ii) the date of transmission with confinnedamvmback if transmitted by facsimile. Either hnymay change its address by Notice to the other hrty in accordance with the provisions of this Clause. All Notices and all documents or mtrumnts delived in connection with this transaction shall be in the English language. 24.3 Where NFCA is required to submit any plans, proposals or other material for the approval of GRZ,the date of submission shall be deemed to be the date on whichzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAGFtZ received the said plans, proposals or other materials. 25. Wither 25.1 The failure of any hrtyto enforce at any time any of the provisions of this Agreement shall in no way be construed to be a waiver of the pnwision or any part thereof or the right of any Party thereafter to enfixce each andzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAevery part of tie provision in respect of any subsequent default or breach. 26. Severability 26.1 The provisions of this Agreement shall be separateand severable each from the other to tie extent that if any portion or any one provision or portion is deemed to be inoperative then tie reminderof this Agreement shallremain binding upon and enforceable by the Parties hereto. Nothing herein shall preclude one Party from requesting the otherzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAParty to renegotiate any provision herein. 27. Further Acts 27.1 The Parties shall execute such documents and do and perform such acts that lie within their povmand are necessary to give fulleffect tothis Agreement. 28. Counterparts 28.1 ThisAgreement may beexecuted in any number of counterparts, each of which executed shall be deemed to be an original, and such counterparts shall together constitute one Agreement. 29. Representations and FVarranties 29.1 Except asexpressly stated in this Agreement, no representation, inducement or warranty was, prior to the execution of this Agreement, given or made by one of the krti herem with thezyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA q!Jf - 42 - k* intent of including tie other htyto enterzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAinto this Agreement, and my representations, inducementsorwarrantiesthat may have been so gimare herebyzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAdenied and negated. - 43 - INWlTNESSWHEREOFthisAgmmcnthasbecndulycxecutdbytbeMcsonthe 2q*zyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAdayof 34NE 9 19qzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA8 SIGNEDfbrandonbehalfofthe 1 GOWRNMENTOFTEE 1 REPUBLI,FZAMBIA 1 THECOMMONSEALof 1 NFCAF'RKAMININGPLCand ) hereunto ailixedby authority of the 1 Board of Dhctorsm the presence of ) - TEECOMMONSEALof 1 CHINANONFERROUSMETAL ) INDUSTRY'S FIDREIGN ENGINEERING ) ANDCONSTRUCIION CORPORATION) GROUP) 1 hereuntozyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAiixed by authority of ) the Board ofDirectors 1 mthe presence of 1 Director DirectodSecrebq scFIEDm l APPROVEDPROGMMMEOFMININGOPERATIONS . . NFC Afiica Mining PLC ("NFCA")will, within 4 years of the date of this agreement, have ore production levels at betwxn 5,250and 6,000 tomes perzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAday, and contained copper in concentrate at between 35,000 and 40,000 tomes per year. NFCA will carry out the fbllowing programme of mining operations to bring Chambishi Mine back into production as early as possible. Yesvl (starthg€tomthe dateof this agreement) e haeasecompressedaircapacity to a level which satisfies the existing Cobalt and Acid Plant demand and futureunderground mine requirements. e Equipand commission tie 948 level pump station. e Start dewatering drilling above 900 level. e Carry out underground exploration drilling above 900 level. e Carry out repairs tothe 972 loading box. e Award contract to start primary development on the 900 level. e Start development and trial mmng above 500 level. e Start surface exploration and in-fill diamond drilling. e Re-install materials handling infrastmcture on 548 level. e Rehabilitate572 loading station. e Someand replace rock winder drum shells. Check and refurbish if necessary the braking and control systems on both the rock and service winders and return safe skip capacity to 17 tomes. e Upgrade mine ventilation system above the 500 level. e Repair mrerhead orehasteconvcyw between No. 3 shaft head frame and orehastebins. e Remmtecoreshed, mining. geological and engineering offices and prepare capital stores to receive equipment for rehabilitation of concentrator and construction of backfill plant. Year2 e Continue primary and start some secondary development on 900 level, and start primary development on intermediate levels above 900 level.zyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA 4F - 45 - l Continue minedewatering programmeon 900 level and above.zyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA k l Continue exploration ofzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAChambishi RkstzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAresource. 0 Continue underground exploration drill@. l Award civils and mxhanical contracts fix the rehabilitation of the concentrator and construction of the backfill plant. 0 Rehabilitate the surface conveyor system transporting ore from shaft bin to concentrator live stockpile. 0 Award contract to mine an additional fksh air intake to 900 level. 0 Start mining of ore above 500 level in east of mine and stockpileon surface. 0 Achieve meproduction level of 3,000tomes of ore per day. Year 3 0 Continue underground development on 900 level and intermediate levels above 900 level. l Continue underground dewatering and exploration drilling. 0 Continue mining above 500 level and stockpile ore on surface. 0 Award electrical and instrmentation contracts for concentrator and bactill plant. 