Limited PROGRAMME MEMORANDUM ON

Limited PROGRAMME MEMORANDUM ON P R E F E R E N C E S H A R E P R O G R A M M E

Limited Disclaimer: This document is not an advertisement but is provided exclusively for information purposes and should not be regarded as an offer or solicitation to purchase, sell or otherwise deal with any other particular investment. While we have taken and will continue to take care that the information contained herein is true and correct, we do not guarantee the accuracy, timeliness or completeness of the information provided, and therefore disclaim any liability for any loss, liability, damage (whether direct or consequential) or expense of any nature whatsoever which may be suffered as a result of or which may be attributable, directly or indirectly, to the use of or reliance upon the information. The document is protected by copyright and may not be copied, reproduced, sold or distributed without prior written consent. * Terms & Conditions apply B

CONTENTS CORPORATE INFORMATION 6 DOCUMENTS INCORPORATED BY REFERENCE 8 GENERAL DESCRIPTION OF THE PROGRAMME 9 SUMMARY OF THE PROGRAMME 10 TERMS AND CONDITIONS OF THE PREFERENCE SHARES 16 PROCEDURES FOR ACCEPTANCE 31 PRO-FORMA APPLICABLE PRICING SUPPLEMENT 35 DEFINITIONS AND INTERPRETATIONS 38 RISK FACTORS 47 USE OF PROCEEDS 53 DESCRIPTION OF THE ISSUER 54 CORPORATE GOVERNANCE 68 SETTLEMENT, CLEARING AND TRANSFERS 76 SOUTH AFRICAN TAXATION 78 EXCHANGE CONTROL 82 SUBSCRIPTION AND SALE 83 GENERAL INFORMATION 87 ANNEXURE 1 DIVIDENDS TAX DECLARATION AND EXEMPTION 91 1

Ecsponent Limited (Incorporated in the Republic of South Africa, under registration number 1998/013215/06 (the Issuer or Ecsponent ) Limited ZAR5,000,000,000 PROGRAMME MEMORANDUM ON PREFERENCE SHARE PROGRAMME Under this Preference Share Programme (the Programme ), Ecsponent may from time to time issue preference shares (the Preference Shares ) denominated in South African Rand, on the terms and conditions contained in the section of this Programme Memorandum headed Terms and Conditions of the Preference Shares. Capitalised terms used below are defined in the section of this Programme Memorandum headed Definitions and Interpretations. This Programme Memorandum will apply to Preference Shares issued under the Programme in an aggregate nominal amount which will not exceed ZAR5,000,000,000 unless such aggregate nominal amount is increased as set out in the section of this Programme Memorandum headed General Description of the Programme. This Programme Memorandum has been approved by the JSE. The Preference Shares may comprise fixed rate Preference Shares (Class A Preference Shares and/or Class G Preference Shares), zero rate Preference Shares (Class B Preference Shares) or variable rate Preference Shares (Class C Preference Shares). The Preference Shares will be issued in individual Tranches which, together with other Tranches, may form a Series of Preference Shares. Each Tranche of Preference Shares will be subject to the Terms and Conditions contained in this Programme Memorandum, provided that the Applicable Pricing Supplement relating to a Tranche of Preference Shares may specify other terms and conditions, which may replace, modify or supplement the Terms and Conditions. Details of a particular Tranche of Preference Shares, and the additional terms and conditions specific to that Tranche of Preference Shares, including, inter alia, and if applicable, the Issue Price, the Dividend Rate, the Redemption Amount and the Redemption Date, will be specified in the Applicable Pricing Supplement. Each Tranche of Preference Shares may be listed on the JSE or on such other or further exchange(s) as may be determined by the Issuer and subject to any Applicable Laws. With respect to a Tranche of Preference Shares listed on the JSE, the Applicable Pricing Supplement relating to that Tranche of Preference Shares will be delivered to the JSE and Strate before the Issue Date, and the Preference Shares in that Tranche may be traded by or through members of the JSE from the date specified in the Applicable Pricing Supplement. The trading of Preference Shares listed on the JSE will take place in accordance with the rules and operating procedures for the time being of the JSE. The settlement of trades on the JSE will take place in accordance with the electronic settlement procedures of the JSE and Strate. The settlement and redemption procedures for a Tranche of Preference Shares listed on another exchange, irrespective of whether that Tranche is listed on the JSE as well, will be specified in the Applicable Pricing Supplement. Preference Shares may be issued on a continuing basis and be placed by one or more Dealers appointed by the Issuer from time to time, which appointment may be for a specific issue or on an ongoing basis. Neither the Programme nor the Preference Shares are rated. 2

