Nuclear
      Regulatory

    Consulting
      and Strategic Advisory 

    Agreement

    


    by
      and
      between

    


    The
      Federal Authority for 

    Nuclear
      Regulation

    


    and

    


    THORIUM
      POWER, LTD.

    


    August
      1, 2008

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    

       
        

       

    

    TABLE
      OF CONTENTS

     

    
      
        	
                1

              	
                
                  CONSULTING
                    AND STRATEGIC ADVISORY SERVICES

                

              	
                7

              
	 	 	 
	
                1.1

              	
                Thorium
                  Power Services

              	
                7

              
	 	 	 
	
                1.2

              	
                Thorium
                  Power Resources

              	
                7

              
	 	 	 
	
                1.3

              	
                FANR
                  Resources and Support

              	
                8

              
	 	 	 
	
                1.4

              	
                Compensation

              	
                8

              
	 	 	 
	
                1.5

              	
                Quarterly
                  Reviews

              	
                8

              
	 	 	 
	
                2

              	
                
                  STAFF
                    MANAGEMENT

                

              	
                9

              
	 	 	 
	
                2.1

              	
                Objective

              	
                9

              
	 	 	 
	
                2.2

              	
                Recruiting
                  of personnel

              	
                9

              
	 	 	 
	
                2.3

              	
                Transfer
                  of Personnel

              	
                9

              
	 	 	 
	
                2.4

              	
                Non-Solicitation

              	
                10

              
	 	 	 
	
                3

              	
                
                  TERM
                    AND TERMINATION

                

              	
                10

              
	 	 	 
	
                3.1

              	
                Term

              	
                10

              
	 	 	 
	
                3.2

              	
                Termination
                  for Default

              	
                10

              
	 	 	 
	
                3.3

              	
                Termination
                  for Convenience

              	
                11

              
	 	 	 
	
                4

              	
                
                  CONFIDENTIALITY

                

              	
                11

              
	 	 	 
	
                4.1

              	
                Definition
                  of Confidential Information

              	
                11

              
	 	 	 
	
                4.2

              	
                Obligation
                  of Confidentiality and Non-Use

              	
                11

              
	 	 	 
	
                4.3

              	
                Obligation
                  to Inform

              	
                12

              
	 	 	 
	
                4.4

              	
                Exceptions
                  to Confidential Information

              	
                12

              
	 	 	 
	
                4.5

              	
                Disclosure
                  to Governmental Authorities

              	
                12

              
	 	 	 
	
                4.6

              	
                Return
                  or Destruction of Confidential Information

              	
                12

              


      

       

      
        
          
          

        

        
          2

          
            

          

        

        
          
          

        

      

      

         
          

      

       

      
        	
                5

              	
                
                  INTELLECTUAL
                    PROPERTY

                

              	
                13

              
	 	 	 
	
                5.1

              	
                Ownership
                  of Intellectual Property

              	
                13

              
	 	 	 
	
                5.2

              	
                Further
                  Assurances

              	
                13

              
	 	 	 
	
                6

              	
                
                  LIMITED
                    WARRANTY AND DISCLAIMER

                

              	
                13

              
	 	 	 
	
                7

              	
                
                  DISCLAIMERS
                    AND LIMITATIONS OF LIABILITY

                

              	
                14

              
	 	 	 
	
                7.1

              	
                Disclaimer
                  of Consequential Damages

              	
                14

              
	 	 	 
	
                7.2

              	
                Liability
                  Cap

              	
                14

              
	 	 	 
	
                7.3

              	
                Applicability

              	
                14

              
	 	 	 
	
                7.4

              	
                Acknowledgement

              	
                14

              
	 	 	 
	
                8

              	
                
                  INDEMNIFICATION

                

              	
                15

              
	 	 	 
	
                9

              	
                
                  INDEPENDENT
                    CONTRACTOR STATUS

                

              	
                15

              
	 	 	 
	
                10

              	
                
                  COMPLIANCE
                    WITH LAWS

                

              	
                16

              
	 	 	 
	
                11

              	
                
                  NOTICES

                

              	
                16

              
	 	 	 
	
                12

              	
                
                  CHOICE
                    OF LAW AND DISPUTE RESOLUTION

                

              	
                17

              
	 	 	 
	
                12.1

              	
                Governing
                  Law.

              	
                17

              
	 	 	 
	
                12.2

              	
                Mediation
                  of Disputes.

              	
                17

              
	 	 	 
	
                12.3

              	
                Resolution
                  of Disputes.

              	
                17

              
	 	 	 
	
                12.4

              	
                Decision.

              	
                18

              
	 	 	 
	
                12.5

              	
                Discovery.

              	
                18

              
	 	 	 
	
                12.6

              	
                Submission
                  to Jurisdiction.

              	
                18

              
	 	 	 
	
                12.7

              	
                Fees;
                  Expenses.

              	
                18

              
	 	 	 
	
                12.8

              	
                Amendment
                  to LCIA Rules

              	
                18

              
	 	 	 
	
                12.9

              	
                Agents
                  for Service of Process

              	
                19

              


      

       

      
        
          
          

        

        
          3

          
            

          

        

        
          
          

        

      

      

         
          

      

       

      
        	
                13

              	
                
                  NATURE
                    OF AGREEMENT

                

              	
                19

              
	 	 	 
	
                14

              	
                
                  FORCE
                    MAJEURE

                

              	
                19

              
	 	 	 
	
                15

              	
                
                  INSURANCE

                

              	
                20

              
	 	 	 
	
                16

              	
                
                  LICENSES
                    AND TAXES

                

              	
                20

              
	 	 	 
	
                17

              	
                
                  QUALITY
                    ASSURANCE PROCEDURES

                

              	
                20

              
	 	 	 
	
                17.1

              	
                Subcontractor
                  Quality Assurance Procedures

              	
                21

              
	 	 	 
	
                17.2

              	
                Non-conformances

              	
                21

              
	 	 	 
	
                17.3

              	
                Adequacy
                  of Methods and Equipment

              	
                21

              
	 	 	 
	
                18

              	
                
                  LABOR
                    AND IMMIGRATION LAWS

                

              	
                21

              
	 	 	 
	
                19

              	
                
                  TRAINING
                    OF EMPLOYEES

                

              	
                21

              
	 	 	 
	
                20

              	
                
                  SAFETY
                    CULTURE

                

              	
                22

              
	 	 	 
	
                21

              	
                
                  CODE
                    OF ETHICS

                

              	
                22

              
	 	 	 
	
                22

              	
                
                  SAFEGUARDS
                    INFORMATION

                

              	
                23

              
	 	 	 
	
                23

              	
                
                  NUCLEAR
                    LIABILITY PROTECTION

                

              	
                23

              
	 	 	 
	
                24

              	
                
                  MISCELLANEOUS

                

              	
                23

              
	 	 	 
	
                24.1

              	
                Assignment

              	
                23

              
	 	 	 
	
                24.2

              	
                No
                  Third Party Beneficiaries

              	
                24

              
	 	 	 
	
                24.3

              	
                Survival

              	
                24

              
	 	 	 
	
                24.4

              	
                Headings

              	
                24

              
	 	 	 
	
                24.5

              	
                Amendments
                  or Modifications

              	
                24

              
	 	 	 
	
                24.6

              	
                Reproduction
                  of Documents

              	
                24

              
	 	 	 
	
                24.7

              	
                Severability

              	
                24

              


      

       

      
        
          
          

        

        
          4

          
            

          

        

        
          
          

        

      

      

         
          

      

       

      
        	
                24.8

              	
                Contract
                  Construction

              	
                25

              
	 	 	 
	
                24.9

              	
                Entire
                  Agreement

              	
                25

              
	 	 	 
	
                24.10

              	
                Counterparts

              	
                25

              
	
                ATTACHMENT
                  A - STATEMENT OF WORK

              	
                27

              
	
                ATTACHMENT
                  B - THORIUM POWER RESOURCES

              	
                28

              
	
                ATTACHMENT
                  C – FANR SUPPORT

              	
                29

              
	
                ATTACHMENT
                  D – COMPENSATION

              	
                30

              


      

       

    

    
      
        
        

      

      
        5

        
          

        

      

      
        
        

      

    

    

       
        

       

    

    CONSULTING
      AND STRATEGIC ADVISORY AGREEMENT

    


    WITH

    


    The
      Federal Authority for Nuclear Regulation

    


    THIS
      CONSULTING AND STRATEGIC ADVISORY AGREEMENT,
      including ATTACHMENTS
      A through D,
      that
      are incorporated by reference, (this “Agreement”) is made as of August 1, 2008
      (the “Effective Date”), by and between Thorium Power, Ltd., a Nevada
      corporation, having its principal offices at 8300 Greensboro Drive, Suite 800,
      McLean, VA 22102, USA (“Thorium Power”), and the Federal Authority for Nuclear
      Regulation, an entity of the United Arab Emirates (“FANR”). The parties are
      individually referred to as the “Party” and collectively as the
“Parties.”

    


    RECITALS

    


    
      	
              A.

