裪 膌 腀 膬 腃 腌 MINl:RAL PRODuCT:ON SHARI药 iG ACREEMEllT No. 198 - 2001 - Xr ThiS M:NERAL PRODuCT:ON SHAR:NG AGREEMENT is made and entered intO in Que20n C ty,Ph腡 ippines, this day of JUI{ 0 0 2004 by and be腒 veeni THE REPUBLIC OF THE pHlLtpplllEs, herein refered to as rhe GOVERNMENT, represented in this acl by the Secretary oI the Department of Environment and Natural Resources, wilh offices at the Department of Environmenf and Natural Resources Building, Visayas Avenue, Diliman, euezon City and BLUE RIDGE INERAL CORPORAT|ON, a corporation duly organized and exisling undar the laws of the Republic of tho philippines. herein r6ferred to as the CONTRACTOR, wilh office at 2255 Chino Roces Avenue, Makati Cily and represented in this act by its president, BENIGNO D. tGNACIO, as authorized by its Board of Directors (please refer to ANIIEX ,A) WTNETiSETI{ : WHEREAS, the 1987 Constitution of the Republic of the phitippines provides in Article Xll, Section 2 thereof that all lands of the public domain, waters, minerals, 腥 coal, petroleum and other natural resources are owned by the State and lhat 腁 their exploration, devolopment and ulilization shali be under the full controt and supervision of the State; WHEREAS, the Constitution turther provides that the State may direc y undertake such activities, or it may enter inlo a Co-production, Joint V'enlure or Mineral Production Sharing Agreement with Filipino citizens, or cooperatives, partnerships, corporations or associations at least sixty per centum of whose capitalization is owned by such citizens; WHEREAS, pursLranl to Repubtic Act No. 7942, otherwise known as .The Philippine Mining Act of 1995,'which took effect on 09 April 1gg5, the Secretary of the Deparlment of Environment and Natural Resources is authorized lo enter into lvlineral Production Sharing Agreements in furtheranco of the objectives of the Govemment and lhe Constitution to bolsler the national economy flrrough sustainable and systematic development and utilization of mineral lands: WHEREAS, lhe Govemment desires to avail itself of tho iinancial resources technical competence and skill, which the Contractor is capable of applying lo the mining operations of the project contemplated herein; ' ' ' '_ / =+"=- l) /.$f[ t' L1 \ 芽 WHEREAS, the Contractor desires to jorn and asstst the Government jn the ratlonal exploration and possjble development and utiltzation for initial Purposes o, certajn nickel and oth( associated mineral deposits commercial conrr""t ai"r l""'n"i.i"i#.".0j1""t existing in the WHEREAS, the Contractor has !9l?9lun"u, t,"r,norosy ;o .;,.XT:fi"'',#n*"""1,il;y;"#,:fi,1? promp y and effectivety carry out rhe oor".1r.. ,ilni"isi!#;i:," " NOW THEREFORE, for and in consrderaton of the foregoing premrses, flre mutual covenants, terms and cor herernafler set forth' it is hereby sriprrat.olno agi";"i"""'L,rlri, ""'o'trons SECTIoN: SCOPE ll ThiS Agreementis a MineraI Pr( pursuant tO the provisions of t f齏 臨 闡 鏜 证腶 郟 Fu腵 nislili腶 ]:|: irlif:: a::詼 鏻 1:ittt鑆 鑶 腹 膡2陑 n:p鑆 r趌 鍃 R软 腡 雬雔 证 趔 鹏 軲 菌 裻 鑹 i臨 醅: 雴 J:'tt腬 諭豰 腶:l趥 软 臨臨苚 腒 [wYl鉉 襟 鎼i釮 operations in the cOnt腵 ad荮 rea 13 The ContractOr sha腡 assume a腡 the expl腂 ation isk such that if nO 腵 腵 atty tte devdOped and p葟 ttc腧 nd be ."轖 IT銑 i:l腸 諭P: 釳 14 :荢 腍 腡19釞 l陸 :菅v:TI:腧 :i豻 itt lhelola vttueOfprOductOnandsa苉 ,g Operations cOntemplated herein sha腡 be accOunted fOr and divided beh膍 een the Government alld the contractor in accOrdance腁 菋 th sectiOn V腡 l hereof SECT:oN腡 DEFINIT:ON腵 nd terms, whether singular or 顕趔 誖:鑆 译苎菌装 鋺1賠1鍃 鉱 铬 誛l腷 蹈 菈荃 陰 2 菇 顧 腒 | 2膡 C Aa No 7942 oheAvse known as he腅 Ph芡 ne Y葜 雈 膜 in腶  譀 腁 醡 Natu腵 al Resources 2 45 Direc10腵 2.2a. Mlne _Dsyelgprned refers to worl( undertaken to prepare an ore body or a mineral deposit for mining, including the construclion of necesiarv infrastructure and related facililies. 2.25. Minerals mean afl naturally occurring inorganic substances in solid, liquid, gas or any intermediate state excluding energy materials such as coal, petroleum, natural gas, radioactive materials anJ geothermal energy. 2.26. Mineral produsls mean materials derived from mineral ores/rocks and prepared into markelable state by metallurgical processes, whicfi include beneficiation, cyanidation, leaching, smelting, calcination and other similar processes. 2.27. lylinina Area means that portion of the Contract Area identified by the Contractor as defined and delineated in a Survey plan duly approved by the Director/Regional Director concerned for purposes of developmeni and/or utilization and sites for support facilitjes. t 2.28. Mininq Operations means mining activities involving exploration, teasibitity study, environmental impact assessment, deyelopment, utilization, rnineral processing and mine rehabilitation. 2.29. Notice means notice in writing, lelex or telecopy (authenticated by answer back or confirmation received) addressed or senl as provided in Section 16.2 of this Agreemenl. 2.30. Ore means naturally oc,cuning substance or material from vrtich a ' mineral or element can be mined and/or processed for proiit. 