couttiraene rae co \ att 05 iy IN THE HIGH COURT OF SOUTH AFRICA (oma Shenk [GAUTENG DIVISION, PRETORIA] 0m sen ieee case no: 3 89 SMI In the matter between: DEMOCRATIC ALLIANCE Applicant and MINISTER OF PUBLIC ENTERPRISES First Respondent ESKOM HOLDINGS LIMITED Second Respondent BRIAN MOLEFE Third Respondent NOTICE OF MOTION PART A: INTERIM RELIEF TAKE NOTICE THAT the applicant will apply to this Court on TUESDAY, 30 MAY 2017 (or such other date as may be set by way of special allocation, to be applied for from the Deputy Judge President) at 10:00 or so soon thereafter as counsel may be heard for an order in the following terms: 1 The forms and service and ordinary time periods provided for in the rules are dispensed with and this application is dealt with as one of urgency in terms of Rule 6(12).2 Pending the determination of the relief sought in Part B of the notice of motion: 2.1. The third respondent (‘Mr Molefe") is interdicted from performing any duties and/or functions or receiving any benefits or entitlements deriving from or associated with the position of Group Chief Executive at the second respondent (‘Eskom’). 2.2 Mr Molefe is interdicted from receiving any payment or sum of money in respect of any purported pension agreement or proposal between him and Eskom 3 The costs of this application are to be paid jointly and severally by any respondent opposing it, alternatively costs in respect of Part A are to be costs in the cause in Part B, alternatively costs for Part A are to be reserved for determination by the Court when deciding Part B of this Notice of Motion. 4 Further and/or alternative relief. TAKE NOTICE FURTHER THAT the accompanying affidavit of JAMES SELFE will be used in support of this application. TAKE NOTICE FURTHER that the applicant has appointed the office of its attorneys, as set out below, as the address at which it will accept notice and service of alldocuments in these proceedings and Applicant elects to receive service electronically at the email address, elzanne@mindes.co.za and venashan@kebd.co.za. TAKE NOTICE FURTHER THAT if you intend to oppose Part A of this application you are required to: 1. Notify the applicant's attorney in writing and by email at elzanne@mindes.co.za and venashan@kebd.coza of your intention to oppose on or before WEDNESDAY, 17 MAY 2017; 2. Appoint an address that complies with the requirements of rule 6(5)(b) at which you will accept notice and service of all documents in these proceedings. 3. File your answering affidavit, if any, in respect of your opposition to Part A of this application, on or before 17:00 on MONDAY, 22 MAY 2017. Kindly set the matter down for hearing accordingly. PART B: FINAL RELIEF KINDLY TAKE NOTE THAT the applicant intends to make application to this Court on a date to be determined by the Registrar for an order in the following terms: 1 The forms and service and ordinary time periods provided for in the rules are dispensed with and this application is dealt with as one of urgency in terms of Rule 6(12).The decision by the first respondent to appoint and/or reinstate Mr Molefe to the position of Group Chief Executive at Eskom is reviewed and set aside. Any payment or sum of money received to date by Mr Molefe pursuant to any purported pension agreement between him and Eskom is declared to be invalid and Mr Molefe is ordered to repay such amount(s) to Eskom within ten days of this order. The costs of this application are to be paid jointly and severally by any respondent opposing it. Further and/or alternative relief. TAKE NOTICE FURTHER THAT in respect of Part B of this application: The first second and third respondents are called upon, in terms of Uniform Rule 53(1)(a), to show cause why the decision should not be reviewed and set aside. The first respondent is called upon in terms of Rule §3(1)(b) to despatch, within 10 days after service of this notice of motion, to the Registrar the record of the decision sought to be reviewed and set aside, together with such reasons as she by law is required or desires to give or make, and to notify the applicant that it has done so.- In terms of Rule 53(4) of the rules of this Court, the applicant reserves the right to amend, add to or vary the terms of its notice of motion and supplement its founding affidavit within 7 days after the Registrar has made the record available to it. - If you wish to oppose the relief sought you are required within 20 days of the expiry of the time referred to in Uniform Rules of Court 53(4), to deliver any affidavits as you may desire in answer to the allegations made by the applicant. TAKE NOTICE THAT given the urgency of the matter, the applicants have shortened the time periods provided for under uniform rule 53. TAKE NOTICE FURTHER that the applicant has appointed the office of its attorneys, as set out below, as the address at which it will accept notice and service of all documents in these proceedings and Applicant elects to receive service electronically at the email address, elzanne@mindes.co.za and venashan@kebd.co.za. TAKE NOTICE FURTHER THAT if no notice to oppose is given, the application for the relief sought in Part B will be made on 18 JULY 2017 at 10h00 or so soon thereafter ‘as counsel may be heard DATED and signed at PRETORIA on this 15th day of MAY 2017.TO: AND TO: AND TO: AND TO: IRO & SMITH INC. Applicant's attorneys Tyger Valley Office Park Building Number 2, Cnr Willie van Schoor & Old Oak Roads, Belville Tel: +27 21 918 9000 Email: elzanne@mindes.co.za Ref: Elzanne Jonker C/O KLAGSBRUN EDELSTEIN BOSMAN DE VRIES INC. 220 Lange Street Nieuw Muckleneuk PRETORIA Tel: 012 452 8900 Fax: 012 452 8901 e-mail: venashan@kebd.co.za (REF: R NYAMA/ VS / HS001003) THE REGISTRAR OF THE GAUTENG DIVISION, PRETORIA THE MINISTER OF PUBLIC ENTERPRISES First Respondent Care Of: THE STATE ATTORNEY SALU Building 316 Thabo Sehume Street PRETORIA ESKOM HOLDINGS LTD Second Respondent Megawatt Park, 1 Maxwell Drive Sunninghill, Sandton MR BRIAN MOLEFE Third Respondent 759 Camelford Road Cornwall Hill Estate Irene, PretoriaIN THE HIGH COURT OF SOUTH AFRICA [GAUTENG DIVISION, PRETORIA] caseno: 330S1/)7 In the matter between: DEMOCRATIC ALLIANCE Applicant and MINISTER OF PUBLIC ENTERPRISES First Respondent ESKOM HOLDINGS LIMITED Second Respondent BRIAN MOLEFE Third Respondent FOUNDING AFFIDAVIT |, the undersigned JAMES SELFE do hereby make oath and say: 1 | am the chairperson of the Federal Executive of the applicant, the Democratic Alliance of South Africa (“the DA”), and | represent it as a Member of the National Assembly of the Parliament of the Republic of South Africa. 2 1am duly authorised to depose to this affidavit on behalf of the DA. b8 3° The facts contained in this affidavit are within my personal knowledge, unless the context indicates otherwise, and are true and correct, to the best of my knowledge and belief, 4 Where | make legal submissions | do so on the advice of the Democratic Alliance's legal representatives. THE PARTIES 5 The applicant is the DEMOCRATIC ALLIANCE (‘DA’), a political party registered in terms of section 15 of the Electoral Commission Act 51 of 1996 with Its head office at Thebe Hosken House, cnr Breda and Mills Street, Cape Town. The DA is the official opposition in Parliament. The DA approaches this Court in terms of sections 38(a) and (d) of the Constitution, acting in its own interest and in the public interest. 6 The first respondent is the MINISTER OF PUBLIC ENTERPRISES ("the Minister’), cited in her official capacity and served care of the State Attorney, SALU Building, 316 Thabo Sehume Street, PRETORIA, within the jurisdiction of this Court. The Government is the sole shareholder of the shares in the second respondent and the rights attached to those shares are exercised by the Minister, The Minister made the decision to appoint and/or re-instate the third respondent to the position of Group Chief Executive in respect of the second respondent. 7 The second respondent is ESKOM HOLDINGS LIMITED (“Eskom”), a public company incorporated in terms of the laws of South Africa and in terms of section9 3 of the Eskom Conversion Act 13 of 2001, with registration number 2002/015527/06. Eskom’s head office is at 1 Maxwell Drive, Sunninghill, Sandton. 8 The third respondent is BRIAN MOLEFE, cited in his personal capacity at 759 Camelford Road, Comwall Hill Estate, Irene, Pretoria. Mr Molefe has purportedly been appointed and/or re-instated as the Group Chief Executive of Eskom by the Minister, on the recommendation of Eskom’s Board, which appointment (for the reasons set out below and to be advanced in argument) is unlawful and falls to be reviewed and set aside. OVERVIEW 9 This application is brought in two parts. In Part A, the DA seeks interim relief interdicting Mr Molefe from performing any duties and/or functions or receiving any benefits or entitlements deriving from or associated with the position of Group Chief Executive at Eskom pending the determination of the relief sought in Part B of the notice of motion. 10 In Part B, the DA seeks an order reviewing and setting aside the Minister's decision to appoint and/or reinstate Mr Molefe to the position of Group Chief Executive at Eskom. 11 Mr Molefe was the Group Chief Executive at Eskom. He resigned after the erstwhile Public Protector released her “State of Capture” report, in which he was implicated. He was employed at Eskom for two and a half years. ¢.12 15 10 The Eskom Board of Directors recommended to the Minister that Mr Molefe be paid R30 million in pension benefits. The Minister rejected the proposal. Instead, the Minister has accepted a proposal to reappoint or re-instate Mr Molefe to the position of Group Chief Executive because — according to the Minister herself - it “represents a significantly better value proposition to the South African fiscus". Because Mr Molefe's employment terminated when he resigned previously, the Fecent decision of the Minister purporting to “re-instate” Mr Molefe amounts to a fresh (purported) appointment of a Group Chief Executive at Eskom. The appoint ment/reinstatement of Mr Molefe is in breach of the requirements of the relevant legal framework and is irrational, ‘The Minister ought instead to have accepted neither the proposal of payment of R30 million in pension benefits to Mr Molefe, nor the proposal that he be reinstated to the position of Group Chief Executive at Eskom. If she had acted lawfully and rationally, we submit that the Minister ought instead to have rejected both options, for they were both unjustifiable and unlawful options. In the remainder of this affidavit | shall address the following: 15.1 Factual background, 15.2 Urgency. 15.3. The legal framework. 15.4 The unlawfulness of the Minister's decision. 15.5 The requirements for interim interdictory relief.FACTUAL BACKGROUND 16 On 2 November 2016 the Public Protector released a report entitled “State of Capture concerning an investigation into alleged improper and unethical conduct by the President and other state functionaries relating to alleged improper relationships and involvement of the Gupta family in the removal and appointment of Ministers and Directors of State-Owned Enterprises resulting in improper and possibly corrupt awarding of state contracts and benefits to the Gupta family's businesses. 17 The report made several references to Mr Molefe and made mention of “persistent allegations regarding an alleged cozy relationship between Mr Brian Molefe and the Gupta family’ (page 17 of the report). Because of its length, and in order to avoid unnecessarily burdening the papers, | have not attached a copy of the Public Protector’s report to this affidavit. However, a copy of the report will be made available to the Court at or before the hearing of this application if necessary or if requested. For the sake of brevity | attach only the relevant portions of the report listed below. 18 In summary, the report noted the following key observations or allegations regarding Mr Molefe’s relationship with the Gupta family and his previous employment at Eskom: 18.1 The Public Protector investigated alleges irregularities in the awarding of contracts by Eskom to Tegeta Exploration and Resources (“Tegeta’) and b18.2 18. 18.4 18.5 18.6 12 contracts awarded by Eskom to Optimum Coal Mine (‘Optimum’) (page 53 of the report). Mr Molefe was appointed as the Group Chief Executive of Eskom on 25 September 2015 (page 230 of the report). President Zuma’s son, Mr Duduzane Zuma, is a business partner of the Gupta family through an entity called Mabengela Investments (‘Mabengela’). Mabengela has a 28.5% interest in Tegeta. Mr D. Zuma is a Director of Mabengela. Members of the Gupta family and Mr D. Zuma have secured major contracts with Eskom through Tegeta. Tegeta has secured a 10 year coal supply agreement with Eskom to supply coal to the Majuba Power station. The entity has also secured contracts with Eskom to suppiy coal to the Hendrina and Amot power stations (page 86 of the report). There are persistent allegations regarding an allegedly cosy relationship between Mr Molefe and the Gupta family. Such allegations are backed by evidence (page 17 of the report). Mr Molefe is friends with members of the Gupta family. One member of the family noted that Mr Molefe is a “very good friend” and often visits the Gupta family home in Saxonwold (page 86 of the report) Between 2 August 2015 and 22 March 2016 Mr Molefe called Mr Ajay Gupta 44 times, while Mr Gupta called Mr Molefe 14 times (page 123 of the report). G19 20 13, 18.7 Between 23 March 2016 and 30 April 2016, Ms Ragavan made 11 calls and sent 4 text messages to Mr Molefe (page 123 of the report), 18.8 Mr Molefe can be placed in the Saxonwold area on 19 occasions between 5 August 2015 and 17 November 2015 (page 123 of the report). 18.9 Mr Molefe had a distinct line of communication between the Gupta family and directors of their companies. Mr Moiefe did not deciare his relationship with the Gupta family (page 303 of the report). 18.10 The Public Protector recommended that a judicial commission of inquiry be appointed to investigate the various allegations set out in the State of Capture Report. On 11 November 2016 Mr Molefe released a statement relating to the Public Protector’s report, In the statement, a copy of which is attached as annexure JS1, Mr Molefe indicated inter alfa that: “I have, in the interests of good corporate governance, decided to leave my employ at Eskom from 1 January 2017. | do so voluntarily...” (emphasis added) and “1 will ake time off to reflect bofore I decided on my next career move,” and “1 go now, because it is in the interests of Eskom and the public it serves, that | do so. On the same day Eskom released a statement entitled "Eskom GCE Brian Molefe voluntarily steps down” in which it announced “a decision by Eskom Group Chief Executive Brian Molefe to step down in the interest of good corporate governance”. | attach a copy of the statement as annexure JS2. bo ¢21 22 23 24 14 Also on the same day, the Minister published a statement entitled “Public Enterprises Minister Lynne Brown notes resignation of Brian Molefe” in which she indicated inter alia that she respected Mr Molefe’s decision to resign from Eskom. [attach a copy of the press statement as annexure JS3. On 16 November 2016, the DA announced that it would the following day lay criminal charges against Mr Molefe in terms of the Public Finance Management. Act 1 of 1999, the Prevention and Combatting of Corrupt Activities Act 12 of 2004 and the Powers, Privileges and Immunities of Parliament and Provincial Legislature Act 4 of 2004. | attach a copy of the press statement as annexure JS4, Shortly afterwards, on 30 November 2046, the Minister released a statement indicating inter alia that the Minister had approved the Eskom Board's recommendation to appoint the erstwhile Group Executive: Generation, Mr Matshela Koko, as acting Group Chief Executive of Eskom with effect from 1 December 2016. | attach a copy of the press statement as annexure JS5. On 4 January 2017 Mr Molefe departed Eskom. He was employed at Eskom for approximately two and a half years. His employment terminated by virtue of his resignation, which was accepted and confirmed by Eskom's Board and the Minister. All agreed that such termination was in the interest of good governance at Eskom. Having regard to the fact that Eskom, as a public entity using public funds and providing public services, is an organ of state, it is clear that all ‘concemed — including Mr Molefe, Eskom and its board, as well as the Minister, were agreed that Mr Molefe’s departure from office as Group Chief Executive vy2 26 2 15 was in the public interest. [I submit that this was plainly correct, for it was — and is — unacceptable, and contrary to the principles of sound public administration, that a person who is the subject of such serious allegations and concerns as are raised in the Public Protector’s State of Capture Report, which she recommended should be investigated by a judicial Commission of Inquiry, should continue in office until those allegations and concerns were propetly and fully investigated and satisfactorily resolved. This Is particularly so because the controversial transactions raised in the Report, and other future transactions, involving the expenditure of vast sums of public money, cannot - in an transparent and accountable system of governance - continue to be overseen and influenced by such a person under suspicion and investigation ] Eskom duly advertised the position of Chief Executive. The closing date for applications for the position was 20 March 2017. | attach as annexure JS6 an image of such an advertisement in a newspaper. Presumably Eskom proceeded to receive and consider applications for the appointment of a suitable person to that position. It was later reported that Mr Molefe received — or was to receive - a R30 million payment or “golden handshake” from Eskom. | attach as annexure JS7 an article published on the Sunday Times website on 16 April 2017 alleging that the payment had been made to Mr Molefe. ‘The DA requested Mr Molefe's employment contract on 18 April 2017 in terms of the Promotion to Access to Information Act 2 of 2000 but did not receive a response to the request. Ye28 2 30 16 On 23 April 2017 the Minister published a statement in which she indicated inter alia that she declined a proposal by Eskom to pay Mr Molefe a R30 million pension payout. She also indicated that: “| found the arqument presented by the Board on why the pension arrangement was conceived lacking in legal rationale, and it cannot be substantiated as a performance reward because Mr Molefe has already been granted a performance bonus for his contribution to the tumaround of Eskom.” and “| have instructed the Board to urgently engage Mr Molefe and report back to me with an appropriate pension proposal within seven days.” underlining added] attach a copy of the press statement as annexure JS8. On 13 May 2017 Eskom published on its website a statement by the Minister regarding the decision by the Eskom Board on the pension of Mr Molefe. | attach a copy of the statement as annexure JS9. The statement states as follows: “This week, the Board of Eskom briefed me on the outcome of its consultations with former Group Chief Executive Mr Brian Molefe following my request that the proposed pension pay-out to Mr Molefe be re-evaluated. Aftor considering various options, the Board proposed that Mr Molefe returns all monies received on his departure from Eskom on 1 January 2017 and is reinstated as Group Chief Executive with immediate offect. rms of the Board's al, Mr Molefe a to serve out the remainder of his original contract and to reconsider the terms of his cor that resulted in the 1sion arrangement. i believe that Eskom will benefit from the return to the helm of the man primarily responsible for the company’s tumaround in 2015/2016, and that the Board's sa/ ultimately represents a significantly better &31 32 value. proposal. to the South African fis than the previc 1 informed the Board | was satisfied with its re-evaluation process and recognised the merit in its proposal ~ on the proviso of its legality. However, this matter has raised an important broador issue relating to State Owned Companies. | have asked my Department to work with the State Owned Companies to ensure that the pension packages negotiated with Executives at State-Owned Companies are inline with the Cabinet approved Remuneration Standards. In a related development, the Board has briefed me on the status of the investigation into allegations of impropriety regarding Eskom's acting CE, Matshela Koko. The Board appointed a firm of attomeys to conduct the probe independently. The appointed firm has requested more tinte to complete its work. The Board Is of the view that this extra time should be granted. In the interest of the process, the Interim Group Chief Executive has decided to take leave until the investigation is finalised by mid-June. | support the Acting CE's decision. I would like to assure South Africans that the final investigative report will be transparently handled, and firm action will be taken against Mr Koko should evidence of wrongdoing be discovered. Finally, | would like to reiterate my call for a decisive investigation into allegations of maladministration raised in various reports, including the former Public Protector’s State of Capture report. Clouds of unproven allegations and counter-allegations are doing State Owned Companies and our country a great disservice.” (emphasis added) The remainder of Mr Molefe’s original contract term at Eskom would be two and a half years, as indicated by the Minister at a press conference on 13 May 2017. The original employment contract term was five years. Itappears therefore that Mr Molefe has been “reinstated” to the position of Eskom Group Chief Executive in order to “serve out the remainder of his original b18 contract’ because itis a “significantly better value proposition to the South African fiscus than the previous pension proposal”. 33 | am advised that the decision of the Minister to “re-instate” Mr Molefe on this basis is irrational and is non-compliant with the relevant provisions of the applicable legal framework. Therefore, the decision to re-instate Mr Molefe is unlawful and falls to be reviewed and set aside, URGENCY 2 4 This application has been brought on an urgent basis. 