Exhibit 3.40
 GLADIOLI ENTERPRISES SDN BHD
 BUKIT LINTANG ENTERPRISES SDN BHD
 CARINO SDN BHD
 PRIORITY TRADING SDN BHD
 BUROI MINING SDN BHD
 GUNONG WANG MINING SDN BHD
 BUKIT YOUNG GOLDMINE SDN BHD
 BAU MINING LIMITED
 ZEDEX MINERALS LIMITED
 LING LEE SOON
 JOHN BIN JAIS @ JAE
 RICHARD HOU HEE PHAT
 and
 NATURAL KALIMANTAN GOLD SDN BHD
 
 EXPLORATION AND SHAREHOLDERS AGREEMENT
RELATING TO THE BAU PROJECT
 
 Claymore Law  Barristers Solicitors  Level Claymore House  Fort Street  Auckland




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TABLE OF CONTENTS
 Clause
    
    Page1.
    
    Definitions
    
    
    22.
    
    Interpretation
    
    
    123.
    
    Warranties And Governmental Approval
    
    
    134.
    
    Covenants In Respect Of The Tenements
    
    
    185.
    
    Payment Of Back Rent
    
    
    206.
    
    Tenements
    
    
    197.
    
    Security For Project Loan
    
    
    218.
    
    Non-Engagement In Other Business Activities
    
    
    219.
    
    Kalimantan Gold
    
    
    2110.
    
    Completion
    
    
    2211.
    
    FIC Consent
    
    
    2612.
    
    Exploration
    
    
    2713.
    
    Funding Of Exploration
    
    
    2914.
    
    Preference Shares
    
    
    3015.
    
    Right Of Access To The Exploration Area
    
    
    3016.
    
    Decision To Develop
    
    
    3117.
    
    Withdrawal
    
    
    3518.
    
    Project Development
    
    
    3619
    
    Failure To Procure Finance
    
    
    3620.
    
    Application Of Surplus Funds
    
    
    3721.
    
    Release Of Tenements / Disposal of Land
    
    
    3722.
    
    Miscellaneous
    
    
    3823.
    
    Operations
    
    
    3924.
    
    Warranty Of Authority To Act
    
    
    4025.
    
    Training By BML
    
    
    4026.
    
    No Partnership
    
    
    4027.
    
    Force Majeure
    
    
    4028.
    
    Confidentiality
    
    
    4129.
    
    Governing Law
    
    
    4230.
    
    Arbitration
    
    
    42
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Clause
    
    Page31.
    
    Place And Mode Of Arbitration
    
    
    4232.
    
    Parties To Co-Operate
    
    
    4233.
    
    Costs Of Agreement
    
    
    4334.
    
    Final Cessation Of Operations
    
    
    4335.
    
    Notices
    
    
    4336.
    
    Assignment And Delegation
    
    
    4437.
    
    Pre-Emptive Rights
    
    
    4438.
    
    Sale/Transfer Of Shares
    
    
    4539.
    
    Deed Of Assumption
    
    
    4640.
    
    Gladioli Quarry Areas
    
    
    4641.
    
    Default
    
    
    4742.
    
    Counterparts
    
    
    4843.
    
    Partial Validity
    
    
    4844.
    
    Specific Performance
    
    
    4845.
    
    Other Business Opportunities
    
    
    4846.
    
    Entire Agreement
    
    
    48
 Schedule A  List Of Tenements
    
    
    53Schedule A  Maps
    
    
    56Schedule B  Management
    
    
    61Schedule C  Board of Directors
    
    
    66Schedule D  Expired Licences
    
    
    77Schedule E  Initial Exploration Programme
    
    
    78Schedule F  Share Capital Of Gladioli Companies
    
    
    79Schedule G  Back-Rent Owed
    
    
    80Schedule H  Power of attorney regarding Development and Mining and Ore
Sale and Purchase Agreements
    
    
    84Schedule I  Intentionally left blank
    
    
    89Schedule J  Development and Mining Agreement
    
    
    90Schedule K  Ore Sale and Purchase Agreement
    
    
    99Schedule L  FIC Application Letter
    
    
    105Schedule M  Power of Attorney
    
    
    109
 2




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EXPLORATION AND SHAREHOLDERS AGREEMENT
 THIS AGREEMENTis dated 03 NOV 2006
    
    2006
 BETWEEN
 1.
    
    GLADIOLI ENTERPRISES SDN BHD (Company No. 89270-K),a company
incorporated in Malaysia and having its registered office at Lots 9 and 10, Block H,
Taman Sri Sarawak, Level 2, Jalan Borneo, 93100 Kuching, Sarawak, Malaysia
(Gladioli);2.
    
    BUKIT LINTANG ENTERPRISES SDN BHD (Company No. 91725-H),a
company incorporated in Malaysia and having its registered office at Lots 9 and 10, Block
H, Taman Sri Sarawak, Level 2, Jalan Borneo, 93100 Kuching, Sarawak, Malaysia (Bukit
Lintang);3.
    
    CARINO SDN BHD (Company No. 100173-V),a company incorporated in
Malaysia and having its registered office at Lots 9 and 10, Block H, Taman Sri
Sarawak, Level 2, Jalan Borneo, 93100 Kuching, Sarawak, Malaysia (Carino);4.
    
    PRIORITY TRADING SDN BHD (Company No. 89740-K),a company
incorporated in Malaysia and having its registered office at Lots 9 and 10, Block H,
Taman Sri Sarawak, Level 2, Jalan Borneo, 93100 Kuching, Sarawak, Malaysia
(Priority Trading);5.
    
    BUROI MINING SDN BHD (Company No. 35548-U),a company incorporated in
Malaysia and having its registered office at Lots 9 and 10, Block H, Taman Sri
Sarawak, Level 2, Jalan Borneo, 93100 Kuching, Sarawak, Malaysia (Buroi
Mining);6.
    
    GUNONG WANG MINING SDN BHD (Company No. 72530-H),a company
incorporated in Malaysia and having its registered office at Lots 9 and 10, Block H,
Taman Sri Sarawak, Level 2, Jalan Borneo, 93100 Kuching, Sarawak, Malaysia
(Gunong Wang);7.
    
    BUKIT YOUNG GOLDMINE SDN BHD (Company No. 41863-X),a company
incorporated in Malaysia and having its registered office at Lots 9 and 10, Block H,
Taman Sri Sarawak, Level 2, Jalan Borneo, 93100 Kuching, Sarawak, Malaysia
(Bukit Young);8.
    
    BAU MINING LIMITED (Company No. 28544),a company incorporated in Samoa
under the International Companies Act 1987 and having its registered office at
Internist Limited, Level 1, Central Bank of Samoa Building, Beach Road, Apia,
Samoa(BML);
 
 1




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9.
    
    ZEDEX MINERALS LIMITED (Company No. 944539),a company incorporated
in New Zealand and registered as a foreign company in Australia (ARBN 107 523
428) and having its registered office at Level 2, Claymore House, 63 Fort Street,
Auckland, New Zealand (Zedex);10.
    
    LING LEE SOON (Malaysian Identity Card No. 450126-13-5081)of 39, Jalan 2,
Taman Sri Ukay, 68000 Ampang, Selangor, Malaysia (Mr Ling);11.
    
    JOHN BIN JAIS @ JAE (Malaysian Identity Card No. 410502-13-5151)of 2G,
Lane 4, Drive 22, Jalan Chong Jin Bock, Sibu, Sarawak, Malaysia (Mr Jae);12.
    
    RICHARD HOU HEE PHAT (Singaporean Identity Card No. S0170122) (Mr
Hou); and13.
    
    NATURAL KALIMANTAN GOLD SDN BHD (Company No. 666174-A),a
company incorporated in Malaysia and having its registered office at Lots 9 and 10, Block
H, Taman Sri Sarawak, Level 2, Jalan Borneo, 93100 Kuching, Sarawak, Malaysia
(Kalimantan Gold).
 RECITALS
 WHEREAS:
 A.
    
    The Gladioli Companies own the entire legal and equitable interest in the Tenements.B.
    
    The Gladioli Companies have offered BML and Zedex the opportunity to participate
in a joint venture via Kalimantan Gold to explore, develop, and mine on the
Tenements.C.
    
    The Gladioli Companies have agreed to assign all of their equitable and economic
interests in the Bau Project to Kalimantan Gold.D.
    
    Gladioli, Zedex and BML have also agreed on how development and operation of any
mine is to be managed.E.
    
    The parties hereto have agreed to enter into this Agreement to set out their agreement
in relation to the above mentioned matters and to provide for the management and
operation of Kalimantan Gold and the joint venture and to set out the rights and
obligations of the parties hereto inter se.F.
    
    The Gladioli Shareholders have agreed to join in this Agreement for the purpose of
providing the guarantees and/or other assurances hereinafter contained.
 NOW IT IS HEREBY AGREED AND DECLARED
 1.
    
    Definitions
 2




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1.1
    
    For the purposes of this Agreement and unless the context otherwise requires, the
following expressions shall have the meanings respectively assigned to them:the Actor the Ordinanceshall mean The Mining Ordinance, 1949 (Chapter 83), The
Mining (Amended) Ordinance, 1965 (Chapter 83), The Mining Rules made under Section 99 of
the Mining (Amended) Ordinance, 1965 (Chapter 83) and the Minerals Ordinance, 2004 as may
be in force from time to time together with all rules and regulations for the time being
in force;Affiliatemeans any person, partnership, joint venture, corporation or other form of
enterprise which directly or indirectly controls, is controlled by, or is under common
control with, a party. For the purpose of the preceding sentence, control means
possession, directly or indirectly, of the power to direct or cause direction of management
and policies through ownership of voting securities, contract, voting trust or otherwise;Bau Projectmeans the Tenements together with all geo scientific and other information
and other assets relating thereto, including the Specified Assets;Bukit Young Plantmeans the ore processing plant located at Bau, Sarawak, which is
presently owned by Bukit Young Goldmine Sdn Bhd;Bumiputerameans:
 (a)
    
    For Peninsula Malaysia, a Malay individual or aborigine as defined in Article
160(2) of the Federal Constitution;(b)
    
    For Sabah, a native as defined in Article 161(A)(6)(b) of the Federal
Constitution; and(c)
    
    For Sarawak, a native as defined in Article 161A(6)(a) of the Federal
Constitution.
 Commercial Production Date
 Company
 Completion
 Completion Date
 Default Event
 3




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(a)
    
    the party deals or purports to deal with any share in Kalimantan Gold or the
Milling Company otherwise than in accordance with clause 37 or the
provisions of the constitution of the relevant company;(b)
    
    the party commits a material or substantial breach of any provision of this
Agreement and such breach is either incapable of being remedied or if it can be
remedied it remains unremedied for a period of 30 days after notice requiring
such breach to be remedied is given by another party;(c)
    
    without in any way limiting (b) above, the Gladioli Companies fail to execute
and enter into the Ore Sale and Purchase Agreement and/or the Development
and Mining Agreement as required by Clause 16.8(h);(d)
    
    without in any way limiting (b) above, the Gladioli Companies fail to comply
with their obligations under Clause 16.7(a);(e)
    
    an Insolvency Event occurs in relation to that party;
  Defaulting Shareholder
 Development Decision
 Development and Mining Agreement
 Development Expenditure
 (a)
    
    all wages and salaries of personnel engaged in work in respect of a Project
(whether such personnel are employed by or seconded to Kalimantan Gold or
the Milling Company) for the periods for which they are so engaged plus an
amount to cover superannuation, sick leave, holiday pay and other salaries and
wages overhead and accounting and administrative and other indirect costs in
respect of such personnel for such period;(b)
    
    all costs associated with the design, construction and operation of each Mine
and Mill;(c)
    
    the amount charged for depreciation of fixed assets, plant and equipment used
in the course of the Project against the accounts of Kalimantan Gold or the
Milling Company, in accordance with IFRS;
 4




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(d)
    
    costs of providing transport, maintaining material and equipment and
personnel;(e)
    
    travel, accommodation, subsistence and reasonable out-of-pocket expenses in
respect of personnel;(f)
    
    costs of all necessary insurances;(g)
    
    interest on borrowings;(h)
    
    fees payable to the Manager pursuant to Schedule B in connection with any Project;(i)
    
    fees to be paid to accountants, solicitors, engineers, geologists, metallurgists and other
professional and technical consultants in respect of services performed in connection with
the Project;(j)
    
    capital expenditure;(k)
    
    all other direct expenditure reasonably incurred in developing, amending and implementing
each Project Programme; and(l)
    
    such other costs, payments and expenses as the board of directors of Kalimantan Gold or the
Milling Company may from time to time agree.
 Environmental Law
 Environmental Liability
 Expenditure
 Expired Licenses
 Exploration
 Exploration Area
 5




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Exploration Expenditure
 (a)
    
    all rentals and other payments to the Federal or any statutory or local
government authority in respect of the Tenements;(b)
    
    the wages and salaries of personnel engaged in work in respect of the
Exploration Area (whether such personnel are employed by or seconded to
Kalimantan Gold) for the periods for which they are so engaged plus an
amount to cover superannuation, sick leave, holiday pay and other salaries and
wages overhead and accounting and administrative and other indirect costs in
respect of such personnel for such period;(c)
    
    costs of drilling, surveys, and other services performed by contractors
employed in and about such work in respect of the Exploration Area and costs
of (and costs in connection with) assaying, sampling, testing, and analysing for
possible exploitation of minerals mined from the Exploration Area in the
course of Exploration;(d)
    
    the amount charged for depreciation of Kalimantan Golds fixed assets, plant
and equipment used in the course of Exploration against the accounts of
Kalimantan Gold, in accordance with IFRS;(e)
    
    costs of providing transport, maintaining material and equipment and
personnel;(f)
    
    travel, accommodation, subsistence and reasonable out-of-pocket expenses in
respect of personnel;(g)
    
    costs of all necessary insurances;(h)
    
    interest on borrowings (including dividends on the preference shares);(i)
    
    fees payable to the Manager pursuant to Schedule B in connection with Exploration;(j)
    
    fees to be paid to accountants, solicitors, engineers, geologists, metallurgists and other
professional and technical consultants in respect of services performed in connection with
the Exploration Area and the Tenements;(k)
    
    capital expenditure;(1)
    
    for the avoidance of doubt, all costs referred to in clauses 5.1 and 12.6;(m)
    
    all other direct expenditure reasonably incurred in developing, amending and implementing
each Exploration Programme; and(n)
    
    such other costs, payments and expenses as the board of directors of Kalimantan Gold may
from time to time determine.
 6




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Exploration Programme
 FIC
 Final Feasibility Study
 Finance Period
 Gladioli Companies Gladioli Company
 Gladioli Shareholders Gladioli Shareholder
 IFRS
 Information
 Initial Exploration Programme
 Insolvency Event
 7




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(a)
    
    a court order is made that the party be wound up, or a party is declared
bankrupt;(b)
    
    a court order is made appointing a liquidator, or provisional liquidator in
respect of the party, or one of them is appointed, whether or not under an order;(c)
    
    a receiver, receiver and manager, or official or statutory manager is appointed
in respect of the party or the assets or undertaking of the party or any part
thereof;(d)
    
    the party enters into, or resolves to enter into, a scheme of arrangement or
composition with, or assignment for the benefit of all or any class of its
creditors, or it proposes a reorganisation, moratorium or other administration
involving any of them;(e)
    
    an application for an order under Section 176(1) and/or (10) of the Companies
Act, 1965 is made in relation to such party;(f)
    
    the party resolves to wind itself up, or otherwise dissolve itself, or gives notice
of intention to do so;(g)
    
    the party is, or states that it is, unable to pay its debts as and when they become
due and payable;(h)
    
    anything having a substantially similar effect to any of the events specified above
happens under any law of any applicable jurisdiction.
 Interest Rate
 LIBOR
 Manager
 Memorandum and Articles
 Mill
 Milling Company
 8




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case may be) and operating the Mill, the shares in which are to be held 55% by BML and 45%
by Gladioli as hereinafter provided;Minemeans a mine for gold and/or other minerals within the Exploration Area developed,
equipped and operated by or on behalf of Kalimantan Gold and includes all earthworks, plant,
infrastructure, accommodation, messing, offices and ancillary facilities and structures necessary
therefore;Non-Defaulting Shareholdermeans, in relation to a Default Event, the shareholder(s) which is
not the Defaulting Shareholder;Ore Sale and Purchase Agreementmeans the agreement attached as Schedule K;Partial Withdrawalmeans the withdrawal (whether voluntary or deemed pursuant to Clause 19) of
BML from the Relevant Area and the surrender by Kalimantan Gold of all its rights under this
Agreement with respect to the Relevant Area and the surrender by BML or the assignment by BML to
Gladioli (whichever Gladioli directs) of all its rights, interest, title and benefits in and to
this Agreement with respect to the Relevant Area, for an aggregate consideration of RM10.00. It
includes the removal by Kalimantan Gold of all caveats lodged by Kalimantan Gold on the Tenements
granted over the Relevant Area (and BML shall agree to and shall procure such removal), the
transfer of the relevant Tenements to Gladioli (to the extent that such Tenements are in the name
of Kalimantan Gold), the relinquishment of the Powers of Attorney (but only to the extent that the
same confers rights on Kalimantan Gold with respect to the relevant Tenement(s)), the discharge by
Kalimantan Gold of all security interests on such Tenements lodged pursuant to Clause 7.1(b) (and
BML shall agree to and shall procure such discharge), and the doing by BML of all acts and things
as may be reasonably required by Gladioli to ensure that neither BML nor Kalimantan Gold has any
further rights, interest, title in or any benefit under this Agreement in respect of the Relevant
Area or any gold, gold dore, ore or other products of or proceeds from Exploration of the Relevant
Area. Thereafter:
 (a)
    
    BML and Kalimantan Gold shall have no further rights, obligations or interest
hereunder or pursuant to any other agreement executed by the parties hereto in
relation to the Relevant Area, except in respect of obligations incurred but not
discharged prior thereto, or obligations referable to any act occurring prior
thereto, and BML shall be deemed to have released and forever discharged the
other parties from any and all future claims, demands, actions or causes of
action of any kind or nature arising out of all Expenditure (insofar as such
expenditure is directly referable to the Relevant Area) and any other claim in
exchange for payment of the said RM10.00 to BML;(b)
    
    none of the Gladioli Companies nor the Gladioli Shareholders shall have any
further rights, obligations or interest hereunder or pursuant to any other
agreement executed by the parties hereto in relation to the Relevant Area,
except in respect of obligations incurred but not discharged prior thereto, or
obligations referable to any act occurring prior thereto, and each shall be
deemed to have released and forever discharged BML and Kalimantan Gold
from any and all future claims, demands, actions or causes of action of any
kind or nature arising out of the Relevant Area, all Expenditure (insofar as such
 9




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expenditure is directly referable to the Relevant Area) and any other claim relating to
the Relevant Area; and(c)
    
    Gladioli shall be entitled to the benefit of all Information relating solely to the
Relevant Area which has been derived, developed, prepared or carried out by
Kalimantan Gold during the course of Exploration including any Final
Feasibility Study in respect of the Relevant Area; and(d)
    
    BML shall write off and shall have no claim against Gladioli for any sums
loaned to Gladioli which are used for the purpose of financing Gladiolis
subscription for preference shares in Kalimantan Gold under Clause 13 insofar
as such sums are directly connected to Exploration Expenditure in respect of
the Relevant Area.
 Powers of Attorneymeans the irrevocable registrable Powers of Attorney in the form attached as
Schedule M to be granted by each of the Gladioli Companies to Kalimantan Gold in respect of the
Tenements, pursuant to which Kalimantan Gold will be granted the sole and exclusive power to
explore, develop, and mine the Tenements and exercise all rights of the Gladioli Companies with
respect to the Tenements and Power of Attorneymeans any one of them;Preference Share Ratemeans 1.8 x the Interest Rate;Projectmeans the development, equipping and operation of a Mine or Mines and/or the
construction and operation of a Mill and/or the sale of milled product;Project Areameans the land occupied by the Mine or Mines and the Mill;Project Programmeshall mean the programme and budget approved by the board of directors of
Kalimantan Gold and/or the Milling Company (as relevant) in respect of a Project in accordance
with the provisions of Clause 16.3, as revised from time to time;Related Companyhas the meaning given to it in section 6 of the Companies Act 1965;Relevant Area,in respect of any Partial Withdrawal, means the area the subject of a Development
Decision in respect of which BML has been unable to commit or obtain finance for the relevant
Project as required by clause 19.1;RMor Ringgitmeans the lawful currency of Malaysia;Specified Assetsmeans the office buildings located in the area covered by ML 102, the Bukit
Young Plant and the other process plant facilities and tailing dam located in the areas covered by
ML 109 and 122, the previous site offices (in the Exploration Area and Tenements) used by Menzies
Gold Limited and all other buildings and assets on the Exploration Area, all freehold land owned by
a Gladioli Company in respect of the Bau Project and all other rights and interests of the Gladioli
Companies in land the subject of the Tenements;
 10




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Shareholdersmeans Gladioli and BML while they are and remain shareholders of Kalimantan Gold
or the Milling Company (as the case may be), and any other person who may in accordance with the
provisions of this Agreement become the registered holder of any shares in either Kalimantan Gold
or the Milling Company and Shareholdermeans any one of them;Tenementsmeans:
 (a)
    
    those mining tenements (including mining certificates, exclusive prospecting licenses and
general prospecting licenses) listed in Schedule A and outlined in the maps attached to
Schedule A;(b)
    
    any other mining tenement or mining tenements which may be granted in lieu of or relate to the same
ground as the mining tenements referred to in paragraph (a);(c)
    
    any other mining tenement or mining tenements which may be granted to a Gladioli
Company, a Gladioli Shareholder, Kalimantan Gold or a Related Company of any of the
foregoing, over ground abutting (or in the area of) the mining tenements referred to in
paragraphs (a) and (b); and
 includes all rights associated with the mining tenements referred to in paragraphs (a), (b) and
(c), all survey and technical information relating to such mining tenements and adjacent areas and
other privileges appurtenant to such mining benefits.Withdrawalmeans the voluntary total withdrawal of BML from this Agreement and the surrender by
Kalimantan Gold of all its rights under this Agreement in relation to the Tenements and the
surrender by BML or the assignment by BML to Gladioli (whichever Gladioli directs) of all its
rights, interest, title and benefits in and to this Agreement (except as noted in paragraph (e)),
for an aggregate consideration of RM10.00. It includes the removal by Kalimantan Gold of all
caveats lodged by Kalimantan Gold on the Tenements (and BML shall agree to and shall procure such
removal), the transfer of the Tenements in the name of Kalimantan Gold to Gladioli, the
relinquishment of the Powers of Attorney, the discharge by Kalimantan Gold of all security
interests on the Tenements lodged pursuant to Clause 7.1(b) (and BML shall agree to and shall
procure such discharge), and the doing by BML of all acts and things as may be reasonably required
by Gladioli to ensure that neither BML nor Kalimantan Gold has any further rights, interest, title
in or any benefit under this Agreement (except as noted in paragraph (e)), the Tenements, any
Final Feasibility Study in respect of the Tenements, or any gold, gold dore, ore or other products
of or proceeds from Exploration. Thereafter:
 (a)
    
    BML and Kalimantan Gold shall have no further rights, obligations or interest hereunder or
pursuant to any other agreement executed by the parties hereto in relation to the Tenements,
except in respect of obligations incurred but not discharged prior thereto, or obligations
referable to any act occurring prior thereto, and BML shall be deemed to have released and
forever discharged the other parties from any and all future claims, demands, actions or
causes of action of any kind or nature arising out of all Expenditure (insofar as such
 11




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##### 



expenditure is referable to the Tenements) and any other claim in exchange for
payment of the said RM10.00 to BML;(b)
    
    none of the Gladioli Companies nor the Gladioli Shareholders shall have any
further rights, obligations or interest hereunder or pursuant to any other
agreement executed by the parties hereto in relation to the Tenements, except
in respect of obligations incurred but not discharged prior thereto, or
obligations referable to any act occurring prior thereto, and each shall be
deemed to have released and forever discharged BML and Kalimantan Gold
from any and all future claims, demands, actions or causes of action of any
kind or nature arising out of this Agreement, all Expenditure (insofar as such
expenditure is referable to the Tenements) and any other claim;(c)
    
    Gladioli shall be entitled to the benefit of all Information relating to the
Tenements which has been derived, developed, prepared or carried out by
Kalimantan Gold during the course of Exploration (including any Final
Feasibility Study in respect of the Tenements) or in undertaking a Project;(d)
    
    BML shall write off and shall have no claim against Gladioli for any sums
loaned to Gladioli which are used for the purpose of financing Gladiolis
subscription for preference shares in Kalimantan Gold under Clause 13; and(e)
    
    this Agreement shall terminate, provided that clauses 3.3, 4.3, 21.4, 28,
paragraph 9 of Schedule B and all other provisions which are intended to
survive termination of this Agreement shall remain in force notwithstanding
such termination.
 2.
    
    Interpretation2.1
    
    Words importing the singular shall include the plural and vice versa; reference to
persons shall include corporations; all headings in this Agreement have been inserted
for convenience only and shall not affect the interpretation thereof.2.2
    
    All references to a statute or to any guideline or directive, or any Section of, Schedule
to or other provision of a statute, guideline or directive, include any modification,
extension, re-enactment or replacement thereof in force at any particular time and in
respect of a statute includes all regulations, rules, orders, directives, notices and other
instruments then in force and made under or deriving validity from the relevant statute
or Section.2.3
    
    Words importing any gender include the other genders.2.4
    
    No waiver of any provision of this Agreement nor consent to any departure therefrom,
by any of the parties hereto shall be effective unless the same shall be in writing and
then such waiver or consent shall be effective only in the specific instance and for the
purpose for which it is given. No default or delay on the part of any of the parties
hereto in exercising any rights, powers or privileges hereunder shall operate as a
waiver thereof or of any other right hereunder; nor shall a single or partial exercise
thereof preclude any other or further exercise thereof or the exercise of any other right,
power or privilege hereunder.
 12




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2.5
    
    Where, by virtue of the provisions of this Agreement, the day on or by which any act,
matter or thing is to be done is a Saturday, a Sunday or a public holiday in the place in
which the act, matter or thing is to be done, it may be done on the next succeeding day
which is not a Saturday, a Sunday or a public holiday.2.6
    
    This Agreement shall be binding on the successors-in-title of the parties hereto and
where the context so admits shall include the assigns and the persons or corporations
deriving title under them respectively.2.7
    
    All Schedules and Annexures to this Agreement shall be taken read and construed as
an essential part of this Agreement.2.8
    
    References to Clauses and Schedules are to be construed as references to Clauses of and
Schedules to this Agreement.2.9
    
    Any covenant not to do anything also constitutes an obligation not to suffer, permit, or
cause that thing to be done.2.10
    
    Unless otherwise stated in this Agreement, where two or more persons or parties are
included or comprised in any expression, agreement, covenant, term, stipulation or
undertaking expressed to be made to such persons, such expression, agreement,
covenant, term, stipulation or undertaking shall be enforceable by such persons or
parties jointly and severally and any expression, agreement, covenant, term, stipulation
or undertaking expressed to be made by or on the part of such persons or parties shall
be deemed to be made by and be binding upon such persons or parties severally.2.11
    
    Any reference in this Agreement to an instrument shall be construed so as to include
any other instrument amending or substituting such instrument or supplemental to
such instrument.3.
    