2.31. Pollution means any alteralion of the physical, chemical and/or biological properties of any waler, air and/or land resources of the philippines, or any discharge lherelo of any liquid, gaseous or solid wastes or any production of unnecessary noise or any emission of objectionable odor, as will or is likely to create or reMer such water, air, and land resources harmful, detrimental or inlurious to public health, salely or welfare or which will adversely affect their utilization for domestic, commel.cial, industrial, agricullural, recreational or other legitimata purposes. 2.32. Secretarv means the Secretary of the Departmenl of Environment and Natural Resources. 2 33 State means the Republic of the t hilippines. 2.34. Work Proqram means a document \vhich presents tlte plan of major mining oporations and the coresponding expenditures of the Contractor in , its Contracl Area during a given period of time, including the plan and exponditures for development of holrl and neighboring communities and of local geoscience and mining technology, as submitted and approved in accordance with the implementing rul6ls and regulatiDns of the Act t\f{ 1; SECTION III TERM OF AGREEMENT 3..1. This Agreemenl shall have a term of twenty frve (2S) years from Erfective Dale, and may be renewed thereafter r"i i""r-"oi' exceeotng twenty five (25) years. The renewat ot ""lti*' ' changes in lhe terms and condjtions this ngreemeni, aJ'wltt as the by the parties. ln the thereol "nrif O" rpon,irtrrr event. the Government O""iA!" io "or""nt ' operations thereafrer by oiher Contraaoi,' th;J -;;;i ufio* *ining iJ trrougtr competitive.pubric biddrng. Afrer due publication ot notice, tte -contractor sna have the right lo equal ths highest bid upon reimbursement of all reasonable expenses of the highest bidder. sEcTloN tv CONTRAC'I'AREA 4.1. Size, Shape, €nd Location of Contract Area _ This Agreement covers a Cor.'tla9] Ifea of approximatety Three Thousand Seve-n HunJreO fifteen and 3409/10,000 hectares (3,7.15.3409 has.), situated in Mali and San lsidro. Davao Oriental and bounded by ine fottowing geographical coordinates (ptease refer to ANNEX ,b,, - t:SO.OoO -scile 'Loc€tion Map/Sketch Ptan): CORNER LAT:TUDE LONG:TUDE 艓 6膋40'0198'' 126膋11'lo 42" 艑 6膋42'1247腅 126膋441042膍 艒 6膋 42'4217'' 126膋 10'4469' 艓 6膋 42'3827腅 126膋10'4469' 艔 6膋 42'3827膍 426膋 09'5266腅 艕 6膋 43'0443腅 126腅 09'5266腅 艖 6膋 430443腅 126膋 10'1877腅 艗 6膋 43'3041' 126膋 10'1877腅 艘 6膋43.3041" 126膋 14'3440' 艐 腂 6膋 42'4019" 126膋 14'3928'' 艐腝 6膋 42'4019腅 126膋13'4936腅 艐艑 6膋 40'4053 426膋 43'4936'' 賂 6膋40'4053膍 126膋 13'4677腅 艖 6膋40'1700' 426膋13'3500' 腝艔 6膋40'0158' 126膋43'3649' 腧 6膋40'0053 126膋 13'3649" 艖 6膋40'0053'' 126膋 11.100o'' The Contlactor is not allowed lo undertake any mining activities within the portion of the Contract Area covered by any DENR project Areas, without the prior consent of the contractor(s)/concessionaire(s) concerned. Portions of the Contract Area within the proposed Ml. Hamiguitan Range Wldlife Sanctuary, including ils buffor zone, within elevations of 1,OOf 2'{r, ?d1-- I tfl u Lt 裉 ! 腝膌 meters and above. within the M,niciparity of san rsidro and in the Mineral production Sharino I .f conFrict wth MpsA xL ;4 ; ; iili i,"ffi "#i:HHJtr,t"X,J::jl"# in .i"; :fl XT:f ;: :ili::Ti,lrJ;t*"d rhrs Alreement, p.,oi"s ri""i''.J"lr,ii,"i, J, *" ln the event that said issues are resolv€d in favor of the Contractor. such temporarity exctuded areas shafl be inctuded t. u"J-t'#,.,0#,.i Contract Area, without need any rurprei asie;;.i; tr.,, hereor suoiect on,y to the "r 5,ij"lr., D/rector. e,se fhey rssuance of ri," ' -' "t shail be pemanently "i,p.opr.i"-O.1".'t1,,,r" excrsed ineretro^ Portion of the Contract Area that may be found and verified as old groMh andlor rnossy foresis shail be aulomatically excrsed from CJni.."t "",J SECTION V EXPLORATION PERIOD 5'1 Timetable for Exploration - The Contraclor shall commence Exploration activities not later than three (3) months after the Etfective D;6 G, , perrod ot two (2) years, renewable for like periods but not to exceed a lotal term.of six (6) years for nonmetallic minerals and eight (8) yeais for metallic minerals, subject to annual review and approval-Oy ttra dlrlctor in accordance with the implementing rules and reguiations ofihe Act. the one (1 )-year term- of the Temporary Exploration permit (ANNEX ,,C,,), denominated as TEp-Xt-006-2002, issued to Blue Ridge on i4ay 10,2OO2 shall be deducled iiom the Exploration period. 