The Preference Shares will be obligations solely of the Issuer and are unsecured. The Preference Shares will not be obligations of, or the responsibility of, or guaranteed by any person other than the Issuer. No liability whatsoever in respect of any failure by the Issuer to pay any amount due under the Preference Shares will be accepted by any party other than the Issuer. Prospective purchasers of Preference Shares issued under the Programme should pay particular attention to the section of this Programme Memorandum headed Risk Factors. The price/yield and amount of a Tranche of Preference Shares to be issued under the Programme will be determined by the Issuer at the time of issue in accordance with prevailing market conditions With effect from the Programme Date, this Programme Memorandum is an update of the Programme Memorandum dated 8 September 2014 and therefore replaces the Programme Memorandum dated 8 September 2014. The Conditions of any Preference Shares issued before the Programme Date are not amended by any amendments to the Programme Memorandum. Further copies of the Programme Memorandum This Programme Memorandum can be obtained during normal office hours at the registered office of the Issuer and is available on the Issuer s website, www.ecsponent.com, as well as on the JSE s website, www.jse.co.za. Corporate Advisor and JSE Debt Sponsor Questco (Pty) Ltd Auditors Programme Memorandum dated 15 December 2015 3

IMPORTANT INFORMATION The definitions and interpretations commencing on page 30 of this Programme Memorandum apply to this section on Important Information. GENERAL This Programme Memorandum is to be read in conjunction with all documents which are deemed to be incorporated herein by reference. This Programme Memorandum shall be read and construed on the basis that such documents are incorporated into and form part of this Programme Memorandum. Refer to the section headed Documents Incorporated by Reference for a list of these documents. None of the Corporate Advisor and JSE Debt Sponsor, the Legal and Tax Advisor or any of their respective subsidiaries or holding companies or a subsidiary of their holding company (affiliates), other professional advisers named herein nor the JSE have separately verified the information contained herein. Accordingly, no representation, warranty or undertaking, express or implied, is made and no responsibility is accepted by the aforementioned parties as to the accuracy or completeness of the information contained in this Programme Memorandum or any other information provided by the Issuer and they do not accept any liability in relation to the information contained in this Programme Memorandum or any other information provided by the Issuer in connection with the Programme. No Person has been authorised by the Issuer to give any information or to make any representation not contained in or not consistent with this Programme Memorandum or any other document entered into in relation to the Programme or any other information supplied by the Issuer in connection with the Programme and, if given or made, such information or representation must not be relied upon as having been authorised by the Issuer or any of the other parties referred to in this document. Neither this Programme Memorandum nor any other information supplied in connection with the Programme is intended to provide a basis for any credit or other evaluation, or should be considered as a recommendation by the Issuer, the Corporate Advisor and JSE Debt Sponsor or the Legal and Tax Advisor or other professional advisers that any recipient of this Programme Memorandum or any other information supplied in connection with the Programme should subscribe for, or purchase, any Preference Shares. Each Person contemplating the subscription for, or purchase of, any Preference Shares should determine for itself the relevance of the information contained in this Programme Memorandum and should make its own independent investigation of the financial condition and affairs, and its own appraisal of the creditworthiness of the Issuer and its subscription for, or purchase of, Preference Shares should be based upon any such investigation as it deems necessary. Neither the delivery of this Programme Memorandum nor any Applicable Pricing Supplement, nor the offering, sale or delivery of any Preference Shares shall at any time imply that the information contained herein is correct at any time subsequent to the date hereof, or that any other financial statements or other information supplied in connection with the Programme is correct at any time subsequent to the date indicated in the document containing the same. The JSE Debt Sponsor, Legal Advisor and other professional advisers expressly do not undertake to review the financial condition or affairs of the Issuer during the life of the Programme. Investors should review, inter alia, the most recent financial statements of the Issuer when deciding whether or not to subscribe for, or purchase, any Preference Shares. 4

