EX-99 17 ex4_114.htm
Exhibit 4.114
CLASS C PREFERENCE SHARE SUBSCRIPTION
AGREEMENT
between
THE TRUSTEES FOR THE TIME BEING OF THE DRDSA EMPOWERMENT
TRUST
and
BLYVOORUITZICHT GOLD MINING COMPANY LIMITED
TABLE OF CONTENTS
1 INTERPRETATION ..........................................................................
3
2 RECORDALS ..................................................................................
6
3 SUSPENSIVE CONDITIONS ..........................................................
7
4 SUBSCRIPTION ALLOTMENT AND ISSUE....................................
8
5
RIGHTS, PRIVILEGES AND RESTRICTIONS ATTACHING TO
THE CLASS C PREF SHARE............................................................
8
6 BREACH...........................................................................................
8
7 GENERAL
WARRANTIES...............................................................
9
8 CO-OPERATION ............................................................................
10
9 PUBLICITY.......................................................................................
10
10 DISPUTE
RESOLUTION................................................................
11
11 BENEFIT OF THE AGREEMENT.................................................
12
12 NOTICES
AND
DOMICILIA...............................................................
12
13 GENERAL.....................................................................................
14
14 APPLICABLE
LAW
AND
JURISDICTION ...........................................
15
15 COSTS ........................................................................................
15
16 SIGNATURE.................................................................................
15
ANNEXES
ANNEXE "A"
RIGHTS, PRIVILEGES AND RESTRICTIONS OF THE CLASS C
CUMULATIVE PARTICIPATING PREFERENCE SHARE
WHEREBY THE PARTIES AGREE AS FOLLOWS -
1 INTERPRETATION
1.1 In this Agreement-
1.1.1
clause headings are for convenience only and re not to be used I its
interpretation;
1.1.2
an expression which denotes -
1.1.2.1
any gender includes the other genders;
1.1.2.2
a natural person includes a juristic person and
vice versa;
and
1.1.2.3
the singular includes the plural and
vice versa.
1.2
In this Agreement, unless the context clearly indicates a contrary intention, the
following words and expressions shall bear the meanings assigned to them
below and cognate words and expressions shall bear corresponding meanings -
1.2.1
"Act" means the Companies Act, 1973;
1.2.2
"AFSA" means the Arbitration Foundation of Southern Africa;
1.2.3 "Agreement" means this Class C Preference Share Subscription
Agreement;
1.2.4
"Class C Pref Share" means a Class C cumulative participating preference
share in the share capital of the Company with a par value of R1.00 (one
rand), and having the rights, privileges and restrictions contained in annexe
"A";
1.2.5
"Closing Date" means the 1
5
' (first) business day after the date upon
which the last of the Suspensive Conditions has been fulfilled or waived, as
the case may be;
1.2.6
"Company" means Blyvooruitzicht Gold Mining Company Limited,
registration number 1937/009743/06, a limited liability public company duly
incorporated in the Republic of South Africa;
1.2.7
"DRDSA" means DRDGOLD South African Operations (Proprietary)
Limited, registration number 2005/033662/07, a limited liability private
company duly incorporated in the Republic of South Africa;
1.2.8
"Khumo Gold SPV" means Khumo Gold SPV (Proprietary) Limited,
registration number 2005/029595/07, a limited liability private company duly
incorporated in the Republic of South Africa;
1.2.9
"DRDGOLD"
means DRDGOLD Limited, registration number
1895/000926/06, a limited liability public company duly incorporated in the
Republic of South Africa;
1.2.10
"Nominated Attorneys" means Cliffe Dekker Incorporated, registration
number 1998/018173/21, a firm of attorneys incorporated as a private
company in the Republic of South Africa in accordance with section 53(b) of
the Act;
1.2.11
"Parties" means the parties to this Agreement;
1.2.12
"Signature Date" means the date of signature of this Agreement by the
Party last signing;
1.2.13
"Subscription Price" means the amount of R1,535,400.00 (one million
five hundred and thirty five thousand four hundred rand);
1.2.14
"Suspensive Conditions" means the suspensive conditions contained in
clause 3.1;
1.2.15 "Trust" means the DRDSA Empowerment Trust, an inter vivos trust
established by oral agreement between Khumo Gold SPV, Masecheaba
Palesa Moletsane Ncholo and Mervin Percival Thulo Mogotsi on 07
September 2006; and
1.2.16
"Trust Loan Agreement" means the Loan Agreement entered into or to be
entered into between DRDGOLD and the Trust contemporaneously with the
entering into of this Agreement, and in terms of which DRDGOLD will lend and
advance to the Trust an amount of R14,128,800.00 (fourteen million one
hundred and twenty eight thousand eight hundred rand).
1.3
Any substantive provision, conferring rights or imposing obligations on a Party
and appearing in any of the definitions in this clause 1 or elsewhere in this
Agreement, shall be given effect to as if it were a substantive provision in the
body of the Agreement.
1.4
Words and expressions defined in any clause will, unless the application of
any such word or expression is specifically limited to that clause, bear the
meaning assigned to such word or expression throughout this Agreement.
1.5
Subject to the provisions of clauses 1.6 and 1.11, defined terms appearing
in this Agreement in title case will be given their meaning as defined, while
the same terms appearing in lower case will be interpreted in accordance
with their plain English meaning.
1.6
A reference to any statutory enactment will be construed as a
reference
to
that enactment as at the Signature Date and as amended or substituted from
time to time.
1.7
Reference to "days" will be construed as calendar days unless qualified by
the word "business", in which instance a "business day" will be any day other
than a Saturday, Sunday or public holiday as gazetted by the government of the
Republic of South Africa from time to time. Any reference to "business hours"
shall be construed as being the hours between 08h30 and 17h00 on any
business day. Any reference to time shall be based upon Central African Time.
1.8
Unless specifically otherwise provided, any number of days prescribed will be
determined by excluding the first and including the last day or, where the last
day falls on a day that is not a business day, the next succeeding business day.
1.9
Where figures are referred to in numerals and in words, and there is any conflict
between the two, the words will prevail, unless the context indicates a contrary
intention.
1.10
No provision herein will be construed against or interpreted to the disadvantage
of a Party by reason of such Party having or being deemed to have structured,
drafted or introduced such provision.
1.11
in this Agreement the words "clause" or "clauses" refer to clauses of this
Agreement.
2
RECORDALS
2.1
In terms of the Trust Loan Agreement, DRDGOLD will lend and advance an
amount of R14,128,800.00 (fourteen million one hundred and twenty eight
thousand eight hundred rand) to the Trust, on condition, inter alia, that the Trust
applies the proceeds of the said subscription to subscribe for inter alia the Class
C Pref Share.
2.2
The Trust has agreed to subscribe for, and the Company has agreed to allot
and issue to the Trust, the Class C Pref Share upon the terms and conditions
contained in this Agreement.
2.3
The Parties wish to record in writing their agreement in respect of the
above and matters ancillary thereto.
3
SUSPENSIVE CONDITIONS
3.1
This Agreement, save for the provisions of clause 1, this clause 3, and clauses 6
to 16 which will become effective immediately, shall be subject to the suspensive
conditions that, by no later than 30 November 2006 –
3.1.1
the Trust Loan Agreement has been entered into and has become
unconditional in accordance with its terms, save in respect of any condition
requiring that this Agreement becomes unconditional; and
3.1.2
all such resolutions have been passed by the shareholders and directors of
the Company and, where required, registered by the Registrar of Companies,
as may be necessary in order to approve and implement the provisions of this
Agreement.
3.2
The Suspensive Conditions have been inserted for the benefit of both Parties
and may therefore only be waived by agreement in writing between the Parties.
3.3
Each of the Parties will use commercially reasonable endeavours and the
Parties will co-operate in good faith to procure the fulfilment of the Suspensive
Conditions as soon as reasonably possible after the Signature Date.
3.4
Unless all the Suspensive Conditions have been fulfilled or waived by not later
than the date specified for fulfilment thereof set out above (or such later date or
dates as may be agreed in writing between the Parties) the provisions of this
Agreement, save for the provisions of clause 1, this clause 3, and clauses 6 to
16 which will become effective immediately, will never become of any force or
effect and the status quo ante will be restored as near as may be and neither of
the Parties will have any claim against the other in terms hereof or arising from
the failure of the Suspensive Conditions, save for any claims arising from a
breach of the provisions of clause 3.3.
4
SUBSCRIPTION, ALLOTMENT AND ISSUE
4.1
The Trust hereby, but with effect from the Closing Date, subscribes for the
Class C Pref Share at the Subscription Price.
4.2
The Trust shall pay the Subscription Price on the Closing Date in cash by
causing the Nominated Attorneys to electronically transfer such portion of the
subscription price payable by DRDGOLD to the Nominated Attorneys in trust in
terms of the Trust Loan Agreement as is equal to the Subscription Price, into
such banking account as the Company may notify the Nominated Attorneys in
writing.
4.3
On the Closing Date, against compliance by the Trust with the obligation to
pay the Subscription Price, the Company shall allot and issue the Class C
Pref Share and shall deliver the share certificate in respect thereof to the
Trust.
4.4
The creation duty payable on the creation of the Class C Pref Share shall
be borne and paid by the Company.
5
RIGHTS, PRIVILEGES AND RESTRICTIONS ATTACHING TO THE CLASS
C PREF SHARE
The Class C Pref Share shall have the rights, privileges and restrictions set out
in annexe "A".