52 Renew€l of Exploration Period - ln case the Contractor opts for a renewal of its Exploration Period, it shall file prior to the expiiation thereof, a renewal applicatjon in the Regional Otfice concerned, accompanied by the mandatory requirements stipulaled in the implementing rules "and regulations of the Act. The Djrector may grant the re;ewal of the Exploration Period on condition that the bontractor has substantially conplied with the terms and condilions of the Agreement. ln.cases where further exploralion is warranted beyond the six (6)- or eight (8)-year period and on condition that the Contractor has substant;lly implemented the Exploration and Environmental Work programs as verified by the Bureau, the Director may further grant renewal of the Exploration Period: Provided, That the Contractor shall be required to set up a performance surety equivalent to the expenditure requirement of the Exploration and Environmental Work Programs 13 3. WorkWork ProoramsPrograms and Budgets - The Contractor shall stricfly comply with the approved Exploration and Environmental \A/ork programs together with/ ttr -a*(_ / (Tt , V-, Agre€ment. $.7. Survey ot the Conlract Area _ Tte C-ontraclor shall cause the survey of the perimerer of the contract Area/finat turrirg ;r;;;rrirg"h survey, comptete with requirements, fiteO in the Regio;ai "niilii"rtion ror- simutraneous wlh the submission ot tt. 6tfo-#on"rrn"o Survey returns shafl be submitted to o"ct"rai-iJn-oi'r,at"nin"i i"".iu,itv. approvat within one (1) year ftom trru a.g;rrio,L"ior""Jn.rrn.o io, with mandalory recerpt of tire OrOri oi'il.""v requiremenrs "orpr"r" ' ,the i, rr,"-irii#"'nii,llrrr,u" ,no regulalions of the Acl "t"tbo 5.8. Reporting a. Durjng lhe Exploration period, the Conlrachr shafl submit to the Director, through the Regional Direaor concemeJ, qru.t"rly.rO annual accomplishment reports under oath on lfi activities conducted in the Contract Area from the fffective 6ate of lhis l_oreem.911 The quarterty report shafl o. sroniiit'J nliiater- tr.n fifteen. (15) days at fl]e end of each Cafen.fai drarfel. ,nife tne annual accomplishment report shall be submineJ noi fater tiran thrrty (3O) days from the end of eacfr CafenOar iear Such information shall include detailed ,inancial expenJitureq raw anO processed geological, geochemical, geophysical and radiometric data plotred on a map at.a minimuri 1:56,000 s;aie,;pies of originals of assay results, duplicated samples. field data. copies of originals tiom drilling reports, maps, environmental *oii program implemenlalion and detailed expenditures strowing diicrebanctesl deviations with approved exptoralion ,no p-llns ano . budgets as well as all ottrer^information of "nuironni"niii the exploration aclivities. All information any kind cotteci"A Orring shall be subject lo the confidentiality su6mitteO io-tne Aureau clause ofthis Agreement. b. Final Reporl - The Contractor shall submit to the Director, lhrough the Regionat Director concorned, a tinat repo( unOei o"in upon tn" expiration of lhe Exploralion period which shall be in the form and substance compalable {o published prorossional reports of respectable internationat instrtulions and shall incorporate all the findings in the Contract Area rncluding locaton of samples, assays, chemical analysis, and assessment of mineral poieniials 'together with a geologic map of 1:SO,OOO scale at the minimum shovring the results of the exploration. Such report shall also include detailed expenditures incurred during the Exploration period. ln case oi diamond_ drilling, the Conlraclor shall, upon request of the Director/Regional Director, concerned submit to flrc negionat Otfice a quarter of the core samples, r,vhich shall be depo;ited in the Regional Ofllce Core Library for safekeeping and reference. CRelinquishment Report - Tle Contractor shall submit a separate relinquishment report with a detailed geologic reporl of ihe relinquished area accompanied by maps at-a scile of i:5O,OO0 ani results Or analyses and deta腡 ed expenditures,among Oth`腧 r _菉 荋 腙 r 陰 r 腍 腒 1 腒 _ 闐 | 腟 sEcTIoN vt DEVELOPMENT AND CONSTRUCTION PERIOD 6.'1 Timetable - 'Ihe Contractor shall co,nplete the development of the mine including the construction ot produciion facrlities wrihin tnrrty srx 1SO; months from the submission oF the Dectaration of Mining Eeasibitity. subject to such extension based on justifiable reasons as thebirector mjy . approve, upon recommandation of the Regional Director concerned. 6.2. Reporting a. Annual - The Contraclor sha submit, within sixty (60) days afrer December 31 of each year. to ihe Drrector, through the R;gional Director concerned, an annual report, which stites the major activities, achievements and delailed expenditures during the year covered, including maps, assays, rock ancl mineral anaiyses -and geologicat and environmental progress reports during the Development and Construction period. ` b. Final Report - \r'Uithin six (6) months from the completion of the development and construclion activities, the Contraclor shall submat a ,inal report to the Director, lhrough the Regional Director concerned. Such report shall inlegrale all informalion in maps of appropriate scale and quality, as well as in monographs or reports in accordance with intemational standards. . sEcTtoN l/I OPERATING PERIOD 7 .1. Timetable , The Contractor shall submit, within thirly (30) days before complelion of mine development and conslruction of produ;tion facilities, 腶 ' to the Direc.tor, through the Regional Director concemed, a Three_year Commercial Operation Work program. The Contractor shall commence commercjal utilization immodiately upon approval of the aforesaid Work Program. Failure of the Contractor to commence Commsrcial production within the period shall be considered a substantial breach of the Agreement. 