    Warranties And Governmental Approval3.1
    
    Each of the Gladioli Companies and the Gladioli Shareholders (in each case jointly and
severally) warrants to and for the benefit of each of BML and Kalimantan Gold and, from its
incorporation, the Milling Company, that:
 (a)
    
    subject to clause 40, no person or entity (other than BML and Kalimantan
Gold) has been granted any right or interest (conditional or otherwise) over or
in respect of the Bau Project or the Tenements and all rights and interest in the
Bau Project and the Tenements are vested solely and absolutely in the Gladioli
Companies;(b)
    
    the issued share capital of each of Kalimantan Gold and the Gladioli
Companies is as set out in Schedule F and there are no options, warrants or
other rights granted over the issued or unissued share capital of any of those
companies except as disclosed in Schedule F;
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(c)
    
    legal and beneficial ownership of the shares in the Gladioli Companies vests
solely and absolutely in the Gladioli Shareholders and none of the Gladioli
Shareholders holds any such shares on trust for any third person;(d)
    
    there is not presently pending against a Gladioli Company any action, suit,
claim, dispute or other proceeding that may prevent the Gladioli Companies
from completing their obligations as described in this Agreement and no
Gladioli Company has notice of any such proceeding now or in contemplation
by any person;(e)
    
    no Gladioli Company is under an obligation to third parties, contractual or
otherwise, which would inhibit or prevent it from performing any or all of its
obligations under this Agreement;(f)
    
    no receiver or other administrator has been appointed over the whole or any
part of the assets or undertakings of a Gladioli Company and no such
appointment has been threatened or is envisaged;(g)
    
    no Gladioli Company is in bankruptcy or official management and no order,
petition, application, meeting or resolution has been made, presented, brought,
called or passed for the purpose of bankrupting or winding up a Gladioli
Company or placing any of them in official management;(h)
    
    no Gladioli Company is insolvent or otherwise unable to pay its debts, and there is no
unfulfilled or unsatisfied judgment or court order outstanding against any Gladioli Company;(i)
    
    except for inter-company debts there is no debt or other obligation owed by a Gladioli
Company to any third party (including any shareholder, officer or employee), which has the
potential materially to reduce its value;(j)
    
    there has been no contravention of any law in consequence of which an unfavorable judgment,
decision, ruling or order might materially or adversely affect the Bau Project or its assets,
including the Tenements and each of the Tenements is in good standing;(k)
 (i)
    
    renewals of the Expired Licenses are being processed by the relevant
government departments and the Expired Licenses will be renewed by the relevant
authorities, subject to the prevailing laws and regulations of Malaysia from time to
time;(ii)
    
    the terms of the renewed Expired Licences will be no less favourable (on a
best endeavours basis) to the licence holder than the terms of the original Expired
Licences;
 (1)
    
    it has done and will continue to do all things necessary to obtain renewals of the Expired
Licenses and it will not do or permit or allow anything to be done which might delay or
prevent any such renewal;
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(m)
    
    Schedule D contains a complete and accurate summary of the current status of
each Expired Licence;(n)
    
    other than the Expired Licences (and except for ML101 which is still awaiting renewal
application and ML 102 (approved for renewal on 7 July 2004) which is awaiting reissuance due
to a mapping error when first issued), all Tenements are current and in good standing and the
relevant Gladioli Company has complied with all of its obligations under such Tenements
(including obligations under applicable laws and regulations). For avoidance of doubt, the
Sarawak Government through its proper licensing authority, Department of Lands and Surveys
has issued approvals of the renewals of the said mining leases under the new format and the
relevant Gladioli Companies have complied with the terms and conditions of the mining leases
renewed thereby permitting the Gladioli Companies to carry out mining operations within the
areas as delineated in each of maps attached to each of the respective mining leases approved
for renewals. The Gladioli Companies shall indemnify BML and Kalimantan Gold from and against
any loss (including loss of profits and lost opportunities) or damage they suffer or incur on
account of not being allowed by Sarawak Government to carry out mining operations within the
areas of mining leases approved under the renewals to the relevant Gladioli Companies
Provided Always that such indemnity will not apply in respect of any loss or damage suffered
or incurred as a result of BML or Kalimantan Gold failing to comply with all relevant
requirements of Mining Rule 1995 and all other relevant rules and regulations in respect of
such mining leases;(o)
    
    each of the mining leases listed in Part A of Schedule A has been issued on the dates
referred to in Schedule A;(p)
 (i)
    
    the mining certificates listed in Part B of Schedule A which are due to
expire on or before 31 December 2008 will be renewed subject to requirements of
relinquishment of areas as required by prevailing laws and regulations;(ii)
    
    the terms of the renewed mining certificates referred to in (i) above will
be no less favourable (on a best endeavours basis) to the licence holder than the
terms of the existing mining certifcates;
 (q)
    
    it is not aware of any facts which may render any of the Tenements liable to forfeiture;(r)
    
    no governmental or regulatory body has threatened to revoke any Tenement and there are no
governmental actions or proceedings, disputes, litigation, claims or causes of action in
existence or likely to arise in relation to the Tenements;(s)
    
    the Gladioli Companies are and will remain for the term of this Agreement the sole legal
holder of the Tenements and the Specified Assets (in each case free
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and clear of any liens, demands, claims or encumbrances or other interests in favour of
any person whatsoever);(t)
    
    Kalimantan Gold is and will remain the sole beneficial owner of the Bau Project free and
clear of any liens, demands, claims or encumbrances or other interests in favour of any
person whatsoever;(u)
    
    Gladioli is, and will immediately prior to Completion be, legally and beneficially entitled
to all of the issued share capital of Kalimantan Gold;(v)
    
    Kalimantan Gold has not traded and has no liabilities and will, at Completion, have no
liabilities (contingent or otherwise);(w)
    
    Kalimantan Gold has not entered into any contracts, arrangements or understandings with any
person and will not enter into any such contracts, arrangements or understandings prior to
Completion (other than this Agreement or contracts to be entered into pursuant to it);(x)
    
    Kalimantan Gold does not have and will not, at Completion, have any subsidiaries or
ownership interests in any company, joint venture or partnership;(y)
    
    Kalimantan Gold has not granted, and will not prior to Completion grant, any security
interests or other rights over or in respect of its assets and all of its assets are, and
will at Completion be, free from encumbrances;(z)
    
    the information in this Agreement (including in the background and in the appendices and
schedules) is true and correct in all respects;(aa)
    
    all information which has been given in writing by or on behalf of any Gladioli Company
(whether by any director, agent, professional advisor or other person) to BML or any
director, shareholder, agent, professional advisor or other representative of BML was, when
given, and is, true, complete and accurate in all material respects. Provided always that due
to the inherent nature of exploration and mining the interpretation of drilling results,
calculations of measured reserves and metallurgical studies or recoveries done by third party
consultants or other professional firms will always be subjective;(bb)
    
    it is not aware of any material circumstances or facts which have not been disclosed in
writing to BML or Zedex Minerals Limited prior to the date of this Agreement and which might
reasonably be expected materially and adversely to affect the Tenements or their
profitability, or which might otherwise be material to a purchaser of the Tenements or the
purchaser of an interest in the Bau Project;(cc)
    
    the Gladioli shareholder(s) who currently hold and who will hold a 45% interest in
Kalimantan Gold and in the Milling Company (once incorporated) following Completion will be
Bumiputera so that Kalimantan Gold and if relevant, the Milling Company will at and from
Completion comply with the
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FIC Guidelines regarding a minimum 30% effective voting interest held by
Bumiputeras;(dd)
    
    the Gladioli Companies have complied, in all respects, with all Environmental
Laws and are not required to pay any monies in respect of any Environmental Liability
relating to the Tenements which has not been disclosed in writing to BML or Zedex
Minerals Limited prior to the date hereof;(ee)
    
    all covenants, obligations and conditions attaching or related to the
Tenements have been disclosed to BML and have been complied with or performed and the
holder has the right to continued enjoyment of the Tenements; and(ff)
    
    save as expressly disclosed in the Tenements conditions or the Act or as
hereinafter provided, there are no governmental or other consents necessary for BML or
Kalimantan Gold or any other party to enter into and carry out its obligations under
this Agreement except for subsidiary applications under mining leases and mining
certificates necessary for geologists and others in carrying out field works and for
the necessary prior notice to be given to the District Office and to the nearest
police stations in respect of the areas targeted for Exploration or for a Project;(gg)
    
    save for the various tenements listed in Schedule A, it does not have any
direct or indirect legal, beneficial, or financial interest of any kind in any mining
tenements (or applications for mining tenements) in any part of Sarawak, Malaysia.
 3.2
    
    Each of the warranties in clause 3.1 is given as at the date of this Agreement and is deemed
to be repeated through to and at Completion with reference to the facts then existing and each
of the warranties is to be construed independently of the others and is not limited by
reference to any of the others.3.3
    
    The Gladioli Companies and the Gladioli Shareholders shall indemnify and keep BML indemnified
against all material loss, damage and costs suffered or incurred by BML by reason of the
warranties or representations contained in clause 3.1 proving to be incorrect.3.4
    
    The Gladioli Companies and the Gladioli Shareholders will immediately disclose to BML any
matter or thing which arises or becomes known to any of them prior to Completion which is
inconsistent with any of the warranties in clause 3.1 or which might render any of them
misleading or incorrect. BML may terminate this Agreement by notice in writing to the Gladioli
Companies given prior to Completion if any of the warranties in clause 3.1 is untrue or
inaccurate in any material respect.3.5
    
    The Gladioli Companies and the Gladioli Shareholders acknowledge that BML has entered into
this Agreement in reliance on the warranties in clause 3.1.3.6
    
    Each of the Gladioli Shareholders jointly and severally warrant and undertake to BML that
they have not granted any rights or other interests in, or created any encumbrances over,
their shares in the Gladioli Companies.
 17




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3.7
    
    The Gladioli Shareholders and the Gladioli Companies jointly and severally covenant and
agree with BML that:
 (a)
    
    none of the Gladioli Companies will issue any further shares or securities for
the term of this Agreement without first obtaining the consent in writing of BML, which
consent shall not be unreasonably withheld;(b)
    
    (where relevant (and except for any transmission of its shares as required by
law)) none of the Gladioli Shareholders shall transfer, create any trust in respect of
or otherwise deal in any way with their shares or securities of a Gladioli Company
without first obtaining the consent in writing of BML, which consent shall not be
unreasonably withheld; and(c)
    
    they will not do (or permit or allow to be done) anything whatsoever which will
cause or result in Kalimantan Gold or, from its incorporation, the Milling Company,
ceasing to meet the minimum Bumiputera shareholding requirements as
prescribed by the FIC guidelines and any conditions attached to the FIC consent(s).
 3.8
    
    Each of the Gladioli Shareholders severally covenants and agrees with BML that he will not at
any time whilst this Agreement remains in force exercise his voting rights in a Gladioli
Company, whether as a shareholder therein or a director thereof so as to cause or permit that
company to commit any breach of or fail to fulfill any obligation undertaken by it hereunder
or under any agreement to which it is a party and which is contemplated hereby. In addition,
each Gladioli Shareholder covenants to procure that each Gladioli Company complies with its
obligations under this Agreement.3.9
    
    Without limiting clause 3.3 above, the Gladioli Companies and the Gladioli
Shareholders shall indemnify and keep BML and Kalimantan Gold indemnified from and against all
loss (including loss of profits and lost opportunities), damage and costs suffered or incurred
by each of BML and Kalimantan Gold by reason of the mining leases referred to in Part A of
Schedule A not being current and in good standing and the Gladioli Companies not being able to
rectify any defects in such Tenements within 12 months of BML requesting that it do so.4.
    
    Covenants in Respect of the Tenements4.1
    
    Each of the Gladioli Companies covenants in respect of the Tenement or Tenements held by it
in favour of BML and Kalimantan Gold that at all times during the term of this Agreement:
 (a)
    
    it shall provide all such assistance as may be reasonably required by
Kalimantan Gold and the Manager to ensure that each of the Tenements shall at all
times be maintained in good standing and in full force and effect;(b)
    
    it shall do everything necessary to comply with the terms of the Tenements
and the Act and will not willfully do or neglect to do any act which may prejudice the
Tenements;
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(c)
    
    it shall procure that no mortgage, charge, or other encumbrance shall be granted
over any of the Tenements or the Specified Assets other than (1) as granted by or on
behalf of Kalimantan Gold pursuant to the Powers of Attorney or (2) where required by
law, direction, regulation, or other official requirement of the Sarawak or the
Federal Government;(d)
    
    it will not transfer, sell, assign or otherwise dispose of or attempt to
transfer, sell, assign or otherwise dispose of all or any interest in the Tenements or
the Specified Assets (including, for the avoidance of doubt, any interest in any land
forming part of the Exploration Area) other than (1) with the prior written consent of
Kalimantan Gold (which consent it may withhold in its absolute discretion), or (2) where
required by law, direction, regulation or other official requirement of the Sarawak or
the Federal Government. In the former case, it shall also procure that such assignee
shall covenant by deed to be bound by this Agreement as if named herein as a Gladioli
Company;(e)
    
    it shall assist Kalimantan Gold and the Manager with the renewal of the Expired
Licences, the renewals of the mining leases listed in Part A of Schedule A and the
renewals of the mining certificates listed in Part B of Schedule A and each Gladioli
Company covenants that exploration, drilling and mining operations on the Tenements will
not be affected by such renewal process;(f)
    
    it shall procure that all beneficial interest in the Tenements and the Specified
Assets remains vested in Kalimantan Gold at all times and (except as expressly permitted
pursuant to this Agreement) the Gladioli Companies shall not do anything with or in
relation to the Tenements and Specified Assets except with the prior written consent of
Kalimantan Gold as beneficial owner of the same;(g)
    
    it shall, immediately following formal issue of a Tenement in its name and
otherwise as and when requested by BML, execute a Power of Attorney in favour of
Kalimantan Gold in respect of each Tenement held by it and shall deliver such original
executed Power of Attorney to Kalimantan Gold for registration and shall execute such
other documents and do all such other things as may be required to ensure that such
Power of Attorney is registrable, valid and effective; and(h)
    
    it will not revoke, or purport or attempt to revoke, the Powers of
Attorney, or challenge in any way the validity or enforceability of any Power of
Attorney or any action taken by or on behalf of Kalimantan Gold pursuant to the
authority granted to it under the Powers of Attorney.
 4.2
    
    Each Gladioli Company agrees that it shall, if the law so permits, allow a caveat to be
lodged by Kalimantan Gold against its Tenements and title to land owned by it in the
Exploration Area.4.3
    
    Each of the Gladioli Shareholders and the Gladioli Companies agrees to indemnify and keep
indemnified each of BML, Kalimantan Gold, (from its incorporation) the Milling Company, and
their respective Affiliates from and against all liabilities
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(including Environmental Liabilities), losses, costs, expenses, claims, demands, and
proceedings of whatsoever nature which they may suffer or incur as a result of or in
connection with:
 (a)
    
    any act, omission, matter, or event occurring prior to the Completion Date in
connection with the Bau Project and/or the Tenements;(b)
    
    any activities undertaken on or adjacent to the Exploration Area prior to the
Completion Date (whether undertaken by a Gladioli Company, a Gladioli Shareholder, or a
third party);(c)
    
    any asset, structure (including, without limitation, any tailings dam) or
facility located on the Exploration Area as at the Completion Date.
 5.
    
    Payment of Back Rent5.1
    
    On Completion BML will (on behalf of Kalimantan Gold) (and Zedex shall procure that BML
will) reimburse Gladioli RM12,436 and pay RM828,046 to the relevant authorities being the
amount of back rent specified in Schedule G. Such funds shall be deemed to be a loan from BML
to Kalimantan Gold bearing interest at the Preference Share Rate and shall be deemed
Exploration Expenditure. For the avoidance of doubt, this loan from BML to Kalimantan Gold is
for paying the back rents to the Sarawak Government specified aforesaid and BML is not a
money lender nor in that line of business.6.
    
    Tenements6.1
    
    Each of the Gladioli Companies hereby irrevocably grants Kalimantan Gold the right to
explore, develop, and mine the Tenements.6.2
    
    Each party hereby covenants in favour of the other parties that at all times it shall refrain
from willfully doing any act or willfully failing to do any act which may endanger any of the
Tenements or render any of the Tenements liable for non-renewal.6.3
    
    Each party shall assist the other parties in maintaining the Tenements in good standing and
in seeking renewal thereof or replacement Tenements.6.4
    
    At the request of Kalimantan Gold, Gladioli shall, at its own cost, liaise with local and
central governmental and regulatory bodies to progress all matters relating to the Tenements
and all regulatory matters and issues affecting a Project or Kalimantan Gold. In addition,
Gladioli shall provide Kalimantan Gold, BML and, from its incorporation, the Milling Company
with all assistance and advice as they may reasonably request on matters of procedure and
protocol in Malaysia.6.5
    
    If approved by majority decision of the board of Kalimantan Gold, Kalimantan Gold (or a
Related Company nominated by Kalimantan Gold) may apply for and/or acquire mining tenement(s)
in addition to the Tenements. The Gladioli Companies and Gladioli Shareholders shall
provide Kalimantan Gold (or such Related
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Company) with all such assistance and advice as it may reasonably require in connection
with such application or acquisition.6.6
    
    Following the Completion Date none of the Gladioli Shareholders, the Gladioli Companies, BML,
or any Related Company or Affiliate of any of them (apart from Kalimantan Gold) shall make an
application for or acquire a mining tenement in Sarawak. Unless otherwise agreed in writing
by Gladioli and BML, all new applications for mining tenements or acquisitions of mining
tenements in Sarawak are to be made by Kalimantan Gold. Each of the Gladioli Shareholders, the
Gladioli Companies, and BML shall procure that their respective Related Companies and
Affiliates comply with this clause.6.7
    
    Clause 11.2 shall apply if a greater effective Bumiputera shareholding in Kalimantan Gold is
required in order for Kalimantan Gold to apply for and hold mining tenements.7.
    
    Security For Project Loan7.1
    
    At the completion of a Final Feasibility Study, to facilitate Zedex and BML obtaining the
finance necessary for the Project:
 (a)
    
    the parties shall procure that Kalimantan Gold shall offer its assets
(including any Tenements registered in its name) as security for a project loan to
develop and operate the Project;(b)
    
    the Gladioli Companies shall, subject only to any restrictions contained in
the Act and other government regulations, allow its Tenements which are the subject of
a Project to be used as security to finance a Project and shall execute all documents
and do all things required to perfect the security in favour of the financier(s).
 7.2
    
    Zedex warrants and undertakes that it will at all times provide all the necessary finance
including furnishing of corporate guarantees for BML to fulfill all its funding obligations
under this Agreement. In addition, Zedex shall indemnify Gladioli and Kalimantan Gold for all
losses and damages they suffer or incur as a result of any act, omission or default on the
part of BML where such acts, omissions or defaults of BML are tantamount to gross negligence
or willful misconduct.8.
    
    Non-Engagement In Other Business Activities8.1
    
    During the term of this Agreement none of the Gladioli Companies shall engage in any business
activities other than those the subject of this Agreement except that such restriction shall
not apply in relation to any area released under clause 21 or the quarrying operations
referred to in clause 40.9.
    
    Kalimantan Gold9.1
    
    The parties agree that Kalimantan Gold shall:
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(a)
    
    carry on the business of minerals exploration, mining and related activities in
the State of Sarawak, Malaysia;(b)
    
    carry on any other trade, or business whatsoever which can, in the opinion of
Kalimantan Gold, be advantageously or conveniently carried on by it by way of extension
of or in connection with the business referred to in (a) above, or which is calculated
directly or indirectly to develop any branch of its business or to increase the value
of or turn to account any of its assets, property or rights.
 9.2
    (a)
    
    As at the date of this Agreement, the authorized share capital of Kalimantan
Gold is divided into 100,000 shares of RM1.00 each. After signing this Agreement
the shareholders of Kalimantan Gold will immediately apply to the relevant
government agencies to change the shareholding structure into ordinary shares of
Class A and Class C and preferential shares of Class B and Class D. Gladioli will
have 45% of both Class A and Class B, and BML will have 55% of Class C and Class D.(b)
    
    Except for the matters provided in Schedule C and in Clause 14 the Class A
ordinary shares and the Class C ordinary shares shall rank pari passu in all
respects and the Class B and the Class D preference shares shall rank pari passu
in all respects.
 9.3
    
    Subject to the terms of this Agreement regarding the transfer and issue of shares, from
Completion the issued ordinary share capital in Kalimantan Gold shall be held as follows:Gladioli    1350 Class A ordinary shares of RM1.00 eachBML    1650 Class C ordinary shares of RM 1.00 each
 9.4
    
    Any subsequent increase in the issued capital of Kalimantan Gold shall be governed by the
provisions hereinafter contained.9.5
    
    If any conflict or inconsistency shall subsequently appear between the articles of
association of Kalimantan Gold for the time being in force and the provisions hereof, the
provisions of this Agreement shall govern rather than the provisions of such articles and any
such conflict or inconsistency shall be resolved by appropriate amendments of such articles,
which each of the parties hereby covenants to procure.9.6
    
    Kalimantan Gold shall comply with all conditions that may be imposed on it by the regulatory
authorities or legislation in Malaysia, including but not limited to the FIC, the Industrial
Co-ordination Act, 1975 or equivalent bodies or legislation.9.7
    
    The management and operation of Kalimantan Gold and the rights of Shareholders shall be as
attached as Schedules B and C.10.
    
    Completion
 10.1
    (a)
    
    On the Completion Date Gladioli and the Gladioli Shareholders shall procure the
adoption of the following shareholders resolutions of Kalimantan Gold:
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(i)
    
    The Memorandum and Articles are adopted as the memorandum and articles of
association of Kalimantan GoldSPECIAL RESOLUTION 1  MEMORANDUM AND ARTICLES OF ASSOCIATIONTHAT the Memorandum and Articles of Association attached hereto be approved and adopted as
the Memorandum and Articles of Association of the Company in substitution for, and to the
exclusion of the existing Memorandum and Articles of Association of the Company.(ii)
    
    Creation of New Classes of SharesSPECIAL RESOLUTION 2  INCREASE IN AUTHORISED SHARE CAPITALTHAT the authorised share capital of the Company be increased from RM100,000 to RM500,000 by
the creation of 125,000 Class A ordinary shares of RM1.00 each, 125,000 Class C ordinary
shares of RM1.00 each, 125,000 Class B preference shares of RM1.00 each and 125,000 Class
D preference shares of RM1.00 each ranking for dividend and in all other respects pari
passu with the existing shares in the Company except as expressly provided in the Articles
of Association of the Company.THAT the existing authorised capital of RM100,000 divided into 100,000 ordinary shares of
1.00 each be and are hereby classified as Class A ordinary shares and shall be included
among the 125,000 Class A ordinary shares.(iii)
    
    The appointments of the following Directors of Kalimantan Gold:ORDINARY RESOLUTION 1  APPOINTMENT OF DIRECTORS AND ALTERNATE DIRECTORTHAT Paul Seton, John Seton, Rod Murfitt, as nominees of Bau Mining Limited be and are hereby
appointed as directors of the Company with effect from the date of their respective
compliance with Section 123(4) of the Companies Act, 1965.THAT John Bin Jae be and is hereby appointed as Alternate Director to Ling Lee Kong with
effect from the date of his compliance with Section 123(4) of the Companies Act, 1965.THAT Tan Leng Choo @ Ivy Tan Ying Tong be and is hereby appointed as Alternate Director to
Ling Lee Soon with effect from the date of his compliance with Section 123(4) of the
Companies Act, 1965.
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(iv)
    
    Acceptance of Powers of Attorney from Gladioli Companies per Schedules
H and MORDINARY RESOLUTION 2  ACCEPTANCE OF POWERS OF ATTORNEYTHAT the Company accepts the Powers of Attorney to be given by the Gladioli Companies per
Schedule H of the Exploration and Shareholders Agreement dated 3 November 2006 between the
parties stated therein.THAT the Company accepts the Powers of Attorney to be given by the Gladioli Companies per
Schedule M of the Exploration and Shareholders Agreement dated 3 November 2006 between the
parties stated therein.(v)
    
    Issuance of Shares:ORDINARY RESOLUTION 3  ISSUANCE OF SHARESTHAT subject to the passing of Special Resolutions 1 and 2 above, the directors of the
Company be and are hereby authorised, pursuant to Section 132D of the Companies Act, 1965 to
issue 1348 Class A new ordinary shares of RM1.00 each and 1350 Class B preference shares
of RM1.00 each in the Company to Gladioli Enterprises Sdn. Bhd. fully paid and free and clear
of all encumbrances and other security or third party legal or equitable interests of any
kind.THAT subject to the passing of Special Resolution 1 above, the directors of the Company be
and are hereby authorised, pursuant to Section 132D of the Companies Act, 1965 to issue 1650
Class C new ordinary shares of RM1.00 each and 1650 Class D preference shares of RM1.00
each in the Company to Bau Mining Limited fully paid and free and clear of all encumbrances
and other security or third party legal or equitable interests of any kind.(vi)
    
    Transfer of SharesORDINARY RESOLUTION 4  TRANSFER OF SHARESTHAT the transfer of the two subscriber shares held by Ling Lee Soon and Tan Leng Choo @ Ivy
Tan Ying Tong to Gladioli be hereby approved.(vii)
    
    Appointment of Auditors for the Kalimantan Gold:ORDINARY RESOLUTION 5  APPOINTMENT OF AUDITORSTHAT Messrs Ernst & Young of Room 300-303, 3rd Floor, Wisma Bukit Mata Kuching,
Jalan Tunku Abdul Rahman, 93100 Kuching, Malaysia having consented in writing to act, be and
are hereby appointed auditors of the Company for the year ending/ended 31 March 2007 and that
authority be and is hereby given for the Directors to determine their remuneration.
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(viii)
    
    Appointment of Solicitors for Kalimantan Gold:ORDINARY RESOLUTION 6  APPOINTMENT OF SOLICITORSTHAT the appointment of Messrs Reddi & Co Advocates as the solicitors for
Kalimantan Gold be hereby approved.(ix)
    
    The approval by the shareholders of Kalimantan Gold to
accept the shareholder loan granted by BML to Kalimantan Gold;ORDINARY RESOLUTION 7  APPROVAL OF SHAREHOLDER LOANTHAT the shareholder loan of RM840,482 from Bau Mining Limited to the Company
for the payment of back rents to Sarawak Government specified in Schedule G
pursuant to Clause 5.1 of Exploration and Shareholders Agreement dated 3
November 2006 between the parties stated therein be hereby approved.THAT the Shareholders of the Company undertake to procure that the
above-mentioned Resolution is approved by the Board of Directors of the
Company.
 (b)
    
    On the Completion Date the Gladioli Companies shall deliver to BML:
 (i)
    
    the Powers of Attorney in the form attached as Schedule M duly
executed by each relevant Gladioli Company and in registrable form in respect
of those Tenements which have been validly and effectively issued as at the
Completion Date together with certified resolutions of each relevant Gladioli
Company approving the execution of such Powers of Attorney;(ii)
    
    the power of attorney in the form attached as Schedule H duly
executed by each Gladioli Company and in registrable form together with
certified copies of the resolutions of each Gladioli Company approving the
execution of each such power of attorney;(iii)
    
    a duly signed resignation from every director of Kalimantan Gold
(other than Mr Ling and the persons referred to in clause 10.1(a)(iii) above)
confirming that none of such persons have any claim against Kalimantan Gold in
respect of directors fees, reimbursement of expenses, remuneration or otherwise;(iv)
    
    duly executed and binding share transfers signed by the current
registered holders of the shares in Kalimantan Gold in favour of Gladioli.
 10.2
    (a)
    
    On the Completion Date, subject to Gladioli and the Gladioli
Shareholders complying with their obligations under 10.1 above and subject
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to BML being registered in the register of members of Kalimantan Gold as the
holder of the ordinary shares referred to in clause 10.1(a)(v) above and share
certificates being issued in the name of BML in respect of such shares, BML shall
three days after signing the said Exploration and Shareholders Agreement on
Completion Date furnish a copy of an irrevocable telegraphic transfer from the
bank of BML or Zedex of a non-refundable, unconditional payment of US$400,000
(United States Dollars Four Hundred Thousand Only) or equivalent to Singapore
currency ruling at the Completion Date to Mr Ling duly authorised to receive the
payment and acting on behalf of the Gladioli Shareholders. Mr Lings bank account
number is (A/C: 01 08510301) with the Standard Chartered Bank, 6 Battery Road,
Singapore.(b)
    
    The balance of US$250,000 (United States Dollars Two Hundred And Fifty
Thousand) shall be paid to Mr Ling Lee Soon upon proof of the receipt from the
Department of the Lands and Surveys, Kuching on the new applications of GPLs by
Gladioli over areas as shown on the maps marked and supplied by Zedex/BML within the
next ten days. Furthermore, Gladioli will endeavour best to get renewals of
exploration licences at the best terms possible at the earliest time frame.
 10.3
    
    Subject to clause 16.2, the payment referred to in clause 10.2, together with the payment of
US$350,000 already made by on behalf of BML shall constitute the entire consideration payable
by BML for its 55% effective economic interest in the Bau Project.11.
    