36 The Minister's reinstatement of Mr Molefe to the position of Group Chief Executive at Eskom came to light on Friday, 12 May 2017. Mr Molefe has been re-instated with immediate effect, and will thus return to employment at Eskom imminently 36 In Part B the DA seeks to review and set aside the decision by the Minister to reinstate Mr Molefe. On Molefe's own version, it is in the interests of Eskom and good corporate governance, and indeed in the public interest, that Mr Molefe no longer be employed at Eskorn, 37 Mr Molefe resigned from Eskom in order to clear his name after the allegations concerning his allegedly "cosy" (which implied inappropriate) relationship with o ¢ the Gupta family were made by the Public Protector.39 40 a 19 In his statement published on 11 November 2016 Mr Molefe stated categorically that it was in the interests of Eskom and the public that he resigns from Eskom. In its statement published on the same day Eskom noted that Mr Molefe was stepping down in the interest of good corporate governance and indicated that the decision was “understandable”. Also on the same day, the Minister indicated in her statement that she respected Mr Molefe's decision to resign. It is thus common cause between all the parties to this application that the re-instatement of Mr Molefe to the position of Group Chief Executive at Eskom is not in the public interest, in the interests of good corporate governance or in the interests of Eskom. itis therefore common cause that Eskom and the public would suffer harm if Mr Molefe were to remain in (or resume) that position. If Mr Molefe is permitted to return to the position of Group Chief Executive at Eskom for any period of time, the DA will be unable to obtain effective redress at a hearing in due course. That is so because the harm which will be caused to Eskom, to the public and to the interests of good corporate governance, by Mr Molefe's re-instatement will already have been done. Any finding in the DA’s favour at a hearing in due course will be unlikely to undo the harm caused to the South African fiscus and to the interests of Eskom and the public in the meantime. It is thus imperative that the relief sought by the DA be determined as quickly as possible in order to negate the imminent and irreparable harm to Eskom, to the public and to the interests of good corporate governance. This is particularly so20 in light of the allegations by the Public Protector in her report on state capture of an irregular relationship between Mr Molefe and the Gupta family. LEGAL FRAMEWORK 42 Eskom is a Major Public Entity listed in Schedule 2 of the Public Finance Management Act 1 of 1999 (‘PEMA’). 43 In terms of section 49(2)(a) of the PFMA, the Board of Eskom is its accounting authority. 44 Section 50 of the PFMA provides for the fiduciary duties of accounting authorities for public entities as follows: "60: Fiduciary duties of accounting authorities (1) The accounting authority for @ public entity must- (a) exercise the duty of _utmost_care_to ensure reasonable protection of the assets and records of the public entity; () act with fidelity, honesty, integrity and in the best interests of the public’ entity in, managing the financiel affairs of the public entity; () on request, disclose fo the executive authority responsible for that public entity or the legislature to which the public entity is accountable, all material facts, including those reasonably discoverable, which in any way may influence the decisions or actions of the executive authority or that legislature; and (4) seek, within the sphere of influence of that accounting authority, to prevent any prejudice to the financial interests of the state, (2) Amember of an accounting authority or, if the accounting authority is not a board or other body, the individual who is the accounting authority, may not-24 (@) act in a way that is inconsistent with the responsibilities assigned to an accounting authority in terms of this Act: or (b) use the position or privileges of, or confidential information obtained as, accounting authority or a momber of an accounting authority, for personal gain or to improperly benefit another person, (3) Amember of an accounting authority must- () disclose to the accounting authority any direct or indirect personal or private business interest that that member or any spouse, partner or close family member may have in any matter before the accounting authority; and () withdraw from the proceedings of the accounting authority when that matter is considered, unless the accounting authority decides that the member's direct or indirect interest in the matter is trivial or irrelevant.” (own emphasis) 45 Section 51 pf the PFMA provides for the general responsibilities of accounting authorities of public entities as follows: *81 General responsibilities of accounting authorities (1) An accounting authority for a public entity- (@) must ensure that that public entity has and maintains- () effective, efficient and transparent systems of financial _and_risk_management and internal control; (i) @ system of intemal audit under the contro! and direction of an audit committee complying with and operating in accordance with regulations and instructions prescribed in terms of sections 76 and 77; and (ii) an appropriate procurement and provisioning system which is fair, equitable, transparent, competitive and cost-effective; (i) a system for properly evaluating all major capital projects prior to a final decision on the (0) must take effective and appropriate steps to- () collect all revenue due to the public entity ce Ba22 (i) prevent irregular expenditure, fruitless and wasteful expenditure, losses resulting from criminal conduct, and expenditure not complying with the operational policies of the public entity; and (ii) manage available working capital efficiently and economically; () Is responsible for the management, including the safeguarding, of the assets and for the management of the revenue, expenditure and abilities of the public entity; (d) must comply with any tax, levy, duty, pension and aualt commitments as required by tegislation; (e) must fal five_and_appropriate_disciplina steps against any employee of the public entity who- () contravenes or fails to comply with a Provision of this Act; (i) commits _an_act_which_undermines_the financial management and internal control system of the public entity; or (ii) makes or permits an irregular expenditure or a fruitless and wasteful expenditure; () _ isresponsible forthe submission by the public entity of all reports, returns, notices and other information to Parliament or the relevant provincial legislature and to the relevant executive authority or treasury, as may be required by this Act; (@) _ must promptly inform the National Treasury on any new entity which that public entity intends to establish or in the establishment of which it takes the initiative, and allow the National Treasury a reasonable time to submit its decision prior to formal establishment; and (h) must comply, and ensure compliance by the public entity, with the provisions of this Act and any other legislation applicable to the public entity. (2) If an accounting authority is unable to comply with any of the responsibiiies determined for an accounting authority in this Part, the accounting authority must promptly report the inability, together with reasons, to the relevant executive authority and treasury.” (own emphasis)47 48 49 23 Section 3(1) of the Eskom Conversion Act 13 of 2001 provides that Eskom is deemed to be a public company incorporated in terms of the Companies Act 1973. ‘Section 6 of the Eskom Conversion Act provides as follows: 6 Memorandum and articles of association of Eskom (1) The Registrar of Companies, appointed in terms of section 7 of the Companies Act, must, on the date of conversion, register the memorandum and the articles of association of Eskom in terms of section 63 (1) of the Companies Act, but no fee is payable in respect of such registration. (2) The memorandum and the articles of association of Eskom must be as determined by the Minister. 3 The Minister may publish such articles of association in the Gazette for public comment and must table them before Parliament. (4) The Minister must enter into a Shareholder compact with Eskom Holdings Limited. (8) When entering into the Shareholder compact as well asin determining the articles of association, the Minister must take into account the following: (2) The developmental role of Eskom Holdings Limited; and (b) the promotion of universal access to, and the provision of, affordable electricity, taking into account the cost of electricity, financial sustainability and the competitiveness of Eskom.” | attach a copy of Eskom's Memorandum of Incorporation (‘MOI") as annexure JS10. In terms of the MOI, the Government is the sole shareholder of Eskom and the rights attached to those shares are exercised by the Minister. Clause 3.6 of the MOI provides that: "36 The Company [Eskom] shall not: 3.6.1 appoint to or remove a Director from the Board: or 924 3.6.2 appoint or remove the Chairperson of the Board, Group ‘Chief Executive or Group Chief Financial Officer other than {as provided for in terms of this MOI.” (own emphasis) 50 Clause 14.3 of the MO! provides that: “14.3 Process of appointment and removal of the Group Chief Executive 14.3.1 The Shareholder shall, on behalf of the Company, have the exclusive power, in exercising its Ownership Control pursuant to the provisions of sec 63 (2) of the PFMA, to appoint and remove the CE as an employee of the Company in accordance with the Guidelines 14.3.2. The Shareholder may request the Board to. identify, nominate and evaluate _ potential candidates for appointment as the Group Chief Executive in accordance with the Guidelines and to submit a shortlist of candidates to the Shareholder to assist tho Shareholder with the appointment. 14,33 The Shareholder’s act of appointment of the Group Chief Executive binds the Company to the exclusion of the Board. 14.34 The Minister shall be noted as a party to any contract of employment between the Company and the Group Chief Executive. 14.3.5 The Group Chief Executive shall report to the Board and shall only become an executive Director of the Company if appointed to the Board by the Shareholder in terms of clause 14.1.1 of this MOI. 14.3.8 The Shareholder shall, on behalf of the Company have the exclusive power to remove the Group Chief Executive as an employee of the Company which removal would constitute a dismissal as envisaged in terms of Section 186(1)(a) of the Labour Relations Act 66 of 1995 (“LRA’). Consequently, the provisions of the LRA apply to any such removal.” 51 The Eskom Pension and Provident Fund (“EPPF”) is a defined benefit pension fund that is registered as a self-administered pension fund in terms of the Pension Funds Act 24 of 1956 and approved as a pension fund in terms of the Income Tax Act 58 of 1962. | attach a copy of the Revised Rules of the EPPF (in b52 53 54 55 25 relevant part) as annexure JS11. A complete copy of the Rules can be made available to the Court at or before the hearing of this application if necessary or if requested. ‘The Rules provide for the calculation of member contributions in section 17. Rule 17(1) provides that every member shall contribute to the fund 7.3% of their pensionable emoluments. Rule 21 (1) provides that Eskom will contribute to the fund up to 13.5% of their pensionable emoluments, Eskom will contribute to the fund 12.25% of their pensionable emoluments with an addition 1.25% of the pensionable emoluments of certain employees Rule 23 provides that a member who has attained a pensionable age (65) shall tetire from the service and cease to be a member. Rule 24 provides that the annual pension payable to a retired member shall be 1,085/600 of their final average emoluments per month of pensionable service. Mr Molefe has not yet reached pensionable age. Rule 24 provides for early retirement as foliows: "24 Notwithstanding the provisions of rule 23, a MEMBER may retire from the SERVICE after attaining the_age of 55 years, in which case he shall be entitled, as from the date of his retirement, to a PENSION in respect of his PENSIONABLE SERVICE to the date of retirement calculated in terms of rule 22 reduced by a factor equal to thirteen-fortieths of one per cent for each month by which the period from the date of his retirement to the date on which he would have attained the PENSIONABLE AGE exceeds twenty-four months...” BE26 56 Mr Molefe could not have taken early retirement as he has not turned 55 yet. Mr Molefe is currently 50 years old. Therefore, Mr Molefe could not have retired or taken early retirement. He did not purport, at the time, to take early retirement, nor could this have been done legally. The evidence — in particular the statements of Mr Molefe himself, Eskom and the Minister- shows that Mr Molefe did not take early retirement, but that in fact he resigned. 57 Therefore, Rule 30 is applicable. Rule 30(1) 1. provides as follows: “RESIGNATION 30(1) 1. Subject fo the provisions of subsection (2), ifa MEMBER resigns_volunterily from the SERVICE before attaining PENSIONABLE AGE, or leaves the SERVICE for any reason other than those detailed elsewhere in these rules, he shall, subject to the provisions of rule 40, be entitled fo a benefit equal to the amount of his ACCUMULATED CONTRIBUTIONS; provided that the payment of a resignation benefit for MEMBER'S [sic] aged 55 years and older shall be subject to the South African Revenue's Services General Note 4 and or any other General or Practice Note es shall be published by the South African Revenue Service from time to time, 2. ‘Ifa MEMBER becomes ented to a benefit in tons of this rules, he may elect instead that the BOARD shall pay to him_an amount not exceeding the amount which can be faken as a tax-free withdrawal benefit in terms of the Income Tax Act, and that the balance of the actuarial valuo in respect of his SERVICE, as determined by the ACTUARY be deemed to be @ voluntary contribution made by him on the date of leaving the SERVICE, Provided that in such circumstances the MEMBER shall become a DEFERRED PENSIONER and his deemed voluntary contributions shall be dealt with in terms of the provisions of rule 18(7).” (own emphasis) 58 “Accumulated Contributions” are defined in the Rules as “the MEMBER'S CONTRIBUTIONS with interest determined at such rates and on such basis as, bt59 61 27 acting on the advice of the ACTUARY, the BOARD may from time to time determine’. “Contributions” are defined in the Rules as the “amounts paid or payable by a MEMBER to the FUND, exclusive of interest and exclusive of contributions paid in terms of rule 18". Rule 37(2) provides that "No person shail have any claim concerning the FUND either upon the FUND or against the BOARD or an EMPLOYER except in accordance with these RULES." The following is clear from the factual background and legal framework set out above: 61.1 Mr Molefe resigned from Eskom, His resignation was accepted by the Minister, and his position was advertised. In addition, an acting Group Chief Executive was appointed by the Minister. 61.2 Despite the employment relationship between Mr Molefe and Eskom coming to an end and steps being taken to appoint someone in his place, the Minister has sought to resuscitate the employment relationship and “re-instate” Mr Molefe without following any forma! appointment process. 61.3. She does so purely as an alternative to paying Mr Molefe a R30 million pension because, according to her, it would be a ‘significantly better value proposition’, ly ¢28 61.4 In terms of the EPPF Rules, however, Mr Molefe is only entitled to his accumulated pension fund contributions because he resigned voluntarily. Its highly unlikely — if not inconceivable - that Mr Molefe’s accumulated contributions would amount to R30 million in approximately two and a half years, Therefore, Mr Molefe could not have been entitled to a R30 million Pension payout. This is reinforced by the fact that the proposal for the R30 million payout was never claimed (at least in the public statements released) to be an automatic entitlement but rather a mere Board proposal requiring the Minister's approval. If | had been an automatic entitlement, there would have been no need for or basis for the Minister's approval. In any event, the Minister cannot lawfully approve @ payment of pension benefits which is not in accordance with the EPPF rules. Those rules cannot be interpreted to entitle Mr Molefe to anything of the order of a R30 million payout. 61. an Even if Mr Molefe were somehow arguably entitled to such a high pension Payout (which we deny), the EPPF Rules make no provision for Mr Molefe's reinstatement as an alternative to receiving a pension payout 62 Accordingly, the Minsiter's decision to appoint and/or reinstate Mr Molefe to the position of Group Chief Executive at Eskom is unlawful and falls to be reviewed and set aside on the grounds which are set out below.29 THE DECISION IS UNLAWFUL 63 The Minister's decision to appoint Mr Molefe to the position of Group Chief Executive at Eskom is unlawful on at least two grounds: 63.1 First, the Minister is not empowered to do so by the relevant legal framework and empowering provisions. 63.2. The appointment of Mr Molefe is irrational because it is not rationally connected to the purpose for which it was taken. The Minister has acted in breach of the relevant empowering provisions 64 The Minister's “te-instatement” of Mr Molefe breaches the provisions of Eskom's: MOI and the EPPF Rules. 65 The Minister's decision purports effectively to appoint Mr Molefe afresh to the position of Group Chief Executive at Eskom, The Minister has, in doing so, purported to resuscitate an employment relationship which was terminated voluntarily by the employee, Mr Molefe — by his resignation, which was accepted and confirmed, and acted upon. 66 The Minister has failed to comply with the requirements and guidelines in Eskom's MOI in respect of the appointment of a Group Chief Executive. 67 In addition, the provisions of the EPPF Rules do not provide for re-instatement ‘of employment as an alternative to receiving a pension payout. The only io ¢68 69 30 alternative to receiving a pension benefit which is provided for in the EPPF Rules is contained in Rule 30(2). In terms of that Rule, a member may instead elect to receive a different amount, comprising an amount not exceeding an amount which can be taken as a tax-free withdrawal benefit in the terms of the Income Tax Act and a balance deemed to be a voluntary contribution. Therefore, the Minister is not empowered unilaterally to re-instate Mr Molefe’s terminated employment contract as an alternative to payment of an unacceptably high pension benefit due to him. In any event, Mr Molefe does not appear to be entitled to a pension benefit of R30 million. Mr Molefe’s pension benefit must be calculated in accordance with the EPPF Rules. 69.1 Mr Molefe is entitled to a pension benefit equal to the amount of his accumulated contributions because he resigned voluntarily. 69.2 Accumulated contributions are the member's contributions with interest. 69.3 Rule 17(1) provides that in respect of member contributions, every member shall contribute to the fund 7.3% of their pensionable emoluments. 69.4 It is inconceivable - and it is specifically disputed - that Mr Molefe's accumulated contributions could lawfully amount to R30 million over the period of two and a half years at which he was employed at Eskom as the Group Chief Executive.3 70 The Minister is not empowered to appoint Mr Molefe to the position of Group Chief Executive at Eskom as an alternative to payment of a pension benefit to him, She has further breached the relevant empowering provisions by appointing Mr Molefe without following the correct process and guidelines. 74 However, even if Mr Molefe's appointment arguably did not breach any empowering provisions, his appointment is nevertheless irrational and falls to be reviewed and set aside on that basis too, an aspect to which we now turn. The Minister’s decision is irrational 72 | am advised that the Minister's decision constitutes an exercise of public power and must therefore be rational. The Minister's appointment of Mr Molefe to the position of Group Chief Executive is irrational. 73 lam advised that in order to be rational the Minister's decision must be rationally related to the objective sought to be achieved. 74 The Minister has indicated that the objective of appointing Mr Molefe is to ensure a better value proposition for the South African fiscus. His appointment however is not rationally related to benefitting the South African fiscus. On the contrary, the appointment of Mr Molefe to the position of Group Chief Executive is harmful to the South African fiscus. 