Heads of Terms Agreement between Ivanhoe Electric Inc. and Saudi Arabian Mining Company Maaden dated January 11, 2023

Ma’aden (directly or through a subsidiary) shall purchase new common stock from Ivanhoe Electric at a price per share of USD 12.38.

The Strategic Investment by Ma’aden will represent a 9.9% shareholding in Ivanhoe Electric on a basic basis at the closing of the transaction. Ma’aden will have the right, in accordance with Clause 6 below, to subscribe for additional shares of common equity in certain circumstances.

Ma'aden and Ivanhoe Electric will enter into the following Project Contracts:

A.     a securities purchase agreement providing for the terms governing the acquisition of the Ivanhoe Electric shares by Ma'aden ("SPA");

B.      an investor rights agreement ("IRA") setting out the key rights that Ma'aden will be granted as an investor;

C.      a registration rights agreement ("RRA") setting out the key rights that Ma'aden will be granted in relation to registration of the new common stock that it holds; and

D.      a director indemnification agreement (“IA”) between Ivanhoe Electric and the appointed director substantially in the form Ivanhoe Electric utilizes for its directors (subject to Ma'aden's review of existing arrangements).

Ivanhoe Electric's legal advisors will prepare the first drafts of the SPA, RRA, and IA. Ma’aden’s legal advisors will prepare the first draft of the IRA.

The proceeds from the Strategic Investment shall be applied as follows:

A.     USD 60,000,000 for the working capital and general corporate use of Ivanhoe Electric and to advance Ivanhoe Electric's mineral projects;

B.      no more than USD 13,000,000 to purchase 3 Typhoon™ units from I-Pulse on terms to be negotiated with I-Pulse; and

C.      the remaining balance for investment into the Saudi JVCo, which will be used, among other things, to pay for services provided by I-Pulse to the Saudi JVCo (the "Balance").

Completion of the Strategic Investment will be subject to:

A.      approval from the Board of Ma'aden;

B.      approval from the Board of Ivanhoe Electric;

C.      approval of the related supplemental listing application being obtained by Ivanhoe Electric from the New York Stock Exchange ("NYSE"); provided, however, that such approval will not be required prior to execution of the definitive documentation relating to the Strategic Investment;

D.      approval being obtained by Ivanhoe Electric from the Toronto Stock Exchange ("TSX");

E.      to the extent applicable, expiration or termination of all applicable waiting periods and requests for information (and any extensions thereof) under the Hart-Scott-Rodino Act ("HSR Act");

F.      to the extent applicable, the parties receiving written confirmation from the Committee on Foreign Investment in the United States ("CFIUS") that it has completed its review or, if applicable, investigation and determined that there are no unresolved national security concerns with respect to the transactions contemplated by these Key Terms;

G.      any other foreign investment approvals; and

H.      the effectiveness of the Project Contracts relating to the Saudi JVCo in accordance with their terms.

For so long as Ma'aden and its affiliates retain at least an 8.00% shareholding in Ivanhoe Electric on a basic basis, Ma'aden shall be entitled to nominate for election one independent director to the Board of Ivanhoe Electric ("Ma'aden Independent Director"), provided that if Ma’aden and its affiliates fail to maintain such shareholding percentage because of a diluting event to which its top-up right does not apply, Ma’aden shall continue to have the right to such director nomination so long as it exercises its top-up right at its next first opportunity in order to maintain at least such 8.00% shareholding.

Whilst Ma'aden retains the right to nominate a director, if the Board of Ivanhoe Electric is expanded or if there is any vacancy with respect to any non-independent director, Ma'aden shall have the right to nominate a non-independent director in place of the Ma'aden Independent Director.

In the event that Ma’aden’s equity ownership in Ivanhoe Electric is diluted due to any new issuances of shares by Ivanhoe Electric (a “dilution event”), including upon:

A.    shares being issued to employees pursuant to any existing or future equity incentive plan, agreement or arrangement approved by the Board;

B.    any shares being issued on exercise or vesting of incentive securities; or

C.    shares being issued as acquisition consideration,

then, upon the first occurrence after such dilution event that Ivanhoe Electric issues shares (or securities convertible into shares) as part of an equity financing transaction in which such securities are issued by Ivanhoe Electric for cash (an “equity financing transaction”), Ma’aden will have a right to subscribe for additional shares of common equity of Ivanhoe Electric (a “top-up right”) to the extent of its “Existing Ownership Threshold” in Ivanhoe Electric. Upon the closing of the Strategic Investment, the “Existing Ownership Threshold” will be equal to 9.9% of the outstanding equity of Ivanhoe Electric on a basic basis.