    FIC Consent11.1
    
    BML shall furnish Gladioli with its company brochures, data, financial reports and all other
necessary information required for making an application for the joint venture arising out of
this Agreement to the FIC within two weeks from Completion. Upon receiving such information
Gladioli shall immediately file the said application forms and information with FIC and shall
pursue such application with due diligence. The Gladioli Companies covenant in favour of BML
and Kalimantan Gold that they will obtain the said approval (without conditions attached or
with conditions acceptable to BML in its absolute discretion) from FIC within one year from
the Completion Date and if such consent is not obtained or if it is obtained but with
conditions attached, the Gladioli Companies and the Gladioli Shareholders shall
indemnify and keep indemnified BML from and against all losses, costs, expenses and
liabilities suffered or incurred by BML as a result of the failure to obtain such
unconditional FIC consent.11.2
    
    If the FIC requires a greater effective interest in Kalimantan Gold to be held by Bumiputera
than that held immediately following Completion, the Bumiputera shareholding in Gladioli
shall be increased (or, if acceptable to BML, part of Gladiolis shareholding in Kalimantan
Gold will be transferred to a person who is Bumiputera) to ensure that Kalimantan Gold
complies with the minimum Bumiputera shareholding requirements imposed or required by the FIC.11.3
    
    The covering letter accompanying the application to the FIC shall be substantially in the
form attached as Schedule L as may be amended with the written consent of BML.
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12.
    
    Exploration12.1
    
    Kalimantan Gold will (and Gladioli, Zedex and BML shall procure that Kalimantan Gold
will):
 (a)
    
    Undertake the Initial Exploration Programme for the twelve months following
Completion. Kalimantan Gold shall incur minimum expenditure in connection with the
Initial Exploration Programme as follows:
 (i)
    
    US$200,000 by six months after the Completion Date;(ii)
    
    A further US$500,000 by twelve months after the Completion
Date; and(iii)
    
    A further US$300,000 by eighteen months after the Completion
Date or such reasonable amount acceptable to Kalimantan Gold to be spent
yearly as required by the government under the prospecting licenses in view of
the size of the area covered under such licenses.
 Any excess expenditure in one of the aforementioned periods can be credited against
expenditure required in any subsequent period(s).(b)
    
    Subject to BMLs technical review indicating it is warranted, conduct a
feasibility study on the Jugan project as soon as possible
following Completion. For the avoidance of doubt, any expenditure incurred in
connection with such a feasibility study shall count towards the minimum expenditure
commitments set out in 12.1(a) above.(c)
    
    Within three months prior to the anniversary of the Completion Date (and each
anniversary thereafter) prepare an Exploration Programme for the following twelve
months. Each Exploration Programme must be in accordance with accepted mining
industry standards and calculated to ensure orderly progress of the Exploration and
shall be in accordance with all governmental requirements or directives.(d)
    
    Subject to Kalimantan Gold obtaining any necessary governmental approvals in
respect of the work contemplated by the Exploration Programme, or any variation
thereof, Kalimantan Gold shall conduct the Exploration Programme.(e)
    
    On request, provide Gladioli with reasonable access to all Information and
all related and other information, papers and documents pertaining to Exploration
and/or Exploration Expenditure during the preceding calendar month provided that
complying with such requests do not consume unnecessary management time of Kalimantan
Gold or BML. Gladioli shall treat all such Information as strictly confidential in
accordance with clause 28.(f)
    
    Notwithstanding anything else contained herein Kalimantan Gold shall ensure
that all Exploration and other activities carried out under this Agreement shall be
conducted so as to ensure that the minimum expenditure requirements
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applicable to the Tenements are complied with unless and to the extent that
appropriate exemptions, amendments or waivers of such requirements are granted or
extensions of time to comply with such requirements are granted by the Sarawak
Government.(g)
    
    On reasonable request, conduct a meeting either in Kalimantan Golds office
or Gladiolis office to brief Gladioli and BML on the current status of the
Exploration, including a summary of work done, new data obtained, sample assay
results and the interpretation thereof. Kalimantan Gold is not obliged to conduct
such meetings more regularly than once every two months.(h)
    
    Permit Gladioli and BML to take portions of samples, in such amounts and of
such nature and in such manner as may be reasonably required.(i)
    
    Allow any representative of Gladioli or BML to enter the sample core house or
any building(s) which store(s) the reverse circulation drilling chip samples or
diamond drilling core samples, and to inspect those samples at any time during office
hours, provided reasonable notice is given to Kalimantan Gold and such inspections do
not take place more frequently than monthly.
 12.2
    
    Subject to the Manager obtaining any necessary governmental approvals, the Manager may vary
the Exploration Programme from time to time during a month in light of the progressive results
of Exploration provided that such variation (together with any previous variations made to the
Exploration Programme since it was last approved by the board of Kalimantan Gold) does not
increase expenditure under the Exploration Programme by more than 10 percent from the
expenditure outlined in the Exploration Programme as last approved by the board of Kalimantan
Gold. The Manager shall notify Gladioli and BML in writing of any such variation.12.3
    
    Each Exploration Programme shall be subject to review by the board of Kalimantan Gold at
least once during each period of three calendar months beginning on the date that such
Exploration Programme is approved by the board of Kalimantan Gold.12.4
    
    Exploration Expenditure incurred by Kalimantan Gold shall be contributed by BML in the manner
set out in Clause 13.12.5
    
    Notwithstanding anything hereinbefore or hereinafter provided, the Manager may exceed any
approved budget by up to 10% in the event of an emergency, but as soon as practicable
thereafter the Manager shall notify and justify its decision to the board of directors of
Kalimantan Gold.12.6
    
    The amount spent by BML and Zedex Minerals Limited on consultants reports, technical
studies, sampling, and other such matters during its due diligence on the Bau Project shall be
deemed Exploration Expenditure funded by BML and shall count towards the Exploration
Expenditure commitments set out in clause 12.1(a)(i). For the avoidance of doubt, such
expenditure will be deemed to have been incurred on behalf of Kalimantan Gold and the amount
shall be a debt outstanding from Kalimantan Gold to BML which shall bear interest in the
manner provided in clause 5.
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12.7
    
    Unless otherwise agreed by Gladioli, BML shall procure that Kalimantan Gold incurs a
minimum of USD300,000 (United States Dollars Three Hundred Thousand) in Exploration
Expenditure during each complete calendar year following Completion. Subject to clause 12.8,
any failure on the part of Kalimantan Gold to incur such Exploration Expenditure shall be
deemed a default on the part of BML and Gladioli shall be entitled at any time within 3
months following the end of the calendar year in which Exploration Expenditure incurred
by Kalimantan Gold is less than the aforementioned amount to require Zedex, BML and
Kalimantan Gold to effect Withdrawal from this Agreement, by giving to Zedex, BML and
Kalimantan Gold 30 days written notice thereof.12.8
    
    Gladiolis right to require Zedex, BML and Kalimantan Gold to effect Withdrawal under clause
12.7 shall not apply if Kalimantan Golds failure to incur the minimum Exploration Expenditure
is due to:
 (a)
    
    the failure of an A Director to approve Exploration Expenditure;(b)
    
    the failure of an A Director or a Gladioli Company to do any other act,
matter or thing reasonably required to be done by them in order to ensure that the
Exploration Expenditure commitments can be met;(c)
    
    a failure to obtain governmental approval for any Exploration which is not due
to the fault of BML or Kalimantan Gold; or(d)
    
    any event of force majeure as described in clause 27.
 13.
    
    Funding Of Exploration
 13.1
    (a)
    
    For the purpose of this Agreement, where the Exploration Programme indicates that funds
are required for Exploration Expenditure during any calendar quarter after Completion then,
to the extent that Kalimantan Gold does not have sufficient funds from prior subscriptions or
from its mining operations, such Exploration Expenditure shall be funded by BML and Gladioli
by way of subscription for preference shares. Each of BML and Gladioli will arrange for
Kalimantan Gold not later than the beginning of such calendar quarter to allot and issue such
further shares in accordance with Clause 13.1 (b) to provide the funds required for
Exploration Expenditure during such quarter. Each of BML and Gladioli shall sign all
documents and do all things required in order to approve the allotment and issue of
preference shares required to fund Exploration Expenditure. If for any reason the relevant
resolutions and approvals for the issue of any preference shares have not been signed or
obtained within 30 days of the funds being requested by Kalimantan Gold, BML may in its sole
discretion, lend Kalimantan Gold the subscription proceeds for the relevant preference share
issue. Any such loan shall bear interest at the Preference Share Rate.(b)
    
    During each such calendar quarter where funds are required for Exploration
Expenditure, shares shall be issued in lots of 100 comprising 55 Class D preference
shares which shall be allotted to BML and 45 Class B preference shares which shall
be allotted to Gladioli.
 29




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(c)
    
    Gladioli will to the maximum extent possible fund its subscription for
preference shares from its cash flow from 85% of dividends from Kalimantan Gold and
the Milling Company. To the extent such funding is unavailable or is inadequate, BML
will on each allotment of shares pursuant to Clause 13.1 (a), lend to Gladioli such
sum as may be necessary to enable Gladioli to pay for its allotments of Class B
preference shares. BML shall however pay such sums direct to Kalimantan Gold on
behalf of Gladioli. This loan from BML to Gladioli shall be interest-free and shall
only be repayable as set out in clause 13.2.(d)
    
    The preference shares allotted to BML and Gladioli will be issued at a premium
to par with such premium to be decided by Kalimantan Gold at the time of issue. Such
preference shares shall be redeemable out of cash flow and shall be redeemed in a 55:45
ratio in respect of Class D and Class B shares respectively.
 13.2
    
    Gladioli shall deposit the share certificates for its shares in Kalimantan Gold and the
Milling Company with BML whilst the loan referred to in clause 13.1 (c) remains unpaid. For
so long as any such loan remains outstanding Gladioli hereby irrevocably directs Kalimantan
Gold and the Milling Company to pay to BML 85% of any monies payable (including in respect of
Gladiolis dividends) by those companies to Gladioli.14.
    
    Preference Shares14.1
    
    The preference shares shall:
 (a)
    
    have the right to a preferential dividend which shall rank in priority to any
dividend payable on any other class of shares. The dividend shall accumulate to the
extent that there are insufficient distributable reserves to pay the dividend in any
year. Unless otherwise agreed, the cumulative dividend shall be 0% per annum in respect
of all the Class B preference shares and the Preference Share Rate in respect of the
Class D preference shares;(b)
    
    save as provided for under the Companies Act, 1965, have no right to vote;(c)
    
    be redeemable at the option of the Company.
 14.2
    
    Subject to sufficient distributable reserves being available the dividend payable on the
preference shares shall be payable in respect of each financial year (or part thereof) within
3 months of the end of each financial year.15.
    
    Right Of Access To The Exploration Area15.1
    
    For the purposes of carrying out its obligations and of exercising its rights hereunder,
the Gladioli Companies hereby irrevocably grant Kalimantan Gold and, from its incorporation,
the Milling Company, the right (which shall be an exclusive right, subject only to the rights
of any Gladioli Company in relation to any area released under Clause 21 and in relation to
any exclusion under Clause 40) by its agents (including, for the avoidance of doubt, the
Manager), servants, contractors or sub-
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contractors to do all things in relation to the Exploration Area which could be done by a
person legally and beneficially entitled to the Tenements, including, without limitation:
 (a)
    
    subject to Kalimantan Gold or the Milling Company (as relevant) ensuring that
all necessary permits or licenses are obtained, to enter thereon or any part or parts
thereof;(b)
    
    to do thereon and therein such things as shall be necessary to undertake
Exploration and to undertake each Project and to carry out its obligations hereunder;(c)
    
    to take therefrom and to deal with in any manner such ores, metals, minerals or
other products as it may consider reasonably necessary or desirable for the purposes of
evaluating the Tenements and the prospects thereof provided Kalimantan Gold shall not
take such ores, metals, minerals and other products outside Malaysia without permits
from the relevant government department(s) and further provided Kalimantan Gold shall
provide to Gladioli and BML an executive report of the status of operations on a
quarterly basis;(d)
    
    to take thereon and to use such plant, machinery, minerals, tools, implements
and other chattels and to erect thereon such buildings and structures as it shall
reasonably think fit; and(e)
    
    in the event of Withdrawal or Partial Withdrawal, Kalimantan Gold and the
Milling Company must not remove any fixed plant, minerals, building or structure
erected by them on the Exploration Area (or the Relevant Area, as the case may be)
unless otherwise agreed by Gladioli.
 15.2
    
    The Gladioli Companies and the Gladioli Shareholders covenant that the Specified Assets
including, for the avoidance of doubt, any land within the Exploration Area owned by any of
them (or any of their Related Companies or Affiliates) are made available to Kalimantan Gold
and, from its incorporation, the Milling Company free of charge for their use for Exploration
and for each Project.16.
    
    Decision To Develop16.1
    
    Kalimantan Gold will give notice to Gladioli and BML forthwith upon completion of a Final
Feasibility Study on the basis of which a Development Decision has been made, and shall
provide Gladioli and BML with a copy of the Final Feasibility Study.16.2
    
    Following a Development Decision being made in respect of the Jugan gold deposit, BML shall
(and Zedex shall procure that BML shall) make additional one-off payments to Gladioli as
follows (with such payments comprising part of the acquisition cost of BMLs interest in the
Bau Project):
 (a)
    
    US$500,001 (United States Dollars Five Hundred Thousand and One) upon the
Jugan gold deposit mine achieving 75% of the maximum rated capacity of the plant; and
 31




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(b)
    
    US$500,001 (United States Dollars Five Hundred Thousand and One) six months
after the Jugan gold deposit mine achieving 75% of the maximum rated capacity of
the plant (provided that such mine has operated continuously at or above such
capacity for such period).
 16.3
    
    As soon as possible following a Development Decision, Kalimantan Gold shall adopt a Project
Programme for the first 12 months of the relevant Project. Kalimantan Gold shall adopt an
updated Project Programme for the relevant Project for each following 12-month period not less
than 3 months prior to each anniversary of the Development Decision. The provisions of
sub-clauses 12.1(c), (d), (e), (f), 12.2, 12.3 and 12.5 shall apply to Development Expenditure
and each Project Programme in the same manner as they apply to Exploration Expenditure and
each Exploration Programme.16.4
    
    Kalimantan Gold and the Milling Company shall maintain in accordance with generally accepted
industry and accounting practice full and accurate records of transactions, inventories of ore
in process and in stockpile, stores, consumables, property and assets and accounts and records
of all payments and receipts and all charges and credits.16.5
    
    Each of Gladioli and BML through its servants, agents and auditors shall have the right at
all reasonable times and at its own risk and expense to inspect and observe the operations at
the Mine provided that the frequency or duration of such visits shall not unreasonably
interfere with the normal conduct of the operations at the Mine. All site rules and
regulations applying within or in respect of the Mine shall be complied with.16.6
    
    At the end of each financial year Kalimantan Gold and the Milling Company shall take a
physical inventory supervised by the auditors in accordance with generally accepted industry
practice or other means appropriate in the circumstances.16.7
    
    Upon a Development Decision being made BML shall, in its sole and absolute discretion, elect
for the Project to proceed on:
 (a)
    
    the basis that Kalimantan Gold will have sole economic and beneficial
ownership of the mined ore, in which case in consideration for the sum of RM10.00,
each Gladioli Company which holds the Tenement(s) in respect of which the
Development Decision is made shall irrevocably and unconditionally
assign to Kalimantan Gold all of their right, title, and interest in all mined ore,
minerals, and other products extracted from the Mine the subject of the Development
Decision such that Kalimantan Gold can deal with such ore as it sees fit and receive
all economic benefit in such ore. The Gladioli Companies and the Gladioli Shareholders
shall sign such documents and do all such other things as Kalimantan Gold and BML may
reasonably require to ensure that full economic and beneficial owenership to the ore,
minerals and other products are properly and effectively assigned to Kalimantan Gold;
or(b)
    
    the basis that title to the mined ore will remain with the relevant Gladioli
Companies, in which case the Project will proceed on the basis of the Development and
Mining Agreement and Ore Sale and Purchase Agreement structure.
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16.8
    
    Upon a Development Decision being made BML and Gladioli shall procure:
 (a)
    
    (if not already incorporated) the incorporation of the Milling Company and (if
not already the case) that the Milling Companys primary objects as stated in its
memorandum of association are as follows:
 (i)
    
    to develop and operate mills and associated facilities and to carry on
the business of purchaser and processor of gold bearing ores to produce and
sell gold dore and other minerals; and(ii)
    
    to carry on any other trade or business whatsoever as in the
opinion of the board of directors of the Milling Company, be advantageously or
conveniently carried on by it by way of extension of or in connection with, or
which is calculated directly or indirectly to develop any branch of its
business or to increase the value of or turn to account any of its assets,
property or rights;
 (b)
    
    (if not already the case) that the Milling Companys articles of association
are in identical form to those of Kalimantan Gold provided that if any conflict or
inconsistency shall subsequently appear between the articles of association for the
time being in force and the provisions of this Agreement, the provisions of this
Agreement shall govern rather than the provisions of such articles and any such
conflict or inconsistency shall be remedied by appropriate amendments of such articles,
which each of the Gladioli Companies, the Gladioli Shareholders and BML hereby
covenants to procure;(c)
    
    that the authorised capital of the Milling Company shall be at
least RM10,000,000 divided into 4,500,000 Class A ordinary shares and Class B
preference shares of RM1.00 each and 5,500,000 Class B ordinary shares and Class D
preference shares of RM1.00 each;(d)
    
    that the initial issued capital of the Milling Company shall be RM100 to be
subscribed or held by Gladioli and BML in 45:55 ratio either by Gladioli taking up A
ordinary shares at par and BML taking up C ordinary shares at par in the aforesaid
proportions and similarly, also in the same ratio of 45:55 for Gladioli taking up
Class B preference shares at premium to par and BML taking up Class D preference
shares at premium to par, or by appropriate transfer of shares between them at par.
The parties agree that at all times the issued share capital in the Milling Company
will be held as to 55% by BML and as to 45% by Gladioli unless otherwise agreed by BML
and Gladioli in writing;(e)
    
    that Kalimantan Gold and the Milling Company proceed with the Project (and
each of Gladioli and BML shall assist where possible);(f)
    
    Kalimantan Gold and the Milling Company apply for and obtain all such
additional permits, licenses, and consents necessary to undertake the Project. Such
permits, licenses, and consents shall be applied for in the name of Kalimantan Gold or
the Milling Company (as relevant) or, if such is not possible, by the relevant
Gladioli Company. If such permit, licence, or consent
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is obtained by a Gladioli Company it shall be considered a Tenement for the
purposes of this Agreement;(g)
    
    that, if clause 16.7(a) applies, the Milling Company and Kalimantan Gold enter
into an ore sale and purchase agreement pursuant to which the Milling Company shall
acquire the mined ore from Kalimantan Gold for the purpose of processing and on-sale.
The terms of such agreement shall be as agreed between Kalimantan Gold and the Milling
Company;(h)
    
    that, if clause 16.7(b) applies, Kalimantan Gold and the Gladioli Companies
who own the relevant Tenement(s) the subject of the Development Decision enter into a
Development and Mining Agreement and the Milling Company and the Gladioli Companies
who own the relevant Tenement(s) the subject of the Development Decision enter into an
Ore Sale and Purchase Agreement. Each of the Gladioli Companies hereby irrevocably
appoints each of BML and Kalimantan Gold (acting jointly and severally) as its
attorney to execute the Development and Mining Agreement and the Ore Sale and Purchase
Agreement on its behalf;(i)
    
    that the Milling Company shall forthwith apply to the Malaysian Industrial
Development Authority (MIDA) for the grant of pioneer status or Investment Tax
Allowance, whichever the Milling Company shall regard as preferable and more
beneficial in respect of the Project at the time of application (and each party shall
assist where possible); and(j)
    
    that the management and operation of the Milling Company and the rights of the
Shareholders shall be as that attached as Schedules B and C.
 16.9
    
    Clause 16.8 shall apply to any subsequent Development Decision, except that, unless otherwise
agreed between Gladioli and BML, a new Milling Company will not be incorporated and the
Milling Company incorporated in connection with the initial Project will be used for the
purposes of any subsequent Project.16.10
    
    Gladioli shall procure that the Gladioli Shareholders who will hold a 45% interest in the
Milling Company will be Bumiputera so that the Milling Company will at and from its
incorporation comply with the FIC Guidelines regarding a minimum 30% voting held by Bumiputera
or such higher requirement as may be a condition to the FIC consent. If necessary, the
Bumiputera shareholding in Gladioli will be increased or (if acceptable to BML) part of
Gladiolis shareholding in the Milling Company will be transferred to a Bumiputera to ensure
that the Milling Company complies with the minimum Bumiputera shareholding required by the
FIC.16.11
    
    The parties agree that if clause 16.7(b) applies and either the Development and Mining
Agreement or the Ore Sale and Purchase Agreement in the forms attached to this Agreement would
be (or would be at risk of being) void or voidable if executed, then those agreements will be
amended as may be required to ensure that they create valid and legally enforceable
obligations on the parties thereto, provided always that any such amendments do not adversely
impact the intended economic benefits of those agreements to Kalimantan Gold and the Milling
Company taken as a whole. The Gladioli Companies and the Gladioli Shareholders warrant and
undertake in favour of
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BML and Kalimantan Gold that they will not (and shall procure that their Affiliates and
Related Companies shall not) challenge the legality or enforceability of the Development
and Mining Agreement and/or the Ore Sale and Purchase Agreement. The Gladioli Companies and
the Gladioli Shareholders hereby indemnify each of BML, Kalimantan Gold and the Milling
Company from and against all losses (including loss of profits and lost opportunities),
damages, costs and liabilities that they may suffer or incur as a result of all or any part
of a Development and Mining Agreement and/or Ore Sale and Purchase Agreement being held
invalid, void or otherwise being successfully challenged. For the purposes of this
indemnity, 55% of any loss suffered by the Milling Company shall be deemed to be a loss
suffered by BML and BML shall be fully indemnified in respect of such loss under this
clause.16.12
    
    The Gladioli Companies and the Gladioli Shareholders acknowledge and agree that both Zedex
and BML would prefer for the Tenements the subject of a Project to be transferred to
Kalimantan Gold. For various reasons the Gladioli Companies are not amendable to this course
of action. Each of the Gladioli Companies and the Gladioli Shareholders hereby indemnify and
hold harmless each of BML and Kalimantan Gold from and against all losses (including lost
profits and revenues), costs, expenses, claims and liabilities that they suffer or incur as a
result of legal title to the relevant Tenements not being transferred to Kalimantan Gold
prior to commencement of a Project. For the purpose of this indemnity BML and Kalimantan Gold
shall be deemed to have suffered a loss to the extent that the aggregate economic benefits
accruing to each of them as a result of a Project are less than the aggregate benefits that
would have accrued to each of them had the Project proceeded on the basis that legal title to
the relevant Tenements was held by Kalimantan Gold.17.
    
    Withdrawal17.1
    
    BML shall only be entitled to effect Withdrawal after Kalimantan Gold has completed the
Initial Exploration Programme or spent a minimum of US$700,000 on Exploration Expenditure.
For the avoidance of doubt, the monies spent by BML and referred to in clause 12.6 shall count
towards such US$700,000 minimum expenditure.17.2
    
    Notwithstanding clause 17.1, BML shall be entitled to effect Withdrawal prior to completion
of the Initial Exploration Programme or Kalimantan Gold having incurred US$700,000 of
Exploration Expenditure if:
 (a)
    
    an event of force majeure as defined in clause 27 prevents the Initial
Exploration Programme from being completed or causes an unreasonable
delay in completing the Initial Exploration Programme;(b)
    
    results from the Initial Exploration Programme are such that a prudent
operator would be unlikely to proceed with the remainder of the Initial Exploration
Programme and/or incur any additional Exploration Expenditure;(c)
    
    BML reasonably believes that there are issues regarding the ability to secure
legal access to or to secure the necessary tenure over the relevant area.
 17.3
    
    Subject to clauses 17.1 and 17.2 but notwithstanding anything else contained herein, BML
shall be entitled to effect Withdrawal from this Agreement or any Partial
 35




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Withdrawal by BML giving Gladioli thirty (30) days notice in writing of its intention to
effect such withdrawal.18.
    
    Project Development
18.1 BML shall within the Finance Period:18.1
    
    BML shall within the Finance Period:
 (a)
    
    commit to provide; or(b)
    
    obtain a commitment from a reputable financial institution to provide;
 Kalimantan Gold and the Milling Company (as relevant) with the entire finance necessary
for the relevant Project. BML may satisfy this requirement by partially committing itself
and partially obtaining a commitment from a financial institution. Clause 7.1 shall apply
to any such Project finance. Any funds provided by BML or a related company of BML shall
be by way of loan to Kalimantan Gold or the Milling Company (as the case may be) and shall
carry interest at the greater of: (i) the rate charged by any third party provider of
funds to Kalimantan Gold or the Milling Company (as the case may be), and (ii) the
Interest Rate.19.
    
    Failure To Procure Finance19.1
    
    Subject to sub-clauses 19.2 and 19.3, if Zedex or BML fail to commit or obtain a commitment
in accordance with Clause 18.1, Gladioli shall be entitled at any time within 3 months from
the expiry of the Finance Period to require Zedex, BML and Kalimantan Gold to effect Partial
Withdrawal from this Agreement with respect to the Relevant Area, by giving to Zedex, BML and
Kalimantan Gold 30 days written notice thereof. Clause 27 shall not apply to this sub-clause.19.2
    
    Gladiolis right to require Zedex, BML and Kalimantan Gold to effect Partial Withdrawal shall
not apply if Zedex and BMLs failure to commit or obtain a commitment from a financial
institution in accordance with Clause 18.1 is due to:
 (a)
    
    the failure of an A Director to approve the borrowing;(b)
    
    the failure of any Gladioli Company to give any security as required by Clause 7.1(b);(c)
    
    the failure of an A Director or a Gladioli Company to do any other act,
matter or thing reasonably required to be done by them in order to secure the
necessary funding;(d)
    
    a failure to obtain governmental approval for the Project which is not due to
the fault of BML, Kalimantan Gold or the Milling Company; or(e)
    
    any unforeseen event or cause beyond the reasonable control of Zedex and BML,
including, without limitation:
 (i)
    
    a fall in the spot price of gold below US$400;
 36




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(ii)
    
    a need to undertake further geotechnical, geological or
metallurgical work;(iii)
    
    a failure to obtain government approvals;(iv)
    
    environmental or landholder difficulties; and(v)
    
    (if not expressly waived by BML in writing) an event of
force majeure (as defined in Clause 27).
 19.3
    
    BML, Zedex and Kalimantan Gold shall not be required to effect Partial Withdrawal if:
 (a)
    
    BML uses its reasonable endeavours to obtain funding for the relevant Project
pursuant to clause 18.1 but is unable to secure funding on terms reasonably acceptable
to it;(b)
    
    A prudent operator taking into account all relevant factors including, without
limitation, projected returns, risks and economic or political uncertainties, would be
unlikely to proceed with the relevant Project at such time.
 19.4
    
    Subject to Clauses 19.2 and 19.3, upon the expiry of the 30-day notice period provided in
sub-clause 19.1, BML and Kalimantan Gold shall effect Partial Withdrawal.20.
    
    Application of Surplus Funds20.1
    
    Unless otherwise agreed in writing by BML all surplus funds of each of Kalimantan Gold and
the Milling Company after (i) payment of expenses (including tax and interest on any loans
advanced by BML or a related company of BML) and (ii) other third party commitments
(including repayment to third party financiers in accordance with agreed repayment schedules)
and (iii) retention of such funds as the board of Kalimantan Gold or the Milling Company (as
relevant) may deem required for exploration, development and construction costs, shall be
applied as follows:
 (a)
    
    Firstly, by distribution of 15% of surplus funds available for distribution
to holders of ordinary shares in the manner contemplated in Schedule C;(b)
    
    Secondly, in payment of the principal amount of any loans advanced by BML or
a related company of BML to Kalimantan Gold or the Milling Company;(c)
    
    Thirdly, in payment of dividends on the preference shares held by BML;(d)
    
    Fourthly, in redemption of the preference shares issued by Kalimantan Gold or
the Milling Company;(e)
    
    Finally, as further distributions to holders of ordinary shares in the manner
contemplated in Schedule C.
 21.
    
