Option And Joint Venture Agreement (english Trans)

CERTIFICATE OF TRANSLATION


I, Louis O. Peloquin, Vice President, General Counsel and Secretary of Golden Star Resources Ltd. (the "Company") declare to the best of my knowledge that the attached is an accurate English translation of the Option and Joint Venture Agreement dated June 26, 1996 between Societe de Travaux Publics et de Mines Aurifiere en Guyane, Societe Guyanaise des Mines (collectively "SOTRAPMAG"), a 100% owned subsidiary of Guyanor Ressources S.A., LaSource Developpement, SAS and ASARCO Exploration Company.


/s/ Louis O. Peloquin
----------------------
Louis O. Peloquin
Vice President, General
Counsel and Secretary


State of Colorado ) County of Denver ) ss.


Subscribed and sworn to before me this 12th day of March, 1997 by Louis O. Peloquin.


/s/ Nathalie Defferard
-----------------------
Notary Public


My Commission Expires: October 25, 1999. 2
PAUL ISNARD OPTION AND JOINT VENTURE AGREEMENT


AMONG


SOTRAPMAG


AND


ASARCO EXPLORATION COMPANY


AND


LA SOURCE DEVELOPPEMENT


1 3 THIS AGREEMENT IS MADE AMONG:


SOCIETE DE TRAVAUX PUBLICS ET DE MINES AURIFERES EN GUYANE ("SOTRAPMAG"), a societe a responsabilite limitee, with capital of F2,000,000 and registered office at Aerodrome de Saint-Laurent, Route de Saint-Maurice, 97320 Saint-Laurent du Maroni, French Guiana, a wholly owned subsidiary of GUYANOR RESSOURCES S.A., acting on its behalf and for its own account and for both on behalf of and for the account of:


SOCIETE GUYANAISE DES MINES ("SGM"), societe en nom collectif, with
capital of 1,000,000 FF and registered office at PK 9 Route de
Saint-Jean, 97320 Saint-Laurent du Maroni, French Guiana pursuant to
special power of attorney dated _____ ).


Herein represented by D.A. Fennell, President and CEO, Golden Star Resources, hereinafter individually referred to as "SOTRAPMAG" and "SGM" respectively and collectively referred to as "SOTRAPMAG"


AND:


ASARCO EXPLORATION COMPANY, a New York corporation acting on its behalf and for its own account as well as on behalf of and for the account of:


ASARCO GUYANE FRANCAISE, a societe a responsabilite limitee with a
capital of 50,000 FF and registered office at PK 7 Route de Montjoly,
97343 Cayenne, French Guiana, a wholly owned subsidiary of Asarco
Exploration Company Inc. pursuant to a special power of attorney
dated N/A.


herein represented by G.D. Van Voorhis, President, hereinafter individually referred to as "ASARCO" and "ASARCO GUYANE" respectively and collectively referred to as "ASARCO"


AND:


LA SOURCE DEVELOPPEMENT SAS, a societe anonyme simplifiee, with capital of 250,000 francs and registered office at 16/18 avenue George V, 75008 Paris, France pursuant to a special power of attorney dated ______________


herein represented by _______________ , and hereinafter referred to as "LA SOURCE".


WITNESSETH:


Whereas by agreement dated March 25, 1994 SOTRAPMAG obtained from Alcatel Alsthom Compagnie Generale d'Electricite the title and exclusive rights to eight (8) concessions in the Paul Isnard area of Guyane, a Departement of France ("French Guiana"), subject to the grant of necessary administrative authorizations to the transfer on or before December 31, 1995;


Whereas by a decree dated December 27, 1995 published in the Journal Officiel of December 29, 1995, the French Minister of Industry, Post and Telecommunications approved the transfer of the Paul Isnard Concessions;


2 4 Whereas the concessions transferred to SOTRAPMAG were subject to option rights held by the BUREAU DE RECHERCHES GEOLOGIQUES ET MINIERES, BP 6009, Avenue Claude Guillemin, 45060 Orleans, France ("BRGM") which by an agreement between BRGM and GUYANOR RESSOURCES S.A. ("GUYANOR") dated September 26, 1994 were automatically converted, upon the grant of necessary administrative authorizations to transfer, into a 25% interest in the exploration and exploitation rights in any primary deposits located within the concessions;


Whereas SOTRAPMAG also holds, directly or indirectly, four Type "B" exploration permits in the Paul Isnard area and GUYANOR has under application one Type "A" exploration permit in this area, and SOTRAPMAG has agreed to extend BRGM's 25% interest to include the four Type "B" and, if granted, the one Type "A" exploration permits;