0 Award contract to install underground bactill delivery system. l Commission concentrator at 5,250tonnes per day throughput using ore stockpiled on surface. 0 Start mining updip from 900 level and begin hoisting ore to surfice. 0 Commission backfill plant and underground backfill delivery system. Year 4 0 Continue surface exploration drilling programme to increase mine resources. 0 Continue mine dewatering programme. l Continue primary and secondary development above and below 900 level. 0 Continue underground dewatering and exploration drilling programme. 0 Maintain underground production at between 5,250and 6,000tonnes perday. - 46 - k m Prepare ddkclkasibility study to bankable document level brChambishi West deposit if viable which would envisage total mine production level of 9,000tomes of ore per day. Year5 m Maintain mine production level at between 5,250and 6,000tomeszyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAper day. m Start stripping for Chambishi West open pit if project goes ahead.zyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA l Continue miningupdip tmauds500 level. NFCA will, withinzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAtwo (2) years of the Completion of tie Sale and Purchase Agreement, submit m updatedApproved Programme of Mining Operations for approval by GRZ and the Ministry of Mines and Minerals Development. - 47 - scEEDuLE2 \ Pm1 %* ENVIRONMENTALPLAN NFC Afiica Mining PLC (NFCA) will from the date of this Agrement adopt, and commit to, in terms of resources, the ZCCM Environmental Impact Statement (EIS) issued in March 1997, fixall enviromnental issues relating to the operation of Chambishi undeqpund copper mine, concentrator and associated facilities, but not those relating to the operation of the Chambishi Cobalt and Acid plant. h accordance with the provisions of the Mines and Minerals (Environmental) Regulations. the EIS will be updated by 30 Septernbcr 1998 after an mdependent environmental audit is conducted. Within 3 months of the completion of the EIS NFCA will prepare an Environnmtal Management Plan which will be submitted to the Ministry of Mines h apprcwal. At such timt NFCA will also submit, m the light of their new EIS. a set of revised l3wimmental Clean-Up Obligations to GRZ fixtheir approval. Further, NFCA undertakes to employ an environmental officer as provided fixby the said Regulation. NFCA also acknowledges the concluding decommissioning and closure costs applicable to Chambishi mine, concentrator and associated facilities which mount to US$1,601,000 (comprising Underground Workings $230,000; Plan Area and Buildings $914,000; and TD19 Musakashi Dam $457,000). NFCA further undertakes to meet the Environmental Protection Fund Obligationscummly envisaged to be 520%of the concluding decommissioning and Closures costs, payable over 5 years, as provided for in the Mines and Minerals Act. The NFCA Environmental Plan shall comply in all respects to the requirements of the Mines and Minerals Act Legislation. /l' -48- Pm2 ENVIRONMENTALCLEANUPOBLIGATIONS ProgressiveRehab. ACtiVitieS 1997-2016 U Mh=Compnent US Archaeological protection of six sites. 22,ooo Decommissioning of old structul-es. ~~~ ~ Opem Pit Workings 3.000 used tiles to be used to prevent inadvertent access to the own pit. Overburden, waste rock and 1,304,000 Construction of perimeter low grade ore dumps bundwall to arrest solids in surface runoff. Extent of budwall tobe assessed. Plant Area and Buildings 26,000 Access soil contamination, demolish selected plant building and revegetate some areas. ~~~ ~ ~~~~ Tailings Facilities:- Construct toe bundwalls to Dumps 7, 7A. 8. 10, 13, 15 contain solids in surface and 17 runoff and revegetate upper 11 Tailings Facilities (cont.) surhces. 310,000 Diversion of Chambishi TD6 stream around TD6, create evaporation paddock and revegetate upper surface. TD16Luano tailings dam 242.000 Upgrade spillway and monitor. Surhce Water Management Facilities Wemers Dam 285,000 Construct toe bundwall and megetate (subject to reclaim studies). - 49 -zyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA 4y E Mine Component ProgressiveRehab. 1997-2016 US New Dam 5.000 Assess spillway nquirements. "D6Feed channel 100,000 Streamclean up/dredging Musakasti stream 50,000 Stream clean up/dredging Totals L NFCA will, as provided for by the above stated Regulations annually amend or update the Environmental Plan and, or the Environmental Clean Up Obligations to reflect changes in its operationsand other circumstances, especially as the mine is brought back into production, and with reference to the follcwing Key Aspects List. Changes will conform to specifications and practices established by Zambia standards for management of the environment as it is affected by mining operations. Environmental Safeguards- Key Aspects Key aspects of the Environmental plan for the rehabilitation and reconstruction of the mining operation at Chambishi include protection of the environment, public health and sakty; minimising environmental impacts; and allowing for a productive post mining land use or an acceptable alternative following cessation of the mining activities. Specific measures that will be taken to safeguard the environment during the feasibility study stage will include: There will not bezyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAany liquid efhents discharged tosurface water. An Erosion and Sediment Control Plan will be prepared, and all dirt roads and drill sites will be constructed and maintamed so as to ensure adequate drainage to prevent damage to soil, water or other resource values. Amanagement plan will be developed for handling, storage and disposal of any chemicals and reagents. Any hazardous (reactive, flammable, radioactive, corrosive or toxic) materials will be stored in clearly labelled containers at a designated and secure location. Hazardous wastes will be disposed of in a manner consistent with local regulations Secondary containment and fireprevention systemwill beprovided for all petroleum product storage. A reclamation plan will be prepared and implemented, with the objectives of returning the land to conditions capable of supporting productive land uses. All surfxe disturbances resulting from feasibility study activities (cg, but not limited to, surfkcdiamond drilling) will be fully reclaimed. To the extent possible, reclamation activities will be concurrent with fkasibility activities. Reclamation will include all newly constructed access roads, drill sites and mud pits. 0 All drill holes will be plugged or capped at tie surfke to prevent possible ground water contamination, and to prevent possible injury to tie public, livestock or wildlife. 