    Release Of Tenements/ Disposal of Land
 37




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21.1
    
    If the board of Kalimantan Gold determines that any part of the Tenements is of
insufficient geological value to warrant further exploration thereon it shall within three
(3) months after making such determination, relinquish its rights with respect to such area
and shall be released from its obligations hereunder in respect of such part of the
Tenements consequent upon which Gladioli shall be free to deal with such part of the
Tenements as it deems fit whether by itself or in conjunction with any other party or
parties.21.2
    
    Any such relinquishment and release shall be accomplished by Kalimantan Gold giving notice
thereof in writing to Gladioli identifying the area in respect of which such notice is given
and discharging any caveats thereon. Thereafter, the relevant area which has been released
shall no longer be regarded as a Tenement under this Agreement and beneficial interest in such
area shall revert to the relevant Gladioli Company. Kalimantan Gold shall approve, sign and
file such documents as are required to remove the relinquished area from the ambit of the
Powers of Attorney.21.3
    
    In the event that the whole of the Exploration Area has been relinquished hereunder without
development of a Project on any part thereof, BML shall immediately effect Withdrawal.21.4
    
    The Gladioli Companies and the Gladioli Shareholders shall indemnify each of BML, Kalimantan
Gold and the Milling Company from and against all costs, liabilities (including Environmental
Liabilities), expenses, demands and losses that they may suffer or incur in connection with
any area relinquished or released pursuant to this clause 21 from the date on which written
notice of such relinquishment or release is given to Gladioli.22.
    
    Miscellaneous22.1
    
    The parties shall do everything necessary to maintain and protect the Tenements in good
standing in terms of the Act after Completion including the securing of any necessary labour
exemptions and the payment of rents, rates and other assessments levied under the Act or by a
municipal authority, and all parties shall assist in all respects and execute any documents
necessary to effect the purposes of this sub-clause.22.2
    
    Each party covenants in favour of each of the other parties (severally) that it shall not do
or omit to do anything knowingly whereby the right or interest of the Gladioli Companies to
keep the Tenements registered in their name may be lost, forfeited, surrendered, suspended or
otherwise prejudiced.22.3
    
    Each party covenants in favour of each of the other parties (severally) that it shall not do
or permit to be done by any other person any act, matter or thing which is within its
reasonable control which might imperil or endanger the title to the Tenements.22.4
    
    The provisions of Schedule B apply in respect of the management of Kalimantan Gold and the
Milling Company.22.5
    
    Kalimantan Gold will necessarily from time to time require the service and expertise of
Gladiolis Chief Geologist and General Manager for exploration and development,
 38




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##### 



government liaisons, goodwill activities, beyond the normal scope of obligations and the
duties of Gladioli to Kalimantan Gold. In recognition of such technical and managerial
involvement Kalimantan Gold shall pay Gladioli RM15,000 (Ringgit Fifteen Thousand only)
monthly, commencing one month after Completion. Such monthly fee shall be reviewed by BML
and Gladioli quarterly from the Completion Date and the monthly fee agreed by BML and
Gladioli at such quarterly review shall be the monthly fee payable during the quarter
following such review.23.
    
    Operations23.1
    
    Kalimantan Gold and, from its incorporation, the Milling Company shall (and Gladioli and
BML shall procure that Kalimantan Gold and, from its incorporation, the Milling Company
(where relevant), shall):
 (a)
    
    perform its obligations and conduct its operations in a good, workmanlike and
commercially reasonable manner and in accordance with good exploration, mining,
engineering, processing, milling, procurement and purchasing methods and practices and
with the standard of diligence and care normally exercised by qualified persons in the
performance of comparable work;(b)
    
    maintain true and correct books, accounts and records of its operations and
upon reasonable notice permit the examination and auditing and copying thereof by
Gladioli and BML at their expense;(c)
    
    where reasonably practicable, furnish all submissions and applications to any
governmental departments in respect of the Tenements to Gladioli for review and
comment;(d)
    
    comply with all statutes, regulations and other laws and the requirements of
any government department or inspector having jurisdiction concerning the Tenements
and the work involved in Exploration or operation of a Project;(e)
    
    make all regulatory filings by the dates prescribed by the relevant laws or
regulations;(f)
    
    maintain all necessary insurances in respect of workers compensation,
general public liability, common law risks and such other risks as are usual or as it
shall consider desirable for the protection of its assets and the parties hereto;(g)
    
    disclose immediately to Gladioli and BML any significant discovery of
mineralisation and provide it with a report thereon;(h)
    
    keep all documents, plans, samples and correspondence in good order;(i)
    
    at all times upon reasonable notice, provide the other parties with such
further information as may be reasonably required by them including but not limited
to full details and results of Exploration Expenditure and the operation of a Project
and such information as may be necessary to comply with any Stock Exchange reporting
obligations.
 39




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##### 



24.
    
    Warranty of Authority to Act24.1
    
    Each party represents and warrants to the others that:
 (a)
    
    it has full power and authority to enter into and perform this Agreement and
all the transactions contemplated herein, and that all corporate and other actions
required to authorise it to enter into and perform this Agreement and all transactions
contemplated herein have been or will be properly taken;(b)
    
    entry into or performance of this Agreement does not violate any other
contractual, legal or other obligations of it;(c)
    
    this Agreement when signed will have been duly executed by it and shall be
valid and binding on it in accordance with its terms.
 25.
    
    Training by BML25.1
    
    For so long as BML holds a majority interest in Kalimantan Gold and (from its incorporation)
the Milling Company BML shall use its best endeavours to train local professional staff and
technicians while transferring technology know-how to Kalimantan Gold and the Milling Company
to keep the cost of operation as low as reasonably practicable. All such technology know-how
shall remain the sole property of BML and shall only be used by Kalimantan Gold and, if
relevant, the Milling Company for the purpose of a Project. Kalimantan Gold and the Milling
Company shall cease to use any such know-how (and shall return to BML all written and other
records of such know-how) upon Withdrawal by BML.26.
    
    No Partnership26.1
    
    It is not the purpose or intention of this Agreement to create any mining partnership,
commercial partnership or other partnership relationship between the parties hereto. The
provisions of this Agreement and the rights, duties, obligations and liabilities of the
parties created and existing hereunder pertain exclusively to the subject matter of this
Agreement and to no other property or interest of the parties.27.
    
    Force Majeure27.1
    
    Notwithstanding anything herein contained, if any party is prevented from or interrupted in
carrying out any of its obligations hereunder by any event of force majeure (which shall mean
any action of Government; war (declared or not); blockade; revolution; terrorist attack;
insurrection; mobilisation; strike; lockout; civil commotion; riot; act of God; act of
enemies of Malaysia or Australia or New Zealand or Canada; plague or other epidemics; fire;
flood or any other cause or causes beyond the reasonable control of the party whether of the
kind enumerated above or otherwise), the party so affected may postpone its performance
hereunder during the continuance of such prevention, delay or interruption to the extent that
such prevention, delay or interruption affects such performance by giving notice to the other
parties of the occurrence of such event within two (2) weeks of its occurrence. The giving of
such notice shall operate to extend all time limits expressed in this
 40




---



##### 



Agreement by the duration of the event of force majeure. Written notice of the conclusion
of each such event shall be given forthwith.28.
    
    Confidentiality28.1
    
    The parties agree that all information, records, reports and other data as to the results of
Exploration, a Project, analysis, studies and operations hereunder and the Bau Project and
the joint venture shall be deemed confidential and shall not be divulged to other persons or
companies not a party to nor related to a party to this Agreement except as may be required
by law or a court of competent jurisdiction or any relevant securities exchange or regulatory
or governmental body to which the party is subject wherever situated provided that the
provisions of this clause shall not prevent BML or a related company of BML from making any
announcement to shareholders, the press, or a recognised stock exchange announcement,
consistent with normal practice or stock exchange rules concerning the progressive results of
Exploration, studies made under or pursuant to this Agreement and the operation of any
Project. BML shall, where reasonably practicable, give Gladioli 48 hours prior notice of any
announcement containing politically, socially or economically sensitive information and shall
take into consideration comments made by Gladioli on the same. Provided that this clause
shall not apply to:
 (a)
    
    Gladioli in the event of Withdrawal;(b)
    
    BML two years after the date of Withdrawal;(c)
    
    disclosure by Kalimantan Gold or BML of any such data, reports or
information to banks or other prospective funding providers in connection with seeking
funding for a Project;(d)
    
    an employee of the disclosing party participating in the project and then
only to the extent necessary for such person to carry out his/her duties;(e)
    
    independent consultants and contractors to the parties whose duties and
relations to Kalimantan Gold, the Milling Company or the joint venture reasonably
require such disclosure;(f)
    
    independent advisers engaged by a party for the purpose only of enabling such
advisers to give appropriate advice to the party in respect of matters arising under
this Agreement or any agreement contemplated under this Agreement;(g)
    
    any prospective purchaser or transferee or assignee of the whole or part of
any interest of BML or Gladioli in Kalimantan Gold, the Milling Company and the joint
venture and any advisers retained by such prospective purchaser, transferee or
assignee, subject to each of such persons entering into a confidentiality agreement
reasonably acceptable to both Gladioli and BML.
 28.2
    
    In making a disclosure or announcement no party shall attribute any statement to another
party without the consent in writing of the relevant party.
 41




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29.
    
    Governing Law29.1
    
    The Agreement shall be governed by and construed in accordance with the laws of Malaysia.30.
    
    Arbitration30.1
    
    If any controversy, claim or dispute arises out of or in relation to this Agreement
(including any question regarding the existence, validity or termination of this Agreement)
or with respect to any breach thereof, the parties hereto shall seek to solve the matter
amicably through discussions between the parties. Only if the parties hereto fail to resolve
such controversy, claim, dispute or breach within sixty (60) days by amicable arrangement
and compromise, any party may seek arbitration.31.
    
    Place And Mode Of Arbitration31.1
    
    Any such controversy, claim or dispute shall be finally settled by arbitration in Singapore.
 (a)
    
    The arbitration shall be conducted before three arbitrators in accordance
with the UNCITRAL Arbitration Rules then in effect. BML shall nominate one arbitrator
and Gladioli shall nominate a second arbitrator within thirty (30) days of the
notification of the request for arbitration by the aggrieved party. The two nominated
arbitrators shall decide upon the third arbitrator within thirty (30) days of the
appointment by BML or Gladioli of the second-in-time arbitrator.(b)
    
    The proceedings shall be conducted in English, and all arbitrators shall be
conversant with and have a thorough command of the English language and be familiar
with the operation of joint venture companies and the mining and metallurgy industry.(c)
    
    The parties shall be bound by the award rendered by the arbitrators and
judgment thereon may be entered in any court of competent jurisdiction.(d)
    
    Each party shall bear the costs of the arbitrator appointed by it and the
parties shall share the costs of the third arbitrator and the other costs of the
arbitration.
 32.
    
    Parties To Cooperate32.1
    
    The parties hereto shall respectively lend all the co-operation necessary for successful
Exploration and to enable the development of a Project and shall do or cause to be done all
acts and things to execute and deliver all documents necessary or advisable to carry out the
intent of this Agreement and shall be just and faithfully one to the other and will not do or
omit to be done anything whereby the interests of the undertaking as a whole are prejudiced.
Each of the parties hereto will execute and do and take such steps as for the time being lie
within its powers to procure that Kalimantan Gold, the Milling Company and all parties
referred to in this Agreement shall do, perform, comply with all such acts and things
contemplated under this Agreement and execute
 42




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all documents, deeds, release or assurances so that full effect may be given to this
Agreement.33.
    
    Costs33.1
    
    Each party shall bear its own costs (including solicitors costs) in relation to the
preparation and execution of this Agreement.33.2
    
    The stamp duty payable on the transfer(s) of shares from BML to Gladioli or its nominee
pursuant to Clauses 34.1 and 41.2 shall be borne by Gladioli.34.
    
    Final Cessation Of Operations34.1
    
    On the final cessation of operations in respect of the last Exploration and Project, and
following distribution of all surplus cash to Gladioli and BML in accordance with this
Agreement, BML shall if so required by Gladioli, transfer to Gladioli or its nominee all BMLs
shareholdings in Kalimantan Gold and the Milling Company for a consideration equal to its
share of the net assets of those companies.34.2
    
    BML shall execute and lodge with the solicitors to Kalimantan Gold a power of attorney
appointing Gladioli as BMLs attorney to do all acts and things as may reasonably be required
in connection with the winding up of Kalimantan Gold upon a Withdrawal. The solicitors to
Kalimantan Gold will be authorised to release such power of attorney to Gladioli if BML fails
to comply with its obligations under this Agreement in connection with a Withdrawal and does
not rectify such failure within 3 months of receipt of a written notice from Gladioli
requesting it to remedy such failure. Zedex shall furnish Gladioli a copy of the executed said
power of attorney with the format pre-agreed by Gladioli on Completion Date. The original copy
of the said power of attorney shall be enclosed in an envelope sealed and addressed to and
deposited with the Solicitors of Kalimantan Gold.35.
    
    Notices35.1
    
    All payments to be made to a party hereunder may (to the extent possible) be made and all
notices, offers, requests, consents, demands and other documents and communications required
or permitted to be given under this Agreement shall be in writing and may be addressed to a
party at the address set forth in Clause 35.2 or to such other address as that party may have
substituted therefore by notice in writing to the other parties, and shall be either
delivered personally or sent by facsimile transmission or by airmail, postage prepaid, and
shall be deemed to have been made or given in the case of hand delivery, upon delivery, in
the case of facsimile transmission, upon successful transmission and in the case of airmail,
on the seventh day after posting. The addressee shall in any case when requested by the
sender, promptly provide the sender by facsimile transmission acknowledgment of receipt, but
the delay or failure to give or receive any such acknowledgment will not affect the validity
of the communication in respect of which it sought. If the sender elects to serve any notice
or information by airmail it shall notify the receiver of that fact by facsimile at the time
of mailing.
 43




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35.2
    
    The addresses of the parties hereto shall, until substituted in accordance with Clause 35.1 be
as follows:
 Each of the Gladioli Shareholders
    
    Level 2and the Gladioli Companies
    
    Lots 9 and 10, Block H,Taman Sri Sarawak, Jalan Borneo, 93100KuchingSarawak, MalaysiaPh: +82 422 959Fax: +82 420 959BML and Zedex Minerals Limited
    
    Level 2Claymore House, 63 Fort Street, Auckland,New ZealandPh: +64 9 379 8787Fax: +64 9 379 8788Kalimantan Gold
    
    Level 2Lots 9 and 10, Block H,Taman Sri Sarawak, Jalan Borneo, 93100KuchingSarawak, MalaysiaPh: +82 422 959Fax: +82 420 959With a copy to Zedex at the address
above (or such other address as Zedex may
specify from time to time).
 36.
    
    Assignment and Delegation36.1
    
    Unless all other parties hereto consent in writing, a party may only assign its rights and
obligations hereunder as permitted by this Agreement or in conjunction with a transfer of its
shares in Kalimantan Gold and the Milling Company as permitted under Schedule C and clauses 37
and 38.36.2
    
    Gladioli and BML shall procure that Kalimantan Gold and, from its incorporation, the Milling
Company shall not, without the prior consent in writing of Gladioli and BML delegate all or
any part of its obligations or duties under this Agreement, except as authorised hereby.37.
    
    Preemptive Rights37.1
    
    In order to give further substance to the pre-emptive rights clauses of Schedule C hereto,
the parties confirm that any dealing (other than between related companies as permitted by
Schedule C) in the shares of a corporate shareholder of Kalimantan Gold or the Milling
Company (any dealing of the nature referred to being hereinafter referred to as an external
dealing) shall be subject to the same constraints as are imposed by those clauses on
dealings in the shares of those companies and accordingly before an external dealing is
undertaken, the shares which are the subject
 44




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thereof shall first be offered to the other shareholder or shareholders of Kalimantan Gold
or the Milling Company on no less favourable terms than are proposed in respect of the
external dealing, and, if accepted by the offeree, thereafter transferred to it.37.2
    
    The provisions of the pre-emptive rights clauses as to time period, valuations and otherwise
shall mutatis mutandis, apply in respect of any such offer.37.3
    
    Each party will ensure that any existing pre-emptive rights provisions affecting the shares
or any such corporate shareholder, whether contained in its articles of association or
otherwise, are modified appropriately to as to reflect the above intention.37.4
    
    Provided always that the provisions hereof shall not apply:
 (a)
    
    where the subject shares are transferred for the purpose of complying with the
requirement of the National Economic Policy of Malaysia or equivalent official policy
of the government of Malaysia for the time being;(b)
    
    to any dealings in shares in BML or Zedex Minerals Limited.
 38.
    
    Sale/Transfer of Shares38.1
    
    Neither Gladioli nor BML shall, without the prior written approval of the other, sell (or
agree to sell) any of its shares in Kalimantan Gold or in the Milling Company unless the
prospective purchaser thereof makes an offer to purchase all of Gladiolis and BMLs shares in
Kalimantan Gold and in the Milling Company on identical terms and conditions. However if the
price or the terms and conditions offered for the shares are not acceptable to either of those
parties, then the offer from the prospective purchaser cannot be accepted until the
pre-emptive rights provisions of the articles of Kalimantan Gold and the Milling Company (if
it is then in existence) have been complied with.38.2
    
    Notwithstanding anything else in this Agreement or the memorandum of articles of association
of Kalimantan Gold, Gladioli shall not, without the prior written consent of BML, sell,
transfer or otherwise dispose of its legal or beneficial interest in its shares in Kalimantan
Gold or, from its incorporation, the Milling Company to any person if, following such sale,
transfer or disposal, Kalimantan Gold or the Milling Company (as relevant) will cease to
comply with the minimum Bumiputera shareholding requirements as set out in the FIC
guidelines or the conditions to the FIC consent(s).38.3
    
    Notwithstanding any other provision of this Agreement, if any person(s) who in aggregate hold
more than 50% of the issued ordinary shares in Kalimantan Gold or the Milling Company wish to
sell all of their shares in such company to an unrelated third party transferee willing to
purchase all of the shares in such company, then the remaining shareholder(s) shall, at the
request of the proposing shareholder(s), sell all their shares in such company to such third
party if:
 (a)
    
    the price and terms of sale are identical for all shares to be sold and that
price is to be satisfied by cash and/or listed securities; and(b)
    
    the sale is on arms-length terms.
 45




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Any request made under this Clause 38.3 shall be in writing and shall specify the identify
of the proposed transferee, the material terms of the offer, and the completion date.38.4
    
    The parties to this Agreement shall do all things reasonably required to ensure that
Kalimantan Gold and the Milling Company (as relevant) continue to enjoy the rights afforded
to them under or pursuant to this Agreement following the transfer of the shares in
Kalimantan Gold and/or the Milling Company (as relevant) pursuant to Clause 38.3.39.
    
    Deed Of Assumption39.1
    
    Neither BML nor Gladioli shall assign, transfer or otherwise dispose of all or any part of
their shareholding from time to time in either Kalimantan Gold or the Milling Company or all
or any part of their interest under this Agreement unless they first procure the execution of
the transferee, assignee or disponee` of a deed binding on such party in a form acceptable to
the other parties hereto (acting reasonably) whereby the transferee, assignee or disponee
covenants and undertakes to be bound by and observe and perform the covenants on the part of
the assignor, transferor or disponor to the extent of the shareholding or interest acquired.40.
    
    Gladioli Quarry Areas40.1
    
    The areas where the Gladioli Companies have been working on production of limestone, marbles,
lime powder, overburden and calcium carbonates and other industrial minerals except gold shall
be subject to clauses 40.2 and 40.3.40.2
    
    Exploration and mining of gold and related activities (together Gold Mining Activities) by
or on behalf of Kalimantan Gold or the Milling Company on the Tenements is to take precedence
over all other activities on the Tenements. The Gladioli Companies may undertake other
mining activities in the areas referred to in clause 40.1 provided that such activities do not
prevent or obstruct the Gold Mining Activities. If Kalimantan Gold or the Milling Company
decides to explore and mine or utilise any area for Gold Mining Activities, the Gladioli
Companies shall cease all other activities on such area provided always that Kalimantan Gold
or the Milling Company (as relevant) shall use all reasonable endeavours to minimise
disruption to any pre-existing activities in the subject areas and shall use all reasonable
endeavours to undertake, as far as possible, a complementary mining scheme with the quarry
operators quarrying scheme.40.3
    
    If Kalimantan Gold reasonably believes that there are commercially viable gold deposits
within an area outside the Exploration Area in which a Gladioli Shareholder, a Gladioli
Company, or a Related Company of a Gladioli Company undertakes quarrying operations for
the production of limestone, marbles, lime powder, overburden, calcium carbonates,
or other industrial minerals, the Gladioli Companies and Gladioli Shareholders agree to (and
shall procure that any relevant third party shall) act in a co-operative manner to allow
Kalimantan Gold to apply for and obtain an exploration licence to explore for gold and other
precious minerals in such area and, if a Development Decision is made by Kalimantan Gold in
respect of such area,
 46




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to obtain a mining lease to mine for gold and other precious minerals in such area. If the
operations of Kalimantan Gold will impact on the relevant quarrying operations then
Kalimantan Gold and the relevant Gladioli Company shall negotiate in good faith to agree an
appropriate amount by which the Gladioli Company should be compensated for the adverse
impact on the quarrying operations. The provisions of Clause 40.2 shall apply in respect of
any such area the subject of this Clause.41.
    
    Default41.1
    
    Upon the happening of a Default Event, and throughout the period during which the
circumstances which gave rise to the Default Event remain unremedied:
 (a)
    
    the Defaulting Shareholder shall not be entitled to exercise any power, right
or privilege in respect of its shares in Kalimantan Gold and the Milling Company,
including (without limitation) any right or power to vote or any right or power to
appoint, remove or replace directors PROVIDED THAT nothing in this clause shall affect
any entitlement of the Defaulting Shareholder to be paid any dividend declared in
respect of its shares in such companies;(b)
    
    any director or chairman appointed by the Defaulting Shareholder shall not be
entitled to exercise any right or power to vote at meetings of the board of directors
of Kalimantan Gold or the Milling Company; and(c)
    
    unless otherwise required by applicable laws, all shareholder and board
decisions may be made by the Non-Defaulting Shareholder (or the directors appointed by
the Non-Defaulting Shareholder) notwithstanding anything to the contrary specified in
this Agreement or the constitution of the relevant Company;
 provided the Non-Defaulting Shareholder shall not be entitled to declare or pay a
dividend, redeem any redeemable preference shares or otherwise act in such a manner
which fundamentally alters the shareholding structure contemplated by this Agreement.41.2
    
    Upon the expiry of 30 days immediately following the happening of a Default Event, if the
circumstances which gave rise to the Default Event remain unremedied and BML is the
Non-Defaulting Shareholder, BML can (but is not obliged to) require Gladioli to purchase
BMLs shares in Kalimantan Gold and (if it has been incorporated) the Milling Company for
130% of their market value as agreed between the parties and, if no agreement as to the market
value of the shares is reached within 30 days of BML making such request, the market value
will be determined by an international accounting firm nominated by BML. The interest of BML
in Kalimantan Gold and, if incorporated, the Milling Company, shall be valued on a going
concern basis and on the basis that they will continue to enjoy the full rights to their
assets and the Tenements (and the assets and Tenements made available to such companies
pursuant to this Agreement or otherwise made available immediately prior to the Default Event)
for a minimum period of 20 years from the Default Event whether or not such is or is likely to
be the case. For the avoidance of doubt, Gladioli shall purchase BMLs shares in Kalimantan
Gold and (if it has been incorporated) the Milling Company for 130% of their market value as
determined by the nominated
 47




---



##### 



international accounting firm on the foregoing basis. The parties shall do everything
within their powers to effect the transfer of shares to Gladioli pursuant to this clause
41.2 and Gladioli shall pay to BML the agreed or determined consideration (plus all loans
and other amounts payable by Gladioli to BML) as soon as BML executes the necessary
transfer documentation notwithstanding that a third party approval may be required in
order to effect such transfer of shares.41.3
    
    The rights contained in this clause 41 shall be without prejudice to any other rights a
party may have in respect of a breach of this Agreement.42.
    
    Counterparts42.1
    
    This Agreement may be executed in one or more counterparts and by facsimile. Each
counterpart (including facsimile counterparts) shall be deemed an original, and all
counterparts together shall constitute one and the same Agreement.43.
    
    Partial Invalidity43.1
    
    If any provision of this Agreement or its application to any party or circumstance is or
becomes invalid, or is held to be illegal or unenforceable to any extent, the remainder of
this Agreement and its application will not be affected and will remain enforceable to the
greatest extent permitted by law.44.
    
    Specific Performance44.1
    
    BML shall be entitled to obtain an order for specific performance against any other party to
this Agreement defaulting in the performance of its respective obligations under this
Agreement. It is hereby expressly agreed that where the remedy of specific performance is
sought, an alternative remedy of monetary compensation shall not be regarded as compensation
or sufficient compensation for any partys default in the performance of the terms and
conditions herein.45.
    
    Other Business Opportunities45.1
    
    Except as provided in Clause 40 and as otherwise expressly provided in this Agreement, each
party will have the right to independently engage in, and receive full benefits from, business
activities, whether or not competitive with the operations of Kalimantan Gold and the Milling
Company, without consulting the other parties.46.
    
