Document:

Standard

Exhibit 10.1

SHAREHOLDERS' AGREEMENT

relating to the

PEDRA BRANCA PROJECT IN BRAZIL

between

ANGLO PLATINUM BRASIL S.A.

and

ALTORO MINERACAO LTDA.

and

PEDRA BRANCA DO BRASIL MINERACAO S.A.

and

RUSTENBURG PLATINUM MINES LIMITED

and

SOLITARIO RESOURCES CORPORATION

1

<PAGE>

TABLE OF CONTENTS

                                              Page

	
1.
	
INTERPRETATION
	
2

	
2.
	
EFFECTIVENESS, TERM AND TERMINATION
	
15

	
3.
	
TRANSACTIONS ON OR AFTER THE EFFECTIVE DATE
	
16

	
4.
	
MANAGEMENT OF THE COMPANY
	
17

	
5.
	
COMPOSITION AND PROCEEDINGS OF THE BOARD
	
17

	
6.
	
APPROVAL OF RESERVED MATTERS
	
19

	
7.
	
SHAREHOLDER MEETINGS
	
20

	
8.
	
WORK PROGRAMMES AND BUDGETS
	
20

	
9.
	
DECISION TO UNDERTAKE MINING
	
24

	
10.
	
FUNDING OF PEDRA BRANCA PROJECT
	
24

	
11.
	
OWNERSHIP INTERESTS AND SHAREHOLDINGS
	
28

	
12.
	
COMPANY LOANS
	
30

	
13.
	
APB'S EARN-IN OPTIONS
	
31

	
14.
	
APB'S FEASIBILITY OPTION AND FINANCING OPTION
	
32

	
15.
	
HSEC STANDARDS AND CONDUCTS OF OPERATIONS
	
34

	
16.
	
COVENANTS RELATING TO PEDRA BRANCA PROJECT
	
35

	
17.
	
AREA OF INTEREST
	
37

	
18.
	
COVENANTS RELATING TO PROJECT FUNDING
	
37

	
19.
	
OTHER COVENANTS
	
38

	
20.
	
GUARANTEE
	
39

	
21.
	
INDEMNITIES
	
39

	
22.
	
REPRESENTATIONS AND WARRANTIES
	
39

	
23.
	
ACCOUNTING MATTERS
	
40

	
24.
	
LIQUIDATION
	
40

	
25.
	
CONFIDENTIAL INFORMATION
	
41

	
26.
	
DISTRIBUTIONS
	
42

	
27.
	
DISPUTE RESOLUTION
	
42

	
28.
	
TRANSFERS OF INTERESTS
	
43

	
29.
	
DEFAULT
	
44

	
30.
	
NOTICES
	
46

	
31.
	
COSTS
	
47

	
32.
	
GOVERNING LAW
	
47

	
33.
	
GENERAL
	
47

	
34.
	
ASSIGNMENT
	
48

	
35.
	
FORCE MAJEURE
	
48

	
36.
	
COUNTERPARTS
	
49

2

<PAGE>

SCHEDULE  1 INITIAL CONTRIBUTION                                                                          55

SCHEDULE  2 EXPERT DETERMINATION                                                                      56

SCHEDULE  3 - PART A, INITIAL WORK PROGRAMME AND BUDGET                   58

SCHEDULE 3 - PART B, ACTUAL WORK AND EXPENDITURE                                  61

SCHEDULE  4 TRANSFER AND SUBSCRIPTION TERMS                                             60

SCHEDULE  5 ENCUMBRANCES                                                                                      61

SCHEDULE  6 MAP OF PROJECT AREA                                                                          62

SCHEDULE  7 PEDRA BRANCA MINERAL RIGHTS                                                     64

SCHEDULE  8 REPRESENTATIONS AND WARRANTIES                                            66

SCHEDULE  9 ELIGIBLE INITIAL INVESTMENT COSTS                                            72

3

 

THIS SHAREHOLDERS' AGREEMENT  is entered into between:
(1)     ANGLO PLATINUM BRASIL S.A., a company incorporated in accordance with the laws of Brazil (hereinafter together with its successors in title referred to as "APB"); 

(2)     ALTORO MINERACAO LTDA., a company incorporated in accordance with the laws of the Brazil (hereinafter together with its successors in title referred to as "AML"); 

(3)     PEDRA BRANCA DO BRASIL MINERACAO S.A., a company incorporated in accordance with the laws of Brazil (hereinafter together with its successors in title referred to as "the Company"); 

(4)     RUSTENBURG PLATINUM MINES LIMITED, a company incorporated in accordance with the laws of South Africa (hereinafter together with its successors in title referred to as "RPM"); and

(5)     SOLITARIO RESOURCES CORPORATION, a company incorporated in accordance with the laws of the State of Colorado, the United States of America (hereinafter together with its successors in title referred to as "Solitario").

WHEREAS
A.     AML is an indirect wholly owned subsidiary of Solitario and owns 4 012 575 ordinary shares in the capital of the Company, representing 100% of the entire issued and outstanding shares in the capital of the Company (save for one share held by Mineracao Solitario do Brasil Ltda., an indirect wholly owned subsidiary of Solitario).

B.     The Company is the legal registered holder of the Pedra Branca Mineral Rights pursuant to which it has certain rights and obligations relating to the exploration and development of the Pedra Branca Project.

C.     APB is an indirect wholly owned subsidiary of RPM, which is an indirect wholly owned subsidiary of Anglo Platinum Limited.

D.     Anglo Platinum Limited and Solitario entered into the Letter Agreement, and RPM and Solitario entered into the Framework Agreement, respectively, which provided for (i) certain terms and conditions for co-operation and collaboration in relation to the exploration and development of certain properties in the State of Ceara, Brazil and (ii) the intention of the AML Group and the APB Group to enter into additional agreements in respect of the establishment of a formal joint venture for the exploration and development of certain of such properties.

E.     APB and AML now wish to conclude a formal agreement pursuant to which they will acquire participation and other ownership interests in the Company upon and subject to the terms and conditions set out in this Agreement and under which APB and AML will provide for their respective rights and obligations as shareholders of the Company and participants in the Pedra Branca Project.

THE PARTIES NOW AGREE AS FOLLOWS

1.     INTERPRETATION

1.1     Definitions - In this Agreement (including the recitals), unless inconsistent with the context, the following words and phrases shall have the respective meanings assigned to them:
"Accounting Procedure" means a set of accounting procedures in agreed form;

"Acquiring Shareholder" has the meaning set out in Clause 17.1;

"Additional Claims" has the meaning set out in Clause 17.1;

"Advance" means any advance granted by a Party in accordance with the terms of this Agreement;

"Affiliate" means in relation to a person, a Subsidiary of that person or a Holding Company of that person or any other Subsidiary of that Holding Company;

"Aggregate Indebtedness" means the total aggregate Indebtedness of the Company owing under all the Company Loan Notes at any time;

"Agreement" means this shareholders' agreement;

"Allowable Expenditures" means such Expenditures as are permitted under the Accounting Procedure, which shall exclude interest but shall include any management fee agreed to be paid pursuant to any services agreements contemplated hereunder;

"AML" has the meaning given to it in the description of the Parties above;

"AML Director" means a member for the time being of the Board nominated and appointed by AML in accordance with this Agreement; 

"AML Group" means AML and its Affiliates excluding the Company;

"AML Service Company" shall have the meaning set out in the AML Services Agreement;

"AML Services Agreement" means an agreement in an agreed form to be entered into between, AML, Solitario, RPM and the Company in accordance with Clause 3.4 pursuant to which AML and Solitario will perform certain work and services for and on behalf of the Company in connection with the Pedra Branca Project;

"APB" has the meaning given to it in the description of the Parties above;

"APB Director" means a member for the time being of the Board nominated and appointed by APB in accordance with this Agreement;

"APB Group" means RPM and its respective Affiliates including APB;

"APB Group Policies" has the meaning set out in Clause 15.2;

"Applicable HSEC Standards" has the meaning set out in Clause 15.1;

"Applicable Law" means, with respect to any person or matter, any Law which is binding on or enforceable against such person or applicable to such matter;

"Approved Expenditure" means Allowable Expenditure that has been approved by the Board in accordance with this Agreement, and shall include Allowable Expenditure contemplated by an Approved Work Programme and Budget;

"Approved Work Programme and Budget" means a Work Programme and Budget that has been approved in accordance with Article 8;

"Area of Interest" means the area within a 10 kilometre radius of the perimeter of the Project Area; 

"Articles and By-Laws (New)" means the articles of association and the by-laws of the Company to be adopted on the Effective Date, which shall be in the agreed form;

<PAGE>
"Authorisation" means an authorisation, permit, consent, approval, resolution, licence, exemption, filing, notarisation or registration of any person including any Governmental Authority;

"Authorised Representative" means, in relation to a company or other legal entity:
(a)     one or more directors (or equivalent officers under the laws of the jurisdiction of incorporation of such company or other legal entity) who are duly authorised by such company or other legal entity, whether singly or jointly, to act to bind such company or other legal entity; and

(b)     one or more persons who are duly authorised by such company or other legal entity, whether singly or jointly and whether by power of attorney or otherwise, to act to bind such company or other legal entity;

"Board" means the board of directors of the Company as constituted from time to time after the Effective Date in accordance with this Agreement and the Articles and By-Laws (New);

"Board Meeting" means a meeting of the Board;

"Brazil" means the Federative Republic of Brazil;

"Brazilian Government" means any Governmental Authority in Brazil;

"Business" means, in relation to the Company, (i) the investment in and development by the Company, directly or indirectly, of the Pedra Branca Project, (ii) all actions taken by the Company which are necessary and incidental to the foregoing and (iii) the performance by the Company of its obligations, and the enforcement by the Company of its rights, under this Agreement;

"Business Day" means any day, other than a Saturday, Sunday or any statutory public holiday in the United States, Brazil and South Africa;

"Capital Expenditure" means, in relation to the Company, costs incurred or funded by the Company in respect of fixed or capital assets (including deferred development costs) and which would be classified as capital expenditures of the Company in accordance with IFRS, or under any leasing or similar arrangement which would be classified as a capitalised lease of the Company in accordance with IFRS;

"Cash Call" has the meaning set out in Clause 10.5;

"Change of Control" means the acquisition (whether directly or indirectly) by any person acting individually or in concert with others of Control;

"Company Loan Note Rate" means such rate per annum as may be determined by the Board from time to time, provided that at any given time the Company Loan Note Rate shall be the same for all the Company Loan Notes issued and outstanding at such time;

"Company Loan Notes" means the loan notes issued by the Company from time to time in connection with Advances, which shall be in an agreed form and shall bear interest from time to time at the Company Loan Note Rate and "Company Loan Note" means any of them;

"Confidential Information" means all Mining and Prospecting Information, commercial and technical information, trade secrets, agreements (whether in writing or not, or in electronic format), or information which can be obtained by examination, testing, visual inspection or analysis, including, without limitation, business or financial data, know-how, formulae, processes, designs, sketches, plans, drawings, specifications, sample reports, models, studies, findings, computer software, inventions or ideas, analyses, concepts, compilations, studies and other material prepared by or in possession of or under the control of a Party, in each case in relation to the Pedra Branca Project or the Business, as well as any information which contains or otherwise reflects or has been generated from any Confidential 

4

<PAGE>
Information and any other information in relation to the Pedra Branca Project or the Business which is not in the public domain; provided that "Confidential Information" shall not include any knowledge or information referred to in Clause 25.2;

"Continuing Shareholder" has the meaning set out in Clause 28.3.1;

"Control" means the ability to control in fact the business and affairs of a person which shall be deemed to occur (a) in respect of a corporate person listed (or whose shares are listed) on a stock exchange, by the ownership or control of at least 35% of the voting interests in such person and (b) in respect of any other corporate person, by the ownership or control of greater than 50% of the voting interests in such person;

"Default Interest" means a rate per annum equal to LIBOR plus a margin equal to five percent (5%); 

"Default Loan" has the meaning set out in Clause 10.8.1;

"Defaulting Shareholder" has the meaning set out in Clause 29.1.1;

"Directors" means the APB Directors and the AML Directors, and "Director" means any of them;

"Dispose" means, from time to time and as applicable, the processing, toll smelting, marketing, sale, acquisition and/or other disposal, or the arranging for the processing, toll smelting, marketing, sale, acquisition and/or other disposal;

"Disposing Shareholder" has the meaning set out in Clause 28.3.1;

"DNPM" means the Brazilian Bureau of Mines;

"Earn-in Options" has the meaning set out in Clause 13.1;

"Effective Date" means the date of execution of this Agreement by all the Parties hereto;

"Eligible Initial Investment Costs" means US$ 1,465,814 (one million, four hundred and sixty-five thousand, eight hundred and fourteen United States Dollars), representing Allowable Expenditures funded by or on behalf of APB on or after       28 January 2003 and prior to the Effective Date under the terms of the Letter Agreement (which amount shall include, for certainty, any Allowable Expenditures funded by the APB Group in relation to those mineral rights and claims set out in the Letter Agreement but which, as at the Effective Date, no longer form part of the Properties) and the Framework Agreement, as reflected in Schedule 9 (Eligible Initial Investment Costs);

"Encumbrance" means any mortgage, pledge, lien, security interest, trust arrangement, royalty or similar rights or interest of any third party; 

"Event of Force Majeure" has the meaning set out in Clause 35.1 hereto;

"Expenditure" means any Operating Expenditure or Capital Expenditure;

"Expert" has the meaning set out in Schedule 2 (Expert Determination);

"Exploration" means all activities directed toward ascertaining the existence, location, quantity, quality, grade or commercial value of deposits of platinum group metals, including, without limitation, prospecting, mapping, sampling, drilling, pitting, trial mining, analysis, process testing, test marketing, surveying, geophysics, photography and investigation; 

"Exploration Phase" means, in respect of the Pedra Branca Project (or part thereof), the period from the Effective Date up to the commencement of the Mining Phase for the Pedra Branca Project (or part thereof);

5

<PAGE>
"Fair Value" means, in respect of a sale of Interests from one Party (the "seller") to another Party (the "buyer"), the value agreed between the Parties, or failing agreement the value that the Expert certifies to be the fair market value in such Expert's opinion of such Interests based on, inter alia, the following assumptions:

(a)     the value of any Shares shall be that proportion of the fair market value of the entire issued share capital of the Company that the seller's Shares bear to the then total issued share capital of the Company (with no premium or discount for the size of the seller's shareholding or for the rights or restrictions applying to the Shares under this Agreement or the Articles and By-Laws (New) of the Company);

(b)     the sale is between a willing buyer and a willing seller on the open market;

(c)     the Company's business shall continue to be carried on as a going concern (unless the Company is insolvent or unable to pay its debts within the meaning of the insolvency legislation applicable to the Company) without regard to potential (and as yet unrealised) success of any Exploration conducted during any Exploration Phase;

(d)     the Interests are sold free of Encumbrances; and

(e)     the value of any Pedra Branca Project that is in the Mining Phase shall be determined without reference to any mineral resources other than Proven and Probable Reserves as disclosed in the applicable Mining Feasibility Study for such Pedra Branca Project (or, if a more recent statement of reserves and resources shall have been prepared in accordance with the JORC Code by or under the supervision of an independent qualified person, such statement);

"Feasibility Election Date" has the meaning set out in Clause 14.3; 

"Feasibility Option" has the meaning set out in Clause 14.1;

"Feasibility Option Exercise Date" shall mean the earlier of (i) the date on which APB has incurred and/or funded Approved Expenditure during the Feasibility Period of an aggregate amount equal to US$ 10,000,000 and (ii) the date one Mining Feasibility Study in connection with the Pedra Branca Project (or any part thereof) is delivered to the Board of the Company;

"Feasibility Period" means the period from and after the Feasibility Election Date to the Feasibility Option Exercise Date; 

"Feasibility Shares" has the meaning set out in Clause 14.5;

"Final Earn-in Date" means the date on which the Ownership Interest of APB is equal to or exceeds 51%;

"Finance Option" has the meaning set out in Clause 14.2;

"Finance Option Exercise Date" shall mean the date on which the Board of the Company approves a Project Financing Plan for the placing of the Pedra Branca Project (or any part thereof) into production in accordance with an Approved Work Programme and Budget for such development;

"Finance Shares" has the meaning set out in Clause 14.9;

"Financial Year" means the period commencing each year on January 1 and ending on the following December 31;

"First Option" has the meaning set out in Clause 13.1.1;

"First Option Exercise Date" shall mean the earlier of (i) the last day of the First Earn-in Period, (ii) the date on which APB has incurred and/or funded Approved Expenditure sufficient complete the Initial Work Programme and Budget, and (iii) the date on which APB has incurred and/or funded Relevant Funding in an aggregate amount equal to US$ 2,250,000;

"First 15% Shares" has the meaning set out in Clause 13.3;

6

<PAGE>
"First Earn-in Period" means the period set out in the Initial Work Programme and Budget;

"Framework Agreement" means the framework agreement dated July 14, 2006 between RPM, Solitario and AML pursuant to which certain preliminary steps towards the establishment of the joint venture contemplated herein were provided for, as amended;

"Funding Default" has the meaning set out in Clause 10.8;

"Further 21% Shares" has the meaning set out in Clause 13.3;

"Further Work Programme and Budget" has the meaning set out in Clause 8.7 and "Further Work Programmes and Budgets" means all of them;

"Governmental Authority" means any administrative, executive, fiscal, judicial, legislative or other body of any federal, regional, state, local or any other authority;

"Historical Cost" means an amount equal to:

Y = (A + B) * V

where:
"A"     is the aggregate of (i) the total of the Reducing Shareholder's actual contributions to the Company after the date of the Letter Agreement and to the date of the offer to sell pursuant to Clause 11.8, and (ii) the Reducing Shareholder's Initial Contribution;

"B"     is the aggregate of (i) the total of the non-Reducing Shareholder's actual contributions to the Company after the date of the Letter Agreement and to the date of the offer to sell pursuant to Clause 11.8, and (ii) the non-Reducing Shareholder's Initial Contribution; and

"V"     is  the Reducing Shareholder's Ownership Interest at the date of the offer to sell pursuant to Clause 11.8;

"Holding Company" means a company or corporation of which another company or corporation is a Subsidiary;

"Increasing Shareholder" has the meaning set out in Clause 11.4;

"IFRS" means International Financial Reporting Standards issued or adopted by the International Accounting Standards Board;

"Indebtedness" includes any obligation (whether incurred as principal or as surety) for the payment or repayment of money, whether present or future, actual or contingent (including interest and other charges relating to it);

"Indemnified Losses" means any losses, damages, expenses, liabilities (whether accrued, actual, contingent, latent or otherwise), claims and demands of whatever nature or kind including all legal fees and costs; 

"Initial Work Programme and Budget" has the meaning set out in Clause 8.5;

"Interests" means, in respect of any Shareholder, all right, title and interest of such Shareholder and its Affiliates in Shares, Options, the Company Loan Notes, this Agreement (including its Ownership Interest hereunder), and any and all other rights and privileges arising in connection with this Agreement, and "Interest" means any of the foregoing;

"JORC Code" means 2004 edition of the Australasian Code for Reporting of Mineral Resources and Ore Reserves (the JORC Code) prepared by the Joint Ore Reserves Committee of The Australasian Institute of Mining and Metallurgy, the Australian Institute of Geoscientists and the Minerals Council of Australia, as in effect on the Effective Date;

"Land Agreements" means those agreements entered into from time to time by the Company with land owners in the Project Area;

7

<PAGE>
"Law" means:
(a)     common or customary law;

(b)     any constitution, decree, judgment, legislation, order, ordinance, regulation, statute, treaty or other legislative measure in any jurisdiction; and

(c)     any present or future directive, regulation, practice, concession or requirement which has the force of law and which is issued by any governmental body, agency or department or any central bank or other fiscal, monetary, regulatory, self-regulatory or other authority or agency;

"Letter Agreement" means the letter agreement dated 28 January 2003 between Anglo Platinum Limited (then known as "Anglo American Platinum Corporation Limited") and Solitario in relation to certain funding and earn-in arrangements between the parties thereto pertaining to the Pedra Branca Mineral Rights and certain other mineral rights and claims the subject of such letter agreement, as amended from time to time; 

"LIBOR" means an annual rate equal to the offered rate that appears on the page of the Telerate screen (or any successor thereto) that displays an average British Bankers Association Interest Rate Settlement Rate for deposits in dollars with a term of six months;

"Manager" means the Party (and/or its Affiliates) appointed from time to time in accordance with the terms of this Agreement and the Services Agreement to provide certain operational and technical services to the Company;

"Mining" means any activities relating to the mining for and production of platinum group metals including tailings re-treatment mining operations; ore extraction; milling, processing beneficiation of ore; waste rock handling and disposal; tailings treatment and disposal; mine site rehabilitation; and shall include all activities relating to the design and construction of facilities and related infrastructure to permit the foregoing and all Exploration activities undertaken in the Mining Phase of the Pedra Branca Project (or any part thereof);

"Mining and Prospecting Information" means all information available with respect to hard-rock and tailings re-treatment operations and mapping, sampling, drilling, pitting, trial mining, analysis, process testing, test marketing, surveying, geophysics and photography in relation to the Pedra Branca Project including, but not limited to, all surveys, maps, mosaics, aerial photographs, electromagnetic tapes, electromagnetic or optical disks, sketches, drawings, memoranda, drill cores, logs of such drill cores, geophysical, geological or drill maps, sampling and assay reports, notes and other relevant information and data in whatever form;

"Mining Feasibility Study" means a detailed report, showing the feasibility of placing all or any part of the Property into commercial production, in such form and detail and using such assumptions as to metal prices as are customarily required, at the time of delivery of the Mining Feasibility Study, by institutional lenders of major stand alone non-recourse financing for mining projects, and shall include a reasonable assessment of the mineable ore reserves and their amenability to metallurgical treatment, a complete description of the work, equipment and supplies required to bring the evaluated deposit into commercial production and the estimated cost thereof, a description of the mining methods to be employed and a financial appraisal of the proposed operations supported by all reasonably necessary information and data including at least the following:

(i)     a description of that part of the Properties containing the evaluated deposit and to be covered by the proposed mine;

8

<PAGE>
(ii)     a statement of mineral reserves and resources prepared by or under the supervision of an independent qualified person in accordance with, and employing the definitions of the JORC Code and which clearly discloses the proven and probably reserves of Product comprising the proposed development;

(iii)     the proposed procedure for Mining;

(iv)     results of the metallurgical tests on the metalliferous minerals to be extracted;

(v)     the nature and extent of the facilities proposed to be acquired and constructed which may include mill facilities, if the size, extent and location of the ore body makes such mill facilities feasible, in which event the study shall also include a preliminary design for such mill;

(vi)     the total costs, including capital budget, which are reasonably required to purchase, construct and install all structures, machinery and equipment required for the proposed mine, including a schedule of timing of such requirements;

(vii)     appropriate environmental impact studies and costs and a description of the permits which must be obtained in connection with placing the evaluated deposit into commercial production;

(viii)     the period in which it is proposed the evaluated deposit will be brought to commercial production;

(ix)     such other data and information as are reasonably necessary to substantiate the existence of an ore deposit of sufficient size and grade to justify development of a mine, taking into account all relevant business, tax and other economic considerations; and

(x)     working capital requirements for the initial 12 months of operations of the evaluated deposit as a mine or such longer period as may be reasonably justified in the circumstances;

"Mining Phase" means, in respect of the Pedra Branca Project (or part thereof), the period commencing from the Board decision to undertake Mining activities in connection therewith in accordance with Article 9 and, for clarity, includes the construction of a mine and related infrastructure;

"Non-Defaulting Shareholders" has the meaning set out in Clause 29.1.1;

"Non-Reducing Shareholder's Initial Contribution" in the case of AML shall be an amount calculated in accordance with Schedule 1 (Initial Contribution), and in the case of APB, shall be zero;

"Offered Interest" has the meaning set out in Clause 11.8;

"Operating Expenditure" means, in relation to the Company, all costs incurred or funded by the Company of every kind, nature or description whatsoever other than Capital Expenditure in relation to the Pedra Branca Project;

"Operations" means all Mining and Exploration and related activities carried out pursuant to this Agreement;

"Options" means the Earn-in Options, the Feasibility Option and the Finance Option and "Option" means any of them; 

"Option Shares" means, in respect of APB, all Shares that APB has a right to subscribe for at such time pursuant to any Option (excluding, for greater certainty, any Shares the subscription of which has been completed in accordance with the terms of any Option);

9

<PAGE>
"Ore" means all materials from the Property, the nature and composition of which justifies either:
(i)     mining or removing from place and shipping and selling such material, or delivering such material to a processing plant for physical or chemical treatment; or 

(ii)     leaching such material in place;

"Ownership Interest" means, in respect of a Shareholder, the percentage interest representing the equitable and beneficial ownership interest of such Shareholder in the Company as such interest may from time to time be adjusted hereunder;

"Parties" means APB, AML, the Company, RPM and Solitario and each other person that becomes a party to this Agreement in accordance with its terms, and "Party" shall mean any of them;

"Pedra Branca Mineral Rights" means the mineral rights set out in Schedule 7 (Pedra Branca Mineral Rights), together with any and all ancillary rights under Applicable Law attaching thereto, and the Land Agreements;

"Pedra Branca Project" means all Exploration and Mining activities undertaken by the Company on or in respect of the Properties;

"Products" means:
(i)     all Ore shipped and sold prior to treatment; and 

(ii)     all concentrates, precipitates, doré, refined gold, platinum group metals and other refined metals and products produced by or for the Company from Ore;

"Project Area" means the surface areas in the central region of the state of Ceara, Brazil covered by the Properties, co-ordinates and a map of which are set out in Schedule 6;

"Project Financing Plan" shall mean a plan that provides for financing arrangements necessary to finance 100% of an Approved Work Programme and Budget for the development of the Pedra Branca Project (or any part thereof) to enable Mining, which plan shall be of sufficient detail to enable the Board, and if applicable, the Shareholders to make a reasoned decision thereon and shall include (i) sources of funding and cost of capital, (ii) identification of any required sponsor support, and (iii) proposed funding structure;

"Properties" means the Pedra Branca Mineral Rights together with any renewals thereof and any other form of substitute or successor title thereto, including any mining concessions or other interests derived from or into which any such claims may have been or may hereafter be converted together with any mineral rights acquired by the Company within the Area of Interest pursuant to Clause 17.1;

"Proven and Probable Reserves" means, at any date, "proven reserves" and "probable reserves" (as such terms are defined in the JORC Code in effect on such date);

"Reducing Shareholder" has the meaning set out in Clause 11.6;

"Reducing Shareholder's Initial Contribution" in the case of AML shall be an amount calculated in accordance with Schedule 1 (Initial Contribution), and in the case of APB, shall be zero;

"Relevant Funding" means at any time the sum of (i) the Eligible Initial Investment Costs, and (ii) the aggregate of all Advances made by members of the APB Group pursuant to Clause 10 on or prior to such time; 
"Required Shareholder Funding" has the meaning set out in Clause 10.4;

10

<PAGE>
"Reserved Matters" means any of the following:

(a)     a variation or modification of the Articles and By-Laws (New) of the Company or the rights attaching to any shares in the capital of the Company; 

(b)     any increase, decrease or change in the amount of the authorised or issued share capital of the Company or in the manner of calculating same (whether by way of capitalisation issue, rights issue, sub-division, consolidation, reduction of capital, share repurchase or otherwise) except as required to enable the subscription of Shares pursuant to the exercise of Options;

(c)     any amendment or alteration in the rights, privileges, restrictions or conditions attaching to any issued or unissued shares in the capital of the Company (save in connection with the adoption of the Articles and By-Laws (New) in accordance with this Agreement);

(d)     the granting by the Company of any option or other interest (in the form of convertible securities or in any other form) over or in its share capital, any redemption or purchase by the Company of any of its own shares or any other reorganisation of its share capital (save as provided in this Agreement);

(e)     the engaging by the Company in any business other than the Business, or the expenditure by the Company of any monies other than in good faith for the purposes of or in connection with the carrying on of the Business;

(f)     the approval of any distribution policy for the Company in relation to the declaration or payment by the Company of any dividend or the making by the Company of any other distribution (by way of capitalisation, repayment or in any other manner);

(g)     the appointment or removal of any member of the Board, other than in accordance with the provisions of this Agreement;

(h)     any proposal that the Company be wound up, reorganised or merged;

(i)     the entering into by the Company of any transaction or arrangement with any member of the AML Group or the APB Group that is not on arm's length terms; 

(j)     any variation to the terms of any the Company Loan Note; or

(k)     the creation of any Encumbrance over or in respect of the Properties except as required for obtaining financing or raising capital in connection with the Business;

"Second Option" has the meaning set out in Clause 13.1.2;

"Second Option Exercise Date" shall mean the earlier of (i) the last day of the Second Earn-in Period, (ii) the date on which APB has incurred and/or funded Approved Expenditure sufficient to complete the Second Work Programme and Budget, and (iii) the date on which APB has incurred and/or funded Relevant Funding in an aggregate amount equal to US$ 4,000,000;

"Second 15% Shares" has the meaning set out in Clause 13.3;

"Second Earn-in Period" means the period set out in the Second Work Programme and Budget;

"Second Work Programme and Budget" has the meaning set out in Clause 8.6;

"Services Agreements" means the AML Services Agreement and any other service agreement entered into by the Parties to appoint a Manager of the Pedra Branca Project and "Services Agreement" means any one of them;

"Shareholder" means each of APB and AML, so long as it holds a Shareholding, and their permitted assigns;

11

<PAGE>
"Shareholding" means, in respect of any Party at any time, an amount (expressed as a percentage) determined in accordance with the following formula:

	
S
	
=
	
S1
	
x
	
100

	
S2

where:

S is the Shareholding of such Party;

S1 is the aggregate number of Shares held by such Party at such time; and

        S2 is the aggregate number of Shares issued and outstanding as at such time; 

"Shares" means ordinary shares in the capital of the Company;

"Sole Funding" means the making of one or more Advances by a Party where such Party is obliged at the relevant time to fund 100% of the Approved Expenditures to which such Advance relates in accordance with the terms of this Agreement, and "Sole Funded" shall be interpreted accordingly;

"Subsidiary" of a company or corporation means any company or corporation:
(a)     50% or more of the issued share capital of which is legally or beneficially owned, directly or indirectly, by the first mentioned company or corporation; 

(b)     where the first-mentioned company owns the right or ability to control directly or indirectly the affairs or the composition of the board of directors (or equivalent of it) of such company or corporation; or

(c)     which is a Subsidiary of another Subsidiary of the first mentioned company or corporation;

"Third Earn-in Period" means the period set out in the Third Work Programme and Budget;

"Third Option" has the meaning set out in Clause 13.1.3;

"Third Option Exercise Date" shall mean the earlier of (i) the last day of the Third Earn-in Period, (ii) the date on which APB has incurred and/or funded Approved Expenditure sufficient to complete the Third Work Programme and Budget, and (iii)  the date on which APB has incurred and/or funded Relevant Funding in an aggregate amount equal to US$ 7,000,000;

"Third Work Programme and Budget" has the meaning set out in Clause 8.6;

"Transfer and Subscription Terms" means the terms and conditions set out in Schedule 4;

"Transferred Interest" has the meaning set out in Clause 29.1.1;

"Transfer Notice" has the meaning set out in Clause 28.3.1; and

"Work Programmes and Budgets" means, collectively, the Initial Work Programme and Budget, the Second Work Programme and Budget, the Third Programme and Budget, Further Work Programmes and Budgets and Supplemental Work Programmes and Budgets and "Work Programme and Budget" means any of them.

1.2     Interpretation - In this Agreement:
1.2.1     any gender includes the other genders;

1.2.2     a "person" shall be construed as a reference to any individual, firm, company, corporation, government, state or agency of a state or any association or partnership (whether or not having separate legal personality) of two or more of the foregoing;

1.2.3     the singular includes the plural and vice versa; 

1.2.4     unless the context otherwise requires, words denoting the singular include the plural and vice versa and references to a person includes its successors and permitted assigns;

12

<PAGE>
1.2.5     a reference to a specified Article, Clause or Schedule shall be construed as a reference to that specified Article, Clause or Schedule of this Agreement and the Schedules are deemed to be incorporated in this Agreement, and a reference to "this Agreement" includes a reference to the Schedules;

1.2.6     a reference to an agreement, law, statute, decree, regulation or other legal instrument shall be construed as a reference to such agreement, law, statute, decree, regulation or other legal instrument as the same may be amended, varied, supplemented, novated, assigned or re-enacted from time to time;

1.2.7     the headings and the Table of Contents are inserted for convenience of reference only and shall not affect the interpretation of this Agreement;

1.2.8     any statement of or reference to "US$" or "United States Dollars" amounts shall mean the legal tender of the United States;

1.2.9     the expression "including" shall be construed as meaning "including without limitation", unless the context otherwise requires; 

1.2.10     a reference to a document, instrument or agreement "in agreed form" shall mean that such document, instrument or agreement has been duly initialled whether before or after this agreement by each Party hereto evidencing that such document, instrument or agreement is in the agreed final form;

1.2.11     any and all notices, approvals, requests, consents, agreements or other communications to be given or made by any Party or the Parties pursuant to this Agreement shall be given or made in writing by such Party or Parties and the Parties hereto agree that "in writing" shall include electronic means of communication, including email;

1.2.12     a legal entity includes its successors and permitted assigns; and

1.2.13     any reference in this Agreement to a time shall, unless otherwise specified, be construed as a reference to Rio de Janeiro time.

2.     EFFECTIVENESS, TERM AND TERMINATION

2.1     Effectiveness - This Agreement shall become effective upon the Effective Date and shall continue in full force and effect until terminated in accordance with the provisions of Clause 2.2.

2.2     Termination - This Agreement shall terminate:
2.2.1     in accordance with Clause 10.9.1;

2.2.2     automatically if, after the First Option Exercise Date, the Shareholding of a Shareholder becomes 100%;

2.2.3     automatically if APB fails to complete the funding threshold set out in Clause 10.1.1;

2.2.4     in accordance with Article 24; or

2.2.5     by mutual written agreement between the Parties, 

            provided that any such termination shall be without prejudice to the accrued rights and obligations of the Parties hereunder, including any obligations in respect of Earn-in Options.