0 Asite envmnmentalmonitoring programme will be conducted during the rehabilitation and reconstruction of the mining operations at Chmbishi to monitor possible environmental impacts and to characterise the mine site and receiving envirmment. The monitoring programme will include air quality, surface and ground wterquality and meteorology. All environmental monitoring information will be maintained in a computer database management PW-. - 51- rcHEOULE3 . . ., k- .-zyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA /- 3 c d, Q-. A 'j .zyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA 1zyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAI, , .. \ .-- .' . . .'. - . . - 52 - PARTII MININGAREAzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA SITE PLAN FOR NFC ZAMBIA COPPER MINES PLC MINING LICENCE AREA CHAMBISHI LML l27, LML 28, LML 29 SCALE 1 : 120 ooo r--- -*\. . . /’ .. Iy L = 7 -1- / .-. P.-=.J (3- -\ I I-- SmJtizyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAc MA&-:.. MINING SURVEYOR /$....... 3ppr ...... MINES DEVELOPMENT DEP - 53 - scHEDuLE4 TRAININGANDHUMANRESOURCJ3S MANAGEMENT PROGRAMME Chambishi Mine is currently operathgon meand maintenance only and NFCA will sustain this as a baseline minimumlevel of activity fixthe duration of the mine and concentrator rehabilimtion. As no obligation m terms of Human Resources Management is being inherited from ZCCM (compared to the other operating mines), NFCA kels that it is appropriate to offer a provisional document covemg their Training and Human Resources Management Programme, at this stage. NFCA shares the viewpoints of the GRZ with respect to the reqming and development of the Chambishi Mine that it should achieve the folltxving broadly defined objectives: e Development and exploitation of the project will be of major economic significance to the people of Zambia; e Must ensure project secures maximum benefit for and adequately contributes to the advancement and social and economic welfiue of the Zambian people, especially in the vicinity of Chambishi and the rest of the Zambian Copperbdt, in a manner consistent with their needs and the protection of the environment and which secures an appropriate return on investment commensurate with the risks involved toNFCA. NFCA will conduct a full investigation into the manpower requirements fixthe project which will include training and development. The following ten key points will be incorporated into the Training and Human resources Management Programme which will evolve from this study. NFCA is committed to reopening Chambishi Mine as a flagship operation for the region where employees are properly trained, well motivated and proud members of a successful and contented workforce. NFCA believes the key to achieving this aim is by releasing the potential of the local Zambian workforce to the maximum. NFCA is committedto the very highest safety standards and as such safety training will be mandatory fixallemployees as part of their induction and on an on-going basis toensure that each individual is aware of his own safety, the safety of persons around him and the safety of all persons working under him. During the project construction and pre-production, including the continuation of care and maintenance operations at Chambishi Mine, NFCA will maintain a minimum workfbrce of approximately 140 persons (such workforce may comprise both NFCA direct employees and contractors). When Chambishi Mine is in full production NFCA will maintain a minimum workfbrce of 866 persons, comprising direct emplqees of NFCA and contract labour. -54- 0 NFCA will not discrimhate in ifs rrcruitment, selection, promotion and assignment of personnel. 0 NFCA may recruit from time to time, non-Zambian citizens, where in the judgement of management they are required to carry out specialised operations fix which skills are not available locally, or fix local trainingpurposes. Such recruitment will comply with Zambian immigration laws with tie undersmdmg that GRZ will not hamper the continuous and efficient perfixmance of NFCA. 0 NFCA will take all reasonableefforts to attract qualified Zambian citizens working overseas back to Zambia. 0 When Chambishi Mine is in full production NFCA will establish a Consultative Committee to monitor its Training and Human Resources ManagementzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAProgramme, in conjunction with representatives from local and national government. 0 Zambian citizens m management positions will be given exposure to overseas operations as an integral part of their development. 