In addition, in the event that Ma’aden’s equity ownership in Ivanhoe Electric is diluted 2.00% or more below its Existing Ownership Threshold (the “compelled top-up trigger”) by a dilution event, then Ma’aden shall have the right (a “compelled top-up right”) to exercise its top-up right either (1) at the first equity financing transaction occurring within 12 months of the effective time of such compelled top-up trigger (the “trigger effective time”) or, (2) if no equity financing transaction occurs within 12 months of the trigger effective time, at any time following the 12-month anniversary of the trigger effective time until the next occurring equity financing transaction.

In the event that an equity financing transaction occurs within 12 months of a dilution event and Ma’aden fails to exercise its top-up right concurrently with such equity financing transaction, or in the event that Ma’aden fails to exercise its compelled top-up right by or concurrently with the next occurring equity financing transaction following the 12-month anniversary of the last trigger effective time, Ma’aden’s Existing Ownership Threshold will be reduced to the level of Ma’aden’s percentage shareholding as of the effective time of the applicable dilution event (excluding any purchases by Ma’aden of Ivanhoe Electric stock from any third party on such date) (such reduced percentage shareholding, the “Reduced Ownership Threshold”), and the compelled top-up trigger will be reduced to a percentage that is 2.00% lower than the Reduced Ownership Threshold. Any subsequent dilution event will permit Ma’aden to exercise its top-up right in accordance with the above provisions only to the extent of the Reduced Ownership Threshold.

Ma’aden’s top-up right will remain in effect until the earlier of:

A.    five years from the date of completion of the Strategic Investment (the "Initial Period"), but only if within such five year period Ma’aden has (i) failed on two separate occurrences to exercise in full its top-up right or a compelled top-up right, or (ii) Ma’aden has sold, transferred or otherwise disposed of any shares of Ivanhoe Electric common stock (other than to an affiliate or to the PIF (as defined below));

B.     the first day following the Initial Period on which Ma’aden sells, transfers or otherwise disposes of any shares of Ivanhoe Electric common stock (other than to an affiliate or to the PIF (as defined below); and

C.    three years after the Initial Period.

The top-up right will be structured to allow Ma’aden to exercise its rights and not lose any of its rights (e.g., board seat, top-up right) while its awaits exercising such top-up right or while an exercise of the top-up right is pending closing. In addition, Ma’aden’s rights shall be preserved, subject to a maximum period of 12 months from the date on which Ma'aden's top-up right arises, as long as any legal or regulatory reasons (to be defined in the definitive documents) delay or prevent Ma’aden from exercising or closing its top-up right and Ma’aden will be allowed to exercise/close its top-up right once such legal or regulatory impediments no longer apply.

Ma’aden will be subject to a customary standstill provision pursuant to which neither Ma’aden nor any of its affiliates may beneficially own more than 19.99% of the Ivanhoe Electric common stock without the approval of the Board of Directors of Ivanhoe Electric. The standstill will expressly permit Ma’aden and its affiliates to make a confidential proposal to the Board at any time covering any matter otherwise prohibited by the standstill. The standstill will automatically be released in order for Ma’aden and its affiliates to make a competing offer if the Board enters into any agreement with a third party providing for a transaction that would result in a third party coming to have beneficial ownership of more than 50% of the outstanding common stock (“Change of Control”).

The standstill will remain in effect for five years following completion of the Strategic Investment (subject to customary carve-outs).