Whereas BRGM, pursuant to the terms of the agreement between BRGM and GUYANOR, has assigned its rights to the concessions and permits to LA SOURCE, of which a significant part of the share capital is held by BRGM;


Whereas SOTRAPMAG and LA SOURCE have agreed to organize two joint ventures ("societes en participation") one to explore the Paul Isnard Concessions and the other the Eau Blanche Permits and to jointly develop and mine any Primary Deposits found therein;


Whereas SOTRAPMAG has agreed to grant ASARCO two separate options to earn interests equal to 50% of SOTRAPMAG's interests in each joint venture (which is equivalent as of the date hereof to a 37.5% interest in each such joint venture organized pursuant to this Agreement) by preparing a feasibility study on the Property or any part thereof of such Joint Venture and by funding SOTRAPMAG's portion of the initial expenditures on Operations to be undertaken by such joint venture on all or part of such Property;


Whereas ASARCO shall also have, under the conditions set forth below, the option, once the First Feasibility Study has been delivered, to merge the Paul-Isnard and the Eau Blanche Properties into one joint venture.


NOW, THEREFORE, the parties have agreed, under certain conditions, to enter into this joint venture agreement which shall define the terms and conditions of their cooperation as participants in the joint ventures established by this Agreement and the terms on which ASARCO will earn its interest(s) and be vested as a participant in the joint venture(s).


NOW THEREFORE, IT IS AGREED AS FOLLOWS:


1. DEFINITIONS


The following terms are used in this agreement as defined below:


1.1 "Accounting Procedure" means the procedures set forth in Exhibit II.


1.2 "Adopted Program and Budget" means any Program and its corresponding
Budget adopted or approved by the Management Committee according to the
procedure described in Articles 8.3 and 8.4.


3 5 1.3 "Affiliate" of a Participant means (i) any person who, directly or
indirectly, controls, is controlled by, or is under common control with,
one of the Participants. The control concept includes control of the de
facto or de jure management or direction by holding equity securities or
by contract. "Control" may exist without possession of 50% or more of
its voting rights or capital stock provided always that direct or
indirect ownership of fifty percent (50%) or more of such voting rights
or capital stock gives rise to a presumption of control; (ii) any
Subsidiary.


1.4 "Agreement" means this agreement and all Exhibits thereto and future
addenda hereto and amendments hereof.


1.5 "Alluvial Deposit" means an unconsolidated deposit of ores, minerals or
mineral resources located at or near the surface formed where the
concentration of ore minerals was caused by the physical or mechanical
separation of heavier from lighter weight minerals during the surficial
flow of running water in stream channels.


1.6 "Area of Interest" means the Property and all land part or all of which
is located within ten kilometres of any point on the surrounding
outermost boundary of the Property described in Exhibit I. The part of
the Property to the East of a Northsouth line drawn along the Eastern
boundary of the Paul Isnard Concessions (which line is shown on the map
that forms part of Exhibit I) shall be included as part of the Eau
Blanche Permits and the property to the West of such line shall be
included as part of the Paul Isnard Concessions.


1.7 "ASARCO'S Exploration Expenditure Requirement" means the funds required
to be contributed by ASARCO under Article 7 through SOTRAPMAG to conduct
Operations enabling ASARCO to earn a Participating Interest equal to 50%
of SOTRAPMAG's Participating Interest in either Property or in both.


1.8 "Assets" means the Properties and all the Facilities, Products, land and
other assets and rights conveyed or assigned to or placed at the disposal
of either of the Joint Ventures by the Participants and all the other
Facilities and assets and rights acquired by the Manager or the
Participants on behalf and for account of either of the Joint Ventures
and all data and information resulting from the conduct of Operations and
the proceeds of disposition of any of the foregoing.


1.9 "BRGM Agreement" means that agreement dated September 26, 1994 between
GUYANOR and BRGM.


1.10 "Budget" means a detailed estimate of all the probable Expenditures to be
entailed by the Operations to complete a Program, supplemented, if need
be, by a timetable of cash advances to be made.


1.11 "Development" means all the work preparatory to extraction and recovery
of the Products from Primary Deposits, including construction or
installation of a treatment plant or any other Facility for extraction,
transport or treatment of the Products by any process.


1.12 "Effective Date" means the date of execution of this Agreement.


1.13 "Expenditures" means all of the costs, disbursements, debts and expenses,
calculated according to the accounting procedure described in Exhibit II
hereto, incurred in relation to Operations carried out under the
Agreement on any account.