75 _Itis common cause —and particularly apparent from the statements issued at the time of his resignation by Mr Molefe himself, Esklom’s Board and the Minister - i76 7 78 32 ‘that the re-instatement of Mr Molefe to the position of Group Chief Executive at Eskom is not in the public interest, in the Interests of good corporate governance orin the interests of Eskom. Nothing has changed since the public statements were made, to change that fact. Therefore, the re-instatement of Mr Molefe cannot be beneficial to the South African fiscus. This is particularly so where Mr Molefe has no entitlement fo the R30 million payout. ‘The re-instatement of Mr Molefe is thus inimical to the purpose for which the Minister re-instated him. The decision of the Minister to appoint Mr Molefe to the position of Group Chief Executive at Eskom is thus irrational. The Minister acted irrationally in choosing to reinstate Mr Molefe as an alternative, "better value proposition’. The Minister has stated publicly that she “cannot support” the Eskom Board's proposed pension payout for Mr Molefe. She stated on 23 April 2017 that: “I found the argument presented by the Board on why the pension arrangement was conceived lacking in legal rationale, and it cannot be substantiated as a performance reward because Mr Molefe has already been granted a performance bonus for his contribution to the tumaround of Eskom. Nor is the proposed pension payout justifiable In light of the current financial challenges faced not only by State- Owned Companies (SOCs), but by the country as a whole.” The Minister therefore had a third alternative —- which was the only realistic rational option - available to her in considering the Board's proposal of a R30 million pension payout. Given that there was no legal rationale for the pension arrangement and it was unjustifiable, the Minister could have, and should have, simply refused to approve the pension arrangement. There is no rational reason why the Minister was required to find a “better value proposition” or alternative 479 80 81 33 solution fo an unlawful proposal. The correct approach ought to have been for the Minister to refuse approval of the pension payout proposal outright, without any reinstatement or re-appointment. If the R30 million pension proposal had no legal rationale and was untawful, it could not properly be regarded as constituting a burden on the South African fiscus, nor could any reinstatement of Mr Molefe be regarded rationally as a “better value proposition”. There was no obligation on the Minister to incur either burden on behalf of Eskom. Therefore, the Minister's decision to reinstate Mr Molefe as an alternative to an unlawful pension payout is irrational, Itis unclear from the public statements which have been issued, as well as media reports which have been published, whether Mr Molefe may in fact already have received part or possibly all of the R30 million payout ~ despite the fact that there is no lawful basis for it, and in any event approval was never granted for the proposed payout by the Minister. The Respondents are called upon to clarify the true factual position in this regard. To the extent that any such payment has been made, it was unlawful and should be repaid forthwith, An appropriate prayer for such repayment is included in the Notice of Motion THE REQUIREMENTS FOR INTERIM RELIEF (NOTICE OF MOTION PART A) 62 | am advised that in order to be successful in an application for interim interdictory relief, the DA must establish that it has a prima facie right, that it has a reasonable &34 apprehension that it will suffer irreparable harm if relief is not granted, that the balance of convenience favours the granting of interim relief and that it has no satisfactory alternative remedy. Each of these requirements is addressed in tum below. Prima facie right | am advised that the DA has established a strong prima facie right to review and ‘set aside the decision of the Minister to appoint and/or reinstate Mr Molefe to the position of Group Chief Executive at Eskom on the basis that the decision is unlawful and irrational. Reasonable apprehension of irreparable harm 84 85 It is common cause that it is in the interests of Eskom and good corporate governance, and indeed in the public interest, that Mr Molefe no longer be employed at Eskom. Therefore, it is common cause that there is a reasonable apprehension that harm will ocour to Eskom, the public interest and the interests of good corporate governance if Mr Molefe continues to be employed at Eskom. Mr Molefe resigned from Eskom in order to clear his name after the allegations concerning his allegedly cosy (that is, improper) relationship with the Gupta family were made by the Public Protector. He has not yet done so, nor has he ‘sought to review the Public Protector’s report. Therefore, there is in addition still @ reasonable apprehension, based on the as yet uncontradicted observations of the Public Protector in her state capture report, that Mr Molefe may have an by86 87 88 3 inappropriate relationship with the Gupta family from which the Gupta family may stand to benefit at the expense of Eskom and the public purse. In a press conference on 13 May 2017, the Minister herself indicated in response to a question from a reporter regarding whether Mr Molefe had her support, that “Well, | mean, | can't give anyone unequivocal support. I say you come back, you do your job well, when you prove your job well done then | give you my support.” It is thus apparent that even the Minister cannot yet give full support to Mr Molefe's appointment, but instead intends to allow him to prove himself. If Mr Molefe is permitted to return to Eskom as the Group Chief Executive, his ‘employment in that position will present a significant threat to the good corporate governance of Eskom. Mr Molafe resigned from Eskom in order to clear his name, but he has not yet done so. The allegations of an itregular relationship between Mr Molefe and the Gupta family remain unchallenged. The Minister herself has reiterated that the Public Protector's report calls for an investigation into Mr Molefe's conduct. Mr Molefe's role as Group Chief Executive at Eskom has already been marred by controversy and allegations of impropriety. By his own admission his continued employment at Eskom would be detrimental to the entity's good corporate governance. Therefore, Mr Molefe's reinstatement at Eskom jeopardises the good governance of the entity by exposing all future exercises of power and performance of functions by Mr Molefe to the same scrutiny and potential for 9 unlawfulness.36 89 If it is found that Mr Molefe acted unlawfully in the exercise of any of his powers or performance of any of his functions as Group Chief Executive at Eskom at a later stage, it may be difficult or impossible for the Board or the Minister to correct, rescind or change any unlawful decisions or actions by Mr Molefe. 90 It is unconscionable and inappropriate that a Group Chief Executive should continue to perform functions and exercise powers while he is under investigation. The decision of the Minister to reinstate Mr Molefe presupposes ‘that he will resume his duties and will not be suspended pending investigation, This itself contravenes principles of good governance, and is inimical to the requirements and spirit of the PFMA, as well as the basic values and principles governing public administration laid down in s 195 of the Constitution of the Republic of South Africa, 1996. 91 The Public Protector and the Minister have called for full investigations into transactions overseen by Mr Molefe. The reinstatement of Mr Molefe to the position of Group Chief Executive places Mr Molefe in a position to frustrate or obstruct any such investigations against him, 92 The reinstatement of Mr Molefe also directly contravenes the fiduciary duties of the Eskom Board as the accounting authority for the entity. By reinstating a Group Chief Executive whose name has not been cleared and requires investigation, and who is by his own admission a threat to the good governance ‘of Eskom, the Board would not be acting in the best Interests of the public entity. G37 93 The Board would further fail in its general responsibilty to maintain effective, efficient and transparent risk management systems within Eskom, or its responsibility to take appropriate disciplinary steps against an employee who has undermined the financial management of the entity. The Minister has already indicated that Mr Molefe will be required to return all monies received by him from Eskom since his departure on 1 January 2017. The Board will be obliged to enforce that obligation, which will further jeopardise the good governance of the entity by creating a conflct of interests between the Board and the Group Chief Executive. 94 - Therefore, ifinterim relief is not granted and Mr Molefe is reinstated as the Group Chief Executive at Eskom, the Board will have been permitted to breach its fiduciary and general duties twice — first by entering into an unlawful agreement in terms of which Mr Molefe sought a R30 million pension payout and then by reinstating Mr Molefe to the position of Group Chief Executive, There is thus a reasonable apprehension that Mr Molefe's reinstatement may cause irreparable harm to Eskom's good governance. The balance of convenience favours the granting of interim relief 95 If interim interdictory relief is granted, Mr Molefe will be prevented from performing any duties and/or functions or receiving any benefits or entitlements deriving from or associated with the position of Group Chief Executive at Eskom. 96 Mr Molefe voluntarily resigned from the same position at Eskom last year. On his own version, Mr Molefe’s resignation was in the interests of Eskom, the interests ly7 38 of good corporate governance, and the public interest. That fact remains unchanged. If interim interdictory relief is granted, the status quo (Mr Molefe's voluntary resignation from Eskom) will be maintained. On the other hand, if interim interdictory relief is not granted, Mr Molefe will be reinstated to the position of Group Chief Executive at Eskom, a state of affairs which Mr Molefe agrees will not be in the interests of Eskom, good governance or the public. No satisfactory alternative remedy 98 99 In terms of Eskom's MOI, the Minister has the exclusive power to appoint and remove the Group Chief Executive as an employee of Eskom. The MO! makes no provision for any challenge to such a decision. The DA thus has no alternative but to approach this Court for relief. WHEREFORE the DA prays for an order as set out in the notice of motion. densercesSae ber. JAMES SELFE | hereby certify that the deponent knows and understands the contents of this affidavit and that to the best of her knowledge both true and correct. This affidavit was signed and sworn to before me at CAPE TOWN on this the_!S@2«_ day of MAY39 2017, and that the Regulations contained in Government Notice R.1258 of 21 July 1972, as amended, have been complied with. ISSIONER OF OATHS HUGO JOHAN DE WAAL Practising Advocate Keerom Street Chambers 56 Keerom Street Cape Townte JS | STATEMENT ‘On Wednesday 2 November 2016, a report entitled ‘State of Capture’ prepared by the former Public Protector, Advocate Thuli Madonsela, was released, The report did not make any findings. Instead It made what were termed “observations”, based, (the report acknowledged), on an investigation not completed. It deferred a proper investigation to 2 commission of inquiry to be established at a future date. The outgoing Public Protector has directed the President — in whom the Constitution vests the power to appoint commissions of inquiry - to appoint one, and further directed the Chief Justice to designate a particular judge to head it. Itis a matter for regret that the report was prepared in haste to meet a deadline related to tthe Public Protector’s own departure from office. That her office continues, asall State offices do, and that any uncompleted function is completed by a successor In that office, was not a consideration in the report. “Observations” made In the report relating to, Inter alla, my conduct, are in material respects Inaccurate, based on part-facts or simply unfounded. What the previous Public Protector has Gone Is not herself to investigate to completion, or to allow her office to complete what she Initiated too tate to complete herself. She has also determined ori recording “observations” without, In crucial respects, putting intended harmful disclosures to me first ~ as she was by Jaw required to do, She has effectively deferred my constitutional right to be heard toa future date, and to a further body, which she has ordered others to assemble, |fsuch a body is indeed by law to be assembled, and carry out the task, It will not be for some. time ~as recent experience indicates. {n the meanwhile harm is done—to the institution it has been my honour to lead in the most difficult times, to its reputation and to my own. | say nothing of the harm, too, to others close tome. am confident that, when the time comes, | will be able to show that I have done nothing ‘wrong and that my name will be cleared. | shall dedicate myself to showing that an injustice. hhas been done by the precipitate delivery of ‘observations’, following an incomplete Page 1 of2 &Investigation, which the former Public Protector has drawn back from calling ‘findings’. The truth will out. have, in the interests of good corporate governance, decided to leave my employ at Eskorn from 1 January 2017. | do so voluntarily: indeed, | wish to pay tribute to the unfailing support have had since | took up office from the chairman, the Board and with those with whom it has been my privilege to work. Together we brought Eskom back from the brink. { wit take time off to reflect before | decide on my next career move. wish to reiterate that this act is not an admission of wrongdoing on my part, Itlsrather what | feel to be the correct thing to do in the interests of the company and good corporate governance. | wish to thank the shareholder representative, Ms Lynn Brown, the board, the executive team ‘and all Eskorn employees for their hard work and guidance In steering the company out of very difficult times during the twenty months that 1 was privileged to be the Group Chief Executive. | go now, because It Is in the Interests of Eskom and the public It serves, that | do so, Brlan MOLEFE 14 November 2026 Page 20f 2sano? stom GCE Blan Moe velar steps dun Le. see tabyeah f \ @€skom | eee world oS a Eskom GCE Brien Molefe voluntarlly steps down 1 Novamber 2016: wil » grea sense of oss and cept that tho Board of Eskom announces a dacaon by Eakore Group Chief Execulve Bran ‘jee to sep down Inthe Iuarost of good carpaale govemance. Inn aft to ler his name folowing tho release of formes Pubic Prclct: TnuE Medonsela's report on her “observations” about te socalled sate ‘captur, Mr Molafe hes decid to voluntary stap down to reflec nd take ms ol Eskom chairs Bali Nitride decison ken by Me Nolte wae regretible but undersiaidai ‘Since jlang Eskom in Ap/4 2015, Mr Malate and his executive manegomn! tem have lrnad around the compere operational and Fnac ‘perlomence, wih 18 mons of no load shedding, te impactol welch has been enjoyed by every South Alcan elven. ‘Tho improved performance of he pose goneraling units coupled wit adltoral capac fom some of our naw bul projects has resuted In @ sible power fyalem, with excess copacy boing exported lo naighboving slates, ‘The company's quly poslion has also improved signiicanly, wth qué easels Increasing by 84.0% fom R241 bllon a year ego, lo RAS dion at '30 September 2016 la the tace cf CPI gro repeted tobe 6.1% os st 1 Api 2016, The roup has access lo edqual eaoutcee el facies ‘continue 8s # gong concer orto foreseeable aura, ‘Tho Eskom Board sincarely hanks Eran Miele for his rlantios dacication o tuning Eskom ound, slying a capable execu learn end puting hon @ sound gown raectary, kam wil soon be announcing the ier eadorshiperangemanis ence agreed wth our Shareholder Representve, the Honaurable Mister Lyon Brown. eNOS (om company oot ty Ss enagy ‘sana Cot Contact Subscribe 06 00 eK ‘Sibsee to the Eskom ter ‘ea 0 sat Femeneetit Crime Line ‘sus rie eke ve Ln: 0880 182722 Webcasts Comments esac rr cna Customer Service others cen Otome etn SHRI Ang Hote ‘hut imho ‘Nip:hnneskom.co2shasPageeNovttC ape weaura Departmental bic Enlrprisas public enterprises are! (GD) Ee es, RerUUC oF SOUTH AFRICA Ta ‘ome > Heaters > Mtr Bren dcnes Bin Hale's person pay-out Minister Brown declines Brian Molefe’s pension pay-out zayeyn017 ister Brown decines ran Hole’ pansion pay ut 2y017 ‘The Mister cf Pic Enterprises, ts yane Broom ha ced Esko pepo ops arma ‘Group Chie secre, Me Brian Meet, «R30 ion persion pao. “nove coneered te Estom Boards easing formula Be prepoed poson payt and «arect soporte "fund the argument preset by tha Gourd on why the person rangement was conceived ‘acing in ge rationale, ard canna be subarea mpfr ear bce Me olete nes seas bon ranted @ pesfeance bonus or conto oe taaroud of Fon "Wor the ropes person payout stibie n ht fhe caren franca challenges faced not iy by Sate net Compares (SOC), ty the curry as 2 oe “1 havein he pat ashes Eskom ag the oh fe OCs i my polo to demonstrate facial ‘prudence ana sot eosin when cotieing earn enue. chen hat is not party oe conrecf enpoynert coe been te Esa Board ‘0d Hr Molt, Tha insta te Goad to wrgeny engage Mr Mole nd repr ecko me ‘wih an apoterae pension rope in Seven cs. “Us wnforsate Wat seh a sense and pena mater was handle rest "inl, {have asked the Boat espn how proposal go ote pubic dora porto ‘my hoxng ad the opportune constr Hkser Browns For ene ona Cala Croyagen on 062277946, sb the rosy of Public ners 23 4002017 a ii nie nt Conta dae osha dpe go 2anawarcom Papen ter-Brown-dchnes- Gren MceliE2 60800 -paslan-py-et sep tt=S DA to lay charges against Brian Molefe by Democratic Alllance - Date: 16 November 2016 Release: Immediate ‘Type: Media Advisory Tomorrow, Thursday 17 November 2016, DA Shadow Minister of Public Enterprises, Natasha Mazzone MP, will ay criminal charges against the CEO of Eskom, Brian ‘Molefe in terms of the PFMA and Prevention, Combatting of Corrupt Activities Act and the Powers, Privileges and Immunities of Parliament and Provincial Legislatures Act ‘We cannot stand by as those in positions of power are allowed to abuse state institutions for their own selfish gain and to the detriment of South Africans. Itis now time that he is brought to book and these charges are a step towards ensuring that this happens, Date: Thursday, 17 November 2016 Time: 13:00 Location: Cape Town Police Station, Buitenkant Street. There will be an opportunity for interviews and photographs. Media Enquiries Democratic Alliance Luvuyo Ndlangisa Prass Oficer (067 738 0812S os LS JSS Hane abene yn Tot orga81 F118 160 Fax 012681 1038 Prva Bap HOOT, Cae Town O00 Par O21 45 281, MINISTRY PUBLIC ENTERPRISES. REPUBLIC OF SOUTH AFRICA To: All Media Date: 30 November 2016 For Immediate Release Minister Brown approves the appointment of Matshela Koko as Eskom’s Acting Group CEO The Minister of Public Enterprises, Lynne Brown, has approved Eskom Board's recommendation to appoint the current Group Executive: Generation, Mr Matshela Koko, as ‘acting Group Chief Executive of Eskom (AGCEO) with effect from 1 December 2016. The appointment follows the resignation of Mr Brian Molefe, earlier this month as Group Chief Executive Oficer of the company. “L approved the Board's request to appoint Mr Koko as acting Group Chief Executive Officer. Mr Koko has @ wealth of experience and understands the challenges Eskom faces. His appointment will also ensure continuity at Eskom. | have also asked the Board to immediately start the process to appoint a permanent Group ‘CEO and that this process needs their urgent attention, Mr Koko must ensure that the current trajectory at Eskom continues,” said Minister Brown. Condensed CV of Mr Koko Mr Koko is the current Group Executive: Generation. He joined Eskom in September 1996 ‘@s an Engineer-in-Training and has moved steadily up the ranks. Other positions he ‘occupied included Boller Plant Engineer Manager and Pressure Parts Engineer (2000), Senior Manager: Power Plant Engineering, Enterprises Division (2004); Senior Manager: Enginsering, Generation Division (2008). Divisional Executive: Group Technology (2010); and Group Executive Technology and Commercial (2014). For enquiries cantact Colin Cruywagen on 082 3779916 Issued by Ministry of Public Enterprises 30 November 2016 bmioht and (5:8 M sity. Iiemploy®.) if revenues of R153 ting £0 Ie. jnman of the:B 1g leadership and finstarr ‘SUNDAY TIMES. Grin Meteo scares 0m payout ram Es rae ‘soon ff aso IS t if Ve i Loon umsome |] LE | ue} NEWS OPINION & ANALYSIS SPORT BUSINESS LIFESTYLE TRAVEL DECOR FASHION & BEAUTY — FOOD Durban's new butterfly habitat garden is the J perfect place to chill out ‘ Nestseom > Miter Grown dels Brian Mele’ pension py-ot ; S ¢ pension pay-out ion07 inst’ Brown decane Wan Helfe's person payout Byeapo17 “he inter of Pt Etre, Me nme Brn, hs Seales Eskom’ propo to pay omer Group Cre! Ercue, Mr Sian Nae, 2 C-allen pani pay “hve considered Ue Eso Boat’ reson nora the promeed pension payout and arwet sport. our the argument prserel by Ue Board on te pen arrangement Was cone acing tn kegs ratints, ant cannat be stants 5a performance ere becave i ele hes already beer gare petomance bons for Na certian the marand of ton “Wri the proposed pension payout usb n ht of te cuvet ancl chalnges faced net ‘ony by Se Oe Companies (SOC), ta yf caus 2 whe “Tbave inthe past asd sam aad theo five SCs in my orto odemerstrae franca srudece and sill erste when ensderng ecu ealumes. “Glen tat vas ota party ote contract of erpioymentconduded bebrean te Eskom Board ‘ond Molt, have nsvucted he Boed to pen enage Hr Nef and report ackto me ‘itn an spropte pension proposal win seven des “tes urfomate ti such 8 seni onprae attr ibs hn 0 rece, “Final, howe astes te Board oes Spte hs ropsa oe mo the pe dispar rnyhag hed he epprunty io cnr” Mister en si For engries conic Cola Guptagen on 08 377916 son by the Mit of Pb reins 23 2007 Mon serio Owe nk Coot dae p:hrdpa go 2ahsroorVPageMirst- Brown cine Molle KEZECEA0- persion pey-o.x Minister Brown declines Brian Molefe’s tewar ‘Serene Miata cf Pc reise 7 ee Se} Powering your world To \ skom 1 YO ey S G Statement by the Minister of Public Enterprises oun hi tract yee Bom rhea y ema dont hina he pm 8 Mea ‘wre tone teehee cemtann ep te YH aie lh pi egy Mee eee ‘vanish toe ier tsene nt eel oe at tert tent cn eA het pene rae ‘Senn tbh ont ten then Be me yr mo oe ai 0:09 EN ele ee are bet ‘ryt etre rep th mpm vy Sa Oa Cape fen pad Inst eseacens hn tment naga inept ae tine Mepis ral are wea ete cpauten ha wn aerate nat abanabar te cents cabo Seldsrdans beens alt Pecss ae aue eo ey civ analy saad sae sheen, nebo So a tl nena ad od an an ah gn shee wn be rook Fou vote eee ne wei gel aeintn nadine i en RA ee Ee! pt po Creer eno otennteahpten ovssnstocndtonpn adore ymtieee erate ont nero t IE. 8 ‘he (Tia oemehetertd os ‘ux Coimpany Peal ectty Tensore Sar ener meats Contact, ‘Subserbe G6 OD ESKON ‘Severo stam nantes Ful Contain rime Line sts Tl Fee ae nes 0 1327 22 ss. ose Webcasts Comments amubecies secacc oe Wate conerrontonGotinnense og tute costnareanontpetennen ‘pth eskom.co2atnawePages ayy tapeJS10 | ras abrmaen cree Incorporation was submitted and acjopted by Special Resolution passed by the Sharcholder of tho ‘Company on 4 Joly 2046 and Initial by the Chairperson for the purpose of identification. @E€skom MEMORANDUM OF INCORPORATION OF ESKOM HOLDINGS $C LTD Registration number: 2002/015527/30 Wich Is state-owned company, may have up to 15 drectr(s) who shall nol be enttled to appoint alternate directors, Is authorised to issue securities as descrlbed in clause 6, and is referred fo Ini the. ‘rest of this MO! as “the Company". This MOI Is in a form unique to the Company, as contemplated in section 13 (1) (a) () of the Companies Act 71 of 2008, as amended, ‘Adoption of MOI ‘This MOI was proposed by the Board of the Company ih mecordance with section 16 (1) (c) () (a8) and was adopted by Special Resolution passed by the Shareholder of the Company on 1 July 2046 in accordance with section 16 (1) (c) (i) in substitution for the existing MO! of the Company in aécordance wih section 16 (6) (a) and lilialled by the Chraitperson for the purpose of identiication, Preamble ‘The Company is a pre-existing company as contemplated In Item 2 of Schedule 6 of the Companies ‘Act and was incorporated in accordance with the Enabling Legisiaion to-carry on the business of providing erisrgylelectricty and related services, including the generation, transmission, distribution ‘and retall thereof, I boing recorded that the Company is also subject fo the provisions of the PFMA. ‘The Government is the sole Shareholder of the Shares In the Company and the rigs attached to those Shares are exercised by the Minister. This. Memorandum of -thcorpofation regulates: the Company and Is relationship with ils Shareholder, subject fo the provislons of the Legislative and Pally Framework,Document | 240- MEMORANDUM OF INCORPORATION, Sdentiier —fessazeso | REY JO ‘TABLE OF CONTENTS (Clause number and description Page 1 INTERPRETATION... 2 _ INCORPORATION AND NATURE OF THE COMPANY AND GOVERNING PROVISIONS.. 3. PURPOSE, POWERS AND CAPACITY OF THE COMPANY. 5 THE MAKING OF RULES 6 AUTHORISED SHARES IN THE COMPANY, ALLOTMENT AND ISSUI 7 PRE-EMPTION ON ISSUE OF ORDINARY SHARES .. 8 PROHIBITION REGARDING BENEFICIAL INTERESTS. 9 RESTRICTION ON THE TRANSFER OF SHARES .. 10. TRANSFER OF SECURITIES. 11 SHAREHOLDER'S AND DIRECTORS’ RIGHT TO INFORMATION... 12 RECORD DATE. 48. SHAREHOLDER’S MEETINGS AND ROUND-ROBIN RESOLUTIONS. 14 DIRECTORS... 418 FINANCIAL ASSISTANCE AND BORROWING POWERS OF THE COMPANY AND COMPANY'S SUBSIDIARIES... 418 PERSONAL FINANCIAL INTEREST AND DECLARATION BY DIRECTORS... 17 INDEMNIFICATION AND DIRECTORS’ INSURANCE... 48 AUDITOR: 19. AUDIT COMMITTEEMEMORANDUM OF INCORPORATION Document | 240- Identifier | 65347859 a 23 26 26 NOTICES... 