At any meeting of the shareholders of Ivanhoe Electric or with respect to any action by written consent of the shareholders of Ivanhoe Electric, Ma’aden will (“voting support”):

1.     vote in favor of any proposal to amend the certificate of incorporation or bylaws of Ivanhoe Electric approved by a majority of the independent directors of Ivanhoe Electric, provided that such amendment would not have a disproportionately adverse impact (definition to be defined in the Project Contracts) on the share rights of Ma'aden or conflict with any right to which Ma'aden is entitled under the Project Contracts;

2.     vote in favor of all matters submitted to the shareholders that have been approved by a majority of the independent directors of Ivanhoe Electric (other than in relation to circumstances in which it has been released from the standstill restrictions in accordance with Clause 8 above);

3.     vote in favor of the election of all director nominees of Ivanhoe Electric; and

4.     vote in favor of the appointment of any independent auditor selected by Ivanhoe Electric.

Such voting support will be Ma’aden’s independent obligation and will not be conditioned on the agreement and support of any other shareholder of Ivanhoe Electric.

The voting covenant will remain in effect for so long as Ma'aden retains its right to appoint a director.

Ma’aden and its affiliates will not, directly or indirectly, solicit, initiate, respond to or propose, or encourage, facilitate or assist in, any proposal or offer that constitutes, or could reasonably be expected to lead to, any company takeover proposal, or furnish to any person any confidential or other non-public information of Ivanhoe Electric, its subsidiaries or its affiliates for the purpose of encouraging, facilitating or responding to, any company takeover proposal or any proposal or inquiry that is reasonably expected to lead to a company takeover proposal.

The anti-takeover covenant shall remain in effect for five years following completion of the Strategic Investment (subject to customary carve-outs).

Ivanhoe Electric will, not later than 18 months after the completion of the Strategic Investment, file with the SEC a shelf registration statement on Form S-3 with respect to Ma’aden’s shares of Ivanhoe Electric, have it declared effective and use reasonable best efforts to maintain it (if Ivanhoe Electric becomes S-3 ineligible, then it will file an S-1 shelf registration statement) subject to customary blackout restrictions in case of an Ivanhoe-initiated underwritten public offering.

Ma’aden may not sell any shares registered pursuant to its registration right to any other mining company, to any SOE or to any entity that is controlled by an SOE (including, for the avoidance of doubt, any sovereign wealth fund, sovereign investment fund or social wealth fund), if such sale will bring such purchaser’s beneficial ownership of such shares (together with any shares held by its affiliates, group members or other concert parties) above 9.9% of the outstanding shares of common stock of Ivanhoe Electric, except, in each case, the PIF or an entity that is controlled by the PIF.

The registration rights will include:

A.      customary indemnification rights; and

B.      payment of reasonable expenses incurred in connection with the performance of, or compliance with the RRA and in connection with any registration or any offering and sale pursuant to the RRA.

Ma’aden will retain its registration rights for so long as Ma’aden and its affiliates retain at least 5.00% ownership in Ivanhoe Electric, subject to Section 13 below.

Any dispute, controversy or claim arising out of or in connection with the Strategic Investment, or the Project Contracts relating thereto, including the breach, termination or invalidity thereof (a "Dispute"), will be subject to a mandatory cooling-off period of thirty (30) days during which the parties shall take steps to resolve the dispute amicably.

In the event the Dispute is not resolved within the thirty (30) day period, referred to above, either party may, by written notice to the other party, request that the dispute be referred to a Dispute resolution committee constituted of one senior officer from each of Ma'aden and Ivanhoe Electric. The Dispute resolution committee shall be held in person, or by means of telephone, electronic or other communications facilities that permit the parties to communicate with each other during the meeting, within 10 days after such referral to attempt in good faith to resolve such dispute.

In the event the Dispute cannot be resolved by the Dispute resolution committee, then the parties agree that the Dispute will be finally resolved by binding arbitration administered by the American Arbitration Association, in accordance with the Commercial Arbitration Rules of the American Arbitration Association, by three (3) arbitrators (with each party selecting one (1) arbitrator and the selected arbitrators choosing the third), with the seat of the arbitration in New York, USA and English as the language of arbitration. The parties shall keep all proceedings, findings and awards of the arbitration confidential.

The primary purpose of the joint venture is for Ma’aden and Ivanhoe Electric to combine certain of their assets, technology, people and skills in order to survey, review, identify and explore prospective mineral deposits within the Kingdom under exploration licenses held by Ma’aden.