3.     TRANSACTIONS ON OR AFTER THE EFFECTIVE DATE

3.1     Organisation of the Company - The Parties will procure that on the Effective Date:
3.1.1     The Articles and By-Laws of Incorporation (New) are duly approved by the Shareholders and adopted by the Company in accordance with Applicable Law;

3.1.2     The Board shall comprise four directors, two of whom shall be APB Directors and two of whom shall be AML Directors (in accordance with Article 5);

3.1.3     The Board elects two officers to serve as the Board of Officers of the Company;

13

<PAGE>
3.1.4     APB shall take one Share held by Mineracao Solitario do Brasil Ltda. at par value and AML shall transfer one Share each to any two APB Directors nominated by APB; 

3.1.5     Deloitte shall be appointed as the auditors of the Company (unless at such time Deloitte are validly appointed as the auditors of the Company);

3.1.6     There shall be opened and maintained an account in the name of the Company with an account bank approved by the Board; and

3.1.7     Each APB Director shall be appointed as the alternate of the other APB Director and each AML Director shall be appointed as the alternate of the other AML Director in accordance with Applicable Law. 

3.2     Eligible Initial Investment Costs -  The Parties recognize and acknowledge that members of the APB Group have, prior to the Effective Date, funded an amount equal to the Eligible Initial Investment Costs and that such amount is to be treated for all purposes under this Agreement as a portion of the funding contemplated under Clause 10.1.1.

3.3     No Partnership - Nothing in this Agreement shall be construed as creating a partnership between any of the Parties.

3.4     Services Agreement - Each of AML, Solitario and RPM shall enter into the AML Services Agreement and the Parties shall procure that the Company enters into, the AML Services Agreement.  The Parties recognize and acknowledge that all amounts paid and or reimbursed under the terms of the AML Services Agreement shall be treated as Allowable Expenditures for the purposes of the funding contemplated under Clause 10.1.

3.5     APB and AML May Not Bind Other Parties - Save as may otherwise be permitted by the Services Agreements, neither APB nor AML (nor any of their respective Affiliates) shall be entitled to incur any obligations on behalf of any of, or to act on behalf of or bind, the other Parties hereto.

4.     MANAGEMENT OF THE COMPANY

4.1     Management of the Company - The Board shall be responsible for managing and determining the policies, business and affairs of the Company and shall be entitled to exercise all such powers of the Company as are not, in accordance with Applicable Law, required to be exercised by the shareholders of the Company in a general meeting.  Without limiting the generality of the foregoing, the Board shall be responsible for (i) making all decisions with respect to the Business, (ii) carrying out and overseeing those matters for which it is responsible in accordance with this Agreement, (iii) monitoring compliance with all Approved Work Programmes and Budgets and (iv) monitoring compliance with the applicable Services Agreement.

4.2     Board of Officers - The day to day operations of the Company shall be the responsibility of (i) the Board of Officers of the Company (as elected pursuant to Clause 3.1.3), who shall perform such functions in accordance with the duties and powers set out in the Articles and By-Laws (New) and in accordance with Applicable Law, and (ii) the Manager under and in accordance with the terms of the Services Agreement.

4.3     Approvals during Earn-in Phases - Notwithstanding Clause 4.1, provided APB is Sole Funding Approved Expenditures, no proposed Work Programme and Budget shall be approved by the Board without the express written consent of APB to such proposed Work Programme and Budget. 

4.4     Services Companies and Manager - The Parties acknowledge that unless otherwise approved by the Board, all work under Approved Work Programmes and Budgets shall be carried out by the Manager pursuant to the relevant Service Agreement. AML shall be the first Manager.  APB may, at its discretion, elect to replace AML as Manager at any time after 

14

<PAGE>

the Second Option Exercise Date and shall, unless otherwise approved by the Board, become Manager on the Final Earn-in Date.  In the event that APB elects to become Manager or becomes Manager in accordance with the terms of this Agreement, APB shall procure that the relevant member of the APB Group enters into a Service Agreement.

4.5     AML Services Agreement - Prior to the Second Option Exercise Date, no decision of the Board shall be taken in relation to any Company consent requirements under the terms of the AML Services Agreement, without the express written consent of APB.

5.     COMPOSITION AND PROCEEDINGS OF THE BOARD

5.1     Initial Composition of Board - Prior to the Third Option Exercise Date:
5.1.1     the Board shall consist of four Directors, two of which shall be APB Directors and two of which shall be AML Directors;

5.1.2     subject to Clause 5.1.3, the Chairman of the Board shall be appointed by the Board initially from amongst the AML Directors and thereafter the Chairmanship shall be rotated amongst the APB Directors, on the one hand, and the AML Directors, on the other hand, every 12 months, and any Chairman appointed under this Clause 5.1.2 shall not have a casting vote; and

5.1.3     on and after the Second Option Exercise Date, the Chairman of the Board shall be appointed by the Board from amongst the APB Directors (as specified by notice given by APB from time to time to each of the other Parties) and such Chairman shall have a casting vote.

5.2     Adjustment to Composition of Board - On and after the Third Option Exercise Date, and subject to Clause 5.12, the Board shall consist of a minimum of four and a maximum of six Directors, the majority of which, in each case, shall be APB Directors. Provided a Shareholder holds at least a Shareholding of 30%, it shall be entitled to a minimum of two directors.

5.3     Quorum - A quorum for the transaction of any business at Board Meetings shall be initially at least two APB Directors and at least two AML Directors, but on and after the Third Option Exercise Date, a quorum for the transaction of any business at Board Meetings shall be at least three APB Directors and at least one AML Director.  Notwithstanding the foregoing, if within 60 minutes after the time scheduled for a Board Meeting a quorum is not present because the requisite number of APB Directors or AML Director(s) is not in attendance or if during such meeting a quorum ceases to be present, then (a) the Board Meeting shall be adjourned to the same time on the date which is seven Business Days thereafter at the same place and time or such other time and/or date as all Shareholders agree, (b) notice of the adjourned Board meeting shall be given to all Shareholders and (c) at such adjourned Board Meeting the quorum will be any two Directors.

5.4     Alternate Directors - Each Director may have an alternate (who may be another Director) to represent such Director on the Board in such person's absence provided that such alternate director has been duly identified and/or appointed in accordance with the terms of the Articles and By-Laws (New) and Applicable Law.  A Director shall, for the purpose of this Agreement, be regarded as being present at a Board Meeting if he or she is represented by an alternate director duly appointed in accordance with the terms of the Articles and By-Laws (New) and Applicable Law.

5.5     Role of Chairman - The Chairman of the Board for the time being shall preside at Board Meetings.  In the event the serving Chairman of the Board is unable to attend or act at any Board Meeting, the Board shall nominate one of their number to serve as acting Chairman at such meeting and such nominee shall have all of the rights and powers of the serving Chairman hereunder at such meeting; provided that such acting Chairman shall be selected from the Directors nominated and appointed by the Party who appointed the serving Chairman.

15

<PAGE>

5.6     Role of Secretary - The Chairman shall appoint a secretary.  The secretary, acting under the direction of the Chairman, shall give not less than 14 days' prior notice (or such lesser period of notice as may be consented to in writing by at least one APB Director and one AML Director) to the Directors of any scheduled or proposed Board Meeting, shall duly record the minutes of all Board Meetings and shall distribute such minutes to each of the Directors and the Shareholders, and shall have such other powers and duties as the Board may determine from time to time.  If none of the Directors nominated and appointed by a Shareholder gives notice of any changes that it believes should be made to the minutes within 21 days of receipt of the minutes, all Directors nominated and appointed by such Shareholder shall be deemed to have approved those minutes.

5.7     Power to Replace Directors - Each of APB and AML shall be entitled from time to time by notice to the Chairman of the Board and the other of them to call for a Shareholders' meeting in order to remove any APB Director or AML Director, respectively, and to replace any person who is so removed or who ceases for any other reason to be a APB Director or AML Director, respectively.

5.8     Meetings of Board - The Board will meet at least quarterly provided that either of APB or AML shall be entitled to convene a Board Meeting by giving at least          14 Business Days' prior notice (or such lesser period of notice as may be consented to in writing by at least one APB Director and one AML Director) to the secretary appointed in accordance with Clause 5.6.  Unless otherwise decided by the Board, Board Meetings shall be held in Brazil and may be attended by Directors by means of electronic means of communication through which each Director so attending may hear and be heard by all the other Directors so attending.

5.9     Observers - In addition to the Directors nominated by it, each Shareholder shall be entitled to have up to three observers present at each Board meeting.

5.10     Simple Majority - Subject to Clause 4.2 and Article 6, resolutions proposed at Board Meetings shall be valid if passed by a simple majority of votes (including any casting vote of the Chairman permitted to be cast in accordance with this Agreement).  Each Director shall have a single vote, provided that where so provided in this Article 5 the Chairman shall also have a casting vote.  

5.11     Deadlocks - If and whenever:
5.11.1     any Further Work Programme and Budget has not been approved by the Board in accordance with this Agreement prior to the commencement of the period to which such Work Programme and Budget relates; and/or

5.11.2     the Board fails, in two consecutive meetings of the Board, to approve any matter referred to in Article 6, 

such matter shall be referred for resolution in accordance with Clause 27.2 unless otherwise agreed by all the Shareholders (but shall not be subject to arbitration in accordance with Clause 27.3).  

5.12     Right to Appoint Directors - Notwithstanding the provisions of Clauses 5.1 and 5.2, if at any time after the Second Option Exercise Date, (i) the Shareholding of any Shareholder falls below 10%, such Shareholder shall not be entitled to appoint or maintain in office any Director, and (ii) APB does not exercise the Third Option, the Board shall appoint one of the AML Directors as Chairman of the Board and such Chairman shall have a casting vote.

6.     APPROVAL OF RESERVED MATTERS

6.1     Approval of Reserved Matters - No decision of the Board, nor any decision of the Board of Officers of the Company nor any decision or resolution of the shareholders of the Company shall be of any force or effect in respect of any of the Reserved Matters, and the Parties shall do all acts and things necessary (including exercising voting rights attaching to 

16

<PAGE>

Shares held (or controlled) by them and exercising their right to nominate and terminate the appointment of Directors) to ensure that no action is taken by the Company with respect to any of the Reserved Matters without the unanimous consent of all of the Shareholders save in respect of paragraphs (e), (i) and (j) of the definition of Reserved Matters which will require the unanimous approval of the Board; provided that if at any time after the Second Option Exercise Date, a Shareholder's Shareholding is below 20%, paragraphs (b), (d), (e), (h), (i) and (k) shall not be considered to form part of the definition of Reserved Matters under this Agreement.   

7.     SHAREHOLDER MEETINGS

7.1     Shareholders Meetings - Meetings of shareholders of the Company shall be held not less frequently than is required under Applicable Law and including for the purpose of the subscription for and issuance of Shares as provided herein.

7.2     Place of Meetings - Meetings of shareholders of the Company shall be held in Brazil (in the City where the registered office of the Company is). Each of the Shareholders (or its representative or proxy present at such meeting) may invite up to three observers to be present at any meeting of shareholders of the Company.

7.3     Quorum - The quorum for any meeting of shareholders of the Company shall consist of the minimum number of shareholders of the Company as may be required to constitute a quorum for such meeting under applicable Law which number shall include all of the Shareholders (or their representatives) in attendance or represented by proxy;  provided that if at any time scheduled for a meeting a quorum is not present including because one Shareholder is not represented, then (i) the meeting shall be adjourned by the shareholders present to the same time on the date which is two Business Days thereafter or such other time and/or date as all Shareholders agree, (ii) notice of the adjourned meeting shall be given to all shareholders and (iii) at such adjourned meeting, the quorum shall consist of any one or more shareholders in attendance or represented by proxy.

7.4     Notice of Meeting - Each notice of a meeting of shareholders of the Company shall contain or be accompanied by an agenda of all material matters proposed to be raised at the meeting, together with or referring to previously distributed appropriate supporting material.  Only those matters of business referred to in the applicable notice or agenda may be voted on at a meeting of shareholders, unless all Shareholders (or their representatives) are present or represented by proxy at the meeting and so consent.

8.     WORK PROGRAMMES AND BUDGETS

8.1     Work in Accordance with Approved Work Programmes and Budgets - No work shall be conducted or undertaken nor shall any Expenditure be incurred or funded by the Company (either directly or indirectly through its employees, directors, officers or agents, including the Manager), unless such work or Expenditure is contemplated by an Approved Work Programme and Budget and otherwise complies with the provisions of this Agreement.  The Parties agree and acknowledge that the Initial Work Programme and Budget was agreed by the Parties pursuant to the terms of the Framework Agreement and shall constitute an Approved Work Programme and Budget for the purposes of this Agreement.

8.2     Submission of Proposed Work Programmes and Budgets - Unless otherwise approved by the Board:
8.2.1     the Second Work Programme and Budget and, subject to Clause 8.2.2, the Third Work Programme and Budget shall be prepared by AML as Manager under the terms of the AML Services Agreement and in the case of the Second Work Programme and Budget and the Third Work Programme and Budget, submitted to the Board for approval in accordance with Clause 8.6; 

17

<PAGE>
8.2.2     in the event APB elects to become Manager from the Second Option Exercise Date, the Third Work Programme and Budget shall be prepared by APB as Manager and submitted to the Board for approval in accordance with Clause 8.6; and

8.2.3     all proposed Work Programmes and Budgets (other than those referred to in Clauses 8.2.1 and 8.2.2) shall be prepared by APB as Manager and submitted to the Board for approval.

8.3     Conduct of Work by Service Companies - Unless otherwise approved by the Board:
8.3.1     all work under Approved Work Programmes and Budgets prepared by AML pursuant to Clause 8.2.1 shall be conducted by the AML Service Company pursuant to the AML Services Agreement (unless such agreement shall have been terminated in accordance with its terms, in which event such work shall, unless otherwise determined by the Board, be conducted by the Company); and

8.3.2     from and after the date APB elects to become Manager or becomes Manager under the terms of this Agreement, all work under Approved Work Programmes and Budgets relating to Pedra Branca Project shall be conducted by the APB Group pursuant to a Services Agreement (unless such agreement shall have been terminated in accordance with its terms, in which event such work shall, unless otherwise determined by the Board, be conducted by the Company). 

8.4     Purpose of Work Programmes and Budgets during Exploration Phase - The Parties hereby expressly agree that the purpose of Initial Work Programme and Budget, the Second Work Programme and Budget and the Third Work Programme and Budget relating to the Exploration Phase of the Pedra Branca Project shall be to evaluate the global tonnage potential of the Project Area and to evaluate the optimal exploitation potential of the Project Area.

8.5     Initial Proposed Work Programme and Budget - The Parties acknowledge and agree that pursuant to the terms of the Framework Agreement, the initial Work Programme and Budget (the "Initial Work Programme and Budget") was agreed and that certain aspects of such Work Programme and Budget have been implemented under and in accordance with the terms of the Framework Agreement.  Such Initial Work Programme and Budget is attached hereto as Schedule 3, Part A (Initial Work Programme and Budget), for further reference.  The Parties acknowledge and agree that prior to the Effective Date, approximately US$ 256,153 (two hundred and fifty-six thousand, one hundred and fifty-three United States Dollars) of the work set out in the Initial Work Programme and Budget has been funded by the APB Group and implemented by the AML Group pursuant to and in accordance with the terms of the Framework Agreement. Details of the work so funded are contained in Schedule 3 (Actual Work and Expenditure), Part B. The remaining work provided for in the Initial Work Programme and Budget, estimated to be approximately US$ 966,140 (nine hundred and sixty-six thousand, one hundred and forty United States Dollars), shall be implemented by AML under the terms of the AML Services Agreement.   

8.6     Second Work Programme and Budget and Third Work Programme and Budget  - Subject to Clause 10.9.5, AML and, if applicable, APB shall procure that the Manager delivers to the Board a proposed second Work Programme and Budget (the "Second Work Programme and Budget") in relation to the proposed Second Earn-in Period and a proposed third Work Programme and Budget (the "Third Work Programme and Budget") in relation to the proposed Third Earn-in Period:
8.6.1     in the event of the Second Work Programme and Budget not later than 60 days prior to the end of the work/budget period set out in the Initial Work Programme and Budget; and 

18

<PAGE>
8.6.2     in the event of the Third Work Programme and Budget not later than 60 days prior to the end of the work/budget period set out in the Second Work Programme and Budget,

which Work Programmes and Budgets shall be considered and, if applicable, approved, by the Board and APB in accordance with the terms of this Agreement.    

8.7     Further Work Programmes and Budgets -  Each Party shall prepare and submit to the Board for approval such further Work Programmes and Budgets as it, in its capacity as Manager, is responsible for preparing in accordance with Clause 8.2 covering all proposed works and Expenditures proposed to be undertaken, incurred or funded by the Company in connection with the Pedra Branca Project following the completion of the Initial Work Programme and Budget, the Second Work Programme and Budget and the Third Work Programme and Budget (each such further Work Programme and Budget, a "Further Work Programme and Budget").  The Company shall procure that such Further Work Programmes and Budgets are presented for consideration by the Board (i) during the Exploration Phase, by not later than 60 days prior to and (ii) during the Mining Phase, by not later than 90 days prior to, the end of the Work Programme and Budget then in place and that such proposed Further Work Programmes and Budgets are accompanied by a detailed report in respect of the then current Work Programme and Budget period, including without limitation those matters stipulated in the AML Service Agreement (and any subsequent Services Agreements) as reporting obligations.  The Parties shall use their reasonable efforts to procure that the Board approves all Further Work Programmes and Budgets (with such amendments or modifications thereto as may be approved by the Board) in a timely manner and in any event (i) during the Exploration Phase, within 60 days of receipt by the Board of such proposed Work Programme and Budget, and (ii) during the Mining Phase, within 90 days of receipt by the Board of such proposed Work Programme and Budget.

8.8     Content of Work Programmes and Budgets - Each Work Programme and Budget proposed by the Manager, a Party hereto or approved by the Board shall set out, in reasonable detail, the following:
8.8.1     the timing, nature and amounts of all Operating Expenditures and Capital Expenditures to be incurred or funded by the Company, including, for certainty, (i) any and all Expenditures required for the maintenance of the  Properties under Applicable Law, and (ii) any and all Expenditures required in connection with required restoration and reclamation of the Property under Applicable Law or otherwise, and posting any bond (whether cash or surety) required in that regard by any Government Authority;

8.8.2     the period of time to which such Work Programme and Budget relates provided that the period of time to which each of the Second Work Programme and Budget and the Third Work Programme and Budget relates shall be no longer than 14 months (it being understood that the work period shall be for 12 months and the remaining two months are for review and approval of the proposed Work Programme and Budget for the next ensuing period, as provided for in Clause 8.6); 

8.8.3     a period of time incorporated for the evaluation and approval of any proposed Work Programme and Budget subsequent to the Third Work Programme and Budget, which period shall extend beyond the work period provided for in such Work Programme and Budget for the undertaking of Exploration or Mining by (i) a minimum of 60 Business Days during the Exploration Phase, and (ii) a minimum of 90 Business Days during the Mining Phase; and

8.8.4     such other information as the Board shall require.

19

<PAGE>
8.9     Board Preparation of Work Programmes and Budgets  Notwithstanding the foregoing and the terms of the Services Agreement, the Board shall retain the discretion to prepare a Work Programme and Budget as it, in its sole discretion, deems appropriate in circumstances where (i) the Board has not approved a proposed Work Programme and Budget prepared by the Manager for any reason, (ii) amendments or changes to an Approved Work Programme and Budget are required, or (iii) no Manager has been appointed.  If the Board for any reason fails to adopt a Work Programme and Budget, the Manager shall continue Operations at levels sufficient to maintain the Properties in good standing for a maximum period of six months.  Should the Board for any reason fail to adopt a Work Programme and Budget during the Mining Phase subsequent to the initial Approved Work Programme and Budget during such phase, and subject to contrary direction of the Board and the receipt of necessary funds, the Manager shall continue Operations at levels comparable with the last adopted Approved Work Programme and Budget during such Mining Phase for a maximum period of six months.  

8.10     Budget Overruns - The Company shall ensure that the terms of the applicable Services Agreement provide that the Manager shall not exceed the budget in an Approved Work Programme and Budget by more than 10% (ten percent) unless expressly authorised by the Board prior to incurring Expenditures to fund such overrun.  Budget overruns in excess of 10% which are approved by the Board shall constitute expenditures under an Approved Work Programme and Budget and be paid out of funds from Operations or shall, subject to any Sole Funding, be borne by the Shareholders in proportion to their respective Ownership Interests at the time the permitted or approved overrun occurs.  Any such funded expenditures incurred by the Manager under the applicable Services Agreement shall constitute Allowable Expenditures.

9.     DECISION TO UNDERTAKE MINING
The Company shall not undertake any Mining activities on the Properties or in the Project Area or otherwise on or in connection with the Pedra Branca Project (or part thereof), unless, prior thereto, APB or AML shall have delivered to the Board a formal proposal in respect of thereof together with such supporting information, including without limitation a Mining Feasibility Study supporting such proposal, as the Board shall require, and the Board shall have approved such proposal. 

10.     FUNDING OF PEDRA BRANCA PROJECT

10.1     Funding Prior to the Final Earn-in Date - Prior to the Final Earn-in Date and subject to Clause 10.9, APB shall make Advances (at the times and in the manner determined by the Board) in order to fund all Approved Expenditures in connection with the Exploration Phase of the Pedra Branca Project as follows;
10.1.1     a maximum of US$ 2,250,000 in respect of the First Earn-in Period;

10.1.2     a maximum of US$ 1,750,000 in respect of the Second Earn-in Period; and

10.1.3     a maximum of US$ 3,000,000 in respect of the Third Earn-in Period;

up to a maximum aggregate of US$ 7,000,000, provided always that if the conduct of Work Programmes and Budgets is constrained due to operational delays or Work Programmes and Budgets for the relevant earn-in period provide for funding requirements less than the maximum amounts set out in this Clause 10.1, either by decision of the Board under Approved Work Programmes and Budgets or because of reasons beyond APB's reasonable control, such that funding at the maximum rates set out above is not required, then the spend requirement shall be reduced accordingly and provided further that APB shall be deemed to have met its funding obligations under this Clause 10.1 with such reduced spend requirements and shall qualify to 

20

<PAGE>
exercise the relevant Earn-in Option under Clause 13 in accordance with the terms of this Agreement.  Subject to Clause 10.9 and prior to the Final Earn-in Date, any expenditure shortfall in relation to the funding required for the relevant earn-in period under this Clause 10.1 shall be carried forward to the next applicable earn-in period and the Second Work Programme and Budget or the Third Work Programme and Budget, as applicable, shall be adjusted accordingly.  The Parties confirm Clause 3.2 and expressly agree that the remaining funding requirement of APB in relation to the First Earn-In Period shall be US$ 2,250,000 less the Eligible Initial Investment Costs. 

10.2     Funding On and After the Final Earn-in Date - On and after the earlier of (i) the date APB ceases Sole Funding in accordance with Clause 10.9, and (ii) the Final Earn-in Date, and subject to Clause 10.3 and Clause 10.6, APB and AML shall make Advances (at the times and in the manner determined by the Board) in order to fund Approved Expenditures in connection with the Pedra Branca Project pro rata in accordance with their respective Ownership Interests.  

10.3     Funding of Feasibility Option - If APB elects under Clause 14.3 to pursue the Feasibility Option, APB shall, subject to Clause 10.9, make Advances (at the times and in the manner determined by the Board) in order to fund all Approved Expenditures required during the Feasibility Period in connection with the Pedra Branca Project.  APB shall procure that its Board nominees act at all times in such a manner so as to enable completion of the relevant Mining Feasibility Study prior to the date that is 18 months from the Feasibility Election Date.  

10.4     Form of Advances - All Advances required under this Agreement shall, unless otherwise agreed between APB and AML, be made in the form of cash by way of advancements on account of equity subscriptions (for purposes of this Agreement, such Advances in this Clause 10.4 being referred to as "Required Shareholder Funding") and shall be made in such form as Advances for Future Capitalization.  Unless the form of advances changes as contemplated above, the Parties agree that all such Advances for Future Capitalization are amounts that have been irrevocably committed by the relevant funding party to increase capital in the Company. The Parties acknowledge that tax considerations and implications for each of the Shareholders and the Company may impact how the Shareholders and the Company structure the funding obligations hereunder and agree that they will at all times take such considerations in respect of all such parties into account in determining whether the form of Advances shall be by means of capital contributions, contributed surplus or Shareholder loans.  

10.5     Cash Calls - the Company shall, not less than 21 days prior to the commencement of each quarter in respect of which Approved Expenditures will be incurred, by notice in writing to APB and/or AML (each, a "Cash Call") demand that such Party make such Advances as such Party is required to make in accordance with this Clause 10.  Advances validly demanded pursuant to each Cash Call shall be made by the relevant Party not later than five days before the beginning of the relevant quarter to be funded.  The amount of each cash call shall be in accordance with the then applicable Approved Work Programme and Budget, provided however that the Company may make adjustments to any Cash Call schedule provided for in an Approved Work Programme and Budget due to the normal timing differences (acceleration or delay of specific work items under the implementation of Approved Work Programmes and Budgets) that may occur within a quarter.  The Company will provide an explanation for any such adjustments to the Shareholders as part of the applicable Cash Call. 

21

<PAGE>

10.6     Election to Fund an Approved Work Programme and Budget - Subject to the Sole Funding provisions of this Agreement, the Board shall determine the extent to which and the sources from which funds shall be required to fund an Approved Work Programme and Budget.  In making such determination, the Board shall, if applicable, consider financing and operating cash flows before funding by contribution from Shareholders.  If an Approved Work Programme and Budget is to be funded by contributions from Shareholders, each Shareholder shall, by notice to the Board within 20 Business Days after receipt of such Approved Work Programme and Budget, elect to contribute to such Approved Work Programme and Budget:
10.6.1     in proportion to its Ownership Interest as of the beginning of the budget period covered by the Approved Work Programme and Budget;

10.6.2     in some lesser amount than in proportion to its Ownership Interest as of the beginning of the budget period covered by the Approved Work Programme and Budget; or

10.6.3     not at all.

If a Shareholder elects to participate in an amount less than in proportion to its Ownership Interest, or not at all, its Ownership Interest shall be recalculated, as at the date that the Shareholder makes its election, in accordance with Clause 11.6.  If a Shareholder fails to notify the Board of its election with respect to such an Approved Work Programme and Budget within such 30 day period, the Shareholder shall be deemed to have elected not to contribute at all to such Approved Work Programme and Budget and that Shareholders Ownership Interest shall be recalculated accordingly. 

10.7     Approved Work Programme and Budget to be Fully Subscribed - If, following all elections having been made pursuant to Clause 10.6, an Approved Work Programme and Budget is not fully subscribed, then a Shareholder which has fully subscribed shall have a period of 10 Business Days to elect to contribute to that portion of the Approved Work Programme and Budget then not subscribed for, proportionate to its Ownership Interest, unless the Shareholders who have fully subscribed agree otherwise.  This procedure shall be repeated as often as is necessary until the Approved Work Programme and Budget is fully subscribed or until no subscribing Shareholder remains who is willing to subscribe for the whole of the unsubscribed portion of the Approved Work Programme and Budget.  If the Shareholders who have fully subscribed elect to do so, the Ownership Interests of the Shareholders who have not shall be recalculated, as at the date of such further subscription, in accordance with Clause 11.6.  If such Approved Work Programme and Budget is still not fully subscribed, then the Board shall curtail or modify the Approved Work Programme and Budget to be consistent with the level of funding subscribed by the Shareholders.  The Company shall not proceed with an Approved Work Programme and Budget which is not fully subscribed.

10.8     Failure to Advance Required Shareholder Funding - The Shareholders acknowledge that, if a Shareholder fails to advance any Required Shareholder Funding when due pursuant to a Cash Call (a "Funding Default"), it will be difficult to measure the damages resulting there from.  If a Shareholder fails to Advance the Required Shareholder Funding, the Company shall give notice to such defaulting Shareholder and, if such failure is not cured within 30 Business Days after delivery of such notice of default, the non-defaulting Shareholder may elect one of the following remedies by giving notice of such election to the defaulting Shareholder and the Company:
10.8.1     the non-defaulting Shareholder may elect, but shall have no obligation, to advance or cause to be advanced to the Company on behalf of the defaulting Shareholder, in the same manner as the other Advances to be made by the 

22

<PAGE>
Shareholders in respect of such Cash Call, the full amount of the defaulted contribution and treat the same, together with any accrued Default Interest, as a loan to the defaulting Shareholder (a "Default Loan") due 20 Business Days after demand and bearing interest in an amount equal to the Default Interest.  A Default Loan and any security interest relating thereto shall be subordinate to financing or any other secured debt, unless otherwise agreed by the creditor of any such financing or other secured debt.  The non-defaulting Shareholder shall evidence such subordination by such instruments as such creditor may reasonably request.  Failure to repay any Default Loan shall entitle the non-defaulting Shareholder to enforce the security for the loan and to exercise the rights provided in Clause 10.8.2.  Each Shareholder hereby grants to the other Shareholder a lien upon all of its Interests and a pledge of and security interest in such Interests and in any dividends or other distributions made in respect of such Interests, as security for any Default Loan made hereunder, including interest thereon, reasonable attorneys fees and all other reasonable costs and expenses incurred in recovering the Default Loan with interest and in enforcing such lien, pledge, or security interest, or both, but in all cases subordinated to any financing or other secured debt now or hereafter incurred by the Company, as provided above; or

10.8.2     the non-defaulting Shareholder may elect, by notice to the defaulting Shareholder at any time after 30 Business Days subsequent to expiration of the cure period provided in this Clause 10.8 or after 30 Business Days subsequent to failure to repay a Default Loan, whichever is later, to have the defaulting Shareholder's Ownership Interest reduced in accordance with Clause 11.7.  For such purposes, all amounts treated as a loan pursuant to Clause 10.8.1 and interest thereon shall be included in the calculation of the defaulting Shareholder's reduced Ownership Interest as contributions made by the non-defaulting Shareholder.  The non-defaulting Shareholder's Ownership Interest shall, at such time, become the difference between 100% and the further reduced Ownership Interest and, for the purposes of the definition of Ownership Interest, the level of its contributions shall be deemed to have increased as necessary to reflect the new Ownership Interests. Such adjustments to Ownership Interests shall be effective as of the date of the default.  In such event, the non-defaulting Shareholder undertakes not to realise any security it acquired pursuant to Clause 10.8.1.

10.9     APB Election to Cease Sole Funding - APB may, at its sole discretion, elect to cease Sole Funding under Clause 10.1 and/or, if applicable, Clause 10.3 at any time during the relevant earn-in or funding period, provided however:
10.9.1     if APB ceases to Sole Fund prior to the First Option Exercise Date, APB shall have no rights and Interests in the Pedra Branca Project, whether through a shareholding in the Company or an Ownership Interest or otherwise and this Agreement shall terminate; 

10.9.2     if APB ceases to Sole Fund prior to the Final Earn-In Date and is the Manager pursuant to an election made in accordance with Clause 4.4, it shall cease to become Manager and AML shall replace APB as Manager from the date of election hereunder;

10.9.3     the relevant Option to which the funding period relates in respect of which APB has elected to cease Sole Funding shall terminate and APB shall have no entitlement to any additional Shares as a result of partial funding of the applicable Option;  

23

<PAGE>
10.9.4     any Option not exercised prior to the date APB elects to cease Sole Funding shall terminate; and

10.9.5     the then current Approved Work Programme and Budget shall terminate and the Company shall procure that the Manager immediately propose a revised Work Programme and Budget, which Work Programme and Budget shall be presented for consideration by the Board and, if approved, shall constitute an Approved Work Programme and Budget for all purposes of this Agreement.    

10.10     Emergency Funding - Notwithstanding anything in this Agreement, the Company may at any time incur, and may require the Shareholders to fund, Allowable Expenditures that the Manager determines (acting reasonably), and the Board agrees, are necessary to protect life or property or the assets of the Company or to comply with Applicable Laws without an Approved Work Programme and Budget.  The Company shall promptly notify the Shareholders of the occurrence of any of the circumstances referred to herein. Upon receipt of an emergency cash call made on written notice by the Company and delivered to the Shareholders in accordance with this Agreement, the Shareholders shall advance any funding referred to in this Clause 10.10 and requested in such emergency cash call, pro rata to their respective Shareholdings on the date specified in such emergency cash call. 

11.     OWNERSHIP INTERESTS AND SHAREHOLDINGS

11.1     Shareholding to Equal Ownership Interest - It is the intention of the Parties that, subject to the Shareholding of APB prior to the First Option Exercise Date, which Shareholding shall be deemed to be 1%,  the Shareholding of each Party shall at all times be equal to the Ownership Interest of such Party, in each case as determined in accordance with this Agreement.

11.2     Determination of Ownership Interest - The Ownership Interests of each Shareholder shall be determined in accordance with the provisions of this Agreement provided, however, that (i) prior to the First Option Exercise Date APB's Ownership Interest shall be as provided for in Clause 11.1 and AML's Ownership Interest shall be 100% less APB's deemed Ownership Interest as aforesaid, (ii) prior to the Final Earn-in Date, APB's Ownership Interest shall be increased only as provided for in Clause 13, (iii) upon the exercise of the Feasibility Option, the Ownership Interest of APB shall be deemed to be 60%, and (iv) upon the exercise of the Finance Option, the Ownership Interest of APB shall be deemed to be 65%. 

11.3     Changes in Ownership Interest as between Shareholders  - A Shareholder's Ownership Interest shall be changed:
11.3.1     upon the exercise of any one of the Options pursuant to the terms of this Agreement;

11.3.2     if an Event of Default occurs and the provisions of Article 29 are invoked;

11.3.3     as provided for in Clauses 11.6, 11.7 and 11.8; and 

11.3.4     upon a transfer by a Shareholder of its Shares in accordance with Clause 28.2.

11.4     Adjustments to Shareholdings - If the Ownership Interests change, and the Shareholding held by APB or AML is not equal to its Ownership Interest, the Shareholders shall procure that and the Company shall, as applicable,  (i) issue additional Shares at their par value to the Shareholder (an "Increasing Shareholder") whose Shareholding is less than its Ownership Interest, and/or (ii) consent to any transfers of Shares as may be implemented as contemplated under this Agreement, in either case so that the total number of issued Shares held by the Increasing Shareholder is such that the new Shareholdings correspond with the changed Ownership Interest.

24

<PAGE>

11.5     Notification of Change in Shareholdings - The Company shall, as soon as practicable following the exercise of any Option or any other share adjustment pursuant to Clause 11.4 and upon written request of a Shareholder from time to time, confirm to each of the Shareholders in writing (i) the number of Shares that are held by each Shareholder and the total number of issued Shares, (ii) that all of the Shares referred to in (i) above have been validly issued by the Company and credited as fully paid and (iii) that the Shares referred to in (i) above have been registered in the Company's share register.