0 NFCA will comply with all Zambian labour laws. NFCA will recognise the MUZ forzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA collective bargaining purposes and agrees to be bound by the existing conditions of service and the Collective Agreement with the MUZ. NFCA will recognise the terms of any individual contracts to be transferred from ZCCM at closure. l NFCA will submit a detailed Training and Human Resources Management Plan, covering all categories of emplqees, for approval by GRZ, Ministry Development, within 12months of Completion of this Agreement. - 55 - SCHEDULE5 LOCALBUSINESSzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBADEVELOPMENT PROGRAMME Chambishi Mine is currentlyoperating on care and maintenance only and NFCA will sustain this as a baseline minimum level of activity for the duration of the mine and concentrator rehabilitation. As no obligationmterms of participation in thelocal business community is being inherited fromZCCM (compared to the other operating mines). NFCA kels that it is appropriate to offer a provisional document covering their Local Business Development Programme, at this stage. NFCA shares the viewpoints of the GRZ with respect to the mpening and developmnt of the Chambishi Mine that it should achieve the following broadly defined objectives: 0 Development and exploitation of the project will be of major economic significance to the people of Zambia. 0 Must ensure project secures maximum benefit for and adequately contributes to the advancement and social and economic welfare of the Zambian people, especially in the vicinity of Chambishi and the rest of the Zambian Copperbelt, in a manner consistent with their needs and tieprotectionof the environment and which securesan appropriate return on investment commensurate with tie risks involved to NFCA. NFCA will conduct a full investigationmto the proactive development and establishment of the local business sector. The following key points will be incorporated into the Local Business Development Programme which will evolve from this study. 0 NFCA will employ full time staff experienced in setting up and managing small businesses to undertake the following; - assist Zambian citizens to set up businesses to service NFCA. - assist in tie implementationof the Local Business Development Programme. - liaise with GRZ. - compile and maintain a register of local suppliers of goods and services. - advise and assist the establishment of long term business enterprises. NFCA will actively encourage and assist the establishment of businesses in Zambia (particularly in the Copperbelt and with a particular emphasis on businesses directly or indirectly majority owned by Zambian citizens) to supply materials, equipment and services toNFCA. NFCA will conduct an annual review of progress being made on the implementation of the Local Business Development Programme and make variations to it as required by changing circumstances. NFCA's procurement activities will be conducted in a fair, open and transparent manner. 4T e-56- 0 NFCA will identify and invite registration of businesses m Zambia (particularly in the Copptxbelt and withaparticularemphasison businesses directlyor indirectly majorityowned by Zambian citizens) whichzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAare capable of supplying materials. equipment and services to NFCA. Thisregister will be reviewed annually. 0 NFCA recognises tie availabilityof a pool of suitably qualified mine workers follcnving thezyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA privatisation of ZCCM and the downsizing of the company’s operations at, inmalia, Mufdira Mine and undertakes to assess and, if appropriate, encourage the employment of such minewwkers at its operations. l NFCA will forma ConsultatiwCommittee comprising reptmtatiwshmNFCA,national government and local government to monitor the supply and procurement of goods and services to the Project. The committee willzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAreport quarterly on, inter alia, details of successful tenderers, and details of unsuccessful local tenderers. 0 NFCA will submita detailed Local Business Development Programme fixapproval by GRZ, Ministry of Mines and Minerals Development, within 12months of the Completionof this Agreement. - 57 - SCHEDULE6 A PROPERTY INSURANCES 1.zyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAFue and€kr&Insurance; mrespectof physical loss, destruction ordamagetofixed assets of Buildiqp Plant and Machinery. 2. ProjdConstruction Insurance; h loss, damage or destruction of project works that may msefromcommencemnttoproject commissioning. B PUBLICLIABILITYDEURANCE Public, Employer’s Motor ThirdhrtyImumnces;against legal liability for death,disease orbodily injury to employees and the general public, lossor damage to their property. arising from the Companf~operations. C MARINEINsuRANcEs Imports Insurance; m respect of loss or damage to imported orders of machinery, equipment, materials and other goods, while thesezyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAare in transit from the supplier’s to the Company’s premises in Zambia. D CASH/MONEYINSURANCE Cash and Fidelity GuaranteeInsurance; in respect of pecuniary loss to the Company from loss of money or other forms of negotiable documents, including pecuniary loss from infidelityby staff in positions of trust. - 58 - SCHEDULE7 Q. PARTI-zyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAMEDICAL SERVICES INTRODUCTION The ChambishiMine operates under the Nkana Division of ZCCM which administers twohospitalszyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA all based in Kitw. Prior m the take over of Chibuluma Mine by the Metorex Consortium, the Division was responsible for a third hospital based at Kalulushi. The three hospitals thus made up the medical services which catered for all ZCCM employees based in Kitw, Kalulushi and Chambishi. Employees of ZCCM had a choice of three hospitals depending on where they lived. The hospitals are supplemented by clinics based m the townships in the three towns as well as the plant and works areas. cHAMBIsHI CLINICS Chambishi employees and their registered dependants residing at Chambishi are served by twoclinics one situated in the township and which caters for emplcyees registered dependants, while the other in the plant and work area caters