Should any economically viable mineral deposits within the Kingdom be identified as a result of the joint efforts of Ma’aden and Ivanhoe Electric, the parties intend to continue the 50:50 joint venture for the further development of such mining projects into operating mines.

The parties recognize that the primary use for the Typhoon™ units shall be on Ma’aden Land (as defined below). To the extent that Ma’aden proposes as part of the Saudi JVCo governance framework to use the Typhoon™ units on other land, Ma’aden and Ivanhoe Electric shall discuss such proposal in good faith.

The parties also agree that any survey to be conducted for metallic minerals through the use of the Typhoon™ units in the Kingdom on any land (whether or not licensed to Ma'aden) shall be carried out by the Saudi JVCo on an exclusive basis.

Incorporation of the Saudi JVCo shall be conditional upon receipt of approval from the General Authority for Competition Saudi Arabia ("GAC").

The parties shall work together in good faith to obtain clearance from GAC, or confirmation from GAC that a clearance is not required, as soon as possible following the Effective Date.

Ma’aden will make available to the Saudi JVCo approximately 48,500 km² of land which is regulated under its existing exploration licenses and which is located within the Kingdom as depicted in Schedule 6 (Ma’aden Land Area) (the "Ma’aden Land") for the purpose of conducting exploration activities to identify sub-area(s) of the Ma'aden Land that may be developed into an operating mine and in respect of which the relevant exploration license may be transferred to the Saudi JVCo if such land qualifies as a Designated Project.

Ma’aden will also contribute its existing geological mapping data relating to the Ma’aden Land to the Saudi JVCo.

Ivanhoe Electric will (where relevant through its affiliates or other third parties):

A.     use no more than USD 13,000,000 from the proceeds of the Strategic Investment to purchase 3 Typhoon™ units from I-Pulse; 

B.     use the Balance (as defined in Schedule 1, Section 3) for the initial funding of the Saudi JVCo;

C.     permit the use of one existing Typhoon™ unit to the Saudi JVCO; and

D.     enter into the Key Terms relating to Typhoon™ units and Other Technical Support as set forth in Schedule 3 (Key Terms relating to Typhoon™ Units and Technical Support).

Exploration Phase:

The "Exploration Phase" shall (subject to applicable laws, regulations and the terms of the exploration licenses relating to the Ma’aden Land) include:

A.    an initial exploration phase, which will last five (5) years; and

B.     a five (5) year extension if mutually agreed between the parties (10 years in total).

The Exploration Phase shall be implemented as follows:

A.     Identification of Land Area:

i.      Ma’aden’s exploration team in consultation with Ivanhoe Electric personnel will identify and recommend to the Technical Committee specific land areas for exploration within the Ma’aden Land, including the use of Typhoon™ (the "Recommended Land Area”).

ii.     The Technical Committee will review and, if appropriate, accept some or all of the Recommended Land Area for further work to be conducted including the use of Typhoon™ units through the Generative Exploration Stage.

iii.    Any portion of the Recommended Land Area conclusively rejected by the Technical Committee shall remain with Ma'aden and will be carved out of the Ma'aden Land (the "Undesignated Land"). Ma'aden shall thereafter be free to deal with the Undesignated Land in a manner as it sees fit and shall bear all costs relating to or arising from the maintenance of such Undesignated Land.

At this stage, the Saudi JVCo may apply to the Ministry for exploration licenses in respect of additional land areas complementary to the existing Ma’aden Land (the "Additional Land Areas").

For the avoidance of doubt, exploration licenses in respect of the Recommended Land Areas will not be transferred from Ma'aden to the Saudi JVCo at this stage of the process.

If there is a mineral discovery on the Ma’aden Land by the Saudi JVCo, then a 5km Area of Interest will be created around the then-known boundaries of the discovery (but such Area of Interest shall not extend into any Undesignated Land unless Ma’aden otherwise agrees). If the Area of Interest is not fully comprised of Ma’aden Land, then the Technical Committee may direct the acquisition of mineral rights in the Area of Interest by the Saudi JVCo and such land shall then form part of the Ma’aden Land and Designated Project as relevant and the terms of the JV shall otherwise apply to such additional areas. Neither Ma’aden nor Ivanhoe Electric may acquire any mineral interests or licences within the Area of Interest except for the purpose of contributing such mineral interests or licences to the Saudi JVCO as Ma’aden Land or Additional Land Areas and excepting in the case of Ma’aden, Undesignated Land that falls within an Area of Interest.