    Entire Agreement46.1
    
    This Agreement constitutes the entire Agreement between the parties with respect to its
subject matter and supercedes the Heads of Agreement between Zedex Minerals Limited and
Gladioli dated 26 June 2006.
 IN WITNESS
 48




---



##### 



THE COMMON SEALof GLADIOLI
    
    
    )ENTERPRISES SDN BHD
    
    
    )(Company No. 89270-K) was hereunto
    
    
    )affixed by authority of its Board of
    
    
    )directors in the presence of:
    
    
    )/s/ Tan Leng Choo @ Tan Ying Tong
    
    
    
    
    
    /s/ Ling Lee SoonDirector
    
    
    
    
    
    Director/SecretaryName (printed): TAN LENG CHOO
                           @ TAN YING TONG
    
    
    
    
    
    Name (printed): LING LEE SOON
 THE COMMON SEALof BUKIT
    
    
    )LINTANG ENTERPRISES SDN BHD
    
    
    )(Company No. 91725-H) was hereunto
    
    
    )affixed by authority of its
    
    
    )board of Directors in the presence of:
    
    
    )/s/ Tan Leng Choo @ Tan Ying Tong
    
    
    
    
    
    /s/ Ling Lee SoonDirector
    
    
    
    
    
    Director/SecretaryName (printed): TAN LENG CHOO
                           @ TAN YING TONG
    
    
    
    
    
    Name (printed): LING LEE SOON
 THE COMMON SEALof CARINO
    
    
    )SDN BHD(Company No. 100173-V)
    
    
    )was hereunto affixed by
    
    
    )authority of its board of Directors
    
    
    )in the presence of:
    
    
    )/s/ Tan Leng Choo @ Tan Ying Tong
    
    
    
    
    
    /s/ Ling Lee SoonDirector
    
    
    
    
    
    Director/SecretaryName (printed): TAN LENG CHOO
                           @ TAN YING TONG
    
    
    
    
    
    Name (printed): LING LEE SOON
 THE COMMON SEALof PRIORITY
    
    
    )TRADING SDN BHD
    
    
    )(Company No. 89740-K) was hereunto
    
    
    )affixed by authority of its board of
    
    
    )Directors in the presence of:
    
    
    )/s/ Tan Leng Choo @ Tan Ying Tong
    
    
    
    
    
    /s/ Ling Lee SoonDirector
    
    
    
    
    
    Director/SecretaryName (printed): TAN LENG CHOO
                           @ TAN YING TONG
    
    
    
    
    
    Name (printed): LING LEE SOON
 49




---



##### 



THE COMMON SEALof BUROI
    
    
    )MINING SDN BHD
    
    
    )(Company No. 35548-U) was hereunto
    
    
    )affixed by authority of its board of
    
    
    )Directors in the presence of:
    
    
    )/s/ Tan Leng Choo @ Tan Ying Tong
    
    
    
    
    
    /s/ Ling Lee SoonDirector
    
    
    
    
    
    Director/SecretaryName (printed): TAN LENG CHOO
                           @ TAN YING TONG
    
    
    
    
    
    Name (printed): LING LEE SOON
 THE COMMON SEALof GUNONG
    
    
    )WANG MINING SDN BHD
    
    
    )(Company No. 72530-H) was hereunto
    
    
    )affixed by authority of its board of
    
    
    )Directors in the presence of:
    
    
    )/s/ Tan Leng Choo @ Tan Ying Tong
    
    
    
    
    
    /s/ Ling Lee SoonDirector
    
    
    
    
    
    Director/SecretaryName (printed): TAN LENG CHOO
                           @ TAN YING TONG
    
    
    
    
    
    Name (printed): LING LEE SOON
 THE COMMON SEALof BUKIT
    
    
    )YOUNG GOLDMINE SDN BHD
    
    
    )(Company No.41863-X) was hereunto
    
    
    )affixed by authority of
its board of Directors in the presence of:
    
    
    ))/s/ Tan Leng Choo @ Tan Ying Tong
    
    
    
    
    
    /s/ Ling Lee SoonDirector
    
    
    
    
    
    Director/SecretaryName (printed): TAN LENG CHOO
                           @ TAN YING TONG
    
    
    
    
    
    Name (printed): LING LEE SOON
 50




---



##### 



SIGNEDon behalf of BAU MINING LIMITEDby two Directors:/s/ Paul F. Seton
    
    
    
    /s/ John SetonDirector
    
    
    
    Director/SecretaryName (printed): PAUL F. SETON
    
    
    
    Name (printed): JOHN SETON
 SIGNEDon behalf of ZEDEX MINERALS LIMITEDby two Directors:/s/ Paul F. Seton
    
    
    
    /s/ John SetonDirector
    
    
    
    Director/SecretaryName (printed): PAUL F. SETON
    
    
    
    Name (printed): JOHN SETON
 SIGNED, SEALEDand DELIVERED by
    
    
    )ALEXANDER LING LEE SOON
    
    
    )in the presence of:
    
    
    )/s/ Edmund Sun Kay Huat
    
    
    
    
    
    /s/ Ling Lee SoonWitnessName (printed): EDMUND SUN KAY HUAT
 SIGNED, by JOHN BIN JAIS@ JAEby
    
    
    )his attorney ALEXANDER LING LEE
    
    
    )SOONin the presence of:
    
    
    )/s/ Edmund Sun Kay Huat
    
    
    
    
    
    /s/ Ling Lee SoonWitnessName (printed): EDMUND SUN KAY HUAT
 SIGNED, by RICHARD HOU HEE
    
    
    )PHATby his attorney ALEXANDER
    
    
    )LING LEE SOONin the presence of:
    
    
    )/s/ Edmund Sun Kay Huat
    
    
    
    
    
    /s/ Ling Lee SoonWitnessName (printed): EDMUND SUN KAY HUAT
 51




---



##### 



THE COMMON SEAL of NATURAL
    
    
    )KALIMANTAN GOLD SDN BHD
    
    
    )(Company No. 666174-A)
    
    
    )was hereunto affixed by authority of its
    
    
    )board of Directors in the presence of:
    
    
    )/s/ Tan Leng Choo @ Tan Ying Tong
    
    
    
    
    
    /s/ Ling Lee SoonDirector
    
    
    
    
    
    Director/SecretaryName (printed): TAN LENG CHOO
                           @ TAN YING TONG
    
    
    
    
    
    Name (printed): LING LEE SOON
 52




---



##### 



SCHEDULE A
 List of Tenements
 PART A : MINING LEASES (MLs) GRANTED (MAP B & MAP C)
 COMPANY
    
    ML No.
    
    AREA (Ha)
    
    MINERALS TO MINE
    
    EXPIRY DATE
    
    REMARKSBukit Lintang Enterprises
Sdn. Bhd.
    
    ML 102
    
    
    41.7
    
    
    Gold
    
    11/06/2025
    
    Renewal granted on
07/07/2004.Priority Trading Sdn. Bhd.
    
    ML 108
    
    
    139.6
    
    
    Antimony/Silver/Gold//Calcium
    
    18/01/2023
    
    Renewal granted on
04/08/2004.Bukit Lintang Enterprises
Sdn. Bhd.
    
    ML 109
    
    
    12.735
    
    
    Antimony/Gold
    
    11/06/2025
    
    Renewal granted on
07/07/2004.Carino Sdn. Bhd.
    
    ML 115
    
    
    49.4
    
    
    Gold
    
    04/03/2024
    
    Renewal granted on
21/07/2004.Gladioli Enterprises Sdn.
Bhd.
    
    ML 117
    
    
    52.1
    
    
    Antimony/Silver/Gold/Calcium
    
    09/01/2025
    
    Renewal granted on
09/08/2004.Gladioli Enterprises Sdn. Bhd.
    
    ML 119
    
    
    5.281
    
    
    Antimony/Silver/Gold/Calcium
    
    23/05/2025
    
    Renewal granted on
09/08/2004.Bukit Lintang Enterprises
Sdn. Bhd.
    
    ML 121
    
    
    33.80
    
    
    Antimony/Gold
    
    11/06/2025
    
    Renewal granted on
07/07/2004.Bukit Lintang Enterprises
Sdn. Bhd.
    
    ML 122
    
    
    49.0934
    
    
    Antimony/Gold
    
    22/05/2025
    
    Renewal granted on
07/07/2004.Priority Trading Sdn. Bhd.
    
    ML 123
    
    
    2.6
    
    
    Antimony/Gold
    
    22/06/2024
    
    Renewal granted on
04/08/2004.Buroi Mining Sdn. Bhd.
    
    ML 125
    
    
    409.5
    
    
    Antimony/Silver/Gold/Calcium
    
    19/11/2025
    
    Renewal granted on
21/07/2004.Total Area (Ha)
    
    
    795.8094
 MINING LEASE (ML) UNDER RENEWAL
 APPLICATION (MAP C)
 COMPANY
    
    LICENSE NO.
    
    AREA (Ha)
    
    MINERALS TO MINE
    
    DATE ISSUED
    
    REMARKSGunong Wang Mining Sdn.
Bhd.
    
    ML 101
    
    
    67.18
    
    
    Gold/Antimony
    
    31/10/1999
    
    Under Renewal 


Application.Total Area (Ha)
    
    
    67.18
 53




---



##### 



PART B : MINING CERTIFICATES (MCs) GRANTED (MAP B & MAP D)
 COMPANY
    
    LICENSE NO.
    
    AREA (Ha)
    
    MINERALS TO MINE
    
    DATE ISSUED
    
    REMARKSGladioli
Enterprises Sdn.
Bhd.
    
    MC No. 
1D/1/1987
    
    
    194
    
    
    Antimony/Silver/Gold/Mercury
    
    12/01/1987
    
    GrantedGladioli
Enterprises Sdn.
Bhd.
    
    MC No. 1D/2/1987
    
    
    82
    
    
    Antimony/Silver/Gold
    
    13/07/1987
    
    GrantedGladioli
Enterprises Sdn.
Bhd.
    
    MC No. 1D/2/1987
    
    
    3,237
    
    
    Antimony/Silver/Gold
    
    13/07/1987
    
    GrantedGladioli
Enterprises Sdn.
Bhd.
    
    MC No. 1D/3/1987
    
    
    7,240
    
    
    Antimony/Silver/Gold
    
    01/08/1987
    
    GrantedGladioli
Enterprises Sdn.
Bhd.
    
    MC No. KD/01/1994
    
    
    1,694.86
    
    
    Antimony/Silver/Gold
    
    27/10/1994
    
    GrantedGladioli
Enterprises Sdn.
Bhd.
    
    MC No. SD/1/1987
    
    
    1,379
    
    
    Antimony/Silver/Gold
    
    13/07/1987
    
    GrantedTotal Area (Ha)
    
    
    13,826.86
 PART C: EXCLUSIVE PROSPECTING LICENSES (EPLS) & GENERAL PROSPECTING LICENSES (GPLs) UNDER RENEWAL APPLICATION) (MAP B & MAP D)
 COMPANY
    
    LICENSE NO.
    
    AREA (Ha)
    
    MINERALS TO MINE
    
    DATE ISSUED
    
    REMARKSGladioli
Enterprises Sdn.
Bhd.
    
    EPL Lot 1
    
    
    7,163
    
    
    Gold/Silver/Mercury/
Calcium
    
    12/05/1988
    
    Under Renewal
Application.Gladioli
Enterprises Sdn.
Bhd.
    
    EPL Lot 2
    
    
    1,210
    
    
    Gold/Silver/Mercury/
Calcium
    
    13/05/1988
    
    Under Renewal
Application.Gladioli
Enterprises Sdn.
Bhd.
    
    EPL Lot 3a
    
    
    1,038
    
    
    Gold/Silver/Mercury/
Calcium
    
    16/05/1988
    
    Under Renewal
Application.Gladioli
Enterprises Sdn.
Bhd.
    
    EPL Lot 3b
    
    
    3,817
    
    
    Gold/Silver/Mercury/
Calcium
    
    16/05/1988
    
    Under Renewal
Application.Gladioli
Enterprises Sdn.
Bhd.
    
    EPL Lot 4
    
    
    3,498
    
    
    Gold/Silver/Mercury/
Calcium
    
    16/05/1988
    
    Under Renewal
Application.Gladioli
Enterprises Sdn.
Bhd.
    
    EPL 337
 [Lot 5A]
    
    
    1,817
    
    
    Gold, Metals, Minerals
and Mineral oils
    
    15/12/1995
    
    Under Renewal
Application.Gladioli
Enterprises Sdn.
Bhd.
    
    EPL 337 [Lot 5B (1)]
    
    
    1,887
    
    
    Gold, Metals, Minerals
and Mineral oils
    
    15/12/1995
    
    Under Renewal
Application.Gladioli
Enterprises Sdn.
Bhd.
    
    EPL 338 
[Lot 6]
    
    
    1,247
    
    
    Gold/Silver/Antimony/Minerals and Mineral oils
    
    15/12/1995
    
    Under Renewal
Application.Gladioli
Enterprises Sdn.
Bhd.
    
    EPL 339
 [Lot 9]
    
    
    1,710
    
    
    Gold, Metals, Minerals
and Mineral oils
    
    15/12/1995
    
    Under Renewal
Application.Gladioli
Enterprises Sdn.
Bhd.
    
    EPL 340
 [Lot 7]
    
    
    927
    
    
    Gold, Metals, Minerals
and Mineral oils
    
    27/09/1996
    
    Under Renewal
Application.Gladioli
Enterprises Sdn.
Bhd.
    
    GPL No. 3/1992 a
    
    
    2,800
    
    
    Metal/Mineral
    
    26/08/1992
    
    Under Renewal
Application.Gladioli
Enterprises Sdn.
Bhd.
    
    GPL No. 3/1992 b
    
    
    5,700
    
    
    Metal/Mineral
    
    26/08/1992
    
    Under Renewal
Application.
 54




---



##### 



COMPANY
    
    LICENSE NO.
    
    AREA (Ha)
    
    MINERALS TO MINE
    
    DATE ISSUED
    
    REMARKSGladioli
Enterprises Sdn.
Bhd.
    
    GPL No. 4/1992
    
    
    4,061
    
    
    Metal/Mineral
    
    26/08/1992
    
    Under Renewal
Application.Gladioli
Enterprises Sdn.
Bhd.
    
    GPL No. 7/1995
    
    
    17,028
    
    
    Metal/Mineral
    
    10/11/1995
    
    Under Renewal
Application.Gladioli
Enterprises Sdn.
Bhd.
    
    GPL 4/1996
    
    
    986.80
    
    
    Metal/Mineral
    
    15/11/1996
    
    Under Renewal
Application.Gladioli
Enterprises Sdn.
Bhd.
    
    GPL 39/1997
    
    
    11,525
    
    
    Metal/Mineral
    
    22/08/1997
    
    Under Renewal
Application.Total Area (Ha)
    
    
    66,414.80
 EXCLUSIVE PROSPECTING LICENSE (EPL) UNDER APPLICATION (MAP D)
 COMPANY
    
    LICENSE NO.
    
    AREA (Ha)
    
    MINERALS TO MINE
    
    DATE ISSUED
    
    REMARKSGladioli
Enterprises Sdn.
Bhd.
    
    EPL Lot 8
    
    
    2,000
    
    
    n.a.
    
    n.a.
    
    Under ApplicationTotal Area (Ha)
    
    
    2,000
 GENERAL PROSPECTING LICENSE (GPL) UNDER NEW APPLICATION
(MAP E)
 Company:
 Tenement (Project) Name:
 Tenement No.:
 Total Area Applied (Ha):
 Application Date:
 Current Status:
 55




---



##### 



SCHEDULE A
 MAP A
 
 Location map showing the outlines of the Bau and Serian (Block C) tenements,
Sarawak, Malaysia
 56




---



##### 



MAP B
 
 Bau tenement location map showing MLs and MCs (shaded in green) and EPLs and GPLs (shaded
in purple)
 57




---



##### 



MAP C
 
 Bau Mining Leases (MLs shaded in green, MCs shaded in blue)
 
 58




---



##### 



MAP D
 
 Serian (Block C) tenements (MCs shaded in green, EPLs and GPLs shaded in blue)
 59




---



##### 



Map E: Gunung Rawan Block (new GPL application) in Serian District
 60




---



##### 



SCHEDULE B
 Management
 1.
    
    BML as Manager1.1
    
    BML is hereby appointed as the Manager with overall responsibility to manage and carry out
the operations of Kalimantan Gold and (from its incorporation) the Milling Company). BML
hereby agrees to serve as Manager until it resigns as provided in Section 4.1. The board of
each Company may appoint a replacement Manager on one months notice in writing to BML.2.
    
    Powers and Duties of Manager2.1
    
    Subject to the terms and provisions of this Agreement, the Manager will have the following
powers and duties, which will be discharged in accordance with approved Exploration
Programmes and Project Programmes and under the general guidance of the board of directors of
the Company:
 (a)
    
    the Manager will manage, direct and control operations of the Company;(b)
    
    the Manager will implement the decisions of the board of directors of the
Company and will make all expenditures on behalf of the Company necessary to carry out
the approved Exploration Programmes and Project Programmes, and will promptly advise
the board of the Company if it lacks sufficient funds to carry out operations;(c)
    
    the Manager will,
 (i)
    
    purchase or otherwise acquire, for and on behalf of the Company,
all material, supplies, equipment, water, utility and transportation services
required for its operations in accordance with an approved budget. Expenditure
which is more than 10% above the budgeted expenditure and which exceeds
RM10,000 (Malaysian Ringgit Ten Thousand) requires the prior approval of two of
the board of directors of Kalimantan Gold; and(ii)
    
    obtain such customary warranties and guarantees as are available
in connection with such purchases and acquisitions;
 (d)
    
    the Manager will conduct such title examinations and cure such title defects as
may be advisable in the reasonable judgment of the Manager;(e)
    
    the Manager will make or arrange for all payments on behalf of each Company
including, without limitation, all licence fees and rentals, all taxes, assessments and
other like charges;(f)
    
    if authorised by the board of the Company, the Manager will have the right,
acting on behalf of the Company, to contest in the courts or otherwise, the validity or
amount of any taxes, assessments or charges if the Manager deems them to be
 61




---



##### 



unlawful, unjust, inequitable or excessive, or to undertake such other steps or proceedings
as the Manager may deem reasonably necessary to secure a cancellation, reduction,
readjustment or equalization thereof before the Manager will be required to pay them;
 (g)
    
    the Manager will:
 (i)
    
    apply for all necessary permits, licenses and approvals on behalf and in the
name of the relevant Company,(ii)
    
    comply with applicable laws and regulations in all material respects,(iii)
    
    promptly notify the board of the Company of any allegations of any material
violation of applicable laws and regulations, and(iv)
    
    prepare and file, on behalf of the Company, all reports and notices required
under applicable laws and regulations.
 The Manager will not be in breach of this provision if a violation has occurred and the
Manager in a timely fashion takes such steps as might be available to remedy the violation
or to prevent its recurrence or disposes of the same through payment of fines or penalties
imposed in accordance with the law;(h)
    
    the Manager will prosecute and defend as it considers appropriate, but will not initiate
without consent of the board of the Company, all litigation or administrative proceedings
arising out of operations of the Company;(i)
    
    the Manager will obtain and maintain for and on behalf of the Company such insurance, with
such limits and deductibles, as would normally be maintained by a reasonably prudent operator
in the circumstances, either by way of a separate policy or the extension of coverage under a
blanket policy maintained by the Manager or an Affiliate of the Manager;(j)
    
    the Manager may with the prior approval of two of the directors of Kalimantan Gold (including
one Gladioli representative), on behalf of the Company, dispose of assets, whether by
abandonment, surrender or sale in the ordinary course of business, except that the Tenements
may not be sold, transferred or abandoned by the Manager except with the unanimous approval of
the board of directors of Kalimantan Gold;(k)
    
    the Manager will have the right to carry out its responsibilities hereunder through agents,
Affiliates or independent contractors;(1)
    
    the Manager will keep and maintain all required accounting and financial records for the
Company as required pursuant to Schedule C;(m)
    
    the Manager will comply with obligations imposed on it under Schedule C and shall otherwise
undertake its duties in compliance with the terms of this Agreement so that each party
benefits from the rights expressly conferred on it under this Agreement;
 62




---



##### 



(n)
    
    the Manager will undertake all other activities reasonably necessary to fulfil
the foregoing.
 2.2
    
    The Manager will not be in default of any duty under this section 2 if its failure to perform
results from the failure of one or more of the other parties to perform acts or to contribute
or pay amounts required of them by this Agreement or if any act or omission of the Manager is
done or omitted to be done at the direction or with the concurrence of the board of the
relevant Company.2.3
    
    The Manager has full power and authority to incur all Exploration Expenditure and Development
Expenditure on behalf of the Company in accordance with the Exploration Programmes and Project
Programmes.2.4
    
    The Manager has full power and authority to do all of the aforementioned acts and exercise
all of its powers on behalf of and in the name of the Company subject to any restrictions
which the board of directors of Kalimantan Gold may place on such powers from time to time.3.
    
    Standard of Care3.1
    
    The Manager will conduct all operations in a good, workmanlike and efficient manner, in
substantial accordance with sound mining and other applicable industry standards and
practices, and in substantial accordance with the terms and provisions of the Tenements,
leases, licenses, permits, contracts and other agreements pertaining to assets of the
Company. The Manager will not be liable to the other parties for breach of this Agreement or
any other act or omission, damage or loss unless the same constitutes the Managers willful
misconduct or gross negligence.4.
    
    Resignation4.1
    
    BML may resign as Manager upon one months prior notice to the other parties.5.
    
    Payments to Manager5.1
    
    Each month, the Manager will charge the Company a sum for each phase of operations as
provided below, which will be a liquidated amount to reimburse the Manager for its home office
overhead and general and administrative expenses to conduct each phase of the operations, and
which will be in lieu of any management fee:
 (i)
    
    Exploration Phase  ten percent (10%) of Allowable Costs.(ii)
    
    Major Construction Phase  two percent (2%) of the Allowable Costs.(iii)
    
    Mining Phase  three percent (3%) of Allowable Costs.
 The term Allowable Costs means all Exploration Expenditure and/or Development Expenditure
(as relevant) actually incurred, but excluding (1) the administrative charge payable to the
Manager; and (2) depreciation, depletion or amortization of tangible
 63




---



##### 



assets. The Manager will attribute such Allowable Costs to a particular phase of
operations by applying the following guidelines:
 (i)
    
    The Exploration Phase will cover those activities conducted to ascertain the
existence, location, extent or quantity of any deposit of ore or mineral. Such phase
shall cease when a Development Decision is made in respect of such deposit.(ii)
    
    The Major Construction Phase will cover those activities conducted to access
a commercially feasible ore body to extend production of an existing ore body, and to
construct or install related fixed assets, and will include all activities involved in
the construction of a mine, mill, smelter or other ore processing facilities.(iii)
    
    The Mining Phase will include all other activities not otherwise covered
above, including activities conducted after mining operations have ceased.
 5.2
    
    The Manager shall be entitled to reimbursement of all reasonable out-of-pocket expenses
incurred by it in the performance of its duties including, without limitation, reimbursement
of all travel and accommodation expenses. Such reimbursement shall be in addition to the
administration charge referred to above.6.
    
    Transactions with Affiliates6.1
    
    The Manager may engage Affiliates to provide services, supplies, equipment or machinery
hereunder, provided that it does so on terms no less favourable than would be obtainable from
unrelated persons in arms length transactions.7.
    
    Activities Absent Approved Plan and Budget7.1
    
    If the board of directors of a Company for any reason fails to adopt an Exploration
Programme or Project Programme then, subject to the contrary direction of the relevant board
of directors and to the receipt of necessary funds, the Manager will continue operations at
levels necessary to maintain and protect the assets and interests of the relevant Company and
to comply with all contractual and regulatory obligations related thereto. The parties will
be obliged to fund each Company in accordance with this Agreement until a new programme has
been adopted. For the purposes of determining the required funding, the last adopted
Exploration Programme or Project Programme (as relevant) will be deemed to have been
extended.8.
    
    Independent Contractor8.1
    
    The Manager is and shall act as an independent contractor and authorized agent of each
Company and not as an agent of the Shareholders. The Manager will maintain complete control
over its employees and all of its subcontractors with respect to performance of its duties.
Nothing contained in this agreement or any subcontract awarded by the Manager will create any
contractual relationship between any subcontractor and the other Shareholders. The Manager
will have complete control over and supervision of operations and will direct and supervise
the same so as to ensure their conformity with this Agreement.
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9.
    
    Indemnification of Manager9.1
    
    Kalimantan Gold will indemnify and save the Manager harmless from and against any and all
loss, liability, claim, demand, damage, expense, injury and death (including, without limiting
the generality of the foregoing, legal fees) (collectively the Loss) resulting from any acts
or omissions of the Manager or its operators, employees or agents. The Manager will not be
indemnified nor held harmless by Kalimantan Gold for any Loss resulting from the gross
negligence or willful misconduct of the Manager or its officers, employees or agents.
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SCHEDULE C
 1
    
    Board Of Directors1.1
    
    Except as otherwise required by mandatory provision of the laws of Malaysia and subject to
Schedule B, the overall responsibility for the management, direction and control of the
Company shall be vested in the board of directors (Board).
 1.2
    (a)
    
    Unless the Shareholders otherwise agree from time to time and subject to
paragraph (b) hereof, the holder of the majority of the A Class ordinary shares
in the Company shall be entitled to appoint two Directors (each director appointed
by the holder of the majority of the A Class ordinary shares shall hereinafter be
called an A Director) to the Board and the holder of the majority of the C
Class ordinary shares shall likewise be entitled to appoint three Directors (each
director appointed by the holder of the majority of the C Class ordinary shares
shall hereinafter be called a C Director).
 (b)
    
    In the event of a transfer of shares of one of the above-mentioned classes to
the holder of the shares of the other class, the shares transferred shall thereupon
become and thereafter be designated as shares of that other class. In the event that
the A Class ordinary shares become the majority of the issued shares of the Company
then such shares shall confer on the holder of the majority thereof the right to
appoint three A-Directors while the holder of the majority of the C Class ordinary
shares shall have the right to appoint two C-Directors. In the event that the C
Class ordinary shares become the majority of the issued shares of the Company then
such shares shall confer on the holder of the majority thereof the right to appoint
three C-Directors to the Board whilst the holder of the majority of the A Class
ordinary shares shall have the right to appoint two A-Directors to the Board.
 1.3
    
    The powers of the Shareholders to appoint Directors hereunder shall include the powers to fix
the period of their appointment and to remove a Director so appointed. Whenever a Director for
any reason whatsoever ceases to be a Director of the Company, the party which nominated such
Director shall be entitled to nominate another Director in his place.1.4
    
    The right of nomination, determination of period of office or removal of a Director pursuant
to this Clause shall be exercised by notice in writing signed by or on behalf of the party
entitled to exercise such right. Such notice shall be addressed to the Secretary for the time
being of the Company and such nomination, determination or removal shall take effect from the
date of receipt of such notice or on the date specified therein, whichever shall be later.1.5
    
    Any Director may from time to time appoint any person to be an Alternate Director of the
Company, and may at any time remove the Alternate Director so appointed by him from office.
 
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1.6
    
    The first Chairman of the Board shall be Paul Seton who is deemed appointed by the
holder of the majority of the A Class shares. The Chairman shall hold office for one year
following which a new Chairman shall be elected by the Directors from time to time on the
nomination of the holder of the majority of the C Class shares and each year thereafter a
new Chairman shall be appointed on the basis of a nomination made by the holder of a
majority of the A Class shares and the holder of the majority of the C Class shares on
an alternating basis. The Chairman shall automatically cease to hold such office if he
ceases for any reason to be a Director of the Company. The Chairman shall not have a second
or casting vote at any meeting of the Company or its directors.1.7
    
    Each of the Directors of the Company shall be given written notice of the time, date and
place of meetings of the Board at least seven (7) days prior to the date of convocation of
such meeting in each case; provided, however, that such period of notice may be shortened for
any particular meeting by the unanimous written consent of all the Directors in office. All
such notices shall be accompanied by a complete agenda for the meeting. All such notices and
agenda items shall be set forth in English. The quorum necessary for the transaction of
business at a meeting of the Board shall be three (3) Directors or their Alternates and
comprising at least one A-Director and one C-Director provided that if a quorum is not
present at any meeting, such meeting shall stand adjourned to the same time and place one (1)
week later and if a quorum is not present at the adjourned meeting then the Director or
Directors present shall constitute a quorum and may deal with the business for which such
meeting was convened.1.8
    
    Each Shareholder undertakes to vote, or to cause the Directors elected or appointed on its
nomination as the case may be, to vote or take such necessary actions as to give effect to and
implement the provisions of the Agreement to which this Schedule is attached.1.9
    
    The Board shall meet at least once every calendar quarter.1.10
    
    Unless otherwise stated in this Agreement, all decisions of the Board shall be made by
majority vote.1.11
    
    The Directors will not be entitled to any remuneration from the Company for the services they
perform in their role as Director.1.12
    
    All proceedings of the Board will be fully and accurately minuted in English and all meetings
of the Board shall be conducted in English.1.13
    
    The Board may take decisions without holding a meeting. A resolution in writing signed by all
members of the Board for the time being shall be as valid as if it had been duly passed
unanimously at a meeting of the Board duly convened and held. Any such resolution may consist
of several documents in like form, each duly signed by one or more members of the Board. Any
such document may be signed and sent by facsimile or other electronic means.1.14
    
    The members of the Board may meet by means of a telephone or other audio meeting provided
that the requisite Directors required to constitute a quorum are
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contemporaneously linked together by telephone or other audio means whereby all Directors
present can hear each other.2.
    
    Accounting/Financial Policies2.1
    
    The financial and accounting procedures of the Company to be implemented by the Manager are
set forth in this section 2. It is the intent of the parties that the Manager will not lose or
profit by its duties or responsibilities as Manager (other than by way of receipt of the
administration fee payable pursuant to Schedule B). The accounting policies and procedures set
out in this section 2 will be reviewed by the board of directors of the Company upon request
of the Manager to ensure that the Manager does not profit or suffer a loss from serving as a
manager. The board of directors of the Company will approve such modifications to these
accounting policies and procedures as are required to remedy any alleged unfairness or
inequity.2.2
    
    Unless otherwise agreed between Gladioli and BML the accounting period of the Company shall
run from 1st April one year to 31st March of the next year. The Manager will
maintain, for and on behalf of the Company, detailed and comprehensive cost
accounting records, prepared in accordance with these accounting procedures and policies
and IFRS, including general ledgers, supporting and subsidiary journals, invoices,
checks and other customary documentation, sufficient to provide a record of revenues and
expenditures and periodic statements of financial position and the result of operations for
managerial, tax, regulatory or other financial reporting purposes. Such records will be
retained for the duration of any period necessary to comply with tax or other regulatory
requirements. The records will reflect all obligations, advances and credits of the
Shareholders.2.3
    
    At the end of each of its accounting periods, the books of accounts and records of the
Company shall be audited by Messrs Ernst & Young. The auditors of the Company for the time
being are eligible for re-appointment at the annual general meeting of the Company. The
auditors of the Company for the time being shall prepare and supply to the Shareholders their
report on the financial accounts of the Company suitable for use by each in connection with
its financial and tax reports.2.4
    
    Subject to the following, as soon as possible after the close of each month but not later
than the 30th of the following month, the Manager shall, on behalf of the Company, submit to
each of the Shareholders a financial report, including actual performance against budget (and
explanation of major variances) in respect of such month and the accounting period to date.
The Manager shall, on behalf of the Company, provide to each of the Shareholders as soon as
possible after the close of each month sales, operations, production, marketing and personnel
reports in respect of such month. Until such time as a development Project has commenced the
Company will only be required to report in accordance with the foregoing on a quarterly basis
for each of the quarterly periods ending on 31 March, 30 June, 30 September and 31 December in
each year.Each Shareholder shall have the right to appoint its representatives during normal working
hours to check and verify any such reporting period.
 