11.6     Voluntary Reduction in Ownership Interest - If a Shareholder elects pursuant to Clause 10.6 to contribute to an Approved Work Programme and Budget in some lesser amount than its Ownership Interest, or not at all, the Ownership Interest of that Shareholder (the "Reducing Shareholder") shall be recalculated at the time of election in accordance with the following formula:

	
X =
	
A

	 	
A + +* D -E)* F

           where:
"X"     is the Reducing Shareholder's reduced Ownership Interest.

"A"     is the aggregate of (i) the total of the Reducing Shareholder's actual contributions to the Company after the date of the Letter Agreement, (ii) the Reducing Shareholder's Initial Contribution, and (iii) the amount, if any, the Reducing Shareholder elects to contribute to the Approved Work Programme and Budget.

"B"     is the aggregate of (i) the total of the non-Reducing Shareholder's actual contributions to the Company after the date of the Letter Agreement, (ii) the Non-Reducing Shareholder's Initial Contribution, and (iii) the amount the non-Reducing Shareholder elects to contribute to the Approved Work Programme and Budget.

"C"     is the Reducing Shareholder's Ownership Interest at the date of election to contribute to the Approved Work Programme and Budget.

"D"     is the amount all Shareholders have elected to contribute to the Approved Work Programme and Budget.

"E"     is the amount, if any, the Reducing Shareholder elects to contribute to the Approved Work Programme and Budget.

"F"     is 0.2.

11.7     Reduction in Ownership Interest on Funding Failure - A Shareholder who has failed to advance Required Shareholder Funding or defaults in repayment of a Default Loan, shall if the non-defaulting Shareholder has made an election under Clause 10.8.2, have its Ownership Interest recalculated at the time of election by the non-defaulting Shareholder in accordance with the formula set out in Clause 11.6 provided that for this purpose, "F" shall equal 1.0 and not 0.2. 

11.8     Elimination of Minority Interest - Upon reduction of its Ownership Interest to less than 10%, the Reducing Shareholder shall be deemed to have offered to sell all Interests owned or held by such Reducing Shareholder (the "Offered Interest") to the other Shareholder for:
11.8.1     an amount equal to the Historical Cost if the Reducing Shareholder's Ownership Interest decreases below 10% prior to the completion of the first Mining Feasibility Study, or 

11.8.2     an amount equal to 100% of the Fair Value if the Reducing Shareholders' Ownership Interest decreases below 10% after the completion of the first Mining Feasibility Study.

25

<PAGE>
The Parties agree that the Historical Cost or the Fair Value, as applicable, shall be determined within 60 days of the deemed offer pursuant to this Clause 11.8 and that subsequent to such determination, the other Shareholder shall, in the case of a sale of Offered Interest at Historical Cost, have 45 days within which to accept the offer to sell the Offered Interest, and, in the case of a sale of Offered Interest at Fair Value, have 90 days to accept the offer to sell the Offered Interest.  In the event the offer to sell the Offered Interest is accepted, the transfer effecting the sale of the Offered Interest shall be completed in accordance with the Transfer and Subscription Terms.  Upon completion of such transfer, the former Shareholder shall have no Ownership Interest in, or any rights with respect to, the Company, the Properties or the Pedra Branca Project.  In the event the offer to sell the Offered Interest is not accepted as contemplated hereunder, the Reducing Shareholder shall retain its Ownership Interest and all rights and obligations relating thereto under this Agreement.

12.     COMPANY LOANS

12.1     Issuance of Company Loans - Should the Parties unanimously agree, in accordance with the terms of this Agreement, to fund Advances by way of Shareholders' loans, such loans shall be evidenced by Company Loan Notes. 

12.2     Repayment of the Company Loans - No holder of a Company Loan Note shall be entitled to demand, and the Company shall not make, payment of any Indebtedness under any Company Loan Note unless (i) payment is made in compliance with any distribution policy adopted by the Board in accordance with this Agreement, and (ii) the holder of the majority principal amount of Aggregate Indebtedness evidenced by the Company Loan Notes outstanding at such time has consented to such demand and payment.

12.3     Transfer of the Company Loan Notes with Shares - The Parties agree that upon the transfer  by a Party (referred to in this Clause as the "transferor") of any Shares pursuant to the terms of this Agreement to any Party (referred to in this Clause as the "transferee"), a corresponding amount of the Indebtedness evidenced by the Company Loan Notes representing the percentage of such Indebtedness which is equal to such percentage of Shares being transferred, shall be deemed to be simultaneously transferred to the transferee.  The Company shall cancel and, if applicable, reissue in a lower face value any Company Loan Notes to evidence the reduction of Indebtedness owing to the transferor and reissue in the name of the transferee a Company Loan Note to evidence the increase in Indebtedness owing to the transferee.

13.     APB'S EARN-IN OPTIONS

13.1     APB Earn-in Options - AML shall procure that the Company grants and the Company hereby grants to APB (and/or to such other member or members of the APB Group as may from time to time be nominated by APB by notice in writing from APB) the following exclusive options (collectively the "Earn-in Options") to subscribe for, with effect on the date of exercise of the relevant Earn-in Option, the relevant number of  Shares:
13.1.1     the option to acquire the First 15% Shares (the "First Option");

13.1.2     the option to acquire the Second 15% Shares (the "Second Option"); and

13.1.3     the option to acquire the Further 21% Shares (the "Third Option"). 

13.2     Exercise of Option - The Earn-in Options, respectively, shall be deemed to have been exercised by APB immediately on:
13.2.1     in respect of the First Option, the First Option Exercise Date:

13.2.2     in respect of the Second Option, the Second Option Exercise Date; and

13.2.3     in respect of the Third Option, the Third Option Exercise Date.

13.3     Subscription of Shares with Ownership Interest - On the relevant exercise date APB (and/or to such other member of the APB Group as may be nominated by APB by notice in writing from APB) shall subscribe for such number of Shares (as applicable, the "First 15% 

26

<PAGE>

Shares", the "Second 15% Shares" or the "Further 21% Shares", and collectively, the "Earn-In Shares" ) as will represent, at the date of exercise of the relevant Option, 15%, 15% and 21%, respectively, of the issued Shares in the capital of the Company as at that date and the Shareholders shall procure that and the Company shall issue such Earn-In Shares, as applicable, to APB.  APB (and/or such other member of the APB Group as may be nominated by APB by notice in writing from APB) shall be deemed to have increased its corresponding percentage Ownership Interest by the relevant percentage and no further consideration shall be payable in respect of the increase in such Ownership Interest.  If required by APB or under Applicable Law, the Company shall execute such separate subscription option agreement or other instrument evidencing the relevant Earn-in Option as may be reasonably required by APB, which agreement or other instrument shall contain terms and conditions which are consistent with this Article 13 and the Transfer and Subscription Terms and such other terms and conditions as are customarily included in such agreements or instruments. 

13.4     Subscription Price for Earn-in Shares  The purchase price for the relevant percentage of Shares acquired from time to time upon each of the relevant exercise dates shall be deemed to have been satisfied by APB having completed the funding obligations relevant to the corresponding Option.  Any subscription for the Earn-in Shares shall be done at par value with the remainder of the total Advances made funded on account of the relevant equity subscription being allocated to the share premium account maintained by the Company. 

13.5     Transfer and Subscription Terms - The Earn-in Shares shall be subscribed for in accordance with the Transfer and Subscription Terms.

13.6     Dividends on Earn-in Shares - From and after the date of exercise of the applicable Option to the date of registration in the share register of the Company of the First 15% Shares, the Second 15% Shares or the 21% Shares, as applicable, in the name of APB (and/or such other member of the APB Group as may be nominated by APB by notice in writing from APB) there shall be no dividends declared or paid or other distributions made by the Company during such time.

13.7     Waiver of Pre-Emption Rights under Applicable Law - The Shareholders hereby waive all rights of pre-emption as may arise under applicable Law in respect of any Shares and acknowledge and agree that they shall only hold such rights of pre-emption to any Shares as provided for in this Agreement.

14.     APB'S FEASIBILITY OPTION AND FINANCING OPTION

14.1     Feasibility Option - AML shall procure that the Company shall grant and the Company hereby grants to APB (and/or to such other member or members of the APB Group as may from time to time be nominated by APB by notice in writing from APB) an option (the "Feasibility Option") to subscribe for, with effect on the date of exercise of the Feasibility Option, the Feasibility Shares.

14.2     Financing Option - AML shall procure that the Company shall grant and the Company hereby grants to APB (and/or to such other member or members of the APB Group as may from time to time be nominated by APB by notice in writing from APB) an option (the "Finance Option") to subscribe for, with effect on the date of exercise of the Finance Option, the Finance Shares.

14.3     Election to Proceed with Feasibility Option - APB shall, by notice in writing delivered within 60 days of the earlier of (i) the Final Earn-In Date, and (ii) the date the Board of the Company determines to proceed with the preparation of a Mining Feasibility Study, advise AML and the Board whether it wishes to proceed with the funding obligations required to enable APB to exercise the Feasibility Option, as such funding obligations are set out in Clause 10.3 (the "Feasibility Election Date").  

14.4     Exercise of Feasibility Option - The Feasibility Option shall be deemed to have been exercised by APB on the Feasibility Option Exercise Date.

27

<PAGE>

14.5     Subscription for Feasibility Shares with Ownership Interest - On the Feasibility Option Exercise Date, APB (and/or to such other member of the APB Group as may be nominated by APB by notice in writing from APB) shall subscribe for such number of Shares (the "Feasibility Shares") as represents, at the Feasibility Option Exercise Date, 9% of the issued Shares in the capital of the Company as at that date and the Shareholders shall procure that and the Company shall issue such Shares, as applicable, to APB.  APB (and/or such other member of the APB Group as may be nominated by APB by notice in writing from APB) shall be deemed to have increased its corresponding percentage Ownership Interest by 9% and no further consideration shall be payable in respect of the increase in such Ownership Interest.

14.6     Subscription Price for the Feasibility Shares - The subscription price for the Feasibility Shares acquired shall be deemed to have been satisfied by APB having completed the funding obligations set out in Clause 10.3.  Any subscription for the Feasibility Shares shall be done at par value with the remainder of the total Advances funded on account of such equity subscription being allocated to the share premium account maintained by the Company.  

14.7     Election to Proceed with Finance Option - Subject to APB having exercised the Feasibility Option, APB shall, by notice in writing delivered within 60 days of the approval by the Board to proceed with formal development of all or any part of the Pedra Branca Project into the Mining Phase (such approval being based on the Mining Feasibility Study), advise AML and the Board whether it wishes to proceed with the obligations required to enable APB to exercise the Finance Option.

14.8     Exercise of Finance Option - The Finance Option shall be deemed to have been  exercised by APB on the Finance Option Exercise Date; provided however that (i) the Project Financing Plan in respect of which the Finance Option may be exercised shall have been delivered by APB to the Board within 120 days from the date on which the Board formally approves the Mining Feasibility Study, and (ii) the Project Financing Plan provides for funding to be made available to the Company within 180 days from the date on which the Board formally approves the Mining Feasibility Study.  If the funding contemplated by the Project Financing Plan is not to be made available to the Company within 180 days from the date on which the Board formally approves the Mining Feasibility Study and the Board has not approved any later date for such availability unanimously, the Finance Option shall terminate; provided however that should the Board not approve any requested extension and, within a 180 days of such rejection approve and implement a subsequent financing plan for the development of all or any part of the Properties as contemplated in the Mining Feasibility Study approved by the Board on substantially the same terms and conditions as the Project Financing Plan, then the Finance Option shall be deemed to have been reinstated and APB shall be entitled to exercise same and receive the Finance Shares.

14.9     Subscription for Finance Shares with Ownership Interest - On the Finance Option Exercise Date APB (and/or to such other member of the APB Group as may be nominated by APB by notice in writing from APB) shall subscribe for such number of Shares (the "Finance Shares") as represents, at the Finance Option Exercise Date, 5% of the issued Shares in the capital of the Company as at such date and the Shareholders shall procure that and the Company shall issue such Shares, as applicable, to APB.  APB (and/or such other member of the APB Group as may be nominated by APB by notice in writing from APB) shall be deemed to have increased its corresponding Ownership Interest by 5% and no further consideration shall be payable in respect of the increase in such Ownership Interest.

14.10     Subscription Price for the Finance Shares - The subscription price for the Finance Shares acquired shall be deemed to have been satisfied by APB having delivered to the Board of the Company a Project Financing Plan on the terms set out in Clause 14.8 above, it being 

28

<PAGE>

understood by the Parties that, as contemplated in Clause 11.4, any subscription for such Finance Shares shall be implemented at par value.

14.11     Transfer and Subscription Terms - The Feasibility Shares and the Finance Shares shall be subscribed for in accordance with the Transfer and Subscription Terms. If required by APB or under Applicable Law, the Company shall execute such separate subscription option agreement or other instrument evidencing the Feasibility Option or the Finance Option, as applicable, as may be reasonably required by APB, which agreement or other instrument shall contain terms and conditions which are consistent with this Article 14 and the Transfer and Subscription Terms and such other terms and conditions as are customarily included in such agreements or instruments.

14.12     Voting of Feasibility Shares and Finance Shares - From and after the Feasibility Option Exercise Date or the Finance Option Exercise Date, as applicable, to the date of registration in the share register of the Company of the relevant number of Shares in the name of APB (and/or such other member of the APB Group as may be nominated by APB by notice in writing from APB), AML shall only exercise any voting rights attaching to a number of Shares held by it corresponding to the number of Feasibility Shares or Finance Shares, as applicable, in accordance with the written instructions of APB and, if required by APB, shall deliver to APB a power of attorney in form and substance satisfactory to APB acting reasonably for the purpose of enabling APB or any of its Authorised Representatives to exercise such voting rights.

14.13     Dividends on Feasibility Shares and the Finance Shares - From and after the Feasibility Option Exercise Date or the Finance Option Exercise Date, as applicable, to the date of registration in the share register of the Company of the relevant number of Shares in the name of APB (and/or such other member of the APB Group as may be nominated by APB by notice in writing from APB) there shall be no dividends declared or paid and other distributions made by the Company other than as expressly approved by the Board during such time.

15.     HSEC STANDARDS AND CONDUCTS OF OPERATIONS

15.1     Applicable HSEC Standards - All activities carried out under this Agreement shall be governed by health, safety, environment and community policy and standards (the "Applicable HSEC Standards") that shall be agreed by the Parties both with respect to content and application and shall be documented by the Parties in agreed form.  The Applicable HSEC Standards shall be appropriate for the specific Operations overseen by the Manager and shall take into account the APB Group Policies, any relevant policies of members of the SRC Group and requirements under Applicable Law.  Each Party to this Agreement hereby procures that the Applicable HSEC Standards will be agreed and adopted by the Company.

15.2     APB Group Policies - AML acknowledges that it is aware of the provisions of the business code of conduct and the health, safety, environmental and community policies and fatal risk protocols of the APB Group (collectively, the "APB Group Policies") and that copies of the same have been provided to AML by APB.

15.3     Changes to Applicable HSEC Standards - If the character of the activities to be carried out under this Agreement or the contractual relationship of the Parties changes in any material way, any Party may, acting reasonably and in good faith, request an amendment of the Applicable HSEC Standards to address such changes in the activities, which request shall not be unreasonably denied by the other Parties.

15.4     Conduct of Operations - During the term of this Agreement, the Company shall and shall cause the Manager to:
15.4.1     do, or cause to be done, all work under the Agreement and any Services Agreement in a good and workmanlike fashion;

29

<PAGE>
15.4.2     carry out and cause any employees and contractors to carry out Operations in compliance with all Applicable Laws and Applicable HSEC Standards; and

15.4.3     take and require any employees and contractors to take, all necessary precautions in carrying out the Operations to protect from damage or injury the environment, any person, the property of any person, reputation of a Party or Manager or any combination of the foregoing.

16.     COVENANTS RELATING TO PEDRA BRANCA PROJECT

16.1     Negotiations Relating to Mining Concessions - APB and AML will procure that the Company will as soon as practicable after the Effective Date enter into negotiations and discussions with the DNPM, with the objective that the DNPM will agree, subject to Applicable Law, on matters relevant to the Pedra Branca Project including, without limitation, the deferral of the decision in respect of the final exploration reports filed in respect of claims no. 800.095/99 and no. 800.097/99 and that the Company shall be granted as much time as it may require to complete the Exploration Phase.

16.2     Establishment of Contingency Fund - The Shareholders shall cause the Company to establish and administer a contingency fund (the "Contingency Fund") by no later than the Final Earn-In Date, to be funded as part of an Approved Work Programme and Budget.  Contingency Fund monies, if any, shall be invested and re-invested by the Company in such liquid investments as the Board may from time to time authorize.  To the extent possible under then existing tax laws, the Contingency Fund shall be set up and administered in such a manner as to provide the most beneficial tax treatment to first, the Company, and second, the Shareholders.  The moneys deposited in the Contingency Fund shall be used by the Company in order to satisfy the legal obligations of the Company in connection with the permanent or temporary shutdown in whole or in part of any mine on the Properties, whether or not such obligations are recognized in the accounts of the Company and including, without limitation, the requirement of any Governmental Authority to post reclamation bonds or deposits, all anticipated costs of reclamation of the surface lands covered by the Properties and other environmental rehabilitation as may be required by any Governmental Authority and any obligation for severance pay and pensions for employees.

16.3     Environmental Indemnity - Solitario and AML shall fully indemnify and hold harmless APB and its officers, directors, employees, agents, attorneys and any member of the APB Group in respect of all Indemnified Losses incurred by such person in connection with the estimated costs of reclamation of the surface lands to the Properties and other environmental rehabilitation as may be required by any Governmental Authority (whether or not such obligations are recognised in the accounts of the Company) accrued to the date of the Letter Agreement.

16.4     Sale of Product 
16.4.1     Subject to Clause 16.4.2, the Company shall only Dispose of Product produced from the Properties in accordance with the policies adopted by the Board from time to time in respect of Disposition of Product.

16.4.2     For so long as APB has a Shareholding in the Company, the Company shall not Dispose of any Product produced from the Properties from time to time and as relevant at such point in time, without, in each instance, first offering to the APB Group the right to Dispose of such Product to any person (including any member of the APB Group), provided such right is exercised by the APB Group on terms and conditions that represent fair value and arm's length terms.  Prior to the Company determining to Dispose Product from time to time, in each instance:
16.4.2.1     the Company shall provide notice to APB of its desire to Dispose of Product (in each instance for the purposes of this Clause 16.4.2, a "Disposition"), which notice shall specify all matters reasonably relevant to 

30

<PAGE>
the Disposition including the nature of the disposition, the total amount, the quality and the date of availability of the Product;

16.4.2.2     APB (or any of its Affiliates) shall within 60 days provide to the Company a written proposal for the Disposition, setting out clearly all of the terms and conditions of the intended Disposition (the "APB Proposal");

16.4.2.3     the Company shall accept or reject the APB Proposal within 30 days of receipt of the APB Proposal and notify APB or the proposing Affiliate, as the case may be (with a copy to APB) in writing of the acceptance or, if not accepted, the reasons for such rejection, it being agreed by the Parties that any acceptance by the Company under this Clause 16.4.2.3 shall require unanimous Board approval;

16.4.2.4     if the Company does not accept the APB Proposal, it may solicit and consider bona fide third party proposals for the whole of the Disposition concerned (and not part only) and may Dispose of the relevant Product; provided that the terms and conditions of such Disposition with such third party are superior to those stated in the APB Proposal for such Disposition; and provided further that the Board has unanimously approved such bona fide third party proposal, which approval shall cover any matching offer made by APB or any of its Affiliates pursuant to Clause 16.4.2.5; 

16.4.2.5     if the Company does not accept the APB Proposal and within the period in Clause 16.4.2.4 the Company obtains a bona fide third party proposal that complies with the conditions in that Clause, then the Company shall not accept the bona fide third party proposal without first notifying APB of the terms and conditions thereof and requesting APB in such notice to match such bona fide third party proposal within 45 days of its receipt of such notice.  If APB or any of its Affiliates notifies the Company in writing of its intention to match such bona fide third party proposal within such period, then the Company shall be deemed to accept the matching offer with effect from the date thereof; and  

16.4.2.6     if the Company does not accept the APB Proposal and the period in Clause 16.4.2.4 has expired without the Company having obtained a bona fide third party proposal that complies with the conditions in that Clause, then all the provisions of this Clause 16.4.2 shall apply again de novo to the Disposition concerned. 

16.4.3     For greater certainty, the Parties acknowledge and agree that the rights and obligations provided for in this Clause 16.4 apply from time to time as Product is disposed of by the Company at potentially varying stages.

17.     AREA OF INTEREST

17.1     Area of Interest - If, during the term of this Agreement, any Shareholder (the "Acquiring Shareholder") stakes or otherwise acquires an interest in any property within the Area of Interest (the "Additional Claims"), then the Acquiring Shareholder shall forthwith give notice to the other Shareholder of that staking or acquisition, the cost thereof and all details in possession of the Acquiring Shareholder with respect to the nature and location of the Additional Claims and the known mineralization, if any.  

17.2     Election to Acquire - The other Shareholder(s) may, within 30 days of receipt of the Acquiring Shareholder's notice, elect, by notice to the Acquiring Shareholder, to require that the Additional Claims be included in and thereafter form part of the Properties for all purposes of this Agreement.  If any Shareholder makes the election contemplated in this Clause 17.2, then the Additional Claims shall be included in and thereafter form part of the Properties and the other Shareholder shall reimburse the Acquiring Shareholder for its staking 

31

<PAGE>

or acquisition costs in proportion to its Ownership Interest at that time and the Acquiring Shareholder shall enter into such transfer documentation as is required to transfer such Additional Claims to the Company.  If the other Shareholder does not make the election contemplated in this Clause 17.2, then the Additional Claims acquired will not form part of the Properties and the Acquiring Shareholder will be solely entitled thereto. 

18.     COVENANTS RELATING TO PROJECT FUNDING

18.1     Financing Plan - Unless otherwise approved by the Board, each of the Shareholders acknowledge that a financing plan for the development of the Pedra Branca Project, including the Project Financing Plan, may include the following characteristics:
18.1.1     if guarantees or other forms of financial support are required by any lenders, such guarantees and financial support shall (i) be given severally by the Shareholders (and not jointly or jointly and severally with the other Shareholder) in proportion to their respective Shareholdings and (ii) terminate and be released upon any project completion;

18.1.2     any Encumbrance required by any lenders to be granted by the Shareholders and their Affiliates shall (i) be limited to the Interests held by such Shareholder and its Affiliates and (ii) terminate and be released upon any project completion; and

18.1.3     the rights of the Shareholders and their Affiliates in respect of any Indebtedness under Company Loan Notes may, if necessary, be subordinated to the rights of any lender,

and each of the Shareholders shall provide such support and assistance as may be reasonably requested by the Company in connection with the implementation of any financing plan approved by the Board in accordance with the terms of this Agreement.

19.     OTHER COVENANTS

19.1     Covenants of AML - AML hereby covenants and agrees with APB that upon the execution of this Agreement, AML shall, and AML shall procure that the Company shall, if requested to do so by APB by notice in writing and this is possible under Applicable Law, register the Interest of APB with the appropriate Governmental Authority to properly evidence this Agreement, or the substance of this Agreement, and protect the rights and interests of APB acquired hereunder from adverse claims by third parties.

19.2     Covenants of APB - APB hereby covenants and agrees with AML that APB shall procure that should a member of the APB Group become Manager, such member (i) considers in good faith (without any obligation to purchase) purchasing equipment from the AML Service Company and (ii) considers in good faith (without any obligation to assume) the assumption of the rights and obligations of AML Service Company under its drilling, bulk sampling, earth moving and other service contracts relating to the Pedra Branca Project.

19.3     Covenants of APB and AML - Each of APB and AML covenants and agrees with the other Party as follows:
19.3.1     it will procure that the Company complies at all times with the Applicable HSEC Standards; and

19.3.2     it will use reasonable efforts to procure that the Company is treated for all purposes, including for the purposes of taxation, as a resident of Brazil.

19.4     Covenants of all Parties - Each of the Parties hereby covenants and agrees with the other Parties as follows:
19.4.1     each of the Parties undertakes at all times to do all such things, perform all such actions and take all such steps and to procure the doing of all such things, the performance of all such actions, and the taking of all such steps, as may be open to them and necessary or desirable for or incidental to the putting into affect or maintenance of the terms, conditions and intent of this Agreement; and

32

<PAGE>
19.4.2     each Party will procure that the Articles and By-Laws (New) shall be amended, supplemented or replaced if and to the extent necessary in accordance with Applicable Law to give effect to the terms, conditions and intent of this Agreement.

20.     GUARANTEE

20.1     Guarantee of AML's Obligations - In consideration of APB entering into this Agreement with AML, Solitario hereby irrevocably and unconditionally undertakes and guarantees the full, prompt and complete performance by AML of all its obligations under this Agreement.  The guarantee contained in this Clause 20.1 is a continuing guarantee and shall survive termination of this Agreement and shall remain in full force until all obligations of AML under this Agreement have been fully performed.

20.2     Guarantee of APB's Obligations - In consideration of AML entering into this Agreement with APB, RPM hereby irrevocably and unconditionally undertakes and guarantees the full, prompt and complete performance by APB of all its obligations under this Agreement.  The guarantee contained in this Clause 20.2 is a continuing guarantee and shall survive termination of this Agreement and shall remain in full force until all obligations of APB under this Agreement have been fully performed.

21.     INDEMNITIES

21.1     Indemnity from AML - AML shall fully indemnify and hold harmless APB and its officers, directors, employees, agents, attorneys and any member of the APB Group in respect of all Indemnified Losses incurred by such person in connection with or arising as a result of (i) any breach by AML of any representation and warranty made by it in this Agreement, (ii) any material breach by AML of any of its obligations hereunder, or (iii)  the invalidity or unenforceability of the transactions contemplated in this Agreement.

21.2     Indemnity from APB - APB shall fully indemnify and hold harmless AML and its officers, directors, employees, agents, attorneys and any member of the AML Group in respect of all Indemnified Losses incurred by such person in connection with or arising as a result of (i) any breach by APB of any representation and warranty made by it in this Agreement, (ii) any material breach by APB of any of its obligations hereunder, or (iii)  the invalidity or unenforceability of the transactions contemplated in this Agreement.

22.     REPRESENTATIONS AND WARRANTIES

22.1     Representations and Warranties  - Each Party represents and warrants to the others that the statements made by it in Schedule 8 (Representations and Warranties) are true, accurate and not misleading as of the dates set out in such Schedule, and that each such statement shall be true, accurate and not misleading as of the respective dates thereof (as though repeated then).

22.2     Survival and Acknowledgement  - The representations and warranties set forth in Schedule 8 (Representations and Warranties) shall survive the execution and delivery of this Agreement and continue in full force and effect until the expiry of the relevant limitation periods under Applicable Law.

23.     ACCOUNTING MATTERS

23.1     Books and Records - The Parties shall procure that full, complete and accurate books of account, records and information with respect to the affairs of the Company are maintained and kept at the registered office of the Company (and such other place as the Board may deem desirable or as may be required by Applicable Law).  Entries shall be made in such books of account and records of all such matters, transactions and things as are usually written and entered in books of account and records kept by persons or entities engaged in businesses similar to the Business and electronic records shall be kept where feasible.  Each of APB and AML shall have the right, acting reasonably, to audit, examine, and make copies of or extracts from the books of account and records of the Company at all reasonable times during usual business hours.  Such right may be exercised through any agent or employee of 

33

<PAGE>

such Party designated by it, or by an independent chartered accountant or adviser designated by such Party.  Each of APB and AML shall bear all expenses incurred in any examination made for such Party's account.

23.2     Annual Audited Financial Statements - Within 90 days after the end of each Financial Year (or such shorter period as may be approved by the Board) there shall be provided to the Board audited consolidated and unconsolidated financial statements of the Company, expressed in United States Dollars and prepared in accordance with IFRS consistently applied, together with a report of the auditors of the Company thereon.  The Parties acknowledge that under Applicable Law, the Company must prepare and have approved by the Shareholders annual financial statements expressed in Brazilian currency and prepared in accordance with Brazilian generally accepted accounting practice and that such accounts will be prepared by the Board of Officers of the Company as provided for in the Articles and By-Laws (New).

23.3     Management and Financial Reports - The Parties shall procure that the Services Agreement provides for the Manager to provide to the Board a management and financial report in respect of the Pedra Branca Project, quarterly during the Exploration Phase and monthly during the Mining Phase, within 20 Business Days after the end of the relevant quarter or month, as the case may be.  Such report shall contain such financial and operating information as set out in the relevant Services Agreement or as may be reasonably requested from time to time by APB or AML.

24.     LIQUIDATION
This Agreement shall terminate upon a resolution being passed for the winding up of the Company.  Forthwith following such termination, the Shareholders shall use their reasonable efforts to agree on a suitable basis for dealing with the interests and assets of the Company and (unless otherwise agreed in writing by the Shareholders and subject to Applicable Law):

24.1.1     the Shareholders shall co-operate (but without any obligation to provide any additional funds) with a view to enabling all existing obligations of the Company to be fulfilled insofar as its resources allow;

24.1.2     the Shareholders shall consult together with a view to outstanding contracts being novated or re-allocated in a suitable manner; 

24.1.3     no new contractual obligations for the supply of products or services shall be assumed by the Company; 

24.1.4     each of the Shareholders shall use its reasonable efforts to procure that the Company shall as soon as possible be wound up; and

the Company shall as soon as reasonably practicable deliver up to the relevant Shareholders all drawings, notes, copies or other representations of confidential information proprietary to or disclosed by that Shareholder or any of its Affiliates to the Company.

25.     CONFIDENTIAL INFORMATION

25.1     Confidential Information - Each of the Parties agrees that it shall at all times treat all Confidential Information as strictly confidential and that, except as may be expressly permitted by a written agreement between the Parties, it shall not, directly or indirectly, at any time or under any circumstances:
25.1.1     make use of (or make available to any of its Affiliates for their use) any such information other than in connection with the Pedra Branca Project; or

25.1.2     communicate or disclose any such information to any person for any purpose whatsoever, except to any person which has a bona fide need to know such information in connection with the Company and the Business, and subject to such person agreeing to the terms, mutatis mutandis, of this Article 25 to keep such information confidential.

25.2     Excluded Information - For purposes of Clause 25.1, Confidential Information shall exclude any knowledge or information which:
25.2.1     is or becomes generally available to the public other than as a result of disclosure by such Party in violation of this Article 25;

25.2.2     is or was independently developed by such Party or on its behalf by personnel having no access to such knowledge or information at the time of independent development;

25.2.3     other than Confidential Information obtained by a Party under the terms of the Letter Agreement or the Framework Agreement, is already in such Party's possession, provided that such knowledge or information was not supplied to such Party by, or on behalf of, the Company or the other Party, and provided further that such knowledge or information was not obtained from a source known to such Party to be prohibited from disclosing such information to such Party by a legal, contractual or fiduciary obligation to the Company;

25.2.4     is required to be given, made or published by Applicable Law or under the rules and regulations of any relevant stock exchange or any applicable regulatory authority, in which case the Party liable to so give, make or publish the same shall give the other Party reasonable written notice thereof, along with drafts or copies thereof, as soon as is reasonably practicable; or

25.2.5     is required to be disclosed to any provider of finance in order for such providers to take informed decisions regarding the Company or the Business; provided that such providers agree to keep the information disclosed as strictly confidential.

25.3     Notice of Disclosure - In the event that a Party becomes legally compelled to disclose any Confidential Information, such party will provide the other Parties with prompt notice so that they may seek a protective order or other appropriate remedy and/or waive compliance with the provisions of this Article 25.  In the event that such protective order or other remedy is not obtained, or that the other Parties waive compliance with the provisions of this Article 25, such Party may disclose only that portion of such Confidential Information which such Party, after receiving legal advice, is legally required to disclosed and shall co-operate with other Parties at the Company's expense to obtain reliable assurance that confidential treatment will be afforded such information that is so disclosed.

26.     DISTRIBUTIONS
          Subject to Applicable Law, the Parties shall procure that any payment of dividends or other distributions on account of Shares or on account of interest and repayment under the Company Loans, shall only be made in accordance with a distribution policy approved by the Board and in accordance with Applicable Law; provided that the Parties agree with the general principle that all profits of the Company available for the payment of dividends or other distributions on account of the Shares are declared, paid and distributed to the shareholders of the Company as soon as practicable and that such principle shall form the basis of any distribution policy adopted by the Board.

27.     DISPUTE RESOLUTION

27.1     Procedure for Resolving Disputes - Save for those matters referred to Schedule 2 (Expert Determination) in accordance with this Agreement, disputes between the Parties arising out of or pursuant to the provisions of this Agreement will be referred for resolution in accordance with the provisions of this Article 27.

27.2     Consultation and Referral  - In the event of any dispute, difference, claim, controversy or question between the Parties, directly or indirectly arising at any time under, out of, in 

34

<PAGE>

connection with or in relation to this Agreement (or the subject matter of this Agreement) or any term, condition or provision hereof, including without limitation any of the same relating to the existence, validity, interpretation, construction, performance, enforcement and termination of this Agreement (a "Dispute"), the affected Parties (the "Disputing Parties") shall, in the first instance, forthwith refer the Dispute for resolution between the CEO of Solitario and the Executive Director of RPM responsible for RPM's international platinum group metals business, and if such dispute cannot be resolved within 30 Business Days of such referral, may refer such Dispute for arbitration in accordance with the provisions of Clause 27.3.  

27.3     Arbitration -
27.3.1     Except as otherwise provided in this Agreement, if any Dispute is not resolved pursuant to Clause 27.2 within 30 Business Days of its referral, such Dispute shall be, if requested by any Disputing Party, referred to and finally settled by arbitration in accordance with the Rules of Arbitration of the International Chamber of Commerce, as amended or substituted from time to time (the "ICC Rules") which ICC Rules are deemed to be incorporated into this Agreement except to the extent expressly modified by this Clause 27.  Save as provided in Clause 27.2, arbitration shall be the exclusive method for resolution of the Dispute, and the determination of the arbitrators shall be final and binding.  The Parties agree that they will give conclusive effect to the arbitrators' determination and award and that judgment thereon may be entered and enforced by any court of appropriate jurisdiction.  