6
BREACH
6.1
If, before the completion of the allotment and issue of the Class C Pref Share,
either Party commits a breach of its obligations under this Agreement, and if the
breach in question is not remedied before the expiry of a period of 48 (forty
eight) hours after the aggrieved Party has given notice to the other Party to
remedy same, the aggrieved party shall be entitled to cancel this Agreement on
written notice to the other Party.
6.2
The Parties agree that after the subscription by the Trust for, and the allotment
and issue by the Company of, the Class C Pref Share in terms of this
Agreement, the cancellation of this Agreement in the event of a breach would be
an inappropriate and insufficient remedy and that irreparable damage would
occur if the provisions of this Agreement were not complied with. It is accordingly
agreed that, in the event of a breach, the aggrieved Party shall be entitled
(without prejudice to any other rights which it may have in law save for the right
to cancel the Agreement) to an order for specific performance and to recover any
damages which it may have suffered.
6.3
Subject to the provisions of clause 6.2, this Agreement and the Trust Loan
Agreement form part of one indivisible transaction. Should either this Agreement
or the Trust Loan Agreement be terminated for any reason whatsoever, the other
of them shall terminate simultaneously.
7
GENERAL WARRANTIES
Each of the Parties hereby warrants to and in favour of the other that —
7.1
it has the legal capacity and has taken all necessary corporate action
required to empower and authorise it to enter into this Agreement; and
7.2
this Agreement constitutes an agreement valid and binding on it and
enforceable against it in accordance with its terms.
8 CO-OPERATION
8.1
The Parties undertake at all times to co-operate with each other in good faith in
order to carry out this Agreement and to implement all transactions and steps
contemplated herein. The Parties further undertake not to take any action or to
omit taking any action which will result in delaying or impeding the
implementation of this Agreement.
9
PUBLICITY
9.1
Subject to the provisions of clause 9.3, each Party undertakes to keep
confidential and not to disclose to any third party, save as may be required in law
(including by the rules of any recognised securities exchange) or permitted in
terms of this Agreement, the nature, content or existence of this Agreement and
any and all information given by a Party to the other Party pursuant to this
Agreement.
9.2
No announcements of any nature whatsoever shall be made by or on behalf of a
Party relating to this Agreement without the prior consent of the other Party, save
for any announcement or other statement required to be made in terms of the
provisions of any law (or the rules of any recognised securities exchange) in
which event the Party obliged to make such statement shall first consult with the
other Party in order to enable them in good faith to attempt to agree the content
of such announcement, which (unless agreed) must go no further than is
required in terms of such law or rules. This shall not apply to a Party wishing to
respond to the other Party which has made an announcement of some nature in
breach of this clause 9.
9.3
The provisions of this clause 9 shall not apply to any disclosure made by a Party
to its professional advisors or consultants, provided that they have agreed to the
same confidentiality undertakings, or to any judicial or arbitral tribunal or officer,
in connection with any matter relating to this Agreement or arising out of it.
10
DISPUTE RESOLUTION
10.1
In the event of there being any dispute or difference between the Parties arising
out of this Agreement, or in connection with it, or regarding its interpretation,
validity, execution, implementation, termination or cancellation, the said dispute
or difference shall on written demand by either Party be submitted to arbitration
in Johannesburg in accordance with the AFSA rules for commercial arbitration.
10.2 Should AFSA, as an institution, not be operating at that time or not be accepting
requests for arbitration for any reason, then the arbitration shall be conducted in
accordance with the AFSA rules for commercial arbitration, but administered by
the attorneys of the Parties, before an arbitrator appointed by agreement
between the Parties or failing agreement within 10 (ten) business days of the
demand for arbitration, then either Party shall be entitled to forthwith call upon
the chairperson of the Johannesburg Bar Council to nominate the arbitrator,
provided that the person so nominated shall be an advocate of not less than 10
(ten) years standing as such. The person so nominated shall be accepted by and
appointed as the arbitrator by the Parties. In the event of the attorneys of the
Parties failing to agree on any matter relating to the administration of the
arbitration, such matter shall be referred to and decided by the arbitrator whose
decision shall be final and binding on the Parties.
10.3
Either Party may appeal the decision of the arbitrator or arbitrators in terms of the
AFSA rules for commercial arbitration.
10.4
Nothing herein contained shall be deemed to prevent or prohibit a Party from
applying to the appropriate court for urgent relief or for judgment in relation to a
liquidated claim.
10.5
Any arbitration in terms of this clause 10 shall be conducted in camera and the
Parties shall treat as confidential and not disclose to any third party details of the
dispute submitted to arbitration, the conduct of the arbitration proceedings or the
outcome of the arbitration, without the written consent of the other Party.
10.6 The provisions of this clause 10 will continue to be binding on the Parties
notwithstanding any termination or cancellation of the Agreement.
10.7
The Parties agree that the written demand by a Party in terms of clause 10.1 that
the dispute or difference be submitted to arbitration, is to be deemed to be a
legal process for the purpose of interrupting extinctive prescription in terms of the
Prescription Act, 1969.
11 BENEFIT OF THE AGREEMENT
This Agreement will be also for the benefit of and be binding upon the
successors in title and permitted assigns of the Parties or either of them.
12
NOTICES AND DOMICILIA
12.1
The Parties choose as their respective domicilia citandi et executandi for the
purpose of legal proceedings and for the purposes of giving or sending any
notice provided for or necessary in terms of this Agreement, the following
addresses and telefax numbers for each of them -
Name Physical Address
Telefax
Trust
The Birches
+27 (0)11 457 6901
Riverwoods Office Park
Johnson Road
Bedfordview
Marked for the attention of: Dr Paseka Ncholo
Name Physical Address
Telefax
Company
4 Ebsco House
+27 (0)11 482 4641
299 Pendoring Ave
Blackheath
Marked for the attention of: N Pretorius
provided that a Party may change its domicilium to any other physical address or telefax
number within the Republic of South Africa by written notice to the other Party to that
effect. Such change of address will be effective 5 (five) business days after receipt of the
notice of the change of domicilium.
12.2
All notices to be given in terms of this Agreement will be in writing and will -
12.2.1
be delivered by hand or sent by telefax;
12.2.2
if delivered by hand during business hours, be presumed to have been
received on the date of delivery. Any notice delivered after business hours or
on a day which is not a business day will be presumed to have been received
on the following business day; and
12.2.3
if sent by telefax during business hours, be presumed to have been received
on the date of successful transmission of the telefax. Any telefax sent after
business hours or on a day which is not a business day will be presumed to
have been received on the following business day.
12.3
Notwithstanding the above, any notice given in writing, and actually received
by the Party to whom the notice is addressed, will be deemed to have been
properly given and received, notwithstanding that such notice has not been
given in accordance with this clause.
12.4 The Parties record that whilst they may correspond via email during the
currency of this Agreement for operational reasons, no formal notice required in
terms of this Agreement, nor any amendment of or variation to this Agreement
may be given or concluded via email.
13
GENERAL
13.1
This Agreement constitutes the whole of the agreement between the Parties
relating to the matters dealt with herein and, save to the extent otherwise
provided herein, no undertaking, representation, term or condition relating to the
subject matter of this Agreement not incorporated in this Agreement will be
binding on either of the Parties.
13.2
No variation, addition, deletion, or agreed cancellation will be of any force or
effect unless in writing and signed by or on behalf of the Parties. Failure or delay
on the part of either Party in exercising any right, power or privilege hereunder
will not constitute or be deemed to be a waiver thereof, nor will any single or
partial exercise of any right, power or privilege preclude any other or further
exercise thereof or the exercise of any other right, power or privilege.
13.3
All provisions and the various clauses and sub-clauses of this Agreement are,
notwithstanding the manner in which they have been grouped together or linked
grammatically, severable from each other. Any provision, clause or sub-clause of
this Agreement which is or becomes unenforceable in any jurisdiction, whether
due to voidness, invalidity, illegality, unlawfulness or for any other reason
whatever, shall, in such jurisdiction only and only to the extent that it is so
unenforceable, be treated as pro non scripto and the remaining provisions,
clauses and sub-clauses of this Agreement shall remain of full force and effect.
13.4
Neither this Agreement nor any part, share or interest therein nor any rights or
obligations hereunder may be ceded, assigned, or otherwise transferred without
the prior written consent of the other Party.
13.5
This Agreement may be executed in one or more counterparts, each of which
will be deemed an original, and all of which together will constitute one and the
same agreement as at the date of signature of the Party last signing one of the
counterparts.
14
APPLICABLE LAW AND JURISDICTION
14.1
This Agreement will in all respects be governed by and construed under the laws
of the Republic of South Africa.
14.2
Subject to the provisions of clause 10, the Parties hereby consent and submit to
the non-exclusive jurisdiction of the Witwatersrand Local Division of the High
Court of the Republic of South Africa in any dispute arising from or in connection
with this Agreement. The Parties agree that any costs awarded will be
recoverable in accordance with the High Court tariff, determined on an attorney-
and-own-client scale.
15 COSTS
It is recorded that the fees and disbursements of the Nominated Attorneys of and
incidental to the negotiation, drafting, preparation and implementation of this
Agreement will be borne and paid by DRDSA. All further legal costs and
expenses of and incidental to the negotiation, drafting, preparation and
implementation of this Agreement will be paid by the Party incurring such costs.
16 SIGNATURE
Signed on behalf of the Parties as set out below, each signatory hereto
warranting that he or she has due authority to do so -
Signed at _______Bedfordview__________ on 24 October _______________ 2006.