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2.5
    
    The Manager shall ensure that the Company shall prepare its accounts in accordance with
IFRS and, to the extent that they are not inconsistent with IFRS, shall adopt the following
accounting policies:
 (a)
    
    All sales and revenues shall be brought to account in the accounting period in
which they arise.(b)
    
    Depreciation rates for fixed and other assets are to be established by the
approval of the Board.(c)
    
    All operating expenditure shall be expensed in the year it is incurred but the
Company shall be entitled to carry forward those expenses attributed to the subsequent
year or years.(d)
    
    All exploration, research and development costs shall be expensed in
accordance with the recommendation of the Companys auditors.(e)
    
    Pre-operational expenses shall be written off in the most tax-advantageous
manner.(f)
    
    Where there can be a doubt as to whether an expenditure should be capitalised
or expensed, a conservative approach is to be adopted.(g)
    
    Stocks are to be costed on a full average cost basis or the prevailing net
realisable value, whichever is the lower.(h)
    
    Where there can be a doubt as to the eventual marketability of stocks, or as
to the obsolescence of spare parts stocks, a conservative approach is to be adopted in
writing down or providing against the same.(i)
    
    A conservative approach is to be adopted where it is necessary to make
provisions against or for debts, claims or liabilities of the Company.
 2.6
    
    The Manager will maintain, in the name and on behalf of the Company, one or more separate
bank accounts for the payment of all expenses and the deposit of all cash receipts. Such
accounts will be interest bearing, if practical. All cheques of Kalimantan Gold will have two
signatories, one from Gladioli and the other from BML, subject to Gladioli having a signatory
available.2.7
    
    The financial affairs of the Company shall be managed on a commercial basis and be conducted
in accordance with the following policies:
 (a)
    
    The Company shall pay all ordinary and necessary liabilities incurred in the
operation of its business. The revenues from operations of the Company shall be
applied by the Company to pay such liabilities and:
 (i)
    
    to pay any and all Development Expenditure
and Exploration Expenditure;
 
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(ii)
    
    to pay capital expenditures and to establish appropriate reserves therefore;(iii)
    
    to repay Shareholder loans, redeem preference shares and pay dividends as
provided in Clause 20 of the Agreement;(iv)
    
    to make such other payments as may be directed from time to time by the
Board.
 (b)
    
    Surplus moneys not immediately required for the conduct of the Companys operations may be
invested by the Manager on behalf of the Company:
 (i)
    
    on deposit with any licensed bank, or(ii)
    
    in any other manner approved by the board of directors of the Company.
 (c)
    
    The Manager shall at all times take into consideration the policies of the Government of
Malaysia in the granting of the Tenements when entering into any business arrangement or
contract. In particular, but without limiting the generality of the foregoing the contract for
the construction of a Mill shall be made by way of open tender and the Manager shall endeavour
to use Malaysian contractors if such tenders are at competitive price terms and the services
and/or goods offered are of a quality comparable with tenders by foreign parties.(d)
    
    The Manager shall not take any of the following actions on behalf of the Company unless
approved by a resolution of the Board with at least one A-Director and one C-Director voting
in favour of the resolution relating to such business.
 (i)
    
    the exercise of any of the Companys borrowing powers (including the
establishment of any bank overdraft and the raising of any limit on such overdraft),
the exercise of any of the Companys powers to mortgage or charge its undertaking or
property or any part thereof or the exercise of any of the Companys powers to
guarantee any obligation of any third party provided that the A Director may not
unreasonably withhold an affirmative vote in respect of a Project financing proposal
put forward by the C Directors. The foregoing restriction does not apply to any loan
made by BML to the Company to fund Exploration Expenditure or finance a Project. Any
such loan need only be approved by simple majority of the Board with no requirement
for a Director of a particular class to vote in favour;(ii)
    
    the declaration of any dividend or other distribution (other than dividends
payable on the preference shares which shall be approved by a simple majority vote);(iii)
    
    the entry by the Company into any material long term contracts or
arrangements or any contracts or arrangements made otherwise than in
 
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the ordinary course of the Companys business or otherwise than on an arms
length basis, except, in each case, any contract required in order to
progress any Exploration or Project in the manner contemplated in the
relevant Exploration Programme or Project Programme;(iv)
    
    the incurring by the Company of any single item of capital
expenditure which has not been approved under the budget for such financial
year (as established by the Board of the Company) and which exceeds 20% of the
amount of capital expenditure contemplated in such approved budget;(v)
    
    any change in the accounting policies or practices of the
Company; and/or(vi)
    
    the entry by the Company into any joint venture or partnership
except, in each case, any joint venture or partnership required in order to
progress any Exploration or Project in the manner contemplated in the relevant
Exploration Programme or Project Programme.
 2.8
    
    The Manager shall use its best endeavours to obtain quotations locally within Malaysia for
all capital expenditures, purchase of consumable materials and disposal of assets where
transaction in each of such cases exceeds RM100,000.2.9
    
    For the purpose of this Agreement, the expression:debtshall mean all advances of loans (whether long or short term), sundry creditors,
trade creditors and other liabilities of the Company.equityshall mean the issued capital, share premium account, undistributed profits if any
(or less accumulated losses, if any, as the case may be) and any general reserves other than
arising from assets revaluation of the Company.2.10
    
    The Company is permitted to retain up to Ringgit Two Million (RM2,000,000) in retained
earnings and thereafter any further accumulation of retained earnings shall be up to ten
percent (10%) of its distributable profits of each year. Subject to the foregoing and
availability of tax credit and subject to the Board of directors of the Company determining
that a lesser amount of retained earnings shall be distributed, not less than ninety percent
(90%) of the distributable profits of the Company shall be available for distribution.2.11
    
    Notwithstanding anything contained in the preceding provisions of this Clause, the following
matters shall require the unanimous consent of the Directors or the Shareholders of the
Company for the time being:
 (a)
    
    any distribution of shares in the Company to the Shareholders arising from
capitalisation of share premium accounts;(b)
    
    any issuance of ordinary shares in the Company other than as contemplated by
this Agreement. For the avoidance of doubt, the issuance of preference shares
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during the Exploration phase and in accordance with an approved budget only
requires approval by simple majority vote of the Board and Shareholders.
 3.
    
    Shares3.1
    
    All shares to be issued by the Company hereafter shall be subject to the approval of the
meeting of Shareholders of the Company and in accordance with the applicable provisions of
the Companies Act 1965 (Companies Act). Neither of the Shareholders will vote at
such meetings against the passing of resolutions or proposals authorising the Company and the
Board to issue from time to time such numbers of shares as shall be necessary to enable the
implementation of the provisions of this Agreement.3.2
    
    Without the prior written consent of the other Shareholder or as otherwise provided in this
Agreement, no Shareholder shall transfer or otherwise dispose of its shareholdings now or
hereafter owned by it, or any rights or interests therein, to any person, firm, corporation or
other entity except in accordance with the following provisions of this Agreement.3.3
    
    Any of the Shareholders may assign and transfer the whole of its rights and obligations
under this Agreement and the whole of its shareholding in the Company to a corporation which
is an Affiliate or Related Company of such shareholder or, in the case of BML, a related body
corporate within the meaning of the Corporations Law of Australia, a related company as
defined in the New Zealand Companies Act 1993 or an affiliate as defined in the Canadian
Business Corporations Act but the transfer of such shares to any such company shall be subject
to approval being obtained from the relevant regulatory authorities in Malaysia, including but
not limited to FIC and to the transferor and the transferee first undertaking to the other
Shareholder that the transferee shall not cease to be an affiliate or related company of the
transferor without first transferring all the shares held by it in the Company back to the
transferor or to another affiliate or related company of the transferor.3.4
    
    Subject to the provisions of 3.3 above any Shareholder who wishes to transfer its
shareholding in the Company shall comply with the following:
 (a)
    
    Before transferring or requiring the Company to register a transfer of any
shares, the Shareholder proposing to transfer the same (hereinafter called the
proposing transferor) shall give a notice in writing (hereinafter called the transfer
notice) to the Company that it desires to transfer the same and the transfer notice
shall constitute the Company its agent for the sale of the shares therein mentioned at
the prescribed price to any Shareholder. A transfer notice once given shall not be
revocable except with the approval of the Board. Unless agreed in writing by the other
Shareholders, a transfer notice must be given in respect of all (and not some only) of
the proposing transferors shares in Kalimantan Gold and the Milling Company.(b)
    
    All shares included in any transfer notice shall be offered by the Company in
the first instance for sale at the prescribed price to the other Shareholders. All
offers of shares under this paragraph shall be made by writing sent through the post
in prepaid letters addressed or by facsimile transmission to the
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Shareholders at their respective registered addresses, and every such offer shall have a
time period of sixty (60) days within which the offer must be accepted or in default may
be treated as declined.
 Every such offer shall be capable of acceptance by the offeree or its nominee, (such nominee to
be, if Malaysian law or governmental policy so requires, a Malaysian citizen or corporation
qualified to accept and hold such shares).
 (c)
    
    If the Company within a period of sixty (60) days after receiving the transfer notice (or
such longer period as may be necessitated by the provisions of paragraphs (g) or (h) below)
shall find a Shareholder or nominee of a Shareholder (hereinafter called the purchaser)
willing to purchase the shares therein mentioned, the Company shall give notice in writing
thereof to the proposing transferor, and such transferor shall be bound, upon payment of the
prescribed price, to transfer the shares mentioned in the transfer notice to the purchaser
thereof.(d)
    
    Every notice by the Company under paragraph (c) stating that it has found a purchaser for the
shares shall state the name and address of the purchaser and the purchase shall be completed
at a place and time to be fixed by the Company, not being more than (30) days after the date
on which the prescribed price of those shares shall have been agreed or fixed as hereinafter
provided, unless the provisions contained in paragraph (h) shall apply.(e)
    
    If the proposing transferor, after having become bound to transfer shares to a purchaser,
shall make default in transferring the shares, the Company may transfer the shares to the
purchaser, and the Company may receive the purchase money, and shall thereupon cause the name
of the purchaser to be entered in the register as the holder of the shares, and shall hold the
purchase money in trust for the transferor. The receipt of the Company for the purchase moneys
shall be a good discharge to the purchaser, and he or it shall not be bound to see to the
application thereof, and after the name of the purchaser has been entered in the register in
purported exercise of the aforesaid powers the validity of the proceedings shall not be
questioned by any Shareholder.(f)
    
    If the Company shall not, within a period of sixty (60) days after receiving a transfer
notice (or such longer period as may be necessitated by the provisions of paragraphs (g) or
(h) below), find a Shareholder or nominee of a Shareholder desiring to purchase the shares
mentioned in the transfer notice, and has given notice in writing thereof to the proposing
transferor, or if the Company shall within the period aforesaid give to the proposing
transferor notice in writing that the Company has no prospect of finding purchasers of such
shares, the proposing transferor shall be at liberty to transfer the shares at any time within
one hundred and twenty (120) days after giving the transfer notice to any person or
company qualified under Malaysian law and governmental policy to accept and hold such
shares, at a price not being less than the price at which the shares were offered to the
Shareholder.(g)
    
    In this Clause the prescribed price means the sum per share specified in any transfer
notice as the sum which the proposing transferor giving the notice
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fixes as the fair value of the shares therein mentioned, unless the purchaser,
when agreeing to purchase the shares notifies the Company that he does not accept
such sum as the fair value of the shares, in which case, and also in any case where
the transfer notice does not specify any sum per share as the fair value of the
shares included therein, or is deemed to be given pursuant to any provision of
these presents, the prescribed price of the shares being purchased shall be the
fair value of the shares to be agreed between the proposing transferor and the
purchaser within fourteen (14) days after the name and address of the purchaser is
notified by the Company to the proposing transferor or, failing such agreement, the
fair value determined by an internationally recognised merchant bank nominated by
the Companys main banker. All costs incurred shall be borne equally by the
proposing transferor and the purchaser concerned. The merchant bank shall be acting
as an expert not as an arbitrator and the provisions of the Arbitration Act 2005
shall not apply.(h)
    
    Notwithstanding anything herein contained where the sale of any share shall be
subject to approval being obtained from the relevant regulatory authorities in
Malaysia, including but not limited to the FIC then completion of the sale of shares
shall be subject to such approvals being obtained.
 3.5
    
    If any Shareholder shall be adjudged bankrupt or a receiving order be made against him or it
or go into liquidation (other than for the purpose of amalgamation and reconstruction) his or
its trustee in bankruptcy or liquidator, as the case may be, shall be bound forthwith to give
to the Company a transfer notice as provided in 3.4 above in respect of all the shares
registered in the name of such Shareholder, and if no such transfer notice is given within one
(1) month of the bankruptcy, receivership or liquidation, the receiver, trustee in bankruptcy
or liquidator shall be deemed to have given such notice at the expiration of the said period
of one (1) month and the provisions of these presents shall have effect accordingly.3.6
    
    All restrictions on transfer of shares created hereby shall terminate on the occurrence of
any of the following events:
 (a)
    
    a single Shareholder becomes the holder of all the shares which are then
subject to this Agreement; or(b)
    
    the execution of a written instrument by the parties hereto which terminates
the same.
 3.7
    
    Notwithstanding anything hereinbefore contained, no transfer of any share to any person or
company who is not a party to this Agreement and to whom it is intended to be transferred
shall be registered unless such person or company shall first sign an agreement in a form
satisfactory to the Board whereby the terms and conditions of this Agreement (subject to such
amendments thereto as shall from time to time be in force) become binding upon and enforceable
by and against such person or company in all respects from the date of the transfer as if he
had been a party named herein and a signatory hereto originally.3.8
    
    Each ordinary share shall entitle the holder to one vote on any resolution of the
shareholders of the Company.
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4.
    
    Shareholders Meetings4.1
    
    Except as otherwise required by mandatory provisions of the Companies Act each Shareholder
shall be given notice of the time, date and place of general meetings of the Shareholders of
the Company at least twenty-one (21) days prior to the date of convocation of such meetings;
provided that such period of notice may be shortened for particular meetings with the
unanimous written consent of all the Shareholders. All such notices shall be accompanied by a
complete agenda for the meeting in each case and if possible the texts of resolutions proposed
to be adopted at such meetings.4.2
    
    Except as otherwise required by mandatory provisions of the Companies Act a quorum for a
general meeting of the Shareholders of the Company shall require the presence, in person or by
proxy of Shareholders of the Company holding more than seventy percent (70%) of the total
issued shares and entitled to vote thereat, and resolutions of general meetings of
Shareholders of the Company shall be adopted by affirmative vote as prescribed in the Articles
of Association of the Company or applicable provisions under the Companies Act Provided that,
if at any general meeting, a quorum as hereinbefore specified is not present, then the meeting
shall stand adjourned for one (1) week to the same time and place and, at the adjourned
meeting, the Shareholder or Shareholders present shall constitute a quorum.4.3
    
    Save as otherwise required by applicable laws or expressly stated in this Agreement, all
resolutions of Shareholders shall be effective and binding if passed by
Shareholder(s) holding more than 50% of the issued ordinary shares in the Company (or by the
representatives or proxies of such Shareholder(s)).5.
    
    General Meetings And Actions Requiring Shareholders Approval5.1
    
    General MeetingNotwithstanding anything in the Articles to the contrary, no business shall be transacted
at any general meeting of the Company unless a quorum of members is present throughout the
meeting.5.2
    
    Matters Requiring Special ResolutionThe Shareholders agree that none of the following actions of the Company shall be taken by
the Company unless approved by the Shareholders in general meeting by Special Resolution:
 (a)
    
    any amendment to any provision of the Memorandum and Articles of
Association of the Company;(b)
    
    the liquidation, dissolution, reorganisation or restructuring of the Company;(c)
    
    any increase of the authorised or issued ordinary share capital of the
Company or any grant of any option over the unissued share capital of the Company. For
the avoidance of doubt, the issue of preference shares only requires approval by
simple majority vote of the Shareholders;
 
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(d)
    
    any subscription by the Company for, or any purchase or acquisition by the Company of,
any shares, debentures, loan stock or other securities (or interest therein) whatsoever in,
or any acquisition of any business, undertaking or assets of, any other company or
unincorporated body;(e)
    
    the issuance by the Company of any debentures, loan stock or other form of security or the
granting of any options or other rights over any of the same;(f)
    
    any change in the auditors of the Company; and(g)
    
    any change in the financial year of the Company.
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SCHEDULE D
 Expired Licences
 CATEGORY 1 : MINING LEASE (ML) UNDER RENEWAL APPLICATION
 LICENSE
    
    AREA
    
    
    
    DATECOMPANY
    
    NO.
    
    (Ha)
    
    MINERALS TO MINE
    
    ISSUED
    
    REMARKSGunong Wang Mining Sdn. Bhd.
    
    ML 101
    
    
    67.18
    
    
    Gold/Antimony
    
    31/10/1999
    
    Under Renewal Application.Total Area (Ha)
    
    
    67.18
 CATEGORY 2 : EXCLUSIVE PROSPECTING LICENSES (EPLS) UNDER RENEWAL APPLICATION
 LICENSE
    
    AREA
    
    
    
    DATECOMPANY
    
    NO.
    
    (Ha)
    
    MINERALS TO MINE
    
    ISSUED
    
    REMARKSGladioli Enterprises Sdn. Bhd.
    
    EPL Lot 1
    
    
    7,163
    
    
    Gold/Silver/Mercury/ Calcium
    
    12/05/1988
    
    Under Renewal Application.Gladioli Enterprises Sdn. Bhd.
    
    EPL Lot 2
    
    
    1,210
    
    
    Gold/Silver/Mercury/ Calcium
    
    13/05/1988
    
    Under Renewal Application.Gladioli Enterprises Sdn. Bhd.
    
    EPL Lot 3a
    
    
    1,038
    
    
    Gold/Silver/Mercury/ Calcium
    
    16/05/1988
    
    Under Renewal Application.Gladioli Enterprises Sdn. Bhd.
    
    EPL Lot 3b
    
    
    3,817
    
    
    Gold/Silver/Mercury/ Calcium
    
    16/05/1988
    
    Under Renewal Application.Gladioli Enterprises Sdn. Bhd.
    
    EPL Lot 4
    
    
    3,498
    
    
    Gold/Silver/Mercury/ Calcium
    
    16/05/1988
    
    Under Renewal Application.Gladioli Enterprises Sdn. Bhd.
    
    EPL 337 [Lot 5A]
    
    
    1,817
    
    
    Gold, Metals, Minerals and Mineral oils
    
    15/12/1995
    
    Under Renewal Application.Gladioli Enterprises Sdn. Bhd.
    
    EPL 337 [Lot 5B (1)]
    
    
    1,887
    
    
    Gold, Metals, Minerals and Mineral oils
    
    15/12/1995
    
    Under Renewal Application.Gladioli Enterprises Sdn. Bhd.
    
    EPL 338 [Lot 6]
    
    
    1,247
    
    
    Gold/Silver/Antimony/ Minerals and
Mineral oils
    
    15/12/1995
    
    Under Renewal Application.Gladioli Enterprises Sdn. Bhd.
    
    EPL 339 [Lot 9]
    
    
    1,710
    
    
    Gold, Metals, Minerals and Mineral oils
    
    15/12/1995
    
    Under Renewal Application.Gladioli Enterprises Sdn. Bhd.
    
    EPL 340 [Lot 7]
    
    
    927
    
    
    Gold, Metals, Minerals and Mineral oils
    
    27/09/1996
    
    Under Renewal Application.Total Area (Ha)
    
    
    24,314
 77




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##### 



SCHEDULE E
 Initial Exploration Programme
 78




---



##### 



SCHEDULE F
 Share Capital of Gladioli Companies
 Gladioli Company
    
    Shareholder
    
    Shares HeldBukit Lintang Enterprises Sdn Bhd
    
    Ling Lee Soon
    
    
    52,500
    (21%)John Bin Jais @ Jae
    
    
    100,000
    (40%)Richard Hou Hee Phat
    
    
    97,500
    (39%)Buroi Mining Sdn Bhd
    
    Ling Lee Soon
    
    
    410,000
    (41%)John Bin Jais @ Jae
    
    
    300,000
    (30%)Richard Hou Hee Phat
    
    
    290,000
    (29%)Carino Sdn Bhd
    
    Ling Lee Soon
    
    
    699
    (69.9%)Ling Lee Kong
    
    
    1
    (0.1%)John Bin Jais @ Jae
    
    
    300
    (30%)Gladioli Enterprises Sdn Bhd
    
    Ling Lee Soon
    
    
    200,000
    (20%)John Bin Jais @ Jae
    
    
    400,000
    (40%)Richard Hou Hee Phat
    
    
    400,000
    (40%)Gunong Wang Mining Sdn Bhd
    
    Ling Lee Soon
    
    
    21,000
    (70%)John in Jais @ Jae
    
    
    9.000
    (30%)Priority Trading Sdn Bhd
    
    Ling Lee Soon
    
    
    210,000
    (70%)John in Jais @ Jae
    
    
    90,000
    (30%)Bukit Young Goldmine Sdn Bhd
    
    Ariffin Kusuma
    
    
    177,500
    (47.3%)John Bin Jais @ Jae
    
    
    112,500
    (30%)Ling Lee Soon
    
    
    85,000
    (22.7%)
 
 79




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##### 



SCHEDULE G
 Back-Rent Owed
 Mining Rent
    
    
    
    
    
    Total MiningAnnual

    
    Mining

    
    Overdue For 2002,
    
    
    
    
    
    Rent Overdue ForMining
    
    Rent
    
    2003, 2004, 2005 &
    
    Surcharge
    
    2002, 2003, 2004,1
    
    GLADIOLI ENTERPRISES SDN.BHD.
    ORIGINAL
    
    AREA AFTER
    
    EXPIRY
    
    Rent
    
    Paid
    
    2006
    
    10%
    
    2005 & 2006TENEMENT
    
    LOCALITY
    
    AREA (Ha)
    
    RENEWAL(Ha)
    
    DATE
    
    RM
    
    RM
    
    RM
    
    RM
    
    RMMC1D/1/1987
    
    Jugan Road/ Sirenggok Road/ Jambusan
Road/ Bau
    
    
    194.00
    
    
    
    N/A
    
    
    
    
    
    
    
    1,940.00
    
    
    
    
    
    
    
    9,700.00
    
    
    
    970.00
    
    
    
    10,670.00ML 117
    
    
    Bau District (Tai Parit & Arong Bakit)
    
    
    60.00
    
    
    
    52.10
    
    
    
    09.01.2025
    
    
    
    600.00
    
    
    
    3,000.00
    
    
    
    
    
    
    
    
    
    
    
    ML 119
    
    
    Bau District (Jugan)
    
    
    5.281
    
    
    
    5.281
    
    
    
    23.05.2025
    
    
    
    53.00
    
    
    
    265.00
    
    
    
    
    
    
    
    
    
    
    
    MC1D/2/1987
    
    Buso/Paku Road (Bau) & Subang
(Pedawan)
    
    
    3,319
    
    
    
    N/A
    
    
    
    
    
    
    
    33,190.00
    
    
    
    
    
    
    
    199,140.00
    
    
    
    19,914.00
    
    
    
    219,045.00MC1D/3/1987
    
    Bau/Krokong/Pangkalan Tebang
    
    
    7,240
    
    
    
    N/A
    
    
    
    
    
    
    
    72,400.00
    
    
    
    
    
    
    
    362,000.00
    
    
    
    36,200.00
    
    
    
    398,200.00MCSD/1/1987
    
    Tama/Tebakang/Tebedu Road/Serian
    
    
    1,379
    
    
    
    N/A
    
    
    
    
    
    
    
    13,790.00
    
    
    
    
    
    
    
    68,950.00
    
    
    
    6,895.00
    
    
    
    75,845.00MCKD/01/1994
    
    West
Pedi/Paku/Buso/Merembeh/Jambusan/
Sirenggok Area
    
    
    1,694.86
    
    
    
    N/A
    
    
    
    
    
    
    
    16,948.60
    
    
    
    
    
    
    
    84,743.00
    
    
    
    8,474.30
    
    
    
    93,217.30138,921.60
    
    
    
    3,265.00
    
    
    
    724,533.00
    
    
    
    72,453.30
    
    
    
    796,986.301
    
    
    Total Amount (RM): Mining Rent Paid and Mining Rent Overdue:
    
    
    800.251.30
 80




---



##### 



Mining Rent
    
    
    
    
    
    Total MiningAnnual
    
    Mining
    
    Overdue For 2002,
    
    
    
    
    
    Rent Overdue ForMining
    
    Rent
    
    2003, 2004, 2005 &
    
    Surcharge
    
    2002, 2003, 2004,2
    
    BUKIT LINTANG ENTERPRISES SDN.BHD.
    ORIGINAL
    
    AREA AFTER
    
    EXPIRY
    
    Rent
    
    Paid
    
    2006
    
    10%
    
    2005 & 2006TENEMENT
    
    LOCALITY
    
    AREA (Ha)
    
    RENEWAL(Ha)
    
    DATE
    
    RM
    
    RM
    
    RM
    
    RM
    
    RMML 102
    
    Bau District (Bukit Young mine site)
    
    
    41.70
    
    
    
    41.70
    
    
    
    11.06.2025
    
    
    
    417.00
    
    
    
    417.00
    
    
    
    1,668.00
    
    
    
    166.80
    
    
    
    1,834.80ML 109
    
    Bau District (Bekajang)
    
    
    12.735
    
    
    
    12.735
    
    
    
    11.06.2025
    
    
    
    127.35
    
    
    
    127.35
    
    
    
    509.40
    
    
    
    50.94
    
    
    
    560.34ML 121
    
    Bau District (Bidi Road)
    
    
    41.67
    
    
    
    33.80
    
    
    
    11.06.2025
    
    
    
    417.00
    
    
    
    1,668.00
    
    
    
    
    
    
    
    
    
    
    
    ML 122
    
    Bau District (Jambusan Road)
    
    
    50.90
    
    
    
    49.0934
    
    
    
    22.05.2025
    
    
    
    509.00
    
    
    
    2,036.00
    
    
    
    
    
    
    
    
    
    
    
    1,470.35
    
    
    
    5,174.35
    
    
    
    2,177.40
    
    
    
    217.74
    
    
    
    2,395.142
    
    
    Total Amount (RM): Mining Rent Paid and Mining Rent Overdue:
    
    
    7569.49Mining Rent
    
    
    
    
    
    Total MiningAnnual
    
    Mining
    
    Overdue For 2002,
    
    
    
    
    
    Rent Overdue ForMining
    
    Rent
    
    2003, 2004, 2005 &
    
    Surcharge
    
    2002, 2003, 2004,3
    
    PRIORITY TRADING SDN.BHD.
    ORIGINAL
    
    AREA AFTER
    
    EXPIRY
    
    Rent
    
    Paid
    
    2006
    
    10%
    
    2005 & 2006TENEMENT
    
    LOCALITY
    
    AREA (Ha)
    
    RENEWAL(Ha)
    
    DATE
    
    RM
    
    RM
    
    RM
    
    RM
    
    RMML 108
    
    Bau District (Tai Ton)
    
    
    139.60
    
    
    
    139.60
    
    
    
    18.01.2023
    
    
    
    1,396.00
    
    
    
    1,396.00
    
    
    
    5,584.00
    
    
    
    558.40
    
    
    
    6,142.40ML 123
    
    Bau District (Tai Ton)
    
    
    2.60
    
    
    
    2.60
    
    
    
    22.06.2024
    
    
    
    26.00
    
    
    
    130.00
    
    
    
    
    
    
    
    1,422.00
    
    
    
    1,526.00
    
    
    
    5,584.00
    
    
    
    558.40
    
    
    
    6,142.403
    
    
    Total Amount (RM): Mining Rent Paid and Mining Rent Overdue:
    
    
    7,668.40
 81




---



##### 



Mining Rent
    
    
    
    
    
    Total MiningAnnual
    
    Mining
    
    Overdue For 2002,
    
    
    
    
    
    Rent Overdue ForMining
    
    Rent
    
    2003, 2004, 2005 &
    
    Surcharge
    
    2002, 2003, 2004,4
    
    CARINO SDN.BHD.
    ORIGINAL
    
    AREA AFTER
    
    EXPIRY
    
    Rent
    
    Paid
    
    2006
    
    10%
    
    2005 & 2006TENEMENT
    
    LOCALITY
    
    AREA (Ha)
    
    RENEWAL(Ha)
    
    DATE
    
    RM
    
    RM
    
    RM
    
    RM
    
    RMML 115
    
    
    Bau District (G. Krian)
    
    
    49.40
    
    
    
    49.40
    
    
    
    04.03.2024
    
    
    
    494.00
    
    
    
    2,470.00
    
    
    
    
    
    
    
    
    
    
    
    4
    
    
    Total Amount (RM): Mining Rent Paid and Mining Rent Overdue:
    
    
    2,470.00Mining Rent
    
    
    
    
    
    Total MiningAnnual
    
    Mining
    
    Overdue For 2002,
    
    
    
    
    
    Rent Overdue ForMining
    
    Rent
    
    2003, 2004, 2005 &
    
    Surcharge
    
    2002, 2003, 2004,5
    
    BUROI MINING SDN.BHD.
    ORIGINAL
    
    AREA AFTER
    
    EXPIRY
    
    Rent
    
    Paid
    
    2006
    
    10%
    
    2005 & 2006TENEMENT
    
    LOCALITY
    
    AREA (Ha)
    
    RENEWAL(Ha)
    
    DATE
    
    RM
    
    RM
    
    RM
    
    RM
    
    RMML 125
    
    Bau District (S. Buroi)
    
    
    409.50
    
    
    
    409.50
    
    
    
    19.11.2025
    
    
    
    4,095.00
    
    
    
    
    
    
    
    20,475.00
    
    
    
    2,047.50
    
    
    
    22,522.505
    
    
    Total Amount (RM): Mining Rent Paid and Mining Rent Overdue:
    
    
    22,522.50Grand Total of mining rentals to be paid upfront (RM): 840,481.69RM
    
    
    
    840,481.69
    
    
    
    
    
    
    
    12,435.35
    
    
    
    
    
    
    
    
    
    
    
    828,046.34
 82




---



##### 



SCHEDULE H
 (SEPARATE BUNDLE)
 83




---



##### 



SCHEDULE I
 Excluded Areas
 Intentionally left blank
 84




---



##### 



SCHEDULE J
 Development and Mining Agreement
 THIS AGREEMENT
 1.
    