27.3.2     The tribunal shall consist of three arbitrators.  Each of Solitario and RPM shall appoint one arbitrator and such arbitrators shall agree and appoint a third arbitrator.

27.3.3     The place of arbitration shall be Toronto, Canada.  The language to be used in the arbitration shall be English, and any documents or portions of them presented at such arbitration in a language other than English shall be accompanied by a certified English translation thereof.  The arbitrators shall decide such Dispute in accordance with the substantive laws of Ontario applicable hereto.

28.     TRANSFERS OF INTERESTS

28.1     Transfers Prohibited - Except as expressly provided in this Agreement, a Shareholder may not, directly or indirectly, sell, transfer, assign or otherwise dispose of, or grant or suffer to exist any Encumbrance or other interest in, any Interest of such Shareholder or agree to do any of the foregoing.

28.2     Permitted Transfers - Notwithstanding Clause 28.1, a Shareholder may:
28.2.1     sell, transfer or assign some or all of its Interests to any Affiliate of such Shareholder provided that such Affiliate agrees to be bound by the terms and conditions of this Agreement and, prior to such Affiliate ceasing to be an Affiliate of such Shareholder, such Interests (or part thereof) shall be re-transferred to such Shareholder or to one of its Affiliates (in which case this proviso shall apply to such Affiliate);

28.2.2     sell, transfer or assign all, but not less than all, of the Interests held by it pursuant to a bona fide sale to any person that is a body corporate for a consideration payable in cash or non cash consideration comprised of shares in a publicly traded entity but not on deferred terms, subject to compliance with the provisions of Clause 28.3; or

28.2.3     sell, transfer and assign some or all of its Interests to any person with the written consent of the other Shareholder. 

28.3     Right of First Refusal - If a Shareholder proposes to sell, transfer and assign all, but not less than all, of the Interests held by it pursuant to Clause 28.2.2:

35

<PAGE>
28.3.1     such Shareholder (the "Disposing Shareholder") shall give the other Shareholder (the "Continuing Shareholder") an irrevocable notice (a  "Transfer Notice") setting out fully and clearly all of the terms and conditions of the intended transfer together with a currency equivalent of any non-cash consideration (expressed in United States Dollars) and an explanation of the manner in which such currency equivalent was calculated and shall include a copy of the third party offer at which it proposes to sell its Interests;

28.3.2     if the Continuing Shareholder gives a notice to the Disposing Shareholder within 90 days of receiving the Transfer Notice (the first day being the day after it receives the Transfer Notice) that it wishes to buy all of the Disposing Shareholder's Interests, the Continuing Shareholder shall be required to purchase such Interests, and the Disposing Shareholder shall be required to sell such Interests, at the price specified in the Transfer Notice;

28.3.3     any sale and purchase of Interests pursuant to this Clause 28.3 shall be made upon and subject to the Transfer and Subscription Terms; 

28.3.4     if, at the expiry of the 90 day period specified in Clause 28.3.2, the Continuing Shareholder has not notified the Disposing Shareholder that it wishes to buy the Disposing Shareholder's Interests, the Disposing Shareholder may sell, transfer and assign all, but not less than all, of its Interests at a price which is not less than the price specified in the Transfer Notice provided that it does so within 90 days of the expiry of such 90 day period; and

28.3.5     the Disposing Shareholder shall procure that, in relation to the Interests being sold, any buyer of such Interests shall enter into a deed or other instrument acceptable to the Continuing Shareholder acting reasonably pursuant to which such buyer agrees to be a party to, and bound by the terms and conditions of, this Agreement and any other joint venture or shareholders agreement to which the Disposing Shareholder is a party in connection with such Interests as such terms and conditions apply to the Disposing Shareholder immediately prior to such sale of the Disposing Shareholder's Interests.

28.4     Change of Control - If a member of the AML Group proposes to enter into a transaction or series of transactions that will result in a Change of Control of AML, any of its holding companies or Solitario or if any such Change of Control occurs, APB shall have the option, within 60 days of becoming aware of the proposed transaction or the occurrence of the applicable Change of Control, to purchase the Interests (the "Sold Interest") held by AML from AML at a purchase price equal to 100% of the Fair Value of the Sold Interest.  The purchase price of the Sold Interest shall be determined by the Expert in accordance with the procedure set out in Schedule 2 (Expert Determination) hereto and the terms of Clauses 29.1.2 and 29.1.3 shall apply mutatis mutandis. 

29.     DEFAULT

29.1     Event of Default Option -
29.1.1     If a Shareholder commits or causes an event of default (the "Defaulting Shareholder") in accordance with Clause 29.2 (excluding a Funding Default), then the other Shareholders (the "Non-Defaulting Shareholders") shall have the option, within 60 days of becoming aware of the occurrence of the event of default, to purchase the Interests (the "Transferred Interest") held by the Defaulting Shareholder at a purchase price equal to 75% of the Fair Value of the Transferred Interest with, in each case, the purchase price being determined by the Expert in accordance with the procedure set out in Schedule 2 (Expert Determination) hereto.  The Shareholders hereby acknowledge and agree that the discount to the Fair Value of the Transferred Interests referred to in this clause does not (and shall not be construed 

36

<PAGE>
to) constitute a penalty imposed on the Defaulting Shareholder and that such discount represents the Shareholders' genuine pre-estimate of the damages that the Non-Defaulting Shareholder(s) would suffer in the circumstances contemplated hereby.

29.1.2     The option referred to in Clause 29.1.1 shall be exercised by delivering written notice to the Defaulting Shareholder stating that the option is exercised. 

29.1.3     If the option pursuant to this Clause 29.1.1. is exercised, the Defaulting Shareholder shall, subject to any outstanding Dispute, if applicable, deliver, within 30 days from the date of delivery of the written notice referred to in Clause 29.1.2, duly executed transfer forms of all the Shares held or beneficially owned by it in favour of the Non-Defaulting Shareholders upon full payment to the Defaulting Shareholder.  The transfer of the Transferred Interests pursuant to this Clause 29.1 shall otherwise be made upon and subject to the Transfer and Subscription Terms. 

29.2     Definition of Event of Default - For the purpose of Clause 29.1, an event of default is committed or caused by a Shareholder if:
29.2.1     a judicial management or a liquidation, or equivalent proceeding, (whether provisional or final, whether voluntary or involuntary) is enforced upon or sued out against its property which is not discharged within 10 Business Days;  or

29.2.2     it is unable to pay its debts in the normal course of business;  or

29.2.3     it ceases or threatens to cease wholly or substantially to carry on its business, otherwise than for a reconstruction, restructuring or merger, without insolvency, previously approved by the Non-Defaulting Shareholders, which approval shall not be unreasonably withheld;  or 

29.2.4     an encumberer takes possession of, or a liquidator or judicial manager (or equivalent authority) is appointed over the whole or substantial part of, its undertaking, property or assets;  or

29.2.5     an order is made or a resolution is passed for its winding up, sequestration or placing under judicial management, whether provisionally or finally and, otherwise than for the purpose of a reconstruction, restructuring or merger, without insolvency, previously approved by the Non-Defaulting Shareholders, which approval shall not be unreasonably withheld; or

29.2.6     a Shareholder shall have breached or otherwise failed to comply with the provisions of Article 28 or Clause 10.10 and shall not have cured such default within 30 days of such breach or failure to comply.

29.3     Exclusivity of Remedies -
29.3.1     The remedies conferred on non-defaulting Shareholder in this Agreement in respect of any Funding Default shall be the sole and exclusive remedies and no Party or other person shall have any right of action, remedy or other claim (whether for damages, specific performance or otherwise) against any other Party in respect of any such Party's Funding Default in accordance with this Agreement, whether founded on breach of this Agreement or in equity and any and all such rights of action, remedies and claims are hereby excluded.  The obligations of each Shareholder to advance Advances or Required Shareholder Funding pursuant to this Agreement are owed by such Shareholder to the other Shareholder (and no other Person) and the Company shall not be entitled to make any claim for breach of this Agreement or otherwise against any Shareholder for failure to advance any Advances in accordance with this Agreement.

29.3.2     In the case of any Event of Default or other breach of this Agreement (other than a Funding Default), the remedies herein expressly conferred on any Party shall not be exclusive of any other remedy available to such Party (whether at law, in equity or otherwise) and all such remedies shall be cumulative and in addition to any 

37

<PAGE>
remedies herein expressly conferred.

29.3.3     Notwithstanding anything in this Agreement, no Party shall have any liability to any other Party (whether in contract, tort or otherwise) for any consequential or indirect losses (including loss of anticipated profits) arising out of any Event of Default or other breach of this Agreement.

30.     NOTICES

30.1     Addresses for Notice - The Parties specify as address for notices for all purposes of and in connection with this Agreement as follows:
APB and its Affiliates:

Rustenburg Platinum Mines Limited

55 Marshall Street

Johannesburg 2001

South Africa

Fax: +27 11 373-5111

Attention: Company Secretary

AML and its Affiliates:

Solitario Resources Corporation

4251 Kipling Street, Suite 390

Wheat Ridge, Colorado 80033

USA

Fax: + 1 303 534 1809

Attention: Chris Herald

The Company:

Pedra Branca Do Brasil Mineracao S.A.

Rau Voluntarios da Patria, 45, sala 1306

Botafogo, Rio de Janeiro, RJ

Brazil

Fax: 55 21 2246 6727

Attention: The Board of Officers 

30.2     Changes to Address - The Parties shall be entitled to change their address for notices from time to time, provided that any new address for notices selected shall not be a box number and any such change shall only be effective upon receipt of notice in writing by the other Parties of such change.

30.3     Giving of Notice - All notices, demands, communications or payments intended for any Party shall be made or given at such Party's address for notices for the time being.

30.4     Valid Notice - A notice sent by one Party to another Party shall be deemed to have been received:
30.4.1     on the same day, if delivered by hand;

30.4.2     on the same day, if sent by telefax.

30.5     Actual Receipt - Notwithstanding anything to the contrary herein contained a written notice or communication actually received by a Party shall be an adequate written notice or communication to it notwithstanding that it was not sent to or delivered at its address for notices.

31.     COSTS
Each Shareholder shall bear its own costs incurred in negotiating and drafting this Agreement.

32.     GOVERNING LAW
This Agreement shall be governed by the laws of Ontario and the federal laws of Canada applicable therein.

33.     GENERAL

33.1     Entire Agreement - This Agreement and the documents referred to herein constitute the entire obligation of the Parties with respect to the subject matter hereof and shall supersede any prior expressions of intent or understandings with respect to this 

38

<PAGE>

Agreement.  Any amendment to, waiver by any Party of any of the terms or conditions of, or consent given by any Party under, this Agreement (including, without limitation, this Clause 33.1) shall be in writing, signed by the relevant Party and, in the case of an amendment, by all Parties.

33.2     Waiver -  No indulgence which any Party (the "grantor") may grant to the others (the "grantees") shall constitute a waiver of any of the rights of the grantor, who shall not thereby be precluded from exercising any rights against the grantees which might have arisen in the past or which might arise in the future.

33.3     Severability - If at any time any provision of this Agreement is or becomes invalid, illegal or unenforceable in any respect, such provision shall be deemed to be severed from this Agreement but the validity, legality and enforceability of the remaining provisions of this Agreement shall not be affected or impaired thereby.

33.4     Conflict - In the event of any conflict or inconsistency between any provision of this Agreement and the provisions of the existing articles of association and by-laws of the Company, and the Articles and By-Laws (New), the provisions of this Agreement shall, as regards the respective rights and obligations of the Parties, govern and prevail (unless a contrary intention is clearly evidenced in such other document(s)).

34.     ASSIGNMENT
This Agreement shall bind and inure to the benefit of the respective successors and permitted assigns of the Parties provided that none of the Parties shall be entitled to assign any of their rights, obligations or Interests under this Agreement except in accordance with the provisions of Article 28.

35.     FORCE MAJEURE

35.1     Event of Force Majeure - A Party shall not be in default of any obligation it has under this Agreement to the extent that the performance of such obligation is prevented, hindered or delayed by an unforeseen event occurring beyond such Party's control (that is, the occurrence or effects of which the Party could not prevent) other than shortage of funds (each, an "Event of Force Majeure").  Event of Force Majeure shall include, but is not limited to, the following events:
35.1.1     war, civil war, terrorist attack, riot and revolution;

35.1.2     natural disasters like earthquake, flood or fire;

35.1.3     strike, lock-out or other industrial action by workers or employers; and

35.1.4     act or refusal or failure to act of a Governmental Authority, whether lawful or unlawful.

35.2     Notification and Mitigation - A Party affected by an Event of Force Majeure shall notify the other Parties in writing forthwith after the occurrence of such an event. The notification shall include a description of the Event of Force Majeure, the date of commencement thereof and an estimate of its probable duration.  The affected Party shall diligently attempt to eliminate or mitigate the effects of the Event of Force Majeure.

35.3     Affected Party Excused from Performance - The Party giving notice of the Event of Force Majeure shall be excused from the performance of its contractual obligations affected by the Event of Force Majeure for so long and so far as the circumstances of prevention, hindrance or delay of such obligations may continue. Upon the termination of the Event of Force Majeure, the performance of this Agreement  shall be completed as originally agreed with such adjustments as may be required to reflect the occurrence of the Event of Force Majeure.

39

<PAGE>

36.     COUNTERPARTS
This Agreement may be executed in counterparts, each of which shall be deemed an original but all of which together shall constitute one and the same agreement. This Agreement may be executed by facsimile.

[The remainder of this page has been left blank intentionally.]

40

<PAGE>
IN WITNESS WHEREOF the Parties have executed this Agreement with the intention that it be delivered on the date of the last signing Party.

ANGLO PLATINUM BRASIL S.A.

By: /s/ V. Galliez                         

Name:V. GALLIEZ

Title:Director

Date:

Place:Rio de Janeiro, Brazil

By: /s/ C. Melcher                        

 

Name:C. MELCHER

Title: Director 

Date:

Place:Rio de Janeiro, Brazil

41

<PAGE>

ALTORO MINERACAO LTDA

By: /s/ M.A.G.V. Goncalves        

Name: M. A. G. V. GONÇALVES

Title: Director 

Date:

Place:Rio de Janeiro, Brazil

42

<PAGE>

PEDRA BRANCA DO BRASIL MINERACAO  S.A.

By: By: /s/ M.A.G.V. Goncalves        

Name: M. A. G. V. GONÇALVES

Title: Director 

Date:

Place:Rio de Janeiro, Brazil

 

By: /s/ L. Azevedo                              

Name: L. AZEVEDO

Title: Director 

Date:

Place:Rio de Janeiro, Brazil

43

<PAGE>

RUSTENBURG PLATINUM MINES LIMITED

By: /s/ N. Mbazima                       

Name:  N. MBAZIMA

Title:  Executive Director, Finance

Date: 

Place:  Johannesburg, South Africa

44

<PAGE>

SOLITARIO RESOURCES CORPORATION

By: /s/ C. Herald                                 

 Name:  C. HERALD

Title:    President & CEO

Date:

Place:Denver, Colorado

45

<PAGE>

SCHEDULE 1

INITIAL CONTRIBUTION

	The initial contribution of AML for the purposes of the definitions of "Reducing Shareholder's Initial Contribution" and "Non-Reducing Shareholder's Initial Contribution" ("G") shall be determined on each Calculation Date in accordance with the following formula:

	
G =
	
H
	 	
*
	
1 - J

	 	
J

where
"H"     is the total of all APB's actual contributions to the Company after the date of the Letter Agreement and to the Calculation Date

"J"     is the Ownership Interest of APB at the Calculation Date,

"Calculation Date" shall mean:

(i)     the date APB elects to cease Sole Funding in accordance with Clause 10.9; and

(ii)     the date APB has exercised the Feasibility Option.

 

<PAGE>
SCHEDULE 2

EXPERT DETERMINATION

1.     Appointment of Expert

To the extent provided in this Agreement, values which cannot be agreed between APB and AML will be referred, upon notice given by either of APB or AML to the other, for determination by an independent expert hereunder. An independent expert  (the "Expert") shall be jointly appointed by APB and AML within thirty (30) Business Days after such notice.  Any person to be appointed as Expert shall be neutral and reputable, shall have a good comprehension of the international platinum group metals mining industry or such other expertise as may apply to the issue under dispute and the factors relevant to the value to be determined and have experience in valuing mineral assets. If APB and AML are unable to agree on the appointment of the Expert by the end of such thirty (30) day period, then upon the request of either, the Expert shall be promptly appointed by a senior partner of KPMG (Toronto, Canada) or, if such person is not available to make such appointment, by the Centre for Expertise of the International Chamber of Commerce.  All costs incurred with respect to such appointment shall be borne equally by APB and AML. 

2.     Process of determination

Each of APB and AML shall, within the period of 15 Business Days from the date of appointment of the Expert be entitled to make oral and written submissions to the Expert provided always that all written submissions shall be copied at the same time to the other and that all oral submissions shall be made exclusively in meetings with the Expert at which a duly authorised representative of each of APB and AML is in attendance.

If the Expert shall require any factual clarification during the course of its valuation it shall notify each of APB and AML in writing and such matters as are raised shall be discussed in a meeting or meetings at which duly authorised representatives of each of APB and AML are present.

Within 10 Business Days following the later of the date of (i) receipt by the Expert of written submissions by APB and/ or AML, and (ii) any factual clarification meeting or meetings convened by the Expert, but in any event no later than 60 Business Days after appointment of the Expert, the Expert shall determine the valuation based on the criteria set forth in this Agreement applicable to the valuation and such other criteria as the Expert may consider appropriate.

Once the Expert has concluded its valuation in accordance with the previous paragraph it shall issue its certification in draft form to each of APB and AML each of which shall have 10 Business Days from the date of receipt of such draft certification to make written representations to the Expert (which representations shall be copied to the other) and either of APB and AML may, within such 10 day period, request a final meeting with the Expert at which representatives of each of APB and AML shall attend.

The Expert shall issue its final determination to each of the Parties within 15 Business Days of the date upon which it issued its draft certification (if there is no request for written submissions or a meeting) or, if representations are made or a meeting is held, within 15 Business Days of the later of the date of receipt of such representations by the Expert and the date of such meeting.

The Expert may, at its sole discretion, vary the process set out above, if it considers that so doing would facilitate the valuation.

3.     Costs of Expert

All costs incurred with respect to the services of the Expert shall be borne equally by APB and AML.

<PAGE>

SCHEDULE 3- PART A

INITIAL WORK PROGRAMME AND BUDGET

48

<PAGE>

SCHEDULE 3 - PART B

DESCRIPTION OF ACTUAL WORK AND EXPENDITURE 

 
<PAGE>

SCHEDULE 4

TRANSFER AND SUBSCRIPTION TERMS

The following terms and conditions are the terms which shall apply to subscriptions of Shares (including Option Shares) and sales of Company Loans and other Interests (in this Schedule, the "Interests") as provided in the Agreement:

1.     Timing - The completion of the purchase and sale of, or subscription for, the Interests shall occur as soon as practicable but in any event shall not occur later than seven Business Days after the obligation of purchase and sale or subscription arises under the Agreement.  

2.     Place of Completion - The completion shall occur at the registered office for the time being of the Company (or such other place as may be agreed between the Parties).

3.     Delivery Free of Encumbrances - The Interests shall be delivered by the seller to the purchaser, or by the Company to any subscriber, free and clear of any Encumbrances.

4.     Documentation - (i) In the case of a purchase and sale, the seller shall at completion deliver instruments representing the Interests together with, in the case of Shares, share transfer forms duly executed by the seller and such other documents as may, in the reasonable opinion of the purchaser, be necessary or desirable or required under Applicable Law in order for the purchaser (or such Affiliate of the purchaser as may be nominated by the purchaser by notice in writing delivered not less than two Business Days prior to completion) to become the registered and beneficial owner of the purchased Interests free and clear of any Encumbrances; and (ii) in the case of a subscription for Shares, the Company shall take all such steps (including convening an extraordinary shareholders'meeting) as may be necessary or required under Applicable Law in order for the subscriber (or such Affiliate of the subscriber as may be nominated by the subscriber by notice in writing delivered not less than two Business Days prior to completion) to become the registered and beneficial owner of the Shares free and clear of any Encumbrances, and at completion the Company shall deliver such documents as may be desirable in the opinion of the subscriber to evidence such ownership.

5.     Recording in Shareholders Register - In the case of a subscription for Shares, at completion the Parties shall procure that the subscriber (or such Affiliate of the subscriber as may be nominated by the subscriber by notice in writing delivered not less than two Business Days prior to completion) is recorded in the Register of Nominative Shares of the Company as the registered owner of such Shares. In the case of the purchase of Instruments comprising Shares, at completion the Parties shall procure that the purchaser (or such Affiliate of the purchaser as may be nominated by the purchaser by notice in writing delivered not less than two Business Days prior to completion), the seller and an officer of the Company effect the transfer of the Shares to the purchaser (or its Affiliate as aforesaid) by executing the transfer of shares in the Company's book for the Transfer of Nominative Shares and by a further registration in the Register of Nominative Shares.
<PAGE>

SCHEDULE 5

ENCUMBRANCES

1.     Royalty in favour of Săo Bento Mineracao S.A., a wholly owned subsidiary of Eldorado Gold Corporation, pursuant to a letter agreement dated 30 September 2003 payable on sales of mineral products arising from the exploitation of the geographic area encompassed by the following mineral rights.

	
Original claim no.
	
Original owner
	
Current claim no.
	
Current owner

	
800.470/96
	
Unamgem
	
800.478/06
	
PBM

	
800.483/96
	
Unamgem
	
800.481/06
	
PBM

	
800.446/96
	
Carnauba
	
800.475/06
	
PBM

	
800.458/96
	
Carnauba
	
800.476/06
	
PBM

	
800.459/96
	
Carnauba
	
800.477/06
	
PBM

	
800.471/96
	
Carnauba
	
800.479/06
	
PBM

	
800.482/96
	
Carnauba
	
800.480/06
	
PBM

	
800.495/96
	
Carnauba
	
800.482/06
	
PBM

	
800.507/96
	
Carnauba
	
800.483/06
	
PBM

	
800.520/96
	
Carnauba
	
800.484/06
	
PBM

Acronyms:

          Unamgem means Unamgem Mineracao e Metalurgia S.A..

          Carnauba means Carnaúba Mineracao Ltda..

          PBM means Pedra Branca do Brasil Mineracao Ltda..

PAGE>
SCHEDULE 6

MAP OF PROJECT AREA

<PAGE>
SCHEDULE 7

PEDRA BRANCA MINERAL RIGHTS

	
Owner
	
File no.
	
Alvara no.
	
Date 
	
Area (ha)
	
Application for renewal
	
Renewed on
	
Final Exploration Report
	
Remarks

	
Altoro
	
800.095/99
	
3911
	
12 January 2000
	
1000
	
4 November 2002
	
19 March 2003
	
20 March 2006
	
-

	
Altoro
	
800.096/99
	
2558
	
24 January 2000
	
1000
	
16 May 2003
	
26 April 2004
	
-
	
-

	
Altoro
	
800.097/99
	
5599
	
24 January 2000
	
1000
	
4 November 2002
	
19 March 2003
	
20 March 2006
	
-

	
Altoro
	
800.245/99
	
10976
	
10 May 2000
	
483,07
	
5 October 2004
	
16 February 2005
	
-
	
-

	
Altoro
	
800.112/00
	
6810
	
2 September 2003
	
8,06
	
-
	
30 June 2006
	
-
	
-

	
Altoro
	
800.119/01
	
6093
	
5 July 2001
	
2000
	
3 May 2004
	
10 August 2004
	
-
	
-

	
Altoro
	
800.121/01
	
6095
	
5 July 2001
	
2000
	
3 May 2004
	
11 August 2004
	
-
	
-

	
Danielle
	
800.069/06
	
2865
	
7 April, 2006
	
1000
	
-
	
-
	
-
	
4

	
Danielle
	
800.070/06
	
2866
	
7 April, 2006
	
1000
	
-
	
-
	
-
	
4

	
Danielle
	
800.071/06
	
2867
	
7 April, 2006
	
1000
	
-
	
-
	
-
	
4

	
Danielle
	
800.072/06
	
2868
	
7 April, 2006
	
1000
	
-
	
-
	
-
	
4

	
PBM3
	
800.378/06
	
9345
	
10 October 2006
	
1000
	
-
	
-
	
-
	
-

	
PBM
	
800.379/06
	
9346
	
10 October 2006
	
997,9
	
-
	
-
	
-
	
-

	
PBM
	
800.380/06
	
9347
	
10 October 2006
	
989,32
	
-
	
-
	
-
	
-

	
PBM
	
800.381/06
	
9348
	
10 October 2006
	
1000
	
-
	
-
	
-
	
-

	
PBM
	
800.382/06
	
9349
	
10 October 2006
	
161,65
	
-
	
-
	
-
	
-

	
PBM
	
800.383/06
	
9350
	
10 October 2006
	
423,56
	
-
	
-
	
-
	
-

	
PBM
	
800.384/06
	
9351
	
10 October 2006
	
1000
	
-
	
-
	
-
	
-

	
PBM
	
800.385/06
	
9352
	
10 October 2006
	
999,98
	
-
	
-
	
-
	
-

	
PBM
	
800.386/06
	
9353
	
10 October 2006
	
746,23
	
-
	
-
	
-
	
-

	
PBM
	
800.387/06
	
9354
	
10 October 2006
	
1000
	
-
	
-
	
-
	
-

	
PBM
	
800.388/06
	
9355
	
10 October 2006
	
1000
	
-
	
-
	
-
	
-

	
PBM
	
800.389/06
	
9356
	
10 October 2006
	
1000
	
-
	
-
	
-
	
-

	
PBM
	
800.390/06
	
9357
	
10 October 2006
	
1000
	
-
	
-
	
-
	
-

	
PBM
	
800.391/06
	
9358
	
10 October 2006
	
1000
	
-
	
-
	
-
	
-

	
PBM
	
800.392/06
	
9359
	
10 October 2006
	
1000
	
-
	
-
	
-
	
-

	
PBM
	
800.393/06
	
9360
	
10 October 2006
	
1000
	
-
	
-
	
-
	
-

	
PBM
	
800.394/06
	
9361
	
10 October 2006
	
1000
	
-
	
-
	
-
	
-

	
PBM
	
800.395/06
	
9362
	
10 October 2006
	
1000
	
-
	
-
	
-
	
-

	
PBM
	
800.396/06
	
9363
	
10 October 2006
	
1000
	
-
	
-
	
-
	
-

	
PBM
	
800.397/06
	
9364
	
10 October 2006
	
1000
	
-
	
-
	
-
	
-

	
PBM
	
800.398/06
	
9365
	
10 October 2006
	
1000
	
-
	
-
	
-
	
-

	
PBM
	
800.399/06
	
9366
	
10 October 2006
	
1000
	
-
	
-
	
-
	
-

	
PBM
	
800.400/06
	
9367
	
10 October 2006
	
1000
	
-
	
-
	
-
	
-

	
PBM
	
800.453/06
	
11285
	
5 December 2006
	
999,77
	
-
	
-
	
-
	
-

	
PBM
	
800.454/06
	
11286
	
5 December 2006
	
974,05
	
-
	
-
	
-
	
-

	
PBM
	
800.455/06
	
11287
	
5 December 2006
	
579,20
	
-
	
-
	
-
	
-

Applications for exploration licenses:

	
Applicant
	
File no.
	
Date of filing
	
Area (ha)

	
PBM
	
800.475/06
	
28 November 2006
	
(1000)

	
PBM
	
800.476/06
	
28 November 2006
	
(1000)

	
PBM
	
800.477/06
	
28 November 2006
	
(1000)

	
PBM
	
800.478/06
	
28 November 2006
	
(1000)

	
PBM
	
800.479/06
	
28 November 2006
	
(1000)

	
PBM
	
800.480/06
	
28 November 2006
	
(1000)

	
PBM
	
800.481/06
	
28 November 2006
	
(1000)

	
PBM
	
800.482/06
	
28 November 2006
	
(1000)

	
PBM
	
800.483/06
	
28 November 2006
	
(1000)

	
PBM
	
800.484/06
	
28 November 2006
	
(1000)

 

 
<PAGE>

SCHEDULE 8

REPRESENTATIONS AND WARRANTIES

1     Representations and Warranties of AML and Solitario - Each of AML and Solitario (a) represent and warrant to APB that as of the Effective Date the representations and warranties set forth in this Section 1.1 are true and correct (and such representations and warranties shall survive the execution and delivery of this Agreement and continue in full force and effect thereafter) and (b) acknowledges and confirms that APB is relying on such representations and warranties in entering into this Agreement:

1.1     The Company is a corporation duly incorporated and existing under the laws of Brazil and is duly qualified, licensed or registered to carry on business under the laws applicable to it in all jurisdictions in which the nature of its assets or business makes such qualification necessary or where failure to be so qualified would have a material adverse effect on its business or its ability to fulfil its obligations under this Agreement;

1.2     AML is a sociedade limitada duly incorporated and existing under the laws of Brazil and is duly qualified, licensed or registered to carry on business under the laws applicable to it in all jurisdictions in which the nature of its assets or business makes such qualification necessary or where failure to be so qualified would have a material adverse effect on its business or its ability to fulfil its obligations under this Agreement;

1.3     Each of AML, Solitario and the Company has all necessary corporate power and authority to enter into and perform this Agreement and any agreement and instrument referred to in or contemplated by this Agreement;

1.4     The execution, delivery and performance by AML, Solitario and the Company of this Agreement and any other agreement or instrument referred to in or contemplated by this Agreement have been duly authorised by all necessary corporate action on the part of AML, Solitario and the Company;

1.5     This Agreement and all other agreements or instruments to be executed and delivered by AML, Solitario or the Company hereunder have been (or shall be when executed and delivered) duly executed and delivered by AML, Solitario or the Company (as the case may be) and constitute (or shall constitute when executed and delivered) legal, valid and binding obligations of AML, Solitario or the Company (as the case may be) enforceable against AML, Solitario or the Company (as the case may be) in accordance with their respective terms;

1.6     Compliance by AML, Solitario and the Company with the terms of this Agreement and the documents referred to in it shall not breach or constitute a default under (i) any provision of the articles of association and by-laws or equivalent constitutional documents of AML, Solitario or the Company, (ii) any agreement or instrument to which AML, Solitario or the Company is a party or by which it is bound or (iii) any order, judgment, decree or other restriction applicable to AML, Solitario or the Company;

1.7     The authorised share capital of the Company consists of Reais 4 012 575.00 divided into 4 012 575  Shares of Reais 1.00 each;

1.8     4 012 575 Shares have been allotted and issued, are fully paid up and are outstanding, legally and beneficially owned by AML free of any Encumbrance, and no commitment has been given by AML, Solitario or the Company to sell, transfer or assign any ownership interest in any issued or unissued Shares or other securities of the Company (except as provided in this Agreement) or create an Encumbrance affecting any issued or unissued Shares or other securities of the Company and no person has claimed any rights in connection with any of those things;

1.9     The Company (i) does not hold or beneficially own, and has not agreed to acquire, any securities of any corporation, (ii) has not agreed to become a member of any partnership or 

54

<PAGE>

other unincorporated association, joint venture or consortium and (iii) does not have any branch or permanent establishment outside of Brazil;

1.10     Prior to the date hereof the Company has not carried on any business and is not a party to any contracts except in connection with the Pedra Branca Project;

1.11     The Company has not incurred any Expenditures (other than Eligible Initial Investment Costs) or incurred any liabilities;

1.12     The copies of the articles of association and by-laws of the Company provided to APB in connection with the execution of this Agreement are true, accurate and complete in all respects and copies of all the resolutions and agreements required to be annexed to or incorporated in those documents by Applicable Law are annexed or incorporated;

1.13     All statutory books and registers of the Company have been properly kept and no notice or allegation that any of them is incorrect or should be rectified has been received by the Company;

1.14     All returns, particulars, resolutions and other documents which the Company is required by law to file with or deliver to any authority in any jurisdiction have been correctly made up and filed or, as the case may be, delivered;

1.15     Each of AML and Solitario have delivered to APB all relevant data and information in its possession or under its control (including all Mining and Prospecting Information) relating to the Company, AML, the Properties and the mineral potential of the Project Area;

1.16     All written information relating to the Company and the Pedra Branca Mineral Rights which shall have been provided by AML and/or Solitario or their respective directors, employees, advisors or agents in connection with this Agreement, including the information set out in the Recitals to this Agreement and the information provided pursuant to the Framework Agreement shall be accurate in all material respects and shall not omit to state any fact necessary to make such information not misleading;

1.17     No Director or officer of the Company or any other person has entered into any agreement or contract with the Company for the provision of services  (whether or not in writing) under which such director, officer or other persons are employed or otherwise retained by the Company;

1.18     So far as AML and Solitario are aware, there is no any information that has not been disclosed in writing to APB which would in the reasonable opinion of AML and Solitario be material for a prudent purchaser or subscriber of an interest in, or lender to, the Company;

1.19     Solitario, AML and the Company have at all times conducted their respective businesses, including the acquisition of rights in relation to the Pedra Branca Project and all Exploration activities in the Project Area, in accordance with all Applicable Laws;

1.20     The Company does not hold any direct or indirect right, title or interest in, or any right to acquire any right, title or interest in, any mineral exploration project or any exploration or mining right or licence other than in connection with the Pedra Branca Project;

1.21     The Company has all Authorisations necessary to carry on its business, all of which are valid and subsisting.  As far as AML is aware there is no reason why any of those Authorisations should be suspended, cancelled, revoked or not renewed on the same terms;

1.22     The Company (i) is not engaged in any litigation, administration, mediation or arbitration proceedings (except for debt collection in the normal course of business) and (ii) so far as AML is aware is not the subject of any investigation, inquiry or enforcement proceedings by any Governmental Authority.  So far as AML is aware, no such proceedings, investigation or inquiry have been threatened or are pending and there are no circumstances likely to give rise to any such proceedings.  The Company is not affected by any existing or pending judgments or rulings and has not given any undertakings arising from legal proceedings to a court, Governmental Authority or other third party;

1.23     Without limiting the generality of Section 1.22 above so far as AML is aware (i) 

55

<PAGE>

neither the Company is nor its Affiliates are involved in any disputes (whether or not resulting in litigation, administration, mediation or arbitration proceedings) relating to any right or licence to conduct Exploration or Mining activities in the Project Area and (ii) no person has asserted any right, title or interest in any right or licence to conduct Exploration or Mining activities in the Project Area and which will or might adversely affect the Company;

1.24     Except for the Properties and the Framework Agreement, the Company is not a party to or subject to any agreement or arrangement which (i) is a material contract, (ii) is of an unusual or exceptional nature, (iii) is not in the ordinary and usual course of the Business, (iv) may be terminated as a result of any change of control (howsoever defined) of the Company or its Affiliates or (v) restricts the freedom of the Company to carry on the whole or any part of the Business in any part of the world in such manner as it thinks fit, other than as contemplated in this Agreement;

1.25     So far as AML and Solitario are aware, no person has any right, title or interest (including the right to conduct Exploration or Mining activities) in, under or in respect of the Pedra Branca Mineral Rights, the Properties or the Project Area, other than the right, title and interest of the Parties to the Pedra Branca Mineral Rights as expressly set out  therein;

1.26     Each of the Pedra Branca Mineral Rights has been duly applied for by or on behalf of the Company, has been duly granted by the DNPM, is validly held under Applicable Law by the Company, and is in full force and effect and binding on the parties to it;

1.27     The Company has not defaulted under or breached any of the Pedra Branca Mineral Rights and so far as AML and Solitario are aware no other party to any of the Pedra Branca Mineral Rights has defaulted under or breached any such rights and no such default or breach by the Company or any other party is likely or has been threatened;

1.28     No Governmental Authority has made any proposal or taken any action or proceedings in connection with any Pedra Branca Mineral Rights which would or might adversely affect the rights of the Company thereunder;

1.29     No notice of termination of any of the Pedra Branca Mineral Rights has been received or served and, so far as AML and Solitario are aware, there are no grounds for determination, rescission, avoidance or repudiation of any such rights;

1.30     The Company does not have any liabilities (contingent or otherwise) other than those arising from commitments under the First Work Programme and Budget and the Company has no unrealised or anticipated losses arising from commitments entered into by it;

1.31     So far as AML and Solitario are aware, no environmental, reclamation or abandonment obligations or work orders or other liabilities presently exist with respect to the Pedra Branca Mineral Rights or the Project Area and there is no basis for any such obligations or liabilities to arise in the future except in connection with the development of the Pedra Branca Project;

1.32     All financial, statutory and other records of the Company (i) have been properly prepared and maintained, (ii) do not contain any material inaccuracies or discrepancies and (iii) are in the possession of the Company; 

1.33     The Company is the owner of the properties and assets represented to APB as being the properties and assets of the Company free and clear of any Encumbrance or other rights of third parties, other than those set out in Schedule 5 (Encumbrances); and

1.34     The Company has no Subsidiaries.

2.     Representations and Warranties of APB and RPM - Each of APB and RPM (a) represent and warrant to AML that as of the Effective Date the representations and warranties set forth in this Section 2 are true and correct (and such representations and warranties shall survive the execution and delivery of this Agreement and continue in full force and effect thereafter) and (b) acknowledges and confirms that AML is relying on such representations and warranties in entering into this Agreement:

56

<PAGE>

2.1     APB is a corporation duly incorporated and existing under the laws of Brazil and is duly qualified, licensed or registered to carry on business under the laws applicable to it in all jurisdictions in which the nature of its assets or business makes such qualification necessary or where failure to be so qualified would have a material adverse effect on its business or its ability to fulfil its obligations under this Agreement;

2.2     APB and RPM have all necessary corporate power and authority to enter into and perform this Agreement and any agreement and instrument referred to in or contemplated by this Agreement;

2.3     The execution, delivery and performance by each of APB and RPM of this Agreement and any other agreement or instrument referred to or contemplated by this Agreement  and delivered by it hereunder have been duly authorised by all necessary corporate action on the part of APB and RPM;

2.4     This Agreement and all other agreements or instruments to be executed and delivered by APB and RPM hereunder have been (or shall be when duly executed and delivered) duly executed and delivered by APB and RPM and constitute (or shall constitute when executed and delivered) legal, valid and binding obligations of APB and RPM enforceable against APB and RPM in accordance with their respective terms; and

2.5     Compliance by each of APB and RPM with the terms of this Agreement and the documents referred to in it shall not breach or constitute a default under; (i) any provision of its articles of association and by-laws or equivalent constitutional documents, (ii) any agreement or instrument to which it is a party or by which it is bound or (iii) any order, judgment, decree or other restriction applicable to it.