For and on behalf of
THE TRUSTEES FOR THE TIME BEING
OF THE DRDSA EMPOWERMENT
TRUST
_______________________________
/s/ T Mogotsi
Trustee
,
SIGNED at __________________________on 30 November ______________2006.
For and on behalf of
BLYVOORUITZICHT GOLD MINING
COMPANY LIMITED
________________________________
Signature:
Name of Signatory:
/s/ LC Lamsley
Designation of Signatory: COO
TERMS AND CONDITIONS OF THE CLASS C CUMULATIVE
PARTICIPATING PREFERENCE SHARE
1
In this annexe "A", unless the context otherwise indicates, the following terms shall
have the meanings assigned to them hereunder -
1.1
"Act" means the Companies Act, 1973;
1.2
"Company" means Blyvooruitzicht Gold Mining Company Limited, registration
number 19371009743/06, a limited liability public company duly incorporated in the
Republic of South Africa;
1.3
"Class A Pref Share" means the existing Class A cumulative participating
preference share in the share capital of the Company with a par value of R1.00
(one rand);
1.4
"Class B Pref Share" means a Class B cumulative participating preference share
in the share capital of the Company with a par value of R1.00 (one rand);
1.5
"Class C Pref Share" means a Class C cumulative participating preference share
in the share capital of the Company with a par value of R1.00 (one rand), and
having the rights, privileges and restrictions contained in annexe "A";
1.6
"Dividend Date" means the last business day of each successive Dividend Period
on which date the Preference Dividend owing to the Holder is calculated and
becomes due and payable;
1.7
"Dividend Period" means successive periods of 3 (three) months each,
commencing on the 1st (first) day following the preceding Dividend Period and
ending on the last business day of each of December, March, June and September
in each year, provided that the 15t (first) Dividend Period will commence on the lst
(first) day following the Issue Date;
1.8
"DRDGOLD" means DRDGOLD Limited, registration number 1895/000926/06, a
limited liability public company duly incorporated in the Republic of South Africa;
1.9
"Holder" means the holder of the Class C Pref Share from time to time;
1.10
"Issue Date" means the actual date of issue of the Class C Pref Share;
1.11
"Preference Dividend" means the preferential cash dividend payable to the
Holder in accordance with the provisions of clause 3.1;
1.12
"Shareholder Loans" means the loans advanced by DRDGOLD to the
Company on loan account; and
1.13
"Subscription Price" means the amount of R1,535,400.00 (one million
five hundred and thirty five thousand four hundred rand).
2
The Class C Pref Share will be allotted and issued at par plus a premium in the
aggregate equal to the Subscription Price.
3
The Class C Pref Share will carry the following special rights and will be
subject to the following special conditions -
3.1
The Class C Pref Share carries the right in favour of the Holder to call for and
receive, after the payment of the preference dividend payable on the Class A Pref
Share, contemporaneously with the payment of the preference dividend payable on
the Class B Pref Share, but in priority to any dividend on any other class of shares
for the time being issued by the Company, a preferential dividend in an amount of
R0.06 (six cents) (less any Secondary Tax on Companies, or any other dividend
tax imposed in its stead which the Company becomes obliged to pay on every
dividend of R0.06 (six cents)) for every R0.74 (seventy four cents) that the
Company pays to DRDGOLD or its successor in title, both towards capital and
interest on capital in terms of the Shareholder Loans.
3.2
Each Preference Dividend shall accrue in favour of the Holder immediately upon
payment of any amount towards the Shareholder Loans and shall become payable
on the next Dividend Date.
3.3
The Class C Pref Share shall entitle the Holder to receive Preference Dividends
until the outstanding balance on the Shareholder Loans has been reduced to Nil.
3.4
On a winding-up of the Company or on any repayment of its capital, the Class C
Pref Share shall rank, in regard to all arrears of Preference Dividends (whether
declared or not) calculated to the date of the distribution or repayment, after the
Class A Pref Share, equally with the Class B Pref Share, but in priority to any other
shares for the time being issued by the Company.
3.5
The Class C Pref Share shall not be entitled to any further (in addition to what is
contained herein) participation in the profits or assets of the Company or, on its
winding-up, in the distribution of its surplus assets.
3.6
The Holder shall be entitled to receive notice of and be entitled to attend but not to
vote at any general meeting of the Company in respect of the Class C Pref Share
unless, any Preference Dividend remains in arrear and unpaid for a period of 7
(seven) days after a Dividend Date, or a resolution is to be proposed at the general
meeting
3.6.1
which directly or indirectly adversely affects the rights attached to the Class C
Pref Share or directly affects the interests of the Holder; or
3.6.2
for the disposal of the whole or substantially the whole of the undertaking of the
Company or the whole or the greater part of the assets of the Company, in
which event the Holder shall be entitled to vote on any such resolution.
3.7
The Holder shall, when it is entitled to vote and is present in person or is
represented by a representative or by a proxy at a general meeting, have -
3.7.1
one vote on a show of hands;
3.7.2
so many votes on a poll as is determined in accordance with section 195 of the
Act.
3.8
Notwithstanding anything to the contrary herein contained -
3.8.1
the terms of the Class C Pref Share may not be cancelled, varied or added to;
and
3.8.2
other than the existing Class A Pref Share and the Class B Pref Share,no
shares in the capital of the Company, ranking, as regards rights to dividends or,
on a winding-up or return of capital, in priority to or pari passe with the Class C
Pref Share shall be created or issued, without a special resolution of the
Company and without the consent in writing of the Holder.
3.9
A certificate issued by the auditors of the Company for the time being as to the
Preference Dividends due from time to time shall, unless and until the contrary is
proved, be binding on the Company and all its members.
3.10 The Company shall not be liable to the Holder for interest on any unclaimed
Preference Dividend. The Company shall retain all unclaimed monies until they are
claimed; provided that any amount remaining unclaimed for a period of 12 (twelve)
years shall be forfeited by the Holder to the Company.
CLASS C PREFERENCE SHARE SUBSCRIPTION
AGREEMENT
between
THE TRUSTEES FOR THE TIME BEING OF THE DRDSA EMPOWERMENT
TRUST
and
CROWN GOLD RECOVERIES (PROPRIETARY) LIMITED
TABLE OF CONTENTS
1 INTERPRETATION..............................................................................
3
2 RECORDALS.......................................................................................
6
3 SUSPENSIVE
CONDITIONS.................................................................
7
4 SUBSCRIPTION, ALLOTMENT AND ISSUE........................................
8
5
RIGHTS, PRIVILEGES AND RESTRICTIONS ATTACHING TO THE
CLASS C PREF SHARE ...................................................................
8
6 BREACH ..............................................................................................
8
7 GENERAL
WARRANTIES ....................................................................
9
8 CO-OPERATION ..................................................................................
10
9 PUBLICITY ............................................................................................
10
10 DISPUTE
RESOLUTION......................................................................
11
11 BENEFIT OF THE AGREEMENT........................................................
12
12 NOTICES
AND
DOMICILIA .....................................................................
12
13 GENERAL.............................................................................................
14
14 APPLICABLE LAW AND JURISDICTION............................................
15
15 COSTS.................................................................................................
15
16 SIGNATURE.........................................................................................
15
ANNEXES
ANNEXE "A" RIGHTS, PRIVILEGES AND RESTRICTIONS OF THE CLASS C
CUMULATIVE PARTICIPATING PREFERENCE SHARE
WHEREBY THE PARTIES AGREE AS FOLLOWS -
1 INTERPRETATION
1.1 In this Agreement-
1.1.1
clause headings are for convenience only and are not to be used in its
interpretation;
1.1.2
an expression which denotes -
1.1.2.1
any gender includes the other genders;
1.1.2.2
a natural person includes a juristic person and vice versa; and
1.1.2.3
the singular includes the plural and vice versa
1.2
In this Agreement, unless the context clearly indicates a contrary intention, the
following words and expressions shall bear the meanings assigned to them
below and cognate words and expressions shall bear corresponding meanings -
1.2.1 "Act" means the Companies Act, 1973;
1.2.2 "AFSA" means the Arbitration Foundation of Southern Africa;
1.2.3 "Agreement" means this Class C Preference Share Subscription Agreement;
1.2.4 "Class C Pref Share" means a Class C cumulative participating preference
share in the share capital of the Company with a par value of 81.00 (one rand),
and having the rights, privileges and restrictions contained in annexe "A";
1.2.5 "Closing Date" means the 1
s1
(first) business day after the date upon which the
last of the Suspensive Conditions has been fulfilled or waived, as the case may
be;
1.2.6 "Company" means Crown Gold Recoveries (Proprietary) Limited, registration
number 1988/0055115/07, a limited liability private company duly incorporated in
the Republic of South Africa;
1.2.7 "DRDGOLD" means DRDGOLD Limited, registration number 1895/000926/06, a
limited liability public company duly incorporated in the Republic of South Africa;
1.2.8 "DRDSA" means DRDGOLD South African Operations (Proprietary) Limited,
registration number 2005/033662/07, a limited liability private company duly
incorporated in the Republic of South Africa;
1.2.9 "Khumo Gold SPV" means Khumo Gold SPV (Proprietary) Limited, registration
number 2005/029595/07, a limited liability private company duly incorporated in
the Republic of South Africa;
1.2.10 "Nominated Attorneys" means Cliffe Dekker Incorporated, registration number
1998/018173/21, a firm of attorneys incorporated as a private company in the
Republic of South Africa in accordance with section 53(b) of the Act;
1.2.11 "Parties" means the parties to this Agreement;
1.2.12 "Signature Date" means the date of signature of this Agreement by the Party
last signing;
1.2.13 "Subscription Price" means the amount of R1,091,400.00 (one million ninety
one thousand four hundred rand);
1.2.14 "Suspensive Conditions" means the suspensive conditions contained in
clause 3.1;
1.2.15 "Trust" means the DRDSA Empowerment Trust, an inter vivos trust
established by oral agreement between Khumo Gold SPV, Masecheaba Palesa
Moletsane Ncholo and Mervin Percival Thulo Mogotsi on 07 September 2006;
and
1.2.16 Trust Loan Agreement" means the Loan Agreement entered into or to be
entered into between DRDGOLD and the Trust contemporaneously with the
entering into of this Agreement, and in terms of which DRDGOLD will lend and
advance to the Trust an amount of R14,128,800.00 (fourteen million one
hundred and twenty eight thousand eight hundred rand).