            	
              FANR
                is in the process of being formed to establish and manage nuclear
                regulatory activities in the UAE;

            


    

    


    
      	
              B.

            	
              Thorium
                Power has been providing consulting and strategic advisory services
                to the
                Executive Affairs Authority of Abu Dhabi for the evaluation and
                development of a nuclear energy program in the United Arab Emirates
                (“UAE”) and corresponding establishment of a nuclear regulatory authority
                in the UAE under two previous agreements (listed in Recitals
                C
                and D
                below), entered into with the Executive Affairs Authority of Abu
                Dhabi
                (“EAA”);

            


    

    


    
      	
              C.

            	
              FANR
                wishes to implement the “Roadmap” that was provided under the Professional
                Services Agreement of 30 November 2007 with the EAA and prepare for
                the
                continued evaluation of, and, if such evaluation is successful, the
                establishment of a
                nuclear regulatory authority in the
                UAE;

            


    

    


    
      	
              D.

            	
              On
                17 March 2008, EAA and Thorium Power entered into Amendment Number
                1 to
                the Professional Services Agreement of 30 November, 2007, to provide
                for
                early start of implementation of certain high-priority activities
                that
                were identified in the Roadmap (“Quick-Start
                Amendment”);

            


    

    


    
      	
              E.

            	
              Thorium
                Power maintains access to specialized expertise for providing consulting
                and strategic advisory services to FANR for the purpose of evaluating
                and,
                if relevant, the establishment of a nuclear regulatory authority
                in the
                UAE; and

            


    

    


    
      	
              F.

            	
              FANR
                desires to obtain Thorium Power’s services as an advisor in the design,
                implementation and management of the regulatory authority, and to
                support
                certain project management and execution activities related to developing
                the program as described in the Roadmap, where FANR forms a key part
                of
                the UAE Nuclear Energy Program Implementation Organization
                (“NEPIO”).

            


    

    


    NOW,
      THEREFORE,
      in
      consideration of the premises and mutual covenants contained herein and
      intending to be legally bound hereby, Thorium Power and FANR agree as
      follows:

     

    
      
        
        

      

      
        6

        
          

        

      

      
        
        

      

    

    

       
        

       

    

    1
      Consulting
      and Strategic Advisory Services

     

    
      	
            	1.1	
              Thorium
                Power Services 

            


    

     

    Thorium
      Power shall provide the following services to FANR:

     

    
      	 	
              ·

            	
              Act
                as strategic advisor to FANR and other UAE Government entities designated
                by FANR on civilian nuclear regulatory and energy matters, based
                on
                priorities set by FANR from time to
                time.

            


    

     

    
      	 	
              ·

            	
              Support
                the creation of FANR and its ongoing project management & project
                execution activities in relation to the evaluation and, if relevant
                development of the nuclear energy program of the UAE, where FANR
                has the
                responsibility to oversee nuclear regulatory activities in the UAE
                and is
                a key part of NEPIO. The services will generally be guided by the
                Roadmap
                with subsequent modifications of implementation objectives as agreed
                from
                time to time between the Parties.

            


    

     

    A
      detailed description of the services (‘Services”) is provided in ATTACHMENT
      A -
      STATEMENT OF WORK,
      which
      may be modified from time to time by agreement between the Parties as described
      below. 

     

    Thorium
      Power shall determine, in its best judgment and in consultation with FANR,
      the
      method and manner of providing its Services towards meeting the program
      objectives of FANR and plans outlined in the Roadmap. 

     

    
      	
            	1.2	
              Thorium
                Power Resources

            


    

     

    In
      order
      to provide the Services, Thorium Power shall provide the resources as described
      in ATTACHMENT
      B-THORIUM POWER RESOURCES,,
      which
      may be amended from time to time by agreement between the Parties as described
      in Section
      1.5
      (Quarterly Reviews). 

     

    In
      the
      case FANR wishes to increase the amount of Services and corresponding resources
      provided by Thorium Power, the Parties will agree on the time plan for such
      changes, and Thorium Power will use its best efforts to provide the resources
      according to the plan. 

     

    In
      the
      case FANR wishes to reduce the amount of Services and corresponding resources
      provided by Thorium, FANR shall give Thorium Power four (4) weeks notice to
      this
      effect, and shall pay Thorium Power at the prevailing rate for Services and
      corresponding expenses during such notice period. In the case such reduction
      of
      resources during any consecutive three (3) month period exceeds fifty percent
      (50%) of the prevailing total resource billings for Thorium Power Resources
      at
      the beginning of the period, FANR shall compensate Thorium Power for the group
      of resources corresponding to such reduction in the same manner as described
      in
Section
      3.3
      (Termination
      for Convenience);
      provided however, that no such “Termination for Convenience” compensation will
      be required in the case that Thorium Power’s resources providing Services do not
      exceed five (5) full-time equivalents. 

     

    
      
        
        

      

      
        7

        
          

        

      

      
        
        

      

    

    

       
        

    

     

    
      	
            	1.3	
              FANR
                Resources and Support 

            


    

     

    FANR
      will
      use its reasonable endeavours to provide the resources, facilitate the provision
      of resources from other UAE Government entities, perform the tasks and provide
      the support to Thorium Power as described in ATTACHMENT
      C—FANR
      SUPPORT,
      which
      may be amended from time to time by agreement between the Parties as described
      in Section
      1.5
      (Quarterly Reviews). Provided that breach of this obligation shall only entitle
      Thorium Power to relief from its obligations to perform the Services to the
      extent such obligations cannot be performed as a result of such breach and
      it
      shall not be entitled to any other remedies or compensation.

     

    
      	
            	1.4	
              Compensation

            


    

     

    Thorium
      Power shall receive compensation and invoice FANR in accordance with ATTACHMENT
      D- COMPENSATION 

     

    
      	
            	1.5	
              Quarterly
                Reviews

            


    

     

    Thorium
      Power will plan and facilitate quarterly reviews of the activities of the
      Parties under this Agreement, where the Parties will:

     

    
      	 	
              ·

            	
              Meet
                at a location agreed by the Parties (in Abu Dhabi unless agreed otherwise
                by the Parties).

            


    

     

    
      	 	
              ·

            	
              Review
                the performance of FANR departments, Thorium Power, other key vendors
                and
                other entities as relevant to the activities of the Parties under
                this
                Agreement, in relation to the program schedule, budget and other program
                objectives & policies; and Thorium Power shall prepare a written
                report in advance of the review on these topics.
                

            


    

     

    
      	 	
              ·

            	
              Modify,
                as appropriate and as agreed between, the Parties, the program schedule,
                budget or other objectives, and correspondingly agree on updates
                to the
                Services. 

            


    

     

    
      	 	
              ·

            	
              Review
                the staffing needs for the activities of the Parties under this Agreement
                (including Thorium Power’s resources) and agree on staffing changes as
                described in Article
                2
                (Staff
                Management).
                

            


    

     

    
      	 	
              ·

            	
              Review
                proposals for new or modified 3rd
                party service providers and equipment vendors.


            


    

     

    
      	 	
              ·

            	
              Update,
                as appropriate and as agreed between the Parties, the information
                included
                in Attachments
                A through D,
                as well as the names of individuals excluded from transfer to ENEC
                under
                the provisions of Clause 2.3 of this Agreement.


            


    

    


    
      
        
        

      

      
        8

        
          

        

      

      
        
        

      

    

    

       
        

       

    

    2 Staff
      Management 

     

    2.1 Objective

     

    The
      overall objective of this Agreement is the development of an exemplary nuclear
      regulatory authority in the UAE according to the plans outlined in the Roadmap.
      Thorium Power and FANR will cooperate to balance the need for speed of
      implementing the nuclear energy program in the UAE, the need for experienced
      experts, the need to develop a cadre of domestic nuclear regulatory experts
      over
      time, and the need to manage resource costs. 

     

    2.2 Recruiting
      of personnel 

     

    Thorium
      Power will support FANR in direct hiring of nuclear related personnel by FANR.
      

     

    2.3 Transfer
      of Personnel

     

    As
      part
      of managing the staffing for the nuclear regulatory activities in the UAE,
      Thorium Power shall, if and to the extent directed by FANR, over time, provide
      for a structured transfer of certain Thorium Power staff from its payroll into
      a
      direct contractual relationship with FANR. The Parties shall discuss and agree
      on the need for such transfers during the regular program reviews described
      in
Section
      1.5
      (Quarterly Reviews). 

     

    If,
      from
      time to time, FANR directs that there is to be the transfer of any staff in
      accordance with this Section 2.3, the provisions for the transfer of such staff
      from Thorium Power’s payroll to FANR’s payroll shall be as follows:

     

    
      	
            	·	
              Thorium
                Power shall cooperate in the transfer of eligible
                staff.

            


    

     

    
      	
            	·	
              Employment
                or consulting agreements between Thorium Power and transferring personnel
                shall be modified to the extent agreed between FANR and the relevant
                personnel immediately prior to transfer and Thorium Power shall waive
                applicable portions of non-compete provisions to facilitate the provisions
                of this Agreement. 