    [Relevant entity(s) which own the Project Tenement(s)] (Company No. [          ]),a
company incorporated in Malaysia and having its registered office at [     ]
(Owner); and2.
    
    NATURAL KALIMANTAN GOLD SDN BHD,a company incorporated in
Malaysia and having its registered office at [          ] (Contractor).
 WHEREAS:
 A.
    
    The Owner is the owner of the Project Tenements.B.
    
    The Contractor has carried out or procured the carrying out of a Final Feasibility
Study relating to the Project Tenements and as a result thereof it has been decided to
develop the Project on the Project Tenements.C.
    
    The Owner desires to appoint the Contractor to undertake, on Owners behalf and on
the terms and conditions hereinafter contained, the development and operation of the
Mine including the delivery of ore won therefrom to the Milling Company.
 NOW IT IS HEREBY AGREED AND DECLARED
 1.
    
    Definitions And Interpretation
 (a)
    
    DefinitionsContractors Development Costsmeans all capital costs incurred by the
Contractor in relation to the Mine including interest on borrowings.Contractors Exploration Costsmeans all Exploration Expenditure incurred by the
Contractor prior to the date of this Agreement to the extent that the same has not
already been recouped by the Contractor under a prior development and mining
agreement.Contractors Operating Costsmeans all costs (other than Contractors Development
Costs) incurred by the Contractor in relation to the Mine and the mining of ore
from the Mine and delivery thereof to the Milling Company including interest on
borrowings.
 
 85




---



##### 



Contractors Development Feefor any period shall mean the Contractors Development
Costs incurred during such period plus 1.5% or such other percentage as may be agreed
between Owner and the Contractor.Contractors Operating Feefor any period shall mean the Contractors Operating Costs
incurred during such period plus 1.5% or such other percentage as may be agreed between
Owner and the Contractor.Exploration and Shareholders Agreementmeans the agreement so entitled
made on            between, inter alia the Owner and BML.Exploration Expenditurehas the meaning given to that term in the Exploration and
Shareholders Agreement.Minemeans a mine for gold and/or other minerals within the Mining Area to be developed,
equipped and operated by the Contractor pursuant to this Agreement and includes all
earthworks, plant, infrastructure, accommodation, messing, offices and ancillary
facilities and structures necessary therefore.Mining Areameans such portion of the Project Tenements as is proposed by the Final
Feasibility Study to be the subject of a Mine.Project Tenementsmeans the Tenements proposed in the Final Feasibility Study to be the
subject of the Project.Words and phrases not otherwise herein defined shall, unless the context otherwise
requires, have the same meaning as is ascribed to them in the Exploration and
Shareholders Agreement.(b)
    
    Interpretation
 (i)
    
    Words importing the singular number shall include the plural and vice versa;
reference to persons shall include corporations; all headings in this Agreement have
been inserted for convenience only and shall not affect the interpretation thereof.(ii)
    
    All references to a statute or to any guideline or directive, or any Section
of, Schedule to or other provision of a statute, guideline or directive, include any
modification, extension, re-enactment or replacement thereof in force at any
particular time and in respect of a statute includes all regulations, rules, orders,
directives, notices and other instruments then in force and made under or deriving
validity from the relevant statute or Section.(iii)
    
    Words importing any gender shall include all other genders.(iv)
    
    No waiver of any provision of this Agreement nor consent to any departure
therefrom, by either of the parties hereto shall be effective unless the same shall be
in writing and then such waiver or consent shall be effective only in the specific
instance and for the purpose for
 
 86




---



##### 



which it is given. No default or delay on the part of either of the parties
hereto in exercising any rights, powers or privileges hereunder shall
operate as a waiver thereof or of any other right hereunder; nor shall a
single or partial exercise thereof preclude any other or further exercise
thereof or the exercise of any other right, power or privilege hereunder.(v)
    
    Where, by virtue of the provisions of this Agreement, the day
on or by which any act, matter or thing is to be done is a Saturday, a Sunday
or a public holiday in the place in which the act, matter or thing is to be
done, it may be done on the next succeeding day which is not a Saturday, a
Sunday or a public holiday.(vi)
    
    This Agreement shall be binding on the successors-in-title of
the parties hereto and where the context so admits shall include the assigns
and the persons or corporations deriving title under them respectively.(vii)
    
    References to Clauses are to be construed as references to
Clauses of this Agreement.(viii)
    
    Any covenant not to do anything also constitutes an obligation not to
suffer, permit or cause that thing to be done.
 2.
    
    WarrantiesThe Contractor hereby warrants that:
 (a)
    
    it has or has access to the expertise and technical skills of Zedex Minerals
Limited necessary for the fulfillment of its obligations hereunder.(b)
    
    it has or will have (whether by direct employment or by secondment from a
related or associated corporation) an adequate staff and workforce for the
fulfillment of its obligations hereunder.
 3.
    
    AppointmentSubject to and upon the terms and conditions contained in this Agreement Owner hereby
appoints the Contractor as its operator to develop and operate the Mine in accordance with
the Final Feasibility Study and mining plans developed and amended by the Contractor from
time to time and to deliver to the Milling Company the ore won from the Mine and the
Contractor hereby accepts such appointment.4.
    
    Powers And Duties Of Contractor
 (a)
    
    The Contractor shall be entitled to occupy the Mining Area for the purposes
of
fulfilling its obligations hereunder.(b)
    
    The Contractor shall, either itself or through such agents or contractors as
it
may from time to time engage, undertake and carry out the following
activities:
 
 87




---



##### 



(i)
    
    the design, construction and commissioning of the Mine and the conduct of
mining operations therein;(ii)
    
    the obtaining, evaluation and acceptance of quotes and tenders and the
entering into of contracts for all necessary construction and development works;(iii)
    
    the mining, transportation, handling, loading and stockpiling of the ore
mined and the delivery thereof to the Milling Company;(iv)
    
    the maintenance, operation and protection of such of the Owners property as
shall be in the Contractors control or custody;(v)
    
    the acquiring of materials, plant, buildings, machinery, equipment and
supplies;(vi)
    
    the engagement, dismissal, supervision and control of agents, independent
contractors, experts, advisers, superintendents and engineers;(vii)
    
    the engagement, dismissal, supervision and control of staff and labour and
the determination of the terms and conditions of their employment including the
fixing and paying of their salaries, emoluments, benefits and other expenses;(viii)
    
    (except as may otherwise be directed by Owner) the effecting and maintenance in the
name of Owner and the Contractor to the extent of their respective rights and
interests, of all usual insurances appropriate in the circumstances in relation to the
Mine and to all employees or agents engaged in any way in the operations on the Mine
(including all necessary workers compensation insurances) and the provision to Owner
of particulars of all such insurances;(ix)
    
    the complying with all laws applicable to the operations including laws
relating to employment and to safety and environmental protection; and(x)
    
    the doing of all other acts and things as may in the Contractors judgment be
necessary or advisable for efficient and economic operation of the Mine (including
periodic suspension of the operation of the Mine).
 (c)
    
    The Contractor shall perform all of its obligations hereunder and conduct the operations in
accordance with programmes and budgets established by it and in a good workmanlike and
commercially reasonable manner and in accordance with suitable engineering and milling,
procurement and purchasing methods, procedures and practices and with the standard of
diligence and care normally exercised by duly qualified persons in the performance of
comparable work. The Contractor shall not be liable to the Owner for any loss except due to
the Contractors gross negligence or willful misconduct.
 88




---



##### 



5.
    
    Programmes And BudgetsAs soon as possible after the execution of this Agreement, the Contractor shall adopt a
work programme and capital and operating budget for the remainder of the current financial
year and shall provide Owner with a copy thereof. Thereafter and not later than 1st June in
each year the Contractor shall adopt a work programme and an operating budget and a capital
budget for the ensuing financial year commencing on 1st July and shall provide Owner with a
copy of each of such work programme and capital and operating budgets.6.
    
    Records, Accounts And Rights Of Inspection
 (a)
    
    The Contractor shall maintain in accordance with generally accepted industry
and accounting practice full and accurate records of transactions, inventories of
ore in process and in stockpile, stores, consumables, property and assets and
accounts and records of all payments and receipts and all charges and credits.
All such accounts and records shall at all times during the regular business
hours be open to examination by Owner, its duly authorised representatives
and auditors at Owners expense.(b)
    
    Owner, through its servants, agents and auditors shall have the right at all
reasonable times and at its risk and expense to inspect and observe the
operations at the Mine Provided That the frequency or duration of such visits
shall not unreasonably interfere with the normal conduct of the operations at
the Mine. All site rules and regulations applying within or in respect of the
Mine shall be complied with.(c)
    
    At the end of each financial year the Contractor shall take a physical
inventory
supervised by the auditors in accordance with generally accepted industry
practice or other means appropriate in the circumstances.
 7.
    
    Contractors Fees
 (a)
    
    On or about the date of this Agreement the Contractor shall invoice the Owner
for all Contractors Exploration Costs.(b)
    
    At the end of each month during the period of development and operation of
the Mine, the Contractor will invoice Owner with the Contractors
Development Fee in respect of the Contractors Development Costs during that
month.(c)
    
    At the end of the first month after the Commercial Production Date, the
Contractor will invoice the Owner for the Contractors Operating Fee in respect
of the period from the date of this Agreement to the end of such month and
thereafter the Contractor will invoice the Owner at the end of each subsequent
calendar month for the Contractors Operating Fee in respect of that month.(d)
    
    Invoices are payable within 7 days except that the Owner is only required to
pay from cash flow received from the Milling Company pursuant to the Ore Sale
and Purchase Agreement.
 
 89




---



##### 



(e)
    
    If it appears from the audited accounts of the Contractor for any financial year
that there has been either an underpayment or overpayment of the Contractors
Operating Fee or Contractors Development Fee for that financial year any
necessary adjustment shall be made between the parties on the next payment of
the Contractors Operating Fee or Contractors Development Fee (as the case
requires).(f)
    
    The parties may from time to time agree on another basis for calculation or
payment of the Contractors Operating Fee or Development Fee and any such
variation whether on an ad hoc basis or for a specified duration or in respect of a
specified transaction shall be in writing and shall be deemed to have been
specifically incorporated in this Agreement.
 8.
    
    Term
 (a)
    
    The term of the Contractors appointment hereunder shall commence as from
the date hereof and shall continue until the Contractor determines that mining
on the Mining Area has terminated.(b)
    
    Upon termination of its appointment the Contractor shall (subject to the
requirements of any other Development and Mining Agreement between the
parties hereto) transfer and surrender custody and control as Owner may direct
of all Owners property in the Contractors custody or control pursuant to this
Agreement.(c)
    
    Termination of this Agreement shall not affect the rights or obligations of
either party which shall have accrued as at the date of termination.
 9.
    
    Authority  Indemnification
 (a)
    
    Neither the Contractor nor its directors, officers, agents and employees shall
be
responsible for any costs, losses, claims, damages or liabilities suffered or
incurred in the discharge of its duties in accordance with this Agreement,
except to the extent hereinafter provided as a result of the Contractors gross
negligence or willful default and in respect of the ore produced the Contractors
responsibility to Owner shall cease after delivery of the ore to the Milling
Company. The Contractor shall indemnify Owner and hold it harmless from
and against any and all costs, losses, claims, damages and liabilities (but not
consequential loss) resulting from the Contractors gross negligence or willful
default but only to the extent that the same is not covered by insurance effected
pursuant to Clause 4(b) or does not arise out of an event in respect of which
Owner has directed the Contractor pursuant to Clause 4(b) not to insure.(b)
    
    The Contractor shall not have authority to act for or to assume any obligation
or liability on behalf of Owner except such authority as is conferred on it by or
pursuant to this Agreement.
 90




---



##### 



10.
    
    Assignment And DelegationNeither party hereto may, without the consent in writing of the other party, assign its
rights or obligations hereunder nor may the Contractor without the prior consent of Owner:
 (a)
    
    delegate the whole of its obligations or duties under this Agreement; or(b)
    
    delegate any part of its obligations or duties under this Agreement, except as
authorised by this Agreement.
 11.
    
    Force Majeure
 (a)
    
    If the Contractor is rendered unable wholly or in part by force majeure to
carry
out its obligations under this Agreement, it shall give Owner prompt notice of
the force majeure with reasonably full particulars thereof and the Contractors
obligations so far as they are affected by the force majeure shall be suspended
during but not longer than the continuance of the force majeure and such further
period thereafter as shall be reasonable in the circumstances.(b)
    
    The Contractor shall use all reasonable diligence in the circumstances to
remove the force majeure as quickly as practicable, save that it shall not
thereby be rendered liable to settle any strike, lockout or other labour difficulty
on terms not reasonably acceptable to it.(c)
    
    The term force majeure shall include:
 (i)
    
    war, whether declared or undeclared, revolution or act of
public enemies;(ii)
    
    riot or civil commotion;(iii)
    
    terrorist attack;(iv)
    
    strike or lockout or stoppage or ban or limitation on work or
restraint of labour whether at the plant, the mine, railway or port or airport
or otherwise;(v)
    
    act of God;(vi)
    
    fire, flood, storm, tempest or washaway;(vii)
    
    act or restraint or any governmental or semi-governmental or
other public or statutory authority, and(viii)
    
    any other cause not reasonably within the control of the Contractor.
 12.
    
    Confidentiality
 
 91




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##### 



(a)
    
    Each party shall keep confidential all reports, records, and data studies made,
opinions furnished, and other information obtained in the course of its activities
hereunder (other than information already in the public domain or which
subsequently comes into the public domain without breach hereof) and shall
not disclose the same except:
 (i)
    
    as may be reasonably necessary for the proper performance of
its obligations under this Agreement, or(ii)
    
    as may be required by law law or a court of competent
jurisdiction or any relevant securities exchange or regulatory or governmental
body to which it is subject wherever situated.
 (b)
    
    The provisions of Clause 12(a) shall continue to bind the Contractor for a
period of twelve months from the date it has ceased to be a party to this
Agreement for whatever reason.
 13.
    
    Notices
 (a)
    
    All payments to be made to a party hereunder may (to the extent possible) be
made and all notices, offers, requests, consents, demands and other documents
and communications (other than day to day communications between Owner
and the Contractor) required or permitted to be given under this Agreement
shall be in writing and may be addressed to a party at the address set forth in
Clause 13(b) or to such other address as that party may have substitute
therefore by notice in writing to the other party, and shall be either delivered
personally or sent by telex, facsimile, telegraph or mail (postage prepaid) and
shall be deemed to have been made or given in the case of telex or facsimile
transmission on answerback and in the case of telegraph on the day of
transmission and in the case of ordinary mail, on the fourth day after posting.
The addressee shall in any case when requested by the sender, promptly
provide the sender by telex, facsimile transmission or
telegraph
acknowledgment of receipt, but the delay or failure to give or receive any such
acknowledgment will not affect the validity of the communication in respect
of which it is sought.(b)
    
    The addresses of the parties shall, until substituted in accordance with Clause
13 (a) be as follows:
 Owner
    
    
    
    [                    ]The Contractor
    
    
    
    [                    ]
 14.
    
    Modifications And Waivers
 (a)
    
    No modification, variation or amendment of this Agreement shall be of any
force or effect unless such modification, variation or amendments is in writing and
has been signed by both parties hereto.
 
 92




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##### 



(b)
    
    No waiver by one Party of any one or more defaults of another Party in the
performance of this Agreement shall operate or be construed as a waiver of any
future default or defaults by the same Party, whether of a like or of a different
character.
 15.
    
    Cost, Etc.Each Party, shall bear its own costs in and about the preparation, execution and delivery of
this Agreement and the Contractor shall bear any stamp duty hereon.16.
    
    Governing LawThis Agreement shall be governed by and construed in accordance with the laws of Malaysia.
 IN WITNESS
 THE COMMON SEALof [relevant entity]was hereunto
    
    
    )affixed by authority of its Board of
    
    
    )Directors in the presence of:
    
    
    )Director
    
    
    
    
    
    Director/SecretaryName (printed):
    
    
    
    
    
    Name (printed):THE COMMON SEALof NATURAL
    
    
    )KALIMANTAN GOLD SDN BHDwas
    
    
    )hereunto affixed by authority of its Board
    
    
    )of Directors in the presence of:
    
    
    )Director
    
    
    
    
    
    Director/SecretaryName (printed):
    
    
    
    
    
    Name (printed):
 93




---



##### 



SCHEDULE K
 Ore Sale and Purchase Agreement
 THIS AGREEMENTis made on
    
    2006
 BETWEEN
 1.
    
    [Relevant entity(s) which own the Project Tenement(s)] (Company No. [          ]),
a company incorporated in Malaysia and having its registered office at [          ]
(Seller); and2.
    
    [          ], a company incorporated in Malaysia and having its registered office at [     ]
(hereinafter referred to as Buyer).
 WHEREAS
 A.
    
    The Seller owns the Project Tenements on which a Mine is to be developed and
operated pursuant to the Development and Mining Agreement.B.
    
    The Buyer has determined to proceed with the development and operation of a Mill
for the purpose, inter alia, of processing ore purchased from the Seller as hereinafter
provided.NOW IT IS HEREBY AGREED AND DECLARED as follows:1.
    
    Definitions And Interpretation
 (a)
    
    DefinitionsDevelopment and Mining Agreementmeans the agreement so entitled
made on                      between the Seller and the Contractor.Exploration and Shareholders Agreementmeans the agreement so entitled
made on                      between, inter alia, the Seller and BML.Production Costmeans all monies payable by the Seller to the Contractor under
the Development and Mining Agreement.Words and phrase not otherwise herein defined shall, unless the context otherwise
requires, have the same meaning as is ascribed to them in the Exploration and
Shareholders Agreement or the Development and Mining Agreement (as the case may
be).
 
 94




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##### 



(b)
    
    Interpretation
 (i)
    
    Words importing the singular number shall include the plural
and vice versa; reference to persons shall include corporations; all headings
in this Agreement have been inserted for convenience only and shall not affect
the interpretation thereof.(ii)
    
    All references to a statute or to any guideline or directive,
or any Section of, Schedule to or other provision of a statute, guideline or
directive, include any modification, extension, re-enactment or replacement
thereof in force at any particular time and in respect of a statute includes
all regulations, rules, orders, directives, notices and other instruments then
in force and made under or deriving validity from the relevant statute or
Section.(iii)
    
    Words importing any gender shall include all other genders.(iv)
    
    No waiver of any provisions of this Agreement nor consent to
any departure therefrom, by either of the parties hereto shall be effective
unless the same shall be in writing and then such waiver or consent shall be
effective only in the specific instance and for the purpose for which it is
given. No default of delay on the part of either of the parties hereto in
exercising any rights, powers or privileges hereunder shall operate as a
waiver thereof or of any other right hereunder; nor shall a single or partial
exercise thereof or the exercise of any other right, power or privilege
hereunder.(v)
    
    Where, by virtue of the provisions of this Agreement, the day
on or by which any act, matter or thing is to be done is a Saturday, a Sunday
or a public holiday in the place in which the act, matter or this is to be
done, it may be done on the next succeeding day which is not a Saturday, a
Sunday or a public holiday.(vi)
    
    This Agreement shall be binding on the successors-in-title of
the parties hereto and where the context so admits shall include the assigns
and the persons or corporations deriving title under them respectively.(vii)
    
    The Schedule to this Agreement shall be taken read and
construed as an essential part of this Agreement.(viii)
    
    References to Clauses are to be construed as references to Clauses of this
Agreement.(ix)
    
    Any covenant not to do anything also constitutes an obligation
not to suffer, permit or cause that thing to be done.
 2.
    
    Sale And Purchase Of OreThe Seller will sell and the Buyer will purchase all ore produced from the Sellers Mining
Area.
 95




---



##### 



3.
    
    TitleTitle to ore sold and purchased hereunder shall pass to the Buyer on delivery by or on
behalf of the Seller to the ore stockpile at the Mill.4.
    
    Price
 (a)
    
    The price to be paid by the Buyer for ore supplied to it hereunder during any
month shall be such amount per tonne of ore delivered to Buyer during that
month as is equal to the Production Cost for that month divided by the number
of tonnes so delivered. The Seller will invoice the Buyer monthly.(b)
    
    The price is payable within 7 days of receipt of the Sellers invoice for ore
delivered during that month.(c)
    
    The manner of payment is that an amount equal to the Production Costs for
that month shall be paid by the Buyer direct to the Contractor (on account the
Seller) to be applied by the Contractor in payment of monies owing to the
Contractor under the Mining and Development Agreement.(d)
    
    The parties may agree from time to time on some other basis of payment for
ore sold and delivered hereunder and any variation shall be in writing and shall
be deemed to be specifically incorporated in this Agreement.
 5.
    
    AssignmentNeither party hereto may, without the consent in writing of the other party, assign its
rights or obligations hereunder.6.
    
    Force Majeure
 (a)
    
    If either party is rendered unable wholly or in part by force majeure to
carry
out its obligations under this Agreement, it shall give the other party prompt
notice of the force majeure with reasonably full particulars thereof and the
obligations of the party giving notice, so far as they are affected by the force
majeure shall be suspended during but not longer than the continuance of the
force majeure and such further period thereafter as shall be reasonable in the
circumstances.(b)
    
    The affected party shall use all reasonable diligence in the circumstances to
remove the force majeure as quickly as practicable, save that it shall not
thereby be rendered liable to settle any strike, lockout or other labour difficulty
on terms not reasonably acceptable to it.(c)
    
    The term force majeure shall include:
 (i)
    
    war, whether declared or undeclared, revolution or act
of public enemies;
 
 96




---



##### 



(ii)
    
    riot or civil
commotion;(iii)
    
    terrorist attack;(iv)
    
    strike or lockout or stoppage or ban or limitation on work
or restraint of labour whether at the Mine, mill, railway or port of airport or
otherwise;(v)
    
    acts of God;(vi)
    
    fire, flood, storm, tempest or washaway;(vii)
    
    act or restraint or any governmental or semi-governmental
or other public or statutory authority, and(viii)
    
    any other cause not reasonably within the control of the affected party.
 7.
    
    ConfidentialityEach party shall keep confidential all reports and records made or provided and information
obtained in the course of its activities hereunder (other than information already in the
public domain or which subsequently comes into the public domain without breach hereof) and
shall not disclose the same except:
 (a)
    
    as may be reasonably necessary for the proper performance of its obligations
under this Agreement, or(b)
    
    as may be required by law or a court of competent jurisdiction or any relevant
securities exchange or regulatory or governmental body to which it is subject
wherever situated..
 8.
    
    Notices
 (a)
    
    All payments to be made to a party hereunder may (to the extent possible) be
made and all notices, offers, requests, consents, demands and other documents
and communications (other than day to day communications between the Seller
and the Buyer) required or permitted to be given under this Agreement shall be
in writing and may be addressed to a party at the address set forth in Clause
8(b) or to such other address as that party may have substituted therefore by
notice in writing to the other party, and shall be either delivered personally or
sent by telex, facsimile transmission, telegraph or mail (postage prepaid) and
shall be deemed to have been made or given in the case of telex or facsimile
transmission on answerback and in the case of ordinary mail, on the fourth day
after posting. The addressee shall in any case when requested by the sender,
promptly provide the sender with telex, facsimile transmission or telegraph
acknowledgment of receipt, but the delay or failure to give or receive any such
acknowledgment will not affect the validity of the communication in respect of
which it is sought.(b)
    
    The addresses of the parties shall, until substituted in accordance with Clause
8(a) be as follows:
 
 97




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##### 



The Seller
[                                ]The Buyer
[                                ]
 9.
    
    Modifications and Waiver
 (a)
    
    No modification, variation or amendment of this Agreement shall be of any
force or effect unless such modification, variation or amendment is in writing
and has been signed by both parties hereto.(b)
    
    No waiver by one party of any one or more defaults of another party in the
performance of this Agreement shall operate or be construed as a waiver of any
failure default or defaults by the same party, whether of a like or of a different
character.
 10.
    
    Cost, etcEach party shall bear its own costs in and about the preparation, execution and delivery of
this Agreement and the Buyer shall bear any stamp duty hereon.
 11.
    
    Governing LawThis Agreement shall be governed by and construed in accordance with the laws of Malaysia.
  THE COMMON SEALof [relevant entity]was hereunto
    
    
    )affixed by authority of its Board of
    
    
    )Directors in the presence of:
    
    
    )Director
    
    
    
    
    
    Director/SecretaryName (printed):
    
    
    
    
    
    Name (printed):THE COMMON SEALof
    
    
    )[                                ] was hereunto affixed
    
    
    )by authority of its Board of Directors in the
    
    
    )presence of:
    
    
    )
 98




---



##### 



Director
    
    
    
    
    
    Director/SecretaryName (printed):
    
    
    
    
    
    Name (printed):
 99




---



##### 



SCHEDULE L
 FIC Application Letter
 [Date]
 MALAYSIA
 Proposed Joint Venture in Natural Kalimantan Gold Sdn Bhd (NKG)
 enclosed.
  1.
    