1.3
Any substantive provision, conferring rights or imposing obligations on a Party
and appearing in any of the definitions in this clause 1 or elsewhere in this
Agreement, shall be given effect to as if it were a substantive provision in the
body of the Agreement.
1.4
Words and expressions defined in any clause will, unless the application of any
such word or expression is specifically limited to that clause, bear the meaning
assigned to such word or expression throughout this Agreement.
1.5
Subject to the provisions of clauses 1.6 and 1.11, defined terms appearing in this
Agreement in title case will be given their meaning as defined, while the same
terms appearing in lower case will be interpreted in accordance with their plain
English meaning.
1.6
A reference to any statutory enactment will be construed as a reference to that
enactment as at the Signature Date and as amended or substituted from time to
time.
1.7
Reference to "days" will be construed as calendar days unless qualified by the
word "business", in which instance a "business day" will be any day other than a
Saturday, Sunday or public holiday as gazetted by the government of the
Republic of South Africa from time to time. Any reference to ''business hours"
shall be construed as being the hours between 08h30 and 17h00 on any
business day. Any reference to time shall be based upon Central African Time.
1.8
Unless specifically otherwise provided, any number of days prescribed will be
determined by excluding the first and including the last day or, where the last day
falls on a day that is not a business day, the next succeeding business day.
1.9
Where figures are referred to in numerals and in words, and there is any conflict
between the two, the words will prevail, unless the context indicates a contrary
intention.
1.10
No provision herein will be construed against or interpreted to the disadvantage
of a Party by reason of such Party having or being deemed to have structured,
drafted or introduced such provision.
1.11 In this Agreement the words "clause" or "clauses" refer to clauses of this
Agreement
2
RECORDALS
2.1
In terms of the Trust Loan Agreement, DRDGOLD will lend and advance an
amount of R14,128,800.00 (fourteen million one hundred and twenty eight
thousand eight hundred rand) to the Trust, on condition, inter elle, that the Trust
applies the proceeds of the said subscription to subscribe for inter elle the Class
C Pref Share.
2.2
The Trust has agreed to subscribe for, and the Company has agreed to allot and
issue to the Trust, the Class C Pref Share upon the terms and conditions
contained in this Agreement.
2.3
The Parties wish to record in writing their agreement in respect of the above and
matters ancillary thereto.
3 SUSPENSIVE
CONDITIONS
3.1
This Agreement, save for the provisions of clause 1, this clause 3, and clauses 6
to 16 which will become effective immediately, shall be subject to the suspensive
conditions that, by no later than 30 November 2006 –
3.1.1
the Trust Loan Agreement has been entered into and has become
unconditional in accordance with its terms, save in respect of any condition
requiring that this Agreement becomes unconditional; and
3.1.2
all such resolutions have been passed by the shareholders and directors of
the Company and, where required, registered by the Registrar of
Companies, as may be necessary in order to approve and implement the
provisions of this Agreement.
3.2
The Suspensive Conditions have been inserted for the benefit of both Parties
and may therefore only be waived by agreement in writing between the Parties.
3.3
Each of the Parties will use commercially reasonable endeavours and the
Parties will co-operate in good faith to procure the fulfilment of the Suspensive
Conditions as soon as reasonably possible after the Signature Date.
3.4
Unless all the Suspensive Conditions have been fulfilled or waived by not later
than the date specified for fulfilment thereof set out above (or such later date or
dates as may be agreed in writing between the Parties) the provisions of this
Agreement, save for the provisions of clause 1, this clause 3, and clauses 6 to
16 which will become effective immediately, will never become of any force or
effect and the status quo ante will be restored as near as may be and neither of
the Parties will have any claim against the other in terms hereof or arising from
the failure of the Suspensive Conditions, save for any claims arising from a
breach of the provisions of clause 3.3.
4 SUBSCRIPTION, ALLOTMENT AND ISSUE
4.1
The Trust hereby, but with effect from the Closing Date, subscribes for the Class
C Pref Share at the Subscription Price.
4.2
The Trust shall pay the Subscription Price on the Closing Date in cash by
causing the Nominated Attorneys to electronically transfer such portion of the
subscription price payable by DRDGOLD to the Nominated Attorneys in trust in
terms of the Trust Loan Agreement as is equal to the Subscription Price, into
such banking account as the Company may notify the Nominated Attorneys in
writing.
4.3
On the Closing Date, against compliance by the Trust with the obligation to pay
the Subscription Price, the Company shall allot and issue the Class C Pref Share
and shall deliver the share certificate in respect thereof to the Trust.
4.4
The creation duty payable on the creation of the Class C Pref Share shall be
borne and paid by the Company.
5
RIGHTS, PRIVILEGES AND RESTRICTIONS ATTACHING TO THE CLASS
C PREF SHARE
The Class C Pref Share shall have the rights, privileges and restrictions set out
in annexe "A".
6
BREACH
6.1
If, before the completion of the allotment and issue of the Class C PrefShare,
either Party commits a breach of its obligations under this Agreement, and if the
breach in question is not remedied before the expiry of a period of 48 (forty eight)
hours after the aggrieved Party has given notice to the other Party to remedy
same, the aggrieved party shall be entitled to cancel this Agreement on written
notice to the other Party.
6.2
The Parties agree that after the subscription by the Trust for, and the allotment
and issue by the Company of, the Class C Pref Share in terms of this
Agreement, the cancellation of this Agreement in the event of a breach would be
an inappropriate and insufficient remedy and that irreparable damage would
occur if the provisions of this Agreement were not complied with. It is accordingly
agreed that, in the event of a breach, the aggrieved Party shall be entitled
(without prejudice to any other rights which it may have in law save for the right
to cancel the Agreement) to an order for specific performance and to recover any
damages which it may have suffered,
6.3
Subject to the provisions of clause 6.2, this Agreement and the Trust Loan
Agreement form part of one indivisible transaction. Should either this Agreement
or the Trust Loan Agreement be terminated for any reason whatsoever, the other
of them shall terminate simultaneously.
7
GENERAL WARRANTIES
Each of the Parties hereby warrants to and in favour of the other that —
7.1
it has the legal capacity and has taken all necessary corporate action required to
empower and authorise it to enter into this Agreement; and
7.2
this Agreement constitutes an agreement valid and binding on it and enforceable
against it in accordance with its terms.
8
CO-OPERATION
8.1
The Parties undertake at all times to co-operate with each other in good faith in
order to carry out this Agreement and to implement all transactions and steps
contemplated herein. The Parties further undertake not to take any action or to
omit taking any action which will result in delaying or impeding the
implementation of this Agreement.
9
PUBLICITY
9.1
Subject to the provisions of clause 9.3, each Party undertakes to keep
confidential and not to disclose to any third party, save as may be required in law
(including by the rules of any recognised securities exchange) or permitted in
terms of this Agreement, the nature, content or existence of this Agreement and
any and all information given by a Party to the other Party pursuant to this
Agreement.
9.2
No announcements of any nature whatsoever shall be made by or on behalf of a
Party relating to this Agreement without the prior consent of the other Party, save
for any announcement or other statement required to be made in terms of the
provisions of any law (or the rules of any recognised securities exchange) in
which event the Party obliged to make such statement shall first consult with the
other Party in order to enable them in good faith to attempt to agree the content
of such announcement, which (unless agreed) must go no further than is
required in terms of such law or rules. This shall not apply to a Party wishing to
respond to the other Party which has made an announcement of some nature in
breach of this clause 9.
9.3
The provisions of this clause 9 shall not apply to any disclosure made by a Party
to its professional advisors or consultants, provided that they have agreed to the
same confidentiality undertakings, or to any judicial or arbitral tribunal or officer,
in connection with any matter relating to this Agreement or arising out of it.
10
DISPUTE RESOLUTION
10.1
In the event of there being any dispute or difference between the Parties arising
out of this Agreement, or in connection with it, or regarding its interpretation,
validity, execution, implementation, termination or cancellation, the said dispute
or difference shall on written demand by either Party be submitted to arbitration
in Johannesburg in accordance with the AFSA rules for commercial arbitration.