7.2. Commercial Operation Work program and Budget _ Dunng the Operating Period, the Contractor shali suhmit to the Direior, ttrroujh tne Aegiona-t Director con,:erned, Worl( programs and Budggts coveing a perroO ot three (3) years each, which shall be submitteJ not laler thlan thirty (30) days before the expiration of the period covered by the frevious Work Program ' The Contractor shall conduct Mining Opcrations Bnd other aclivities for the d-uration of the Operating pe.iod in eccordance with the auty approveq Work Programs and corresponding Budgets. _EF_ ' ' pt{f 芒膌 腸苠 腝 艬 腒 7.3. Expansion and Modification Facitities _ The Cont?ctor may expansions, modifrcations. _of make imprsyem€,61r, anrt ,eplacemenis ot ine Facilrties and may add new facitities as tne -i"iir"","i,",#,j mining necessary for the operations provided, ir,.1- *"",0", embodied in an appropriate wo* e.ogr;m "rcil-pran"J ue app;.jt, "nrrr inJ,61."""o. 7 4. Reporting a. euarterly Reporls _ Beginning wilh the first Calendar euart€r foltowing the commencemeni of tne Opeiarinj FlrioO, tn" Contractor shal submit, within thirty 1SO1O.y! ano il" .iO ot each Catendar euarler, ro the Direcror; ihr,iugh iil'A"sLi"i oir"ao, :-onTrL"d, a euarterly Report stating thJtonnage oi production in rerms ot ores, concentratos, and their corresponding grades and other types of pmducts; vatue, destination of Jafei oi Jxports to whom sold. terms of sales and expenditures. "no b. Annual Reports - During the Operaling period, the Contractor shall .r^rpJ1it^y-,j!l! ",.lry (60) dar/s fiom lhjend or b""n Carenoa, yrar, ro tne Urrector, ihrough lhe Regional Director concerned, an Annual Roport indicating in sufficient detail: b.1 The total tonnage of ore resoryes, whether proven, probablg, or irfened, the total tonnage of ores, kind by kind. broken down between tonnage mined, tonnages transported from the minesite and their corresponding iestination, tonnages stockpiled in the mine and elsewhere in the phitippinls, tonnages sold or crlmmitted for export (whether iilualty shipped from the philippines or not), tonnages actualli shipped from the phitippines (with fu Oejaiis as to purchaser, destination and lel.ms of sale), and ii known lo the Contractor, tonnages refined, processad or manufactured in the philippines with full specifications as to the intermediate products, by-products or hnal producls and of lhe terms al which thcy were drsposed, b.2. Work accomplished and work in progress at the end o, the year in question with respect to ai the insta ations and facilities related .to lhe utilization program, tncluding the investment actually made or commi[ed; ind b.3. profile of work force, jncluding management and staff, slating particularly their nationatilies, and for Filipinos, their place of origin (,.e., barangay, town. province, region;. The Contractor shall also comply with other reporiing requiremenls provided for in the imptementing rutes and regutations of th; Ad] ^;f - --=:l- tll 膌 艫 腁 荧 膌 SECTIoN VI腡 FiSCAL RECIME 赼 鍤   鳡 詭 顨 鉀 resources unde腵 1ls nat Onai sO 82 RegistratiOn Fees腜 Within l膡 eel 荣 腝 酕  麽 邧軓 :鑸 襺 闣: 轒 苦l迭 葛 限 轒  1证 鞴 誛 酎 譲 84 Share OFthe Government腜 The cPVernment share sha腡 be the excise tax t鎇 膒 :諌 醌 鑶1釳 陑 1苔I陠 豱 苓腸 we腡 as Olher taxes, du:ies and rees 腵 酖 鹏rf鍅 鍤鞓 鎈 諭 車 臷 鉉 釮 loquirements presc"bed urider ex苉 sT軓 躿 迃腴 tTh鋻 鎾:趆 :鎬 諭 郟 豞 隦 酧 鎥 轢 镀 :酧 轭貂 iF豒 scale and iong-ternl contracts shall bo procured. "fhe Bureau shall be furnished a copy of the said Sales Agreement subject to confidentiality belween the Bureau and the Contraclor. 86 Associated Minerals - lf minerals other than nickel are discovered ln commsrcial quantities in the Contract Area, the valuo thereof shalt be added to the value of the prrncrpal rnineral in mmputing the Government share SECT,ON腬 X WORK PROCRAMS 91 Submission tO Gove腵 腜 nment sEcTroN x ENVIRONMEhII'AL PROTECTION AND MINE SAFETY ANO HEALTH 10.1. The Contractor shall manage its Mining Operations in a techni€lly, financially, socially, culturally and environmonialty responsible manner lo achisve the sustainable devolopment ob.iectives and responsibilities as provided for under the implementing rules and regulations of the Act. '10.2. The Contractor shallensure that the standards of environmental protection are met in the course of the Mining Operations. To the extent possible, confol of pollution and lha trausformation of the mined-out areas or materials into economically and socially productive forms must be done simultaneously y/ith mining. 