            


    

     

    
      	
            	·	
              No
                Thorium Power employees shall be eligible for transfer within twelve
                (12)
                months of the Effective Date. For the avoidance of doubt this does
                not
                apply to consultants to or agents of Thorium
                Power.

            


    

     

    
      	
            	·	
              Any
                employees of Thorium Power or its subsidiaries as set out in the
                side
                letter dated July 7, 2008 and signed by the President of Thorium
                Power
                shall only be eligible for transfer with the approval of Thorium
                Power.
                

            


    

     

    
      	
            	·	
              FANR
                shall provide three (3) months notice (“Transfer Notice Period”) to
                Thorium Power of the intention to hire Thorium Power staff
                directly.

            


    

     

    
      	
            	·	
              Following
                the transfer notice, FANR shall continue to pay Thorium Power for
                the
                resource during the Transfer Notice Period at the prevailing rate
                at the
                time of notice. 

            


    

     

    
      
        
        

      

      
        9

        
          

        

      

      
        
        

      

    

    

       
        

    

     

    
      	
            	·	
              Upon
                the effective transfer from Thorium Power’s payroll, FANR shall pay
                Thorium Power a transfer fee of thirty three percent (33%) of the
                individual’s new first twelve (12) months cash compensation (including
                salary and bonus target), plus reasonable costs as agreed to by the
                Parties to cover Thorium Power’s recruiting, training, administrative and
                overhead expenses. 

            


    

     

    
      	
            	·	
              No
                more than twenty five percent (25%) of Thorium Power’s employees as
                committed to FANR under this Agreement during any 12 month period
                can be
                transferred over the subsequent twelve (12) month period. For the
                avoidance of doubt, this paragraph does not apply to consultants
                to or
                agents of Thorium Power.

            


    

     

    
      	
            	·	
              In
                order to maintain stability in the project, FANR shall not discuss
                offers
                of employment, directly or indirectly, with Thorium Power employees
                without prior consultation with Thorium
                Power.

            


    

     

    
      	
            	2.4	
              Non-Solicitation 

            


    

     

    Except
      as
      provided in this Article
      2
      (Staff
      Management),
      during
      the period commencing on the date hereof and ending one (1) year after the
      termination of Thorium Power’s engagement under this Agreement or any extension
      thereof (the “Restricted Period”), FANR and its affiliates shall not directly or
      indirectly induce, solicit, persuade or entice or attempt to induce, solicit,
      persuade or entice any of the employees, of Thorium Power that were directly
      engaged in the provision of the Services to FANR to leave the employment of
      Thorium Power. For the avoidance of doubt, this provision does not apply in
      relation to any consultants to or agents of Thorium Power.

     

    3 Term
      and Termination

     

    
      	
            	3.1	
              Term 

            


    

     

    The
      term
      of this Agreement shall be five (5) years after the Effective Date unless
      earlier terminated as described below. Provided, however, that absent a
      termination notice from either Party, this Agreement shall be extended for
      one
      (1) year on the fourth (4th)
      anniversary of the Effective Date and every anniversary date thereafter such
      that the term of the Agreement will always have at least one (1) full year
      to
      run.


    
      	
            	3.2	
              Termination
                for Default 

            


    

     

    Subject
      to Section 1.2, this Agreement may be terminated (i) by either Party for the
      other Party’s default in materially complying with the provisions of this
      Agreement, and (ii) by FANR for Thorium Power’s default in materially complying
      with the provisions of the Nuclear Energy Program Consulting and Strategic
      Advisory Agreement between Thorium Power and the Emirates Nuclear Energy
      Corporation (“ENEC”) of even date hereto, by giving written notice of the
      default to the other Party and by allowing the other Party thirty (30) calendar
      days to cure any such default, if curable. If the default has not been cured
      within the period allowed for curing the default, this Agreement may be
      terminated with thirty (30) calendar days written notice. Upon termination
      of
      this Agreement for cause by either Party, FANR shall only be required to pay
      Thorium Power for Services performed and expenses incurred before the effective
      date of such termination.

     

    
      
        
        

      

      
        10

        
          

        

      

      
        
        

      

    

    

       
        

    

     

    
      	3.3	
              Termination
                for Convenience 

            


    

     

    Subject
      to Article 14, this Agreement may be terminated by FANR for its convenience
      by
      giving ninety (90) calendar days’ prior written notice to Thorium Power. During
      that period Thorium Power shall work with FANR to make an orderly exit.
      Notwithstanding any limitation on consequential damages in Section
      7.1
      (Disclaimer
      of Consequential Damages),
      upon
      such termination, FANR shall compensate Thorium Power for (i) all Services
      performed and expenses before the effective date of such termination and (ii)
      an
      additional wind-down fee which shall be the sum of the compensation for a period
      of four (4) weeks for all Thorium Power full time equivalent resources working
      under this Agreement on the date of termination, as compensation for Thorium
      Power’s expenses in connection with the termination of infrastructure contracts
      and other contracts benefiting the Services which may not be immediately
      cancellable. Such compensation shall be an exclusive remedy and shall be in
      full
      and final settlement of all claims arising from such termination and shall
      exclude all other liability of whatever nature arising in connection with the
      termination.

     

    4 Confidentiality

     

    4.1   Definition
      of Confidential Information

     

    The
      term
“Confidential Information” shall mean this Agreement and all trade secrets,
      data, know-how, data or other information and materials, business strategies,
      plans and procedures, business information, proprietary information, of a Party,
      the UAE, any Emirate of the UAE or any sub-division or governmental entity
      (including any regulator even where independent) of any of the foregoing, as
      well as any other information and materials that are deemed confidential or
      proprietary to or by a Party and are appropriately identified and designated
      as
      such by that Party. All information and documents of any nature provided to
      Thorium Power (whether before or after the Effective Date) by or on behalf
      of
      the EAA, FANR, ENEC, any other governmental entity, agency, regulator or
      corporation of the UAE or Abu Dhabi or any person owned or controlled by any
      of
      the foregoing (including all information, documents and advice provided to
      any
      of those entities by any legal adviser to any of those entities which is also
      received by Thorium Power) is hereby designated as Confidential Information
      by
      FANR.

     

    4.2  
Obligation
      of Confidentiality and Non-Use

     

    Thorium
      Power acknowledges and agrees that it owes a duty to FANR maintain in strict
      confidence all Confidential Information (as defined above) it has received
      or
      learned, or, which it has developed for FANR, during the term of this Agreement.
      Thorium Power shall take all steps reasonably necessary to prevent the
      unauthorized disclosure or dissemination of such Confidential Information for
      any reason and to any person or entity, except with the prior written consent
      of
      FANR. In addition, Thorium Power shall not use or copy any such Confidential
      Information, or authorize or permit others to use any such Confidential
      Information, for any purposes other than in connection with performance of
      the
      Services. Notwithstanding the foregoing, Thorium Power may disclose such
      Confidential Information to those of its officers, employees, and consultants
      of
      Thorium Power (each, a “Representative,”
and
      collectively, “Representatives”)
      who
      have a need to know such information in connection with performance of the
      Services under this Agreement provided that each Representative, prior to such
      disclosure, is informed by Thorium Power of the confidential nature of such
      information and of the confidentiality obligations imposed on Thorium Power
      under this Agreement. Thorium Power shall be responsible for any and all
      breaches of the provisions of this Article
      4
      (Confidentiality)
      by its
      Representatives. As used herein, “steps reasonably necessary” means the steps
      that a Party takes to protect its own, similarly confidential or proprietary
      information, which steps shall not be less than a reasonable standard of
      care.

     

    
      
        
        

      

      
        11

        
          

        

      

      
        
        

      

    

    

       
        

       

    

    4.3         
      Obligation
      to Inform

     

    Upon
      learning of any actual or threatened unauthorized disclosure or use of
      Confidential Information, Thorium Power shall provide FANR with notice thereof
      and cooperate with FANR in efforts to prevent or remediate such disclosure.
      

     

    4.4         
      Exceptions
      to Confidential Information 

     

    Notwithstanding
      the foregoing paragraph, “Confidential Information” shall not include any
      information that: (i) at the time of disclosure is in the public domain, or
      after disclosure becomes, through no fault of the receiving Party, part of
      the
      public domain as evidenced by generally available documents or publications;
      (ii) was or is supplied to the receiving Party by a third party as a matter
      of
      right and which is not subject to any restriction as to confidential treatment
      on the part of said third party; (iii) was available to the receiving Party
      on a
      non-confidential basis prior to its disclosure to the receiving Party by the
      disclosing Party; or (iv) was or is independently developed by the receiving
      Party or its Representatives without use of Confidential
      Information.

     

    4.5         
      Disclosure
      to Governmental Authorities 

     

    Thorium
      Power shall immediately notify FANR of any request by any third person, court,
      governmental or administrative body that Confidential Information be disclosed.
      The Parties shall cooperate in all efforts to protect the Confidential
      Information from disclosure and lessen the effects of such disclosure,
      consistent with applicable laws.