Governance of Saudi JV:

The Board will consist of a total of six (6) directors, initially with (3) directors to be appointed by Ma'aden and three (3) directors to be appointed by Ivanhoe Electric. If a party elects to sell a portion of its ownership stake in the Saudi JVCo (or is subject to dilution), a party will maintain its right to appoint one director for each twenty per cent (20%) ownership stake retained in the Saudi JVCO.

The Chairperson of the Board shall be appointed by Ma'aden. The Chairperson shall not have a casting vote.

The parties will allocate senior officer positions based on the principle of proportionality of the 50-50 joint venture.

Technical Committee

The Saudi JVCo will constitute a Technical Committee comprised of 4 members, with two (2) members to be appointed by Ivanhoe Electric and two (2) members to be appointed by Ma’aden.

The committee shall be responsible for all technical aspects of the joint venture, including oversight of the operator and review of work programs, budgets, and exploration results.

The Chairperson of the Technical Committee shall be appointed by Ma'aden. The Chairperson shall not have a casting vote.

Board Approvals:

Board Reserved Matters:

Exploration Phase and Appointment of Operator:

Upon effectiveness of a Designated Project, Ma'aden shall assume operatorship of the Saudi JVCo by giving 30 days’ prior written notice to Ivanhoe Electric. Ma'aden shall be entitled to a Management Fee as the operator of a Designated Project ("Exploitation Phase Management Fee").

The structure / amount of such Exploitation Phase Management Fee shall be agreed between the parties having regard to the relevant asset / block, period of operatorship and other criteria to be agreed. This concept shall be developed further between the parties and agreed methodology for calculation and payment of such Exploitation Phase Management Fee will be set out in the Shareholders' Agreement. The parties agree that such Exploitation Phase Management Fee shall not include nor give rise to any ‘profit element’ arising and/or accruing in favour of Ma’aden.

Any deadlock at Board level shall be referred to the shareholders for resolution in accordance with the terms of the Shareholders’ Agreement.

If the deadlock cannot be resolved by the shareholders, the deadlock matter shall be referred to the Chief Executive Officers of Ma'aden and Ivanhoe Electric who shall meet in person or by telephone, as soon as practicable, to attempt in good faith to resolve such dispute.

The Shareholders’ Agreement will include provisions dealing with deadlock.

The Saudi JVCo will be funded by each party through customary cash calls made in accordance with an approved budget, and a party that fails to fund will be subject to customary dilution.

No cash calls shall be required or made until the initial amount to be contributed by Ivanhoe Electric from the proceeds of the Strategic Investment has been expended. Such initial amount shall be used to cover, inter alia, the cost of services provided to the Saudi JVCo by CGI, the Operator and other service providers.

Once the applicable proceeds of the Strategic Investment have been expended, Ma'aden and Ivanhoe Electric will contribute 50 (Ivanhoe Electric): 50 (Ma'aden) to cash calls. If either party fails to fund, it will be subject to customary dilution.

If any additional financing is required (including equity financing if agreed), this shall be procured through third party financing from within the Kingdom and/or international financing sources on a non-recourse or limited-recourse basis (if commercially achievable) and in accordance with normal and sound business principles and the terms and conditions.

Distribution of Profits

No profits (if any) will be distributed during the Exploration Phase by way of dividend and no repayment of any shareholder loans shall occur.

Where excess available cash exists, shareholder loans may only be repaid in proportional amounts to each shareholder and the distribution of dividends will be paid in proportion to each party's shareholding and shall be in the same amount per share.

Transfer of Shares:

Exit and Termination Rights:

The Project Contracts will include an events of defaults regime in relation to a material breach of any of the Project Contracts (subject to applicable cure periods to be agreed) and standard provisions in relation to forced sale of shareholding at a discount to the third party determined fair market value of such shares upon the occurrence of an insolvency or bankruptcy event or a direct change of control of each shareholder of the Saudi JVCo without consent (but provided that a Change of Control of Ivanhoe Electric through a public take-over or arrangement process shall not be deemed to be a change of control for this purpose nor trigger a forced sale nor require any other consent or approval from Ma’aden or JVCo) ("Events of Default").