3.     Representations and Warranties Relating to Options and Option Shares - Upon the granting of any Option hereunder by any Party (the "grantor") and upon the exercise thereof by the person (the "grantee") entitled to do so hereunder, the grantor; (a) shall be deemed to have represented and warranted to the grantee that the representations and warranties set forth in this Section 3 are true and correct as at such time (and such representations and warranties shall survive the granting of the relevant Option and the subscription for the relevant Option Shares and continue in full force and effect thereafter) and (b) acknowledges and confirms that the grantee is relying on such representations and warranties in entering into this Agreement, making Advances and exercising the relevant Option: 

3.1     The grantor has all necessary corporate power and authority to grant the relevant Option and to perform its obligations relating thereto;

3.2     Compliance by the grantor with the relevant Option shall not breach or constitute a default under (i) any provision of the articles of association and by-laws or equivalent constitutional documents of the grantor, (ii) any agreement or instrument to which the grantor is a party or by which it is bound or (iii) any order, judgment, decree or other restriction applicable to the grantor;

3.3     The relevant Option constitutes the legal, valid and binding obligation of the grantor enforceable against the grantor in accordance with its terms;

3.4     The Option Shares covered by the relevant Option shall be validly allotted and issued as fully paid up shares free of any Encumbrance, and subject to no commitment by the Company to issue such Option Shares (except pursuant to the relevant Option) or create an Encumbrance affecting such Option Shares; and

3.5     Upon the exercise by the grantee of its right to subscribe for the Option Shares covered by the relevant Option and the payment of the exercise price therefore, the grantee (or its nominated Affiliate) shall become the sole legal and beneficial owner of such Option Shares (including all voting and other rights relating thereto) free and clear of any Encumbrance or other rights of any person (except as provided in this Agreement).

<PAGE>

SCHEDULE 9

ELIGIBLE INITIAL INVESTMENT COSTS

58FRAMEWORK AGREEMENT FOR THE EXPLORATION AND POTENTIAL DEVELOPMENT OF MINING PROPERTIES

Exhibit 10.2

FRAMEWORK AGREEMENT FOR THE EXPLORATION AND POTENTIAL DEVELOPMENT OF MINING PROPERTIES

This private document, framework agreement for the exploration and potential development of mining properties, is entered into by and between:
MINERA BONGARA S.A., with RUC No. 20461523014 and domicile at El Bucare 573, Camacho, La Molina, Lima, Peru registered in file No. 41231 of the Registry of Legal Entities of Lima, duly represented by its President of the Board Directors, Mr. Walter Henry Gage Hunt, identified with United States Passport number 710016643, as per power of attorney registered in file No. 11907446, entry C0004 of the above mentioned Registry (hereinafter "BONGARA"); and,

MINERA SOLITARIO PERU S.A.C. with RUC No. 20462014181 and domicile at El Bucare 573, Camacho, La Molina, Lima, Peru,, registered in card No. 41244 of the Registry of Legal Entities of Lima, duly represented by its President of the Board of Directors, Mr. Walter Henry Gage Hunt, identified with United States Passport number 710016643 as per power of attorney registered in file No. 11396340, entry C0008 of the above mentioned Registry (hereinafter "MINERA SOLITARIO").  

SOLITARIO RESOURCES CORP., a company existent and incorporated under the laws of the United States, domiciled at 4251 Kipling St, Suite 390 Wheat Ridge, CO 80033, USA, duly represented by its President, south America Operations, Mr. Walter Henry Gage Hunt, identified with United States Passport number 710016643 (hereinafter "SOLITARIO RESOURCES").

Where used in this Agreement MINERA SOLITARIO shall mean collectively MINERA SOLITARIO S.A.C., SOLITARIO RESOURCES CORP. and BONGARA; and,
VOTORANTIM METAIS - CAJAMARQUILLA S.A., with RUC No. 20261677955 and domicile at Paz Soldan 170 of # 501, San Isidro, Lima 27, Peru, registered in file No. 11369441 of the Registry of Legal Entities of Lima, duly represented by its Financial Manager, Mr. Jorge Paulo Rodriguez del Gaizo, identified with CE No. 000262334, and by Mr. Alberto Gazzo Baca, identified with Identity Card No. 06445664, as per power of attorney registered in entry C00020 and C00021 of the file of above mentioned Registry (hereinafter "VOTORANTIM").

This contract is entered upon the following terms and conditions:

One:          Definitions

1.1     Affiliates and Subsidiaries
Affiliates and Subsidiaries shall mean:

A company, partnership or corporation that is owned in more than 50% by one of the Parties hereto or is controlled by one of the Parties.

A company, partnership or holding that is owner of more than 50% or controls one of the Parties hereto.

For the purposes of the definition of "control" referred to under this section, the Parties hereby expressly agree that control shall mean the right to exercise, directly or indirectly, voting rights regarding the shares or interests of the controlled company which may allow the adoption by the latter of resolutions or valid decisions without being required the attendance or participation of entities or persons who hold, directly or indirectly, additional votes.  

Likewise, control shall mean the holding, directly or indirectly, of the power to manage or provide for the management and the policies of the controlled company by means of the title on shares or interests, other voting securities, contracts, voting trusts or by any other mean.

1.2     Agreement
This agreement, its possible amendments and annexes.

1

<PAGE>

1.3     Area of Interest
The area located within two (2) kilometers from the boundaries of any of the mining rights forming part of the Properties.

1.4     Cash Calls 
On the basis of adopted Programs and Budgets, the General Manager of BONGARA shall submit to each Party, at least fifteen (15) calendar days before March 31, June 30, September 30 and December 31 of each year, a request for the delivery by each Party of the estimated cash and environmental compliance fund requirements that they are required to contribute to BONGARA for the following quarter.  Within fifteen (15) calendar days after receipt of each request, each Party shall advance to BONGARA its proportionate share of the estimated amount. Time is of the essence of payment of such billings.  The General Manager of BONGARA shall at all times maintain a cash balance approximately equal to the rate of disbursement for up to two (2) months. After a decision has been made to begin construction and development activities in the Properties, all funds in excess of immediate cash requirements shall be invested in interest-bearing accounts for the benefit of BONGARA. 

1.5     Commercial Production
Commercial Production shall mean the operations of mining and processing on the Properties or some part of the same, in accordance to the respective Feasibility Study, but it does not include the testing operations or the operations at a pilot plant.  It shall be deemed that Commercial Production has began the first day of the month following the first thirty (30) consecutive calendar days during which mineral concentrates have been produced at the Property at an average rate of not less than seventy  per cent (70%) of the classified initial capacity of the mining facilities.

1.6     Continuing Obligations 
Means obligations or responsibilities that pertain to the terminating Party's activities that are reasonably expected to continue or arise after termination of the Agreement or after operations on the Properties have ceased or are suspended, including, but not limited to, required ongoing environmental compliance that is mandated by law or permit, reclamation, taxes and social benefits of employees and accounts payable for work conducted on, or for the benefit of the Property that were incurred prior to the effective date of termination.

1.7     FIRST OBLIGATION TO CAPITALIZE
It is the obligation undertaken by MINERA SOLITARIO referred to in section 7.1 that will only be enforceable if VOTORANTIM complies with the conditions set forth in this Agreement for those effects. Performance of this obligation by MINERA SOLITARIO, will allow VOTORANTIM to earn in a 61% interest in the capital stock of BONGARA.

1.8     Feasibility Study 
Means a detailed report prepared by or on behalf of the General Manager that recommends to the Board of Directors the development of a commercial mining operation on a portion of the Properties and includes at least the following information: (i) a description of the Properties to be covered by the proposed mine; (ii) the estimated recoverable reserves of minerals using an internationally recognized method of computing reserves such as National Instrument 43-101 or JORC and the estimated composition and content thereof; (iii) the proposed procedure for development and mining production; (iv) the results of ore amenability tests; (v) the nature and extent of the mine facilities proposed to be constructed or acquired which may include mill facilities, if the size, extent and location of the ore body makes such mill facilities feasible, in which event the report shall also include a preliminary design for such mill; (vi) the total costs, including capital Budget, which are reasonably required to

2

<PAGE>
 purchase, construct and install all structures, machinery and equipment required for the proposed mine, including a schedule of timing of such requirements; (vii) summary of environmental impact studies deemed necessary by the Manager and costs thereof; (viii) the period in which it is proposed that the Properties be brought into commercial production; (ix) such other data and information as are reasonably necessary to substantiate the existence of a mineral deposit of sufficient size and grade to justify development of a mine, taking into account all relevant business, tax and other economic considerations; and (x) a schedule of working capital requirements for the construction and initial operation of the Properties as a mine.  The Feasibility Study shall be in such form as industry standards and VOTORANTIM customarily requires for purposes of determining the advisability of proceeding with the development of a commercial mining operation.

1.9     Initial Capital 
Shall mean the amount of the registered capital stock of BONGARA immediately after the date in which the Shareholders, as provided in section 9.2, shall bear any and all investments and expenses required by BONGARA in a pro rata basis in accordance with their shareholding interest in BONGARA.

1.10     Initial Date 
The Initial Date is the 4th of August, 2006, the date in which the Letter of Agreement was executed. 

1.11     Letter of Agreement 
Shall mean the Letter of Agreement Relating to the Florida Canyon Project dated August 4, 2006 between VOTORANTIM METAIS - CAJAMARQUILLA S.A., MINERA BONGARA S.A. and SOLITARIO RESOURCES CORPORATION.

1.12     Operator 
Operator shall have the meaning as defined in section 14.1.

1.13     Party or Parties 
Shall mean the parties to this Agreement.

1.14     Programs and Budgets 
It has the meaning as defined in clause twelve.

1.15     Property or Properties

Are the mining properties described in Annex A which is an integral part hereof, as well as those that may be obtained by BONGARA or by any of the Parties as per the provisions hereunder.

1.16     Qualified Expenditures 
It shall have the meaning defined in section 7.7.1.

1.17     SECOND OBLIGATION TO CAPITALIZE
It is the obligation undertaken by MINERA SOLITARIO in accordance to section 7.6 that will be enforceable once VOTORANTIM complies with the conditions set forth in this Agreement for those effects. Performance of this obligation by MINERA SOLITARIO, will allow VOTORANTIM to earn in an additional 9% interest in the capital stock of BONGARA, so that it holds an aggregate 70% shareholding interest in BONGARA.

1.18     Shareholder 
It shall mean a Shareholder of BONGARA.

1.19     Validity Fees 
Shall mean payments to Peruvian governmental entities required for maintaining the Property in good standing and shall include "Derechos de Vigencia" (maintenance fees payments) and "Penalidades" (penalties applied for not reaching the minimum production standards established by law) and any other such fees as shall be levied in the future for purposes of maintaining the good standing and validity of the Properties.

3

<PAGE>

Two:          Representations of the Parties
2.1          The Parties hereby represent, covenant and warrant to the other:
That they are duly established companies, with enough legal capacity to enter into and perform their obligations under this Agreement, provided that they have taken all necessary action to authorize the execution, delivery and performance of this Agreement in accordance with the terms and conditions hereof, and that the persons signing this document on their behalf have been duly authorized and are empowered to do so.

That they make no express or implied representations, covenants or warranties of any type, including any representations, covenants or warranties with respect to title to or rights under the Properties, except as specifically set forth herein.

That they will breach no other contract or agreement upon entering into or executing this instrument, and any and all the terms and conditions agreed upon hereunder by the Parties are valid and, therefore, its fulfillment is compulsory for them.

During the term of this Agreement, the Parties will keep the Properties free from any lien or charge that may arise as a result of their respective actions, assuming in any event the corresponding individual responsibility and the obligation to cure said situation, bearing the cost of it.

2.2     MINERA SOLITARIO hereby represents and guarantees to VOTORANTIM the following:
The Properties occupy 4,100 Has.

        BONGARA holds 100% of the following Properties:

	
Name
	
Code

	
Bongara Veintisiete
	
01-07835-95

	
Bongara Cincuenticuatro
	
01-02332-96

	
Bongara Cincuenticinco
	
01-02333-96

That even though the following Properties do not currently appear registered under the name of BONGARA, full legal title to and in connection to them, and all legal rights derived there from, shall be acquired by BONGARA prior to the execution of the Mining Assignment Agreement:

	
Name
	
Code

	
Del Piero Tres
	
01-03386-05

	
Del Piero Cuatro
	
01-00002-06

	
Del Piero Cinco
	
01-00003-06

The Properties are free of any lien or charge, registered or not. It also represents that there are no claims from third parties on the Properties which settlement may be pending or, as far as it may be reasonably foreseen, there are no claims, objections or rights which may be filed by third parties and which may affect the Properties.

BONGARA is not party to any agreement or option or to any other class of agreement in relation to all or some of the Properties. Likewise, BONGARA has no negotiations with third parties on the Properties that may affect them somehow.

MINERA SOLITARIO PERU S.A.C. represents that it controls 100% of the shares of BONGARA and warrants that it shall cause BONGARA to perform all of the obligations required of it under this Agreement.

The declarations and representations contained in Annex E hereto.
2.3     VOTORANTIM hereby represents and guarantees to MINERA SOLITARIO the following:

4

<PAGE>

Any and all works and activities to be performed at the Properties shall be made in accordance with high mining practices and professional standards, complying with Peruvian laws and regulations, with no limitation whatsoever, including those related to environmental issues, such as the prevention of any type of pollution and the performance of environmental remediation works, and those necessary to keep the Properties in good standing.

It will defend the Properties against any claim, request or procedure filed by third parties which may affect in any way the rights of BONGARA on the Properties.  Likewise, VOTORANTIM will report to the pertinent authorities any overlapping, invasion or direct or indirect threat against the right of possession or title on the Properties which may exist in relation to the same, and will make its best efforts to terminate and/or eliminate such overlapping, invasions or threats.

During the effectiveness of the Agreement for so long as it is Operator, it will keep the Properties free from any environmental contingency of any nature, which may arise as a consequence of its activities at the same and will keep the Properties free from any lien or charge that may arise as a result of its respective actions, being responsible for complying with the Continuing Obligations.

It has relied solely on its own appraisals and estimates as to the mineral potential of the Properties, and upon its own geologic, engineering and other interpretations related thereto.

2.4     Any material falseness, inaccuracy or non-fulfillment of any of the representations and provisions hereunder will empower the damaged Party to terminate this contract under section 23.2 hereof.

Three:          Purpose
3.1     On August 4, 2006, VOTORANTIM executed with BONGARA, SOLITARIO RESOURCES CORPORATION and MINERA SOLITARIO PERU S.A.C. the Letter of Agreement to set forth the general terms that would govern their relationship over the Properties.

Therefore, the purpose hereof is to complement and develop the terms of the Letter of Agreement and, consequently, establish the definite relations and obligations between the Parties for the exploration and evaluation and possible development and exploitation of the Properties.

3.2     For the purposes of article 8 of the Peruvian Companies Act, this Agreement will be registered by BONGARA immediately after the latter's incorporation is formalized. 

Four:          Term

The term hereof will commence as of the date of execution and will continue effective during the time the Mining Assignment Agreement referred to in clause six is effective and, then, it will extend its effectiveness if VOTORANTIM has earned-in a shareholding interest in BONGARA until such time as it may be terminated according to the provisions of clause twenty two, or, as applicable, as long as any Party holds the net smelter royalty referred to in section 11.3 herein.

Five:          SPECIFIC COMMITMENTS, DECLARATIONS AND REPRESENTATIONS IN CONNECTION TO BONGARA
5.1     Immediately subsequent to the execution of this document, MINERA SOLITARIO shall cause BONGARA to call and execute a Shareholders' Meeting by means of which it will:

(i)     Approve the execution of this Agreement and of the Mining Assignment Agreement referred to in clause six; and,

5

<PAGE>
(ii)     Approve all the necessary resolutions in order to substitute BONGARA's bylaws with those included in Annex B herein.

5.2     As from the date hereof and until the date in which BONGARA will assume control and responsibility over the Properties and the activities undertaken in them as provided in section 9.1, MINERA SOLITARIO shall cause (including, but not be limited to, not issuing instructions contrary to the agreed conduct of business hereunder and giving its approval or rejection as required as shareholders or due to its control over BONGARA) to procure that BONGARA:

5.2.1     Shall carry on its business in all material respects as a going concern in the ordinary and usual course, save in so far as agreed in writing by VOTORANTIM;

5.2.2     Shall conduct its business in all material respects in accordance with all applicable laws and regulations and good business practice;

5.2.3Without prejudice to the generality of section 5.2.1, shall not, without the prior written consent of VOTORANTIM or except as otherwise expressly contemplated in this Agreement:
a.     enter into any agreement or incur any commitment involving any expenditure in excess of US$ 5,000.00 (five thousand and 00/100 Dollars of the United States of America) per item and US$ 25,000.00 (twenty five thousand and 00/100 Dollars of the United States of America) in aggregate, in each case exclusive of any applicable General Sales Tax (IGV);

b.     enter into or amend any agreement or incur any commitment which is not capable of being terminated without compensation at any time or which is not in the ordinary course of business or which involves or may involve total annual expenditure in excess of US$ 25,000.00 (twenty five thousand and 00/100 Dollars of the United States of America), exclusive of IGV;

c.     acquire or dispose of, or agree to acquire or dispose of the Properties or, in general, of any material asset;

d.     take any action that would result in the failure or non-fulfilment of any condition set forth in this Agreement;

e.     acquire or agree to acquire any share, shares or other interest in any company, partnership or other venture;

f.     enter into any joint venture, partnership or long-term or unusual trading relationship or any agreement with any third party relating to the conduct of the business of BONGARA;

g.     incur any additional third party borrowings or incur any other indebtedness;

h.     repay any outstanding indebtedness prior to its due date;

i.     incur any intra-group indebtedness;

j.     create, allot or issue, or grant an option to subscribe for, any share capital of BONGARA;

k.     issue, sell, pledge, dispose of or encumber, or authorize or propose the issuance, sale, pledge, disposition or encumbrance of, any shares of BONGARA, or securities convertible or exchangeable for, or options, puts, warrants, calls commitments or rights of any kind to acquire, any of BONGARA's share capital or subdivide or in any way reclassify any shares of BONGARA's capital stock or change or agree to change in any manner the rights of its outstanding share capital;

l.     repay, redeem or repurchase any share capital of BONGARA;

6

<PAGE>
m.     declare, make or pay any dividend or other distribution (whether in cash, stock or property) to BONGARA's shareholders;

n.     delay making payment to any creditors generally beyond the date on which payment of the relevant debt should be paid in accordance with credit period authorised by the relevant creditors (or (if different) the period extended by creditors in which to make payment);

o.     amend, to any material extent, any of the terms on which goods, facilities or services are supplied;

p.     employ any employee;

q.     in relation to the Properties:
i.     carry out any material structural alteration or addition to, or materially effect any change of use of, the Properties, unless authorized by VOTORANTIM;

ii.     terminate or serve any notice to terminate, surrender or accept any surrender of or waive the terms of any lease, tenancy or licence which is material in the context of BONGARA;

iii.     agree any new rent or fee payable under any lease, tenancy or licence which is material in the context of BONGARA;

iv.     enter into or vary any agreement, lease, tenancy, licence or other commitment which is material in the context of BONGARA;

v.     sell, convey, transfer, assign or charge the Properties or grant any rights or easements over any of them or enter into any covenants affecting any Property or agree to do any of the foregoing;

r.     enter into any guarantee, indemnity or other agreement to secure any obligation of a third party or create any encumbrance over any of BONGARA's assets or undertaking in any such case;

s.     make any change to its accounting practices or policies or amend its constitutional and/or organisational documents.

t.     merge or consolidate with or into any other party.

5.3     Notwithstanding sections 5.6 and 5.7 and without prejudice to its right to claim damages or other compensation, if MINERA SOLITARIO is in breach of any of its undertakings in section 5.2 above, VOTORANTIM shall be entitled to terminate this Agreement in accordance to section 22.2.

5.4     Notwithstanding sections 5.6 and 5.7 and without prejudice to its right to claim damages or other compensation if prior to the date in which BONGARA will assume control and responsibility over the Properties and the activities undertaken in them as provided in section 9.1, any event shall occur which has or is reasonably likely to have an adverse effect on the reputation, goodwill, turnover, profitability or financial or trading position of BONGARA, the Properties or its assets, VOTORANTIM shall be entitled to terminate this Agreement in accordance to section 22.2.  

5.5     As from the date hereof, MINERA SOLITARIO shall provide and their respective officers, directors, employees, representatives and authorised agents to provide to VOTORANTIM and its officers, directors, employees, accountants, counsel, advisors and authorised agents, access to:

5.5.1     the officers, directors, employees, authorised agents, advisors, representatives and Properties of BONGARA; and 

5.5.2     all books, records and documents of BONGARA and shall promptly furnish to VOTORANTIM all financial and operating data and other information regarding the business and the assets of BONGARA that VOTORANTIM may from time to time reasonably request. VOTORANTIM shall be entitled to take copies of the referred books, records and documents as it may deem convenient.

7

<PAGE>
5.6     MINERA SOLITARIO shall indemnify VOTORANTIM in respect of and hold it harmless from and against, any and all losses resulting from, arising out of or relating to any misrepresentation, breach of warranty or non-fulfillment of or failure to perform any covenant or agreement on the part of MINERA SOLITARIO in this Agreement.

VOTORANTIM shall indemnify MINERA SOLITARIO in respect of and hold it harmless from and against, any and all losses resulting from, arising out of or relating to any misrepresentation, breach of warranty or non-fulfillment of or failure to perform any covenant or agreement on the part of VOTORANTIM in this Agreement.

In addition, until the date in which BONGARA will assume control and responsibility over the Properties and the activities undertaken in them as provided in section 9.1, MINERA SOLITARIO hereby undertakes to indemnify and keep indemnified VOTORANTIM from and against any diminution in the value of BONGARA, as a result of any loss or liability of any kind suffered by BONGARÁ as a consequence of Minera Solitario performing acts contrary to its obligations and or because of Minera Solitario not performing diligently its duties defined herein including, but not limited to, any diminution in the value of the assets of BONGARA, any payment made or required to be made by BONGARA and any costs incurred as a result of or in connection with any actions, proceedings, claims or demands resulting from or by reference to:  
(i)     Any tax on income, profits or gains earned, accrued or received on or before, or in respect of a period ending on or before the date in which BONGARA will assume control and responsibility over the Properties and the activities undertaken in them as provided in section 9.1 of the Agreement, or as a consequence of any event which occurred on or before that date; 

(ii)     All taxes, fees, interests, rights, contributions and municipal taxes of any kind, arising before or in respect to a period ending on or before the date referred in (i) above or as a consequence of any event which occurred on or before that date except as provided for in section 6.7;

(iii)     Employee benefits, salaries, wages, commissions, remunerations, gratifications, compensations, severance payments and social security payments, bonuses, benefit arrangements, including those that may be raised by any employee, agent, advisor, contractor or sub-.contractor hired by BONGARA, arising before or in respect to a period ending on or before the date referred in (i) above or as a consequence of any event which occurred on or before that date; and,

(iv)     Labor complaints, actions or disputes, arising before or in respect to a period ending on or before the date referred in (i) above or as a consequence of any event which occurred on or before that date.

The obligations to indemnify under this section 5.6 will be enforceable whether the events mentioned therein arise alone or in conjunction with other circumstances and whether or not the corresponding taxation or labor claim is chargeable against or attributable to any other person.

Six:          Mining Assignment Agreement
6.1     Within ten (10) calendar days as from the date on which VOTORANTIM receives from BONGARA copy of the certificates issued by the Public Registry evidencing the recording of all of the Properties under the name of BONGARA, MINERA SOLITARIO will cause BONGARA to execute a Mining Assignment Agreement for the term necessary for VOTORANTIM to be allowed to complete an overall and cumulative investment of US$ 18'000,000.00 in Qualified Expenditures in the Properties, and during the term necessary for VOTORANTIM to make the decisions that will allow it to deliver to MINERA SOLITARIO the notices referred to in sections 7.3.2 and 7.3.3.

8

<PAGE>
Said Mining Assignment Agreement, which is made an integral part hereof as Annex C, will be automatically terminated, without need of any further formality or declaration, as of the date in which: 
     VOTORANTIM has completed and overall and cumulative investment of US$ 18'000,000.00 in Qualified Expenditures in the Properties and delivered the notices referred to in sections 7.3.2 and 7.3.3; 

     VOTORANTIM waives its right to request MINERA SOLITARIO to perform the FIRST OBLIGATION TO CAPITALIZE or if it is deemed that it has waived it; 

     as provided in clause twenty two, in the event of termination of this Agreement; or,

     as otherwise provided in this Agreement. 

6.2     In consideration for the mining assignment granted in its favor, VOTORANTIM shall pay US$ 5,000.00 (five thousand and 00/100 American Dollars) to BONGARA.  This amount includes the corresponding General Sales Tax (IGV) and will be paid by VOTORANTIM concurrently with the payment referred to in section 7.4.1(i). The payment will be made through the delivery of a certified check issued in favor of BONGARA.

6.3     During the term of the Mining Assignment Agreement, VOTORANTIM will be responsible for the activities conducted at the Properties.  

6.4     During the term of the Mining Assignment Agreement, VOTORANTIM may perform any and all prospecting, exploration and assessment works that it may deem appropriate, with no limitation whatsoever, provided that it will be the only Party entitled to carry out activities related to the Properties.

6.5     VOTORANTIM will be entitled to take from the Properties mineral and metallic samples with the sole purpose of making tests and assays as well as to build, bring to and install therein any and all buildings, machinery, equipment and supplies which, at its discretion, may be deemed required and appropriate to carry out the activities described in sections 6.6 and 6.7.

6.6     In general terms, BONGARA shall grant VOTORANTIM during the effective term of the Mining Assignment Agreement, but not limited to, the following rights and faculties:
a.      The right to enter into the Properties and use any and all the rights of way and access means.

b.      To perform prospecting, exploration and assessment activities, using any method known at present or which may be developed in the future.

c.      To build, use, maintain, repair, relocate or replace roads, drilling sites, buildings, fences, power and communication lines, structures, camps, field offices and other facilities or infrastructure which may be helpful or which may be appropriate for VOTORANTIM in the performance of its exploration activities.

d.      To extract and remove from the Properties non-commercial quantities of ore, with the purpose of testing them (including, but not limited to, bulk samples, tests, geo-chemical analysis, the possibility of being taken to crushers and the determination of the recovery, pilot plants, test operations or similar activities). The exercise of this right does not involve the obligation to make any payment to BONGARA. 

e.      The right to use water rights related to the Properties in relation to the performance of exploration activities.

f.      To exercise any and all the rights that may be attached or usually related to the activities related to the rights granted, expressly or implicitly, to VOTORANTIM hereunder.

9

<PAGE>
6.7     In its capacity of mining assignee of the Properties, VOTORANTIM hereby undertakes the following obligations:

6.7.1     To carry out any and all works at the Properties in a way consistent with good exploration practices and high professional standards for said activities, complying with all the applicable laws and regulations, without limitation, holding harmless MINERA SOLITARIO and BONGARA from any and all the claims that may arise as the result of the activities conducted by VOTORANTIM in the Properties;

6.7.2     Allow MINERA SOLITARIO the unrestrictive access to the Properties and to all the records kept by VOTORANTIM, at its own risk and cost. With respect thereof, VOTORANTIM shall maintain proper and complete records and accounts of all the expenditures and works made with regard to the Properties, in accordance with accounting principles and standards generally accepted in the mining industry and applicable law. Such records and accounts shall be made available for MINERA SOLITARIO's review and audit at any time the latter requests them, provided that the costs of any such review or audit will be assumed entirely by MINERA SOLITARIO.

Likewise, VOTORANTIM shall allow MINERA SOLITARIO to inspect the Properties at its own risk and account, and abiding by reasonable safety standards, to the extent deemed reasonable, on the understanding that the Party conducting such inspection does not interfere excessively with VOTORANTIM's activities.

6.7.3     Make timely and full payment of the Validity Fees for the Properties or other fees or taxes that the federal or local governments shall impose in relation to mineral, surface, water or other rights required to execute work programs.  In this sense, VOTORANTIM will be obliged to pay the Validity Fees of the Properties for each year during which the Mining Assignment Agreement is in force, provided that said fees shall be paid every year, with no delay. 

Should the Properties, or any of them, be returned to BONGARA as a consequence of the termination of this Agreement or the decision of VOTORANTIM to abandon the same under clause nineteen, on the effective date of termination or abandonment, no payment of the Validity Fees in respect of the Properties shall be outstanding and the Validity Fees for all years prior to the effective date of return or abandonment must be fully paid.

Within fifteen (15) calendar days as from the date in which the relevant payments are made, VOTORANTIM shall forward a copy of the corresponding supporting documents to MINERA SOLITARIO, provided, however, that said documents should be delivered to MINERA SOLITARIO not less than fifteen (15) calendar days in advance to the date on which under the laws in force at that time, payment of the Validity Fees shall be timely made.

VOTORANTIM shall also make timely payments to local landowners or communities as required by local ordinance or contract as may be needed for the use of surface rights or ingress and egress. It is expressly established that should VOTORANTIM elect to terminate this Agreement, that no payment of the Validity Fees for the Properties or payments to local landowners or communities shall be outstanding, so that on the effective date of termination or abandonment, the Validity Fees corresponding to all the years that may have began until the above mentioned effective date of termination must be fully paid.

10

<PAGE>
If it is not possible to make the payments directly to the administrative entity that should receive them, they will be understood to be made at the time VOTORANTIM delivers an amount equivalent to the same to BONGARA with reasonable anticipation so that BONGARA can make such payments in a timely manner.

6.7.4     VOTORANTIM shall be responsible for filing the Annual Consolidated Statement (DAC) corresponding to the Properties.  Once the relevant filing has been made, VOTORANTIM shall forward a copy of the filed documents to MINERA SOLITARIO, provided, however, that said documents should be delivered to MINERA SOLITARIO not less than fifteen (15) calendar days in advance to the date on which under the laws in force at that time, the filing of the DAC shall be made.

6.7.5     VOTORANTIM hereby undertakes responsibility regarding the environmental obligations that may arise from the mining activities conducted by it in the Properties, and to carry out exploration works in a correct, diligent and efficient manner in accordance with sound mining industry and environmental protection standards and practices, and abiding by the terms and conditions of the concessions, assignments, licenses, permits, contracts and other agreements pertaining to the Properties.