for meemployees as well as ZAMDET employees, a ZCCM subsidiary company. Both clinics are run and maintained by ZCCM on 24hours services. They are staffed by ZCCM employees and visited three days m a week by doctors from Nkana Hospital or by arrangement from Kalulushi Hospital. The cost of running the clinics in the period April - October 1997are set out in the table below: - 59 - 'RIL TOOCTOBER 1997 CHAMBISHICLINKS(TOWNSHIPAND PLANT SITE) ACTUAL COST AGAINST BUDGET AzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA COSTELEMENT BUDGET ACXUAL K'000 K'000 IAICAL LABOUR (31) 95,037 90,298 DRUGS 3,249 7.486 SI'ATIONERY 56 108 CLEANINGMATERIAL 1,809 M2 366 OTHERM'KESHIRES 53,842 0 IWI'AL 154,359 98,303 ... , - 60 - All employeesofzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAChambishi Mine and their registereddependants arc entitled to ftee medical services and attend hospitals at Kalulushi and NkanazyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAand Nkana Hospital. ZCCM provides a bus service to emable dependants to visit the sick at Kalulushi Hospital and, an ambulance service is available at Chambishi to kny cases which need to be attended to by a doctor or for hospitalisation at Kalulushi or Nkana Hospitals. Emplayees have a choice to use the contributory or the non-contributory part of the hospital at Kalulushi or Nba. HOSPITALSERVICES Chambishi employees needing hospitalisation or specialised medical attention attend the Kalulushi or Nkana Hospitals. hthiszyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAreport, a full descriptionof the hospital servicesoffered by Nkana Division in Kitwe are set out below: NKANA MEDICAL FACILITIES HEALTHCARESERVICES Introduction Nkana Division has twHospitals, Nkana Hospital, which is high cost (i.e. Conttibutory) and Wusakili Hospital which is low cost (Non-Contributory). Employees of Nkana Division and their registered dependants are entitled to use the low cost Non- Contributory facilities at no cost. Employees and dependants wishing to use the high cost facilities are required to pay €2,000for employees and K400 for each dependant per month. Non mine personnel arecharged a commercial rate for use of the medical facilities at eitherof the Hospitals i.e. K4.500 membership fee for both hospitals and K93400and K37,OOOas pre-payment fee for Nkma and Wusakile hospitals respectively. Nkana Division provides Curative and Preventive Health Services. This is to meet the objecthdmssionof the Medical department which is to "provide quality health services to miners and their dependants. SUMMARYOF HEALTH SERVICES PROVIDED ATTHE HOSPITAL The follmving services are provided by ZCCm hospitals to serve mine employees, their dependents and others: a) CLINICALSERVICES Surgery, Internal medicine, Paediatrics, Obstetrics and Gynaecology. Orthopaedic surgery, Anesthesia, Ophthalmology, Dental and Accident and Emergencies) b) CmiERSPECIALISED!3ERWCES Intensive Care Therapy, Computed Tomography Scanner and Ultrasound (only at Nkana Division), Radiology and Hiopathology (only at Nmq'Ij. - 61- c) MATERIALANDcHILDHEALmI!3ERvIcEszyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA Immunisation, Anotnatal~,Post Natal, Family Planning Numtion Surveillance and Home Based Care for HW/Aidspatients and the terminally ill. d) CYIIER PUBLICHEALTH LABORATORY S- The Medical department has 610 employees and those comprise the Medical Doctors, Nurses and Paramedical Staff. The Medical departmenthasanEstablishmentof 38 Medical Doctors outof which 14 are inConsultant Positions. TheseConsultant positions are in the hllowing disciplines;Internal Medicine, General Surgery, Orthopaedic Surgery, Paediatrics, Obstetrics and Gynaecology, Ophthalmology, Radiology and Histopathology. The other 24 positions are General Medical Officers at various levels of experience. The Manning level for Nursing Staff is 323. TheseNursing Staff areeither Enrolled Nurses or Registered Nurses. Other Nurses arein Specialised fields, like Theatre Nursing, Intensive Care Nursing etc. The Supportive Paramedical Staff include Radiographers, Pharmacists, Laboratory Technologists, Physiotherapists, Clerical and Maintenance sections etc. BEDCAPACITY The current bed capacity of tie Hospitals are broken as hlluwx- Adult Cribs/ Incubators Delivery Total vpe Beds cots Beds Nkana Hospital 67 12/18 1 101 Wusakili Hospital 248 22/43 2 332 Intensive 5 0 0 6 CareWusakili Total Medical 320 34/61 l 3 439 Facilities * -62- Rwamedical services Laboratory Services- The Central Medical Laboratory is at Wusakili. It is a well equipped laboratory with modem diagnostic equipment. The laboratory has the biochemstry, MicrobiohgyBerology, Haematology, Histopathology and Blood Transfusion Services. All these sectionsare headed by trained staff. The excellence of the laboratory is consistently monitored by the Local and International QualityControl krformance. Pharmacy:- The maindispensary and storage for Pharmaceutical drugs is housed at Nkana Hospital. The Pharmacy also does local manufacturing of cough mixtures etc. Radiography:- Nkana Hospital houses the CT Scanner computed Tomographic Imaging Centre, some of the examinations donezyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAare Brain Scanning and general Ulna Sonography. This section is manned by Radiographers and is headed by two Radiologists. Dental Services:- Nkana and Wusakili hospitals, have a dental cliniceach. Wusakili Dental Clmc caters for all general dental cases while Nkana Clinic specialises in Orthodontic dentistry. Catering Services- Nkana hospital provides choice meals on a varied menu bais. Patients are accorded the pkameto decide their mealsunless their ailment disallows. The kitchen is spacious with cold rooms and cooking facilities. Intensive Care Unit:- Wusakili hospital houses the only Intensive CareUnit. It has five beds and one crib catering forboth