10.3. The Contractor shall submit an Enyironmental Work program during the Exploration Period as prescribed in the implementing ruletand regulaiions of the Act. 10.4. An Environmental Compliance Certificate (ECC) shall be seored first by the Contractff prior to the conduct of any developntent works, construction of production faciliti€s and/or mine prcduction activities in the Contract Area. 10.5. The Contractor shalt submit wilhin lhirty (30) catendar days after the issuance and receipt of the ECC, an Enviionmental protection and Enhancoment Program (EpEp) using MGB Form No. 16-2 covering all areas lo be affected by development, utilization and processing aclivities under this Agresmenl The Contraclor shall albcate toi its inttial snvironment-related capital exponditures approximately ten percent (1Oolo) of the total project cost or in such amounl depending on tha environmental/geological condition, nature and scale of operitions and t6chnology to be employ6d in the Contract Area. 10 6. The Contraclor shall submit, within thirty (30) days prior to the beginning of every calendar year, an Annuai Environmental protection and Enhanc€ment Program (AEpEp), using MGB Form 16_3, which sna Oe based on the approved EpEp, The AEpEp shall be impiemented during the y6ar for which it was submitted. To imptemeni lts eEpep, me Contractor shall allocate annually three to five percent 1CZ"_Sv"1 of ifs direc.t.mining and milling costs depending on lhe environmental/geologic condition, naturo and sc€le of operations ind technology empioyed in tho Contract Area. 10.7. The Conlractor shall establish a Mrne Rehabilrtation Fund (MRF) based on the. financial requiremenls of the approved fpfp ad-a rlasonaote snvironmental deposit to ensure satisfactory compliance wlth the commitments/strategies o, tho EpEp/AEpEp ana availlOititv ot funOs for th6 performance of the EpEp/AEFEp Ouring the +."1f[ dr#"r pi,".u. Ii:,.111 shait be deposited as rrust Fund-in g6r"rnrlni'dlpo"torv DanK and sha be used for physical and " affected by mining activities andior social iehabilitation of areai researctr on in" .fr|iliulnn,or uno preventivc aspects of rshabititatron. - -3p_ " - . S iltft 0 14 li tl ! /腔 10.8. The Contractof shall sel up rnitigating measurea such as mine waste and mill tailings disposal syslem, min6 rehabilitation or plan, wat€r quality moniloring, etc. to minimize land degradation, air and water pollution, acid rock drainage and changes in hydrogeology. 10.9. The Contraclor slrall set up an Environmontal and Safety OfJice at its minesite mannod by gualified personnel io plan impl€msnt and monitor its approved EPEP. 10.10. The Contractor shall be responsible in the monitoring of environmental, safety and health conditions in ths Conbact Area and shall strictly comply with all the rules and regulations embodied under DAO No. 2000-98, otherwise known as the "Mine Safety and Health Slandards." 1A11.The Conlractor sha,l be responsible for the submission of a final mine rehabilitatjon anci/or decommissioning pians, including its fnancial requirements and incorporating the detaals and particulars set forlh in the implementing rules and regulations of the Ac1. $ECT|ON Xl RIGITITS AND OBLIGATIONS OF THE PARTIES 'l 1.1. Obligations of the Cofltractor: a. To exclusivoly conduct sustainable Mining Operations within lhe Contract Area in accordance with the provisions ol the Aci and its implsm6nting rules and regulalions; b. To construcl and operate any facilities speciflsd under the Minerql Agresm€nt or approved Work Program; c. To determine the exploratjon, mining and treatmenl process to bs utilized in the Mining Opsrations; d. To extracl, remove, use and dispose of any lailings as authorizgd by an approved Worl( Progrcm; e. To secure all permits necossary or desirable for tha purpose of Mining Operations; f. To keep accurate technical records about the Mining Operations, as well as financial and marketing accounts, and make them availablo to Government repressntatives autho zed by the Director for the purpose of assessing tha performance and compliance of ths Conlractor with ths tems of this Agrsement. Authorized representalives of other Govemment Agencies may also have access to such accounts in ac@rdance wilh existing laws, rules and regulations; 膌 ,4( 腜 腪 16 腅 腞 苉 菐 腪 l'a ft,mish the Burezu ell lhe dala and i.formalion galheed frcm the Conlracl Area and thal all the books of accounts and records shall be open for inspection, To allow access lo Govemment during roasonable hours in inspecting the Contrad Area and examining pertinent records for purposes of monitoring compliance with the terms of this Agreement; To hold the Govemmenl free and harmles-s from all claims and accounls of all kinds, as well as demands and actions arising out of the accidenls or iniuries to persons or properties caused by Mining Operations of the Contractor and indemnify the Govemment forany oxpsnses or costs incufed by the Govemment by rsason of any such claims, accounts, demands or aclions, ln the development of the community: j.1. To recognize and respec{ the rights, customs and traditions of indigenous cultural crmmunities ovar their anceslral lands and to alloc€te royalty payment of not less than ona percent ('l%) of the valuo of lhe gross output of rninsrals sold; ).2. To coordinals with prop8r authorities in the development of the mining community and for those living in the host and neighboring communities through social infrastructure, livelihood programs, education, water, eleclricity and medical services. \ /hers traditional self-sustaining income and th€ crnrmunity activities are identifisd to be present, the Conlractor shall assist in lhe preservation and/or enhancement of such activities; J.3. To allot annually a minimum of ons percent (1%) of the direct mining and milling costs necessary to implemenl the activities