With respect to the above, it is hereby agreed that VOTORANTIM shall not be responsible for any environmental liabilities that are a result of the works performed in the Properties prior to the Initial Date.  

6.7.6     VOTORANTIM shall be liable to MINERA SOLITARIO for any action or inaction directly attributable to VOTORANTIM resulting in damages, losses, expenses, penalties or fines. No default by VOTORANTIM of its obligations shall be deemed to have occurred hereunder, if compliance therewith is rendered impossible due to MINERA SOLITARIO's failure to perform acts required by this Agreement.

Any environmental obligations or liabilities of VOTORANTIM hereunder and those arising out of the application of the legal statutes and regulations applicable to the activities that it shall conduct in the Properties, shall endure as a Continuing Obligation after termination of the Mining Assignment Agreement.

6.8     During the term of the Mining Assignment Agreement, MINERA SOLITARIO will make its best efforts to collaborate with VOTORANTIM in taking all reasonable action to resolve any problems that could exist or arise with the owners of the surface lands required for conducting mining activities with regard to the Properties, and with small, artisan or illegal miners that could be working in the area of the Properties. 

With respect to the above, MINERA SOLITARIO will make its best efforts to assist VOTORANTIM in its dealings and negotiations with any owners or occupiers of the above mentioned surface lands, indigenous cultural communities or any other person or entity that could be affected by VOTORANTIM's activities in the Properties.

6.9     During the term of the Mining Assignment Agreement VOTORANTIM and MINERA SOLITARIO shall convene quarterly meetings to review the results of the previous quarter's exploration and development results, expenditures and plans for future activities on the Property.  Such meetings shall be held in Lima, Peru at a time convenient for the participants and may be held by telephone.  

Seven:          FIRST and SECOND OBLIGATIONS TO CAPITALIZE
7.1     Within ten (10) calendar days following the date of receipt of the notice referred to in section 7.2 and as long as: 

11

<PAGE>
(i)     VOTORANTIM had timely and duly delivered said notice to MINERA SOLITARIO; 

(ii)     VOTORANTIM had timely and duly fulfilled the requirements set forth in sections 7.3, 7.4 and 7.5; and,

(iii)     VOTORANTIM is not in default of its obligations under the Mining Assignment Agreement and, in general, under this Agreement; 

MINERA SOLITARIO shall procure that BONGARA, by means of a Shareholders' Meeting resolution, capitalizes a contribution to be made by VOTORANTIM referred to in section 6.1 (the "FIRST OBLIGATION TO CAPITALIZE") of the expenditures made in the completion of the Feasibility Study mentioned in section 7.3.3, this latter document, the technical reports and other assets or outstanding debts before BONGARA obtained and/or registered by the latter as a result of its exploration activities in the Properties during the term beginning at the Initial Date and ending at the date in which the notice referred to in section 7.2 is received by MINERA SOLITARIO.  

Such capitalization will be agreed by BONGARA's Shareholders' Meeting either as a result of VOTORANTIM directly contributing those assets to BONGARÁ's capital stock, as result of the capitalization of the credits owed to VOTORANTIM by BONGARA following the latter's purchase of the same assets from VOTORANTIM, or in any other way deemed convenient.  Accordingly, the Parties agree that the mechanism through which the aforesaid assets will be transferred for the benefit of BONGARA and will subsequently allow VOTORANTIM to earn-in the shareholding interest in BONGARA referred to in this section, will be determined by considering the most tax efficient method taking into account the interests of all of the Parties.

As a result of the contribution and the recording in the books of BONGARA as Initial Capital the expenditures of VOTORANTIM during the period beginning at the Initial Date and ending at the date in which the notice referred to in section 7.2 is received by MINERA SOLITARIO (this is, after fulfillment of the provisions of sections 7.3, 7.4 and 7.5 has been met), VOTORANTIM will receive shares issued by BONGARA equivalent to the following:
(a)     If VOTORANTIM had requested performance of the FIRST OBLIGATION TO CAPITALIZE to MINERA SOLITARIO after having fulfilled only one of the conditions set forth in sections 7.3.3.1 and 7.3.3.2, VOTORANTIM will receive shares issued by BONGARA equivalent to 61% of the latter's capital stock.  

(b)     If VOTORANTIM had requested performance of the FIRST OBLIGATION TO CAPITALIZE to MINERA SOLITARIO after having fulfilled both conditions set forth in sections 7.3.3.1 and 7.3.3.2, VOTORANTIM will receive shares issued by BONGARA equivalent to 70% of the latter's capital stock.  

In this case, the SECOND OBLIGATION TO CAPITALIZE will extinguish as soon as VOTORANTIM formalizes its title over shares equivalent to 70% BONGARA's capital, as it will be deemed that VOTORANTIM had already complied with the conditions set forth in section 7.6 for those effects. 

In the event that the contribution made by VOTORANTIM is valued and/or represents more than a 61% or 70% interest in BONGARÁ (as the case may be), VOTORANTIM will only receive shares representing a 61% or 70% interest in BONGARÁ. The excess or difference between the value of the referred investment made by VOTORANTIM and the shares' value subscribed and received by VOTORANTIM in exchange, shall be deemed to be a capital premium for the benefit of both Shareholders.  

12

<PAGE>
Upon this initial capitalization VOTORANTIM and MINERA SOLITARIO shall then be deemed to have made initial contributions to the capital of BONGARÁ equal to their pro rata shareholding interests in the proportion VOTORANTIM 61% and MINERA SOLITARIO 39%, or VOTORANTIM 70% and MINERA SOLITARIO 30%, as the case may be and such contributions to the capital shall be recorded in the books of BONGARÁ accordingly.  

7.2     Within a thirty (30) calendar days term counted as from the date in which the conditions established in sections 7.3, 7.4 and 7.5 are complied with, VOTORANTIM may request MINERA SOLITARIO, through the delivery of a notarized letter, to perform the FIRST OBLIGATION TO CAPITALIZE.  

If the aforesaid notarized letter is not delivered and received by MINERA SOLITARIO within the above mentioned term, then it will be deemed as if VOTORANTIM had waived its right to request performance by MINERA SOLITARIO of the FIRST OBLIGATION TO CAPITALIZE, in which case this Agreement will be terminated and the appropriate provisions of section 22.1 shall apply. In this case, the appropriate provisions set forth in clause twenty two will be applicable.

7.3     It is a condition for the enforceability of the FIRST OBLIGATION TO CAPITALIZE that VOTORANTIM complies with the following:
7.3.1     Invests a total amount of Qualified Expenditures of US$ 1,000,000.00 (one million and 00/100 American Dollars) in exploration activities in the Properties during the twelve (12) month period following the Initial Date.

It is hereby agreed that any excess of the Qualified Expenditures for the period referred to in this section 7.3.1, will be applied to those indicated in section 7.5.

7.3.2     Notifying MINERA SOLITARIO in writing that it has decided to continue making Qualified Expenditures, although now as per the schedule described in section 7.5, in which case the provisions established in such section will apply. 

7.3.3     Notifying MINERA SOLITARIO in writing that it has either:
7.3.3.1     Completed and delivered to MINERA SOLITARIO a Feasibility Study supporting the construction of a mining project over the Properties, in a form that is customary for VOTORANTIM and appropriate for this company to obtain approval for the construction of a mining project of similar characteristics of those encountered in the Properties, and that as a result of such Feasibility Study, VOTORANTIM will cause BONGARÁ to proceed with the development of a mine in the Properties, except as provided in clause eight; or,

7.3.3.2     Completed and overall and cumulative investment of Qualified Expenditures of US$ 18'000,000.00 in the Properties.
The notice referred to in this section 7.3.3, may be delivered by VOTORANTIM upon verifying that any or both of the conditions stipulated in sections 7.3.3.1 or 7.3.3.2 have been met, whichever is verified first.

The Parties hereby declare and agree that, except for the completion of the investments indicated in section 7.3.1, there is no given term agreed for VOTORATIM to deliver to MINERA SOLITARIO the notices mentioned in sections 7.3.2 and 7.3.3 above.  Therefore, VOTORANTIM may take as much time as it considers convenient in order to adopt the decisions and complete the works, subject to expenditure schedule in section 7.5, that it might deem convenient, in order to deliver the above mentioned notices.  

13

<PAGE>
7.4     In compensation for obliging to perform the FIRST and SECOND OBLIGATIONS TO CAPITALIZE, VOTORANTIM hereby agrees to pay  BONGARA (or the person or entity designated by the latter at due time for receiving the payment) the following amounts, the same that include the corresponding General Sales Tax (IGV) and any other tax that could eventually result applicable:

(i)     US$ 100,000.00 (one hundred thousand and 00/100 American Dollars) to be paid on the first annual anniversary of the Initial Date (i.e. 4th of August, 2007).

(ii)     US$ 200,000.00 (two hundred thousand and 00/100 American Dollars) to be paid, as from the second annual anniversary of the Initial Date and on each subsequent annual anniversary of the Initial Date, until the date in which this Agreement is terminated or VOTORANTIM has delivered to MINERA SOLITARIO the notices referred to in sections 7.3.2 and 7.3.3.  Therefore, as from the date in which this Agreement is so terminated or the aforesaid notices are delivered, VOTORANTIM will no longer be obliged to complete or make any payments (accrued or not), provided that any obligation with respect thereof will no longer be enforceable and shall be extinguished.

Making the payments of the amounts indicated in this section is also a condition for the enforceability of the FIRST and SECOND OBLIGATIONS TO CAPITALIZE.

7.5     As from the beginning of the second year following the Initial Date, VOTORANTIM will continue making Qualified Expenditures in the Properties in accordance to the following schedule:
7.5.1     Investments of not less than US$ 1'500,000.00 (one million and five hundred thousand and 00/100 American Dollars) in exploration and/or development activities to be performed directly in the Properties, during the second twelve (12) months following the Initial Date.  

7.5.2     Investing not less than US$ 1'500,000.00 (one million and five hundred thousand and 00/100 American Dollars) in exploration and/or development activities to be performed directly in the Properties, during the third twelve (12) months following the Initial Date.

7.5.3     Investing not less than US$ 2'500,000.00 (two million and five hundred thousand and 00/100 American Dollars) in exploration and/or development activities to be performed directly in the Properties, during each of the following years.

VOTORANTIM will only be obliged to make the minimum investments referred to in this section, until the date in which this Agreement is terminated under the provisions of section 22.1 or VOTORANTIM has earned a 70% shareholding interest in BONGARA.

Any excess investment made by VOTORANTIM during any of the periods mentioned in sections 7.5.1, 7.5.2 and 7.5.3, shall be offset against the investment obligation established for the following period.  On the contrary, if VOTORANTIM does not complete the committed investment for a given period, then VOTORANTIM shall, at its discretion, fulfill one of the two following options in order to maintain its rights under this Agreement:
     pay directly to MINERA SOLITARIO (as a penalty) an amount equivalent to those outstanding investments, or

     on a date not later than 15 calendar days prior to the end of a period deliver to MINERA SOLITARIO written notice of a firm commitment to fulfill during the next work commitment period both the uncompleted investment 

14

<PAGE>
from the then current period and the investment to be completed during the following work commitment period.  An uncompleted investment postponed until the following period shall not exceed 20% of the work commitment for the period.   

It is hereby expressly declared that the completion by VOTORANTIM of cumulative investments in Qualified Expenditures for US$ 18'000,000.00, is not a condition for the enforceability of the FIRST OBLIGATION TO CAPITALIZE nor for VOTORANTIM to request MINERA SOLITARIO its fulfillment. Therefore, it is hereby agreed that the prior completion of an overall and cumulative investment in Qualified Expenditures for US$ 18'000,000.00 will not be a condition for VOTORANTIM to earn-in a 61% interest in BONGARA.  

However, if VOTORANTIM has not made cumulative investments in Qualified Expenditures of US$ 18'000,000.00 upon the date of the FIRST OBLIGATION TO CAPITALIZE, then continued expenditures as defined in section 7.7 by BONGARA shall be funded 100% by VOTORANTIM until a total of US$ 18'000,000.00 has been funded by VOTORANTIM.  Only after VOTORANTIM has fulfilled a cumulative expenditure of US$ 18'000,000 and VOTORANTIM has delivered the notice required in section 7.3.2 and fulfilled the requirements of 7.3.3.1 and 7.3.3.2, shall MINERA SOLITARIO be required to participate in joint funding as provided for in section 9.2.

7.6     If pursuant to section 7.1, VOTORANTIM had only earned-in a 61% shareholding interest in BONGARA as a result of the former having fulfilled only one of the conditions set forth in sections 7.3.3.1 and 7.3.3.2, MINERA SOLITARIO will be irrevocably obliged to vote at BONGARA's Shareholders' Meeting in favor of capitalizing the contributions to be made by VOTORANTIM of all the assets or outstanding debts before BONGARA obtained and/or registered by the latter as a result of its exploration activities in the Properties conducted as from the date of receipt by MINERA SOLITARIO of the notice referred to in section 7.2, and the date in which VOTORANTIM delivers to MINERA SOLITARIO a notice informing that it has fulfilled whichever one of the conditions set forth in sections 7.3.3.1 or 7.3.3.2 was pending of completion after performance by MINERA SOLITARIO of the FIRST OBLIGATION TO CAPITALIZE (the "SECOND OBLIGATION TO CAPITALIZE").

Such capitalization will be agreed by BONGARA's Shareholders' Meeting either as a result of VOTORANTIM directly contributing those assets (which may include the expenditures incurred in the preparation of the Feasibility Study referred to in section 7.3.3.1 and this document, should that be the case) to BONGARA's capital stock, as a result of the capitalization of the credits owed to VOTORANTIM by BONGARA following the latter's purchase of the same assets from VOTORANTIM, or in any other way deemed convenient.  Accordingly, the Parties agree that the mechanism through which the aforesaid assets will be transferred for the benefit of BONGARA and will subsequently allow VOTORANTIM to earn-in the additional shareholding interest in BONGARA referred to in this section, will be determined by considering the most tax efficient method taking into account the interests of all of the Parties and BONGARA.

As a result of the performance by MINERA SOLITARIO of the SECOND OBLIGATION TO CAPITALIZE, VOTORANTIM will receive shares issued by BONGARA equivalent to 9% of the latter's capital stock. In the event that the contribution made by VOTORANTIM is valued and/or represents more than a 9% interest in BONGARA, VOTORANTIM will only receive shares representing a 9% interest in BONGARA. The excess or difference between the value of the assets or credits subject of capitalization and the shares' value subscribed and received by VOTORANTIM in exchange, shall be deemed to be a capital premium for the benefit of both Shareholders.  

15

<PAGE>
Upon this capitalization VOTORANTIM and MINERA SOLITARIO shall then be deemed to have made contributions to the capital of BONGARÁ equal to their pro rata shareholding interests in the proportion VOTORANTIM 70% and MINERA SOLITARIO 30%.  

MINERA SOLITARIO shall perform the SECOND OBLIGATION TO CAPITALIZE within ten (10) calendar days following the date of receipt of the notice delivered by VOTORANTIM informing MINERA SOLITARIO that it has fulfilled whichever one of the conditions set forth in sections 7.3.3.1 or 7.3.3.2 was pending of completion after performance by MINERA SOLITARIO of the FIRST OBLIGATION TO CAPITALIZE.

7.7     Qualified Expenditures
7.7.1     "Qualified Expenditures" are understood to be all costs, expenditures and liabilities of any kind incurred in exploration activities on the Properties or in benefit of the Properties during the term of the Mining Assignment Agreement and will include:

(i)     Actual salaries, benefit and fringe costs and wages (whether or not required by law) of employees or contractors of VOTORANTIM directly assigned to and actually performing exploration and related activities within or benefiting the Properties.  Employees and contractors may include geologists, geophysicists, engineers, surveyors, engineering assistants, technicians, draftsmen, engineering clerks, field assistants, local contracted labor and any other personnel performing services connected with exploration of the Properties;

(ii)     Monies expended associated with aerial flights;

(iii)     Monies expended associated with drilling, site preparation and road construction;

(iv)     Monies expended for use of machinery, vehicles, equipment and supplies required for exploration; provided, however, if VOTORANTIM uses equipment owned by it, charges shall be no greater than on terms available for third parties in the vicinity of the Properties;

(v)     Monies expended for reasonable travel expenses and transportation of employees and contractors, material, equipment and supplies necessary for the conduction of exploration activities;

(vi)     Any  other payments to contractors for work on or for the benefit of the Properties;

(vii)     Monies expended for metallurgical and engineering work; geophysical, geochemical and geological surveys and assays and other costs incurred to determine the quality and quantity of minerals within the Properties;

(viii)     Monies expended to obtain permits, rights-of-ways and other similar rights as may be required or necessary in connection with exploration on the Properties;

(ix)     Monies expended in preparation and acquisition of environmental permits necessary to commence, carry out or complete exploration, and otherwise spent on or accrued for activities required for compliance with environment protection laws and regulation;

(x)     Monies expended in performing pre feasibility or Feasibility Studies to evaluate the economic feasibility of mining on the Property, including expenditures for metallurgical test work, preliminary design work and hydrology studies;

(xi)     Monies expended for taxes levied against the Properties and paid by VOTORANTIM and the cost of any insurance premiums, performance bonds or other forms of sureties required by the law;

16

<PAGE>
(xii)     Monies expended for and including land holding costs, lease payments, assessment work, claim location, amendment and relocation costs, government fees, Validity Fees, penalties and other necessary expenditures incurred or made to preserve in good standing status and title of the Properties;

(xiii)     Monies expended in performing socio-economic studies, payments to local communities, and other social work related to local communities; 

(xiv)     an amount equal to five percent (5%) of the Qualified Expenditures of each period, for concept of administrative expenses.  As from the date in which VOTORANTIM has completed US$ 10,000,000.00 (ten million American Dollars) of Qualified Expenditures, this amount will be reduced to three percent (3%). It is hereby agreed that the payments made in accordance to section 7.4 and the expenses incurred by VOTORANTIM for acquiring the title or right for using surface lands and their corresponding taxes, shall not be allowable expenditures for the purpose of calculating the overhead fee to which this paragraph makes reference to; and,

(xv)     Monies paid in accordance to section 7.4

It is hereby established that the Value Added Tax (Impuesto General a las Ventas), the Tax of Municipal Promotion (Impuesto de Promoción Municipal) and any other tax levying sales or added value corresponding to the items referred to in above, will be considered as part of the Qualified Expenditures. 

7.7.2     Within fifteen (15) calendar days following:

(i)     the date on which VOTORANTIM determines that it has spent an overall and cumulative investment of US$1'000,000.00 in Qualified Expenditures; and

(ii)     the end of each twelve (12) months period as of the date mentioned in 7.5.1, 7.5.2 and 7.5.3 above;

(iii)     the date on which VOTORANTIM provides to MINERA SOLITARIO notice as provided for in section 7.3.3 and, if having already provided such notice, determines that it has spent an overall and cumulative investment of US$18'000,000.00 in Qualified Expenditures; 

VOTORANTIM shall submit to MINERA SOLITARIO a report describing in reasonable detail the nature and amount of all expenses incurred by VOTORANTIM and deemed by it to qualify as Qualified Expenditures, and a report on the results of the activities conducted in the previous twelve (12) months, detailing the technical relevant issues pertaining to each activity and the interpretive results, conclusions and recommendations obtained as a consequence of those activities. 

7.7.3     Within thirty (30) calendar days after receipt of the Qualified Expenditures reports referred to in section 7.7.2(i), 7.7.2(ii) and 7.7.2(iii) hereof, MINERA SOLITARIO shall give written notice to VOTORANTIM if it considers that any of the expenses made by VOTORANTIM do not qualify as Qualified Expenditures, and it shall support its observations in detail.  If such term expires and MINERA SOLITARIO has not submitted any observations to the Qualified Expenditures, the Qualified Expenditures submitted by VOTORANTIM for such period shall be deemed approved.  However, should MINERA SOLITARIO request in writing that the period for review of a Qualified Expenditures report such request shall be granted for a second period of thirty (30) calendar days.

17

<PAGE>
It is hereby understood that the Qualified Expenditures corresponding to such periods which have already been subject to review and approval, shall not be subject to further observations.

7.7.4     Upon receipt of MINERA SOLITARIO's observations, VOTORANTIM shall have a fifteen (15) calendar day period to

(a)     Issue a reply in writing thereto giving an explanation of the differences and detailing what observations made by MINERA SOLITARIO are accepted, if any.

(b)     If there remain observations by MINERA SOLTIARIO that are not accepted by VOTORANTIM the latter will propose a time and a place acceptable to both Parties to meet to discuss and resolve any unaccepted observations;

(c)Pay BONGARA a cash amount equal to such amount as is required to complete the relevant Qualified Expenditures for the term stipulated in section 7.3.1, in which case they shall be understood to have been completed. This alternative is only applicable when verifying the Qualified Expenditures described in the report mentioned in section 7.7.2(i) for determining whether VOTORANTIM has completed the minimum investments indicated in section 7.3.1.

It is hereby understood that the above mentioned alternatives are not excluding, and that two or three of them may be concurrently applied to different items.

If within the aforesaid fifteen (15) day term VOTORANTIM does not notify MINERA SOLITARIO in writing as described in paragraphs (a) or (b), it shall be deemed that VOTORANTIM has accepted the observations filed by MINERA SOLITARIO. Therefore, the Qualified Expenditures disputed by MINERA SOLITARIO will not be considered as such for the purposes of determining the amount of the investments effectively made by VOTORANTIM within the term to which those investments correspond.

If, in the case that the differences in the acceptance of Qualified Expenditures cannot be resolved, any Party may call for the submission of the difference to the decision of a consultant firm to be appointed by the mutual consent of the Parties. This decision will be final and binding for the Parties, provided that the fees of the consultant firm will be paid by the Party which position was upheld in a lesser proportion of the Qualified Expenditures under dispute.

7.7.5     If upon verification of the investments described in the reports mentioned in sections 7.7.2 (i), 7.7.2(ii) and 7.7.2(iii), arbitration determines that VOTORANTIM has not completed the Qualified Expenditures which completion is claimed by VOTORANTIM, this company will be entitled to deliver to MINERA SOLITARIO, within a maximum period of thirty (30) calendar days following the date in which the decision is notified, an amount equal to such difference; in which case the Qualified Expenditures which investment was claimed by VOTORANTIM, shall be understood to have been completed. If VOTORANTIM does not make the corresponding payment within the aforesaid thirty (30) days term, it shall be deemed that VOTORANTIM did not complete the Qualified Expenditures that it had included in the reports subject matter of revision by the consultant firm referred to in section 7.7.4 above.

7.8     It shall be understood that VOTORANTIM has complied with the conditions set out in sections 7.3, 7.4 and 7.5, upon the alternative occurrence of any of the following:

18

<PAGE>
(i)     MINERA SOLITARIO accepts in writing that VOTORANTIM has satisfied them;

(ii)     When through the decision of the consultant firm mentioned in section 7.7.4, it is determined that VOTORANTIM has completed the Qualified Expenditures referred to in section 7.3.; or,

(iii)     If applicable, when VOTORANTIM has paid to MINERA SOLITARIO any deficiency sums for the Qualified Expenditures mentioned in section 7.3 (as defined in section 7.6.5) and 7.5.

Eight:          Events Affecting the Conditions upon which the Feasibility Study was Prepared

Parties expressly agree that if after the delivery of the notice referred to in section 7.3.3, events which are out of VOTORANTIM's control or that qualify as force majeure events in accordance to this Agreement, materially change or affect the conditions or elements foreseen in the Feasibility Study indicated in the same section, VOTORANTIM will not incur any liability or default if deciding not to cause (or to delay) BONGARA to proceed or to continue with the development, construction or initiation of Commercial Production of a mine in the Properties, until the time in which the conditions that were materially changed or affected, are reinstated to their original status, provided that BONGARA diligently reviews the Feasibility Study to determine if the conditions that were materially changed can be mitigated by changing the parameters of the Feasibility Study and, if so, shall modify the Feasibility Study to enable the initiation of construction of the mine.  

Nine:          Operations of BONGARA 
9.1     Considering that it is the Parties' intention that BONGARA refrain from any activity that could result in any kind of liability for this company or that could affect in any way its legal, economic, and/or financial situation during the term of the Mining Assignment Agreement, MINERA SOLITARIO expressly commits to cause BONGARA to completely suspend its operations and activities during the term of the Mining Assignment Agreement and any extensions of the latter.  

Accordingly and during the above mentioned term, MINERA SOLITARIO will only cause BONGARA to comply with the legal obligations to which the latter might be subject to (such as the timely filing of tax returns) and to the compliance of the stipulations contained herein which might result applicable to BONGARA.  In addition and during the same term, MINERA SOLITARIO will refrain from, in any way, encumbering or contracting over BONGARA's shares or somehow affecting them.  

In this sense, Parties hereby expressly agree that only as from the date in which the Mining Assignment Agreement is terminated, BONGARA will assume control and responsibility over the Properties and the activities undertaken in them. Before that date, VOTORANTIM will continue being in charge and responsible for the activities to be carried in the Properties and the decisions pertaining the same.

9.2     As from the date in which VOTORANTIM has earned-in a 70% interest in BONGARA as a result of MINERA SOLITARIO performing the FIRST and SECOND OBLIGATIONS TO CAPITALIZE, any and all investments and expenses required by BONGARA for:

     conducting further exploration activities; 

     the preparation of any additional Feasibility Studies or similar studies; 

     funding the construction or development of a mine in the Properties; 

     beginning Commercial Production; 

     continuing operations and; in general, for 

     developing BONGARA's activities;

19

<PAGE>
shall be borne in a pro rata basis by the Shareholders in accordance with their shareholding interest in BONGARÁ.  For these effects, the stipulations contained in clause twelve with regard to the approval and execution of Programs and Budgets will apply.

9.3     Upon the termination of the Mining Assignment Agreement referred to in clause six and as long as VOTORANTIM keeps, at least, a 50% shareholding interest in BONGARA, it shall be the Operator of the Properties.  The Operator shall supervise and direct all relevant mining activities developed therein.  For such purpose, the Operator shall nominate and appoint the General Manager of BONGARA.  The other Party shall vote in accordance to this clause.  However, if VOTORANTIM reduces its shareholding interest in BONGARA to less than 50%, the Party that holds a majority interest may, at its option, immediately becomes the Operator.

9.4     The decisions and resolutions of BONGARA's Shareholders' Meeting or Directors' Meetings shall be adopted in accordance to the quorum and majority provisions established in the Peruvian General Corporate Act except as provided for in section 13.1.  

Notwithstanding the foregoing,  the approval of the amendment of BONGARA's bylaws related to capital increases for the purposes of financing referred in section 9.4.1, and of the encumbrances mentioned in section 9.4.11, will require a quorum of 66% in first call or 60% in second call, and the favorable vote of the absolute majority of the shares issued by BONGARA, at a Shareholders' Meeting; while the issues enumerated in sections 9.4.2, 9.4.3, and 9.4.5 will require a quorum and favorable vote of at least 90% of the shares issued by BONGARA, at a Shareholders Meeting; while the approval of the issues enumerated in sections 9.4.1, 9.4.4, 9.4.6, 9.4.7, 9.4.8, 9.4.9 and 9.4.10 will require a quorum and favorable vote of at least 81% of the shares issued by BONGARA, at a Shareholders Meeting.
9.4.1     Amendments to the bylaws of BONGARA, excluding any amendment related to any increase of BONGARA's capital stock to be implemented for the financing of any of the phases of the mining activities to be carried out in the Properties during their mine life, in which case the approval of such amendment of BONGARA's bylaws shall be subject to and regulated by the provisions of the Peruvian General Companies Act, without being subject to any supermajority or similar provision whatsoever;

9.4.2     Changes in the means of calculation of the shareholding interest of the Parties in BONGARA (dilution provisions); 

9.4.3     The amendment or alteration in the rights or conditions attaching to the shares issued by BONGARA; 

9.4.4     The approval of BONGARA's policy for the allocation of dividends distribution;

9.4.5     An amendment to the method for appointing BONGARA's Directors, which is hereby agreed to be equivalent to the provisions established for those effects in the Peruvian General Corporate Act, that foresees the representation of minority Shareholders in the Board of Directors, should those Shareholders hold enough shares to be represented subject to the provisions of section 13.1; 

9.4.6     The dissolution, fusion, reorganization and liquidation of BONGARA;

9.4.7     Except as permitted in this Agreement (e.g. the allocation of minerals in accordance to clause eighteen), the entering by BONGARA into any transaction or arrangement with any of its Shareholders or with Affiliates or Subsidiaries of the latter; or,

20

<PAGE>
9.4.8     Engaging in businesses that are not part of the ordinary course of business of BONGARA. 

9.4.9     Except as otherwise provided in this Agreement the transfer, cession or encumbrance of the Property.

9.4.10    To make warranties to third parties.

9.4.11    To encumber the Property or property of BONGARA, except as required for obtaining financing or raising capital in connection with BONGARA's activities.

Ten:          Right of first offer 
10.1   In the event that a Party wishes to transfer or assign in any way its shares in BONGARA (the "Selling Party"), the Selling Party shall communicate the terms and conditions under which it will be willing to formalize such transfer or assignment to the other Party (the "Non-Selling Party") and grant them a "right of first offer" for a period of forty five (45) days to decide whether they accept to enter into the transfer or assignment under the terms proposed by the Selling Party.  

If the Non-Selling Party decides not to enter into the proposed transfer or assignment, the Selling Party shall have a ninety (90) days term to formalize such transfer or assignment in favor of third parties on no less favorable terms than those offered to the Non-Selling Party. If the transfer or assignment is not formalized within such term, the Selling Party will be required to comply again with the procedure set forth in this section.

        The "right of first offer" stipulated in this section shall not be applicable to any transfer or assignment made to an Affiliate or Subsidiary of the Parties. 

10.2   The creation of usufructs, pledges (garantías mobiliarias) or any other type of lien or encumbrance over the shares issued by BONGARA, or over any right pertaining to those shares, or the issuance of an irrevocable mandate in favor of another party for it to exercise any of the rights described in this paragraph, will be governed by the provisions contained in this clause ten related to the transfer of shares. 

Without prejudice of the above, the Parties are only authorized to encumber its shares in BONGARA for purposes of obtaining the financing for the development and construction or the operating costs of a mine by BONGARA, as provided herein. 

10.3   The restrictions to the transfer of shares stipulated in this clause, will not apply to transfer of shares made by the Parties to Affiliates or Subsidiaries.  However, before any such transfer is formalized, the Party that intends to perform the same shall obtain from the Affiliate or Subsidiary to which the shares will be transferred, a commitment to unconditionally adhere in writing to the rights and obligations stipulated in this Agreement, thus undertaking the contractual position of the Party that transferred its shares in BONGARA, in the same terms as the latter did, without any limitation.  

Since it is the Parties' intention to keep BONGARA's shares under their control or the control of their successors, should that be the case, the Parties hereby agree that during the validity of this Agreement the Affiliate or Subsidiary company acquiring the shares will be required to maintain such condition with respect to the Party that transferred the shares in its favor. 

10.4   The Parties hereby declare that the restrictions stipulated in this clause for the transfer of BONGARA's shares, will be included in BONGARA's bylaws.  They also declare that the acquisition of BONGARA's shares by its Shareholders in accordance to the right of first offer, will be exercised in a pro rata basis with the participation of each Shareholder in BONGARA's capital stock and in accordance to the number of shares with respect of which any of such rights are being exercised. 

21

<PAGE>
10.5   The Parties hereby agree that as from the moment in which the transfer of BONGARA's shares is formalized, the transferring Party will be exempted from any new obligation that might accrue and be enforceable in accordance to the stipulations contained in this Agreement and that could have resulted from its condition of Shareholder of BONGARA.

Eleven:          Dilution
11.1   If any of the Parties fail to comply with contributing the pro rata portion of the costs and expenses included in the Programs and Budgets approved by BONGARA's Board of Directors, the shareholding in BONGARA's capital of the Party that fails to comply shall be diluted by the application of the following formula to be used to adjust the new shareholding interests:
PA =CA X 100
CT

Where:
     PA is the new shareholding interest of one of the Parties in BONGARA's capital stock. 

     CA is the total contribution in Initial Capital plus other subsequent contributions which that Party has made or has deemed to have been made in the Properties.

     CT is the total contribution made or deemed to have been made by both Parties in the Properties. 

As soon as practicable after the necessary information is available at the end of each period covered by an adopted Program and Budget, a recalculation of each Party's shareholding interest in BONGARA shall be made in accordance with the preceding formula to adjust, as necessary, the recalculations made at the beginning of such period to reflect actual contributions made by the Parties' during the period.  The adjustment of the Parties' shareholding interest shall be effected as soon as practicable (but at least with the periodicity stipulated in section 12.5) using the most tax efficient method taking into account the interests of all of the Parties and BONGARA, provided, however, that if there is any unnecessary payment or contingency of any kind that result for BONGARA or any Party as a consequence of the dilution and subsequent adjustment of BONGARA's shareholding interest, the diluted Party shall assume those payments and contingencies.  Except as otherwise provided in this Agreement, a diluting Party shall retain all of its rights and obligations under this Agreement, including the right to participate in future Programs and Budgets at its recalculated shareholding interest.

Likewise, the Parties undertake to vote affirmatively in the BONGARA's Shareholders' Meeting to be held in order to capitalize such sums of money as may be required to evidence the shareholding interest resulting from the application of the dilution formula, as well as to carry out any other act necessary to achieve such goal.

11.3   In the event any of the Parties reduces its shareholding participation in BONGARA's capital stock to less than 10%, such participation will be substituted by a two percent (2%) net smelter royalty (NSR) to be determined and paid in accordance to Annex D herein. 

Twelve:          Programs and Budgets
12.1   Once BONGARA has assumed control and responsibility over the Properties as stipulated in section 9.1, the General Manager of BONGARA shall submit for the consideration of BONGARA's Board of Directors the proposal of the Programs and Budgets to be implemented. Except in the case of the Program and Budget for the construction of a mine, subsequent Programs and Budgets should be for maximum terms of twelve (12) months.  The above mentioned proposed Programs and Budgets shall describe in reasonable detail the activities to be developed and contain a Budget of the exploration, construction 

22

<PAGE>
or operating costs that are planned to be incurred therein, as the case may be.  The General Manager will be entitled to include in the Budget an amount equivalent to up to 10% of the overall amount of the Budget for any possible contingencies.   