The joint venture shall not be terminable, other than upon the occurrence of an Event of Default, by either party until the end of the Exploration Phase.

The Parties shall negotiate in good faith to agree the terms of the definitive documents relating to the unwinding of the Saudi JVCo, withdrawal of contributed assets, the cross-termination of related agreements and exit rights (potentially including a royalty exit).

Any dispute, controversy or claim arising out of or in connection with the JVCo Investment or the Shareholders' Agreement relating thereto, including the breach, termination or invalidity thereof (a "Dispute"), will be subject to a mandatory cooling-off period of thirty (30) days during which the parties shall take steps to resolve the dispute amicably.

In the event the Dispute is not resolved within the thirty (30) day period, referred to above, either party may, by written notice to the other party, request that the dispute be referred to a Dispute resolution committee constituted of one senior officer from each of Ma'aden and Ivanhoe Electric. The Dispute resolution committee shall be held in person, or by means of telephone, electronic or other communications facilities that permit the parties to communicate with each other during the meeting, within 10 days after such referral to attempt in good faith to resolve such dispute.

In the event the Dispute cannot be resolved by the Dispute resolution committee, then the parties agree that the Dispute will be finally resolved by binding arbitration administered by the Saudi Center for Commercial Arbitration, in accordance with the Rules of the Saudi Center for Commercial Arbitration, by three (3) arbitrators (with each party selecting one (1) arbitrator and the selected arbitrators choosing the third), with the seat of the arbitration in London, United Kingdom and English as the language of arbitration. The parties shall keep all proceedings, findings and awards of the arbitration confidential. 

The Supplier, Analytical Services Provider, and Technology License Provider, in respect of its agreement; and

The Saudi JVCo (the "Purchaser").

The Technology License Provider is the owner of the patents to Typhoon™, being the brand name for an electrical pulse-powered geophysical surveying transmitter, which can detect the presence of sulphide minerals containing copper, nickel, gold and silver.

The parties desire to use Typhoon™, data inversion and analytical services of Computational Geosciences Inc. ("CGI"), and the extensive mineral exploration expertise of its personnel on certain lands as contemplated by the Key Terms for the JVCo Investment (the "Land").

The CGI Analytical Services Agreement will specify that CGI will be responsible for the supply of the services for the analysis of data and processing of the full spectrum of geophysical datasets in 3D produced by the Typhoon™ systems.

Charges for the services provided by CGI shall be on a cost pass-through basis.

Services to be provided by CGI for the analysis of data and processing of the full spectrum of geophysical datasets in 3D produced by the Typhoon™ units shall be provided under the Analytical Services Agreement for the period that the Saudi JVCo is continuing.

The Equipment Supply Agreement will specify that the Supplier will be responsible for the construction and delivery of three (3) Typhoon™ units to the Saudi JVCo for the purpose of exploration of land in accordance with the Key Terms of the JVCo Investment, in accordance with the following timeline:

a)       the first Typhoon™ unit no later than 28 February 2024;

b)       the second Typhoon™ unit no later than 30 April 2024; and

c)       the third Typhoon™ unit no later than 30 June 2024,

in each case subject to a 45-day grace period (“Grace Period”).

Ivanhoe Electric shall make an existing Typhoon™ unit available for use by Saudi JVCo as soon as practicable and in any case by no later than 30 days following completion of all conditions under the Project Contracts.

Ivanhoe Electric shall notify Ma’aden not later than 15 December 2023 whether the first new Typhoon™ unit will be delivered by 28 February 2024 or within the Grace Period. If the first new Typhoon™ unit will not be delivered within such period, Ivanhoe Electric shall make arrangements for a second existing Typhoon™ unit to be made available within such delivery window for use by Saudi JVCo as a temporary solution for such late delivery.

The first existing Typhoon™ unit shall be returned to Ivanhoe Electric once the second new Typhoon™ unit is delivered. If a second existing Typhoon™ unit is required to be made available such second Typhoon™ unit shall also be returned to Ivanhoe Electric once the second new Typhoon™ unit is delivered.