mdertaken in the development of the host and neighboring communities. Exp€nsss for community development may be charged against lhe royalty paymenl of al least ona perc€nl (1%) of the gross output intended for the concemed indlgenous cullural communily; j.rl. To give pretoranco lo Filipino citizans who have established domicile in the noighboring communities, in the hiring of personnel for its nlining operations. lf necessary skills and expertise are currently not available, lhe Conlractor must immediately prepare and undortake a training and recruitment program at its expense, and j.5. To incorporate in the Mining Feasibitity Study the ptanned u芢 苭躧 )莵 "賄 趂 铈 "mm雴 苇 腶 誝 菅莌 腲芽 腁 16 lC_ 膌 膌 ln the development of Minntg Technology and Geoscionoes: k.1. ln the course of its o@rations, to produce oeolooicat geophysicat, geochemical and olher types of iraps-anj reports that are appropriatB in scala and in format and substance which are consistent with the intemationallt accepted standards and practices. Such rnaps shall be made available to the scientific communily in the most convenient and cost effective forms, subject io the condition that the Contractor may delay release of-said information f;r a reasonable period of time, which shall not exceed three (3) years; k.2. To systematic€lly keep the data generated from the Contracv Mining Area such as corei, assavs and other rolated information, includrng economic and iinancial data and make them acce$ible to students, research€rs and other persons rgsponsible for dsveloping mining, geoscience and processing lechnology subject to the conOiti6n that ttre Contraclor may delay release of data to the sci€nce and technology community vyithin a reasonable period of time which shall not exce€d lhree (3) years, k.3. To transfer to ths Government or local mining cornpany the appropdate tochnology it may adapt in lh! oxploration, dovelopment and commercial utilization of the minerals in the Contract Area; k.4. To allocate research and developmant budget for th6 advancament of mining technology and geo;ciencas ir) coordination with the Bureau, research institutions, academe, elc.; and k.5. To replicat€ dala. maps and reports cited in (k.j) and lk.2) and tumish the Bureau for archiving anO iystematii safekeeping which sha be made availtble to thri science and techno,ogy community for conducting research and undertaking other activities which coriributa to the development of mining, geoscienco and processint techno,ogy and the conesponding nalional pool oi manpower talsnts: provided, however, that the reiease of data, maps and ths like shall be similarly con"fruin"O ln accordance with (k..1) and (k2) above; Io incorporate in the Mir.ring Feasibility Study the olanned :Y.e1d,rtyr?.s. n:cessary to imptement a rho ptani and piograms set torth rn this Agreement; and To pay all other taxes and and regulations. fees mandated by sxisting laws, rulos --e$- 腙 醜 N, 17 腁 1 1.2. Rights of the Contractorl a. To conduct Mining Operations within the confines of its ContracuMining Area in accordance with the terms and conditions hereof and without interfering with the rjghts of other Contractors/LesseeyOperators/ permilees/permit Holders; b. Possession of the Contract Ar6a, with full right of ingress and egress and the right to occupy the same, subject to surface and easement rights; c. To use and have access lo all declassified geological, geophysical, drilling, production and other data relevant to the mining operalions; d. To sell, assign, transfer, convey or otherwise dispose of all its rights, interests and obligalions under the Agreement subject to the approval of the Governmenl; e. To employ or bring into the philippines foreign technical and specialized personnel, including the immediate members of their families as may be required in the operations of the Contracto[, subject to applicable lalvs and regulationsr provided, That rf the employment connection of such foreign persons with the Contractor ceases, the applicable laws and regulations on immigration shall apply to lhem. Every time foreign technologies are utilized and where alien executives are employed, an effective program of training understudies shall be underlaken. The alien employment shall be limiled to technologies requiring highly specialized tr;ining and experience subiect to the required appioval under existing laws, rules and regulationsi t. To enjoy easement rights and use of timber, water and other natural resources in the Contract Area subject to pertinent laws, rules and regulations and lhe rights of third p;rtiesi g. Of repatriation of capital and remittance of profits, dividends and interest on Ioans, subject to existing laws and Bangko Sentral ng Ptlipinas rulss and regulations; and h. To import when necessary all equlprnent, spare parts and raw rnaterials required in the opBrations in accoidance with existing lavys and regulations. 1 L3. Obligations of the Government: a. To ensute that the Conlractor has the Govemmenl,s lull cooperation in the exercise of the rights granted to it under this Agreement; b. To use its best efforts,to ensure the timely issuance of necessary permits and sjmilar authorizing d,:cuments for use of the surface of fl.te Conlract Area; uno rd =_f..