10.2 Should AFSA, as an institution, not be operating at that time or not be accepting
requests for arbitration for any reason, then the arbitration shall be conducted in
accordance with the AFSA rules for commercial arbitration, but administered by
the attorneys of the Parties, before an arbitrator appointed by agreement
between the Parties or failing agreement within 10 (ten) business days of the
demand for arbitration, then either Party shall be entitled to forthwith call upon
the chairperson of the Johannesburg Bar Council to nominate the arbitrator,
provided that the person so nominated shall be an advocate of not less than 10
(ten) years standing as such. The person so nominated shall be accepted by and
appointed as the arbitrator by the Parties. In the event of the attorneys of the
Parties failing to agree on any matter relating to the administration of the
arbitration, such matter shall be referred to and decided by the arbitrator whose
decision shall be final and binding on the Parties.
10.3
Either Party may appeal the decision of the arbitrator or arbitrators in terms of
the AFSA rules for commercial arbitration.
10.4
Nothing herein contained shall be deemed to prevent or prohibit a Party from
applying to the appropriate court for urgent relief or for judgment in relation to a
liquidated claim.
10.5 Any arbitration in terms of this clause 10 shall be conducted in camera and the
Parties shall treat as confidential and not disclose to any third party details of the
dispute submitted to arbitration, the conduct of the arbitration proceedings or the
outcome of the arbitration, without the written consent of the other Party.
10.6 The provisions of this clause 10 will continue to be binding on the Parties
notwithstanding any termination or cancellation of the Agreement.
10.7 The Parties agree that the written demand by a Party in terms of clause 10.1 that
the dispute or difference be submitted to arbitration, is to be deemed to be a
legal process for the purpose of interrupting extinctive prescription in terms of the
Prescription Act, 1969.
11
BENEFIT OF THE AGREEMENT
This Agreement will be also for the benefit of and be binding upon the
successors in title and permitted assigns of the Parties or either of them.
12
NOTICES AND DOMICILIA
12.1 The Parties choose as their respective domicilia citandi et executandi for the
purpose of legal proceedings and for the purposes of giving or sending any
notice provided for or necessary in terms of this Agreement, the following
addresses and telefax numbers for each of them -
Name Physical Address Telefax
Trust
The Birches
+27 (0) 11 457 6901
Riverwoods Office Park
Johnson Road
Bedfordview
Marked for the attention of Dr Paseka Ncholo
Name
Physical Address
Telefax
Company
4 Ebsco House
+27 (0)11 482 4641
299 Pendoring Ave
Blackheath
Marked for the attention of: N Pretorius
provided that a Party may change its domicilium to any other physical address or telefax
number within the Republic of South Africa by written notice to the other Party to that
effect. Such change of address will be effective 5 (five) business days after receipt of the
notice of the change of domicilium.
12.2
All notices to be given in terms of this Agreement will be in writing and will -
12.2.1
be delivered by hand or sent by telefax;
12.2.2
if delivered by hand during business hours, be presumed to have been
received on the date of delivery. Any notice delivered after business hours or
on a day which is not a business day will be presumed to have been received
on the following business day; and
12.2.3
if sent by telefax during business hours, be presumed to have been received
on the date of successful transmission of the telefax. Any telefax sent after
business hours or on a day which is not a business daywill be presumed to
have been received on the following business day.
12.3
Notwithstanding the above, any notice given in writing, and actually received by
the Party to whom the notice is addressed, will be deemed to have been properly
given and received, notwithstanding that such notice has not been given in
accordance with this clause.
12.4
The Parties record that whilst they may correspond via email during the currency
of this Agreement for operational reasons, no formal notice required in terms of
this Agreement, nor any amendment of or variation to this Agreement may be
given or concluded via email.
13
GENERAL
13.1
This Agreement constitutes the whole of the agreement between the Parties
relating to the matters dealt with herein and, save to the extent otherwise
provided herein, no undertaking, representation, term or condition relating to the
subject matter of this Agreement not incorporated in this Agreement will be
binding on either of the Parties.
13.2
No variation, addition, deletion, or agreed cancellation will be of any force or
effect unless in writing and signed by or on behalf of the Parties. Failure or
delay on the part of either Party in exercising any right, power or privilege
hereunder will not constitute or be deemed to be a waiver thereof, nor will any
single or partial exercise of any right, power or privilege preclude any other or
further exercise thereof or the exercise of any other right, power or privilege.
13.3
All provisions and the various clauses and sub-clauses of this Agreement are,
notwithstanding the manner in which they have been grouped together or linked
grammatically, severable from each other. Any provision, clause or sub-clause
of this Agreement which is or becomes unenforceable in any jurisdiction,
whether due to voidness, invalidity, illegality, unlawfulness or for any other
reason whatever, shall, in such jurisdiction only and only to the extent that it is
so unenforceable, be treated as pro non scnpto and the remaining provisions,
clauses and sub-clauses of this Agreement shall remain of full force and effect.
13.4 Neither this Agreement nor any part, share or interest therein nor any rights or
obligations hereunder may be ceded, assigned, or otherwise transferred without
the prior written consent of the other Party.
13.5
This Agreement may be executed in one or more counterparts, each of which
will be deemed an original, and all of which together will constitute one and the
same agreement as at the date of signature of the Party last signing one of the
counterparts.
14
APPLICABLE LAW AND JURISDICTION
14.1
This Agreement will in all respects be governed by and construed under the laws
of the Republic of South Africa.
14.2 Subject to the provisions of clause 10, the Parties hereby consent and submit to
the non-exclusive jurisdiction of the Witwatersrand Local Division of the High
Court of the Republic of South Africa in any dispute arising from or in connection
with this Agreement. The Parties agree that any costs awarded will be
recoverable in accordance with the High Court tariff, determined on an attorney-
and-own-client scale.
15 COSTS
It is recorded that the fees and disbursements of the Nominated Attorneys of and
incidental to the negotiation, drafting, preparation and implementation of this
Agreement will be borne and paid by DRDSA. All further legal costs and
expenses of and incidental to the negotiation, drafting, preparation and
implementation of this Agreement will be paid by the Party incurring such costs.
16
SIGNATURE
Signed on behalf of the Parties as set out below, each signatory hereto
warranting that he or she has due authority to do so -
SIGNED at BEDFORDVIEW on 24 October 2006
For and on behalf of
THE TRUSTEES FOR THE TIME
BEING OF THE DRDSA
EMPOWERMENT TRUST
_________________________________
_
Signature:
/s/ T Mogotsi
Trustee
SIGNED at ___________________________on 30 November 2006.
For and on behalf of
CROWN GOLD RECOVERIES
(PROPRIETARY) LIMITED
_________________________________
Signature: /s/ LC Lamsley
_________________________________
Name of Signatory:
_________________________________
Designation of Signatory:
COO
TERMS AND CONDITIONS OF THE CLASS C CUMULATIVE
PARTICIPATING PREFERENCE SHARE
1
In this annexe "A", unless the context otherwise indicates, the following terms shall
have the meanings assigned to them hereunder -
1.1
"Act" means the Companies Act, 1973;
1.2
"Company" means Crown Gold Recoveries (Proprietary) Limited, registration
number 1988/0055115107, a limited liability private company duly incorporated in
the Republic of South Africa;
1.3
"Class A Pref Share" means the existing Class A cumulative participating
preference share in the share capital of the Company with a par value of R1.00
(one rand);
1.4
"Class B Pref Share" means a Class B cumulative participating preference share
in the share capital of the Company with a par value of R1.00 (one rand);
1.5
"Class C Pref Share" means a Class C cumulative participating preference share
in the share capital of the Company with a par value of R1.00 (one rand), and
having the rights, privileges and restrictions contained in annexe "A";
1.6
"Dividend Date" means the last business day of each successive Dividend Period
on which date the Preference Dividend owing to the Holder is calculated and
becomes due and payable;
1.7
"Dividend Period" means successive periods of 3 (three) months each,
commencing on the V' (first) day following the preceding Dividend Period and
ending on the last business day of each of December, March, June and September
in each year, provided that the 1
st
(first) Dividend Period will commence on the 1
st
(first) day following the Issue Date;
1.8
"DRDGOLD" means DRDGOLD Limited, registration number 1895/000926106, a
limited liability public company duly incorporated in the Republic of South Africa;
1.9
"Holder" means the holder of the Class C Pref Share from time to time;
1.10
"IDC" means the Industrial Development Corporation of South Africa Limited,
registration number 1940/014201/06, a body corporate duly incorporated by statute
in the Republic of South Africa;
1.11
"Issue Date" means the actual date of issue of the Class C Pref Share;
1.12
"Preference Dividend" means the preferential cash dividend payable to the
Holder in accordance with the provisions of clause 3.1;
1.13
"Secured Shareholder Loans" means the loans recorded in the loan agreements
concluded during February 2003 between the Company and each of DRDGOLD
and the IDC, the rights and obligations of the IDC under the relevant loan
agreement since having been assigned to DRDGOLD; and
1.14
"Subscription Price" means the amount of R1,091,400.00 (one million ninety
one thousand four hundred rands).
2
The Class C Pref Share will be allotted and issued at par plus a premium in the
aggregate equal to the Subscription Price.
3
The Class C Pref Share will carry the following special rights and will be subject to
the following special conditions -
3.1
The Class C Pref Share carries the right in favour of the Holder to call for and
receive, after the payment of the preference dividend payable on the Class A Pref
Share, contemporaneously with the payment of the preference dividend payable
on the Class B Pref Share, but in priority to any dividend on any other class of
shares for the time being issued by the Company, a preferential dividend in an
amount of R0.06 (six cents) (less any Secondary Tax on Companies, or any other
dividend tax imposed in its stead which the Company becomes obliged to pay on
every dividend of R0.06 (six cents)) for every R0.74 (seventy four cents) that the
Company pays to DRDGOLD or its successor in title, both towards capital and
interest on capital in terms of the Secured Shareholder Loans.