RESPONSIBILITY STATEMENT The Issuer certifies that to the best of its knowledge and belief there are no facts that have been omitted which would make any statement false or misleading and that all reasonable enquiries to ascertain such facts have been made as well as that the Programme Memorandum contains all information required by Applicable Law and the JSE Debt Listings Requirements. The Issuer accepts full responsibility for the accuracy of the information contained in the Programme Memorandum, except as otherwise stated therein. The listing of any Tranche of Preference Shares on the JSE or elsewhere is not to be taken as an indication of the merits of the Issuer or the Preference Shares. The JSE takes no responsibility for the contents of the Programme Memorandum (as amended or restated from time to time), or the annual report of the Issuer or the amendments to the annual report, makes no representation as to the accuracy or completeness of any of the foregoing documents and expressly disclaims any liability for any loss arising from or in reliance upon the whole or any part of the Programme Memorandum. The JSE expressly disclaims any liability for any loss arising from or in reliance upon the whole or any part of this Programme Memorandum or any Applicable Pricing Supplement or the annual financial report or any other information incorporated by reference into this Programme Memorandum (as amended or restated from time to time). OFFERS IN SOUTH AFRICA ONLY This Programme Memorandum has been prepared for the purposes of complying with the Companies Act and the Regulations published in terms thereof and the JSE Debt Listings Requirements and the information disclosed may not be the same as that which would have been disclosed if this Programme Memorandum had been prepared in accordance with the laws and regulations of any jurisdiction outside of South Africa. This Programme Memorandum has been issued in connection with the offering of the Preference Shares in South Africa. The distribution of this Programme Memorandum and the making of an offer for the Preference Shares may be restricted by law in certain jurisdictions. Persons into whose possession this Programme Memorandum comes must inform themselves about and observe any and all such restrictions. This Programme Memorandum does not constitute an offer of or invitation to subscribe for and/or purchase any such Shares or Preference Shares of the Company in any Affected Jurisdiction. No one has taken any action that would permit a public offering of Preference Shares to occur in an Affected Jurisdiction. Neither the Preferences Shares nor the Programme Memorandum have, nor will they be, registered under the US Securities Act, 1933 or with the regulatory authority of any state or jurisdiction of an Affected Jurisdiction and may not be offered, sold, pledged or otherwise transferred in an Affected Jurisdiction or to any national, resident or subject of an Affected Jurisdiction where any such offer, sale, pledge or transfer is prohibited. Neither this document nor any copy of it may be sent to or taken into an Affected Jurisdiction where the distribution of the prospectus is prohibited. 5

CORPORATE INFORMATION Registered address: Limited Acacia House Green Hill Village Office Park Cnr Botterklapper & Nentabos Streets The Willows, Pretoria East PO Box 39660, Garsfontein East, 0060 Date of incorporation of Ecsponent 09 July 1998 Place of incorporation of Ecsponent Johannesburg, South Africa Company secretary Timbavati Business Consultants Proprietary Limited (Registration number 2015/103289/07) Acacia House Green Hill Village Office Park Cnr of Nentabos and Botterklapper Street The Willows Pretoria East, 0181 (PO Box 39660, Garsfontein East, 0060) Debt Sponsor and Corporate Advisor Questco Proprietary Limited (Registration number 2002/005616/07) The Pivot Entrance D, 2nd Floor No. 1 Montecasino Boulevard Fourways, 2055 (PO Box 98956, Sloane Park, 2152 6

Legal and Tax Advisors Webber Wentzel 10 Fricker Road, Illovo Boulevard Johannesburg, 2196 (PO Box 61771, Marshalltown 2107) Auditors Nexia SAB&T Chartered Accountants Inc. 119 Witch-Hazel Avenue, Highveld Technopark Centurion Pretoria (P.O. Box 10512, Centurion, 0046) Transfer Secretaries Link Market Services South Africa (Pty) Ltd (Registration Number: 2000/007239/07) 13th Floor Rennie House, 19 Ameshoff Street, Braamfontein, 2001 (PO Box 4844, Johannesburg 2000) Banker First National Bank 1 First Place Corner Simmonds and Pritchard Street Johannesburg, 2001 (P.O. Box 1153, Johannesburg, 2000) 7