hospitals. This facility is for criticallysick or injured patients needing life support. The Intensive Care Unit isspacious with modem lik support machines such as new port ventilators and the bedside central monitors. Laundry:- All the cleaning of linen and patients garments are done here. Transport:- Wusakili hospital operates the ambulances and general call out vehicles. The ambulances are fitted with radio communication systems. These are controlled by the Switchboard Operators at Wwakili. Radiology:- Wusakili hospital caters for general Radiography. Nkana runs the computed Tomographic services (CT Scan) which is the only one in the country. Theatre:- Wusakili hospital has a large theatre with autoclave machines. It caters for theatre cases for both hospitals. Nkana theatre is closed. Physi0theraphy:- Like Nkana, Wusakili hospital has Physiotheraphy electrotherapy and physical exercise facilities. &!kA \ - 63- Reventive Semces TheDivisionruns 14M.C.H. clinics in the residential areas and 5 clinicsat Plant Site Clinics. The residential clinics are mainly concerned with general screening of female and children patients, matemaland child services(ante-natal) and Immunisation services forchildren under 5). Nutritional Surveillance,zyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAcookery demonstration,Family Planning and Home Based CareServices for HIVIAIDS patients and the terminally sick. All patientszyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAare encouraged to attend the nearest clinic when they are ill to decongest the Hospital Out Fatients services. Plant Site Clinics:- These offer First Aid services to accident victim and also deal with minor ailments to miners. Seriousconditionsare referred to the hospital. OU'IFATIENT ATI'ENDANCE Contributory 1993194 1994195 WE+/96 Mine Employees 10608 10117 11025 Mine Dependants 27514 17157 35923 Non Miners 5432 5122 5684 Total 43554 32396 52633 Non-Contributory 1993194 1994195 1999% Mine Employees 19960 161 15 13917 Mine Dependants 49631 36434 33313 Non Miners 5467 4503 5031 Total 75058 57052 52261 HOSPITAL ADMISSION Contributory 1993194 1994195 19951% Mine Employees 772 579 663 Mine Dependants 2390 1813 2036 Non Miners 976 703 831 Total 4138 3530 3wiY -64- l993D4 19!W95 1999% Non-Contribtioxy Mine Empbyees 2791 2802 2353 Mine Dcpendants 10845 10341 9225 Non Miners 2459 2357 1988 Total 16695 15500 13566 Bed Capacityand Occupancy Contributory 1993/94 lW4/95 MW% 1996197 Average Bed Occupancy 39 38.9 41 40.1 Average Stay of Patient 3.84 3.46 0.58 3.16 (day) 29.1% 27% 3.7% Bed occupancyRates %zyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA 36.9% Non Contributory 1993/!M 199495 1!@5/% . 1996l97 Average Bed Occupancy 180 175 168 160 Average Stay of Patients 4.6days 4.5 4.63 4.6 54% 53% Bed Occupancy RateszyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA5% 50% 48% Summary of HospitaldClinics Attendance for the Last Three Years is as fbllows: 1993l94 1994195 1995196 Mine Employees 27,159 25,264 17,989 Mine Dependant 55,328 66,867 60,183 Non Employees 12,164 10,139 8,437 %of Non Employees 44.7% - 65 - TABLE 1 HOSPITALzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAA'ITENDANCES FOR ZCCMzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAAND SUBSIDIARYCOMFANIES(l!") ZCCMLIlmTED DMSIONIPT. TYPE (NO.) NKANAWUSAKILE EMP DEP WORKING 10,962 55.61 1 RETIRED 230 MEDICAL DISCHARGE 203 INTER DIVISIONAL SUB!SIDIARY MPELEMBE DRILLING 699 l,o@l , NDOL4LIME SCAWLIMITED 41 192 TECHPRO 51 278 OTHER (SPECIFY) MU2 40 232 mAL 12,226 57,317 TABLE2 OPDA'lTENDANCES(1996/97) PATIJm"TYPE Facility Mine Dependants Inter Non-Mine Ex-Miners Type Employees Div. NRP (MD& R/E) NKANA LOW 13,844 36,371 8,325 736 5,771 1923 HIGH 8,612 19,140 101 410 4,108 20 mAL 22,456 55,511 8,426 1,146 1943zyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA Ay - 66 - HOSPITALzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA ESWBLEHMENTOFDCXXORS CHEFMEDICAL OFFICEWGROUP MEDICAL ADVISER 01 SENIOR CONSULTANT OKTHOPAEDIC SURGEON 01 SENIOR CONSULTANT PHYSICIAN 01 GROUP PHYSICIAN OCCUPATIONAL HEALTH 01 GROUP CONSULTANT RADIOLOGIST 02 CONSULTANT SURGEON 02 CONSULTANT PAEDIATRICIAN 01 CONSULTANT ANAESlXETm 02 CONSULTANT OBSGYNAECOLOGY 01 CONSULTANT PHYSICIAN 01 CONSULTANT PATHOLOGIST 01 DEPUTY CHIEFMEDICAL OFFICER 01 GROUP SPECIALIST OPHTHALMOLOGIST 01 SPECIALISTSURGEON 01 MEDICAL OFFICER 19 INTERNEEDOCTOR 02 ESTABLISHMENTOFNURSES 323 SENIOR PHARMACIST 01 PHARMACIST 01 PHARMACY TECHNICIAN 07 SrOREKEEPER MEDICAL !?IDES 01 PHARMACY ORDERLY 01 TOTAL 11 MEDICALPATHLAB CHIEFLAB TECHNOLOGIST 01 SECTIONALLABORATORY TECHNOLOGIST 04 LABORATORY TECHNOLOGIST 07 BLOOD TRANSFUSION OFFICER 01 SECRJ2TARYl"YPI.S" 01 MORTUARY ASSISTANTS 03 ORDERLYLABASSISTANT 01 CLEANEWATTENDANT PATH LAB 01 mAL 19 PHYSIUIXEFLWY PHYSIUI'HERAPIST IN-CHARGE 1 02 PHYSIUI'HERAPIST 4v 01 - 67 - Y RADIOGRAPHY RADIOGRAPHERzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA DMXARGE 02 RADIOGRAPHER 01 DARK ROOM ASSISTANT 02 lmAL 05 PUBLICHEALTH CHEFHEALTH OFFICERzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA 01 SENIOR HEALTH OFFICER 01 HEALTH OFFICER 01 HEALTH ASSISTANTS 02 CREW BOSS PUBLIC HEALTH 01 S'lWEMAN PUBLIC HEALTH 00 WATER SAMPLER 01 LEADING HAND PUBLIC HEALTH 01 SPRAYEWSEARCHER 07 REFUSE ATTENDANT 00 WIXL 17 DENTALSURGERY SENIOR DENTAL SURGEON 01 DENTAL SURGEON 01 DENTAL THERAPIST 01 CLERKRECElTIONIST DENTAL 01 DENTAL CLEANER 01 mAL 05 FIm AIDTRAINING SENIOR FIRST AID OFFICER 02 DEMONSTRATOIUTRAINING ASSISTANT FIRST AID 01 ORDERLY FIRST AID 01 mAL 04 CLINICS NO. OF BEDS HOUR!3 OPElWDAY J - CLINIC (CHAMBOLT) 24 HOURS C7-CLINIC (MUMANA) 05 24 HOURS NKANA EAST CLINIC 03 24 HOURS NKANA WESTCLINIC - 08 HOURS TWIBUKISHE CLINIC 03 24 HOURS MINDOLO11 06 . 