Black Economic Empowerment

In October 2002, the South African Government introduced a Broad-Based Black Economic Empowerment (BEE) policy to addressing past economic imbalance and to stimulate growth and employment. The policy is applied to the mining industry.

On March 5, 2008, the Company announced a formal joint venture partnership with well-established South African BEE group Nozala Investments (Pty) Ltd. This partnership is anticipated to be initially reflected in two Diamcor South African subsidiaries, DMI Minerals South Africa (Pty) Ltd and Jagersfontein Diamond Mining Company (Pty) Ltd., both of which were initially formed to secure diamond mining projects in South Africa. Under the terms of the joint venture, Diamcor retain a 70% direct ownership in the DMI Minerals subsidiary, with Nozala acquiring a 30% direct shareholder ownership interest. Operationally, expenses charged to the development of projects held by the entity, and the revenues generated, will be similarly proportional. A similar arrangement is also expected to be implemented in the Company's Jagersfontein Diamond Mining Company (Pty) Ltd. subsidiary in the future as suitable projects materialize. The Company considers these joint ventures a significant achievement because not only is Nozala a respected and established BEE group representing the interests of some estimated 500,000 rural women shareholders, but it is also a well-connected corporate entity in the South African business community, both of which will greatly enhance the Company's ability to achieve its stated growth objectives of securing long term, high profile projects within South Africa.