3.2
Each Preference Dividend shall accrue in favour of the Holder immediately upon
payment of any amount towards the Shareholder Loans and shall become payable
on the next Dividend Date.
3.3
The Class C Pref Share shall entitle the Holder to receive Preference Dividends
until the outstanding balance on the Secured Shareholder Loans has been
reduced to Nil.
3.4
On a winding-up of the Company or on any repayment of its capital, the Class C
Pref Share shall rank, in regard to all arrears of Preference Dividends (whether
declared or not) calculated to the date of the distribution or repayment, after the
Class A Pref Share, equally with the Class B Pref Share, but in priority to any other
shares for the time being issued by the Company.
3.5
The Class C Pref Share shall not be entitled to any further (in addition to what is
contained herein) participation in the profits or assets of the Company or, on its
winding-up, in the distribution of its surplus assets.
3.6
The Holder shall be entitled to receive notice of and be entitled to attend but not to
vote at any general meeting of the Company in respect of the Class C Pref Share
unless, any Preference Dividend remains in arrear and unpaid for a period of 7
(seven) days after a Dividend Date, or a resolution is to be proposed at the
general meeting -
3.6.1
which directly or indirectly adversely affects the rights attached to the Class C
Pref Share or directly affects the interests of the Holder; or
3.6.2
for the disposal of the whole or substantially the whole of the undertaking of the
Company or the whole or the greater part of the assets of the Company, in
which event the Holder shall be entitled to vote on any such resolution.
3.7
The Holder shall, when it is entitled to vote and is present in person or is
represented by a representative or by a proxy at a general meeting, have -
3.7.1
one vote on a show of hands;
3.7.2
so many votes on a poll as is determined in accordance with section 195 of the
Act.
3.8
Notwithstanding anything to the contrary herein contained -
3.8.1
the terms of the Class C Pref Share may not be cancelled, varied or added to;
and
3.8.2
other than the existing Class A Pref Share and the Class B Pref Share,no
shares in the capital of the Company, ranking, as regards rights to dividends or,
on a winding-up or return of capital, in priority to or pari passu with the Class C
Fret Share shall be created or issued, without a special resolution of the
Company and without the consent in writing of the Holder.
3.9
A certificate issued by the auditors of the Company for the time being as to the
Preference Dividends due from time to time shall, unless and until the contrary is
proved, be binding on the Company and all its members.
3.10 The Company shall not be liable to the Holder for interest on any unclaimed
Preference Dividend. The Company shall retain all unclaimed monies until they are
claimed; provided that any amount remaining unclaimed for a period of 12 (twelve)
years shall be forfeited by the Holder to the Company
.
CLASS C PREFERENCE SHARE SUBSCRIPTION
AGREEMENT
between
THE TRUSTEES FOR THE TIME BEING OF THE DRDSA EMPOWERMENT
TRUST
and
EAST RAND PROPRIETARY MINES LIMITED
TABLE OF CONTENTS
1 INTERPRETATION ................................................................................
3
2 RECORDALS .........................................................................................
6
3 SUSPENSIVE
CONDITIONS ..................................................................
7
4 SUBSCRIPTION, ALLOTMENT AND ISSUE .........................................
8
5
RIGHTS, PRIVILEGES AND RESTRICTIONS ATTACHING TO THE
CLASS C PREF SHARE......................................................................
8
6 BREACH................................................................................................
8
7 GENERAL
WARRANTIES ....................................................................
9
8 CO-OPERATION ..................................................................................
10
9 PUBLICITY ............................................................................................
10
10 DISPUTE
RESOLUTION .....................................................................
11
11 BENEFIT OF THE AGREEMENT ......................................................
12
12 NOTICES AND DOMICILIA ................................................................
12
13 GENERAL...........................................................................................
14
14 APPLICABLE LAW AND JURISDICTION ..........................................
15
15 COSTS ..............................................................................................
15
16 SIGNATURE.......................................................................................
15
ANNEXES
ANNEXE "A"
RIGHTS, PRIVILEGES AND RESTRICTIONS OF THE CLASS C
CUMULATIVE PARTICIPATING PREFERENCE SHARE
WHEREBY THE PARTIES AGREE AS FOLLOWS -
1. INTERPRETATION
1.1
In this Agreement -
1.1.1 clause headings are for convenience only and are not to be used in its
interpretation;
1.1.2 an expression which denotes -
1.1.2.1
any gender includes the other genders;
1.1.2.2
a natural person includes a juristic person and vice versa; and
1.1.2.3
the singular includes the plural and vice versa.
1.2
In this Agreement, unless the context clearly indicates a contrary intention, the
following words and expressions shall bear the meanings assigned to them below
and cognate words and expressions shall bear corresponding meanings -
1.2.1
"Act" means the Companies Act, 1973;
1.2.2
"AFSA" means the Arbitration Foundation of Southern Africa;
1.2.3
"Agreement" means this Class C Preference Share Subscription Agreement;
1.2.4
"Class C Pref Share" means a Class C cumulative participating preference
share in the share capital of the Company with a par value of R1.00 (one
rand), and having the rights, privileges and restrictions contained in annexe
"A";
1.2.5
"Closing Date" means the 1
5`
(first) business day after the date upon which
the last of the Suspensive Conditions has been fulfilled or waived, as the case
may be;
1.2.6
"Company" means East Rand Proprietary Mines Limited, registration number
1893/000773/06, a limited liability public company duly incorporated in the
Republic of South Africa;
1.2.7
"DRDGOLD" means DRDGOLD Limited, registration number
1895/000926/06, a limited liability public company duly incorporated in the
Republic of South Africa;
1.2.8 "DRDSA" means DRDGOLD South African Operations (Proprietary) Limited,
registration number 2005/033662/07, a limited liability private company duly
incorporated in the Republic of South Africa;
1.2.9
"Khumo Gold SPV" means Khumo Gold SPV (Proprietary) Limited,
registration number 2005/029595/07, a limited liability private company duly
incorporated in the Republic of South Africa;
1.2.10
"Nominated Attorneys" means Cliffe Dekker Incorporated, registration
number 1998/018173/21, a firm of attorneys incorporated as a private
company in the Republic of South Africa in accordance with section 53(b) of
the Act;
1.2.11
"Parties" means the parties to this Agreement;
12.12
"Signature Date" means the date of signature of this Agreement by the Party
last signing;
1.2.13
"Subscription Price" means the amount of R6,432,000.00 (six million four
hundred and thirty two thousand rand);
1.2.14
"Suspensive Conditions" means the suspensive conditions contained in
clause 3.1;
1.2.15
"Trust" means the DRDSA Empowerment Trust, an inter vivos trust
established by oral agreement between Khumo Gold SPV, Masecheaba
Palesa Moletsane Ncholo and Mervin Percival Thulo Mogotsi on 07 September
2006; and
1.2.16
"Trust Loan Agreement" means the Loan Agreement entered into or to be
entered into between DRDGOLD and the Trust contemporaneously with the
entering into of this Agreement, and in terms of which DRDGOLD will lend and
advance to the Trust an amount of R14,128,800.00 (fourteen million one
hundred and twenty eight thousand eight hundred rand).
1.3
Any substantive provision, conferring rights or imposing obligations on a Party
and appearing in any of the definitions in this clause 1 or elsewhere in this
Agreement, shall be given effect to as if it were a substantive provision in the
body of the Agreement.
1.4
Words and expressions defined in any clause will, unless the application of any
such word or expression is specifically limited to that clause, bear the meaning
assigned to such word or expression throughout this Agreement.
1.5
Subject to the provisions of clauses 1.6 and 1.11, defined terms appearing in this
Agreement in title case will be given their meaning as defined, while the same
terms appearing in lower case will be interpreted in accordance with their plain
English meaning.
1.6
A reference to any statutory enactment will be construed as a reference to that
enactment as at the Signature Date and as amended or substituted from time to
time.
1.7
Reference to "days" will be construed as calendar days unless qualified by the
word "business", in which instance a "business day" will be any day other than a
Saturday, Sunday or public holiday as gazetted by the government of the
Republic of South Africa from time to time. Any reference to "business hours"
shall be construed as being the hours between 08h30 and 17h00 on any
business day. Any reference to time shall be based upon Central African Time.
1.8
Unless specifically otherwise provided, any number of days prescribed will be
determined by excluding the first and including the last day or, where the last day
falls on a day that is not a business day, the next succeeding business day.
1.9
Where figures are referred to in numerals and in words, and there is any conflict
between the two, the words will prevail, unless the context indicates a contrary
intention.
1.10
No provision herein will be construed against or interpreted to the disadvantage of
a Party by reason of such Party having or being deemed to have structured,
drafted or introduced such provision.
1.11 In this Agreement the words "clause" or "clauses" refer to clauses of this
Agreement.
2 RECORDALS
2.1
In terms of the Trust Loan Agreement, DRDGOLD will lend and advance an
amount of R14,128,800.00 (fourteen million one hundred and twenty eight
thousand eight hundred rand) to the Trust, on condition, inter alia, that the Trust
applies the proceeds of the said subscription to subscribe for inter alia the Class
C Pref Share.
2.2
The Trust has agreed to subscribe for, and the Company has agreed to allot and
issue to the Trust, the Class C Pref Share upon the terms and conditions
contained in this Agreement.
2.3
The Parties wish to record in writing their agreement in respect of the above and
matters ancillary thereto.