     

    4.6        
      Return
      or Destruction of Confidential Information 

     

    Upon
      the
      termination or expiration of this Agreement, or at any other time upon the
      written request of FANR, Thorium Power shall promptly return to FANR (or if
      FANR
      so request destroy) all Confidential Information (or, where the request is
      limited to specific information, such of it as may be specified in the request)
      in Thorium Power's or its staff's possession or control, together with all
      copies, summaries and analyses thereof, regardless of the format in which such
      information exists or is stored and shall procure the return or destruction
      of
      such information from any person to whom it has disclosed that confidential
      information. Within five (5) business days following the expiration or earlier
      termination of this Agreement, or any written request as set forth above,
      Thorium Power shall provide the other with a written certification of its
      compliance with the provisions of this Section
      4.6
      (Return
      or Destruction of Confidential Information).
      

     

    4.7         
      No
      waiver

     

    Thorium
      Power acknowledges that information and documents provided to it by any entity
      which contains advice from legal advisers to the EAA, ENEC, FANR, any other
      governmental entity, agency, regulator or corporation of the UAE or Abu Dhabi
      or
      any person owned or controlled by any of the foregoing is subject to legal
      professional privilege and the benefit of that privileged advice belongs to
      the
      relevant entity and no disclosure to Thorium Power or by Thorium Power shall
      be
      considered to be a waiver by the EAA, ENEC, FANR, any other governmental entity,
      agency, regulator or corporation of the UAE or Abu Dhabi or any person owned
      or
      controlled by any of the foregoing of such legal professional privilege or
      any
      other right of privilege which it may have or be able to assert in respect
      of
      that information.

     

    
      
        
        

      

      
        12

        
          

        

      

      
        
        

      

    

    

       
        

       

    

    5 Intellectual
      Property

     

    5.1         
      Ownership
      of Intellectual Property 

     

    All
      inventions, original works of authorship, findings, conclusions, data,
      discoveries, developments, concepts, improvements, trade secrets, techniques,
      processes, methodologies and know-how, whether or not patentable or registerable
      under copyright or similar laws, which the Parties may solely or jointly
      conceive or develop or reduce to practice, or cause to be conceived or developed
      or reduced to practice, in the performance of the Services under this Agreement
      (collectively, the “Inventions”) as well as any and all intellectual property
      rights inherent in the Inventions and appurtenant thereto including, without
      limitation, all patent rights, copyrights, trademarks, know-how and trade
      secrets (collectively, “Intellectual Property Rights”), shall become the sole
      property of FANR. 

     

    5.2         
      Further
      Assurances 

     

    Upon
      the
      request and at the expense of the other Party, any and all instruments and
      documents shall be executed and delivered and any other acts shall be taken
      as
      may be necessary or desirable to ensure that the Inventions and the Intellectual
      Property Rights are the sole property of FANR or to enable FANR to secure its
      rights in the Inventions and the Intellectual Property Rights in any and all
      jurisdictions.

     

    6 Limited
      Warranty and Disclaimer 

     

    THORIUM
      POWER WARRANTS TO FANR THAT (A) THE SERVICES WILL BE PERFORMED BY SUITABLY
      QUALIFIED AND EXPERIENCED PERSONNEL AS SPECIFIED IN THIS AGREEMENT TO RECOGNIZED
      NUCLEAR INDUSTRY STANDARDS AND WITH ALL REASONABLE SKILL AND CARE; (B) IN
      CONDUCTING THE SERVICES AND CREATING THE DELIVERABLES THORIUM POWER WILL NOT
      INFRINGE THE COPYRIGHT OR OTHER INTELLECTUAL PROPERTY RIGHTS OR MISAPPROPRIATE
      OR MISUSE THE CONFIDENTIAL INFORMATION OF ANY THIRD PARTY. THORIUM POWER
      WARRANTS TO USE ITS BEST EFFORTS TO ENSURE THAT ANY RESULTS, DELIVERABLES OR
      TECHNICAL DATA PROVIDED WILL BE ERROR FREE, CONFORM TO ANY RELIABILITY OR
      PERFORMANCE STANDARDS AND WILL MEET FANR’S NEEDS AND OBJECTIVES. THESE
      WARRANTIES ARE THE ONLY WARRANTIES GIVEN BY THORIUM POWER. THORIUM POWER HEREBY
      EXPRESSLY EXCLUDES AND DISCLAIMS ALL OTHER WARRANTIES, WHETHER EXPRESS, IMPLIED
      OR STATUTORY, REGARDING THE SERVICES OR THE DELIVERABLES, INCLUDING, WITHOUT
      LIMITATION, ANY IMPLIED WARRANTY OF MERCHANTABILITY, OF FITNESS FOR A PARTICULAR
      PURPOSE, AND ANY WARRANTY OR GUARANTY OF ABSENCE OF HIDDEN DEFECTS, ANY OTHER
      WARRANTY OF NON-INFRINGEMENT, AND ANY WARRANTY THAT MAY ARISE BY REASON OF
      USAGE
      OF TRADE, CUSTOM OR COURSE OF DEALING. 

     

    
      
        
        

      

      
        13

        
          

        

      

      
        
        

      

    

    

       
        

       

    

    The
      compensation for any rework shall be as stated in ATTACHMENT
      D-
      COMPENSATION.

     

    7 Disclaimers
      and Limitations of Liability

     

    7.1          Disclaimer
      of Consequential Damages 

     

    Neither
      Party shall be liable to the other Party hereto for any consequential,
      incidental, indirect, special, punitive or exemplary damages suffered or
      incurred by such other Party in connection with a breach or alleged breach
      of
      this Agreement, even if such other Party has been advised of the possibility
      of
      such damages. Consequential damages shall include, without limitation,
      opportunity costs, loss of use of facilities or other assets, claims of
      subcontractors, lost profits, lost savings, lost business or lost goodwill.
      

     

    7.2         
      Liability
      Cap 

     

    In
      no
      event shall either Party’s aggregate cumulative liability to the other Party
      arising out of or relating to this Agreement, the Services of the Deliverable
      exceed 2.5 times the cumulative Professional Fees payable to and Expenses
      incurred by Thorium Power for the Services, as specified in
      ATTACHMENT D-COMPENSATION
      .

     

    7.3        
      Applicability 

     

    The
      provisions of this Article
      7
      (Disclaimers
      and Limitations of Liability)
      shall
      apply to the full extent permitted by law whether such a claim is based on
      tort
      (regardless of the degree of fault or negligence), warranty, breach of contract,
      strict liability or otherwise, and shall survive the cancellation, expiration
      or
      termination of this Agreement, as well as the fulfilment of the obligations
      of
      the parties hereunder and shall apply notwithstanding any other provisions
      of
      this Agreement.

     

    7.4         
      Acknowledgement 

     

    The
      Parties, having been advised by legal counsel on all matters relating to this
      Agreement, acknowledge and agree that they are sophisticated parties in all
      matters relating to this Agreement and that the foregoing disclaimer and
      limitation of liability represent bargained-for allocations of risk, and that
      the economics, terms and conditions of this Agreement reflect such
      allocations.

     

    
      
        
        

      

      
        14

        
          

        

      

      
        
        

      

    

    

       
        

       

    

    8 Indemnification

     

    FANR
      agrees to indemnify, defend, and hold harmless Thorium Power and its officers,
      directors, employees and agents (hereinafter collectively “Indemnitees”) against
      and from any and all claims, demands, suits, costs and damages of every kind
      and
      description including reasonable attorneys' fees and/or litigation expenses
      in
      any jurisdiction, brought or made against any of the Indemnitees by third
      parties resulting from Thorium Power’s proper performance of this Agreement or
      Thorium Power entering into this Agreement, FANR or UAE’s future nuclear energy
      program provided that this indemnity:

     

    
      	 	
              (a)

            	
              shall
                not apply to any claims, demands, suits, costs or damages which arise
                directly or indirectly out of the gross negligence of any Indemnitee,
                the
                wilful default of any Indemnitee or the breach of this Agreement
                by
                Thorium Power; 

            


    

     

    
      	 	
              (b)

            	
              shall
                not apply to any claims, demands, suits, costs or damages which arise
                directly or indirectly out of any Nuclear Damage caused by a nuclear
                reactor outside of the UAE;

            


    

     

    
      	 	
              (c)

            	
              shall
                not apply to any claims, demands, suits, costs or damages to the
                extent
                that Thorium Power is insured to cover the costs to it of such claims,
                demands, suits, costs or damages, even in circumstances when the
                relevant
                insurance policy is taken out by FANR or a third party without the
                knowledge of Thorium Power; and 

            


    

     

    
      	 	
              (d)

            	
              notwithstanding
                Section 24.3, shall cease to apply upon any termination of this Agreement
                arising as a result of a breach of this Agreement by Thorium Power.
                