    Zedex Minerals Limited
 1.1
    
    BML is a subsidiary of Zedex Minerals Limited, an international resources,
exploration, and development company engaged in the business of acquiring,
exploring, and developing mineral properties in the Australian and Asia-Pacific
regions. The objective of Zedex is to become a leading player in the Asia-Pacific
gold development sector through developing profitable operating mines. Zedex
Minerals Limited is managed from its head office in Auckland, New Zealand.
Staff and consultants are also located in Sydney, Australia, and Hanoi, Vietnam.
Zedex Minerals Limited is listed on the Australian Stock Exchange.1.2
    
    Zedex Minerals Limited was incorporated in New Zealand on 23 February 1999
under the name Zedex Limited. Its name was changed to Zedex Minerals
Limited on 20 November 2003. Zedex Minerals Limited was registered as a
foreign company in Australia on 12 February 2004 under number (ARBN 107 523
428).
 100




---



##### 



1.3
    
    Further information on Zedex Minerals Limited is set out in the attached Proforma
I/2004 completed by Zedex Minerals Limited.2.
    
    BML2.1
    
    Bau Mining Limited was incorporated in Samoa on 24 October 2006 pursuant to the International
Companies Act 1987. BML is the company which has acquired the 55% interest in NKG. BML is a
wholly owned subsidiary of Zedex Minerals Limited. It is intended in due course that up to 9%
of the share capital of BML will be transferred to [Golden Celesta]but the remaining shares
in BML will continue to be held by one or more companies in the Zedex group.2.2
    
    Further information on BML is set out in the attached Proforma I/2004 completed by BML.3.
    
    Gladioli3.1
    
    Gladioli was incorporated in Malaysia on 28 August 1982 and is principally engaged in
investments in land and building.3.2
    
    Further information on Gladioli is set out in the attached Proforma I/2004 completed by
Gladioli.4.
    
    The proposed activities of NKG4.1
    
    It is intended that NKG will undertake exploration and mining activities in the Bau area of
Sarawak, Malaysia. These activities will be undertaken pursuant to various mining tenements
currently held by members of the Gladioli group of companies as well such additional mining
tenements that the Gladioli group of companies and NKG may obtain through the course of the
joint venture. Exploration will be funded by BML and Gladioli subscribing for preference
shares in NKG.4.2
    
    If gold or other precious minerals are discovered in sufficient quantities to be economically
mined, Gladioli and BML may incorporate one or more additional companies for the purposes of
undertaking the mining or processing activities (Milling Company(ies)). It is intended that
any such additional companies will be incorporated with the same shareholding structure, ie
55% held by BML and 45% held by Gladioli.5.
    
    Shareholding of NKG5.1
    
    The shareholders of NKG and their respective shareholdings are as follows:BML                     55%Gladioli                45%5.2
    
    The shareholders in Gladioli and their respective shareholdings are as follows:Ling Lee Soon    20%
 
 101




---



##### 



John Bin Jais @ Jae                       40%
Captain Richard Hou Hee Phat    40%6.
    
    Consents requested6.1
    
    BML respectfully requests the following consents from the Foreign Investment
Committee:
 (a)
    
    Consent for BML and Gladioli to enter into the Joint Venture;(b)
    
    Consent for BML and Gladioli to acquire and/or subscribe for shares
(including preference shares) in NKG from time to time in proportion of 55% and 45%
respectively;(c)
    
    Consent for BML and Gladioli to acquire and/or subscribe for shares in the
Milling Company(ies) in proportion of 55% and 45% respectively, provided that any such
Milling Company is incorporated solely for the purpose of engaging in the exploration,
mining, and/or processing of mined ore and other products and/or selling the gold or
other precious metals resulting from the joint venture.
 7.
    
    Status of Compliance7.1
    
    As Bumiputeras hold 40% of the issued share capital of Gladioli, the effective
Bumiputera shareholding in NKG is currently 18%. Should the Foreign Investment
Committee require NKG to have at least 30% Bumiputera shareholding, Gladioli
will increase its Bumiputera shareholding to at least 67%, resulting in the effective
Bumiputera equity in NKG increasing to 30.15%.7.2
    
    [As the issued share capital of NKG is in excess of RM250,000.00, the share capital
condition in Paragraph 8 for the Guideline for Acquisition of Interests, Mergers and
Take-Overs by Local and Foreign Interests is satisfied.]8.
    
    Further Information8.1
    
    If you require any further information in order to process this application,
please contact [          ], in the first instance. The contact details are as follows:
 [SkrineUnit no. 50-8-1, 8th Floor
Wisma UOA Damansara
50 Jalan Dungun
Damansara Heights
50490 Kuala Lumpur
MALAYSIA
Contact:    Sharon Barbosa
T:               +603 20948111
F:               +603 20943211]
  102




---



##### 



Attachments:
 1.
    
    Certified true copy of the Exploration and Shareholders Agreement relating to the Bau
Project dated [               ]2.
    
    Completed Form FIC S/2004.3.
    
    Proforma I/2004 completed by each of Natural Kalimantan Gold Sdn Bhd, Gladioli Enterprises
Sdn
Bhd, Zedex Minerals Limited and Bau Mining Limited4.
    
    Proforma II/2004 completed by each of Ling Lee Soon, John Bin Jais @ Jae and Richard Hou Hee
Phat.5.
    
    Letter from the Company Secretary of Natural Kalimantan Gold Sdn Bhd confirming the current
equity structure of that company.6.
    
    Letter from the Company Secretary of Gladioli Enterprises Sdn Bhd confirming the current
equity
structure of that company.7.
    
    Declaration FIC SA/2004 affirmed by Managing Director of Zedex Minerals Limited before a
Notary
Public.8.
    
    2006 Annual Report of Zedex Minerals Limited.
 103




---



##### 



SCHEDULE M
 (SEPARATE BUNDLE)
 104




---



##### 



NATURAL KALIMANTAN GOLD SDN BHD
 
    WORDS
    
    MEANINGSAct
    
    the Companies Act, 1965 as amended from time to tune and any
re-enactment thereof.A Director
    
    a Director appointed by the shareholders of Class A ordinary shares.Affiliate
    
    any person, partnership, joint venture, corporation or other form of
enterprise which directly or indirectly controls, is controlled by, or is
under common control with, a Member. For the purpose of the preceding
sentence, control means possession, directly or indirectly, of the
power to direct or cause direction of management and policies through
ownership of voting securities, contract, voting trust or otherwise.




---



##### 



2. Agreed Proportions
    
    the percentage in respect of each of the
Members shareholding in the Company as set out in the Shareholders
Agreement.Auditors
    
    the firm of independent certified public accountants who are for the time
being appointed as auditors of the Company for the purposes of Section
172 of the Act.BML
    
    Bau Mining Limited (Company No. 28544), a company incorporated in
Samoa under the International Companies Act 1987 and having its
registered office at Intetrust Limited, Level 1, Central Bank of Samoa
Building, Beach Road, Apia, Samoa and includes its successors-in-title
and transferees under these Articles.Board
    
    the board of Directors of the Company from time to time.Business
    
    the business of the Company being minerals exploration, mining and
related activities.business day
    
    any day excluding a Saturday, Sunday and public holidays in Malaysia.C Director
    
    a Director appointed by the shareholders of Class C ordinary shares.Company
    
    Natural Kalimantan Gold Sdn. Bhd.Company Secretary
    
    any person or persons appointed to perform the duties of a secretary of
the Company and shall include an assistant or deputy secretary.Directors
    
    the directors of the Company (or their alternates) and Director shall
mean any of them.Exploration
    
    has the same meaning ascribed to it under the Shareholders Agreement.Exploration
Expenditure
    
    has the same meaning ascribed to it under the Shareholders Agreement.Exploration
Programme
    
    has the same meaning ascribed to it under the Shareholders Agreement.Gladioli
    
    Gladioli Enterprises Sdn Bhd (Company No. 89270-K), a company
incorporated in Malaysia and having its registered office at Lots 9 and
10, Block H, Taman Sri Sarawak, Level 2, Jalan Borneo, 93100 Kuching,
Sarawak, Malaysia and includes its successors-in-title and transferees
under these Articles.Interest Rate
    
    LIBOR plus 250 basis points per annum.laws
    
    all laws, regulations, decrees, policies or guidelines which are in force
from time to time in Malaysia, including any amendment or substitution
thereof.LIBOR
    
    the London Inter-Bank Offered Rate for United States dollar denominated
borrowings for 6 month terms.




---



##### 



3. Members
    
    BML and Gladioli, while they remain shareholders of the Company, and
any other person who may in accordance with the provisions of the
Shareholders Agreement become persons registered from time to time in
the Register as owners of the shares and the expression Member shall be
construed accordingly.Office
    
    the registered office for the time being of the Company.ordinary share
    
    shall mean an ordinary share in the Company.preference share
    
    shall mean a preference share in the Company.Preference Share Rate
    
    1.8 x the Interest RateProject
    
    has the same meaning ascribed to it under the Shareholders Agreement.Project Programme
    
    has the same meaning ascribed to it under the Shareholders Agreement.Register
    
    the register of Members to be kept pursuant to the Act.Related Company
    
    has the meaning given to it in section 6 of the Act.Ringgit Malaysia or
RM
    
    Ringgit Malaysia being the lawful currency of Malaysia.seal
    
    the common seal of the Company,share
    
    a share in the Company.Shareholders
Agreement
    
    the Shareholders Agreement entered into on the                     day of
November
2006 and includes any amendment or supplemental thereto.these Articles
    
    these Articles of Association, as originally framed or as from time to time
altered by special resolution.Transferee
    
    in respect of the transfer of any shares in the Company in accordance
with the provisions of these Articles, the party to whom the shares are
to be transferred.Transferor
    
    in respect of the transfer of any shares in the Company in accordance
with the provisions of these Articles, the Member whose shares are the
subject of that transfer.




---



##### 



4. 
      (a)
    
    the right to transfer shares in the Company is restricted as
hereinafter contained;(b)
    
    the number of Members for the time being of the Company shall
not be more than fifty (counting joint holders of shares as one person and not
counting any person in the employment of the Company or of its subsidiary or
any person who while previously in the employment of the Company or of its
subsidiary was and thereafter has continued to be a Member of the Company);(c)
    
    any invitation to the public to subscribe for any shares in
or debentures of the Company is prohibited;(d)
    
    any invitation to the public to deposit money with the
Company for fixed periods or payable at call, whether bearing or not bearing
interest, is prohibited.




---



##### 



5.     Dividend
 (a)
    
    the Class B preference shares shall carry a fixed cumulative
preferential dividend at the rate of zero per cent (0%) on the capital for the
time being paid up on those shares (including any share premium);(b)
    
    the Class D preference shares shall carry a cumulative
preferential dividend at the Preference Share Rate on the capital for the time
being paid up on those shares (including any share premium), payable within
three (3) months of the end of each financial year.
 Capital Repayment
 (c)
    
    on the winding up or repayment of capital, the right of holders
of the preference shares to repayment of the capital paid up on those shares
together with a sum equal to any arrears of the fixed dividend, whether
declared or earned or not, calculated up to the date of the return of capital
and a premium of Ringgit Malaysia Ten Thousand (RM10,000) per share in priority
to any payment to the holders of ordinary shares;
 Redemption
 (d)
    
    the preference shares are liable to be redeemed in accordance
with the following provisions :-
 (i)
    
    the Company may at any time redeem all or
any of the preference shares;(ii)
    
    the Company shall give not less than one
months prior notice in writing (redemption notice) to the holders
of the preference shares of its intention to redeem all or any of the
preference shares which are fully paid up on the date specified in the
redemption notice;(iii)
    
    if the Company decides to redeem a part
only of the preference shares, those redeemed shall be a rateable
proportion (as nearly as




---



##### 



6. 
 practicable without involving fractions of shares) of each holding of such
shares on the redemption date;(iv)
    
    on the redemption date the Company shall redeem the preference shares
specified in the redemption notice at par plus a premium per share to be determined
by the Board at the time of issue and pay the dividend which has accrued on them
(whether declared or earned or not) down to the redemption date against delivery to
the Company of the certificates for the shares to be redeemed and shall issue free
of charge fresh certificates for any unredeemed shares;(v)
    
    the preference shares to be redeemed shall cease to rank for dividend on
the redemption date unless on the certificates for the preference shares being
tendered, the Company fails to effect such redemption;(vi)
    
    no preference shares shall be redeemed otherwise than out of distributable
profits or the proceeds of a fresh issue of shares made for the purpose of the
redemption but the premium payable (if any) on redemption shall be paid either out
of distributable profits or, to the extent permitted by law, out of the share
premium account of the Company;(vii)
    
    the Company shall comply with all the provisions of the Act relating to
the redemption of the shares and the creation or increase of a capital redemption
reserve;
 Voting Rights
 (e)
    
    the holders of the preference shares shall not be entitled to receive notice of or to attend
or vote at any general meeting unless :-
 (i)
    
    at the date of the notice convening the meeting the dividend on the
preference shares is twelve (12) months in arrears, for which purpose such dividend
shall be deemed payable on the date and in respect of the period stated in paragraph
(a) of this Article (whether declared or earned or not); or(ii)
    
    the business of the meeting includes the consideration of a resolution
that varies or abrogates the rights attached to the preference shares; or(iii)
    
    the business of the meeting includes the consideration of a resolution to
wind up the Company;
 Further Participation
 (f)
    
    save as provided in paragraphs (a), (b) and (c) of this Article, the preference shares
shall not entitle the holders to any further or other participation in the profits or assets
of the Company.




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7.




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8.




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10.    (a)
    
    The Company shall not be bound to register more than four (4)
persons as the holders of any share.(b)
    
    The joint holders of a share shall be liable severally as well
as jointly in respect of all calls and other payments which ought to be made in
respect of such share.(c)
    
    On the death of any one of such joint holders the survivor or
survivors shall be the only person or persons recognised by the Company as
having any title to such share but the Directors may require such evidence of
death as they may deem fit.(d)
    
    Any one of such joint holders may give effectual receipts for
any dividend and payment on account of dividend, bonus, return of capital and
other money payable in respect of such share.(e)
    
    Only the person whose name stands first in the Register as one
of the joint holders of any share shall be entitled to delivery of the
certificate relating to such share or to receive notices from the Company and
any notice given to such person shall be deemed notice to all the joint
holders.




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11.     (a)
    
    Before transferring or requiring the Company to register a
transfer of any shares, the Proposing Transferor shall give a notice in writing
(hereinafter called the transfer notice) to the Company that it desires to
transfer the same and the transfer notice shall constitute the Company its
agent for the sale of the shares therein mentioned (Relevant Shares) at the
Prescribed Price to any Member. A transfer notice once given shall not be
revocable except with the approval of the Board. Unless agreed in writing by
the other Members, a transfer notice must be given in respect of all (and not
some only) of the Transferors shares in the Company.(b)
    
    All shares included in any transfer notice shall be offered by
the Company in the first instance for sale at the Prescribed Price to the other
Members. All offers of shares under this Article 26 shall be made by writing
sent through the post in prepaid letters addressed or by facsimile transmission
to the Members at their respective registered addresses, and every such offer
shall have a time period of sixty (60) days within which the offer must be
accepted or in default may be treated as declined. Every offer shall be
capable of acceptance by the offeree or its nominee, such nominee to be, if
Malaysian law or governmental policy so requires, a Malaysian citizen or
corporation qualified to accept and hold such shares.(c)
    
    If the Company within a period of sixty (60) days after
receiving the transfer notice (or such longer period as may be necessitated by
the provisions of Articles 26(g) or (h) below) shall find a Member or nominee
of a Member (Purchaser) willing to purchase the Relevant Shares, the Company
shall give notice in writing thereof to the Proposing Transferor, and the
Proposing Transferor shall be bound, upon payment of the Prescribed Price, to
transfer the shares mentioned in the transfer notice to the Purchaser.(d)
    
    Every notice by the Company under Article 26(c) stating that it
has found a Purchaser for the Relevant Shares shall state the name and address
of the Purchaser and the purchase shall be completed at a place and time to be
fixed by the Company, not being more than thirty (30) days after the date on
which the Prescribed Price of the Relevant Shares shall have been




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12. 
 agreed or fixed as hereinafter provided, unless the provisions contained in Article 26(h)
shall apply.(e)
    
    If the Proposing Transferor, after having become bound to transfer the Relevant Shares to a
Purchaser, shall default in transferring the Relevant Shares, the Company may transfer the
Relevant Shares to the Purchaser, and the Company may receive the purchase money, and shall
thereupon cause the name of the Purchaser to be entered in the Register and shall hold the
purchase money in trust for the Proposing Transferor. The receipt of the Company for the
purchase moneys shall be a good discharge to the Purchaser, and he or it shall not be bound to
see to the application thereof, and after the name of the Purchaser has been entered in the
Register in purported exercise of the aforesaid powers the validity of the proceedings shall
not be questioned by any Member.(f)
    
    If the Company shall not, within a period of sixty (60) days after receiving a transfer
notice (or such longer period as may be necessitated by the provisions of Article 26(g) or (h)
below), find a Member or nominee of a Member desiring to purchase the Relevant Shares, and has
given notice in writing thereof to the Proposing Transferor, or if the Company shall within
the period aforesaid give to the Proposing Transferor notice in writing that the Company has
no prospect of finding purchasers of such shares, the Proposing Transferor shall be at liberty
to transfer the Relevant Shares at any time within one hundred and twenty (120) days after
giving the transfer notice to any person or company qualified under Malaysian law and
governmental policy to accept and hold such shares, at a price not being less than the price
at which the shares were offered to the Members.(g)
    
    For the purposes of this Article 26, Prescribed Price means the sum per share specified in
any transfer notice as the sum which the Proposing Transferor fixes as the fair value of the
Relevant Shares, unless the purchaser, when agreeing to purchase the Relevant Shares notifies
the Company that it does not accept such sum as the fair value of the Relevant Shares, in
which case, and also in any case where the transfer notice does not specify any sum per share
as the fair value of the Relevant Shares, or is deemed to be given pursuant to any provision
of these Articles of in the Shareholders Agreement, the Prescribed Price of the Relevant
Shares shall be the fair value of the shares to be agreed between the Proposing Transferor and
the Purchaser within fourteen (14) days after the name and address of the Purchaser is
notified by the Company to the Proposing Transferor or, failing such agreement, the fair value
determined by an internationally recognised merchant bank nominated by the Companys main
banker. All costs incurred shall be borne equally by the Proposing Transferor and the
Purchaser concerned. The merchant bank shall be acting as an expert not as an arbitrator and
the provisions of the Arbitration Act, 2005 shall not apply.(h)
    
    Notwithstanding anything herein contained where the sale of any share shall be subject to
approval being obtained from the relevant regulatory authorities in Malaysia, including but
not limited to the Foreign Investment Committee, then completion of the sale of shares shall
be subject to such approvals being obtained.




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13.




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14.




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15.




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16.       (a)
    
    increase the authorised or paid up share capital by such sum
to be divided into shares of such amount as the resolution shall prescribe;(b)
    
    consolidate and divide all or any of its share capital into
shares of larger amount than its existing shares;(c)
    
    subject to the Act, subdivide its shares or any of them into
shares of smaller amount than is fixed by the memorandum; so however that in
the subdivision the proportion between the amount paid and the amount (if any)
unpaid on each reduced share shall be the same as it was in the case of the
share from which the reduced share is derived; and the resolution may
determine that, as between the shares resulting from such subdivision, one or
more of the shares may have preferred or deferred or other special rights over
or be subject to any restrictions as compared with others; or(d)
    
    cancel shares which at the date of the passing of the
resolution in that behalf have not been taken or agreed to be taken by any
person or which have been forfeited and diminish the amount of its share
capital by the amount of the shares so cancelled.




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17.      (a)
    
    notice of any such general meeting by instantaneous
telecommunication device has been given in the manner set out in Article 153;(b)
    
    each of the Members or its duly authorised representative(s)
taking part in such meeting by the instantaneous telecommunication device must
be able to hear and/or see, as the case may be, each of the other Members or
their duly authorised representative(s) taking part at the commencement and
for the duration of such general meeting;(c)
    
    at the commencement of such general meeting each Member or
its duly authorised representative(s) must acknowledge his presence for the
purpose of a general meeting of the Company to all of the other Members or
their respective duly authorised representative(s) taking part.




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18.




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19.




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20. 
 (a)
    
    by the Chairman of the meeting;(b)
    
    by at least two (2) Members present in person or by proxy;(c)
    
    by any Member or Members present in person or by
proxy and representing not less than one-tenth (1/10) of the total voting
rights of all the Members having the right to vote at the meeting; or(d)
    
    by a Member or Members holding shares in the Company conferring
a right to vote at the meeting being shares on which an aggregate sum has been
paid up equal to not less than one-tenth (1/10) of the total sum paid up on all
the shares conferring that right.
    VOTES OF MEMBERS




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21. 
     (a)
    
    any amendment to any provision of the Memorandum and Articles
of Association of the Company;(b)
    
    the liquidation, dissolution, reorganisation or restructuring of the Company;(c)
    
    any increase of the authorised or issued ordinary share capital
of the Company or any grant of any option over the unissued share capital of
the Company. For the avoidance of doubt, the issue of preference shares only
requires approval by simple majority vote of the Members;(d)
    
    any subscription by the Company for, or any purchase or
acquisition by the Company of, any shares, debentures, loan stock or other
securities (or interest therein) whatsoever in, or any acquisition of any
business, undertaking or assets of, any other company or unincorporated body;(e)
    
    the issuance by the Company of any debentures, loan stock or
other form of security or the granting of any options or other rights over any
of the same;(f)
    
    any change in the auditors of the Company; and(g)
    
    any change in the financial year of the Company.
  (a)
    
    any distribution of shares in the Company to the
Members arising from capitalisation of share premium accounts;




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22. 
 (b)
    
    any issuance of ordinary shares in the Company other than as
contemplated by the Shareholders Agreement.
     I/We,
  
  This form is to be used *in favour of/against the resolution.
 
 *
    
    Strike out whichever is not desired. [Unless otherwise instructed, the proxy may vote as he
thinks fit.]




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23. 
         Holder of Class C ordinary shares
    
    3 DirectorsHolder of Class A ordinary shares
    
    2 Directors
 the




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24.




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25.    (a)
    
    has a receiving order in bankruptcy made against him or makes
any arrangement or composition with his creditors generally;(b)
    
    becomes prohibited from being a Director by reason of any
order made under the Act or contravenes Section 130 of the Act;(c)
    
    ceases to be a Director by virtue of the Act;(d)
    
    becomes of unsound mind or a person whose person or estate is
liable to be dealt with in any way under the law relating to mental disorder;(e)
    
    resigns his office by notice in writing to the Company;(f)
    
    is removed from his office of Director by the Member appointing him;(g)
    
    for more than six (6) months is absent from board meetings
without permission of the Member appointing him.




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26.




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27. 
     (a)
    
    of all appointment of officers.(b)
    
    of the names of all the Directors
present at each meeting of the Directors and of any Committee of
Directors and of the Company in general meeting.(c)
    
    of all resolutions and proceedings of
general meetings and of meetings of the Directors and Committees of
Directors.(d)
    
    of all orders made by the Directors and any Committee of Directors.




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28.      (a)
    
    all the Directors (including their alternates) shall have
received notice of a meeting by instantaneous telecommunication device for
the purpose of such meeting. Notice of any such meeting will be given in the
manner set out in Article 106;(b)
    
    each of the Directors (or their alternates) taking part in
the meeting by the instantaneous telecommunication device must be able to
hear and/or see, as the case may be, each of the other Directors (or their
alternates) taking part at the commencement and for the duration of the
meeting;(c)
    
    at the commencement of the meeting each Director (or his
alternate) shall acknowledge his presence for the purpose of the meeting to
all of the other Directors (or their alternates) taking part.




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(a)
    
    any distribution of shares in the Company to the Members
arising from capitalisation of share premium accounts;(b)
    
    any issuance of ordinary shares in the Company other than as
contemplated by the Shareholders Agreement.




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30.  (a)
    
    the exercise of any of the Companys borrowing powers
(including the establishment of any bank overdraft and the raising of any
limit on such overdraft but expressly excluding the acceptance by the Company
of any advance or loan from BML), the exercise of any of the Companys powers
to mortgage or charge its undertaking or property or any part thereof or the
exercise of any of the Companys powers to guarantee any obligation of any
third party provided that the A Director may not unreasonably withhold an
affirmative vote in respect of a Project financing proposal put forward by the
C Directors;(b)
    
    the declaration of any dividend or other distribution (other
than dividends payable on the preference shares which shall be approved by a
simple majority vote);(c)
    
    the entry by the Company into any material long term
contracts or arrangements or any contracts or arrangements made otherwise than
in the ordinary course of the Companys business or otherwise than on an arms
length basis, except, in each case, any contract required in order to progress
any Exploration or Project in the manner contemplated in the relevant
Exploration Programme or Project Programme;(d)
    
    the incurring by the Company of any single item of capital
expenditure which has not been approved under the budget for such financial
year (as may be established by the Board of the Company) and which exceeds 20%
of the amount of capital expenditure contemplated in such approved budget;(e)
    
    any change in the accounting policies or practices of the Company; and/or(f)
    
    the entry by the Company into any joint venture or
partnership except, in each case, any joint venture or partnership required in
order to progress any Exploration or Project in the manner contemplated in the
relevant Exploration Programme or Project Programme.




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31. 
    (a)
    
    any arrangement for giving the Director himself or any other
Director any security or indemnity in respect of money lent by him to or
obligations undertaken by him for the benefit of the Company; or(b)
    
    any arrangement for the giving by the Company of any security
to a third party in respect of a debt or obligation of the Company for which
the Director himself or any other Director has assumed responsibility in whole
or in part under a guarantee or indemnity or by the deposit of a security; or(c)
    
    any contract by the Director himself or any other Director to
subscribe for or underwrite shares or debentures of the Company.




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32.




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33.




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34.




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35.




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36.




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37.




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38.




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39.  (a)
    
    the foregoing provisions of this Article shall apply only to
the destruction of a document in good faith and without express notice that the
preservation of such document was relevant to a claim;(b)
    
    nothing contained in this Article shall be construed as
imposing upon the Company any liability in respect of the destruction of any
such document earlier than as aforesaid or in any other circumstances which
would not attach to the Company but for the provisions of this Article; and(c)
    
    reference in this Article to the destruction of any document
include references to its disposal in any manner.
      (a)
    
    hand; or(b)
    
    registered post, first class post or express or air mail or
other fast postal service; or(c)
    
    facsimile or telex or telegram (each to be followed by postal
service as provided under Article 153(1)(b) such obligation not to affect the
effect of the original notice sent by facsimile);




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40.   (a)
    
    if delivered by hand, at the time of delivery;(b)
    
    if sent by registered post, first class post or express or air
mail or other fast postal service, within ten (10) days of despatch; and(c)
    
    if transmitted by way of facsimile transmission or telex or
telegram, at the time of transmission.
  (a)
    
    in the case of registered post, first class post or express or
air mail or other fast postal service, that the notice or other document was
contained in an envelope which was duly addressed and posted; and(b)
    
    in the case of facsimile transmission or telex or telegram,
that the facsimile transmission or telex or telegram was duly transmitted from
the despatching terminal, as evidenced by a transmission report
generated by the transmitting equipment provided that if the day of
transmission is not a business day or if the facsimile transmission is received
after 5:00pm on a business day, it shall be deemed to have been received on the
next business day.




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41.
  (a)
    
    every Member save as otherwise provided in these Articles or in the Act;(b)
    
    every person entitled to a share in consequence of the death or
bankruptcy of a Member who, but for his death or bankruptcy, would be entitled to receive notice of the meeting; and(c)
    
    the auditor for the time being of the Company.
      (a)
    
    If the Company shall be wound up and the assets available for
distribution among the Members as such shall be insufficient to repay the whole of the paid up capital such assets shall be distributed so that as nearly as may be
the losses shall be borne by the Members in proportion to the capital paid up, or which ought to have been paid up at the commencement of the winding-up, on the shares held by them respectively; and(b)
    
    If in a winding-up the assets available for distribution among the Members shall be more than sufficient to repay the whole of the capital paid up at the
commencement of the winding-up, the excess shall be distributed among the Members in proportion to the capital paid up, or which ought to have been paid up at the commencement of the winding-up, on the shares held
by them respectively.




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42.




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43.  NAMES, ADDRESSES AND DESCRIPTIONS OF SUBSCRIBERS
   Name: 
Occupation:
NRIC No. 
Address: