tions determined to be appropriate by the Coop-
erative Board. 
(c) POWERS; DUTIES.— 
(1) INVESTMENT PARTNERSHIPS.—The Cooper-
ative shall seek to enter into domestic and inter-
national investment partnerships for the develop-
ment of the refinery. 
(2) AGREEMENTS; DIRECT SALES.—The Coop-
erative may— 
(A) enter into equity, financial, and sup-
ply-based agreements or arrangements with 
value-added intermediaries, equipment manu-
facturers, or consumers of rare-earth products, 
and Federal, State, or local agencies to provide 
economic incentives, leases, or public financing; 
and 
(B) engage in direct market sales of rare- 
earth products. 
(3) SUPPLY CONTRACTS AND TOLLING SERV-
ICES.— 
(A) IN GENERAL.—The Cooperative may— 
(i) directly purchase rare-earth mate-
rials obtained from any byproduct pro-
ducers of rare-earths; 
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(ii) transport those materials as un-
processed and unrefined ores, in accord-
ance with part 40 of title 10, Code of Fed-
eral Regulations (parts 12–13b, or any 
corresponding similar regulation or ruling); 
(iii) offer non-member supplier short- 
term or direct purchase contracts; and 
(iv) allow primary rare-earth pro-
ducers to be tolling customers of the Coop-
erative. 
(B) REQUIREMENTS.—A tolling customer 
under subparagraph (A)(iii) shall— 
(i) retain control of the rare-earth 
products during the processing, refining, or 
value adding of the rare-earth products by 
the Cooperative; and 
(ii) take possession of the rare-earth 
products after— 
(I) tolling services are rendered 
by the Cooperative; and 
(II) the Cooperative has received 
payment in full for the tolling services 
rendered. 
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(C) FEE.—The Cooperative may charge 
tolling customers under subparagraph (A)(iii) a 
tolling fee not to exceed the sum of— 
(i) the amount equal to 110 percent of 
the total cost for tolling services rendered 
by the Cooperative on behalf of the tolling 
customer; and 
(ii) the amount equal to five percent 
of the market value of the finished product 
provided to the tolling customer by the Co-
operative. 
(D) 
APPLICABLE
LAW.—Any 
contract 
among consumer members, supplier members, 
tolling customers, and direct purchase suppliers 
entered into under subparagraph (A)(iii) shall 
be 
protected 
as 
provided 
in 
subsection 
552(b)(4) of title 5, United States Code. 
(E) LIMITATIONS.—A direct purchase non- 
member supplier under subparagraph (A)(ii) or 
a 
tolling 
customer 
under 
subparagraph 
(A)(iii)— 
(i) shall not be considered to be a sup-
plier member or otherwise be considered a 
member of the Cooperative for purposes of 
this Act; and 
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(ii) shall not participate in Coopera-
tive profits or have voting rights with re-
spect to the Cooperative. 
(d) AUDITS.— 
(1) IN GENERAL.—The Cooperative shall retain 
an independent auditor to evaluate the extent to 
which Federal funds, if any, made available to the 
Cooperative for research and development activities 
have been expended in a manner that is consistent 
with the purposes of this Act and the charter, by-
laws, and rules of governance of the Cooperative. 
(2) REPORTS.—The auditor retained under 
paragraph (1) shall submit to the Secretary of De-
fense, the Cooperative, and the Comptroller General 
of the United States an annual report containing the 
findings and determinations of the auditor. 
(3) REVIEW BY COMPTROLLER GENERAL.—The 
Comptroller General of the United States shall— 
(A) review each annual report submitted to 
the Comptroller General by the auditor under 
paragraph (2); and 
(B) submit to the Committee on Armed 
Services of the Senate and the Committee on 
Armed Services of the House of Representatives 
a report containing the comments of the Comp-
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troller General on the accuracy and complete-
ness of the report and any other matters relat-
ing to the report that the Comptroller General 
considers appropriate. 
(e) REIMBURSEMENT OF FEDERAL GOVERNMENT.— 
Not later than seven years following the date of the enact-
ment of this Act, the Cooperative shall reimburse the Fed-
eral Government for administrative costs associated with 
the establishment of its charter. 
SEC. 5. THORIUM STORAGE, ENERGY, AND INDUSTRIAL 
PRODUCTS CORPORATION. 
(a) ESTABLISHMENT.— 
(1) IN GENERAL.—As soon as practicable after 
the date of the enactment of this Act, the Coopera-
tive Board, in consultation with the Secretary of De-
fense, shall establish the Thorium Storage, Energy, 
and Industrial Products Corporation to develop uses 
and markets for thorium, including energy. 
(2) FEDERAL
CHARTER.—The Corporation 
shall operate under a Federal charter. 
(b) MANAGEMENT.— 
(1) BOARD OF DIRECTORS.— 
(A) IN GENERAL.—The Board of Directors 
of the Corporation shall comprise five members. 
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(B) INITIAL MEMBERS.—The initial mem-
bers of the Corporation Board shall consist of 
the following members, to be appointed by the 
Secretary of Defense: 
(i) one member, who shall represent 
the Assistant Secretary of Defense for Re-
search and Engineering; 
(ii) a J–7 who will represent the Di-
rector of the Joint Chiefs of Staff; 
(iii) one member, who shall represent 
United States advocacy groups for com-
mercial development of thorium in nuclear 
energy systems; 
(iv) one member, who shall represent 
a national laboratory; and 
(v) one member, who is the member of 
the Initial Board of Directors appointed 
under section 4(b)(1)(A)(v). 
(C) SUBSEQUENT
MEMBERS.—Subject to 
subparagraphs (A) and (D), subsequent mem-
bers of the Corporation Board and Executive 
Committee shall be appointed in accordance 
with bylaws of the Corporation established 
under paragraph (2)(B)(i). 
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