            


    

     

    9 Independent
      Contractor Status

     

    This
      Agreement does not create a joint venture, partnership or any other type of
      legal entity among the Parties and in no event shall the Parties represent
      to
      other persons that a joint venture, partnership, or other type of business
      entity has been formed. In making and performing this Agreement, the Parties
      hereto are acting and shall act as independent contractors. Neither Party is,
      nor shall be deemed to be, an agent, legal representative, joint venturer or
      partner of the other Party for any purpose. Neither Party has the authority
      under this Agreement to represent itself as having authority to obligate the
      other Party to act or refrain from acting and accordingly undetakes not to
      represent that it has such authority.

     

    
      
        
        

      

      
        15

        
          

        

      

      
        
        

      

    

     

    

       
        


      10 Compliance
        with Laws

       

      Thorium
        Power shall comply, and shall be responsible for ensuring that their
        Representatives (as defined in Section
        4.1
        (Definition
        of Confidential Information)
        comply,
        with all applicable laws including the laws of Abu Dhabi and the UAE pursuant
        to
        this Agreement. Without limiting the generality of the foregoing, Thorium
        Power
        shall not take any action, and it will ensure that its Representatives take
        no
        action, that would violate any anti-bribery and related prohibitions implemented
        under the Organization for Economic Cooperation and Development Convention
        on
        Combating Bribery of Foreign Public Officials in International Business
        Transactions, the Organization of American States Inter-American Convention
        Against Corruption, Council of Europe Criminal Law Convention on Corruption,
        the
        United Nations Convention Against Corruption, the African Union Convention
        on
        Preventing and Combating Corruption, the United States Foreign Corrupt Practices
        Act of 1977, as amended, or any other similar United States or foreign law,
        statute, rule or regulation, or any other similar laws of any country that
        would
        create any liability for Thorium Power or FANR under any such law. The Parties
        further understand that materials and information resulting from the performance
        of this Agreement may be subject to United States and UAE export control
        laws
        and regulations and that Thorium Power is responsible for its compliance
        with
        such laws in its activities. 

       

      11
        Notices

       

      Any
        notices required or permitted to be sent hereunder shall be delivered personally
        or mailed, certified mail, return receipt requested, or delivered by courier
        service to the following addresses, or such other address as any Party hereto
        designates by written notice to the other Party. Provided, however, a
        transmission per telefax or email shall be sufficient and shall be deemed
        to be
        properly served when the telefax or email is received if the signed original
        notice is received by the recipient within seven (7) calendar days
        thereafter.

       

      IF
        TO
        THORIUM POWER:

      


      Thorium
        Power, Ltd.

      8300
        Greensboro Drive, Suite 800

      McLean,
        VA 22102 USA

      United
        States of America

      Attention:
        Erik
        Hällström

      Chief
        Operating Officer

      Thorium
        Power, Ltd.

      Tel:
        +1.703.918.4923 

      Fax
        +1.703.935.1490 

      Email:
        ehallstrom@thoriumpower.com

      


      IF
        TO
        FANR:


      
        
          
          

        

        
          16

          
            

          

        

        
          
          

        

      

      
        
          

             
              

          

        


        [Address]

      

      Attention:
        [name, title]

      


      Telephone:
        

      Fax:

      E-Mail: 

      


      12 Choice
        of Law and Dispute Resolution

       

      12.1 Governing
        Law. 

       

      This
        Agreement shall be governed by, and construed in accordance with the laws
        of
        England and Wales.

       

      12.2 Mediation
        of Disputes. 

       

      With
        respect to any disputes and controversies of any kind or nature arising under
        or
        in connection with this Agreement, the Parties agree to submit such dispute
        or
        controversy to mediation for a sixty (60) calendar day period (such period
        commencing on the date the mediator is appointed), and agree to make good
        faith
        efforts to resolve such dispute or controversy in meditation. If the dispute
        or
        controversy is not resolved in the above-described sixty (60) calendar day
        period, neither Party shall be obligated to continue in mediation. Such
        mediation shall be held with an experienced mediator, who shall be selected
        by
        agreement of the Parties. In the event the Parties are unable to agree upon
        the
        mediator, within thirty (30) calendar days of a written request by either
        Party
        to do so, then at the request of either Party, the London Court of International
        Arbitration shall appoint the mediator. In the event that the Parties are
        unable
        to resolve any dispute or controversy in mediation, then upon the expiration
        of
        the sixty (60) calendar day period, from the date of agreement or appointment
        of
        the mediator (as appropriate) either Party may submit any such dispute or
        controversy to arbitration in accordance with the provisions of this
Article
        12
        (Choice
        of Law and Dispute Resolution).

       

      12.3 Resolution
        of Disputes.

       

      Any
        dispute arising out of or in connection with this Agreement including any
        question regarding its existence, validity or termination, shall be referred
        to
        and finally resolved by arbitration under the London Court of International
        Arbitration (LCIA) Rules, which are deemed to be incorporated by reference
        into
        this Article
        12
        (Choice
        of Law and Dispute Resolution).
        The
        number of arbitrators shall be three (3).The claimant shall nominate one
        arbitrator. The respondent shall nominate one arbitrator. The third arbitrator
        who shall be the chairman of the tribunal shall be selected by the LCIA Court.
        The seat, or legal place, of arbitration shall be London, United Kingdom.
        The
        language to be used in the arbitral proceedings shall be English. The
        arbitrators shall not alter, amend or modify the terms and conditions of
        this
        Agreement but shall consider the pertinent facts and circumstances and be
        guided
        by the terms and conditions of this Agreement and applicable law which shall
        be
        binding upon them in resolving any dispute or controversy hereunder. In no
        event
        may the arbitrators award punitive or consequential damages. If a solution
        is
        not found in the terms of this Agreement, the arbitrators shall be guided
        by the
        substantive law of England and Wales, excluding all conflicts of law rules.
        The
        decision by the arbitrators shall be final and binding upon the Parties,
        their
        successors, and assigns and the Parties shall comply with such decision in
        good
        faith. Each Party hereby submits itself to the jurisdiction of the courts
        of the
        place where the arbitration is held, but only for the entry of judgment with
        respect to the decision of the arbitrator hereunder. Notwithstanding the
        foregoing, judgment upon the award may be entered in any court where the
        arbitration takes place, or any court of competent jurisdiction. 

       

      
        
          
          

        

        
          17

          
            

          

        

        
          
          

        

      


       
        


      12.4 Decision. 

       

      The
        arbitrators’ award shall include a reasoned basis for the award. The arbitrators
        will not have power to award damages in connection with any dispute in excess
        of
        actual compensatory damages and will not multiply actual damages or award
        consequential or punitive damages or award any other damages that are excluded
        under the provisions of Article
        7 (Disclaimer and Limitations of Liability).

       

      12.5 Discovery. 

       

      In
        addition to discovery that may be permitted under the LCIA Rules of Arbitration,
        the Parties shall be permitted limited discovery of facts, documents, testimony
        and other evidence. Once the Parties have provided notice to one another
        of the
        claims, matters and issues in dispute, the Parties may take discovery in
        the
        following manner:

       

      (1) The
        Parties may request discovery as provided in the International Bar Association
        Rules for the Taking of Evidence in International Arbitration. Discovery
        requests may be made after the three-arbitrator panel has been
        appointed.

       

      (2) The
        arbitration panel shall resolve any disputes relating to discovery.


       

      12.6 Submission
        to Jurisdiction. 

       

      For
        purposes of (i) compelling arbitration under this Agreement or (ii) entering
        judgment on any arbitration award under this Agreement or for any other
        proceeding relating to the arbitration, each of the Parties hereby: (A)
        irrevocably submits to the non-exclusive jurisdiction of the English Courts
        and
        (B) irrevocably waives, to the fullest extent permitted by applicable law,
        any
        objection it may now or hereafter have to such jurisdiction.

       

      12.7 Fees;
        Expenses. 

       

      The
        Parties shall equally advance the fees and expenses of the LCIA and the
        arbitrators. The arbitrators in their award shall apportion such fees and
        expense between the Parties in such amounts as the arbitrators determine
        is
        appropriate.

       

      12.8 Amendment
        to LCIA Rules

       

      The
        LCIA
        Rules shall be amended as follows:

       

      (1) the
        Request for Arbitration under Article 1 of the Rules shall also contain the
        Statement of Case provided for by Article 15.2 of the Rules; the Request
        shall
        be accompanied by the documents required by Article 15.6 of the
        Rules;

       

      (2) the
        tribunal shall conduct proceedings on the basis of documents and other materials
        only, unless the Tribunal, in its absolute discretion, decides that it is
        necessary to hold an oral hearing, and Article 19(1) of the Rules shall be
        amended accordingly;

       

      
        
          
          

        

        
          18

          
            

          

        

        
          
          

        

      


       
        


      (3) if
        at any
        point in the proceedings any party fails for any reason to avail itself of
        the
        opportunity to present its case in accordance with the Rules (as amended
        by this
        clause) or as directed by the tribunal, the tribunal shall proceed with the
        arbitration and make an award.

