TEMIC GOLD LOI

TEMIC ENERGY LIMITED MIREMA ROAD OFF THIKA ROAD, BEHIND SAFARI PARK HOTEL, NEXT TO USIU

POST OFFICE BOX 22350 - 00400 NAIROBI, KENYA TEL: +254-729-252856 / +254-774-191363 / +254-722-335410 / +254-722-369184

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July, 2012 Miners/End Sellers Dear Sirs, Re: PRELIMINARY INFORMATION FOR MINES / SELLERS OF AU DUST, NUGGETS, DORE BARS EX AFRICA REFERENCE DIRECT REFINERY PURCHASE * DIRECT METALS ACCOUNT WITH A LEADING REFINERY * 2 LEADING REFINERIES AVAILABLE (EUROPE AND UAE) * REFINERY PAYMENT GUARANTEE / BANK LETTER OF CREDIT AVAILABLE THESE NOTES ARE INTENDED AS A GUIDELINE FOR INFORMATION PURPOSES ONLY We have recently established facilities for a Registered Charity, engaged in the provision of clean water, educational and medical services in various parts of Africa, to facilitate access to two leading AU Refineries for the benefit of Mining Communities with whom they engage. The Miners are provided with a fair price for their AU Dust and Nuggets plus a Refinery Payment Guarantee/ LC if required. This facility enables improvements to their living and working conditions together with the local infrastructure. We administer the facility ourselves with a similar arrangement in place for Copper Cathodes and Blister which are purchased by one of Europe’s leading Multinational Buyers. In tandem with this arrangement we have agreement for similar facilities to be available to others directly introduced through ourselves ONLY. Most will already be aware that it is extremely unusual for any Refinery to offer any form of payment guarantee as is available here. THE BUYERS : will be one or other Refinery DIRECT. One is in the Middle East and the other in mainland Europe. They will offer approved Mines / Sellers their own Metals Account and the identities of the Refineries will be confirmed ONLY when the Metal Account has been agreed in principle and the Service Agreement signed. ESTABLISHING YOUR METALS ACCOUNT: As a first step Sellers will be asked to provide certain documentation and information for Due Diligence purposes. The background will be authenticated, a report prepared, and the proposal submitted to one or other Refinery for approval. We prepare this Due Diligence report ourselves and have considerable experience in arranging Metals Accounts with leading Refineries. When we submit the report and supporting paperwork the Refinery is entitled to authenticate any information presented but we have assurances that this will be done with minimum possible delay. The normal time frame for acceptance is in the region of ten to twelve working days following provision of information / documentation. Opening a new metals account with any Refinery is now extremely difficult as a result of the



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numerous Laws, Rules, Regulations etc imposed by both National and International Authorities and implemented both through the Refineries themselves and in some cases the International Banking System and National Customs Authorities. The objective is not only to combat Terrorism but also to challenge the high levels of Crime in some countries. There are special arrangements in place for any product sought to be sold from "Conflict Areas" such as DRC and any such proposals will be dealt with separately. WHEN YOUR METALS ACCOUNT HAS BEEN AGREED IN PRINCIPLE: Proposed terms will be confirmed. At the outset you will be given "likely terms" and both figures should be close and normally will be identical. At this point you will be required to sign an Agreement with us appointing us as your (Joint) Mandate / Representative with the Refinery. This will NOT impact upon any existing arrangement or appointment of any Sellers Mandate that you may have made. We shall be happy to work jointly with those concerned. The Agreement will run for an initial period of five years. Throughout the period of the contract we shall act as your liaison with the Refinery and monitor all transactions providing assistance wherever needed. Additional assistance can be made available re the supply / purchase of new and second user Mining Equipment if required. On acceptance you will also be informed of any stipulations that the Refinery wishes to make re procedure such as delivery etc. ONCE THE METALS ACCOUNT HAS BEEN OPENED: You will have been advised whether or not any trial deliveries are required to establish capability to perform. These can be between five and twenty kilos, at Sellers option, and are normally dealt with by Sellers on a "hand carry" basis. No financial instrument is ever provided for a trial. A detailed briefing will be provided to the Sellers for arrangements for these "hand carried" consignments at the relevant Airports. You will be briefed on exactly what documentation is required plus you will be given a direct contact number for the Refinery Representative at the relevant location. The Seller / Sellers Representative is welcome to be present at the Refinery for the smelt / assay process. The cost of flights or accommodation is not pre funded. WHEN THE TRIAL DELIVERIES HAVE BEEN COMPLETED (IF REQUIRED): The usual requirement is two trial deliveries to be made without problem. A Refinery Payment Guarantee, Letter of Credit, Bank to Bank confirmation / undertaking will then be made available on consignments to guarantee payment if required by the Sellers. This will be provided on a CONDITIONAL basis which means that payment can be drawn down following final assay report at the Refinery. A copy of this report is provided to the Seller and forms the basis for settlement. The proceeds of sale can be directed to any Bank account nominated by the Sellers. If any Banking assistance is required then this can provided. ONCE LARGER CONSIGNMENTS ARE SCHEDULED : The assumption is that one of the major Logistics/ Security Companies such as BRINKS or G4S will be involved. This will be discussed / agreed on an individual basis. It is confirmed that the Refinery will be responsible for dealing with all importation procedures / costs at the Port of entry including armoured transport



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from the airport to the Refinery location. THE TIME FRAME: between delivery to the Refinery and production of Assay Report and payment will depend upon what volume of material is being processed at any particular time but a guideline is three working days. In reality it is in fact frequently much quicker. THE SERVICE THAT WE PROVIDE: will not only provide the opening of the Metals Account but will provide ongoing assistance for all aspects of the transactions that follow. This includes obtaining a written confirmation from the Refinery, should this be needed, to support a Visa Application through to suggestions for accommodation at the two locations and assistance with procurement and shipping of equipment. Our objective is to establish long term business relationships focused on the Mine Owner / Seller getting a fair return on their refined product and thus ensuring continuity of supply. We are happy to discuss proposals in principle with the Refineries. If interested parties provide details of what quantities they are proposing on a monthly basis we shall provide likely Terms. Please be aware that on every completed transaction a "Royalty" of half of one per cent will be paid to the Charity in support of their Projects. Payment will be effected via a Swiss Trustee nominated for the purpose. This figure is included in the terms that will be provided. We thank you in advance and look forward to hearing from you as soon as possible. Sincerely yours, For: TEMIC ENERGY LIMITED

Jimmy Kairu

James W. Kairu Managing Director / Chief Executive Officer

TEMIC GOLD LOI

Business

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