27 FINANCIAL YEAR... ete ‘ew dd bn ec npn pn et en wy NEB ‘SOCIAL AND ETHICS COMMITTEE, BOARD COMMITTEES. PRESCRIBED OFFICERS. COMPANY SECRETARY. DISTRIBUTIONS TO THE SHAREHOLDER... ACCOUNTS... WINDING UP... ‘SUBSIDIARIES... PROTECTION OF WHISTLE-BLOWER' ‘taeda tte ‘oper ecm saben it nv weet De ake, mes SOC Rg Ne AONE GZ,MEMORANDUM OF INCORPORATION pore 240- Identiier | 65347859 4 INTERPRETATION In this Memorandum of Incorporation- 14 12 124 122 123 124 126 126 127 128 129 1.2.40 12 42.42 12.43 12.134 142432 CCaplalised words that are not defined in this MO! will bear the same meaning in the Companies Actor the PFMA, unless the context provides otherwise. Unless the context provides or requires otherwise, the following words and expressions bear ‘the meanings assigned to them and cognate expressions bear corresponding meanings: ~ “Ad Hoc Committee” means an ad hoc committee established by the Board from time fo time for @ specific task oF objective and dissolved after the completion of the task or the achievement of the objective; ‘Administrator’ means the person appointed by the Shareholder in terms of clause 3 of this MO}, “Approval of the Shareholder” means @ written notice from the Shareholder to the Company recording the Shareholder's approval of a matter or a copy of a Shareholder's resolution granting approval of « matte, “Auditing Profession Act” means the Auditing Profession Act, No. 26 of 2005; "Board’ means the “board” of the Company from tims to time, as defined In the ‘Companies Act, which Is also the Accounting Authority for purposes of the PFMA; “Business Day" means any day other than a Saturday, Sunday or official puble holiday inthe Republic; “"Group Chief Executive” means the group chief executive of the Company; “Group Chief Financial Officer” means the group chief financlal officer of the Company; "Companies Act’ means the Companies Act, No. 71 of 2008 as amended, consolidated orre-enacled from time to time and includes al schedules thereto and the Regulations; "Company" means Eskom Holdings SOC Lid, Registration no, 2002/018627/80 or ‘whatever other name itmay be known by from tie to time; “Company In gonoral mooting’ means a formal meeting of, or a resolution passed by, the Shareholder; “Consultation/Consult" means a formal engagement requested by one party, at such time, in such manner and at such place agreed to between the partes, having fist provided the other party, in writhg, with such relevant informetion as the parly might reasonably require, Including Information that the party may speciically request, to alow the party to consider the matter upon which the party is being Consulted. "Corporate Plan’ meane the three-year plan of the Company as contemplated in the PFMA tead with the Treasury Regulations, regulatory framework as set out in the Eleclriclty Regulation Act, Companies Act and other legislation governing and prescriting the role and functions of the Company, which plan must include (but is not Emited to): ~ strategic objectives and outcomes Identified and agreed on by the Shareholder in the ‘Shareholder's Compact strategic and business initafives 2s embodied in business function strategies;(MEMORANDUM OF INCORPORATION aral|ee et Wdentitier 65347859 | 12.133 1.2434 42136 12.138 42.137 124874 4.21372 424873 12.18.74 1218.76 12438 42.44 12.16 1.2.46 12.47 12.48 1.2.19 1.2.20 12.21 1.222 1223 ‘ey performance measures and indicators for assessing the Company's performance in delivering the desired outcomes and objectives; arrisk management plan; a fraud prevention plan; the SMF; 2 financial pian addressing — quarterly projections (forthe first year) of revenue, expenditure and’ borwings against annual targets; asset and liabllly management; ‘cash flow projections; ‘capital expenditure programmes; and dividend policies; ‘such other Isstes as may be required in terms of the PFMA from time to tim *Dollver’ means in the manner in which the Company Is entiled to give notice or deliver documents in accordance with clause 26 ofthis MO! and the Companies Act, including ‘Table OR3 of the Regulations, and “Delivered” and “Delivering” shall have the corresponding meaning as the context may indicate; “Directors” means the “dreotors' of the Company from time to time, as defined in the Companies. "Directive" means the directive gWven by the Shareholder in terms of clause 3 of this MOI in which the Shareholder slates the stops to be undertaken to remedy a situation contemplated in clause ** and which wil include the reasons for issuing the directive and time within which the steps must be taken; “Distribution” means a “distribution” as defined in the Companies Act and “Distribute” ‘and “Distributed shall have the corresponding meaning as the context may indicat “DoA" means the Delegation of Authority Framework approved by the Board from time to {ime governing the principles and conditions upon which the Board shall delegate euthority; “Effective Datot with reference to any particular provision of the Companies Act, means tho date on which that provision came into operation in terms of section 225 of the Companies Act othervise the dale set oul as the Effective Dale in the Shareholders! resolution adopting this MOK “Eloctronic Address" means in regard to Electronic Communication, any emall address furnished to the Company by the Sharehokler, “Electronic Communication’ has the meaning set out in section 1 of the Electronic Communications and Transactions Act, No. 25 of 2002; “Enabling Legislation” means the Eskom Conversion Act, No. 13 of 2001 as amended (oF any legislation that replaces I “Exeo" means the members of the Execulive Management Committee of the Company ‘rom fime to time; ‘nance manent yp, xm ra te pny A Or evae aR oe fwareibeenen” ep ein desea yb pot vat une csectie cop bt Eto es S A ap ENA HETIOO SG f‘MEMORANDUM OF INCORPORATION Document | 240- Adentifier 65347858 Rev |0 12.24 1.225 1.2.28 12.27 1.228 1229 1.2.30 1231 1.2.32 1.2.36 4237 1.2.38 1.2.39 1.2.40 "Ex Officio Director” means an "ex officio director” of the Company from time to time, ‘as defined in the Companies Act, *Financtal Assistance” has the meaning set out In section 45(1) of the Companies Act “Financial Year has the meaning set out in clause 27 of tis NOI; “Gazette” means the Government Gazette of the Repub; “Goverinent” means the Government ofthe Republic: ‘Guldelines” means the ‘guidelines for the appointment of a Chief Executive for a State ‘Owned Enterpriae’ as lesued by the Minister from time to time “ineligible or Diequaliied” means Ineligbte or cisquallfied as contemplated In the section 69 of the Companies Act or as contemplated in clause 14.43 of thls MOI which shall apply not only to Directors but etso to mombers of Board committees and Prescribed Officers; “Law” means any law of general application, as amended and re-onacted from time to time, and includes the common lav, constitution, decree, trealy, ordinance, bylaw, arder, regulation or any other enactment of legislative measure of government (reluding local and provincial government) statutory or regulatory body which has the force of aw, "Legislative Framework” means the legislalve and regulatory framework fram time to time in force vibich relates to or affects the Company including, the Companies Act, the PEMA, the Nellonal Treasury Regulations, the Enabling Legislation, National Energy Regulater Act, Eletly Regulation Act, the Naonal Nuclear Regulator Legilaion and Roguations and any and every other Law, which ralates to or affects the Company; ‘Material’ means "material as defined In the Companies Act, *Momorandum of Incorporation’ or *MOI* means this Memorandum of Incorporation of the Company, as amended from time to time; “Minister” means the Minister of Public Enterprises In her/his capacity as the representative of the Government and the Executive Authorlly (as defined In the PFMA) ‘of the Company, of if any other Minister is designated as belng the representative of the Government or the executive authoriy, then thal Minster acting in such capacity; *Month’ means a calendar month; *Noties” means notice in wiling and delivered according to the provisions of the MO! ‘end mare particulary the provisions of clause 26 of the MO}; office” means the registered office of the Company; “Ordinary Resolution” means a resolution adopted with the support of more than 50% (ity per cent) of the Voting Rights Exercised on the resoliion at a Shareholders Meoting, of by the Shareholéer acting olher than al a meeting, as contemplated In section 60 of the Companies Act; “Ownership Contro!”, in relation to the Company, means the ability of the Shareholder, Jn accordance with the provielons af ection 1 of the PEMA, to exercise any of the following powers to govern the financial and operaling policies of the Company in order to obiain benefits from its activities: scams cate ns utero coat ony print tnd cn tear, on Helge 9001 ap Ne ODS2790 2Ss Document — | 240- MEMORANDUM OF INCORPORATION enter lessavaso [RY | O 1.2.40.2 to appoint or remove the Company's CE; 1.2.40.3 to castal, orthe majorly of, the votes at meetings of the Board; 1.2404 tocontio all, or 2 majatity of, the voting rights al a gener meeting ofthe Gompany. 1.241 “Person includes a Juistic Person; 1.2.42 "PEMA" means the Public Finance Management Act, No. 1 of 1999, as amended; 1.243 “Polley Framework” means any and every , directive, guideline, framework, or policy , {rom tine to time In force concerning and affecting the Company or its Subsidlarles and the relationship botween the Shareholder, the Company and the Board from time to time and which comprise, without imitation, the Strategie intent Statement, the Shareholder’s Compact, the SMF, the Corporate Plan, Governance Codes of Good Practice and Protocol's from time to time, the Delegation of Authority Framework and the SMF. 1.244 “Proscribed Officers” means @ person who, within a company, performs any function that hes besn designated by the Minister of Trade and Industry tn terms of section 66(10) ofthe Companies Act which, forthe avoidance of doubt, Includes any member of Exco; 1.245 “Prosont” shall have the meaning ascribed to the term "present at a meeting” in the Companies Act; 4246 "Public Audit Act” means the Pubic Auclt Act, No. 25 of 2004; 4.247 Regulations" means the regulations published pursuant to the Companies Act from {ime to time; 1.248 ‘Remuneration Policy’ means the Remuneration Policy of the Company which wilt Incorporate any "Remuneration Guklelines" andlor "Standards" published by the Minister ‘rom time to ime which will be confirmed by the Compeny on an annual o biennial basis, a contemplated in clause 13.1.1.9 ofthis MO}; 4.249 “Republle” means the Republic of South Arica; 4.2.60 *Revenuo Fund” has the meaning set out in section 1 of the PEMA; 1.2.51 “Round Robin Resolution’ means a resolution passed other than at a 12.814 ‘Shareholder's Meeting, whlch = 125144 was submitted for consideration to the Shareholder; ancl 128142 was voted on in Welling by the Shareholder or by a duly authorised representative on behalf of he Shareholder, within 20 (twenty) Business Days after the resolution was submited o the Shareholder as contemplated n eection 60 (1); 4.2512 meeting of Dkrectors, n respect of which 78% (seventy five per cont) of the Directors voted on in Weitng by signing a resolution, within 10 (fen) Business Days after the ‘resolution was eubrnitted to them as contemplated In section 74; 4.2.52 “Soourtios* means “secures” as defined in the Companies Act 1.2.53 "Securities Rogistor” means the register of Issued Secures ofthe Company required tobe established in terms of section 60(1) of the Act and referred to In clause 8 hereof; 4.264 "Shareholder" means the Government represented by the Minister; 12.65 "“Shareholder's Compact” means the agreement, entered into pursuant to the Treasury Regulations, between the Shareholder and the Board annualy; ‘oun dona ene duane range, dom mors 8 EA HSS NA Hee TOA cones aaonen aera agetefeedomctnn Depend bad en cnt nc hn Ht SCL ap ORRINMEMORANDUM OF INCORPORATION MWdentifier 65347859 ea 1.258 1.2.87 1.2.58 1269 1.2.60 1261 12.62 12.63 1.2.86 4.2.05 4.266 13 134 132 13.3 134 *shareholdor’s Mesting" means with respect to any particular matter concerning the Company, a meeting of the Shareholder who Is entiled to Exercise Voting Rights in relation to that matter, ‘shares means one ofthe units Into which the proprietary interest of the company is divided and lasusd, orto be issued, by the Company; *Sign’ and “Signature” Include, respectively, tthography, printing, electronic signature or signing by a mechanical or electronic process or means; “significance and Matoriality Framework” or "SMF" means the agreoment between the Minister and the Compary for the purposes ofthe PEMA, in particular sections 61, 4 and 65 thereof and pureuant to Treasury Regulations, in particular reguiallon 28:3.1 thereot, which sets out a framawaik of levels of significance and materiality applicable to certaln matters and transactions and the process that must be followed for authorisation by the Executive Authority, “Special Resolution” means a resolution adopted with the support of al least 75% (evenly fve per cont) of the Voting Rights Exercised on the resoluton al a Shareholders Meeting or by the Sharcholder acting other than at a meeling, as contemplated in section 60 of the Companies Act “Standing Committea” means a permanent committee of the Board with a continued ‘xistence established by the Board or in acoordance with the Legislative or Policy Frameworks to deal with a specified set of duties. This excludes Ad Hac Committees; “Strategie Intent Statomant” means the primary tool used by the Shareholder to communicate ks expectations of the Company stralegy and which contains tho ‘Company's strategic purpose, scope of business, core business, coneuitallon thresholds ‘ investment strategy developed by the Shareholder in consultation with sector departments, National Treasury and the Presidency of the Republic and taking into ‘account an assessment of the interaction between the policy and regulatory environment with the financial and operational goals of the Company to ensure shareholder value ‘optimisation and achievement of wider socio-economic objectives; *Subsldlary" means a ‘subsidiary’ of the Company, as such term Is defined In the Companies Act; “Treasury Regulations” means the regulations made by the Nationa! Treasury of the Repubilc In terms of section 76 of the PFMA and any amendment thereof or substitution therefor from time to time: “Voting Rights’, wilh respect to any matter to be decided by the Company, means the rights of the Shareholder to vote In connection with that matter; and writing” includas Electronic Communication. In this MOI, unless the context cloarly indicates otherwise: Words Importing the singular number shal include the plural number and vice versa. Words importing any one gender chall include the other two genders. ‘Words importing natural persons shall include Juristc Persons (whather corporate or not and including partnerships and trusts) and vice versa, References to the Shareholder entiied lo vole Present at a meeting or acting In person shall include the Shareholder represented by duly authorised representativels (which ‘vou outta cepa Ws Geman mente sl aremendty ns Nee AR een naan opto donned bo pohent Ona wed set ete opr hn, an He SOGAM ap RATETTOG Document | 240+ 7 oeMEMORANDUM OF INCORPORATION Document | 240- Identiier | 66347859 135 13.6 137 13.8 138 13.10 13.41 13.12 14 18 18 org 18 uly authorised representatives may be natural or Juristic Persons) as contemplated in {his MOI or acting in the manner prescribed in the Companies Act Reference to a section by number in this MO! shell be a reference to the corresponding section in the Companies Act and or the PFMA, as applicable, unless otherwise stated. A reference to a ciause by number refers (o a corresponding provision of this MOI. (Clause headings are for convenience only and ara not to be used In ks interpretation. Reference to any provision of any Law shall Incude such provision as amended oF fe- ‘enacted from time to fine and includes any subordinate legislation made from time to {ime under such Law. Any reference to a particular section in a Law ie to that section a8 al the date of adoption of this MOI, and as amended or re-enacted from time to time and/or an equivalent measure in 8 Lew, provided that if as a result of such amendment or re-enactment, the specific requirements of a secton referred to in this MO! are changed, the relevant provision ofthis MOI shall be read aiso as It had bean amended as necessary, without the necessity for an aclual amendment, ‘Subject to the preceding clause, any words or expressions defined in any Law shal, unless the context otherwise requires, bear the same meaning In this MOI aé in the Law in which they are defined. If any tefm Is defined within the context of any particular clause in the MO), the term so defined, unless it's clear from the clause in question that the term so defined has limited application to the relevant clause, shall beer the meaning ascribed tof forall purposes in terms of this MOI, notwithstanding that that term has not been dofined in this interpretation provision. Reference to @ Shareholder represented by @ proxy shal indtide a Sharcholder represented by () an agent eppointed under a general or special power of altomney; or (P) ‘the Minister. ‘Any reference to @ notice shall be construed as a reference to a Writen notice, end shall Indude a notice which is transmilited electronically in e manner and form permitted in terms of the Companies Act andor the Regulations, If the Companies Act Is amended at any time to confer any right or benefit on the ‘Company, then this MOI sha be deemed to have been amended 0 as to result in the ‘Company enjoying the full beneft of any such amendment to the Companies Act, “The rule of construction that a contract shal be Interpreted against the party responsible for the draiting or preparation of the contract, shall not apply to this MOI. “The words "include", including” and “In particular shall be construed as being by way of ‘example or emphasis only and shall net be construed, nor shal they take effect, as iting the generality of any preceding wordls. ‘The words ‘other and “otherwise shall not be construed eiusdom generis with any preceding words where a wider construction is possible. ‘Any reference in this MOI to eny other agreement or document shall be construed as a reference to such other agreement or document as same may have been, or may from time fo time be, amended, varied, novated or supplemented. Unless specifically otherwise provided, any number of days prescribed shall be determined by exchiding the fist and including the last day or, where the last day falls on a day thats. not a Business Day, the next succeeding Business Day. ‘nan ceent oho oe cme toa ta nares even UAT RUN AEE octet tageobeurer 6OMEMORANDUM OF INCORPORATION eee 240- Wdentiier | 65347850 1.9 Where figures are referred to in numerals and in words, and there Is any conflict between the two, the words shall prevall, unless the context indicates a contrary intention, 4.10 This MOI shall be deamed to authorise the Company to do anything which the Act empowers a Company to do If so authorised by Rs MO! unless that authorly Is expressly excluded. 2 INCORPORATION AND NATURE OF THE COMPANY AND GOVERNING PROVISIONS 24 dutlstle Personality 214 The Company fsa pre-exlsting company as defined in the Companies Act and, as such, Continues to exist as a public company as I thas been Incorporated and registered in terms of the Companies Act, as contemplated In Nem 2 of Schedule § ofthe Act, and this. MOI replaces and supersedes the MOI of the Company applicable immediately prior to the fing hereof, 24.2 The Company was registered and incorporatod on 1 July 2002 In terms of the Enabling Legislation and operates as a Stale Owned Company as defined in Section 1 of the Companies Act being sted as a major public ently in Schedule 2 of the PEMA, 22 Governing Provisions ‘The Company shall be governed by: 224 the unalterable provisions of the Companies Act subject to: 2244 ‘any higher standards, greater restrictions, longer perlads of time or more onerous, requirements set out in this MOI in accordance with section 18(2)(a)()); and. 2242 ‘any exemption granted In accordance withthe provisions of section @; 222 the alterable provisions of the Companies Act (subject fo any negation, restriction, limitation, qualification, extension or other alteration set cut in this MO! in accordance ‘with section 15(2\a)()); and 22:3 the provisions of this MOI (subject to and in accordance with section 16(2); and 224 the provisions ofthe Legistative Framework; and 22.8 the provisions of the Polley Framewark. 