- qfr 18 ' l. \' ' f^- I l/' ||| To cooperate with the Contractor in its efforts to obtain financing corrtemplated hereiD from banks or other financial institrdions: Provided, That such ,inancing anangements will in no event [educe the Contraclols obligation on Go'/ernment rights hereunder. sEcTtoN x ASSETS AND EQUIPMENT 12.1. Ihe Contractor shall acquire ,or the Mining Operations only such assets thal are reasonably estimated to be required in carrying out such Mining Operations. 12.2. All materials, equipment, plant and other installations of a movable nature erected or piaced on the Contract Araa by the Contractor shall remain the property of the Contraclor. Tlte Contractor shall have the right to remove and re-export such nlaterials and equipment, plant and oth6r installations from the Fhilippines, subject to existing rules and regulations. ln case of 腒 腁 cessation of Mining Op€rations on public lands occasioned by its voluntary abandonment or withdrawal, the Contractor shall have a period of one (1) year from the timo of cessation within which to remove its improvements; olherwise, all social infrastructures and facilities shall be turned over or donaled tax free lo the proper governrnent authorities, national or local to ensure that said intrastructures and facilities are continuously maintained and utilized by the host and neighboring mmmunities. sEcTtoN xIl EMPLOYMENT AND TRAINING OF PHILIPPINE PERSONNEL '13.1. The Contractor agrees to employ, to the extent possible, qualified Filipino personnel in all types of mining operations for which they are qualiriad; 腒 _ and after Commercial Production comrnen@s shall, in consullation ancl with consent of the Govemment, prepare and unde(ake an extensive training programme suitablo to Filipjno nationals in all levels of employment. The obieclivo of said programme shall be to reach within the timetable set forth below the following largets of .Filipinization;" Unskined sk腡 led C eHcaI P腵 Ofesslonal Management (%) (%) (%) (%) (%) Yeat 艖腂 1 100 100 100 70 Year 3 膇 100 100 400 80 Year 5 艘腂 100 400 100 90 7 艘艔 100 1oo '/ear 100 100 Year 10 艘艔 100 1oo 100 100 Year 15 艘 艔 100 1oo 100 100  鉀 膍 19 '13.2. Cost and expenses of training such Filipina personnel and the Contractor's oy/n ernployees shall be included in the Operating Expenses. '!3.3. The Contractor shall not discriminate on the basis of gender and shall respect the right ot women workers lo participate in policy and decision- making processes affecting their rights and benefits. SECTION XIV ARBITRA'I'ION '14.1. The Govemment and the Contractor shall consult with each other in dood faith and shall exhaust all available remedies to settle any and all disputes or disagreements arising out of or relating to the validily, interprelalions, enforceability, or performance of this Agreement before resorting to arbitration as provided for in Section 14.2. below. '14.2. Any disagreernent or disput€ which cannol be settled amicably wifhin a period of one (1) year frorn the tirne the issue is raised by a Party shall be setlled by a tribunal of three (3) arbitralors. This tribunal shall be constituted as follows: one to be appointBd by the Contractor and the other lo be appointed by lhe Secretary. The first two appointed arbitrators shall consider names of qualilied persons until agreement on a mutually acceptable Chairman of the tribunal is selecled. Such arbitration shall be initiated and conducted pursuant lo Republic Act No. 876, olherwise known as the 'Arbitration Act." ln any event, the arbitration shall be conducled applying the substantive laws of the Republic of the Philippines. 14.3. Each party shall pay filty percent (50%) of the fees and oxpenses of-the Arbitrators and the costs of arbitration. Each party shall pay ils own costs and attomey's fee. k"腌 SECTION XV SUSPENSION OR TERMINAT|ON OF CONTRACT, TAX INCENTIVETi AND CREDITS '15.1. This Agreement may be suspended for failure of lhe Contractor: (a) to comply with any provision or requirement of the Act ancuor its implementing rules and regulations; (b) to pay taxes, fees ancuor other charges demandable and duo the Governrnent. 15.2. This Agreement tsrminates or may be terminated for lhe following causes: (a) expiration of ils term, whsther original or renewal; (b) withdrawal from the Agreement by tho Contractor; (c) violation by the Contractor of the Agreement's terms and conditions; (d) failure to pay taxes, fees/or charges or financial obligations for two (2) consecutive years; (e) false statement or omission of facts by the Contractor; and (f) any other cairs? ,"r-- _6tr_, h\t( 20 1芢 tl 腒 苡 荨 or reason provided under the Act and its irnplementing rules and regulations, or any other relevant laws and regulations. 15.3. All statements made in this Agreement shall be considered as conditions and essential parts hereof, and any falsehood in said statements or omission of facts which may alter, change or affect substantia y the fact set forth in said statements shall be a ground for its revocation and terminalion. 