       

      12.9 Agents
        for Service of Process

       

      Without
        prejudice to any other method of service allowed by law, Thorium Power appoints
        Pillsbury Winthrop Shaw Pittman LLP, Tower 42, Level 23, 25 Old Broad Street
        London, EC2N 1HQ, United Kingdom and FANR appoints [ ] as their respective
        agents for service or process in any proceedings before the English Courts.
        If
        any person appointed as process agents is unable for any reason to act, the
        party which appointed the process agent, must immediately appoint another
        agent
        and failing such appointment within fourteen (14) days of the event taking
        place, the other party may appoint the agent. Failure by a process agent
        to
        notify a party of any process will not invalidate the relevant
        proceedings.

       

      13 Nature
        of Agreement

       

      Cognizant
        of the fact that this Agreement is subject to civil and commercial law with
        respect to its obligations hereunder, and the execution, delivery and
        performance of this Agreement constitute private and commercial acts rather
        than
        public or governmental acts. The Parties hereby explicitly accept the
        jurisdiction of the LCIA to resolve any dispute.

       

      14 Force
        Majeure

       

      Neither
        Party shall be liable to the other for delays or failures in performing its
        obligations under this Agreement due directly or indirectly to any act (“Force
        Majeure”), comprising (i) acts of God; (ii) acts, including failures to act
        or delays in acting, of any governmental authority (de
        jure
        or
de
        facto),
        (iii) accidents or disruptions such as wars (declared or undeclared),
        riots, revolutions, acts of terrorism, world disturbances, fires, floods,
        earthquakes, storms, sabotage, nuclear incidents, epidemics; (iv) strikes,
        labor disputes, labor difficulties or (v) any event not related to the
        performance of the Services which is beyond its reasonable control. The
        foregoing shall apply even though any of such causes exists at the time of
        this
        Agreement or occurs after a Party’s performance is delayed or otherwise hindered
        for other causes. In the event of any delay or failure excused by this
Article
        14
        (Force
        Majeure),
        the
        Party whose performance is delayed shall as soon as practical (1) notify
        the
        other Party, (2) continue to perform the Services to the extent it is able
        to do
        so; (3) take all reasonable steps to minimize the impact of the event of
        force
        majeure on the FANR including the impact of any delay and rectify any failure
        to
        perform and (4) specify the revised performance date. In the event of such
        delay, the time of performance shall be extended for a period equal to the
        time
        lost by reason of the delay. If the delay exists for more than ninety (90)
        calendar days and Thorium Power is the affected party, FANR shall be entitled
        to
        terminate this Agreement for convenience in accordance with Section
        3.3
        (Termination
        for Convenience)
        provided that, for these purposes, the reference to "ninety (90) calendar
        days'"
        in Section 3.3 shall be consider to be a reference to "one (1)
        days'".

       

      
        
          
          

        

        
          19

          
            

          

        

        
          
          

        

      


       
        


      15 Insurance

       

      Thorium
        Power shall, in respect of its liabilities under this Agreement, take out
        and
        maintain on and from the Effective Date until the date which is 12 months
        after
        the expiry or termination of this Agreement professional indemnity insurance
        with first class insurers of sound repute and financial standing, on an each
        and
        every claim basis, for an amount equal to US$5,000,000 per claim. Thorium
        Power
        shall ensure that FANR is named as a co-insured on each policy of professional
        indemnity insurance referred to above and shall ensure that each such policy
        contains endorsements which ensure that: (a) FANR's interest in any such
        policy
        shall not be terminated, vitiated, abrogated or otherwise adversely affected
        as
        a result of any action or inaction (including any non-disclosure) by any
        other
        insured; (b) FANR is the loss payee in respect of any claims made by FANR
        on
        such policies; and (c) there is a waiver of subrogation provision benefiting
        FANR. Thorium Power will on each renewal or replacement of any policy referred
        to above provide evidence (in form and substance reasonably satisfactory
        to
        FANR) of its compliance with this Article 15.

       

      16 Licenses
        and Taxes

       

      As
        part
        of the Services, Thorium Power shall (a) pay
        all
        taxes, duties and fees, and obtain all permits, licences and approvals
        associated with the Services. Any payment of taxes on income levied by the
        US or
        its political subdivisions or any other country shall not be part of the
        Services and FANR shall not compensate Thorium Power for such costs. FANR,
        as
        requested by Thorium Power, shall provide assistance and services as are
        described in ATTACHMENT
        B- -
        THORIUM POWER RESOURCES
        with
        respect to such licenses and authorizations. The Parties shall assist each
        other
        in every manner reasonably possible in securing such authorizations and tax
        exemptions as may be required. 

       

      17 Quality
        Assurance Procedures 

       

      Thorium
        Power shall establish and implement written procedures (“Quality Assurance
        Procedures”) covering the delivery of the Services that meets IAEA standards and
        is suitable for the work with FANR. The Quality Assurance Procedures shall
        be
        made available for review and approval by FANR. Thorium Power shall amend
        the
        Quality Assurance Procedures in order to obtain FANR's approval. Review and
        approval by FANR of Thorium Power’s Quality Assurance Procedures shall not
        relieve Thorium Power of its responsibility to perform all Services in
        accordance with the Quality Assurance Procedures and the other provisions
        of
        this Agreement.

       

      
        
          
          

        

        
          20

          
            

          

        

        
          
          

        

      

      

         
          



      
        	
              	17.1	
                Subcontractor
                  Quality Assurance
                  Procedures

              


      

       

      In
        accordance with Thorium Power’s Quality Assurance Procedures, Thorium Power
        shall require its Subcontractors to establish, implement and maintain
        appropriate quality assurance procedures which shall meet the requirements
        of
        Thorium Power’s Quality Assurance Procedures.

       

      
        	
              	17.2	
                Non-conformances 

              


      

       

      Thorium
        Power shall provide FANR with an opportunity to audit any reports of a
        non-conformance under the Quality Assurance Procedures or any Subcontractor’s
        quality assurance procedures, or any non-conformance of a Service.

       

      
        	
              	17.3	
                Adequacy
                  of Methods and Equipment 

              


      

       

      If
        at any
        time FANR determines that Thorium Power's or a subcontractor’s methods,
        performance or any other aspect or element of the Services are inadequate
        for
        ensuring the requisite quality, FANR may order Thorium Power to improve its
        performance and/or change its procedures or staff, and Thorium Power shall
        take
        all actions necessary so as to ensure the quality of the Services and compliance
        with the requirements of this Agreement. 

       

      18 Labor
        and Immigration Laws 

       

      Thorium
        Power shall comply with the applicable labor and immigration laws that may
        impact the Services under this Agreement. Thorium Power shall perform employment
        eligibility and verification checks and maintain employment records, as required
        by applicable laws. 

       

      19 Training
        of Employees 

       

      Thorium
        Power and Subcontractor personnel shall be trained on environmental and
        occupational safety and health, as well as nuclear safety requirements before
        they are assigned to the Thorium Power team for duties that require knowledge
        regarding such matters. 

       

      No
        person
        that is employed or engaged by Thorium Power or its Subcontractors shall
        be
        physically and/or mentally unfit for the performance of the Services.


       

      
        
          
          

        

        
          21

          
            

          

        

        
          
          

        

      

      

         
          

      

      20 Safety
        Culture

       

      The
        International Atomic Energy Agency’s (IAEA) International Nuclear Safety
        Advisory Group’s (INSAG) INSAG-4 publication, defines safety culture as “that
        assembly of characteristics and attitudes in organizations and individuals
        which
        establishes that, as an overriding priority, nuclear plant safety issues
        receive
        the attention warranted by their significance. Thorium Power shall conform
        to
        all IAEA standards in establishing a safety culture. As part of that culture,
        Thorium Power shall comply with all applicable Abu Dhabi and UAE laws and
        regulations which prohibit Discrimination against workers for engaging in
        certain Protected Activities. “Discrimination” includes discharge or any other
        adverse actions that relate to compensation, terms, conditions, and privileges
        of employment. The term “Protected Activities” includes, among other things,
        workers raising nuclear safety or quality control complaints either internally
        to their employer or to a regulatory agency. Thorium Power shall fully
        investigate, and ensure that its Subcontractors investigate, any allegation
        of
        Discrimination for engaging in Protected Activities with respect to Work
        under
        this Agreement.

       

      Within
        two (2) business days after the receipt by Thorium Power or any of its
        Subcontractors of (i) an allegation associated with Services under this
        Agreement by a worker or former worker of Thorium Power or any of its
        Subcontractors of Discrimination because of engagement in Protected Activities
        or (ii) notice of the filing of a complaint to any competent authority by
        any
        such worker or former worker, Thorium Power shall cooperate fully with any
        investigation of any such allegations.

       

      Thorium
        Power shall ensure that no agreement affecting the compensation, terms,
        conditions and privileges of employment, including, but not limited to, any
        agreement to settle a complaint filed by a worker or former worker of Thorium
        Power or a Subcontractor under applicable law shall contain any provision
        which
        prohibit, restrict, or otherwise discourages a worker or former worker from
        participating in any Protected Activity, including, but not limited to,
        providing information to FANR or any other competent regulatory
        authority.