The Typhoon™ units must be fit for purpose and operate in accordance with specifications to be agreed between I-Pulse, Ivanhoe Electric and Ma’aden.

Subject to the next following sentence, the Supplier must also perform all work, supply all materials and provide (or arrange the provision of) all services not specifically mentioned in the Equipment Supply Agreement but which can be reasonably inferred from the Equipment Supply Agreement as being required for the proper operation of the Typhoon™ unit for the exploration of the Land as if such work, materials and services were expressly mentioned in the Equipment Supply Agreement, including the provision of services of advanced data analytics, geophysical modelling and AI for minerals discoveries, as well as services to be procured from CGI for the processing of the full spectrum of geophysical datasets in 3D produced by the Typhoon™ units. Ma’aden will use its reasonable efforts to assist in the procuring of equipment reasonably necessary for the operation of the Typhoon™ units, including assisting with local suppliers where possible.

The Purchaser will pay a contract price not exceeding USD 13,000,000 (or the equivalent in another currency) (the "Contract Price") to I-Pulse for the supply of three Typhoon™ units under the Equipment Supply Agreement.

The Contract Price will be inclusive of all taxes (other than any applicable value added tax), charges, fees, including income, revenue for the construction and delivery of the Typhoon™ units.

Retentions and withholdings by the Purchaser on account of taxes shall be made in accordance with the laws of the Kingdom of Saudi Arabia.

The VAT amount will be added to invoices rendered by the Supplier to the Purchaser.

The Supplier shall separately identify the VAT in the invoices so that the amount and rate of VAT invoiced is expressly identified. The separate breakdown is required for all rates, zero rate and exempt goods and services.

The Equipment Supply Agreement will contain market standard delivery requirements for the pilot scale testing and delivery of the Typhoon™ units.

Upon delivery, the Supplier shall provide to the Purchaser operation manuals and other documents required or desirable for the proper operation and maintenance of the Typhoon™ units.

The Supplier shall provide to the Purchaser all documentation reasonably required by it for the importation of the Typhoon™ units to Saudi Arabia.

Typhoon Licence and IP:

Licenced IP: Those patents owned by Geo27 Inc. (“Geo27”), a subsidiary of Ivanhoe Electric, as well as know-how and trade secrets relating thereto (the “Technology”).

License Fee: Nil. The License will form part of Ivanhoe Electric’s contribution to the Saudi JVCo.

Royalty for License: None.

Exclusivity: The License will be an exclusive license in the Licensed Territory within the Field of Use.

License Period: The period that the Saudi JVCo is continuing.

Licensed Territory: The Kingdom of Saudi Arabia.

Transfers: The License is non-transferable and non-assignable.

Field of Use: Subsurface mineral exploration.

Inventions and Improvements: Owned by Geo27.

Background IP:   IP rights/patents owned by either party before the joint venture shall remain under the ownership of such party or the relevant affiliate, including any improvements to Typhoon™ which shall remain owned by Geo27 and licensed to the Saudi JVCo.

Ownership of Surveys:   Ownership of the results of Typhoon™ surveys conducted under the License will be owned by the Saudi JVCo.

Except as expressly agreed otherwise, the party that discloses and makes confidential pre-existing data available hereunder (including any existing geological mapping, data relating to the land and other exploration information to be provided by Ma'aden) shall retain all rights, title and interests in and to the confidential pre-existing data and all Intellectual Property rights therein.

All rights, title and interests in and to the data generated or derived through the activities of the Saudi JVCo, including survey results and inversions generated from Typhoon™ data and inverted by CGI shall be retained by the Saudi JVCo.

The Equipment Supply Agreement will include indemnities from the Supplier in favour of the Purchaser in respect of claims and losses resulting from:

A.      the failure of the Supplier or its subcontractors to comply with law (including environment, permits);

B.      any infringement or alleged infringement of any third-party intellectual property by the Purchaser's use or possession of any intellectual property provided as part of the Typhoon™ units;

C.      breach of anti-corruption obligations; and

D.     personal injury or death occurring to any person and in respect of loss of or damage to any property, while under the responsibility of the Supplier, arising out of the performance by the Supplier under the Equipment Supply Agreement,

in all cases, subject to customary exceptions including (but not limited to) for example, the failure of personnel to operate Typhoon™ units according to manufacturer specifications.