28 Conflicting Provisions withthe Companies Act in any instance where there is an Inconsistency elween a provision be It express or tac, ‘of the Companies Act and: 234 Aprovision of he PFMA then: 2344 the provision of both the Companies Act and the PEMA apply concurrently, to the ‘extent that is possible to apply and comply with the one inconsistent provision without ‘contravening the second (section 6 (4) (a)); and 2342 to the extent that It is impossible to apply or comply with the inconslatent provi ‘without contravening the second the applicable provision of the PFMA shail prevall ‘exept to the extent provided otherwise In sections 30 (8) or 49 (4) as provided for in section 6 (4) (a) of the PEMA, ‘incon enantio ath ‘a pat ceaseatnnyba poe bu ho myaedrod cop hn, ae lrg COOL Me enn &MEMORANDUM OF INCORPORATION Document | 240- aly Kdentier | 65347859 2382 24 2A4 242 24.3 244 24h 24a 24Ad ‘a provision ofthe Policy Framework the provision of the Companies Act shall apply to the ‘evtont it has nol been altered by the MOI in which case the provisions of clause 2.4.4 of the MOI shal apply. Conflicting Provisions with the MO! In any instance where there Is @ conflict betwoon a provision, be It express or tact, ofthis Mol and: fan unalterable provision of the Companies Act; the unalterable provision of the Companies Act shall prev ‘an allerable provision of the Companies Act: the provisions ofthis MOI shall prevail; and ‘a provision of the PFMA: the provisions of the PFMA shall prevail; and a provision of the Polley Framework: the provisions of this MOI shalt prevall, provided ‘hat i: the provision of the Polcy Framework simply adds to but is not inconsistent wilh this MO} or the provisions of this MO! provide for the Polley Framework to preval’ or the Companiés Act doos not requlre the MO! to take precedence over that provision of the Polley Framework; the provisions of the Polley Framework shall prevall, 3. PURPOSE, POWERS AND CAPACITY OF THE COMPANY at a2 a24 322 33 34 38 ‘The objective of the Company is to provide energyletectrilly and related services, Inciuding the generation, transmission, distdbutlon and retal thereof. In doing so it has ail the powers, 0 Implement this mandate subject to any limitalions set out herein, the Sharcholder’s Compact, the Strategic Intent Statement and any other limitations imposed by the ‘Shareholder. In fulfling is obligations, It's specifically ecknowiedged that the Company has ‘a developmental role and will through Its actives promote transformation, economic development, broad based black economic empowerment and may support relevant ‘national initiatives. In addition to the Strategle Intent Statement which shall be Issued by the Shareholder by 30 April each year, the Shareholder may, after Consultation with the Board, require changes. to the mandate and objectives of the Company f+ Itis reasonably necessary to de 20; or tis in the best interest of the Company. ‘The Company ls not eubject to any restrictive conditions or prchibitions contemplated In sation 45(2) (6) oF (0): ‘The Company has, subject to section 19(1)(b)(), all of the legal powers and capacity of an Individual which are not subject to any restrictions, limitafions or qualications, as contemplated in section 19(1)(b)(0); Notvathstanding anything to the contrary contained hereln or any omissions from this MOI of any provisions to that effect, the Company may do anything that the provisions of the pate ‘hcl on demesne tis eon ned pie beeen AEP bees vege bert Ga No putet doormat pce wa oe act banana ees SCL ge 080078 (MEMORANDUM! OF INCORPORATION Document | 240- Identifier | 66347059 36 364 362 az 38 384 382 383 384 39 3a4 392 393 3.10 3.40.1 3402 34024 340.22 an St ann Logislative Framework or the Policy Framework empower I to do tf not exprossly prohibited In terms thereof, ‘The Company shall not: appoint fo of remove a Director from the Board; or appoint or remove the Chalrperson of the Board, Group Chief Executive or Group Chief Financlal Officer other than as provided for in terms of this MOI. It is specifcaly recorded that only the Shareholder, in exercising its Ownership Control In terms of section 63 (2) of the PFMA, may appoint or remove Directors in acoordence with the provisions of section 66 (4) (a) ()of the Companies Act; ‘Tho Shareholder may direct the Company fo take any action specified by the Shareholder if the Company: 's in financial diffcully or is being mismanaged; falls to perform Its functions effectively or efficlenty, ‘has acted unfaity or In a discriminatory or inequitable way towards @ person to whom it ‘owes a duly under the Legislative or Polley Framework; has falled to comply with any law or any policy envisaged in the Legislative or Policy Framework; A Directive contemplated In clause 9.6 must state in writing: the reasons for issuing the directive; the steps which must be taken to remedy the situation; and ‘a reasonable period within which the steps contemplated in clause 2.9.2 must be taken. UW the Company falls to comply with the Directive as contemplated in clause 3.8 within the ‘stated petiod, the Shareholder may: fatter having given the Company a reasonable opportunity to be heard and after having afforded the Company a hearing on any submissions received, intiate an Investigation Into the matter in accordance with terms of reference determined by the Shareholder; and Jor where circumstances so require, appoint 2 person as Administrator to assume responeibilly for and to ensure uitiment of the Directive to the extent as may be further determined in writing by the Shareholder from time to time.. the Shareholder appoints an Administrator In terms of clause 9.10.2.2: the Administrator may do anything which the Company might othenwise be empowered ‘oF required to do by oF under the Leglslallve or Policy Framework and this MO! to the excluslon of the Company and any ofits directors, officers or employee: the Board may not, while the Administralor is responsible for fulling the Directive, exetolee any of lis powers or perform any of its duties relating to the Directive or matters Incidental thereto;ee 4 MEMORANDUM OF INCORPORATION, ent assarese | POY 3.41.8 a direcior, officer, employee or a contractor of the Company must comply with a directive given by the Caretaker, 3.12 The Sharehokier shal: 3.12.1 review the performance of the Company regularly whilst It is undor administration of the ‘Administrator; and 3.12.2 wile the Intervention continues, review the Intervention and the performance of the ‘Administrator regularly; anc 3.12.3. within sh months or any shorter pertod of ime as may be determined by the Shareholder In weling, of appointing the Administrator and thereafter at Intervals of every three months, , table a report on the Administrators findings in the National Assembly. 3.13 Once the siluation has been remedied to the satisfaction of the Sharehoider and the Company is able to perform its functions effectively, the Shareholder shall terminate the appointment of the Administrator, 3.44 Notwithstanding clause 3.10, the Shareholder may dissolve the Board ifthe Sharaholder, on | dood cause shown, loses confidence in the abllly of the Board to perform its functions effectively and efficiently, The Shareholder may dissolve the Board only: 3.14.1 afterhaving glven the Board a reasonable opportuniy tobe heard; and 3.44.2 after having efforded the Board a heating on any submissions rocoived. 3.48 Ifthe Shareholder dissolves the Board, the Shareholder 3.45.1 may appolnt an Administrator (o take over the functions of the Board and! to do anything \which the Board might olherwise be empowered or required to do by or under this Act, subject to such conditions as the Minister may determine; and 3.45.2 shall, as soon as its feasible but not later than three months after the dissolution of the Board, replace the members ofthe Board in the manner as contemplated inthis MOI. 3.18 The costs associated with the eppontmert of an Administrator shall be for the account of the Company. 3.47 The appointment of the Administrator terminates in accordance withthe provisions of cause 3.18 or when a new Board Is in place in terms of cause 3.16.2, 3.18 Ifthe Board, any of ts members or any officer or employes of the Company Is alleged to have committed financial misconduct ae contemplated in Chapter 10 of the PFMA then the Shareholder must initiate an investigation into the matter and if the allegations are confirmed, the Sharehoker must ensure that appropriate disciplinary proseedings are Inlited iremediately. 3.49 Notwithstanding this section, the Shareholder retains the right et any time to approach @ ‘competent court fr relief in any mailer the Shareholder considers appropriate, 3.20 The Company shallnot, without the prior Walten approval of the Shareholder: 3.20.1 enter into any transection which exceeds or falls outside of the limits presoribed by the Shareholder's Compact or the SMF; 320.2 establish or participate in ~ spate oorainny Dope a eaten! Bn can Est rs SOC I Rg ERTMEMORANDUM OF INCORPORATION Document | 240- Identifer | 65347859 3202.1 3202.2 3203 3.204 3.206 3206 3207 3208 3.20.8 the establishment of a company, or a significant partnership, trust, unincorporated Joint venture or siiar rangement; acquire or dispose ofa signficant shareholding In @ company or 2 significant asset, commence or cease a significant business actly; ‘commit the Company or its Subsidiaries to borrowings which confer rights to a fender to ‘convert debt into Shares of any kind; undertake or agree to a significant change In the nature or extent of the Company's Inferest in a significant partnership, trust, unincorporated joint venture or similar arrangement, approve the candidate nominated by Board forthe positon of the Issue, or approve the transfer of, any Shares in the Company, and subject to clauses 4,1 and 4.2 below, amend the provisions ofthis MOI. provided that the provisions of the PEMA are not contravened. 321 In addition to the limtalions and restrictions set out in clause 3.6 and 3.20 above, the Board B24 322 321.8 322 shall eneure that — the proposed Board-approved Sharehotler's Compact forthe folowing Financial Year to be submited to the Shareholder by 30 September of each year; the annual budget, the Corporate Plan and the Shareholde’s Compact of the Company hall be prosonted andlor submitted to the Shareholder prior to 28 February of each year; and tho Company discloses to the Sharcholder all changes to terms and conditions of trade which may have a Material impect on the Company. ‘Subject al all imes to the PFMA, the Shareholder may, in exceptional cumstances specly ‘any Kmitations regarding the general authority of the Company to ralse or borrow funds from {ime to time for the purposes of the Company, or secure the payment of such sums provided that the borrowing programme in terms of the Sharehokder’s Compacts not affected. 4 AMENDMENTS TO MOI 4A 42 Save for correcting patent errors in speliing, punctuation, reference, grammar or similar defects on the face of the MOI, which the Board is empowered to do, all other amendments of the MOI shall be effected in accordance with section 16(1) of the Companies Act and the provielons of this MOL ‘The Board shall publish a notice of any alleratlon of the MO! correcting a patent error In speling, punctuation, reference, grammar or similiar defect on the face of the MOI on the ‘Company's wobsite, furnish a copy of the alteration to the Shareholder, and file the notice of ‘such alteration as contemplated in section 17(1) of the Companies Act, 6 THE MAKING OF RULES ‘The Board is prohibited from making, amending or appealing any rules contemplated In section 45(3) of the Act and the Board's capacity to make such rules is hereby exciuded, nena ane cars rama ier Os emit old nbamapecanyre ewes ae hi ‘Scudeeebe To pett ocad myb ponced hed Neel eo Seopa bser Em et SOC! ao EDA TIC 6S b,Document | 240- ‘MEMORANDUM OF INCORPORATION denver lesgaveco | [FY [2 6 AUTHORISED SHARES IN THE COMPANY, ALLOTMENT AND ISSUE 6.1 Authoriged Shares In the capital ofthe Company GAA Subject to the Enabling Legislation, tne Company is authorised 10 Issue no more than +100 000 000 000 (one hundred billion ) ordinary Shares of no par value and the same class, which shall rank par! passu in all respects and each such ordinary Share entlles the ‘Shareholder to: 6.44.1 altond, participate in, speak at and vole on any matter fo be considered at any meeting of the Shareholder, 6.1.1.2 vote on any proposal to amend the preferences, rights, fiitations end other terms associated with that Share; 6443 participate proportionally in any Distribution made by the Company to the Shareholder, e144 participate in Distributions fo the Shareholder, oats recelve proportionally the net assets of the Company upon Its liquidation/dissolition; and 8146 Exercise any other rights attaching to the ordinary Shares in terms of the Companies ‘Act or any other law. 62 At the date of this MOI, there are 83 000 000 004 (eighty three bition and one) ordinary ‘Shares in Issue. The Issued ordinary Shares are held by the Sharehokier. 63 The Board shall not have the power to amend the authorisation (Ieluding iereasing of decreasing the number) and classification of Sheres (including determining rights and preferences) as contemplated in section 36(2)() read wih section 36(8) of the Companies Act 64 Subject to provisions of the Companies Act andl the Enabling Legislation, the Company may {rom time to time by Spocial Resolution passed by the Shareholder: - 64d incroaso or decrease the number of ts authorised Shares; 64.2 reclassify eny Shares that have been authorised but not Issued; 64:3 classify any unclassified Shares; 64s create any class of Shares and establish any preferences, rights, limitation or other terme in respect of any class of Shares 90 created, in terms of section 37 of the Companies et; 64.5 alter the provislons of this MOI with respect fo the objects and powers of the Company; 64.6 —_convert any Shares in the Company to Shares of a different ciass, whether lesued or not, and in particular (but without derogating from the generality of the aforegoing) convert ‘ordinary Shares or preference Shares to redeemable preference Shares, provided that ‘moneys other than dividends due to the Shareholder or the amount payable on the iw nnn ecm nape i fm ety mr a thane deanna pa etn cme et aOR, te eas SOG A ey Ho DOE GMEMORANDUM OF INCORPORATION Document — | 240- ual identifier | es347859 ear 65 6a4 662 653 68 87 redemption of any proference Shares shall be held in tust by the Company indefinitely ‘unt tawrtully clalmed by the Shareholder; and ‘to the extent that the Company Immediately before the Etfecive Date has authorised but unissued per value Shares in its capltal of a class of which there are Issued Shares, Issue the unisstied Shares of that clase at par or at 2 premium or ata discount. ‘The Board shall not have the power to Issue: - authorised Shares as contemplated In section 38 of the Companies Act; ot ‘options relating fo the alfotment or subscription of authorised Shares or olher Securities and secured and unsecured debt instruments as contemplated in sections 42 and 43 of the Companies Act; or ‘capltasation Shares or offer a cash payment in Feu of awerding @ captalisation Share in accordancs with section 47 ofthe Companies Act, ‘without an Ordinary Resolution ofthe Shareholder. Certicates of Securities The Securities issued by the Company shall be evidenced by certificates, which shall contain the information specified in section 51(1) of the Companies Act, and which shall be: Issued in the manner prescrbed in section 54 of the Companies Act. pee ‘The Company shali establish and keep a register of Is Issued Securites at its Office in the manner epecified in section 60 of the Companies Act 7 PRE-EMPTION ON ISSUE OF ORDINARY SHARES. TA TAA TAD 743 744 TAS ae ‘nent an esr te Ue eam ented ey ie rien ah Save f~ ‘ordinary Shares are to be Issued for the acquisition of any asset or for an Amalgamation or Merger; {he Shareholder by Ordinary Resolution approves the Issue of ordinary Shares for any ‘other purpose without this clause applying; « capitalisation issue of ordinary Shares is tobe undertaken; ‘ordinary Shares are to be ieeued In terms of option or conversion rights; ordinary Shares are to be Issued for a subscription price which Is not @ cash amount payable in full on subscription, the Shareholder has 8 right, before any other Person to be offered and within @ reasonable time, fo subscrbe for all the ordinary Shares to be Issued. The offer to the Shareholder shall be Delivered in Wrilng specifying the number of ordinary Shares offered, and ‘specifying atime (which shall not be less than 14 (fourteen) Business Days after the date of the off) by which the offer must be accepted and the requisite portion ofthe subscription prise paid, faling which it shall be deemed to be rejected. After the expiration of the time ‘within which an offer may be accepted, or on the recelpt of @ response from the Shareholder counter 67 ‘peteti osm be psd haa eager coat onan te lt SOC ag DOE {‘MEMORANDUM OF INCORPORATION Rev |0 Document | 240- Wdentifer | 65347859 40 10.4 102 10.9 104 104. that It declines to accept the ordinary Shares offered, the Board may, subject to the ‘foregoing provisions and clause 3.20.8 ofthis MO}, Issue such ordinary Shares, PROHIBITION REGARDING BENEFICIAL INTERESTS ‘The Company shall not perm its Shares to be held by, and registered In the name of, one Parson for the Beneficial Inlerest of another Person, as set out In section 68(1) of the Companies Act. RESTRICTION ON THE TRANSFER OF SHARES In addon to any other prescribed obligations which the Shareholder may agree to, no Sharos shall be transferred without the prior Waitlen consent of the Shareholder. ‘TRANSFER OF SECURITIES ‘The Shareholder is the holler ofall the iesued Shares which relate to the Company as set out in clause 6.2 above, Where the Shareholder may elect to sell, cade or transfer any of the Seouries in the Company the instrument of transfer of any such Secures shall be signed by both the trensterot and the transferee and the transferor shell be deemed to romaln the holder of ‘such Secuttis unti the name ofthe ransferea is entered in the Secures Register. ‘Subject to such restrctlons as may be applicable, (whether by vitue of the preferences, fights nations or ther terms assoclatod wit the Securities In question), any Sharcholder ‘or holler of Securities may transfer all or any ofits Secures by Instrument in Weng in ary usual or common form of any other form which the Board may approve. Every instrument of transfer shall be Delivered to the Offce of the Compeny, accompanied by: + the certiieste Issued in respect of the Securities to be transferred; andior 10.4.2. suich other evidence as the Company may require to prove the tite of the transferor, or 105 108 hethis right to transfer the Securities. ‘All authorities to sign transfor deeds or other instruments of transfer granted by holders of ‘Shares for the purpose of (ransforring Secures which may be lodged, produced or ‘exhibited with or to the Company at iis Otice shall, ae between the Company and the ‘grantor of such authorities, be taken and deemed to continue and remain In full force and cffect, and the Company may allow the same to be acted upon until such time as express notice in viting ofthe revocation of the same shall have been given and lodged at such of the Company's Office at which the authority was frst lodged, produced or exhibited. Even after the giving and lodging of such notice, the Company shell be entlled te give effect to any instruments signed under the euthenty to elgn and certified by any officer of the ‘Company as being in order before the giving and! todging of such notice. ‘Al Instrumente of transfer, when registered, shall ether be retained by the Company or ‘disposed of In such manner as the Board shall fom time to time decide. Any instrument of hn dowd bn n doar nanigvns pti Siete nad ad tm ipa ewe se ARI nan er eerreennnnanes ae eae tsi oun etme LDocument | 240- MEMORANDUM OF INCORPORATION Identitor | aszaveso RV | Iransfer which the Board may decline to ragisler shall (unless the Board shall resolve ‘therwise) be returned on demand to the person who lodged it. 40.7 Securities transfer tex and other legal costs payable in respect of any transfer of Seourios pursuant to this MOI will be peld by the Company to the extent that the Company ls fable therefore In Law, but shall, to that extent, be recoverable from the person acquling such Secutios 11 SHAREHOLDERS AND DIRECTORS’ RIGHT TO INFORMATION 14.4 The Sharaholder shall havo the rights to all such information relating to the Company as ‘contemplated inthis MOI, of In accordance wih the Legislative or Polley Framework. 41.2. The Boord shell procure that detalled management accounts of the Company and its ‘Subsidiaries shal be prepared on a quarterly basis and submitted to the Shareholder within the Month after the end of the quarter or such olher period as may be agreed by the Shareholder and the Company in Writing in respect of which such accounts ere being prepared. Any Director or the Shareholder shail be ented to request from time to time such accounting and other information as may be reasonably required by such Director or the Shareholder. 42 RECORD DATE {fat any time, the Board falls to determine a Record Date as contemplated in section 69(1) of the Companies Act, the Record Date for the relevant action or event is as determined in ‘accordance with section 69(3) of the Companies Act. 43 SHAREHOLDER’S MEETINGS AND ROUND-ROBIN RESOLUTIONS 13.1 Convening of Shareholler's Meetings and Annuel General Mectinas 4311 Subject to any exemplion which may be granted to the Company in terms of the ‘Companies Act, the Board shall convene en Annual General Masting al least once & year but no later than 16 (ifteen) Months after the date of the previous Annual General Meeting or within an extended time allowed by the Companies Tribunal, on good cause shown, wich must, ata minimum, provide forthe folowing business to be transacted ~ 13.411 presentation of the Integrated report, comprising ~ 134444 the Directors report; report of the external aucors; 134443 audited Financlal Statements for the immediately preceding Financial Year, ‘subject to the provisions of socion £4(8) of the Companies Act; sB4td ‘9n audit commitoe report; and 184.1.18 ‘he social and ethics committee report 13.1.1. appointment of Directors by the Shareholder, to the extent required by the Companies ‘Act, this MOI or the PMA; fee ‘vermin inn scan pn nn hom si bape nn an a pe et oan mayb dia tn mrt st och, Eom tgs SOC ag He ROLLIE 64 %Document | 240- (MEMORANDUM OF INCORPORATION idectiter | essavasa [ROY | 13.143 consideration of the Remuneration Policy of the Company and confirmation that such 134.44 BAL 1BA18 BAT 19.4.1.8 BAA 1844.10 144A 434.142 19.4.1.49 BAt44 84.2 13.4.3 19.404 13.4.6 13.1.6. 131.62 Remuneration Pollcy 1s in accordance with any "Remuneration Guidelines” andior™ Standards" published by the Minister from time to time; approval of the remuneralion payable to non-executive Directors by Special Resolution (except where such remuneration has been approved by the Shereholder by Special Resolution within the previous two years, aiough this may be considered fon an annual basis if s0 required by the Shareholder); ‘approval ofthe remuneration payable to executive Directors and members of Exco by Ordinary Resolution; ‘appointment of an Auditor for the current Financial Year, subject to the provisions of section 64) of the Companies Act noling of the aust fees forthe previous Financial Year under review; authorising the Board to fhe the audit foes for he current Financial Year, ‘appointment of an audit committee, subject to clause 19 below: approval of the Distibutlon to the Shareholder, any, which shall have been recommended by the Board in accordance with any Distribution policies applicable to the Company, from fimo fo ime and the provisions of clause 24 of this MO! and any applicable provisions of the PFMA, on concltion that the Shareholder may not ‘approve a Disitbution higher than that recommended by the Board. In the event Boerd resolving not to declare a Disrbution such resolution to be noted by the Shareholder; noting ofthe Shareholders Compact for the current Financiel Year, consideration andor approval ofthe SMF; consideration of the performance of the Board, through the Board performance _appraisl report forthe previous Financial Year; and ‘any malters raised by the Shareholder, with or without advance notice to the ‘Company. ‘The Shareholder or Board may, subject to the provisions of section 61 of the Companies ‘Act, convene a Shareholder’s Meeting af any time. ‘The Company authorises the Minister to call a Shareholder’s Meeting forthe purposes of section 61(11) of the Companies Act. ‘The Shareholder’ Mectings referred to In lausos 18.1, 19.1.2 and 19.1.3 above shall be held in Johannesburg, Pretoria or Cape Town, provided however, that In exceptionel ‘droumstances, such meetings shall be held at any other place ae the Shareholder deems fi ‘The Company shall, as determined by the Board, ether — hold a Shareholder’s Meeting in order to consider one or more resolutions; ‘as regards such resolutionis that could be voted on at a Shareholder's Meeting, other than en Annual General Meeting, Instead require euch resoluions to be dealt with by ‘Round Robin Resolution of the Sharehoker. ‘nn conde tan en aspen Beane es se pen eh aia ern Renn sone ctonan onion “yoponctiisenunon be pend who epian se once, En igr 00 Ma Ne HEABUIS “JO yMEMORANDUM OF INCORPORATION Document | 240- Identifier 65347859 Rev jo 13.1.6 1347 BATA 13.4.72 3.4.73 Within 40 (ten) Business Days after the Shareholder adopts a Round Robin Revolution, the Company must Deliver a statement describing the resuits of the vote, consent ‘process, or appointment to the Shareholder. ‘The Company must hoki a Shareholder’s Meeting or put the proposed resolution to the Shareholder by way of a Round Robin Resolutio fal any lime that the Board is required by the Companies Act or the MOI to refer a matter {o the Sharehokler for decision; or ‘whenever required to fila vacancy on the Board; and When otherwise required In terms of section 61(3) of the Companies Act or by this Mol. 13.2 Notice of meetings of the Shareholder 132.4 13.2.2 132.24 132.22 13.223 132.24 13226 192.254 132.282 19.2253 18.22.54 19.2.2.5.6 ‘Subject to complence with seen 62 of the Companies Act, an Annual General Meeting and a general meeting of the Shareholder shall be convened by glving notice of atleast 46 (itean) Business Days to the Shareholder ‘A notice of a Shareholder's Meeting must be in Welthg, in plain language and must Include: the date, ime and place for the meeting, and the Record Date for the meeting; the general purpose of the meeting, and any specific purpose contemplatod In section £61(@) (a) of the Companlas Act i applicable; in the case of the Annual General Meoting, the complete Financial Statements to be presented and directions for obtaining a copy of the complete annual Financial Statements for the preceding Financial Year, ‘a copy of any proposed resolution of which the Company has received notice, end Which is to be considered at the Shareholder's Moeting, end a notice of the percentage of Voting Rights that wil be required for thal resclution to be adopted ‘reasonably prominent statement that: the Shareholder shall be ented to appolnt a proxy to attend, participate in, speak and vole al the Sharcholder's Meeting in the plaoe of the Shareholder or give or vithhoké Written consent on behalf of the Shareholder to a decision by Round Robin Resolution of the relevant Shareholder; 2 proxy need not be a Shareholder; ‘a Shareholder may appoint more than 4 (one) proxy to Exercise Voting Rights attached to diferent Securlies held by that Shareholder In respect of any ‘Sharehokder’s Meeting; the proxy may delegate the authority granted to her/him as proxy, subject to any restriction in the intrument appointing the proxy herhimsel, parlicipants in a Shareholder's Meeting ore required to fumish satisfactory identiiclion in terms of section 63(1) of the Companies Actin order to reaeonably tality tho person presiding at the Shareholders Meeting that the right of that “Yawn drt von doco niaenet pti aes te apes ioeten alse owe iattedinananbeensae ‘putt doce mops eee coe Dea tm ees SOC a He ZR GgMEMORANDUM OF INCORPORATION Docmmere | 200, rev |o ‘dentiter | 65347859 13.2.26. 