68 MINDOLOI 07 24 HOURS MISESHIMATERNXTY 04 24 HOURS P-MATERNITY 02 24 HOURS PLANTSITECLINICS SOB CLINIC 24 HOURS CENTRALSHAFT 24 HOURS REFINERY 24 HOURS MINDOLOMAIN 24 HOURS MINDOLONOKlli 24 HOURS ADMINWTRATIVE HOSPITALADMINISTRATION,CATERING-RECORDS, CLERK ETC. 185 GRAND"L 610 - 69 - 'hble 1 PeoplezyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAexpected toweMedical bcilities postprivatisation * Fbunding error Source: Submissions from Chief Medical Officers NKANAHOSPITAL-MEDICALCOSTS'I0OCIOBER1997 - 70 - NKANAD"I0N MEDICALCOSE3TOzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAOCIDBER 1997 COSI' BY ELEMENT LOCALEMPLOYEESProfessionalStaff (Alphabetical Order) - 71- ChipondaCharlesDr Bsc (HB) MBBS (0Sh-l) Assistant Chief Medical Officer (Health ServicesManagement) Kabole MmpeMbewc(Dr) BscMBC~BMRCP- Consultant Paediatrician paediatrics UK A Maboshe htrick BscMBC~BMRCP- SeniorConsultant Physician Mwmawina UK Internal Medicine (Physician) Mulenga Henry (Dr) BSCMBChB MRCP - Consultant Physician Internal UK Medicine (Physician) Mutale Chola Baldwin (Mr) MDERCSHigher Senior Consultant Orthopaedic Surgical Training m Surgeon Orthopaedics orthopaedicsUK GDR Ngoma CharlesWeb(Dr) Bsc MBChB FRCR Consultant Radiologist Radiology Sendama John (Dr) Bsc MB ChB, FRCS I Specialist Ophthdmo~ogist London, FRCS I Dublin Ophthalmology Simukonde Musyani (Dr) Bsc MB ChB M Corn Group Medical Adviser and Chief HDip HSM (UK) Medical Officer, PublicKommunity Health, Health ServiceManagement Simwizye Tresphor BSCMBChB FRCS - Consultant Surgeon General Kapupula (Mr) UK SwFY Tembo Dixon Chaponda BSCMBChBFRCAI1- Consultant Anaesthetist Anaestesia m) UKDA-UK - 72 - EXPATRIATEEMPLOYEES NAME QUALIFICATION SPECIFICATION Desai H M (Dr) BDS. D Orth,RCs Orthodontic Dentistry MBBS Dip Chin Mh.MD Consultant Pathologist Goel R G (FVokssor)zyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA R3tho~ogy Histopathology Menon GK (Dr) MB BS DA Consultant Anaesthetist Anaesthesia he1CK(Dr) MBBS DD MRE NB Consultant Radiologist Radiology Sinha P (Mr) MB BS FRCS Consultant Surgeon Surgery Sathya Naathan (Dr) BDS Dental Surgeon Dentistry/Acupuncnm Rhloch M (Dr) PhD(University Medical Consultant ObdGynae School Warsaw) Obste%rics and Gynaecology LABOURDISIlUBUTION BYFTJNCI'ION CATEGORY LOCAL EXPAT TOTAL Doctors 34 7 41 Nurses 273 0 273 Rmmedicals 44 0 44 Administration Staff 153 0 153 Total 604 7 611 Table 1 OUTPATIEN'IS ATTENDANCE by Mine Hospital for Mine Employees, dependants, mterdivisiodand non mine b mRDMsIoNAL 101 8325 8426 NONh4lNE 287 1117 4108 6507 12019 mAL 2601 4676 31961 655047 104285 'hble 2 BEDCAPACITY,OCCUHNCYRATE(Averagestayinhospital,bedzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAoccupcy rate, inpatient days) By different Mine Hospitals NCHANGA NKANA FACILITYTYPE HIGH ww HIGH ww COST COST corn COST Bed Capacity 110 450 101 : 338 Average Stay in Hospital 5 6 4 5 Bed OccupancyRate 96 30 52 40 48 In Patient Days 7030 45630 11800 47462 "hble3 Admissionsby Mine Hospitals for mine employees, dependants, interdivisional and non mine NKANA FACILITY TYPE HIGH LOW HIGH .LOW 'KYI'AL Mine Emplqees 26 121 526 zin 2785 Mine Dependants 88 538 1864 8559 11049 Non Mine 53 202 405 1301 1961 Interdivisional 59 81 140 --74- PEOPLEzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAEXPECI'ED 'I0 USE MEDICAL FACILITIES POST PRIVATI!W'ION at Mine Hospitals 11 DMSIONALPTTYPENO. NGA T NKANAr 7l 5 NCH USAIULE EMP DEP EMP DEP , Wxking 8,766 20,153 10,962 55611 Retired 12 230 Medical discharge 20 203 Inter Divisional 9 SUBSIDIARY Mpelembe Properties Mpelembe Drilling 331 1,655 699 1004 Prosec (Z) Limited Ndola Lime Techpro(2)Limited Ndola Copper Refinery ZAM DET Scaw Limited 51 278 MU2 40 232 Others 1,352 4.056 10,490 25,864 12,185 57.125 LEGEND: Emp = Employez, Dep = Jkpendantofemployee - 75 - PmII-EDUCATIONzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBASERVICES ZCCMNkana Division mm two primary schools, one m Kitwe and tie second school at Kalulushi which has since been tahover by tie Metorex Consortium. There are no ZCCM schoolszyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAat Chambishi township. Employees’ children and dependants attend local (govemment) primary schools and a junior secondary school at Chambishi. The majority of secondary school children attend the secondary school mKalulushi. ZCCM pmvides a bus service to employee’s children and dependants attending secondary school education (Gwernment schools) in Kalulushi. Estimated cost of this bus service is K100million per annum. EDUCATIONFACILITIES (NKANAPRIMARY SCHOOL) School Enrolment = 87q920in1998) Number of classes = 32 (34in 1998) Number of Teachers= 42 Administrative Staff = 03 Breakdown of Stiby Grade ADMIN TEACHING SUPPORTmAFF mAL !mm? STAFF G12 G11 G1 G2 G3 G4 G5 G6 G7 G8 3 0 22 20 0 9 2 0 2 8 66 Typeof syllabus bllcnved: Basic Zambia Primary Course High Quality cost-effective education is offered. NB: 1. W111 be recruiting 5 Class Teachers and 1 Computer Science Teacher by November 1997. 2. W111 lose on Class Teacher on transkr to Nkwaz Primary School in Lusaka at end of thiszyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAterm. - 76 - PARTzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAIII - RECREATIONALSERVICES socIAL!mRvKEs There is one Social Club run by ZCCM through a Club Committee and also twoother clubs which operate autonomously. (The details of which are set out overleaf). All these clubs are m the Council area but use ZCCM facilities. Services provided by ZCCM are mm,electricity. general maintenance of the buildings, lawns and surroundings. Thecompany provides assistance to a number of youth programmes and youth clubs who are suitably registered under Community Services. The services provided include transport fix outside sporting activities, accommodation expenses for team members and officials, the sports kits and where necessary registration and tiliationfees with National Sports Bodies. The detail and cost of these social services to ZCCM is shamin the table set out below: - 