3
SUSPENSIVE CONDITIONS
3.1
This Agreement, save for the provisions of clause 1, this clause 3, and clauses
6 to 16 which will become effective immediately, shall be subject to the
suspensive conditions that, by no later than 30 November 2006 –
3.1.1
the Trust Loan Agreement has been entered into and has become
unconditional in accordance with its terms, save in respect of any condition
requiring that this Agreement becomes unconditional; and
3.1.2
all such resolutions have been passed by the shareholders and directors of
the Company and, where required, registered by the Registrar of Companies,
as may be necessary in order to approve and implement the provisions of this
Agreement.
3.2
The Suspensive Conditions have been inserted for the benefit of both Parties and
may therefore only be waived by agreement in writing between the Parties.
3.3
Each of the Parties will use commercially reasonable endeavours and the Parties
will co-operate in good faith to procure the fulfilment of the Suspensive Conditions
as soon as reasonably possible after the Signature Date.
3.4
Unless all the Suspensive Conditions have been fulfilled or waived by not later
than the date specified for fulfilment thereof set out above (or such later date or
dates as may be agreed in writing between the Parties) the provisions of this
Agreement, save for the provisions of clause 1, this clause 3, and clauses 6 to 16
which will become effective immediately, will never become of any force or effect
and the
status quo ante will be restored as near as may be and neither of the
Parties will have any claim against the other in terms hereof or arising from the
failure of the Suspensive Conditions, save for any claims arising from a breach of
the provisions of clause 3.3.
4 SUBSCRIPTION, ALLOTMENT AND ISSUE
4.1
The Trust hereby, but with effect from the Closing Date, subscribes for the
Class C Pref Share at the Subscription Price.
4.2
The Trust shall pay the Subscription Price on the Closing Date in cash by causing
the Nominated Attorneys to electronically transfer such portion of the subscription
price payable by DRDGOLD to the Nominated Attorneys in trust in terms of the
Trust Loan Agreement as is equal to the Subscription Price, into such banking
account as the Company may notify the Nominated Attorneys in writing.
4.3
On the Closing Date, against compliance by the Trust with the obligation to pay
the Subscription Price, the Company shall allot and issue the Class C Pref Share
and shall deliver the share certificate in respect thereof to the Trust.
4.4
The creation duty payable on the creation of the Class C Pref Share shall be
borne and paid by the Company.
5
RIGHTS, PRIVILEGES AND RESTRICTIONS ATTACHING TO THE CLASS C
PREF SHARE
The Class C Pref Share shall have the rights, privileges and restrictions set out
in annexe "A".
6
BREACH
6.1
If, before the completion of the allotment and issue of the Class C Pref Share,
either Party commits a breach of its obligations under this Agreement, and if the
breach in question is not remedied before the expiry of a period of 48 (forty eight)
hours after the aggrieved Party has given notice to the other Party to remedy
same, the aggrieved party shall be entitled to cancel this Agreement on written
notice to the other Party.
6.2
The Parties agree that after the subscription by the Trust for, and the allotment
and issue by the Company of, the Class C Pref Share in terms of this Agreement,
the cancellation of this Agreement in the event of a breach would be an
inappropriate and insufficient remedy and that irreparable damage would occur if
the provisions of this Agreement were not complied with. It is accordingly agreed
that, in the event of a breach, the aggrieved Party shall be entitled (without
prejudice to any other rights which it may have in law save for the right to cancel
the Agreement) to an order for specific performance and to recover any damages
which it may have suffered.
6.3 Subject to the provisions of clause 6.2, this Agreement and the Trust Loan
Agreement form part of one indivisible transaction. Should either this Agreement
or the Trust Loan Agreement be terminated for any reason whatsoever, the other
of them shall terminate simultaneously.
7
GENERAL WARRANTIES
Each of the Parties hereby warrants to and in favour of the other that -
7.1
it has the legal capacity and has taken all necessary corporate action required to
empower and authorise it to enter into this Agreement; and
7.2
this Agreement constitutes an agreement valid and binding on it and enforceable
against it in accordance with its terms.
8
CO-OPERATION
8.1
The Parties undertake at all times to co-operate with each other in good faith in
order to carry out this Agreement and to implement all transactions and steps
contemplated herein. The Parties further undertake not to take any action or to
omit taking any action which will result in delaying or impeding the implementation
of this Agreement.
9
PUBLICITY
9.1
Subject to the provisions of clause 9.3, each Party undertakes to keep
confidential and not to disclose to any third party, save as may be required in law
(including by the rules of any recognised securities exchange) or permitted in
terms of this Agreement, the nature, content or existence of this Agreement and
any and all information given by a Party to the other Party pursuant to this
Agreement.
9.2
No announcements of any nature whatsoever shall be made by or on behalf of a
Party relating to this Agreement without the prior consent of the other Party, save
for any announcement or other statement required to be made in terms of the
provisions of any law (or the rules of any recognised securities exchange) in
which event the Party obliged to make such statement shall first consult with the
other Party in order to enable them in good faith to attempt to agree the content
of such announcement, which (unless agreed) must go no further than is required
in terms of such law or rules. This shall not apply to a Party wishing to respond to
the other Party which has made an announcement of some nature in breach of
this clause 9.
9.3
The provisions of this clause 9 shall not apply to any disclosure made by a Party
to its professional advisors or consultants, provided that they have agreed to the
same confidentiality undertakings, or to any judicial or arbitral tribunal or officer,
in connection with any matter relating to this Agreement or arising out of it.
10 DISPUTE RESOLUTION
10.1
In the event of there being any dispute or difference between the Parties arising
out of this Agreement, or in connection with it, or regarding its interpretation,
validity, execution, implementation, termination or cancellation, the said dispute
or difference shall on written demand by either Party be submitted to arbitration in
Johannesburg in accordance with the AFSA rules for commercial arbitration.
10.2
Should AFSA, as an institution, not be operating at that time or not be accepting
requests for arbitration for any reason, then the arbitration shall be conducted in
accordance with the AFSA rules for commercial arbitration, but administered by
the attorneys of the Parties, before an arbitrator appointed by agreement between
the Parties or failing agreement within 10 (ten) business days of the demand for
arbitration, then either Party shall be entitled to forthwith call upon the
chairperson of the Johannesburg Bar Council to nominate the arbitrator, provided
that the person so nominated shall be an advocate of not less than 10 (ten) years
standing as such. The person so nominated shall be accepted by and appointed
as the arbitrator by the Parties. In the event of the attorneys of the Parties failing
to agree on any matter relating to the administration of the arbitration, such
matter shall be referred to and decided by the arbitrator whose decision shall be
final and binding on the Parties.
10.3
Either Party may appeal the decision of the arbitrator or arbitrators in terms of
the AFSA rules for commercial arbitration.
10.4
Nothing herein contained shall be deemed to prevent or prohibit a Party from
applying to the appropriate court for urgent relief or for judgment in relation to a
liquidated claim.
10.5 Any arbitration in terms of this clause 10 shall be conducted in camera and the
Parties shall treat as confidential and not disclose to any third party details of the
dispute submitted to arbitration, the conduct of the arbitration proceedings or the
outcome of the arbitration, without the written consent of the other Party.
10.6 The provisions of this clause 10 will continue to be binding on the Parties
notwithstanding any termination or cancellation of the Agreement.
10.7
The Parties agree that the written demand by a Party in terms of clause 10.1 that
the dispute or difference be submitted to arbitration, is to be deemed to be a legal
process for the purpose of interrupting extinctive prescription in terms of the
Prescription Act, 1969.
11
BENEFIT OF THE AGREEMENT
11.1
This Agreement will be also for the benefit of and be binding upon the successors
in title and permitted assigns of the Parties or either of them.
12
NOTICES AND DOMICILIA
12.1
The Parties choose as their respective domicilia citandi et executandi for the
purpose of legal proceedings and for the purposes of giving or sending any notice
provided for or necessary in terms of this Agreement, the following addresses
and telefax numbers for each of them -
Name Physical Address
Telefax
Trust
The Birches
+27 (0) 11 457 6901
Riverwoods Office Park
Johnson Road
Bedfordview
Marked for the attention of Dr Paseka Ncholo
Name
Physical Address
Telefax
Company
4 Ebsco House
+27 (0)11 482 4641
299 Pendoring Ave
Blackheath
Marked for the attention of: N Pretorius
provided that a Party may change its domicilium to any other physical address or telefax
number within the Republic of South Africa by written notice to the other Party to that
effect. Such change of address will be effective 5 (five) business days after receipt of the
notice of the change of domicilium.
12.2
All notices to be given in terms of this Agreement will be in writing and will -
12.2.1
be delivered by hand or sent by telefax;
12.2.2
if delivered by hand during business hours, be presumed to have been
received on the date of delivery. Any notice delivered after business hours or
on a day which is not a business day will be presumed to have been
received on the following business day; and
12.2.3
if sent by telefax during business hours, be presumed to have been received
on the date of successful transmission of the telefax. Any telefax sent after
business hours or on a day which is not a business day will be presumed to
have been received on the following business day.
12.3 Notwithstanding the above, any notice given in writing, and actually received by
the Party to whom the notice is addressed, will be deemed to have been properly
given and received, notwithstanding that such notice has not been given in
accordance with this clause.
12.4 The Parties record that whilst they may correspond via email during the currency
of this Agreement for operational reasons, no formal notice required in terms of
this Agreement, nor any amendment of or variation to this Agreement may be
given or concluded via email.