192.3 19.24 1324.4 19.2.4.2 1326 13.26 13.264 19.262 13.262 person to participate and vote, either as the Shareholder, or as a proxy for the ‘Shareholder, has been reasonably verliod; and 8 paricipation in the Shareholder's Meeting by Electronic Communication is avallable, and provide any necessary information to enable the Shareholder or its proxy to access the avallable medium or means of Electronic Communication and ‘advise that access fo the medium or means of Etecironle Communication is at the ‘expense of the Shareholder or proxy, except to the extent that the Company determines otherwise. ‘A Shareholder’s Meeting may proceed notwithstanding a Material defect in the giving of ‘the notice, subject to clause 13.2.4 below, only If every Person who ts enliled to Exercise Voting Rights In respect of each Item on the agenda of the Shareholder’s Meotng is Present at the Shareholders Meeting and vote to approve the rattication of the defective notice. If @ Materia defect in the form oF manner of giving notice of a Shareholder’s Meeting telates only to one or more particular matters on the agenda for the Shareholder's Meeting: - ‘any such malter may be severed from the agenda, and the notice remains vad wah respect lo any remaining matters on the agenda; and the Shereholder’s Meeting may proceed to considar a severed matter, ifthe defective nice in respect ofthat matter has been ratified in terms of clause 13.2.3 above. ‘A non-Material defect In the form or manner of Dalivering notice of a Sharehelder's ‘Meeting, of en accidental or Inadvertent fallure in the Delivery of the notice to the ‘Shareholder to whom It was addressed If the Company elects to do $0, does not invalidate any action taken at the Shareholder’s Meeting. ‘The Shareholder or its proxy, who is Present al e Shareholder’s Meeting: — Is regarded as having received or waived notice of the Shareholder's Meeting ff at Teast the required minimum notice was given; has a right to: 4 ‘allege a Material defect in the form of notice fora particular Rem on the agenda for the Shareholder's Meeting; and 18.26.22 pparleipata in the determination whether to waive the requirements for notice, i 182.63 433 133.4 1332 less than the required minimum notice was given, oF to rally a defective notice; and ‘xcept to the extent sot out in clause 13.2,6.2 above, Is regarded to have walved any right based on an actual or alleged Matarial defect in the notica of the Shareholder’s Meeting. Proceeilings et meetings of the Shareholder ‘The Annual General Meeting shall desl with and dispose of all matters presoribed by the Companies Act and the provisions of thls MO! and may deal with any ether business sesed by the Shareholder or any other business lad before I. ‘The quorum necessary for the commencement of a Sharehoider's Mooting or for a matter to be considered at @ Shareholder’s Meeting shall be the Shareholder Present in aonee oeo gue deanna ver vn en cnt ait, on He 80 6 ay Ne eB aeMEMORANDUM OF INCORPORATION Document | 240- identier J esaaresa | RV | 13.3.3 13.3.4 13.3.6 13.36 13.3.6.1 13.362 13.37 1338 13.3.8 18.9.10 person or represented by proxy. Business al any Shateholder's Meeting may only be ‘conducted while a quorum Is Present. ‘The appointment of a proxy to represent the Shareholder In any Sharehoider’s Meeting ‘or Annual General Meeting of the Company shall be in accordance with the provisions of ‘he Companies Act and this MOI. ‘A Shareholder's Meeting may be conducted by way of Electronic Communication or by any one or more persons participating In the Shareholders Meeting by Electronic ‘Communication ‘Any Sharcholder’s Meeting may be postponed or adjourned ae provided for in the Companies Act. fwithin 4 (one) hour from the time appointed for the Shareholder's Meeting, a quorum Is ‘not Present, for the mesling to begin, the Shareholder’s Meeting shall be postponed, without ‘motion of vote or further notice to the date, time and place, as agreed to by the ‘Shareholder as soon as reasonably practicable after the date of such postponed or adjourned meeting; fot consideration of a particular matter to begin, if there is no other business on the agenda of the meeting, consideration of the matter may be postponed without motion ‘vote or further notice to the date, time and place, as agreed to by the Shareholder ‘as son as reasonably practicable after the date of such postponed or adjourned meeting. No further notice Is required to be Delivered by the Company of a Sharehokder’s Meeting that Is postponed or adjouined as conternplated In clause 13.3.6 above, unless the location of time for the Sharchokier’s Mosting is ditforant from a location or time ‘announced al the time of postponemont of adjounment, Inthe case of a postponed or ‘adjoutned Sharatolder's Meeting. ‘The chalrperson of the Board shall preside as chaliperson at every Shareholders ‘Meeting of the Gompany. Ifthe chairperson is not Present at the Shareholder's Macting, ‘or if afhe fs not Present within 30 (thirty) minutes after the time appointed for holding the ‘Shareholder's Meeting, the Shareholder shall choose any non-executive Director Present to be chairperson of the Shareholder's Meeting, Ifno such Director is Present or f none of the non-executive Dreolors Present are wiling to chair the meeting, then the Shareholder (or 2 duly authorised representative therec*) shail be entitled to chair the Shareholder's meeting. ‘The chaltpereon may, In accordance with section 64(10) of the Companies Act, with the consent of any Shareholder's Meeting at which @ quorum is Present (and shall If so directed by the Shareholder’s Meeting), adjourn the Shareholder's Meeting from time to time and from place to piace, but ne business shal! be transacted at any adjourned Shareholder’s Meeting other then the business left unfinished at the Sherehotder's Meeting from which the adjournment took place. ‘When Shareholder's Meeting Is adjourned as a result of a direction given in terms of, ‘any applicable provision in the Companies Act, notice of the adjourned Shareholder’s ‘Meeting shell be glen in the manner prescribed by euch provision but, save as aforesald, It shall not be necessary to give any notice of an adjournment or of the business to be transacted al an adjourned Shareholder's Meeting. No Shereholder’s ‘ansaid ane wanna yin nen cmt nt peyton PR Hepatton ocmet aye od sat he wet sno baeapa iol, on et SOC ag He ADOIESING 13 GyMEMORANDUM OF INCORPORATION Document | 240- denier | essavasa [RY |° 19.3.11 183.12 Meeting may be adjourned beyond a period of 60 (sixty) Business Days from the date on hich the adjournment occurred. Every resolution of the Shareholder is ether an Ordinary Resolution or 2 Special Resolution. ‘A Round Robin Resolution signed by the Shareholder or by & duly authorised representative on behalf of the Shareholder, within 20 (twenty) Business Days after hes been eubmitted to the Sharoholder in terme of section 60 of the Companies Act, shall be ‘as valid and effective as if had been passed al a Shareholder’s Meeling of the ‘Company duly convened and held. 44 DIRECTORS 144 1444 Mat2 AAA WA88 1416 “a2 General ‘The Shareholder shall have the exclusive power to appoint Directors pursuant to the provisions of section 66 (4) (a) () of the Companies Act and section 63(2) of the PFMA. ‘The Board shall consist of a minimum of $ (three) Directors and a maximum of 45 (fiteen) Directors, the majority of which shall be Directors that are nol employed by the Company Cron-execulve Directors’) and at least 2 (Wo) of which shall be Directors who are employees of the Company, being the Group Chief Execulive and the Group Chief Financlal Officer (executive Director). AL is specically recorded that the oxeculive Directors are not ex officio directors as contemplate In section 65 (4) (a) (W) ofthe Companies Act No Director shall be entitled to appolnt an Alternate Director. ‘The Shareholder shall endeavour to ensure thatthe Board shalt: ~ be appropriately balancod in terms of execullve and non-executive Directors; be representative ofthe gender and race demographics ofthe Republi; bbe appointed on the grounds of thelr knowledge and experience which, when ‘considered collectively, should enable the Board to attain the objects of the Company ‘when viewed collectively, possess appropriate skis and experience relevant to the business of the Company; and not inude persone who are Ineligible or Clsquaiied, as set out in section 68 ofthe ‘Companies Act, ‘The Shareholder shall have the right to appoint @ Director to the Board, who may be a Government oficial, whenever the Shareholder deems It necessary, subject always to {ho provisions of the Companies Act, this MO! and the Policy Framework, Appointment of non-oxecullve Direclors meson dceeninurgment an i can eaten geyser lt EN scent to nue dco brett ee ost be ee, Hen eg 0 LN ag DOE) 74 %MEMORANDUM OF INCORPORATION Document | 240- Identifier 65347859 Rove 143 143.4 143.2 14.33 1434 1435 14.3.6 44 WAL 16.4.2 1443 1844 148 145.1 ‘The non-executive Directors shall be appointed by the Shareholder fora period of 3 (thes) years ata time (‘aterm’), which appointment Is reviewable annually, provided that no non- ‘executive Director Is appointed for fonger than 3 (three) consecutive terms, oval of ve ‘The Shareholder shall, on behalf of the Company, have the exclusive power, In ‘exercising Its Ownership Contro! pursuant fo the provisions of sec 63 (2) of the PFMA, to ‘appoint and remove the CE as an employee of the Company in accordance with the Guidelines The Shareholder may request the Board to identify, nominate and evaluate potential candidates for appolniment as the Group Chief Executive in accordance with the Guidelines end to submit a shorlist of candidates to the Shareholder to assist the ‘Shareholder wit the appointment, The Shareholder's act of appointment of the Group Chief Executive binds the Company {to the exclusion of the Board. The Minister shall be noted 2s a party to any contract of employment betweon the Company and the Group Chief Executive. ‘The Group Chiof Executive shall report to the Board and shall only become en execuve Director of the Gompany If appointed to the Board by the Shareholder in terms of clause 44.4.1 of this MOL. ‘Tho Shareholder shall, on behalf of the Company, have the excluslve power to remove the Group Chiat Executive as an employee of the Company which removal would constitute @dlamissal as ernisaged In lems of Section 188(1)(@) ofthe Labour Relations ‘Act 65 of 1995 (‘the LRA"). Consaquently, the provisions of the LRA apply to any such removal, ‘Process of appointment of the Group Chief Financial Officer “The Board shall Identify, nominate, evaluate and appoint a candidate for the position of Group Chief Financlal Officer, provided thal the Shareholder shell, in Writing, approve ‘such candidate prior fo the appointment by the Board. f the Shareholder does not approve the candidate nominated by the Board for the positon of the Group Chief Financial Otic, the Shareholder shall be required to provide ‘a Wiilten substantive motivation to the Board as to why the Shareholder does not approve the candidate nominated by the Board, Provided the Shareholder provides such Written substantive motivation to the Board, ‘such candidate shall not be appointed as the Group Chief Financial Officer and the Board shall kienlify and nominate an alternative candidate for appointment as the Group Chief Financial Officer and the process contemplated in this clause 14.4 shall be ‘repeated until euch time as an appointment has been made. ‘The Group Chief Financial Oficer shall only become an executive Director of the Company if appointed to the Board by the Shareholder in terms of clause 14.1.1 of this MOI, Chairperson ofthe Board ‘The chaliperson of the Board shal be appointed by the Shareholder. ‘es emtston te trem mito in ger ae toe pe AD nrc ane pum exon bo esient iat oee cnt pi Em EN SOC ge BREE UY“I ‘MEMORANDUM OF INCORPORATION Document | 240- Identiter | 65347859 146.2 1453 1464 14544 tab Ad 145.5 148.2 147 aIA an 148 14.8.4 ‘The Company in general meeting shall be entiled to designate an acting cheirporson (fram eny of the non-executve Directors) and determine the period for which such acting chairperson is to hold office and any other terms and conditons applicable to such appointment untl the Shareholder appotnts the chairperson. “The chalrperson ofthe Board shal chair all the meetings ofthe Boar. If the chalrpereon {snot Present at any such meeting or If ihe Is not Present within 30 (tity) minutes ator the time appointed for holding the meeting, the Directors Present shall choose any nom- ‘executive Director to be chalrpereon of the meeting. ‘The Director appolned as chalrperson of the meeting in terme of clause 14.6.3 above shall act as chairperson: = {or the duration of the meating until the meeting Ie adjourned: or for such a petiod of ime after the adjournment of the meeting at which such Director ‘was appointed as chakrperson until the chakperson of the Board becomes available. ‘The chairperson of the Bosrd shall not be appointed or serve as the cheltperson of @ Standing Committas (save for the People and Governance Committee) or as the chairperson of a Subsidiary board. For eo long as the Government I the sole Shareholder, itis recorded thatthe board of a wholy-owned Subsidiary of the Company should, subject to clause 14.6.2 below and eny other lew applicable to the Subsidiary, comprise employees of such Subsidiary or the ‘Company. itis recorded that, should any wholy-owned Subsidiary of the Company wish to appoint rectors wino are not employees of the Subsidiary or the Company, such appointments, shal be approved by the Shareholder In Writing. ‘Remuneration of Direotore ‘The Board of the commitlee of the Board responsible for remuneration matters of the Company shall determine the remuneration of the Individual Directors and Exco within the framework of the Remuneration Policy and which remuneration shall be approved by ‘Special Resolution of Ordinary Resolutlon as contemplated in clauses 13.1.1.4 end 43.1.1. respectively ofthis MOI Non-executive Directors may be pald all traveling, hotel and other expenses properly incurred by them in or about the performance of thelr duties as Directors, including, those ‘expenses Incurred in altending and Iravelling to and from meetings of the Directors or any committee of the Directors or at any Shareholders Meeting. Powers of Directors Subject to clause 3.6 , tho management and control of the Company shell be vasted in the Board which, in addlilon to the powers and authorities expressly conferred upon It by ‘section G6 (1) of the Companies Act, sections 49 to &6 of the PFMA, this MOI, , may Exercise all such powers, and do al such acts and things, as may be Exercised or done by the Company and are nol, in terms of this MO! or the Legislative and Policy Wr donned tn demon mania pt ha og mn nm psy nares hn ti puts enema een eed ne a capi, Seng SOC ag Me ILS Yoe. MEMORANDUM OF INCORPORATION ent ae Rev jo Identifier | 65947859 148.2 14.8.8 14.8.8.4 14,8.3.2 148.33 148.34 14.8.4 149 44.10 14.104 14.10.2 44.10.24 1410.22 14.10.23, 14.103 Framework, expressly directed or required to be Exercised or done by the Company in general meeting or with the prior Written consent ofthe Shareholder. ‘The Board may, subject to the provisions of section 6 of the PFMA, delegate, any of is powers or functions to any Directors, employee(s) andlor to commitices. The delegation shall be Exercised lawully, within prescribed powers and autherisaton levels and in terms ofthe Company's poles, directives and procedures. ‘The delegation: - ‘may be made on and subject o any coneiions determined by the Board; ‘may be given together withthe power fo sub-delegate subject to the provislons ofthe PEMA and the Companies Act and further subject to any conditions 60 determined (i any), shall be communicated to the delegate in Writing and such WrRlen communication must contain full perticulars of the malters being delegated and of the conditions dotermined under clauses 14.8.3.1 and 14.8.8.2 above, If any, and where the power of sub-delagation is also conferrad, must state that fact, as well as any condtions ‘determined under this couse 14.8.3.9 i any; and shall be reviewed on a regular basis, ‘The Board may, without requiring the consent of the Shareholder, and in accordance ‘with clause 14.6.3 above from time to time revoke, withdraw or vary such powers ‘contemplated In this clause 14.8. Recognition of the Dov, IR te recorded that the DoA records (but does nat oreate} certain imitations on the powers of ‘the Directors, which limtatlons arise as a result of this MO}, the Companies Act and the PEMA Ilis further recorded that itis the Intention of the Board that It shall delegate certain of its powers and functions to Directors, employees andlor committees as contemplated in ‘the DoA by passing a resolution of the Board adopting the DoA in accordance with the principles set out in cause 14.8 above. Proceedings af Meetings of Directors “The Directors. may meet forthe patch of business, adjourn and otherwise regulate their meetings as they think fit. ‘The company secretary of a Director may al eny time: - ‘when authorised by the Board; or W requested by atleast + (one) Director which request shall alao be approved by the chaltperson ofthe Board; or IWrequested by at least 2 (lwo) Direotors of the Company ‘convene a meeting of the Board. The Board shall determine the period of notice which shall be given for meetings of Directors andlor for Round Robin Resolutions and may determine the form or medium of ‘alving such notice, which may include Electronic Communication, It shall be necessary to give notice of a meeting of Directors and/or for Round Robin Resolutions to all Directors even those for the time helng absent from the Republi, ‘ow ett nn om rca rt naan es dba enna ‘peter cocoa map va tri coe coon BM. em Magog 3G aaa NESTE 91S Document | 240- MEMORANDUM OF INCORPORATION briorinedueted Prefer 14.104 A meeting of Directors shall proceed even If the Company has not given the required notice of such meeting in accordance with clause 14.10. above or If there was a dofect Inthe giving of the notice, provided that at Directors: 4410.41 acknowledge actual recelpt of the notice of the meeting concerned; and 1410.42 aro Present at the meating; or 14.10.48 walve notice of the meeting, 4440.5 A meeting of Directors may be conducted by one or more Directors partcipeting in the meeting by Electronic Communication, 1410.6 The quorum for a meeting of Directors shall be not less than a majority of Directors. 14.40.7 Subject to exclusions In the Companies Act, each Director shall have 4 (one) vote on a ‘matter before a meeting of Directors. 4410.8 Resolutions of the Directors In a meeting shall be decided by a majority of votes. In caso ‘of an equally of votes, the chalrperson shall nol have a casting vote (in addition to hethis vote as a member of the Board or a Board committee) and the matter being voted on falls, 44,108 —Subjct to the Companies Act and this MOI, a Round Robin Resolution, signed and approved by not less than 75% (seventy five per cent) of the Directors shall be as valid and effective es If It had been passed at @ Board or Board committee meeting, duly called and constituted. 44.40.10 Resolutions adopled by the Directors ~ 14.10.101° must be dated and sequentially numbered; and 14.10.12 are affeclive as of he dale of the resolution, unless the resolulion states otherwise. 