I-Pulse’s warranties will include typical supplier warranties, including as a minimum, warranties that:

A.     I-Pulse will diligently proceed with the construction of the Typhoon™ units in a timely and professional manner acknowledging its order book, utilizing sound engineering principles, manufacturing standards and project management and supervisory procedures;

B.     I-Pulse has the required skills, licenses, qualifications and capacity necessary to construct the Typhoon™ units;

C.     the Typhoon™ units will be manufactured in accordance with the specifications, will perform in accordance with the performance parameters to be agreed and be fit for their intended purpose; and

D.     the Typhoon™ units will be capable of being operated and utilized in accordance with all relevant legal requirements, best industry practice and in a safe and reliable manner, and all applicable laws and standards.

Title to each Typhoon™ unit shall automatically vest in the Purchaser upon delivery to the delivery point Ex-Works.

The delivery point shall be the factory gate at the Typhoon™ factory in Toulouse, France (the "Delivery Point").

The Supplier shall be responsible for the care, custody and security of the Typhoon™ units until the delivery to the Delivery Point.

If any damage or loss happens to the Typhoon™ units while under the Supplier's responsibility, the Supplier shall at its cost repair and make good the Typhoon™ units.

The Purchaser may terminate the Equipment Supply Agreement if any of the following events occur:

A.      insolvency events affecting the Supplier;

B.       failure to pass tests on completion and/or deliver by the longstop date (to be agreed);

C.      wilful misconduct;

D.      fraud or corrupt acts;

E.      any of the Supplier’s representations and warranties are proven to be incorrect to a material extent;

F.      material breach (of the Equipment Supply and Technical Support Agreement) which is not remedied within thirty (30) Days, or a further sixty (60) Days where the Supplier has made and is continuing to make material progress towards a cure;

G.      material breach by Ivanhoe Electric of any other Project Contract or the other Project Contracts are terminated due to an act or omission of the Supplier; and

H.     breach of laws or relevant approvals once obtained, ("Supplier Event of Default").

The Supplier may terminate the Equipment Supply Agreement if any of the following events occur:

A.      insolvency events affecting the Purchaser;

B.      non-payment of material undisputed due and payable sums under the Equipment Supply Agreement within sixty (60) Days of the due date;

C.      Purchaser commits any other material breach of the Equipment Supply and Technical Support Agreement which continues for ninety (90) Days and is not remedied within a further thirty (30) Day cure period; or

D.     any of Purchaser’s representations and warranties are materially incorrect.

Any dispute, controversy or claim arising out of or in connection with the Project Contracts referred to in this Schedule 3, including the breach, termination or invalidity thereof (a "Dispute"), will be subject to a mandatory cooling-off period of thirty (30) days during which the parties shall take steps to resolve the dispute amicably.

In the event the Dispute is not resolved within the thirty (30) day period, referred to above, either party may, by written notice to the other party, request that the dispute be referred to a Dispute resolution committee constituted of one senior officer from each of Ma'aden and Ivanhoe Electric. The Dispute resolution committee shall be held in person, or by means of telephone, electronic or other communications facilities that permit the parties to communicate with each other during the meeting, within 10 days after such referral to attempt in good faith to resolve such dispute.

In the event the Dispute cannot be resolved by the Dispute resolution committee, then the parties agree that the Dispute will be finally resolved by binding arbitration administered by the London Court of International Arbitration, in accordance with the LCIA Rules, by three (3) arbitrators (with each party selecting one (1) arbitrator and the selected arbitrators choosing the third), with the seat of the arbitration in London, England and English as the language of arbitration. The parties shall keep all proceedings, findings and awards of the arbitration confidential. 

The Equipment Supply Agreement will include typical and appropriate provisions found in an equipment supply and technical support agreement of this type, including in relation to the following non-exclusive list:

A.     confidentiality;

B.      reporting, including periodic progress reports to the Purchaser of progress on construction of the Typhoon™ units;

C.     delivery of O&M manuals;

D.     severability; and

E.     anti-bribery or corrupt practices and general compliance with applicable law.