       

      Thorium
        Power shall ensure that its employees understand that they can raise safety
        related concerns and directly contact the competent regulatory agencies without
        fear of employer reprisals or job related discrimination.

       

      21 Code
        of Ethics 

       

      Thorium
        Power shall maintain and comply with a “Code of Ethics.” Subcontractors shall
        comply with a code of ethics that is consistent with Thorium Power’s Code of
        Ethics. FANR shall have the right to review Thorium Power’s Code of Ethics and
        be informed of any change in the code be such change comes into
        force.

       

      
        
          
          

        

        
          22

          
            

          

        

        
          
          

        

      


       
        


      22 Safeguards
        Information 

       

      Thorium
        Power and its Subcontractors may have access to “Safeguards Information”
provided by the International Atomic Energy Agency (IAEA), the UAE, foreign
        governments, or industry participants during performance of the Services.
        Safeguards Information is information not otherwise classified or restricted
        that identifies (1) security measures for the physical protection of special
        nuclear material or (2) security measures for the physical protection and
        location of certain plant equipment vital to the safety of nuclear production
        or
        utilization facilities. Without prejudice and in addition to Article 4, Thorium
        Power agrees that Safeguards Information shall be handled and protected from
        unauthorized disclosure in accordance with the requirements of the applicable
        Abu Dhabi and UAE authorities.

       

      23 Nuclear
        Liability Protection

       

      Thorium
        Power shall not be the owner or operator of any nuclear facility in the UAE.
        The
        Services provided by Thorium Power shall be advisory. Thorium Power shall
        not be
        required to supply any services that could result in a claim for nuclear
        damages
        against either Party and that the public is properly protected, the Parties
        shall take the following actions. 

       

      24 Miscellaneous

       

      
        	
              	24.1	
                Assignment 

              


      

       

      The
        Parties recognize that, for the reasons stated in the Recitals above, this
        Agreement is personal as to the Parties. Therefore, a Party may not assign
        or
        transfer this Agreement or any of its rights or obligations created hereunder,
        by operation of law or otherwise, without the prior written consent of the
        other
        Party. Provided however, FANR may transfer all or any rights and/or obligations
        in this agreement to any governmental entity (including without limitation
        any
        regulator whether or not indepemdent) of the UAE or any Emirate of the UAE
        or
        any entity which is owned or controlled by one or more such governmental
        entities and Thorium Power with the prior written consent of FANR (such consent
        not to be unreasonably withheld or delayed) may assign its rights in this
        Agreement to a person who is and at all times remains a Controlled Affiliate.
        A
        Controlled Affiliate is an entity that is controlled by, that controls or
        is
        under common control with, Thorium Power; and, for this purpose, “control” with
        respect to any entity shall mean the ability to effectively control, directly,
        the operations and business decisions of such Person by the voting of shares
        or
        other securities 

       

      
        
          
          

        

        
          23

          
            

          

        

        
          
          

        

      


       
        


      
        	
              	24.2	
                No
                  Third Party Beneficiaries 

              


      

       

      This
        Agreement is solely for the benefit of, and shall inure to the benefit of,
        the
        Parties and their respective successors and permitted assigns, and this
        Agreement shall not otherwise be deemed to confer upon or give to any third
        party any right, claim, cause of action or other interest herein.

       

      
        	
              	24.3	
                Survival 

              


      

       

      The
        provisions of Article 4 (Confidentiality),
Article 5 (Intellectual
        Property), Article
6 (Limited Warranty and Disclaimer), Article
7 (Disclaimers
        and Limitations of Liability), Article 8
        (Indemnification), Article 10 (Compliance with
        Laws), Article 12 (Choice of Law and Dispute
        Resolution), Article 15 (Insurance) and Article 23 (Nuclear
        Liability Protection) shall remain in full force and effect
        notwithstanding the termination or expiry of this Agreement.

       

      
        	
              	24.4	
                Headings 

              


      

       

      The
        headings used in this Agreement are included for convenience only and are
        not to
        be used in construing or interpreting this Agreement.

       

      
        	
              	24.5	
                Amendments
                  or Modifications 

              


      

       

      This
        Agreement may not be released, discharged, amended or modified in any manner
        except by an instrument in writing signed by the Party or Parties to be
        bound.

       

      
        	
              	24.6	
                Reproduction
                  of Documents 

              


      

       

      This
        Agreement and all documents relating hereto, including, but not limited to,
        (i)
        consents, waivers, amendments and modifications which may hereafter be executed
        and (ii) certificates and other information previously or hereafter furnished,
        may be reproduced by any photographic, photostatic, microfilm, optical disk,
        micro-card, miniature photographic or other similar process. The Parties
        agree
        that any such reproduction shall be admissible in evidence as the original
        itself in any judicial or administrative proceeding, whether or not the original
        is in existence and whether or not such reproduction was made by a Party
        in the
        regular course of business, and that any enlargement, facsimile or further
        reproduction of such reproduction shall likewise be admissible in
        evidence.

       

      
        	
              	24.7	
                Severability 

              


      

       

      Any
        provisions of this Agreement which are determined to be invalid or unenforceable
        in any jurisdiction shall be ineffective to the extent of such invalidity
        or
        unenforceability in such jurisdiction, without rendering invalid or
        unenforceable the remaining provisions of this Agreement or affecting the
        validity or enforceability of such provisions in any other jurisdiction.
        If an
        arbitral panel or a court of competent jurisdiction declares any provision
        of
        this Agreement to be invalid or unenforceable, the Parties shall request
        that
        such arbitral panel or court reduce the scope, duration, or area of the
        provision, delete specific words or phrases from the provision, or replace
        the
        provision with a provision that is valid and enforceable and that comes closest
        to expressing the original intention of the Parties, and this Agreement shall
        be
        enforceable as so modified in the jurisdiction in which the provision was
        declared invalid or unenforceable.

       

      
        
          
          

        

        
          24

          
            

          

        

        
          
          

        

      


       
        


      
        	
              	24.8	
                Contract
                  Construction 

              


      

       

      For
        purposes of contract construction, or otherwise, this Agreement is the product
        of negotiation and neither Party to it shall be deemed to be the drafter
        of this
        Agreement or any part thereof.

       

      
        	
              	24.9	
                Entire
                  Agreement 

              


      

       

      Except
        as
        otherwise expressly set forth in this Agreement, those documents expressly
        referred to herein and other documents of even date herewith embody the complete
        agreement and understanding among the Parties, written or oral, which may
        have
        related to the subject matter hereof in any way.

       

      
        	
              	24.10	
                Counterparts 

              


      

       

      This
        Agreement may be executed in any number of counterparts, each of which shall
        be
        an original as against any Party whose signature appears thereon, but all
        of
        which together constitute but one and the same instrument.

       

      [Signature
        page follows]


      
        
          
          

        

        
          25

          
            

          

        

        
          
          

        

      

      

         
          



      IN
        WITNESS WHEREOF, the Parties have caused this Agreement to be executed and
        delivered as of the Effective Date by their duly authorized
        representatives:

      

        
          	
                  THORIUM
                    POWER, LTD. 

                	 	
                  EMIRATES
                    NUCLEAR ENERGY CORPORATION

                
	 	 	 
	
                  By:

                	/s/
                  Seth Grae	 	
                  By:

                	/s/
                  Khaldoon Al Mubarak
	 	 	 	 	 
	
                  Name: 

                	Seth
                  Grae	 	
                  Name: 

                	Khaldoon
                  Al Mubarak
	 	 	 	 	 
	
                  Title:

                	President
                  and CEO	 	
                  Title:

                	Chairman,
                  Executive Affairs Authority


        

      

       

      
        
          
          

        

        
          26

          
            

          

        

        
          
          

        

      

      

         
          

      

      ATTACHMENT
        A -
        STATEMENT OF WORK

       

      From
        23
        June through 31 December 2008, Thorium Power will provide the following
        Services:

      


      
        	1.	
                Design
                  and Launch of FANR Organization:

              


      

      


      
        	 	
                ·

              	
                Provide
                  direction on FANR organizational structure, position definitions
                  and
                  operating procedures, utilizing international industry best
                  practices.

              


      

      


      
        	 	
                ·

              	
                Act
                  as surrogate for key nuclear & regulatory related management positions
                  (pending permanent hires) to quickly establish operational policies
                  and
                  initiate productive work.

              


      

      


      
        	 	
                ·

              	
                Act
                  as mentor: transfer expert knowledge from the Thorium Power team
                  to
                  personnel in the permanent FANR organization and provide operational
                  support to assure successful
                  transition.

              


      

      


      
        	 	
                ·

              	
                Support
                  recruiting strategy and execution for nuclear & regulatory specific
                  permanent positions in FANR, and help establish network of nuclear
&
                  regulatory recruiting sources for the new HR
                  functions.

              


      

       

      
        	2.	
                Development
                  and Execution of FANR’s Operational and Administrative
                  Plans:

              


      

      


      
        	 	
                ·

              	
                Provide
                  strategic advice to FANR organization and department heads on nuclear
                  & regulatory matters.