15.4. The Contractor may, by giving due notice at any tirne during the term of this Agreement, apply tor its cancellation due to causes which, in the opinion ot the Contractor, render continued mining operation no longer feasible or viable_ ln this case, the Secretary shall decide on the application within thirty (30) days from notice: provided, That the Contractor has met all ths rinancial, fiscal and legal obligations. 15.5. No delay or omissions or coufse of dealing by ths Government shall impair any of its righls under this Agreement, except in th6 case of a \ryritten waiver. The Government's right to seek recourse and relief by all other means shall not be construed as a waiveT ot any succeeding or other default unless the contrary intention is reduced in writing and signed by the party authorized to exercise the waiver. 15.6. ln case of lermination, the Conlractor shall pay all the fees and otlter liabilities due up to the end of the year in which the termination becomes effectjve. The Contractor shall immediately carry out the restoration of the Contract Area in accordance with good mining industry practice. 15.7 The }vithdrawal by the Conlractor from the Mineral Agreement shall not release it from any and all financial, environmenla[ legal and fiscal obligalions under this Agreement. 15.8. Ths following acts or omission, inter alia shall constitute breach of contract, upon whjch the Governmant may exercise iis right to lerminate the Agreement: a. Failure of the Contraclor without valid roaaon to commence Commercial production wilhin the period prescribed, and/or b. Failure of the Contractor to conduct mining operations and other actjvities in ac@rdance with lhe approved iA/ork erogrumslnJlo, any modification thereof as approved by the Director. 15 S l!9.Goyer1m.ent may suspend and cancel ta( incentives and cr€dits if the uonuactor tarrs to abide by the terms and conditions or said rncentives:nd credtts -E+- qt{ 菀 艫 21 腒 SECTION XVI OTHER PROVISIONS 16.'1. Any terms and conditions resulting, from repeal ff amendment of existing ,aws or regutation or trorn itre enaJfi-eit any administrative order shatr be consrdeied p",i ir ]'i""*,"r"grrrtio, o, " Ji'ini",nn,JJ,,i,*, 16.2. Notice All notices, demands an other communlcations required or permitted hereunder shalt be mado in writrns, t"d;;; iil;;;;l,#ai o, o"ur"o to have been duty giyen notice, in tt. 6i f,t.l".ol, rer"copy, answered back or confirmation received, "." jy if oerno * iio"r,"!-# nana, upon !?fi'i! ilj"*.::Strter denosici'"d;"ff, J,',air posrise lf to the Government: THE SECRETARY Department of Environment and Natural Resources DENR Buitding, Visayas Avenue Utltman, euezon City lf to the Contractor: THE PRESIDENT Biue Ridgo Mineral Corporation Z2SS Chino Ro@s Avenue Makati Cily Either parly may substilute or .handa .,,^h .. or change such address ^,r_^-- - the other party. on notice thereof to 16.3. Goveming Law This Agreemont and th€ re]1lol betwsen the parties hereto governed by and construod ir shalt be lne prrtlippries -rH;;i,]:i^:3t9"'ce with the lavi's of lhe Repubric or wrtn tne'irov-rsions;f"i#';5'i.T1?,v agrees and oblrges itself l; complv otnet rerJ,anilai"J ;;i' ;:fi;:,,i;i'p'"mentins rules and resulations and '16.4. Suspension of Obligation " fJ'"lxH1?':.J"fl,,:l ll^".:aot ulr.pinv jn the perrormance or attribut;bte to ;o;'ii^11:uno"' shall be excused to th€ alitont tt'u ,r.p"n.ii, ;;;#i':l"'i "" g"rined in the Act: Provioed, Tnat "n"riol"*b,;"i i. ,'J;:?Jff1?'fff',,=t;e 1o Force Maieurc causes b lf Mining Operations are delay€d, curtailed or ptevented .?5- by such =g=- rfl'r 22 Force Majeure causes, lhon the lime for enjoying the nghts and carryans out the obltgalions rnereUv attect6O, ii".i'"r, or tni* Agreemenl and a[. rights and shal be extended tor a period . --..-" equat "origrd;-h;r"dJr to tne pen6J irrrfr.j c. The party, whose alllll-g q-erf-orm irs obtigarions is aLcteo such.Force Majaure causes, snatr promprty j-tvl- ijojii t tn" by in writing of any such.detay or raidr. ot-p,irrliriunil]t ott ", duration rhereot and its anlicipateo eneJunJ " "rp.","o remedy such deray. except.ihar p;;;.;;;.under to h"; "t-"iiiJ",,t" "nort" obtigalion ro serue a.tabo; "" any o, aispure: FrovioJi,,ri"i'i#.r.p"n",on i,l$';XX,,,;; ,n" conrracror strarr tJ",io;Iit't,i,roI jpp,o,"r ov 16.5. Amendments This Agreement shall not be.g.llltfedr or modifi€d in ., any respect except by mutual conssnt in writing .?mended ", of the trerein parties.,.'* r lN WTNESS WHEREOF. lhe parties herelo have executod Ihrs Agreemenl, of the day and year firsl above written as THE REPUBLIC OF THE PHILIPPINES BY; 顥 Resources MLCOIPoM腅 膋 諭葛 N 閞 2鉱 1襣菌 BY: 銰腁 SIGNED IN THE PRESENCE OF: lsignatrr ore-i iirEGil 荑 23 ACKNOVVLEDGMENT nelss 8:铕 詋 thePh"p膜 ~荥 u '[莵 X,鳝 h荮 韕y莋 腡 迺膊 釮TlYttrd荣 臨 豒豒芯豰:F腍臱腵荍車1281膡 芵 6芶 [F27腍f fttYN,,荜蝖 草 腁 苧 腘 荂1貥 4 Li ,Suel On观 ,h htt Capaow as 'b鷣 'Its苔 芰 6鏫 Of inl辤 镩 蹳 譫腷 转部饈 鎇 1趌 In鑇 "lmu苨 边诵轩膡苢R談鞝,腅 腜 花 enncab h鳁 t,g膜281a鍤莆 膌 ?腺苔 陼 荔:諧 i 遄 n鿹 il膌 鑇F~ittII :ly腌 T醠 鞂 , in his capadty as Presden Of B苉 eR-66-腸 郡1腶 '譕 b me knOwn b be he same pttOns w药 葝 :觃 镹 雊 11腶 膡芾 lj鑇 鯜  苠 膜:0,芡膌腁 ^^`` ^_` `_ _ ^腌 ^^荮 貂讗证1酪11醌诳 膌 腒