4 6 1.14 "Exploration" means all the activities directed toward ascertaining the
existence, location, quantity, quality or commercial value of Primary
Deposits including completing any Feasibility Study and including any
costs for the maintenance of the applicable Mining Titles.


1.15 "Facility" means any equipment, machine, capital asset or other tangible
or other asset.


1.16 "Feasibility Study" means a report and the work required to prepare such
report for either of the Joint Ventures in respect of a Primary Deposit
(including the First Feasibility Study) as described in Exhibit III
hereto which recommends the Development and Exploitation of a Primary
Deposit on the basis that it has a positive net present value using a
reasonable discount rate and includes such information and is in such
form as is generally required to secure all construction and mining
permits necessary for the Mining of a Primary Deposit and to obtain a
project loan on reasonable terms from a major lending institution to
develop Mining Operations on the Primary Deposit that is the subject of
the reports.


1.17 "First Feasibility Study" means the First of the Initial Feasibility
Studies whereby ASARCO may decide to vest in one of the Properties and
has the option to combine the Properties into one Joint Venture.


1.18 "Initial Feasibility Study" means a Feasibility Study prepared for either
of the Joint Ventures in respect of a Primary Deposit on either the Paul
Isnard Concessions or the Eau Blanche Permits which reaches one of the
following conclusions:


(a) if made during the first and second years after the Effective
Date, it concludes to the existence of at least five million
ounces of minable gold;


(b) if made during the third and fourth years after the Effective
Date, it concludes to the existence of at least two million ounces
of minable gold; and


(c) if made during the fifth year after the Effective Date, it
concludes to the existence of at least one million ounces of
minable gold.


1.19 "Initial Participating Interest" means the interests of each Participant
set forth in Article 6.6.


1.20 "Initial Period" means the period beginning with the Effective Date and
ending on the earlier of the date ASARCO earns its Participating Interest
or the date its option terminates without ASARCO having earned its
Participating Interest.


1.21 "Joint Venture" means either of the joint ventures established by this
Agreement and all the rights, obligations and other relations relating to
a Property between the Participants in such joint venture pursuant to
this Agreement.


1.22 "Joint Account" means any account or accounts opened in accordance with
the Accounting Procedure set forth in Exhibit II hereto.


1.23 "Eau Blanche Permits" means the four Type "B" permits and, if and when
granted, the one Type "A" permit currently under application, all as more
particularly described in Exhibit I hereto.


5 7 1.24 "Management Committee" means the committee provided for in Article 8.


1.25 "Manager" means the natural person or legal entity designated pursuant to
Article 9 to manage Operations or any successor Manager.


1.26 "Mining" means extraction, production, transport, treatment or other
processing of Products from Primary Deposits and includes marketing of
Products.


1.27 "Mining Titles" means each of the individual titles to the Paul Isnard
Concessions and the Eau Blanche Permits and "Mining Title" means any one
of them.


1.28 "Net Proceeds" means the amount calculated in the manner described in
Exhibit IV.


1.29 "Operation" means any Exploration, Development or Mining and other
activities and their administration carried out in respect of a Property.


1.30 "Participant" means a natural person or legal entity who from time to
time holds a Participating Interest in either of the Joint Ventures.


1.31 "Participating Interest" means the undivided portion or share of a
Participant of the aggregate ownership interest in either of the Joint
Ventures and its assets expressed as a percentage. A Participating
Interest shall be calculated as a percentage to three decimal places and
rounded to two, e.g. 30.519% rounded to 30.52%. Decimals of .005 or
more shall be rounded up to .01 and decimals of less than .005 shall be
rounded down.


1.32 "Parties" means collectively SOTRAPMAG, SGM, ASARCO, ASARCO GUYANE and LA
SOURCE, and their representatives, successors and assigns.


1.33 "Paul lsnard Concessions" means the eight concessions in the Paul Isnard
area more particularly identifed and described in Exhibit I.


1.34 "Primary Deposit" means a deposit of ores, minerals or mineral resources
which is not an Alluvial Deposit.


1.35 "Products" means all metals, ores, minerals, concentrates and other
mineral resources produced from the land covered by the Property.


1.36 "Program" means the description in writing and in reasonable detail of
the Operations to be conducted and objectives to be accomplished on any
of the Properties by a Manager for a six month period or any longer
period.