              


      

      


      
        	 	
                ·

              	
                Provide
                  project management expertise to enable meeting key FANR development
                  objectives.

              


      

      


      
        	 	
                ·

              	
                Execute,
                  under direction of incoming FANR department heads, nuclear &
                  regulatory related projects across the new
                  organization.

              


      

       

      Thorium
        Power will propose and the Parties will agree on more detailed work plans
        for Q3
        and Q4 of 2008 outlining specific FANR objectives and Thorium Power’s
        corresponding role and deliverables. 

      


      In
        providing Services herein, Thorium Power shall operate at all times under
        the
        direction of FANR; however, Thorium Power will also comply with reasonable
        requests of other competent governmental organizations that are (i) consistent
        with this Agreement and (ii) in accordance with directions or instructions
        received from FANR.


      
        
          
          

        

        
          27

          
            

          

        

        
          
          

        

      


       
        

      


      ATTACHMENT
        B -
        THORIUM POWER RESOURCES

       

      For
        the
        period from 23 June through 31 December 2008, Thorium Power will provide
        a
        project team organized into three functional teams, corresponding to the
        main
        work-streams to build the new FANR organization and execute key operational
        and
        development activities:

      


      
        	 	
                1.

              	
                FANR
                  Development & Management

              


      

      
        	 	
                ·

              	
                Supporting
                  FANR Director General, Board and its support
                  functions.

              


      

      


      
        	 	
                2.

              	
                FANR
                  Administration

              


      

      
        	 	
                ·

              	
                Supporting
                  FANR administrative department, including finance and
                  budgeting.

              


      

      


      


      
        	 	
                3.

              	
                FANR
                  Operations

              


      

      
        	 	
                ·

              	
                Supporting
                  departments within FANR responsible for e.g., security & safeguards,
                  licensing, regulations and rad
                  safety.

              


      

      


      The
        Thorium Power team will be managed as follows:

      


      
        	 	
                ·

              	
                Thorium
                  Power will form and manage the functional teams consisting of qualified
                  and experienced personnel with appropriate expertise including
                  management
                  of nuclear regulatory authorities, IAEA related matters, nuclear
                  technology, licensing, security & safeguards, regulations, rad safety,
                  fee structure design and budgeting for regulatory authorities,
                  regulatory
                  staff management and recruiting.

              


      

       

      
        	 	
                ·

              	
                Each
                  functional team will have a project leader who will interface with
                  the
                  corresponding FANR department heads. Thorium Power will designate
                  such
                  project leaders in consultation with FANR. The leader of the functional
                  team FANR Development and Management will act as head of the Thorium
                  Power
                  team and will interface with FANR’s Director
                  General.

              


      

      


      Thorium
        Power shall provide FANR with descriptions of the team members, their background
        and their roles, and shall keep FANR reasonably informed of changes.


      


      While
        taking into account the need to keep FANR adequately informed of its activities,
        Thorium Power shall determine the composition of its project team, which
        may
        vary over time. Except as otherwise provided in this Agreement, Thorium Power
        shall furnish all supervision, labor, equipment, and materials, and shall
        obtain
        all licenses and permits required for the performance of the Services. Thorium
        Power shall also be solely responsible for the selection of the means, methods,
        and procedures of performing the Services.


      
        
          
          

        

        
          28

          
            

          

        

        
          
          

        

      

      

         
          



      ATTACHMENT
        C –
        FANR
        SUPPORT

       

      For
        the
        period from 23 June through 31 December 2008, until permanent staff has been
        hired into the various FANR departments, FANR will provide:

      


      
        	 	
                ·

              	
                Temporary
                  interfaces for Thorium Power’s project leaders in order to adequately
                  review and approve work product, and make decisions related to
                  the
                  Services, as outlined in ATTACHMENT
                  A-
                  STATEMENT OF WORK

              


      

      


      
        	 	
                ·

              	
                Working
                  resources available to be embedded into Thorium Power’s functional
                  teams.

              


      

      


      
        	 	
                ·

              	
                Facilitate
                  Thorium Power’s interactions with UAE government
                  authorities.

              


      

       

      
        
          
          

        

        
          29

          
            

          

        

        
          
          

        

      

      

         
          



      ATTACHMENT
        D –
        COMPENSATION

      


      
        	
                1.

              	
                Professional
                  Fees

              


      

       

      For
        the
        period from 23 June through 31 December 2008, FANR shall pay Thorium Power
        an
        amount of Professional Fees (“2008 Q3/Q4 FANR Project Professional Fees”) for
        the Services outlined in ATTACHMENT
        A- STATEMENT OF WORK
        equal to
        USD
        8,540,000 (eight million five hundred forty thousand U.S. dollars). FANR
        shall
        make a pre-payment to Thorium Power equal to the 2008 Q3/Q4
        FANR Project Professional Fees within 10 (ten) business days of the Effective
        Date of this Agreement. 

      


      Thorium
        Power shall invoice FANR monthly for Professional Fees. The invoice shall
        include a description of the resources agreed between the Parties for the
        corresponding period, a summary of work performed and the corresponding amounts.
        If FANR and Thorium Power agree to reduce or increase the staff provided
        by
        Thorium Power (in accordance with Article
        2
        (Staff
        Management),
        the
        amount of this monthly compensation will be reduced or increased to reflect
        the
        then current cost of the staff, adjusted according to the previously agreed
        rates by the Parties for corresponding levels of staff. If the cumulative
        invoiced amounts are less than the 2008 Q3/Q4 FANR Project Professional Fees,
        invoiced amounts shall be credited against the 2008
        Q3/Q4
        FANR Project Professional Fees pre-paid by FANR until the 2008
        Q3/Q4
        FANR Project Professional Fees are reached with no further payment obligation
        by
        FANR. When the cumulative invoiced amounts exceed the 2008
        Q3/Q4
        FANR Project Professional Fees, payment shall be handled in accordance with
        Section 3 of this ATTACHMENT
        D-COMPENSATION.

       

      
        	
                2.

              	
                Expenses

              


      

       

      FANR
        shall reimburse Thorium Power for reasonable out of pocket expenses properly
        incurred by Thorium Power or its agents or subcontractors and directly
        attributable to the provision of the Services provided hereunder, including,
        without limitation, travel, subsistence and other expenses directly attributable
        to the provision of Services, provided however that such expenses shall not
        exceed twenty percent (20%) of the Professional Fees earned by Thorium Power
        on
        a rolling, cumulative basis without the prior written approval of FANR. For
        the
        avoidance of doubt, expenses shall not include general overhead of Thorium
        Power
        or any professional fees paid to agents or subcontractors of Thorium Power.
        The
        expenses shall be billed to FANR at cost without any administrative charge.
        Business-class travel shall be authorized for international travel.


      


      For
        avoidance of doubt, Thorium Power shall, unless explicitly agreed by the
        Parties, not be responsible for costs related to FANR staff or FANR’s
        subcontractors, including corresponding recruiting expenses (including
        recruiting costs paid to search firms). Moreover, it is assumed that Thorium
        Power staff will work out of out of office space provided or paid by FANR
        when
        in the UAE. 

      


      
        	
                3.

              	
                Invoices
                  

              


      

       

      Except
        as
        stated in Section 1 of this
        ATTACHMENT D-COMPENSATION,
        FANR
        will pay invoices for Professional Fees and Expenses under this Agreement
        within
        thirty (30) calendar days of receipt of an invoice.

      


      All
        payments due to Thorium Power hereunder shall be made in U.S. dollars by
        wire
        transfer of immediately available funds to the following account:



      
        
          
          

        

        
          30

          
            

          

        

        
          
          

        

      

      

         
          



      Beneficiary
        Name: Thorium Power, Ltd.

      Bank
        Name: Bank of America

      State
        in
        which bank account was opened: Virginia

      Bank’s
        SWIFT Code: BOFAUS3N

      Beneficiary’s
        Account #: 004131870642

      


      
        	
                4.

              	
                Offsets
                  

              


      

       

      FANR
        may
        offset invoice payments to reflect amounts owing from Thorium Power pursuant
        to
        this Agreement. 

      


      
        	
                5.

              	
                Taxes

              


      

       

      Thorium
        Power shall follow the direction FANR concerning the payment of taxes in
        the
        UAE. The Professional Fees and Expenses to be paid by FANR to Thorium Power
        as
        stated in this
        ATTACHMENT D COMPENSATION shall
        include compensation for all taxes, other than income taxes paid in the United
        States, that are borne by Thorium Power as a result of its performance hereunder
        including, without limitation, sales, use, and value-added taxes. State and
        local sales and use taxes shall be stated separately and shown on all invoices
        as a separate line item. Upon request of FANR, Thorium Power shall promptly
        provide to FANR evidence of payment of all state and local sales, use, and
        value-added taxes.

      


      
        	
                6.

              	
                Record
                  Keeping 

              


      

       

      Thorium
        Power shall keep accurate and complete accounting records in support of
        reimbursable Expenses payable by the FANR in accordance with generally accepted
        accounting principles governing Thorium Power’s operations. 

       

      
        
          
          

        

        
          31