44.40.41 ‘The company secretary shal attend meetings and record the minutes of the meetings. ‘Where itis not at all possible for the company seoretary to attend any such meeting, the Board of Board committee, asthe cate may be, shalt ensure that minufes are recorded, kept ard prepared for that meeting. The Director or any other person elected by the ‘Board of Board committee to record and keep minutes of a maeting held by making use ~ of Electronie Communication shall, 2s soon as Is reasonably posskle after such meeting has been held, provide the company secretary with a copy ofthe minutes ofthe meeting, 4441 Removal of Directors 444141 Deopite anything to the contrary in the Companies Act, this MOI, or any agreement between the Company and a Diester, or between any Shareholder and a Director, the Sharcholder shal be solaly responsible forthe removal of a Director In accordance with the provisions of Section 63(2) ofthe PFMA, provided that the Director concerned shal! 144444 de removed by an Ordinary Resolution adopted al a Sharoholdere Meeting as provided for in section 71 (1) of the Companies Act, and 14.114.2 have boen given 16 (fiteen) Business Days Writen notice of the meeting and the resolution; and 1411.1.8 be alforded a reasonable opportunlly to make a presentation, In person or through a ropresentalve, to the meeting, before the resolution Is put tothe vote. 4444.2. Where an alegation contemplated in section 71(3) ofthe Companies Act has beon made the Board must determine, by resolution, whether thatthe Director has either: entation ors yen meen mes eine aa re oleracea rir a pte decent yb oat Omet Da rant caret thon SOC pH ZERO7 MEMORANDUM OF INCORPORATION Pet oe Rev |o Identiier | 65347859 1441.24 14.1122 14.11.23 1414.8 A194 1113.2 4114 442 tata 4442.2 14.128 1442.3.4 14.4232 14.128.2.4 14.12.8.2.2 4.423.238 14.128.2.4 14.123.25 ‘become ineligible or Disqualied to be 2 Director of the Company in terms of the Companies Act; or ‘become incepactiated to the extent thal such Director Is unable to perform the {functions of a Director and is unlikely to regain that capacty within a reasonable time; o ‘neglected or been derelict in the performance ofthe functions of a Director. Before the Board may consider a resolution contemplated In clause 14.11.2 above the Director concemed must be given: notice of the meeting and the resolution proposed fo be passed at euch mesting and 1a statement selling out reasons for the resolution, with sufficient specificity to reasonably permit the Director to prepare and present a response; and: ‘@ reasonable opportunity to make a presentation, in person or through a representative, o the meeting before the resolution is put to the vote. ‘Where the Board has made a determination as contemplated In 14.11.2 then the Board, having regard to the provisions of section 6(4) of the Companies Act, shall not remove the Direclor but must, wilhin 26 hours of having made its determination, refer its ‘determination to the Shareholder In which case the provisions of clause 14.11.1 shal ‘apply mutals mutandts. of vacar Ifa Director ceases to hold office or a term of ofice of any Director Is due to expire, the Shareholder shall, in compliance withthe provisions of section 70 of the Companies Act, ‘onsure that necessary stops are taken to appoint the roquislle number of eligible persons a8 Directors in the place of the retiring Director's as soon as possible. inthis regard the Board shall, where possible, advise the Shareholder within @ reasonable time of such impending vacancy. ‘The Shareholder shall tn any vacancy that arose on the Board by a new appointment a8 contemplated in terms of section 70(3) (a) of the Companies Act. ‘Apperson shall cease to be o Director and a vacancy on the Board shall erise:~ ‘when the Director's term of ofice explres as contemplated in clause 14.12.8.3 below, 1, subject to the provisions of 14,41.2, any of the crcumstances referred to In section 70(1)(b) of the Companies Act occur, which Include the following, if the Director:~ Fesigns (provided that such resignation is given by Written notice fo the ‘Shareholder and the Company); os; ‘n the cave of an Ex Officio director, ceases to hold the office, tlle, designalion or ‘Similar status that ented the person to be an x Otoko Director ofthe Company, becomes incapactialed to the extent that the person Is unable to perform the functions of a Director and ts unlikely to regain thal capactly within a reasonable potiog, subject to section 71(3) ofthe Companies Act; is dectared deinquent by the eourt or placed on probation under conditions that are inconsistent with continuing 10 be @ Director of the Company, In terms of section 162 of the Companies Act; ‘nent ed ocean ns eines un pny Inner ener ath por enonMEMORANDUM OF INCORPORATION Document | 240- ‘identifier (65347859 Rev 10 14.12.3.28 1412.3.2.7 14.12.3.274 14.42.9.2.7.2 14.12.9.2.7.3 129.274 14.12.33 14.12.3.3.4 14123.8.2 1412.83.38 14.12.8.98.4 becomes Ineligible or Disqualiied in terms of section 69, subject to section 71(3) of the Companies Act; or 1s removed as a Director by: - ‘a resolution of the Shareholder in terms of section 63 (2) of the PFMA and in ‘accordance with the provisions of 14.11.45 oF 2 resolution of the Shareholder In terms of section 63 (2) of the PFMA and! in accordance withthe provisions of 14.11.2; or an order of the court in terms of section 74(8) or (6) of the Companies Act or It sihe is absent from Board meetings for 3 (three) consecutive meetings without leave of the Board and the Shareholder resolves that the office be vacated; In the case of non-executive Directors: - ‘8 Director's appointment is reviewed and herhis term is terminated prematurely ‘the 3 (three) year term; € Director has served for & 3 (three) year term, and falls to be re-appointed as Director fora 2nd (second) term oF 2 Director has served for 2 (Wo) consecutive 3 (three) year terms, and falls to be re-appointed as a Director for a 3 (third) term; ‘4 Direclor has served for 3 (Uiwee) consecutive 3 (three) year terms, which 3 (tite term has now expired. 14.124 Unless the Shareholder resolves otherwise, a Director shall also cease to hold office and ‘a vacancy shall arise if = 14.4244 14.12.42 144243 shhe Is Knowingly interested in any contract or proposed contract with the Company and falls to declare herthis Interest and its nature in the manner required by the ‘Companies Act and the PFMA; or ‘she assigns herthis estate for the benef of her/his creditors, or suspends payment or files a petition for the liquidation of hexhis affairs, or compounds generally with her/his. creditors; or ‘tho ceases to be an employee of the Company or is suspended as an employee of ‘the Company and the Shareholder has resolved to remove such director in accordance wih the provisions of clause 14.111 14.42.5 addition, If the CE or FD coases to hold office es @ Director for any reason whatsoever, herihis appointment as CE or FD (as the case may be) shall iso faoto terminate without prejudice to any claims for damages which may accrue to herfhim as a result of such termination In accordance with applicable employment laws; provided however, that s/he shall not be prectuded from being employed in any other poslion of the Company by vitue ofthe fact that sie Is no longer a Director. 14.13. Ineliobiliy or Disqualification of Directors 1413.1 Aperson Is Ineligible to be a Director of the Company Ifthe person 144344 419-12 1s 2 Jurstic Person; {Js an unemancipated miner, or ts under a simiiar legal dieabilly; or ‘nu det a este angry Sen eae Rae ME ene a nN Sattedcn ebenMEMORANDUM OF INCORPORATION Document} 240- identiter | esaareso | Re” | ° 14.18.1.3 ‘oes not satiety any qualifcation set outin the MO}. 4413.2 Apperson Is Disqualified to bs 2 Director of the Compony it 144324 14.49.22 4443.2.24 14.19.2.2.2 14.13.2.23 14.19.2.2.4 14.13.2244 1413.22.42 44.13.2243 ‘a cout has prohibited that person fo be a Director, or declared the person to be delinquent In terms of section 162, oF In terms of section 47 of the Close Corporations: ‘Act, 69 of 1984; oF save under authority of the court, the person - {an untehabiltated insolvent, |s prohibited in terms of any public regulation fo be a Director of the Companys thas been temoved fram an office of trust, on the grounds of misconduct involving dishonest has been convicted, In the Republic oF elsewhere and imptisoned without the ‘option of a fine, oF fined more than the prescribed amount for thet, fraud, forgery, perjury or an offence: - Involving feud, misrepresantation or dishonesty, {in connection with the promotion, formation of management of @ company, or In connection with any act contemplated In section 69(2) or 6915) of the ‘Companies Act; or Under the Companies Act, Insolvency Ast, 1938; Close Corporation Act, 1984; Compettion Act, 1998; Financial Inteligence Centre Act, 2001; Securities Services Act, 2004; or Chapter 2 of the Prevenlion and Combating of Corruption Activites Act, 2004. 45 FINANCIAL ASSISTANCE AND BORROWING POWERS OF THE COMPANY AND COMPANY'S SUBSIDIARIES 16.1 Financial Assistance 16.44 164.44 154.12 164.424 $8AN22 “The Company is prohiblied from and shall not have the power fo~ authorise the provision by the Company of Financial Assistance to any parson forthe purpose of, oF in connection with, the subscription of any option, or any Shares, issued or {0 be lesued by the Company or a Related Person or inter-Related ‘company, of for the purchase of any Shares of the Compeny or a Related or Inter Related compa provide any direct or indirect Financial Assistance 10 @ Related or Inter-Retated ‘company oF corporation, of fo @ member of a Related ot inter-Related corporation or toa person Relaled lo any such company, corporation, of momber, except, in each caso, where - the Shareholder has approved such Financial Astistance, ether for the specific reciplent or generally for a calegory of potential recilents (and the specific ‘ecipiont fal within that category), by Special Resoluion adopted within the previous two years; provided that where the Shareholder is requested to appravo the provision of specific Flnanclal Assistance, the Board shal at tho request of the ‘Shareholder, provide such information to the Shareholder as the Shareholder may ‘yma tents on son anger sit, coc et nt mgr ex En eatin We ite coat ime ange bane pte cane nb ed tt eta oe bape aes S00 4 gD | 9MEMORANDUM OF INCORPORATION Pocument | 240" Rev | 0 ‘eentifer | 65347859 require, to salisty the Shareholder that the conditions set out in clauses 18.1.1.2.3, 15.1.1.2.4 and 15.1.1.2.6 helow have been met, or wil be mat; and 1541.28 the provistons of the PFMA have been met; and BANDA the provisions of section 44 andlor 45 (as the case may be) of the Companies Act hhave been met; and 1641.25 the Board is satisfied that ~ 1614254 Immediately after providing the Financiat Assistance, the Company would satiafy the solvoncy and liquldty test prescribed in section 4 of the Companies Act; and 15.41.1262 the terms under which the Financial Assistance is proposed to be given are fair 15.1.2 153 1534 15.3.2 154 and reasonable to the Company. ‘The Company shall be prohibited from providing any direct or indirect Financlal ‘Assistance to any Director or Prescribed Officer of the Company or to a person Related oF Inter-Related to any such Director or Prescribed Officer save in respect of any Financial Assistance which has been epproved in terms of section 45 of the Companies ‘Act and in terms of clause 15.1.1.2 above and contemplated In accordance with the terms of employmont applicable to Prescribed Officers, subject always to the provisions of section 45 of the Compantes Act. Board's ‘Subject to the provisions of the PFMA (and, in particular, seotion 66 of the PFMA), the Board may ralse or borrow funds from time to time for the purposes of the Company, or secure the payment, of such sums as is In accordance wih Its Corporate Plan and the borrowing programme submitted to the Shareholder, unless otherwise determined by the Shareholder subject to clause 3.22 of this MOI, Companys power to issue cuarenlees, indomnties. secunly or to enler Into olher that bind the Ce ‘i aco ‘The Company may not — seue a guarantee, indemnity or securty; or ‘enter lato any other transactions that bind, or may bind, the Company or the Revenue Fund to any future financiat commitment, Lniess the provisions ofthe PFMA, In particular, section 66 thereof, aro complied with. ‘Financing and funding structures ‘The Board shall, In accordance with the PFMA and the Enabling Legislation, consider and dotermine the funding structures of the Company having regard to the funding requirements ‘of the Company from time to time. 62MEMORANDUM OF INCORPORATION Identiger | 65347868 16 PERSONAL FINANGIAL INTEREST AND DECLARATION BY DIRECTORS 16.4 162 16.3 16.3.1 16.3.2 16.3.3 16.3.4 163.5 1636 18.3.6.4 16.3.6.2 18.3.7 164 165 168 For purposes of this clause 16, "Director Inchides a Prescribed Officer and a person who is ‘a member of a connie of the Board, respective of whether of not the person Is also a member of the Board. ‘The Company shail establish 2 policy that wil deal with Personal Financial Interests and ‘conflicts of Interest of Directors and employees of the Company, which shall be consistent ‘with the provisions of the Companies Act and the PFMA, W a Director has a Personal Financial Inlerest or Knows that a Person Related to the Director, as described in section 2 of the Companies Act, has a Personal Financial Interest Inrespect of any matter to be considered by the Board, the Director: ‘must disclose tho interest and ite generat nature in Writing before the matter is ‘considered at the meeting; must disclose to the meeting any Material information relating to the malter, and that is known to the Director, may disclose any observations or pertinent insights refating to the matter If requested to do so by the other Directors; Present at the meeting of tho Board, must leave the meeting immediately after making any disclosure contemplated in clause 16.3.2 or 16.3.3 above; must not take part In the consideration of the matter, except to the extent of the disclosures contemplated In clauses 16.3.2 oF 16.3.3 above; ‘while absent from the meeting as provided In clause 16.3.4 above: - shall be regarded 26 belng Present at the meeting forthe purpose of determining ‘whether suffclent Directors are Presont to constitute a quorum of the meeting; shall not be regarded as belng Present at the meeting forthe purpose of determining whether @ resolution has sufficient support fo be adopted; and must not execute any document on behalf of the Company in telalion to the matter unless spedlicaly requested or rected to do so by the Board. if a Director of the Company acqures, or Knows thet a Related Person has acquired, Personal Financial Interest in an agreement or other matter In which the Company has a Material Interest, after the agreement or other matter has been approved by the Company, the Director shall promptly disclose to the Board, the nature and extent of that interest, and the Material circumstances relating to the Director or Related Person's acquisition of thal interest, as the case may be. IY, in the reasonable view of the other non-conficted Directors, a Director or the Related Person in respect of such Director, has a Materlal interest in the matter to be considered at the meeting of the Board, the Director shall only be entifed to such information concerning the matter to be considered at the meeting of the Boarci as shall be necessary to enable the Director to Klently that such Personal Financial Interest exists or continues to exist. ‘A decision by the Board, or a transaction or agreement approved by the Board, Is valid despite any Personal Financial Intorost of a Director or Person related to the Director, only it. = BSMEMORANDUM OF INCORPORATION Document | 240+ enter | essarase |” }° 186.1 Ik was approved following dlsciosure of that inerest In the manner contemplated in section 76 of the Companies Act or 16.6.2 _desplte having beon approved without disclosure of thal Personal Financial interest, It 166.24 has subsequently been ratified by an Ordinary Resolution of the Shareholder following disclosure of that Personal Financial interest; of 168.22 _has been declared to be valid by the court in terms of section 75(8) of the Companies 167 168 16.8 fat ‘A Director may at any time disclose any general Personal Financial interest in advance by delivering a Writien netlge to the Board sefting out the nature and extent of that interest for the purposes of this clause 16 until changed or withdrawn by such Director in Wrling. ‘A court, on application by any Interested Person, may deciare valid a transaction or ‘agreement that had been approved by the Board, or Shareholder as the case may be, despite the failure ofthe Diroctr to satity the requirements ofthis clause 16 and section 76 cof the Companies Act. “The provisions of this clause 18 do not derogate from those Directors’ duties prescribed by the PFMA and the Directors shall be required to comply both with the provisions of this clause 16 and the provisions of the PMA. 47 INDEMNIFICATION AND DIRECTORS! INSURANCE 174 72 1724 For the purposes of this clause 17, "Director" Inckides a former Director, @ Prosciibed ‘Officer, & person who la a member of a commiitee of the Board or of the audit committee of the Company, Irrespective of whether or not the person is also a member of the Board. Subject to the provisions of the PFMA, the Company may — not direclly or indirectly pay any fine that may be imposed on a Ditector, of on a Director of @ Related company, as a consequence of that Director having been convicted of an ‘offence In terms of any national legislation unless the conviotion le based on strict habilty;, 47.2.2 advance expenses to a Director to defend tigation in any proceedings arising out ofthe Director's service to the Company. For purposes of this clause 17, "service to the ‘Company? Includes services which are direally inked to the actviles of the Company, and services which the Company consents to or acknowledges; ond 47.2.3 direclly or indrectly indemnify a Director for ~ 472.84 any isbifty, other than in respect of ~ 172344 ‘any lablity arising In terms of section 77(3)(a), (b) or (c) of the Companies Act or ‘sections 86(2) oF (2) of the PFMA, or from wilful misconduct or wilful breach of ttust.on the part of the Director; or 723142 any fine contemplated In clause 17.2.1 above; 17.282 any expenses contemplated in clause 17.22 above, Irrespective of whether It hes advanced those expenses, ifthe proceedings — 172.824 ‘are abandoned or exculpate the Director; or 17.2322 atise in respect of any other fabifiy for which the Company may indemnify the Director In terms of clause 17.2.3.1 above. ‘nese ‘than cent en cco niente oan and dagen eel Nope ti Gael mb sued yh axed sea con i, xt ANY SO LM, Rg Me 20 6MEMORANDUM OF INCORPORATION besoe/anuntel| a Rev |o IWentifer | 65947869 17.3. Subject to the provisions of the: PFMA, the Company may purchase Insurance to protect — 17.3.1 a Director against any labilly or expenses contemplated in clause 17.22 or 17.2.3, above; or 17.3.2 the Company against any contingency including but not fimed to— 17.324 ‘any expenses — 173.244 that the Company Is permitted to advance in accordance with clause 17.2.2 above; or A732A2 for which the Company Is permitted to Indemnify a Director In accordance with clause 17.2.92 above; or 1732.2 any feblily for which the Compary is permited to Indemnlly a Director in accordance with clause 17.2.3.4 above. 474 The Company is enttied to claim restution from a Director or of a Related company for any ‘money paid directly or indirectly by the Company to or on behalf of that Director in any ‘manner inconsistent with section 76 of the Companies Act. 48 AUDITORS. 18.1 Subject to clause 18.2 of thls MOI, Audltors shall be appointed, and their duties regulated In accordance with the provisions of sections 90, 91, $2 and 93 of the Companies Act, the ‘Auditing Profession Act and applicable provisions of the Public Audit Act. 482 The Company shall not be required to appoint an Auditor for any Financial Year in respect of wiich the Audilor-General has elected, in terms of the Public Audit Act, fo conduct an Audit of the Company. 48.3 Subject fo the provisions ofthe Companies Act, the Audiing Profession Act and the Publ Aut Act, all acts done by any Person acting as Auditor, shell, as regard to all Persons dealing in good faith wih the Company, be vali notwitusianding that there was sore defect in that appointment, 184 Nothing precludes the election by the Company at its Annual General Meeting of an Auditor ‘other than one nominated by the audit committee referred to in clause 19 below, but if such an Auditors elected, the appolniment Is valid ony Ifthe aud committee Is satisfied that the proposed Auditor is indepondent of the Company. 185 in considering whether, for the purposes of the Companies Aci, @ Registered Ausitor fs Independent of the Company, the euelt cornmitee must — 485.1 ascertain that tho Aucllor does not receive any direct or Indtect remuneration or other benefit rom the Company, except— 185.14 as Auditor; or 48.5.1.2 for rendering othar services to the Company, to the extent permitted in terms of the: Companies Act; 48.5.2 consider whether the Auditor's independence may have been prejudiced — 185.24 as 2 result of any previous appoinimant as Auditor; or 165.22 having regard to the extent of any consultancy, acivisory or other work undertaken by the Auditor for the Company; and ‘rencontre a eh nt my nnn ean une Mapu th doen bootcut ne meted cane onc bales, a eg) 801, ap RDISETDMEMORANDUM OF INCORPORATION Death tt ae) Rev |0 identifer | 65347869 18.5.3 consider compliance with other orlteria relating to independence or conflct of intorest es 188 ‘proscribed by the Independent Regulatory Board for Aucitors established by the Auditing Profession Act, in relation to the Company, and Ifthe Company is @ member of & Group of Companies, any ‘other company within that Group of Companies. 