1.37 "Property" means either of the Paul Isnard Concessions or the Eau Blanche
Permits, as the context requires, except that if an election is made
pursuant to Article 7.3 to combine the Paul Isnard Concessions and the
Eau Blanche Permits then the "Property" means the Paul Isnard Concessions
and the Eau Blanche Permits.


6 8 1.38 Any legal entity is deemed to be another's "Subsidiary" if:


(a) it is directly or indirectly controlled by the other entity; or


(b) it is the Subsidiary of a Subsidiary of such other entity.


A legal entity is presumed to be another's Subsidiary if the latter:


(c) directly or indirectly holds 50% of its capital stock or voting
rights;


(d) directly or indirectly controls its management de facto or de
jure; or is entitled to elect or appoint its executives.


1.39 "$" and "dollars" means dollar in the currency of the United States of
America unless otherwise stated.


2. PURPOSES


2.1 PURPOSES. The sole purpose of this Agreement is to (i) create two Joint
Ventures, one covering the Paul-Isnard Property, and the other covering
the Eau Blanche Property, (ii) set forth the terms under which
Exploration, Development and Mining Operations shall be conducted in
respect of the Paul-Isnard and Eau Blanche Properties or any additional
properties acquired within the Area of Interest by the said Joint
Ventures and to perform any other activity necessary, appropriate or
incidental to any of the foregoing and (iii) set forth the terms upon
which ASARCO shall earn a Participating Interest in either or both of
said Joint Ventures.


2.2 LIMITED PURPOSES. Unless the Participants expressly agree otherwise, the
only purpose of this Agreement is the attainment of the objectives in
Article 2.1 above and nothing herein below shall be construed as
extending the same.


3. TERM


3.1 TERM. The term of this Agreement shall be for an unlimited period.


4. CONTRIBUTIONS


4.1 ASSETS TO BE PLACED AT THE DISPOSAL OF THE JOINT VENTURE. SOTRAPMAG
shall place, upon execution of this Agreement, the Paul Isnard
Concessions and the Eau Blanche Permits and all geological data relating
thereto to which it has rights at the exclusive disposal of the
applicable Joint Venture, for Exploration, Development and Mining, in
accordance with the provisions hereof. As of the date hereof, SOTRAPMAG
warrants and represents, except as disclosed in Exhibit I hereto, that
each of the Mining Titles and all of the geological data are held by
SOTRAPMAG (with the exception of the Type "A" permit which GUYANOR has
under application) and that such rights are free from all claims and
encumbrances or any other interests of a third party of any nature
whatsoever which might have a material adverse effect on the rights of
the Parties hereunder and that the Property is in good standing under the
applicable laws and regulations. So long as either of the Joint Ventures
remains in existence SOTRAPMAG agrees not to transfer all or part of the
Mining Titles placed at the disposal of that Joint Venture without the
prior written consent of all of the Participants in such Joint Venture.
In the event of


7 9
withdrawal from either of the Joint Ventures by SOTRAPMAG, SOTRAPMAG
agrees to take all steps necessary to transfer all or part of the Mining
Titles relating to such Joint Venture to the remaining Participants at
the request of such Participants.


Subject to the provisions of Article 12 below:


(a) SOTRAPMAG shall retain legal title to the Paul Isnard Concessions
and the Eau Blanche Permits for the benefit of the applicable
Joint Venture and nothing in this Agreement shall be construed as
a conveyance or transfer of any of the Mining Titles to such Joint
Venture or anyone else;


(b) During the term of this Agreement each Joint Venture shall have
the exclusive right to conduct Exploration, Development and Mining
Operations on or in respect of Primary Deposits on its Properties,
it being understood however that the Exploration, Development and
Mining rights may in relation to a specific Primary Deposit be
transferred in whole or in part as provided in Article 12.


4.2 FINANCING. Subject only to Articles 4.3 and 4.4, the Participants shall
contribute to the financing of Exploration by contributing to the Adopted
Program and Budget which has been adopted by a Joint Venture in
proportion to their Participating Interests in such Joint Venture. Once
the decision to commence Development and Mining in respect either of the
Properties is taken in accordance with Article 12.2, financing of the
Development and Mining shall be undertaken as described in Articles 7 and
12.