If within thirty (30) calendar days of presentation of the corresponding construction Program or subsequent Programs to the Board of Directors and due to a deadlock, this corporate body is not able to make a decision on the approval of a given Program and Budget closure plan or any other proposal submitted by the General Manager that is related to the operations of BONGARA, any Shareholder will be entitled to submit an alternate Program and Budget.  If such alternate Program and Budget is not approved within thirty days the dispute or disagreement shall be submitted to the binding and final decision of a consultant firm mutually agreed upon by the Parties.  

12.2   BONGARA's Board of Directors shall review any proposed Program and Budget and, if it deems it convenient, will approve it introducing all the amendments that it might consider convenient as a result of its review. 

12.3   The General Manager shall issue Cash Calls to the Parties according to their shareholding interest in BONGARA in accordance with approved Programs and Budgets.

12.4     The contributions to be made by BONGARA's Shareholders in accordance to this clause, might be effected through capital contributions, loans subject to subsequent capitalization or in any other way determined by the Board of Directors. 

12.5   At least once every year and at the time the Annual Shareholders' Meeting is performed, the Shareholders shall agree to increase BONGARA's capital stock in order to adjust their shareholding interests in BONGARA in accordance to the contributions that they had made to BONGARA in the Program and Budget under this Agreement.  For these effects, the dilution formula established in section 11.1 and any other applicable stipulations contained herein, shall apply. 

12.6   If BONGARA's General Manager suspends or does not complete a Program, the funds that might have been given in advance by the Shareholders for its execution, shall be applied and used for the performance of the next Program and Budget to be approved by the Board of Directors. If the Board of Directors does not approve a Program and Budget within the next calendar year as from the date in which the term of the previous Program and Budget had elapsed, the above mentioned funds will be reimbursed to the Shareholders according to their participation in BONGARA, after covering all the maintenance expenses that BONGARA's Board of Directors might approve. 

12.7   If any Shareholder decides not to contribute with the Program approved by the Board of Directors or after doing so fails in providing the corresponding funds within the term established for those effects, its shareholding interest will be, for any and all effects, immediately deemed to be adjusted by the application of the dilution formula set forth in section 11.1, even if the new shareholding interests of the Parties is not immediately reflected in BONGARA's capital stock through a capital increase. 

12.8   Without prejudice of what has been established in this clause, if during the execution of any Program, at least 80% of the Budget approved by the Board of Directors is not effectively used, the General Manager shall inform the same to all the Shareholders within a term not exceed from ten (10) business days as from the date of completion of the Program.  

Any Shareholder that had decided not to contribute to that Program and that as consequence thereof had been diluted in BONGARA, shall have the option to reimburse to BONGARA within the next twenty (20) business days, its proportional share of the expenses effectively made for covering the Program which approved Budget was spent in less than 80%.  The amount so 

23

<PAGE>
reimbursed to BONGARA, shall be applied by BONGARA for future contributions required from the Shareholders that did contribute to the Program.  On its turn, it would be deemed that the Shareholder that initially did not contribute to the completed Program has recovered the shareholding interest that it had at the time the Program was approved.  

12.9   Notwithstanding other stipulations contained in this Agreement, if in any year with respect of which a Program has not been approved, BONGARA's General Manager is required to incur expenses necessary for maintaining the validity of the Properties, for covering minimum fixed costs, for complying with legal or contractual obligations previously undertaken, or for avoiding environmental or other damages and, in general, for maintaining the facilities of the mine, the General Manager shall propose a Program and Budget to the Board of Directors.  The Board of Directors shall approve a Program and Budget that would provide funding to cover such obligations and expenses. 

Thirteen:          Board of Directors of BONGARA
13.1   Five (5) members shall compose the Board of Directors, except when the parties' share in BONGARA is 50%, in which case four (4) members shall compose the Board. 

As long as MINERA SOLITARIO holds at least a 30% shareholding interest in BONGARA, MINERA SOLITARIO will be entitled to appoint two directors. For these effects, classes of shares will be created in BONGARA in order to entail the shares to be held by MINERA SOLITARIO (i.e. class "B" shares), the appointment of the above mentioned two directors.  However, immediately after MINERA SOLITARIO reduces its shareholding interest to less than 30%, the Parties will attend BONGARA's Shareholders' Meeting to vote in favor of the amendment of BONGARA's bylaws in order to eliminate the existence of classes of shares and, therefore, to formalize the elimination of MINERA SOLITARIO's right to appoint two (2) directors. 

In addition, it is hereby agreed that during the existence of the right of MINERA SOLITARIO to appoint two (2) directors in BONGARA, for any meeting of the Board of Directors to be installed, it shall be required the attendance of at least a number of the directors nominated by VOTORANTIM equivalent to the number of directors nominated by MINERA SOLITARIO, in order for the respective Board's meeting to have quorum.  

As provided in section 9.4, with the quorum restriction described in the preceding paragraph (when applicable) and unless otherwise stipulated in this Agreement, the resolutions of the Board of Directors shall be adopted by simple majority.

13.2   The Board of Directors may remove at its discretion and effective immediately BONGARA's General Manager in the following cases:

13.2.1     Except as provided in section 14.1, if the Party that appointed the General Manager no longer has a majority shareholding interest in BONGARA. 

13.2.2     If the General Manager entered into unauthorized arrangements with BONGARA's creditors, or if the General Manager's insolvency was requested by the General Manager itself or by any of its creditors in accordance to the applicable regulations.

13.2.3     If judicial or extrajudicial measures were adopted that significantly affect the General Manager's assets.

13.2.4     If the General Manager acts with willful misconduct or gross negligence or if it breaches the obligations or duties applicable to him under this Agreement, BONGARA's bylaws or applicable law.

13.2.5     For non performance at the sole determination of the Board of Directors.

24

<PAGE>

13.3    If after the removal or resignation of the General Manager, BONGARÁ's Board of Directors is not able to reach an agreement and pass a resolution appointing a Shareholder or a third party as the new General Manager, the Board of Directors shall evaluate the continuity of BONGARÁ's activities or its potential dissolution and liquidation. 

13.4   The Board of Directors shall be called and will carry out its meetings, in accordance to the stipulations provided for those effects in BONGARA's bylaws and the Peruvian Corporate Act, as applicable. 

13.5   Subject to the notice and quorum requirements set forth in BONGARA's bylaws, the Board of Directors may hold meetings by telephone conferences in lieu of meetings in person.  The Board of Directors may also take actions in writing signed by all members.

13.6   Except as otherwise delegated to the General Manager in clause fourteen or as otherwise provided in this Agreement, the Board of Directors shall have exclusive authority to determine all management matters related to this Agreement.

Fourteen:          General Manager of BONGARA
14.1   With the exception stipulated in the last paragraph of section 14.5, as long as VOTORANTIM keeps at least a 50% shareholding interest in BONGARA, it shall be the operator of the Properties (the "Operator").  The Operator shall supervise and direct all relevant mining activities developed therein.  For such purpose, the Operator shall nominate the General Manager of BONGARA.  In this sense, the other Party shall vote in BONGARA's Shareholders' Meeting and/or Board of Directors in accordance to this clause; this is, to appoint as General Manager the Operator's nominee.  If VOTORANTIM's shareholding interest should decrease to less than 50% then the Party with the largest shareholding interest may, at its option, become the Operator and shall accept its responsibilities accordingly.

14.2   The General Manager can resign at any time by delivering a notice to the Chairman of BONGARA's Board of Directors, with an anticipation of not less than thirty (30) calendar days of the effective date of resignation.  In this case, and voting in accordance to the Operator's nomination, the Board of Directors shall appoint the new General Manager and determine the date in which it will begin performing its duties. 

The General Manager leaving its post (either because it has resigned or because it has been removed by the Board of Directors) shall provide the new General Manager with all the information, statements of account, documents and registers related to its activities in the Properties and BONGARÁ. 

14.3   The General Manager shall be responsible for the management and administration of BONGARA and shall conduct all its activities in a correct, diligent and efficient manner, in accordance with sound standards and practices applicable in the mining industry, social affairs and environmental protection, and substantially abiding by the terms and conditions of the concessions, assignments, licenses, permits, authorizations, contracts and other agreements pertaining to the Properties and/or BONGARA and shall act in the sole interest of BONGARA.  The General Manager will work exclusively for BONGARA and perform no other non-BONGARA activities for the Shareholders or third parties.  Accordingly, BONGARA's General Manager has the following duties:
(i)    Direct any and all works at the Properties, complying with all applicable laws and regulations, without limitation; provided that for their performance any method that is currently available or that might be developed in the future may be used;

25

<PAGE>
(ii)   Subject to the stipulations contained in this Agreement, implement the Programs approved by the Board of Directors, for which effects it will use the contributions to be made by the Shareholders;

(iii)   Exercise all the rights that are or might be inherent or usually connected with the activities conducted in connection to the Properties; 

(iv)   When required, provide the Board of Directors with reports of the progress of the works conducted, indicating the results obtained and disclosing all the technical information gathered in connection with the works performed under this Agreement; along with an analysis of the expenses incurred in the performance of such works; 

(v)   Within twenty (20) calendar days of completion of each Program, provide the Board of Directors with a report describing the works performed during the execution of the Program and the results, conclusions and recommendations obtained as a consequence thereof.  Such report shall contain a statement of the condition of the assets of BONGARA including a reporting of reserves and resources prepared in accordance with internationally recognized standards compliant with National Instrument 43-101 or JORC.

(vi)  Keep the Properties free from liens or encumbrances that could be originated as a result of the activities to be developed in them.

(vii)   Allow the Shareholders unrestrictive access to the Properties and to all the records kept by BONGARA, by its own risk and cost. With respect to the above, the General Manager shall cause BONGARA to maintain proper and complete records and accounts of all the expenditures and works made with regard to the Properties, in accordance with accounting principles and standards generally accepted in the mining industry and based upon an internationally recognized generally accepted accounting principles and applicable law.  Said records and accounts shall be made available for all of BONGARA's Shareholders review and audit at any time they request them, provided that the costs of any such review or audit will be assumed entirely by the Shareholder requesting it. 

Likewise, BONGARA's General Manager shall allow the Shareholders to inspect the Properties at their own risk and account and abiding by reasonable safety standards, to the extent deemed reasonable, on the understanding that the Shareholder conducting such inspection does not interfere excessively with the activities of BONGARA.  

(viii)  Make timely and full payment of the Validity Fees of the Properties, provided that compliance with this obligation shall be made not less than fifteen (15) calendar days in advance to the date on which under the laws in force at that time, the payment of Validity Fees shall be made. 

(ix)   Supervise the work of the persons designated for trading the mineral products extracted from the Properties.

(x)   Provide Shareholders' Directors or a designated representative to be designated by SOLITARIO before VOTORANTIM, access to:  authorised agents, advisors, representatives, counsel, accountants and independent contractors of BONGARA in coordination with the General Manager of BONGARA.

14.4     The General Manager will be entitled to hire independent contractors or professionals to perform the activities required for fulfilling BONGARA's corporate purpose, provided that in all cases the hiring of such contractors and professionals shall be made in accordance to the prevailing market conditions. The General Manager shall not act in representation of any of the Shareholders nor will undertake individual commitments in favor of any one of them, unless permitted by this Agreement or agreed in writing by the Parties. 

26

<PAGE>
14.5     As from the date in which BONGARA assumes control and responsibility over the properties in accordance to section 9.1, BONGARA's General Manager shall prepare and submit to BONGARA's Board of Directors, at least on an annual basis and no later than thirty (30) calendar days before the completion of the previous Program, the corresponding Programs and Budgets and a provisional Cash Call schedule for the following period, provided that the Board of Directors shall review and vote on the proposed Program and Budget within thirty (30) calendar days of presentation of the same to it. The Board of Directors will approve what will be finally executed.   

BONGARA's General Manager will prepare a revised Cash Call schedule based upon the approved Program and Budget and will execute said Programs and Budgets. Unless provided otherwise in this document, upon approval of the annual Programs and Budgets, the Shareholders shall have a thirty (30) calendar day term to inform BONGARA of its decision to contribute or not to the corresponding Program.   The General Manager shall prepare and deliver Cash Calls to the Shareholders according to the Cash Call schedule or as amended to accommodate an amended Program and Budget approved by the Board of Directors.

In case any Shareholder could not, or decides not to, contribute with the pro rata share of the costs and expenses corresponding to said Party according to the Programs and Budgets approved by the Board of Directors, the dilution procedure established in section 11.1 will apply. If the diluting Party had appointed the General Manager, such General Manager will have deemed to have resigned its post and the other Shareholder will be entitled to appoint the new General Manager.

14.6     BONGARA's General Manager shall not be liable to a Shareholder for any action or inaction resulting in damages, losses, expenses, penalties or fines, except if it is due to willful misconduct or gross negligence by the General Manager. No default by the General Manager of its obligations shall be deemed to have occurred hereunder, if compliance therewith is rendered impossible owing to failure by the Shareholder to perform acts required by this Agreement.

According to the above, BONGARA will indemnify and hold harmless the General Manager for any damages that the latter might suffer or liabilities of any nature that could be imputed against him by third parties, as a result of the acts performed or not performed in fulfillment of its duties as General Manager, unless such damages or liabilities have been caused or generated as a consequence of the willful misconduct or gross negligence of the General Manager. 

Fifteen:          Financing 
15.1     Despite that fact that Parties are obliged to contribute on a pro-rata basis in their participation in BONGARA's capital stock as provided in section 9.2, during the forty eight (48) months following the date upon which VOTORANTIM earns a 70% interest in BONGARA, the Parties agree that, if so requested in writing by MINERA SOLITARIO within the ten (10) calendar days following approval by the Board of Directors of an Initial Program and Budget for construction of a mine, MINERA SOLITARIO's share of the costs and expenses, in proportion to 30% of BONGARA's expenditures necessary to develop and/or construct a mine in the Properties and begin commercial production, will be financed by VOTORANTIM by providing a non-recourse loan to MINERA SOLITARIO if the latter accepts the offer to be submitted by VOTORANTIM for providing such loan. 

Upon receipt by MINERA SOLITARIO from VOTORANTIM the terms under which such loan shall be offered, MINERA SOLITARIO shall have a period of thirty (30) days to notify VOTORANTIM if the terms are acceptable and the parties to the loan agreement shall finalize such financing, time being of the 

27

<PAGE>
essence.  If MINERA SOLITARIO does not accept the terms proposed by VOTORANTIM for providing the loan, VOTORANTIM will have no further obligation to provide the financing requested by MINERA SOLITARIO.

For greater clarity, such loan provision shall apply to but not be limited to the capital investments required for construction of the mine, purchase of equipment and construction of facilities necessary for mining and processing, construction of access to the mine and for Programs to optimize or expand such Programs for the purpose of increasing mine or processing activities or to comply with requirements of governmental agencies related to environmental or social Programs related thereto.  It is further understood that the sustaining capital required for ongoing mining activities subsequent to construction of the mine at full capacity and for the normal course of business is specifically excluded from this commitment to finance MINERA SOLITARIO undertaken in this section by VOTORANTIM.

If so required at any time by VOTORANTIM, MINERA SOLITARIO will be obliged to grant any security deemed necessary or convenient by VOTORANTIM over the shares that MINERA SOLITARIO might directly or indirectly hold or control in BONGARA, in order to guarantee any and all the obligations that MINERA SOLITARIO will assume under the loan.

Such loan will accrue on the same schedule and at the same interest rates paid or that would have been paid by VOTORANTIM for the funding of its debt portion of the capital needed for the construction of the mine, provided that such interest rate shall not exceed the prevailing market rates for similar loans. 

A loan provided by VOTORANTIM for financing will be paid back by MINERA SOLITARIO from 50% of the dividends or net proceeds from the sale of product (deducting shipping and other post-production costs) that it is entitled to receive from commercial production of the Properties, until the loan and accrued interests are paid for in full.  MINERA SOLITARIO shall have the right to accelerate pay back of any such loan provided by VOTORANTIM and accrued interests without pre-payment penalty.  In the event such proceeds cease, MINERA SOLITARIO shall not be required to repay such loans until such proceeds again become available.  

If a third party lender so requires as part of the terms of the loan, VOTORANTIM shall provide a completion guarantee to the lender and shall provide such guarantee on behalf of Solitario.

15.2     Only and exclusively for the purpose of guaranteeing the loans that might allow them to make the contributions required for the capital investments in the Properties, BONGARA's Shareholders are entitled to pledge (garantía mobiliaria) or encumber in any other way their shares in BONGARA as long as the beneficiary of such securities is a bank or financial entity that had obliged itself before the other Shareholders to:

(a)     Not foreclose the lien or encumbrance without observing the stipulations contained herein, to which the security so granted will be subject to;

(b)     The judicial or extrajudicial foreclosure of the security by the bank or financial entity will be limited to the sale of the entire group of shares affected with the security to the other Shareholders of BONGARÁ or, if the latter were not interested in making such acquisition, to the sale of the shares through a public auction to be performed after notifying all other BONGARÁ's Shareholders with an anticipation of thirty (30) calendar days, as long as, as condition for the sale, the acquirer obliges in advance, in a manner that is satisfactory to the legal advisor to the Party that had appointed BONGARÁ's General Manager, to:

28

<PAGE>
(i)      undertake all the obligations related to this Agreement that corresponded to the Shareholders which shares are transferred in an auction; and,

(ii)      be bound by the terms and conditions of this Agreement. 

15.3     In the event BONGARA's Board of Directors approved the financing of the construction of a mine under the concept of "project finance" with banks or other financial entities, each shareholder will pledge (garantia mobiliaria) its shares in BONGARA or encumber them in the way required for satisfying the terms and conditions of the financing. The granting of a pledge over BONGARA's shares for formalizing a "project finance", shall have preference over any other kind of security that the shareholders might grant in accordance to section 15.2 above. 

Sixteen:           Construction of a Mine and Operation
16.1   Subject to the provisions contained in clause eight, the General Manager of BONGARA shall implement the construction of the mine in accordance to the Feasibility Study and to the Programs and Budgets approved by the Board of Directors.  During the construction phase, the Board of Directors may introduce and approve any amendments that it deems necessary to complete the Programs and Budgets previously approved. 

16.2   The General Manager of BONGARA shall set the schedule in which the construction of the mine shall be completed and the date as from which the operations of the mine shall be conducted in accordance to the approved Program and Budget of operations. 

16.3   Before the date of completion of the construction of the mine, the General Manager shall propose to the Board of Directors the first annual Program and Budget of operations that shall provide for the operation of the mine until the end of the calendar year during which construction will have been completed.  Subsequently and before November 15 of each subsequent year, the General Manager shall propose the annual Program and Budget of operations for the following calendar year.  Each proposed annual Program and Budget of operations shall contemplate the following:

(a)     The details of the exploration, development and production activities which are expected to be performed during the period;

(b)     A detailed estimate of the exploration, development, production and sales and general administrative (SG&A) costs plus an additional and reasonable amount for  contingencies;

(c)     An estimate of the quantity and quality of the ore that will be mined, and of the ore concentrates to be produced and an accounting of the reserves and resources contained on the Property in accordance with internationally recognized standards compliant with National Instrument 43-101 or JORC

(d)     An estimate of the sustaining capital and new capital investment needed to maintain or improve the production and operational standards.

(e)     Any other aspects that might be reasonably necessary to include in order to explain the results that are expected to be obtained with the execution of the annual plan of operations.

16.4   The Board of Directors shall approve the annual Program and Budget with the amendments that it deems convenient, before December 1 of the year previous to the one with respect of which the plan has been approved. 

16.5   Notwithstanding any other stipulation contained in this Agreement, if in a given year a Program and Budget is not approved and BONGARA is required to incur expenses necessary for maintaining the validity of the Properties, for covering fixed costs or for complying with legal or contractual obligations previously undertaken, or for avoiding environmental or other damages and, in general for maintaining the facilities of the mine, the Board of Directors shall approve a Program and Budget that should sufficiently cover such obligations and expenses until the next Program and Budget is approved or until BONGARA's

29

<PAGE>
 Shareholders' Meeting adopt the decisions necessary for BONGARA to continue fulfilling its corporate purpose. 

Seventeen:          Suspension and Termination of Operations
17.1   At any time BONGARA's General Manager may recommend to the Board of Directors to suspend operations. Such recommendation shall be presented along with the plan proposed for maintaining the infrastructure and facilities of the mine and the assets of BONGARA during the term in which the operations will be suspended.  If the Board of Directors approves the recommendation in accordance with the provisions of section 9.4, the operations will be suspended and the Shareholders obliged to make the contributions necessary for financing the maintenance plan. 

17.2   BONGARA's General Manager may at any time recommend to the Board of Directors the definite termination of operations.  The recommendation shall be presented along with a plan and budget for implementing the closure of the mine, without prejudice of the closure plan that BONGARA had filed in compliance with Law 28090 or any other norm that complements or substitutes the latter, including reasonable detail of the activities to be developed during the closure and reclamation of the area in accordance to applicable regulations.   

17.3   The Board of Directors may approve, introducing all the amendments that it might deem convenient, the definite conclusion of the operations and the closure plan proposed by the General Manager. If the Board of Directors approves the closure plan in accordance with section 9.4, the General Manager shall:

(a)     Implement the mine closure plan. The Shareholders will be obliged to pay the costs required for implementing such plan, in a pro rata basis to their shareholding interests in BONGARA;

(b)     Withdraw, sell or dispose of the assets that might be disposed in a manner most advantageous for BONGARA as well as those other assets for which disposal is required in order to comply with environmental and other applicable regulations;

(c)     Sell, abandon or dispose the Properties, as it may correspond and in accordance with clause 19.

When adopting any decision related to the acts referred to in paragraphs (b) and (c) above, any applicable provisions in the applicable law or BONGARA's bylaws with respect to the matters that should be decided by BONGARA's Shareholders' Meetings bylaws, shall be observed. 

17.4   If the Board of Directors does not approve the closure plan, the General Manager shall continue executing the maintenance plan approved according to the provisions contained in this clause. 

Eighteen:          Allocation of Minerals 
18.1   The sale of any mineral products by BONGARA shall be done under competitive terms on the open market. Notwithstanding the above, the Shareholders will individually have the right to request BONGARA to directly sell to them, under a long term contract, a portion or all the minerals produced by the mine that is equivalent to their shareholding interest in BONGARA.   

For those effects, it is hereby agreed that any long term contract for the sale of minerals by BONGARA, shall conform to the following guidelines:

 
(i)    BONGARA and any potential buyer of concentrates (the "Buyer") shall negotiate in good faith and with the intent to reach agreement, for which effects they will be consistent with the then prevailing international market terms applicable for the delivery of mineral concentrates with similar product characteristics for respective contractual periods, between mines and custom smelters on an arm's length basis.  

30

<PAGE>
International market terms for concentrate (benchmark) shall mean transactions between major mines and custom smelters located in Japan, Korea, Oceania, North America, South America and Western Europe.  After the first calendar year during which initial shipments from the mine are made, all terms for long term contracts shall conform to the calendar year (the "Year") and shall be negotiated for shipments during such Year.   

(ii)   If terms are not agreed upon between BONGARA and the Buyer by the commencement of Commercial Production, then deliveries shall start at a normal rate and shall be provisionally accounted at the economic terms published by CRU (Commodities Research Unit) and Brook Hunt as the then prevailing "benchmark" for zinc for the preceding or current calendar year, as the case may be, subject to final adjustment as soon as the final terms for the contractual Year of reference are known or as otherwise described earlier in this clause.

(iii)   If terms are not agreed upon between BONGARA and the Buyer by the end of the customary annual negotiating period under a long term contract, then deliveries shall continue at a normal rate and shall be provisionally accounted at the economic terms applicable to the preceding Year, subject to final adjustment as soon as the final terms for the contractual Year of reference are known. 

(iv)   Should BONGARA and the Buyer not have reached agreement for annual terms under a long term contract by the time shipments commence, and if BONGARA has agreed to terms with any of BONGARA's other customers, then those terms shall be used provisionally until terms are agreed between BONGARA and the Buyer.

(v)   Should the negotiations to finalize the terms in any given Year be delayed beyond March 31 of any Year, either Shareholder may request a further revision of the provisional terms so that they more accurately reflect the then prevailing benchmark discussions. 

(vi)   Should a benchmark agreement not be reached between the major mines and smelters referred to above, BONGARA and the Buyer shall, nevertheless, make their best efforts to reach an agreement on terms reflecting the best possible information available on market conditions.  

(vii)  Should BONGARA and the Buyer be unable to reach agreement, then the matter may be referred to arbitration as per clause 30.

18.2   Before the minerals are sold or delivered, the General Manager will cause the weighing or calculation of the volume of the minerals, by taking samples and making assays and tests in accordance to standard mining and metallurgical practices. The General Manager shall keep a record of the weights obtained and calculations made, as the case may be, and of the results of the assays and tests performed.  The Shareholders shall individually have the right to take their own samples and make their own calculations relating to weights in order to confirm the grade and quantity of product subject of their interest.  

18.3   The Shareholders are entitled to dispose or in any way enter into transactions with respect to the minerals produced by the mine to which they have allocation rights as agreed to in this clause, as from the date in which such minerals are put at their disposal as a result of the Shareholders having exercised the right granted to them under section 18.1.  Title over the minerals will be acquired by Shareholders as from the date established for those effects in the corresponding purchase or supply agreement executed with BONGARA

31

<PAGE>

Nineteen:          Abandonment of Properties
19.1   If during the term prior to the FIRST OBLIGATION TO CAPITALIZE, VOTORANTIM decides to abandon or release any of the mining rights making up the Properties, it shall notify of its decision to the other Party with an anticipation of thirty (30) calendar days, provided that then such mining right shall be excluded from the scope of this instrument.  Likewise, the Mining Assignment Agreement provided for in the clause six, shall be automatically terminated with respect to the abandoned or released Property. 

The Parties hereby expressly agree that in case of the event provided in the foregoing paragraph, VOTORANTIM shall return to BONGARA or at Solitario's option, to Solitario the possession of said Property and shall provide to such company any and all information and/or documents that may have been prepared and/or obtained as consequence of the activities performed in such Property. 

For the purposes of this section, it shall be understood that VOTORANTIM has abandoned the Property as from the time in which it evidences, at the satisfaction of MINERA SOLITARIO, that the Property is in force, free from any charge or lien, and with all taxes, rights, Validity Fees duly paid, without having deferred or omitted payment of the Validity Fees or applicable penalties even in one year. 

VOTORANTIM shall have the right to remove from the abandoned Property, facilities, equipment, machinery, tools, appliances and any other property of its own or belonging to contractors, within three (3) months as from the time when such Property was abandoned, otherwise, they shall remain in favor of BONGARA, without any cost for the latter.

19.2   If after BONGARA has assumed control and responsibility over the Properties in accordance to section 9.1, BONGARA's General Manager intends to abandon any of the mining rights making up the Property, it must give written notice on its decision to the Party that had not nominated its appointment as General Manager, and such other Party may elect that said Property be transferred to it. 

Under the assumption that the Party that has not nominated BONGARA's General Manager elects not to acquire the Property or does not reply to the General Manager on the decision within thirty (30) calendar days following the receipt of the notice delivered by the General Manager according to the foregoing paragraph, it is expressly provided that BONGARA may abandon said Property, which will be, as from that time, beyond the scope of this Agreement. 

19.3   Should the non-operating Party elect that the Property be transferred to such Party, then, the General Manager must make sure that said Property is in full force and effect and free from any charge or lien, and that all taxes, rights, fees  that may result applicable are paid during the following six (6) months, without having deferred or omitted payment of the Validity Fees or applicable penalties even in one year.   

For the purposes of section 19.2 and this section 19.3, it shall be understood that BONGARA has abandoned the Property as from the time when it evidences, at the satisfaction of the non-operating Party, that the Property is in force, free from any charge or lien and with all taxes and fees duly paid. 

19.4   It is expressly agreed that the definition of Property contained in section 1.8 shall be amended as to not to include the mining rights involved in the Property subject to abandonment or transfer referred to in this clause. 

19.5   The Parties expressly agree that neither of them may establish nor acquire, whether directly or indirectly or otherwise, mining rights or interests in the areas that would have been made subject to abandonment in accordance with this clause, for a twelve (12) month term as from the date in which the abandonment was effective.  The definition of "mining properties", "mining 

32

<PAGE>
rights" or "Property" used in this clause comprise any surface right, water right, license, permit, authorization or any other kind of right or authorization that may have any relationship, whether directly or indirectly, to the Properties or the areas mentioned above. 

19.6   The abandonment of Properties under this clause does not release the Parties from their Continuing Obligations in respect of the abandoned Properties.

Twenty:          Acquisition of mining properties
20.1   The Parties expressly agree that during the validity of this Agreement, neither of them may establish or acquire in any manner whatsoever any mining property or interest within the Area of Interest, unless prior written consent is given by the other Party, in which case the corresponding property will be acquired and/or filed in the name and for the benefit of BONGARA or transferred to BONGARA at cost. This restriction is applicable to any surface right, water right, license, permit, authorization or any other that may have any direct or indirect relationship with the Area of Interest and/or the Properties.  

For purposes of this clause, the definition of "mining properties" comprises any and all surface rights, water rights, licenses, permits, authorizations or any other kind right or authorization granted, obtained or acquired within the Area of Interest, with no limitation. 

20.2   After BONGARA has assumed control and responsibility over the Properties in accordance to section 9.1, BONGARA's Board of Directors may decide on the convenience of acquiring a mining property within the Area of Interest. Upon adopting such decision, BONGARA's General Manager shall make its best efforts to acquire the right, title or interest that may correspond to the said mining claim (the "New Property"), which will be subject to the actions adopted by the Board of Directors. 

Once the General Manager acquires the New Property for BONGARA, the same shall be understood as a Property and shall be subject to the terms and conditions of this Agreement. 

20.3   It is hereby established that the provisions contained in this clause are not applicable to any mining properties that the Parties or any Affiliate or Subsidiary of the latter, might under any title have within the Area of Interest prior to the execution of this Agreement or the Area of Interest as so amended as of the date of the amendment.

Twenty one:          Indemnity
21.1   VOTORANTIM shall indemnify and save harmless MINERA SOLITARIO as to any liability for or on the account of any injury or loss to persons or property which results from any act or omission directly attributable to VOTORANTIM respecting the Properties.  

On its turn, MINERA SOLITARIO shall indemnify and save harmless VOTORANTIM as to any liability for or on the account of any injury or loss to persons or property which results from any act or omission directly attributable to MINERA SOLITARIO respecting the Properties.

21.2   BONGARA shall indemnify and save harmless its officers, General Manager and Directors as to any liability for or on the account of any injury or loss to persons or property which results from any act or omission attributable to BONGARÁ's activities, except for gross negligence or wilful misconduct of such officers, General Manager or Directors.

Twenty two:          Termination

This Agreement shall be terminated in the following cases:
22.1   Pursuant to the provisions established in this section, VOTORANTIM shall at any time prior to earning a shareholding interest in BONGARA have the right to unilaterally and without cause and without any further investment or payment obligations to MINERA SOLITARIO accrued or not (except for the firm obligation to complete the investment indicated in section 7.3.1 or paying any 

33

<PAGE>
balance directly to MINERA SOLITARIO), terminate this Agreement through the delivery of notarized notice to MINERA SOLITARIO, provided that such termination shall be effective thirty (30) calendar days after receipt of said notice by MINERA SOLITARIO.  Such unilateral withdrawal shall, however, not release VOTORANTIM from any Continuing Obligations in relation to the Properties or to this Agreement.

Upon exercising this unilateral termination, VOTORANTIM shall not recover the amounts invested, spent and/or paid until the effective date of termination in connection with this Agreement and/or the compliance with its obligations hereunder, provided that VOTORANTIM shall have paid all the Validity Fees  of the Properties in accordance to section 6.7.3. 

In addition, the following provisions will apply in case of termination of this Agreement:
(i)     Should termination occur prior to the performance of the FIRST OBLIGATION TO CAPITALIZE, VOTORANTIM shall be irrevocably obligated to return to MINERA SOLITARIO or BONGARA at the discretion of MINERA SOLITARIO, the possession of the Properties in force and free from any charge, encumbrance or lien, without limitation. 

VOTORANTIM shall have the right to remove from the abandoned Property, the facilities, equipment, machinery, tools, appliances and any other property of its own or belonging to contractors, within three (3) months as from the time when such Property was abandoned, otherwise, they shall remain in favor of BONGARA, without any cost for the latter.

(ii)     Should termination occur prior to the performance of the FIRST OBLIGATION TO CAPITALIZE, VOTORANTIM will deliver to MINERA SOLITARIO copy of any and all the information, results and/or documents including all interpretive reports containing conclusions and recommendations that VOTORANTIM might have obtained, prepared or gathered in connection with the Properties.

(iii)     If termination occurs at any time after MINERA SOLITARIO performs the FIRST OBLIGATION TO CAPITALIZE, the provisions contained herein related to BONGARA's operation and the relationship between the Parties related to the activities to be carried out by BONGARA in the Properties, and BONGARA's operation, shall remain in force and enforceable except as provided for in section 22.5 .

22.2   In addition to any specific cause of default stipulated in this document, any of the Parties may terminate this Agreement due to the material default of the other Party of complying with any of its obligations hereunder. 

If a Party believes that there is default on the part of the other Party the non-defaulting Party shall require the other Party, through the delivery of a notarized notice, to remedy such default within a maximum thirty (30) days term.  If the Party alleged to have defaulted fails to remedy such default or to respond to the allegation of default within such term then the defaulting Party shall be deemed to have defaulted and this Agreement shall be automatically terminated, without need of any further formality or declaration, provided that the non-defaulting Party will be entitled to demand the defaulting Party payment of the compensation for the damages that its default might have caused.  Notwithstanding the above mentioned thirty (30) calendar day period for curing default, if a Party declares in writing that it has not defaulted or has cured the default and the non-defaulting Party does not agree in writing, then the non-defaulting Party shall have recourse to invoke the provisions of clause thirty, arbitration, within a thirty (30) calendar day term following the notice in which it notified the defaulting Party that it does not agree with it having not defaulted or with curing its default.  If such invocation is not delivered in writing by the non-

34

<PAGE>
defaulting Party within the aforementioned thirty (30) calendar days term, then it shall be deemed that no default occurred or that such default has been cured to the satisfaction of the non-defaulting Party.

Notwithstanding the termination of this Agreement, the Parties shall keep, as the case may be, the rights they would have acquired until the time of termination in the capital stock of BONGARA 

22.3   The Parties agree that in case of termination of this Agreement, regardless of the cause, the Mining Assignment Agreement referred to in clause six shall be automatically terminated, without need of any further formality or declaration whatsoever.