49 AUDIT COMNITTEE 19.4 192 18.3 10.4 19.5 1968 197 In terms of section 84 of the Companies Act, the Board shall propose, ond the Shareholder shall appolnt, en aut committe. In the event thal the Shareholder elects noto appoint any person proposed by the Board tothe audit commitiz, the Board shall propose an alternate person for appointment bythe Shareholder. “The audit commitiee shall comprise at leest 5 (three) members, all of whom shall, subject to clauses 19.5 and 19.6 below, be nor-execulive Directors of the Company and whose ‘appokitment shalt comply with ()) section 77 of the PFMA read wth the Treasury Regulations; and (i) to the extent thatthe provisions of seotion 94(5) of the Companies Act and Regulation 42 do not confict with section 77 of the PFMA read wilh the Treasury Regulations, section 94(6) of the Companies Act and Regulation 42. “The aueit committee shall mest at least 4 (four) mes in a yeer to execute its duties. ‘The Board shall, subject to clause 19.5 below, propose a chaitperson for the aut committee, for approval by the Shareholder at the Annual General Meeting. In accordance with the Treasury Regulations the chairperson of the audit commitee shatl be independent, be knowledgeable of the status of the position, have the requisite business, financial and leadership skills and may not be the chairperson of the Board or @ person who fulfls an exeoulive function in the Company. ‘Each member of the aucit committee must — sallefy any applicable requirements prascilbed by the Minister of Trade and indusiy from time to time in terms of section 94(5) of the Compantes Act, 1974 notbe~ 19.744 involved in the day-to-day management of the Company's business of have been so involved at any time during the previous Financial Year, 10:7.4.2 a Prevoribed Officer, or full-time employee, of the Company or another Related or Inter-Related Person, or have been such an Officer or employee at sny time during the previous 3 (twee) Financial Years; or 19.7.13 ‘a Material supplier or customer of the Company, such that a reasonable and informed thied parly would conclude in the circumstances that the Integrity, impertaity or objeclivty ofthat Director Is compromised by that relationship; and 49.7.2 not be a Relaled Person to any person who falls within the criteria in clauses 19.7.4.1 19.8 199 to 19.7.1.3 above. “The Board must eppolnt a person to fil any vacancy on the audit committee within 40 (forty) Business Days after the vacancy arises. ‘The aucit committee shail execute all the functions as may be prescribed from lime to time by the Companies Act (as read with the Regulations) and the PFMA (as read with the ‘Treasury Regulations). ‘Yon encode ob nce annem ei i deena bere Ww a aT A ‘tad fanamebeoramn ‘pate ant yb ect en nd ren ey i em ee SOC Rg EDDIE &MEMORANDUM OF INCORPORATION Document | 240- Identifier | 65247860 19.10 10.41 19.12 ‘The Company may determine that Its audit committee wil perform the functions required by section 94 of the Companies Act on behalf ts Subsidiaries, “The Company must pay all expenses reasonably incurred by iis audit committee, Including, if the audit committee considers it appropriate, the fees of sny consukant or spectalst engaged by the aust coriltee to assitit in the performance of lis functions. ‘No person shall be elected as a member of the audit commitie, If sihe 1s Inelghble or Disqualified and any such election shall be a nully. A person who is ineligiole or Disqualified must not consent to be elected as a member ofthe auelt committee nor act as @ rember ofthe audit committee. A person placed under probation by a court must not serve ‘as ¢ member ofthe audit comrnites unless the order of court so permit 20 SOCIAL AND ETHICS COMMITTEE 20.4 202 208 204 20.6 208 20.8.1 208.2 208.3 2084 208.6 207 In terms of section 72 (4) of the Companies Act, the Board must appoint @ social and ethics ‘committee unless f has been exempted in terms of the Companies Act from having to have 1 social and ethics commities. ‘The Company may determine that its social and ethics committee wil perform the functions required by Reguiaton 43 on behaif of ts Subsidiaries, ‘The social and ethics committee shall comprise al foast 3 (three) members, all of whom shall be Directors of the Company, at least + (one) of whom must be a Dieclor who is not involved in the day-to-day management of the Company's business, and must not have been co Involved within the previous 3 (three) Financial Years and whose appointment shall be In compliance with the Gompanies Act and envy regulations published thereunder. “The social and ethics committee shall meet at least once « year to dea! with and attend to all functions and matters that are required to be dealt with by the committee in terms of the Companies Act and any regulations published thereunder. “The soctal and ethics commiltee shall execute all the functions as may be proscribed from ‘ime to time by the Companies Act (as read with the Regulations) end the PFMA (as read with the Treasury Regulatlone), ‘The social and othios commities of the Company is ented to ‘require rom any Director or Presorbed Oiticar any information or explanation necessary {or the performance ofthe committee's functions; request from any employee of the Company any information or explanation necessary for the performanes of te committee's functions; altend any Sharchotier's Meeting; receive all nolices of and other communications relating to any Shareholder’s Meeting; and ‘be heard at any Sharcholder's Meeting on any part of the business of the meeting that ‘concerns the committee's functions. The Company must pay all the expenses reasonably Incurred by Its soclal and ethics ‘committee, Including, Ife soctal and ethics committee considers It appropriate, the costs or the fees of any consultant or specialist engaged by the social and ethics committee in the porformance of Rs functions, oer ptt oman bobcat nk weit eo cae Sea ei SOCAL go OSES 6MEMORANDUM OF INCORPORATION Rev 0 Identiter | 65347869 21 BOARD COMMITTEES 214 Other then the statutory committees of the Aucit Committee and the Social and Ethics Commitlge the Board may, in terms of section 72 of the Companies Act, establish Standing Committees and Ad Hoc Committees. 212 The Minister takes cognisance ofthe Standing Committees established by the Board as set ‘out in clause 21.4 below, however should the Board wish to establish new Standing Committees, such committees may only be established with the prior Witten consent ofthe Minister. 21.3 Furthermore, in the application by the Board to the Minister of a new Standing Commitee, the Board must submit Whiten terms of reference including inter alfa the need for such a committee, the functions of the commits and any other Information required by the Minister, The number of Directors appointed to serve on the commities wil be al the discretion of the Minister. 214 Standing Committees at date of this MOI (in addition to those required by the Companies ‘Act) include: 2141 People & Goveance committee; 2142 Tender committee; 244.3 Investment and Finance committee; and 214.4 Risk Committee 21.6 No person shall be appointed as a member of a Board committee, if s/he Is Ineligtole or Disqualified and any such appointment shall be a nullly. A person who is Ineligible or Disqualified must not consent to be appointed as a member of a Board committee nor act as ‘such a member. A person placed under probation by a court must not serve as a member ‘of @ Board committee uniess the order of court so permit. 21.8 — Meetings of a commitiee of the Board shall be governed by the provisions of this MOI regulating the meetings and proceedings of Directors, 22 PRESCRIBED OFFICERS 22.4 No person shall hold office as 2 Presoribed Officer i stho 1s Ineligble or Disqualified. A person who is Ineligible oF Disqualified rust not consent to be eppointed to an office of ‘undertake any functions which would result in herthim being a Prescribed Officer nor act In ‘such office nor undertake any such functions. person placed under probalion by & court ‘must not consent te be appointed to an office or undertake any functions which would resuit in herthim being a Presctlved Offcer nor ec in such office nor undertake any such functions unless the order of court so permits. 22.2 Prescribed Officar chai! cease to hold office as such immediately sthe becomes tnoligie ‘or Disqualified In terms of the Companies Act. 23. COMPANY SECRETARY 23.1 The Board must appoint the company secretary from time to timo, who ~ 2311 shall be a permanent resident of the Republic and remain so while serving as company secretary; and nn cine en emi ncn ne cet ed ne epee eer enna RE Sha teattestonnen pot etie drama posta vod esi! eet poh habe: x ets 2001 hy Ho DET[MEMORANDUM OF INCORPORATION rele Rev |0 IWentifer | 65347858 28.1.2 shall have the requlste knowledge of, or experience in, relevant laws; and 23.4.3 may be a Juristic Person subject tothe following: 294.84 every employee of that Jurisle Person who provides compeny secretary services, or partner and employes of that partnership, as the case may be, Is not ineligible or Disqualtied; 23.4.32 _alloast 4 (one) employee of that Juristc Person, ar one pariner or employee of that 232 233 234 partnorchip, as the case may be, salisfies the requirements in clauses 23.11 and 23.1.2 above. “The company secretary shall not be @ Director, ‘Within 60 (sixty) Business Days affer © vacancy arises In the office of company secretary, the Board must fil the vaeanoy by eppointing 2 Person whom the Board considers to have the requisite knowledge and experience. A change in the membership of a Juris ic Person ‘or partnership that holds office as company secretary does not constitute a vacancy tn the ‘office of company secretary, f the Juristic Person or partnership continues to satisfy the requirements of cause 23.1.3 above. If at any time a Jutistle Person or partnership holds office as company secretary of the ‘Company — 23.4.1 the duristic Person or partnership must Immediately notify the Board If the Juristic Person cor partnership no longer safisfies the requirements of clause 28.1.3 above, and is regarded to have resigned as company secretary upon giving that notice to the Company; 23.4.2 the Company Is entitled to assume that the Juratic Person or partnership satisfies the requirements of clause 23.1.3 above, unt the Company has tecelved © notice ‘contomplated in clause 23.4.1 above; and 23.4.3 any action taken by the Jurletic Person or partnership in performance ofits functions as. 238 236 ‘company secretary is not invalidated merely because the Juristic Person or partnership had ceased to satlay the requirements of cause 23.1.3 above af the time ofthat action. ‘The company secretary may resign from office by giving the Company 1 (one) month's \Wilten notice of less than that with the prior Witten approval of the Board, Ifthe company secretary is removed from office by the Board, the company seoretary may, by giving Writen notice to that effect to the Company by not fater than the end of the Financial Year In which the removal took place, requrre the Company to include a statement in te annual Finenciat Statements relating to that Financial Year, not exceeding a reasonable length, setting out the company secretary's contention as to the circumstances that resulted in the removal, The Company must include this statement in the Directors! report ints annual Financia! Statements, 24 DISTRIBUTIONS TO THE SHAREHOLDER 244 ‘The Board may make Distributions to the Shareholder from time to time in accordance with ‘tho Enabling Legislation and the Distributions or similar polcy of the Company, subject to the provisions of clauses 13.1.1.10 and 24 of this MOI, the provisions of section 46 of the Companies Act and eny applicable provisions of the PFMA. toe donot inn doe anagem ne apes ain lee Ht Aan ¥4 pri enon nab phen whe eed can en cathy, Har SOLA Ret RRNADooument | 240- MEMORANDUM OF INCORPORATION Kentter, lesaarase |REY [° 242 The Board, after Consultation with the Shareholder, shell develop an appropriate Distribution or similar policy and fremework for the Company taking Into account, intr ala, the Corporate Pian and strategic objectives which shal be reviewed on 2 reguiar basis. In ‘addition, the Company shall be entiled to Invest sutfclent funds of the Company fer the adoquele captaisation and on-golng Investment in Subsidiaries deemed appropriate. Such captalsation or investment, and expenditure Incurred In respect of Industry restructuring, delivery of universal services ot eny other socio-economic activites cartied out by the ‘Company upon the request of the Shareholder shall be taken Into account in calculating any Distribution and other payments payable to the Shareholder. 243° Without derogating from the provisions of clause 24.1 above and subjoct to the requirements of the Companios Act and clause 13.1.1.10 of this MOI, the Board may resoN0 to Distribute o deal with, in any way authorised by the Companies Act, all or any ‘part ofthe amount forthe time being standing tothe crecit of any of the Company's reserves: for any share captal ofthe Company. 25 ACCOUNTS 26.1 The Board shall cause to be Kept such Accounting Records and books of account as are prescribed by the Companies Act and the PFMA. 25.2 The Financial Statements, books of account and other books and documents of the Company shall be Kept at, or be accessible from, the Office of the Company oF (subject to the provisions of section 28 of the Companies Act, and the PFMA) at such other place as the Board thinks fit, and shall be open to Inspection by the Shareholder and the Board during nonmal business hours. 26.3 The Board shal, in accordance with sections 30 and 31 of the Companies Act and section 56 of the PFMA, cause to be prepared and presented at the Company's Annual General Meeting such reports as are referred to in those sections and required in terms of this MOI. 264 Subject to the provisions of the Compantas Act, @ copy of the documents referred to In Clause 26.3 above shall be Delivered or sent by post to the registered address of the Shareholder atleast 16 (§iteen) Business Days before the Annual General Meeting, 80 that such period shall not include the day on which such documents are Dolivered or sent, or deemed to be Delivered or sent, oF the day on which the meeting Is to be held. ‘Atemnatvoly, the Shareholder may gle the Company an Eiectronic Adkress in which case a ‘copy of the sald documents may be Delivered to the Shareholder at tha address. 26 NOTICES 26.1 Notices and documents required to be published as contemplated In sections. 16(3)@) or 47¢4)(a) of the Companies Act shall be Delivered by the Company to the Shareholder by hand delivery to the registered address of the Shareholder or by transmission through the post in a prepaid fetter, by telefex or any Electronic Communicefion addressed to the ‘Shareholder at ts registered address or Electronic Address (as the ease may be). 26.2 The Shareholder chooses the address of the permanent office of the Shareholder in Pretoria as lls registered address or such ofher address (Including an Electronic Address) as the ‘Shareholder shall upon Written notice be entitled to change. 26.3 The Shareholder afler having furnished an Electronic Ad¢rees to the Company, by doing so ‘eet ete nuendo sna em rey are ao enaN AABN tiepnott ocean ny be ahead Peete co nme Et rn SOG a 0SMEMORANDUM OF INCORPORATION Looe teers Rev |o Identiter | 65347858 26.3.1 authorises the Company to use Electronic Communication to give notices, documents, Records or statements or notices of avaltabilily of the aforegoing to It; and 26.3.2 confirms that eame can conveniently be printed by the Shareholder within a reasonable ‘ime and at a reasonable cost 284 Every notice caling any general meeting shall comply with the provisions of the Companies Act unless otherwise determined by the Board, 27 FINANCIAL YEAR ‘The Financial Year of the Company is the 12 (twelve) Month petiod ending on 31 March of ‘each year, The Financial Year may not be changed by the Board without the prior Written ‘consent of approval of the Shareholder and subject to the PFMA and the requirements of section 27(4) of the Companies Act. 28 WINDING UP Subject fo the provisions of the Companies Act, the Company shall not be wound up or be placed into ‘business rescue" as contemplated in the Companies Act without the prior Weitten ‘consent of the Shareholder. 29 SUBSIDIARIES ‘The Company may, from time to time, form or acquire further Subsidiaries, eubject fo tho provistone of this MOI, the PFMA and the Enabling Legislation. 30 PROTECTION OF WHISTLE-BLOWERS ‘The Company shell establish and maintain a system lo receive disclosures contemplated In section 169 of the Companies Act Saiaannesbeapue ps domes be bat ne nd ene eae am Mgt SO Rg Ho sBRDSI2 GPage 1 JS 1 oe REVISED RULES OF THE ESKOM PENSION AND PROVIDENT FUND: rs ao) - CONTRIBUTIONS et Mempers’ CONTRIBUTIONS ~ 17 (1) Subject to the provisions of this rule and rule 19, every MEMBER shall contribute to the FUND 7, 3% of his PBNSIONABLE EMOLUMENTS. (2) No contributions shall be payable by a MEMBER for any period of SERVICE after attaining the PENSIONABLE AGE, i (3) A MEMBER’S contributions shall be deducted by his EMPLOYER from his salary or wages and paid to the FUND as prescribed in the ACT. (4) For any mouth an EMPLOYER may, for the purposes of subsection (5), "recognize a date during that month in respect of each of its business units as the “out-off date” in that month for that business unit, (5) _If, in the month in which a person becomes or ceases to be a MEMBER, he ~ isa MEMBER in the SERVICE on the cut-off date for the business unit in which he is employed, his contribution for thet month shall be equal to the contribution that he would have paid if he had been 2 MEMBER in the SERVICE throughout that month; otherwise, no contribution shall be payable by him for that month, ADDITIONAL CONTRIBUTIONS 18 (1) A MEMBER may undertake to pay voluntary contributions to the FUND forthe purpose of adding such additional benefits as the BOARD, in terms of this rule, determine, (@) A record shall be maintained in respect of each MEMBER’S voluntary as contributions, to which, after deduction of any administration expenses, shall be added such interest and bonus as the BOARD, acting on the advice ca of the ACTUARY, determine. 4,i ® ® - © cae (6) neo OY Ifa MEMBER retires or is retired from the SERVICE and becomes entitled to a PENSION or if a MEMBER dies and a PENSION becomes payable in respect of hit, the amount of the voluntary contributions accumulated with. interest and bonus in terms of subsection (2) of this rule shall be utilized to provide such additional PENSION as the BOARD, after consulting the ACTUARY, determine. Provided that the BOARD may commute for a Jump sum the whole or part of the PENSION subject to the provisions of rule 27, ‘Ifa MEMBER leaves the SERVICE in circumstances in which he becomes ‘entitled to a lump sum benefit in terms of rule 28, or if a MEMBER dies and no PENSION becomes payable in respect of him, the amount of his Voluntary contributions accumulated with interest and bonus in terms of subsection (2) of this rule shall be added to the lump sum benefits payable {o or in respect of hima. Ifa MEMBER leaves the SERVICE in circumstances in which he becomes entitled to @ lump sum benefit in terms of rule 29 or 30, the amount of his voluntary contributions accumulated with interest in terms of subsection @) of this rule shall be added to the lump sum benefit payable to or in respect of him A DEFERRED PENSIONER who has made an election in temas of rule 28(2), 29(2) or 30(2) and who bas attained the age of 55 years may elect to receive in eash not more than one-thitd ofthe amount of the voluntary contributions accumulated with interest and bonus in terms of subsection (2) mutatis mutandis, subject to the provisions of rule 27. The balance shall be utilized to provide him with a PENSION as set out in paragraph (@), (©) or (e) below, whichever is applicable: @ If the DEFERRED PENSIONER is a Partner to a MARRIAGE at the date of commencement of the PENSION, provision shall be made for a PENSION equal to 60 per cent of the DEFERRED lbco) ~ q PENSIONER’S PENSION to become payable to and for the lifetime of the DEPERRED PENSIONER’S. WIDOW or WIDOWER on the DEFERRED PENSIONER'S subsequent desth, provided such WIDOW or WIDOWER is the person to whom the former MEMBER was married at the date the PENSION commenced; or (by If the DEFERRED PENSIONER is not a partner toa MARRIAGE at the date of commencement of the PENSION, such PENSION shall cease on the subsequent death of the DEFERRED PENSIONER; or © Irrespective of whether the DEFERRED PENSIONER is a partner to a MARRIAGE at the date of commencement of the PENSION, if there are ELIGIBLE CHILDREN, provision shall be made for PENSIONS to be payable to such ELIGIBLE CHILDREN on terms equivalent to those set out in rule 26. If he dies before such amount hes been utilized, it shall be used by the BOARD, to provide lump sum benefits for his dependants subject to the provisions of section 37 C of the ACT. Whenever additional benefits are provided In terms of this rule, the BOARD shall, after consulting the ACTUARY, determine the period of SERVICE in respect of which such benefits are provided. Where such SERVICE is determined in respect of payments made in terms of subsection (1) it shali be PENSIONABLE SERVICE only if the MEMBER becomes entitled to an immediate PENSION in terms of these RULES. If auch SERVICE is determined in respect of a MEMBER. who has made an election in terms of rule 28, 29 or 30, such SERVICE shall be PENSIONABLE SERVICE only for the purpose of rule 26 (3) (b). B® o (10) ay Page 42 ‘Whenever a PERFORMANCE BONUS is: paid to a MEMBER, his EMPLOYER shall deduct from it an amount equal to the contribution that the MEMBER would in terms of these RULES have been required to make in respect of that bonus had it ‘been a payment of PENSIONABLE EMOLUMENTS. At the specific request of the EMPLOYER in respect of a ‘MEMBER, and subject to the agreomont of the BOARD to such specific request, subsections (9), (10) and (11) shall apply mutatis mutandis in respect of a THIRTEENTH CHEQUE paid to such MEMBER. Whenever an EMPLOYER deducts an amount from a PERFORMANCE, BONUS or THIRTEENTH CHEQUE in terms of subsection (8), he shall pay such amount to the FUND, together with the amount that he would in terms of these RULES have been required to contribute in respect of that bonus had it been a payment of PENSIONABLE EMOLUMENTS Any amount paid to the FUND in terms of subsection (9) shall be deemed to be a voluntary contribution paid by the MEMBER on the date on which the PERFORMANCE BONUS or THIRTEENTH CHEQUE is paid. In the determination of an amount to be paid to a MEMBER on the winding up of the FUND in terms of rules 44 or 45, account will be taken of the amount of his voluntary contributions, if eny, in terms of subsection Q) of this rule CONTRIBUTIONS DURING LEAVE. 19 A MEMBER who is on Jeave with full pay or with pay less than full pay or without pay or is temporarily laid off without pay shall continue during the period ‘of such leave or lay-off to contribute on his full PENSIONABLE EMOLUMENTS before such leave or lay-off. Ae~ 17 20 deleted EMPLOYERS? CONTRIBUTIONS. 21 (1) Each EMPLOYER shall contribute to the FUND, subject to the provisions of rule 17 (5) mutetis mutandis and of rule 36, amounts equal to 12,25% of the PENSIONABLE EMOLUMENTS of those of his employees who are MEMBERS and in addition 1,25% of the PENSIONABLE EMOLUMENTS of those of his employees who are 1976, C and 1987 MEMBERS; provided thatthe contributions payable by the EMPLOYERS may be reduced for such period and by such amounts as, on the advice of the ACTUARY, the BOARD, with. the concurrence of ESKOM, may decide, The EMPLOYERS’ contributions together with the corresponding contributions deducted from the salaries and wages of the MEMBERS shall bbe paid directly to the FUND within a period of seven days after the expiry of the period in respect of which the contributions are being paid, The BOARD shall, not later than the first business day following the day on which the FUND received the contributions, deposit the contributions in the banking account operating in the name of the FUND jn terms of rule 33(1), (2) An EMPLOYER shall pay to the FUND in respect of PENSIONS granted in terms of RULE 28(1), (2), (3) or (4) such portion of the amount estimated by the ACTUARY as required to cover the additional liability incurred by the granting of such PENSIONS to MEMBERS in his SERVICE ) The EMPLOYERS may make special payments to the FUND of such amounts as ESKOM may from time to time determine, on the advice of the ACTUARY, to provide the benefits prescribed herein. (4) Av EMPLOYER may make a special payment to the FUND in order to add to the PENSIONABLE SERVICE of a MEMBER in his employ such iy~ 4 period of past SERVICE as the BOARD, after consulting the ACTUARY, determine.: % BENEFITS PENSION RATE 22 Subject to these RULES, the annual PENSION payable to a retired MEMBER. shall be 1,085/600 of his FINAL AVERAGE EMOLUMENTS per month of PENSIONABLE SERVICE. RETIREMENT AT THE PENSIONADLE AGE 23 A MEMBER who has atteined the PENSIONABLE AGE shall retire from the SERVICE and cease to be a MEMBER. EaRLY RETIREMENT 24 — Notwithstanding the provisions of mie 23, a MEMBER may retire from the SERVICE after attaining the age of $$ ‘years, in which case he shall be entitled, as from the date of his retirement, to « PENSION in. respect of his PENSIONABLE SERVICE to the date of retirement calculated in terms of rule 22 reduced by a factor equal to thirteen-fortieths of one ‘per cent for each month by which the Period from the date of his retirement to the date on which he would have-attsined the PENSIONABLE AGE exceeds. ‘twenty-four months. The reduction factor may be waived at the discretion of the EMPLOYER subject to the payment to the FUND by the EMPLOYER of an amount determined by the ACTUARY as ‘required to cover the additional liability so incurred by the FUND, Tu-HEALTH RETIREMENT Definition of “Disabled” 25 (1) _ For the purposes of this rule, “disabled” means, on a balance of Probebilities, a MEMBER who is stil! in SERVICE and who is permanently incapable as a result of infirmity of body or mind, of performing the duties of — 6,