13
GENERAL
13.1
This Agreement constitutes the whole of the agreement between the Parties
relating to the matters dealt with herein and, save to the extent otherwise
provided herein, no undertaking, representation, term or condition relating to the
subject matter of this Agreement not incorporated in this Agreement will be
binding on either of the Parties.
13.2 No variation, addition, deletion, or agreed cancellation will be of any force or
effect unless in writing and signed by or on behalf of the Parties. Failure or delay
on the part of either Party in exercising any right, power or privilege hereunder
will not constitute or be deemed to be a waiver thereof, nor will any single or
partial exercise of any right, power or privilege preclude any other or further
exercise thereof or the exercise of any other right, power or privilege.
13.3 All provisions and the various clauses and sub-clauses of this Agreement are,
notwithstanding the manner in which they have been grouped together or linked
grammatically, severable from each other. Any provision, clause or sub-clause of
this Agreement which is or becomes unenforceable in any jurisdiction, whether
due to voidness, invalidity, illegality, unlawfulness or for any other reason
whatever, shall, in such jurisdiction only and only to the extent that it is so
unenforceable, be treated as pro non scripto and the remaining provisions,
clauses and sub-clauses of this Agreement shall remain of full force and effect.
13.4 Neither this Agreement nor any part, share or interest therein nor any rights or
obligations hereunder may be ceded, assigned, or otherwise transferred without
the prior written consent of the other Party.
13.5
This Agreement may be executed in one or more counterparts, each of which will
be deemed an original, and all of which together will constitute one and the same
agreement as at the date of signature of the Party last signing one of the
counterparts.
14
APPLICABLE LAW AND JURISDICTION
14.1
This Agreement will in all respects be governed by and construed under the
laws of the Republic of South Africa.
14.2
Subject to the provisions of clause 10, the Parties hereby consent and submit to
the non-exclusive jurisdiction of the Witwatersrand Local Division of the High
Court of the Republic of South Africa in any dispute arising from or in connection
with this Agreement. The Parties agree that any costs awarded will be
recoverable in accordance with the High Court tariff, determined on an attorney-
and-own-client scale.
15 COSTS
It is recorded that the fees and disbursements of the Nominated Attorneys of and
incidental to the negotiation, drafting, preparation and implementation of this
Agreement will be borne and paid by DRDSA. All further legal costs and
expenses of and incidental to the negotiation, drafting, preparation and
implementation of this Agreement will be paid by the Party incurring such costs.
16 SIGNATURE
Signed on behalf of the Parties as set out below, each signatory hereto
warranting that he or she has due authority to do so -
SIGNED at BEDFORDVIEW on 24 October 2006
For and on behalf of
THE TRUSTEES FOR THE TIME
BEING OF THE DRDSA
EMPOWERMENT TRUST
__________________________________
Signature:
/s/ T Mogotsi
Trustee
SIGNED at ___________________________on 30 November 2006.
For and on behalf of
EAST RAND PROPRIETARY
MINES LIMITED
_________________________________
Signature: /s/ LC Lamsley
_________________________________
Name of Signatory:
_________________________________
Designation of Signatory:
COO
TERMS AND CONDITIONS OF THE CLASS C CUMULATIVE
PARTICIPATING PREFERENCE SHARE
1
In this annexe "A", unless the context otherwise indicates, the following terms
shall have the meanings assigned to them hereunder -
1.1
"Act" means the Companies Act, 1973;
1.2
"Company" means East Rand Proprietary Mines Limited, registration number
1893/000773/06, a limited liability public company duly incorporated in the
Republic of South Africa;
1.3
"Class A Pref Share" means the existing Class A cumulative participating
preference share in the share capital of the Company with a par value of R1.00
(one rand);
1.4
"Class B Pref Share" means a Class B cumulative participating preference
share in the share capital of the Company with a par value of R1.00 (one rand);
1.5
"Class C Pref Share" means a Class C cumulative participating preference
share in the share capital of the Company with a par value of R1.00 (one rand),
and having the rights, privileges and restrictions contained in annexe "A";
1.6
"Debenture Deeds" means the debenture deeds concluded during February
2003 between the Company and each of DRDGOLD and the IDC, the rights and
obligations of the IDC under the relevant debenture deed since having been
assigned to DRDGOLD;
1.7
"Dividend Date" means the last business day of each successive Dividend
Period on which date the Preference Dividend owing to the Holder is calculated
and becomes due and payable;
1.8
"Dividend Period" means successive periods of 3 (three) months each,
commencing on the 1
st
(first) day following the preceding Dividend Period and
ending on the last business day of each of December, March, June and
September in each year, provided that thei
st
(first) Dividend Period will commence
on the 1
5t
(first) day following the Issue Date;
1.9
"DRDGOLD" means DRDGOLD Limited, registration number 1895/000926/06, a
limited liability public company duly incorporated in the Republic of South Africa;
1.10
"Holder" means the holder of the Class C Pref Share from time to time;
1.11 "1DC" means the Industrial Development Corporation of South Africa Limited,
registration number 1940/014201/06, a body corporate duly incorporated by
statute in the Republic of South Africa;
1.12
"Issue Date" means the actual date of issue of the Class C Pref Share;
1.13
"Preference Dividend" means the preferential cash dividend payable to the
Holder in accordance with the provisions of clause 3.1;
1.14 "Secured Shareholder Loans" means the loans recorded in the loan
agreements concluded during February 2003 between the Company and each of
DRDGOLD and the IDC, the rights and obligations of the IDC under the relevant
loan agreement since having been assigned to DRDGOLD; and
1.15
"Subscription Price" means the amount of R6,432,000.00 (six million four
hundred and thirty two thousand rand).
2
The Class C Pref Share will be allotted and issued at par plus a premium in the
aggregate equal to the Subscription Price.
3
The Class C Pref Share will carry the following special rights and will be subject
to the following special conditions -
3.1
The Class C Pref Share carries the right in favour of the Holder to call for and
receive, after the payment of the preference dividend payable on the Class A
Pref Share, contemporaneously with the payment of the preference dividend
payable on the Class B Pref Share, but in priority to any dividend on any other
class of shares for the time being issued by the Company, a preferential
dividend in an amount of R0.06 (six cents) (less any Secondary Tax on
Companies, or any other dividend tax imposed in its stead which the Company
becomes obliged to pay on every dividend of R0.06 (six cents)) for every R0.74
(seventy four cents) that the Company pays to DRDGOLD or its successor in
title, both towards –
3.1.1
capital and interest on capital in terms of the Secured Shareholder Loans; and
3.1.2
interest and smelter royalties in terms of, or to redeem, the debentures issued
by the Company in terms of the Debenture Deeds.
3.2
Each Preference Dividend shall accrue in favour of the Holder immediately upon
payment of any amount towards the Secured Shareholder Loans or in terms of
the Debenture Deeds and shall become payable on the next Dividend Date.
3.3
The Class C Pref Share shall entitle the Holder to receive Preference Dividends
until the –
3.3.1 the outstanding balance on the Secured Shareholder Loans has been reduced to
Nil; and
3.3.2 the debentures issued under the Debenture Deeds have been redeemed in full
and all amounts owing in respect of such debentures have been paid in full.
3.4
On a winding-up of the Company or on any repayment of its capital, the Class C
Pref Share shall rank, in regard to all arrears of Preference Dividends (whether
declared or not) calculated to the date of the distribution or repayment, after the
Class A Pref Share, equally with the Class B Pref Share, but in priority to any
other shares for the time being issued by the Company.
3.5
The Class C Pref Share shall not be entitled to any further (in addition to what is
contained herein) participation in the profits or assets of the Company or, on its
winding-up, in the distribution of its surplus assets.
3.6
The Holder shall be entitled to receive notice of and be entitled to attend but not
to vote at any general meeting of the Company in respect of the Class C Pref
Share unless, any Preference Dividend remains in arrear and unpaid for a period
of 7 (seven) days after a Dividend Date, or a resolution is to be proposed at the
general meeting -
3.6.1
which directly or indirectly adversely affects the rights attached to the Class C
Pref Share or directly affects the interests of the Holder; or
3.6.2
for the disposal of the whole or substantially the whole of the undertaking of
the Company or the whole or the greater part of the assets of the Company, in
which event the Holder shall be entitled to vote on any such resolution.
3.7
The Holder shall, when it is entitled to vote and is present in person or is
represented by a representative or by a proxy at a general meeting, have -
3.7.1
one vote on a show of hands;
3.7.2
so many votes on a poll as is determined in accordance with section 195 of
the Act.
3.8
Notwithstanding anything to the contrary herein contained -
3.8.1
the terms of the Class C Pref Share may not be cancelled, varied or added to;
and
3.8.2
other than the existing Class A Pref Share and the Class B Pref Share, no
shares in the capital of the Company, ranking, as regards rights to dividends
or, on a winding-up or return of capital, in priority to or pari passu with the
Class C Pref Share shall be created or issued, without a special resolution of
the Company and without the consent in writing of the Holder.
3.9
A certificate issued by the auditors of the Company for the time being as to the
Preference Dividends due from time to time shall, unless and until the contrary is
proved, be binding on the Company and all its members.
3.10 The Company shall not be liable to the Holder for interest on any unclaimed
Preference Dividend. The Company shall retain all unclaimed monies until they
are claimed; provided that any amount remaining unclaimed for a period of 12
(twelve) years shall be forfeited by the Holder to the Company.