22.4   If termination of this Agreement by VOTORANTIM occurs before MINERA SOLITARIO performs the FIRST OBLIGATION TO CAPITALIZE then VOTORANTIM shall fulfill any Continuing Obligations that remain subsequent to the date of termination.  If termination occurs after the FIRST OBLIGATION TO CAPITALIZE as a result of a Party no longer retaining a shareholding interest in BONGARA then any proportionate liabilities that constitute Continuing Liabilities that accrued to the Party prior to the forfeiture of its shareholding interest shall survive.

22.5   At any time after the FIRST OBLIGATION TO CAPITALIZE, if any Party forfeits it shareholding interest in accordance with section 11.3 it shall no longer be a Party to this Agreement.  However, it is hereby agreed that even in that case, the stipulations applicable to the payment of the NSR royalty that might be payable at that time by BONGARA, as well as other provisions applicable for governing the Parties' relationship with respect to such royalty, the enforceability of the Continuing Obligations, dispute resolution provisions or other, will subsist and apply mutatis mutandis.

Twenty three:          Access to Information

The Operator shall provide other Parties, when requested, with access to all the information acquired during the effective term of this Agreement and regarding any of the stages or phases of performance, as well as the right to examine and copy such information, including, inter alia, maps, drill logs, drill cores, reports, surveys, assays, analyses, production reports and operations records, and all technical, accounting and financial records. 

Twenty four:          Confidentiality and Press Releases
24.1   All data, reports, records and other information of any kind developed or acquired by any Party in connection with this Agreement, shall be treated by the Parties as confidential (hereinafter referred to as the "Confidential Information"), and no Party shall reveal such Confidential Information to third parties without the prior written consent of the other Party. Confidential Information that is available or that becomes available in the public domain, other than through a breach of this provision by a Party, shall no longer be treated as Confidential Information.

24.2   The foregoing restrictions shall not apply to the disclosure of Confidential Information to any Affiliate or Subsidiary, to any public or private financing agency or institution, to any contractors or subcontractors which the Parties may request and to employees and consultants of the Parties, or to any third party to which a Party intends to transfer, sell, assign, or encumber its position in this Agreement or shares in BONGARA; understanding further that in such case, only such Confidential Information that such third party shall have a legitimate need to know, shall be disclosed, and the person to whom such disclosure is made shall first undertake in writing to protect the confidential nature of such information, at least to the same extent as the Parties are obliged under this clause.

24.3   In the event that one of the Parties is required to disclose Confidential Information to any government, court, agency or department thereof, or to any stock exchange, to the extent required by applicable law, rule or regulation, or in response to a legitimate request for such Confidential Information, the Party so required shall immediately notify the other Party hereto of such requirement and the terms thereof, and the proposed form and content of the disclosure, prior to such submission.  The other Party shall have the right to review and comment upon the form and content of the disclosure and to object to such disclosure before the court, agency, stock exchange or department concerned, and to seek confidential treatment of any Confidential Information to be disclosed on such terms as such Party shall, in its sole discretion, determine.

24.4   The provisions of this clause apply to both Parties during the term of this Agreement and shall continue to apply for a period of two (2) years after termination hereof. Likewise, in case any of the Parties surrenders, assigns, transfers or otherwise disposes of its position in this Agreement or its interest in BONGARA, the provisions set out in this clause shall apply to it during a period of two (2) years counted from the date of such surrender, assignment, transfer or disposition.  However, if the termination of this Agreement takes place due to the default or voluntary decision of one of the Parties to withdraw, the other Party shall be released from the confidentiality obligation and may use the confidential information to offer or negotiate with a third party any rights, assets or issues related to the project.

24.5   Unless required by any governmental entity or stock exchange, none of the Parties shall issue any press release relating to the Properties or this Agreement, except upon giving the other Party three (3) days' advance written notice of the content thereof, and the Party proposing such press release shall make any reasonable changes to such proposed press release as such changes may be timely requested by other Party.  The Party proposing the press release may include therein, without notice to the other Party, any information previously reported by the Party proposing the press release.  None of the Parties shall, without the consent of the other Party, issue any press release that implies or infers that the other Party endorses or shares with the issuing Party the statements contained in the press release issued by it.

Twenty five:          Force Majeure

If any Party is hindered or prevented from performance of the terms or provisions of this Agreement, other than the payment of monies, by reason of any force majeure or act of God beyond the control of the Party, whether foreseeable or not, including without limitation law or regulation, inability or delay in obtaining any license, permit, or other authorization that may be required to conduct operations, weather, war, civil insurrection, labour disputes, acts of government, surface owner disputes, injunction prohibiting access to the Properties or like causes not subject to the Party's control, whether created by statute or otherwise, the time for the performance thereof of all obligations, except for governmental obligations required to maintain the Properties, shall be extended for a period equal to the period of the force majeure, provided such Party gives notice of the force majeure and diligently seeks to eliminate the force majeure and resume performance as soon as feasible thereafter. Immediately  upon the cessation of force majeure the affected Party shall notify the other Parties in writing and shall take steps to recommence and or continue the performance that was suspended as soon as reasonably possible.

Twenty six:          Notices
26.1   Any notice, instruction or other instrument that may be sent in accordance with this Agreement shall be made in writing and, if delivered, shall be deemed to be sent and received on such date as it is delivered.  If sent by mail, it shall be deemed as given and delivered on the seventh (7th) business day following the date of remittance by mail, except in case of interruption of mail service, in 

35

<PAGE>
which case the notice shall be deemed to be received when actually received. If sent by telegram, telex, telecommunication or other similar form of communication ("Telecommunication") during normal business hours (9:00a.m to 5:00p.m - local time in the place of receipt ), it shall be deemed to be sent or received the same day it is sent, or in case of any Telecommunication sent beyond normal business hours, the next business day. 

In each case, notices shall be sent to the following addresses:
i.       If MINERA SOLITARIO:
Attn: Antonio Crovetto, General Manager, Walter Hunt

El Bucare 573, Camacho, La Molina

Lima, Peru

Telephone (51-1) 341 0660

Fax: (51-1) 435 5278

With copy to:

c/o Solitario Resources Corporation

Attn: Chris Herald, Walter Hunt

4251 Kipling St, Suite 390

Wheat Ridge, CO 80033, USA

Telephone: (303) 534 1030

Fax: (303) 534 1809

ii.      If VOTORANTIM:
VOTORANTIM METAIS - CAJAMARQUILLA S.A.

Attn: José Montoya Stahl

Gerente de Nuevos Negocios

E-mail: jose.montoya@vmetais.com.pe

Address: Paz SoldAn 170 of # 501, San Isidro, Lima 27, Peru

Phones: (51-1) 440- 1860; (51-1) 440-1870

26.2   At any time, any of the Parties may give written notice to the other on any change of address of the Party giving such notice; the address shall be deemed to be changed as from the time of receipt of said notice; then, as from that time, the address specified in the notice shall be deemed to be the address of said Party for the purposes of this Agreement. 

26.3   Any and all payments that must be made by virtue of this Agreement shall be deemed to be properly made if made to the address that according to this clause corresponds to the Party receiving the payment, unless said Party gives written notice of a different address where payments should be made.

Twenty seven:          Severability 

If any provision, agreement, condition or covenant in this Agreement, or the enforcement thereof by any of the Parties or under circumstance is null, the remainder of this Agreement and the enforceability of said provision to Parties or circumstances other than those causing it to be null, shall not be affected thereby, and each provision, agreement, condition or covenant of this Agreement shall be valid and enforced to the extent permitted by law, providing that said enforceable provision shall be restricted, limited or eliminated only to the extent necessary to avoid such  nullity in relation to the applicable law as it would then be applied, and the Parties may adopt any and all actions required to cause such null provision to be valid and enforceable, or, alternatively, to reach an agreement in relation to said null provision whereby each of the Party receives, as far as possible, substantially the same benefits and obligations based on valid provisions, provided that the Agreement is not enforced in a form that materially affects the commercial agreement between the Parties. 

36

<PAGE>

Twenty eight:          Assignment of Contractual Position

Without prejudice of the stipulations contained in clause ten, the Parties may not assign their contractual position and/or their rights and/or obligations under this Agreement without the express consent of the other Party, when such third party is an Affiliate or a Subsidiary of any of the Parties, provided, however, that the assignee or Party undertaking said rights and/or obligations also acquires the interest of the corresponding Party in BONGARA.  

The assignment of the Party's contractual position and/or rights and obligations under this Agreement to third parties that are not Affiliates or Subsidiaries of any of the Parties, shall require the prior written consent of the other Party, the same that shall not be unreasonably withheld.

Twenty nine:          Additional documents and other provisions
29.1   The Parties undertake to act in good faith and diligently to execute any and all private and/or public documents that may be necessary or convenient to enforce this Agreement. 

29.2   This document supersedes any agreement or other document that the Parties or its Affiliates or Subsidiaries may have previously entered into and/or executed in relation to the Properties, including the Letter of Agreement, as from the execution of this Agreement, this Agreement shall be the single document ruling the relationship between the Parties as far as the Properties are concerned.  If any other agreement or document entered into by the Parties contradicts terms contained in this Agreement, then the provisions of this Agreement and its amendments shall prevail.

29.3   The rights, duties, and obligations of the Parties hereunder shall be several and not joint or collective.  Each Party shall be responsible only for its share of the costs and expenses as provided herein.  It is expressly agreed that except for the incorporation of BONGARA and the terms specifically provided herein, it is not the purpose or intent of this Agreement, nor shall the same be construed as creating any mining, commercial or other partnership or the incorporation of a company.  Each Party shall remain a separate and independent company with its own legal identity.  This Agreement shall not be construed to provide for any joint marketing of ores, concentrates, or other substances produced from the Properties or to create any fiduciary relationship between the Parties.

29.4   The expenditures resulting from the execution of the public deed originating from this deed shall be borne by VOTORANTIM, including fees for registration in the Public Registry.

29.5   All references to a clause or section or contained in this Agreement, make reference to the relevant clause or section of this Agreement. References to a clause contained in this Agreement, shall include all sections within such clause, and references to a section shall include all paragraphs within such section.

Unless the context requires an interpretation on the contrary, the plural shall import the singular and vice versa; and the masculine the feminine and vice versa.

29.6   The amounts preceded by the "$" symbol or accompanied by the term "American Dollars" are expressed in Dollars of the United States of America.

29.7   It is hereby agreed by the Parties that the creation and existence of classes of shares in BONGARA, will not affect in any way or diminish VOTORANTIM's rights under this Agreement, nor will benefit MINERA SOLITARIO in any way not expressly provided herein. Therefore, MINERA SOLITARIO hereby declares and commits that for VOTORANTIM to effectively earn-in its interests in BONGARA as provided herein and in any issuance or transfer of the latter's shares, a sufficient number of shares will be issued and/or transferred to VOTORANTIM (irrespective of their class) in order to allow the latter to fully exercise absolutely all the rights that VOTORANTIM will at that time be entitled 

37

<PAGE>
to exercise in accordance to this Agreement, including, but not limited to, the exercise of as many voting rights in BONGARA's corporate bodies, as shares VOTORANTIM might hold in such company's capital stock.  

Thirty:          Applicable law and arbitration
30.1   This Agreement, as well as the rights and obligations of the Parties hereunder, shall be governed by the laws of the Republic of Peru. 

Any dispute that may arise between the Parties in relation to this Agreement related to its interpretation and/or execution, including those related to the nullity or validity thereof, the compliance or non-compliance of the Parties in respect of the obligations contained herein, that may not be resolved directly through negotiation by the Parties, shall be settled at the request of any Party by arbitration of law.  The Arbitration Court shall be composed by three (3) members, and its award shall be final and not subject of appeal.

Such arbitration shall be conducted under the rules and supervision of the Peruvian-American Chamber of Commerce (AMCHAM).

In any arbitration between the Parties in connection with this Agreement or the construction or enforcement thereof, the substantially prevailing Party shall be entitled to recover all reasonable costs, expenses, legal and expert witness fees and other costs of suit incurred by it in connection with such arbitration, including such costs, expenses and fees incurred prior to the commencement of the litigation, in connection with any appeals, and in collecting or otherwise enforcing any final judgment entered therein.  If a Party substantially prevails on some aspects of such action, but not on others, the arbitration court may apportion any award of costs and legal fees in such manner as it deems equitable.

The Parties expressly waive to the conciliation procedure provided under Law No. 26872. 

38

<PAGE>

Executed by the Parties in sign of conformity and acceptance, in Lima, on March 23, 2007.

 

/s/ Walter Henry Gage Hunt

Walter Henry Gage Hunt 

President of the Board Directors

MINERA BONGARÁ S.A.

 

/s/ Walter Henry Gage Hunt

Walter Henry Gage Hunt 

President of the Board Directors

MINERA SOLITARIO PERU S.A.C.

 

/s/ Walter Henry Gage Hunt

Walter Henry Gage Hunt 

President, South American Operations

SOLITARIO RESOURCES CORPORATION

 

/s/ Jorge Paulo Rodriguez del Gaizo

Jorge Paulo Rodriguez del Gaizo 

Financial and Administration Manager 

VOTORANTIM - CAJAMARQUILLA S.A.

 

/s/ Alberto Gazzo Baca

Alberto Gazzo Baca

Representative

VOTORANTIM - CAJAMARQUILLA S.A.

39

<PAGE>

ANNEX A

LIST OF THE PROPERTIES 

	
Name
	
Code
	
Area (Has)
	
Registration 

	
BONGARA VEINTISIETE
	
01-07835-95
	
300
	
20005021

	
BONGARACINCUENTICUATRO
	
01-02332-96
	
600
	
20004464

	
BONGARA CINCUENTICINCO
	
01-02333-96
	
1000
	
20004465

	
DEL PIERO TRES
	
01-03386-05
	
700
	
11053962

	
DEL PIERO CUATRO
	
01-00002-06
	
500
	
11055358

	
DEL PIERO CINCO
	
01-00003-06
	
1000
	
11053964

40

<PAGE>

41

<PAGE>

 

ANNEX D

NET SMELTER RETURN ROYALTY
1.      Definitions:  The words and terms defined in the agreement of which this annex forms part, shall have the same meaning for the purposes of this annex, unless specified otherwise.

1.1     "Agreement" shall be the Framework Agreement for the Exploration and Potential Development of Mining Properties of which this annex forms an integral part.

1.2     "THE DILUTED SHAREHOLDER" shall mean BONGARA's shareholder which participation in the capital stock of said company is diluted to less than 10%, as provided in section 11.3 of the Agreement.  As a result of such dilution, THE DILUTED SHAREHOLDER's participating interest in BONGARA will be terminated and substituted with a 2% NSR Royalty.

1.3     "NSR Royalty" shall mean the 2% NSR royalty that BONGARA shall be required to pay to THE DILUTED SHAREHOLDER and that shall be calculated according to the Net Smelter Returns, in accordance with the provisions set out in section 11.3 of the Agreement and this annex.  Such royalty will only be payable if Commercial Production has been initiated.

1.4     "Net Smelter Returns or NSR" shall mean the net amount, including all bonuses and subsidies that a given smelter, refinery or other buyer of Products pays to BONGARA; and that will result after making the deduction of all costs, expenses and charges paid or incurred in relation to the Products after concentration thereof (regardless of whether those costs had already been deducted by the acquirer of the Products or incurred in by BONGARA).
The costs referred to in the preceding paragraph include, without the following being limitative but merely referential, smelt, treatment and refining costs (including, without limitation, metal losses, impurity penalties and sampling and arbitration services); commissions for the sale of Products and costs related to their sale.

Such costs further include all types of taxes, royalties and/or customs and tariff duties, with the exception of income or similar taxes that BONGARA is required to pay for the extraction, treatment, transportation, storage, exportation and/or sale of the Products. They also include the costs incurred for the conversion of leachable solutions into cathodes and other similar goods, in addition to the costs incurred in the storage and transportation of the Products from the Properties to the smelter, refinery and/or final market where the Products are finally placed, or between any such places; and the costs incurred in buying insurance policies or paying freight associated with the Products during transportation or storage.

1.5     "Products" shall mean the ore resources extracted and recovered from the Properties, and the solutions, concentrates or cathodes obtained through leaching or solution extraction or other treatment of the ores extracted and recovered from the Properties. 
The Products shall not include ores extracted outside the Properties' area, neither solutions, concentrates nor cathodes obtained from mineralized material extracted outside the Properties' area, whether placed in the Properties for leaching or other treatment, or conveyed to the Properties for treatment and/or storage.

2.      Date of payment of NSR Royalties:  Payment of the NSR Royalty will be made by BONGARA to THE DILUTED SHAREHOLDER on a quarterly basis.  Therefore, payment of the NSR Royalty will be made with respect to the sale of minerals 

42

<PAGE>
extracted and removed from the Properties and effectively paid for to BONGARA in each quarter. 

Within the ten (10) calendar days following the beginning of each quarter, BONGARA shall deliver to THE DILUTED SHAREHOLDER the NSR Royalty's payment settlements with the calculation of the NSR Royalty determined in accordance with this Annex.  

Attached to the aforesaid settlement, BONGARA will deliver to THE DILUTED SHAREHOLDER the certified checks referred to in section 3 below, copies of the minerals' sale settlements that may correspond, as well as any other information supporting the calculation of the NSR Royalties. THE DILUTED SHAREHOLDER shall immediately deliver to BONGARA the invoice corresponding to the payment made by BONGARA.

3.      Method of Payment: Payment of the NSR Royalties shall be made through the delivery of certified checks issued by BONGARA to the order of THE DILUTED SHAREHOLDER. The delivery of said checks will be made at the address established for those effects in the Agreement by THE DILUTED SHAREHOLDER. 

The payment of the NSR Royalties shall be deemed to have occurred upon receipt by THE DILUTED SHAREHOLDER of the certified checks referred to in the preceding paragraph. It is hereby established that BONGARA shall only be obliged to make those payments to THE DILUTED SHAREHOLDER, and not to another party, unless otherwise agreed between BONGARA and THE DILUTED SHAREHOLDER.

4.      Objections to the NSR Royalty payment:  THE DILUTED SHAREHOLDER may contest the royalty's payment settlements prepared by BONGARA within fifteen (15) calendar days following their receipt. If THE DILUTED SHAREHOLDER fails to make any objections to the NSR Royalty payment settlements forwarded by BONGARA within such fifteen (15) calendar days term, such payment settlements shall be deemed to have been accepted and approved. 

5.       Audit: If within the term referred to in section 4 above, THE DILUTED SHAREHOLDER made any objections to the NSR Royalty payment settlements submitted by BONGARA, THE DILUTED SHAREHOLDER and BONGARA shall make their best efforts to reach an agreement regarding any differences which may have arisen between them.

If BONGARA and THE DILUTED SHAREHOLDER fail to reach an agreement within fifteen (15) calendar days following the date in which THE DILUTED SHAREHOLDER notifies its objections to BONGARA, the differences between such parties shall be submitted to a final and conclusive analysis by a consultant firm mutually agreed upon between BONGARA and THE DILUTED SHAREHOLDER . The expenses for the hiring of such consultant firm shall be borne by THE DILUTED SHAREHOLDER. 

The consultant firm referred to in the preceding paragraph shall conduct an audit of all the documents supporting the NSR Royalty payment settlements subject to observations by THE DILUTED SHAREHOLDER, as well as of all such other information and/or documents as are necessary to that effect. The audit shall take place at the place to be designated by BONGARÁ for those effects and during the business hours of the latter.

If the audit reveals that the calculation of the NSR Royalties made by BONGARA is within a 2.5% range of the audit results, the cost of the audit shall be fully borne by THE DILUTED SHAREHOLDER. However, if the audit reveals that the calculation of the NSR Royalties made by BONGARA exceeds the 2.5% range of the audit results, BONGARA shall bear the costs thereof. 

43

<PAGE>
Upon completion of the audit and delivery of the results to BONGARA and THE DILUTED SHAREHOLDER BONGARA shall pay, without any interests, any additional NSR Royalties that might have been determined by the audit. Such payment will be made by BONGARA within fifteen (15) calendar days of receipt of the audit.  

However, if the audit determined that BONGARA paid NSR Royalties in excess of what is was really obliged to make, THE DILUTED SHAREHOLDER shall reimburse BONGARA the amount paid in excess by it (without interests) within fifteen (15) calendar days of receipt of the audit.  

6.      Sales to an Affiliate or Subsidiary of BONGARA:  Any smelter or refinery owned or controlled by BONGARA or any Affiliate or Subsidiary thereof, shall be deemed to be a treatment smelter or refinery for purposes of calculation of the Net Smelter Returns.  

Net Smelter Returns on Products acquired by such refinery or smelter shall be calculated and determined in accordance with customary treatment smelting and refining practices, as if sold to such smelter or refinery by third parties.  

However, the amount of such Net Smelter Returns shall not be less of what BONGARA would have received if the Products had been sold to a smelter or refinery owned by a third party different from BONGARA or from of an Affiliate or Subsidiary of the latter.

7.      Prudent operations:  The ores (even after undergoing some type of treatment) extracted and recovered from the Properties, may be commingled with ores (even after undergoing some type of treatment) with a similar composition extracted from other mining Properties other than the Properties.  

All determinations required for the calculation of the Net Smelter Returns, including, without limitation, the metal grade of ores extracted from the Properties, and the metal grade or amount of metal recovered from such ores, shall be made by BONGARA in accordance with prudent engineering, metallurgy and cost accounting practices.  
********************

44

<PAGE>

ANNEX E

REPRESENTATIONS AND WARRANTIES OF MINERA SOLITARIO

For purposes of this Annex, the words and terms defined in the Agreement of which this annex forms part, shall have the same meaning for the purposes of this annex, unless specified otherwise.

MINERA SOLITARIO hereby expressly represents and warrants VOTORANTIM the following:
1.      To the best of its knowledge all information provided to VOTORANTIM by MINERA SOLITARIO with respect to BONGARA and the Properties prior to the date hereof, is correct and there is no material fact or information of which MINERA SOLITARIO is aware which might render any of that information inaccurate or misleading or which might reasonably be expected to adversely affect the willingness of VOTORANTIM to enter in the Agreement.

2.      SOLITARIO RESOURCES CORP. and MINERA SOLITARIO PERU S.A.C. are the sole legal and beneficial owners of the 100% of shares issued by BONGARA, as set forth opposite to their respective names below:

	Shareholder

	
Number of shares

	
SOLITARIO RESOURCES CORP.
	
440,050

	
MINERA SOLITARIO PERU S.A.C.
	
236,950

	
TOTAL
	
677,000

 
3.      SOLITARIO RESOURCES CORP. and MINERA SOLITARIO PERU S.A.C. have the right to exercise all voting and other rights over 100% of the shares issued by BONGARA.

4.      BONGARA exists and is a duly organized and validly existing and duly incorporated, according to the laws of the Republic of Peru.

5.      All the shares issued at the date hereof by BONGARA, comprise all the issued and allotted share capital of such company, and have been properly and validly issued and allotted and are each fully paid.

6.      No person has the right (whether exercisable now or in the future and whether contingent or not) to call for the allotment, conversion, issuance, registration, sale or transfer, amortisation or repayment of any of the shares issued by BONGARA, or loan capital or any other security giving rise to a right over, or an interest in, the capital of BONGARA under any option, agreement or other arrangement.  

7.      There are no liens or encumbrances of any kind over the shares issued by BONGARA.

8.      BONGARA has no interest in, and has not agreed to acquire, any share capital or other security of any other company (whether incorporated or not).

9.      All shareholders that have ever had a shareholding stake in BONGARA, have been lawfully bought out, squeezed out, excluded and/or separated from BONGARA, in strict compliance with the applicable law.

10.    The registers and minute books, books of account and other records of whatsoever kind of BONGARA in all material respects:

10.1     are up-to-date;

10.2     are kept in accordance with applicable law; and,

10.3     contain complete and accurate records of all matters required to be dealt with in such books and records.

11.     All filings, publications, registrations, records, documents and returns required by applicable law to be delivered or made by BONGARA to registries or any other relevant regulatory or governmental body in Peru, have been so made on a timely basis.

45

<PAGE>
12.      With respect to BONGARA's accounting books and records (the "Accounts"):
12.1   The Accounts have been prepared in accordance with the applicable laws and in accordance with the accounting principles, standards and practices generally accepted at the date of their preparation in Peru ("Peru GAAP").

12.2   The Accounts accurately represent the assets, liabilities and state of affairs of BONGARA and of the profits or losses of said company for the period concerned.

12.3   The Accounts have been properly maintained and constitute a reasonably accurate and complete record of all matters and where required by the applicable law, have been duly filed in all material respects with the statutory accounting requirements including the requirements with respect to taxation. 

12.4    As of the date hereof, BONGARA has no obligation, indebtedness, liabilities or contingencies, that may be material and which according to the Peru GAAP ought to be reflected in the Accounts or their notes, other than those reflected in the Accounts.

13.    There is no outstanding guarantee, indemnity or security granted by BONGARA or for the benefit of BONGARA.

14.    There are no liabilities, whether actual or contingent, of BONGARA; none of which results in a material adverse change in the financial position or prospects or turnover of BONGARA.

15.    There are no liabilities or debts, whether actual or contingent, of BONGARA owed or outstanding which may become owed or outstanding to any of its Affiliates or Subsidiaries.

16.     All the assets included in the Accounts or acquired by BONGARA:

16.1     Are legally and beneficially owned by BONGARA;

16.2     Are in the possession or under the control of BONGARA; and,

16.3     Are free from liens or encumbrances.

17.     BONGARA has not been notified by a third party that it infringes any intellectual property rights of any persons.

18.     Except for the following agreements, BONGARA is not a party to or subject to any contract, transaction, arrangement, understanding or obligation, provided that BONGARA is not, or has not agreed to become, a member of any joint venture, consortium, partnership or other unincorporated association:
18.1     Contrato de arrendamiento celebrado con la senora GLORIA TORRES CIEZA DE DIAZ respecto de un inmueble ubicado en Av. Marginal No. 828, distrito de Pedro Ruiz Gallo, provincia de Bongara, departamento de Amazonas.  El plazo de dicho contrato vence el 20 de marzo de 2007.

18.2     Contrato de arrendamiento celebrado con el senor VICTOR CAMPOS  AGUILAR respecto de un inmueble ubicado en Av. Marginal sin numero, distrito de Jazan, provincia de Bongara, departamento de Amazonas.  El plazo de dicho contrato vence el 2 de julio de 2007.

18.3     Contrato de arrendamiento celebrado con el senor ANGEL SANTILLAN CAMUS respecto de un inmueble ubicado en Av. Marginal sin numero, distrito de Pedro Ruiz Gallo, provincia de Bongara, departamento de Amazonas.  El plazo de dicho contrato vence el 6 de julio de 2008.

18.4     Contrato de servidumbre celebrado con la comunidad campesina de Shipasbamba, en virtud del cual BONGARA se encuentra facultada a utilizar un territorio comunal ubicado en el distrito de Shipasbamba, provincia de Bongara, departamento de Amazonas, para la realizacion de actividades mineras.

46

<PAGE>

19.    All agreements entered into by BONGARA or with respect of which BONGARA is a party to, were valid, binding and enforceable for the parties thereto, and the terms thereof had been complied with by BONGARA and in all material respects by each other party to such contracts as of the Initial Date.  

20.    BONGARA is not a party to a contract with any Affiliate or Subsidiary.

21.    To the best of its knowledge there are no grounds for termination, avoidance or repudiation of any of such contracts or matters referred to in section 18 above and no notice of termination, breach or of intention to terminate has been received in respect of any of them.

22.     To the best of its knowledge all material licences, consents, authorisations, orders, warrants, confirmations, permissions, certificates, approvals, registrations and authorities (the "Licences") necessary for the carrying on of the businesses of BONGARA have been obtained, are in full force and effect, do not contain conditions which would hinder the ordinary and usual course of business and have been and are being complied with.

23.    To the best of its knowledge BONGARA is not currently, nor is reasonably expected to be, under investigation, enquiry or proceeding which is likely to result in the suspension, cancellation, modification or revocation of any Licence.

24.    To the best of its knowledge none of the Licences necessary for the carrying on of the business of BONGARA have been breached nor has BONGARA been informed that a License is likely to be suspended, modified or revoked (whether as a result of the entry into or completion of this Agreement or otherwise).

25.    To the best of its knowledge BONGARA is conducting, and has conducted, its respective business in compliance with applicable laws and it is not, nor has been in breach of any such laws.

26.    BONGARA has not received any notice or other communication (official or otherwise) from any court, tribunal, arbitrator, governmental agency or regulatory body with respect to an alleged, actual or potential violation and/or failure to comply with applicable laws, or requiring it to take or omit any action. 

27.    BONGARA (nor any person for whose acts or defaults BONGARA may be liable) is involved whether as claimant or defendant or other party in any claim, legal action, proceeding, suit, litigation, prosecution, investigation, enquiry, mediation or arbitration. 

28.    To the best of its knowledge no claim, legal action, proceeding, suit, litigation, prosecution, investigation, enquiry, mediation or arbitration is pending or threatened by or against BONGARA (or any person for whose acts or defaults BONGARA may be liable), provided that there are no investigations, disciplinary proceedings or other circumstances likely to lead to any such claim or legal action, proceeding, suit, litigation, prosecution, investigation, enquiry, mediation or arbitration.

29.    Neither BONGARA nor any of the Properties, assets or operations which it owns or in which it is interested, is subject to any continuing injunction, judgment or order of any court, arbitrator, governmental agency or regulatory body, nor in default under any order, licence, regulation or demand of any governmental agency or regulatory body or with respect to any order, suit, injunction or decree of any court.

30.    All taxes of any nature whatsoever for which BONGARA is liable and which has fallen due for payment, has been duly paid. 

31.    To the best of its knowledge BONGARA has fulfilled fully and opportunely all other obligations and charges imposed by the respective and applicable legislation and tax regulations.

47

<PAGE>
32.    BONGARA has paid fully and opportunely all taxes, fees, interest, rights, contributions and municipal licenses of any kind, including the corresponding monthly income tax prepayments. 

33.    BONGARA has not made any payment to non Peruvian-domiciled individuals or entities, including the payment of dividends, for which it might exist the obligation of withholding any Income tax or any other tax.  

34.    BONGARA has presented timely and in good faith all the declarations and reports required by the laws, rules and regulations of autonomous entities and instructions and circulars of administrative entities, related to taxes, customs, foreign exchange, and social security in general. BONGARÁ has complied with paying all applicable fines when not filing in due time, its tax returns. 

35.    BONGARA has properly and punctually paid all taxes which it has become liable to pay and it has never paid or become liable to pay, nor are there any circumstances by reason of which it is likely to become liable to pay, any penalty, fine, interest or surcharge in connection with taxation matters.

36.    BONGARA has not been subject to or is currently subject to any investigation, audit or visit by any tax or excise authority.

37.    BONGARA is not or will not become liable to the payment of taxes chargeable primarily on any other party, including, without limitation, social security payments for subcontractors.

38.    BONGARA has not been notified with any administrative resolution whereby the revenue authorities demand the payment of any due taxes. 

39.    BONGARA is not involved in any tax related proceeding nor is subject to the fractioning of any tax debt. 

40.    BONGARA has not made any payment to entities domiciled in tax havens. 

41.    BONGARA has not conducted any international trade transactions for which a customs-related contingency could exist.

42.    Except as provided in the Accounts, BONGARA has no liability for taxes on income or gains except in respect of and to the extent of income and profits actually received, nor do any arrangements exist which might give rise to such a liability.

43.    BONGARA has complied in all material respects with all statutory requirements, orders, provisions, directions or conditions relating to any applicable added value, goods and services or sales tax.

44.    BONGARA has complied with all formalities and requisites imposed by the applicable law for the use of the IGV paid as a tax credit, particularly in connection to, although not limited to, the IGV paid in relation to the goods acquired by BONGARA. 

45.    BONGARA's business has not been materially and adversely affected by any abnormal factor not affecting similar businesses to a like extent and there are no facts which are reasonably likely to give rise to any such effects;

46.    BONGARA is not or has not become insolvent under the laws of Peru or unable to pay its debts as they fall due, provided that BONGARA has not proposed nor intends to propose any arrangement of any type with its creditors;

47.    BONGARA has not been granted nor has applied for any financial facility.

48.    There have been or are no proceedings in relation to any compromise or arrangement with creditors or any winding up, bankruptcy or other insolvency proceedings concerning BONGARA and, no events have occurred which, under applicable laws, would justify such proceedings;

49.    No steps have been taken to enforce any security over any assets of BONGARA and no event has occurred to give the right to enforce such security.

48

<PAGE>
50.    There are no powers of attorney or authorizations granted to persons other than those that appear in BONGARA's respective entry in the Lima Public Registry, and BONGARA have not granted any other powers or authorities different than those reflected in the respective BONGARA by-laws.  

51.    BONGARA has never had any dependent worker to whom the labor regime that governs private activities in Peru might be applicable. 

52.    BONGARA has never hired any individual for the rendering of independent services ("recibos por honorarios profesionales").

53.    BONGARA has never opened a payroll book before the Ministry of Labor, because it has never had employees.

54.    BONGARA does not owe any amount for the payment of salaries, legal gratifications, family assignations, extra time and/or vacations, to individuals to which that might have had the right to receive any of those benefits.

55.    BONGARA does not pay and has never paid any kind of "of the payroll" salary or compensation to any employee. 

56.    BONGARA does not have any employee working for it on "of the payroll" status".

57.    BONGARA has never been involved in any labor administrative procedure.

58.    BONGARA is not involved in any administrative procedure related to the payment or reimbursement of contributions to the Health Social Security (ESSALUD) or to the National System of Pensions (ONP).

59.    BONGARA is not involved in any judicial proceeding initiated by any company forming part of the Private System of Pensions (AFP's) for the payment or reimbursement of labor or pension related contributions. 

60.    BONGARA has never been involved in any labor related judicial proceeding. 

61.    BONGARA has never been subject of inspections by the labor authorities in order to verify its compliance with the labor regulations. 

62.    BONGARA does not owe any amount to any individual for Compensation of Length of Services (CTS).

63.    There is any measure related to occupational security and hygiene that has not been adopted by BONGARA and that should have been adopted in compliance with applicable law.

64.    BONGARA has not hired any individuals under formative regimes (trainees, juvenile labor training, etc.).

65.    BONGARA has never maintained or maintains any contractual relationship with entities providing labor intermediation or similar services (intermediación laboral, tercerización de servicios).

66.    BONGARA has not committed any labor infraction.

*********************

49

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00130-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00130-of-00352.parquet"}]]