4.3 INITIAL SOTRAPMAG CONTRIBUTION. Prior to proportional contribution for
Operations by LA SOURCE in accordance with its Participating Interest,
SOTRAPMAG shall first have contributed one million United States dollars
(U.S.$1,000,000) to the financing of the Adopted Programs and Budgets on
either or both of the Joint Ventures. LA SOURCE acknowledges that said
first U.S.$1,000,000 will be paid by SOTRAPMAG by way of the
contributions of ASARCO under Article 7 towards earning 50% of
SOTRAPMAG's Participating Interest as of the date of exercise of ASARCO's
option, in either of the Joint Ventures. Thus, for example, once
SOTRAPMAG has contributed or shall be deemed to have contributed through
ASARCO $400,000 to the Paul-Isnard Joint Venture and $600,000 to the Eau
Blanche Joint Venture, it shall have fulfilled its obligation under the
terms of this Article.


4.4 PROPORTIONAL CONTRIBUTIONS. ASARCO's right and obligation to make
proportional contributions that are required by either Joint Venture
directly, and not indirectly through SOTRAPMAG, for such Joint Venture's
Operations will begin after it has earned a Participating Interest equal
to 50% of SOTRAPMAG's Participating Interest as of the date of exercise
of ASARCO's option, in this Joint Venture through SOTRAPMAG as provided
under Article 7 unless SOTRAPMAG has withdrawn from such Joint Venture
prior to ASARCO's having earned its interest in such Joint Venture in
which case (a) ASARCO shall have the option to immediately vest in a
Participating Interest equal to 50% of SOTRAPMAG's Participating
Interest, and (b) the remaining 50% of SOTRAPMAG's Participating Interest
shall be transferred to ASARCO and LA SOURCE pursuant to Article 13.1.
Unless the Participating Interests have been adjusted in accordance with
the terms of this Agreement, LA SOURCE shall contribute 25% of the costs
of Operations after SOTRAPMAG shall have first contributed U.S.$1,000,000
as aforesaid and the


8 10
contributions made by ASARCO pursuant to Article 7 to earn its
Participating Interest will, until ASARCO has earned its Participating
Interest, constitute the 75% percent contribution due from SOTRAPMAG.


5. OPERATIONS


5.1 TWO PHASES. The Operations under this Agreement shall be undertaken in
two phases. The initial phase shall consist of carrying out by each
Joint Venture of Exploration Operations as described in Articles 6
through 11 including the completion of an Initial Feasibility Study for
prospective Primary Deposits found on all or part of the Property of such
Joint Venture.


In the event a decision is taken by the Management Committee to proceed
to the Development of a Mine, the second phase shall consist of the
Mining of the Primary Deposits on the Property, according to the
conditions set out in Article 12.


5.2 PARALLEL OPERATIONS. It is understood by the Parties that the different
phases of Exploration, Development and Mining may be carried out in
parallel on the Paul Isnard Concessions and the Eau Blanche Permits, with
the Development and Mining of a Primary Deposit being started by a Joint
Venture while Exploration by the Joint Venture continues for the
discovery of other Primary Deposits on the same Property or for the
purpose of increasing the reserves of active Primary Deposits.


EXPLORATION PHASE


6. RELATIONS AMONG THE PARTIES AND THEIR PARTICIPATING INTERESTS


6.1 CREATION OF SOCIETES EN PARTICIPATION. For the purpose of the carrying
out of the Operations in respect of the Paul Isnard Concessions, the
Participants hereby establish a societe en participation bearing the name
"Syndical Paul Isnard" governed by Articles 1871 and 1873 of the French
Civil Code and by this Agreement. A societe en participation bearing the
name "Syndical Eau Blanche", governed by Articles 1871 and 1873 of the
French Civil Code and by this Agreement, is also established by the
Participants in order to carry out the Operations in respect of the Eau
Blanche Permits. Each Participant shall be responsible only for its own
obligations as herein set out and shall be liable only for its share of
the costs and expenses as provided herein. None of the Participants
shall have any authority to act for or to assume any obligation or
responsibility on behalf of any other Participant or to bind another
Participant, with the exceptions of the powers attributed to the Manager
under the terms of this Agreement. The rights, duties, obligations, and
liabilities of the Participants shall be several and not joint or
collective. Each Participant shall indemnify, defend, and hold harmless
the other Participants, their directors, officers, and employees from and
against any and all losses, claims, damages and liabilities arising out
of any act or any assumption of liability (except if undertaken or
assumed pursuant to the authority expressly granted herein or otherwise
agreed in writing between the Participants) by the indemnifying
Participant or any of its directors, officers, or employees, done or
undertaken, or apparently done or undertaken, on behalf of the other
Participants, with the exception of the prerogatives granted to the
Manager if exercised in the context of his mandate.


6.2 NO PARTNERSHIP. The Participants agree that it is not their intent to
create a partnership, and nothing contained in this Agreement ...