77 - NKANADIVISION/ CHAMBISHI MINE COMMUNITYSERVICES DETAILS OFSOCIALANDMUNICIPAL SERVICESAT THECHAMBISHI MINE ASAT 9 DECEMBER 1997 SOCIALCLUBS CLUBSWITH CLUBHOUSES UKATION/OWNERSHIP mATUS SERVICESPROVIDER COST(IFANY) REMARKS WATER ELECT CHAMBISHI AUTONOMOUS ZCCM ZCCM Difficult to quantify but TENNIS CHAMBISHI ZCCM cost arc mainly thmugh SEEAPPENDIXII AUTONOMOUS ZCCM scrvKes DIDV~~C~to the MINE CLUB CHAMBISHI AUTONOMOUS ZCCM ZCCM club. Cost of mainenanceontmiMiw rlso bornebyzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAthe CHAMBISHI ZCCMSPONSORED ZCCM ZCCM r- -zyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAl8 - CLUBSWITHOUTCLUBHOUSES NAMEOFCLUB LOCATIONIOWNERSHIP STATUS HALUFACILITY USED REMARKS DAKl3 CHAMBISHI ZCCMSPONSORED TENNIS CLUB I CHESS CHAMBISHI ZCCMSPONSORED MINE REC. CLUB BADMINGION CHAMBISHI ZCCMSPONSORED MINE REC. CLUB CROQUET CHAMBISHI ZCCMSPONSORED MINEWC.CLUB DRAUGHTS CHAMBISHI ZCCMSPONSORED MINE REC. CLUB NETBALL CHAMBISHI ZCCMSPONSORED GCNTSCHOOL BASKETBALL CHAMBISHI ZCCMSPONSORED MINE REC. CLUB TABLETENNIS CHAMBISHI ZCCMSPONSORED MINE REC. CLUB WLLEYBALL CHAMBISHI ZCCMSPONSORED GOVTSCHOOL HANDBALL CHAMBISHI ZCCMSPONSORED COVTSCHOOL JUDO CHAMBISHI ZCCMSPONSORED MINE REC. CLUB BOXING CHAMBISHI ZCCMSPONSORED MINE REC. CLUB XWTHSOCCER CHAMBISHI ZCCMSPONSORED STADIUM ATHLETICS CHAMBISHI ZCCMSPONSORED STADIUM KARATE CHAMBISHI ZCCMSPONSORED MINE REC. CLUB DRAMA CHAMBISHI ZCCMSPONSORED MINEREC. CLUB - 79 - mmBALLFmLDszyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA Q. TherezyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAare twoplaying fields m Chambishi township; one is a hotballpitch and the other is a rugby field. The fields and buildings are maintainedby ZCCM. One stadium is used by tie First Division Chambishi Football Club which is sponsonxlby ZCCM through the Community Services. ZCCM meets all costs of the team's kit, travel expenses, hotel accommodation, food and transport. ZCCM also bears winning bonuses,camp and trahing allwancesbrthe players including local cupg Details of expenses for the current year are given inthe table below: -80- ZAMBIA CONSOLIDATED COPPER MINES LIMITED NKANA DIVISION/CHAMBISHI MINE CHAMBISHI FOOTBALL CLUB EXPENDITURE ON LEAGUEKUPGAMES ALLOWANCES ALLOWANCES ALLOWANCES 11025000 4305000 27165072 NOTE 1. Winning allowances are paid to 16players and 3 officials i.e. Coach, Assistant Coach and firstAider. 2. Camping expenses are spenton fd,cleaning materials and toiletries for the team for one night. Three meals are prepared. 3. Match officialsare paid to 3 Referees and 1 Match Commissioner. 4. The home games are expected to attract gate takings. However, these have not be expectations since the team entered 1stdivision. An average of K25000 is collected per game. +f \ - 81 - WOMENCENTRESzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA There is one Women Centre situated mthe tintownship. The centre has one ZCCM employee who is assisted by one temporary worker. All equipment, reaching aids. and materialszyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAare funded by ZCCM. The centrezyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAcaters tbr an average of 60 women per year. They are trained in Basic and Advantxd Home Economics Course. Trainees are spouses of ZCCMemployeesandtheir dependants. OTHER SERVICES Public Health related services such as refuse collection and township cleaning are contracted out to registered contractors. !L* - 82 - PART IV-MUNICIRUzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBADWRASIRUCIVRALzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBASERVICJ3!3 ZCCMemplqeesmChambishi live mtwotownships, namely Chambishi Tmshipwith654houses of which 453 are low cost, 185 medium cost and 15high cost houses and Kabanga Tinvmhip which has a total of 297 low costs houses. All tietmmshipsarc withintiearea serviced by the local Council. Utilities such as water, sewerage, smtlighting, road rnaintenance are the responsibility of the Council who pmvide the services at a cost to ZCCM. ZCCM inturnprovide these services free of charge to the employees. Electricity to the houses is pmvided by ZESCO who bill ZCCM for the service. Duetoacontinued deteriorationof Council services andm order to maintain the standard of services due to its employees living in Chambishi Township, ZCCM has over the years taken an active role in helping the Council with some of the responsibilities: (i) Roads m the townshipzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBAare maintamed by an independent contractor who is, however, supervised by ZCCM on behalf of the Council. (ii) Sewerage services and water reticulation plants are maintained by ZCCM. The, water sowce is mainly from the mine and ZCCM owned pumping stations. (iii) Supervision of contractors responsible for refuse removal who are employed by the local Council. (iv) Smetlighting is maintained by ZCCM. All the above services are a responsibilityof the Council and there is an arrangement for ZCCM 'to recover any costs from the Council. A number of Chambishi Mine and Chambishi CobaWAcid Plant employees reside in Kalulushi and Kitwe. These emplcyees are entitled to the same quality of municipal and social services as applicable to other ZCCM employees in the location where they live. The range of municipal and housing services is shown in the table set out below* - 83 - ZAMBIACONSOLIDATED COPPER MINES LIMITED NKANA DIVISION/CHAMBISHIMINE MUNICIPAL INFRASTRUCIIJRE AND HOUSING SERVICES AS AT 17NOVEMBERzyxwvutsrqponmlkjihgfedcbaZYXWVUTSRQPONMLKJIHGFEDCBA1997 llDER& CO= SOCIAL SERVICES PIUMDER ELECTRICITY REFUSE sTRJ33 ROAD PUBLIC HOUSINQ COLLECTION LIGHTING MAINTENANCE HEALTH MAINTENANCE ZESCO CONTRACTED CITY CITY ZCCM ZCCM K0001YR BY COUNCIL COUNCIL COUNCIL 1380.000 K0001YR KOOO1YR KOOOIYR KOOO1YR K0001YR 434.OOO 123.000 239,ooO 213.000 1307,000 AGGR AGGREQATED \ L -84-