DOCUMENTS INCORPORATED BY REFERENCE Words used in this section headed Documents Incorporated by Reference shall bear the same meanings as used in the section headed Definitions and Interpretations and as defined elsewhere in this Programme Memorandum, except to the extent that they are separately defined in this section or the context otherwise requires. The documents listed below are deemed to be incorporated in, and to form part of, this Programme Memorandum: i) the audited annual financial statements and annual report of the Issuer for the financial years ending 30 September 2012 and 31 December 2013 and 2014, together with such statements, reports and notes to be read with such financial statements, and in respect of the Preference Shares issued after the date of the Programme Memorandum, the financial statements and notes thereto in respect of further financial years, as and when such financial statements become available; ii) iii) iv) the unaudited interim financial statements of the Issuer, together with such statements, reports and notes to be read with such unaudited interim financial statements, for the period ended September 2012, June 2013, June 2014 and June 2015, and in respect of any issue of Preference Shares after the date of the Programme Memorandum, the unaudited interim financial statements, and notes thereto, in respect of further financial years, as and when such interim financial statements become available; all information pertaining to the Issuer which is relevant to the Preference Shares and which is electronically disseminated on the Stock Exchange News Service of the JSE ( SENS ) to SENS subscribers. each Applicable Pricing Supplement; v) any other supplement to this Programme Memorandum circulated by the Issuer from time to time; and vi) the Memorandum of Incorporation of the Issuer. This Programme Memorandum and the applicable documents referred to above are available for inspection, during normal office hours, at the registered office of the Issuer and are available on the Issuer s website, www.ecsponent.com. This Programme Memorandum is and, when they become available, the documents listed in paragraphs (iv) to (v) above will also be available for inspection on the JSE s website, www.jse.co.za. Any statement contained in this Programme Memorandum or in any document which is incorporated by reference into this Programme Memorandum will be deemed to be modified or superseded for the purposes of this Programme Memorandum to the extent that a statement contained in any such subsequent document which is deemed to be incorporated by reference in this Programme Memorandum modifies or supersedes such earlier statement (whether expressly, by implication or otherwise). The Issuer will publish a new Programme Memorandum or a further supplement to this Programme Memorandum, as the case may be, on the occasion of any subsequent issue of Preference Shares only where there has been: (a) (b) a material change in the condition (financial or otherwise) in respect of the Issuer which is not then reflected in this Programme Memorandum or any supplement to this Programme Memorandum; or any modification of the terms of the Programme which would make this Programme Memorandum inaccurate or misleading. Any such new Programme Memorandum or supplemented Programme Memorandum, as the case may be, will be deemed to have substituted the previous Programme Memorandum from the date of issue of the new Programme Memorandum or supplemented Programme Memorandum, as the case may be. 8

GENERAL DESCRIPTION OF THE PROGRAMME Words used in this section headed General Description of the Programme shall bear the same meanings as used in the section headed Definitions and Interpretations and as defined elsewhere in this Programme Memorandum, except to the extent that they are separately defined in this section or the context otherwise requires. The Issuer may from time to time issue multiple Tranches, Series and classes of Preference Shares under the Programme, pursuant to this Programme Memorandum, provided that the aggregate nominal amount of all of the Preference Shares issued under the Programme from time to time does not exceed the Programme Amount. A Series of Preference Shares may be listed on the Main Board of the JSE or on such other, or additional financial exchange(s) as may be determined by the Issuer, subject to Applicable Laws. Unlisted Preference Shares may also be issued under the Programme, but will not be regulated by the JSE. The Applicable Pricing Supplement will specify whether or not a Series of Preference Shares will be listed and, if so, on which financial exchange. If the Issuer issues a Series of unlisted Preference Shares or a Series of Preference Shares is listed on any financial exchange other than (or in addition to) the JSE, the Issuer will, by no later than the last Day of the month of issue of that Series of Preference Shares, inform the JSE in writing of the aggregate nominal amount and the Redemption Date (if any) of that Series of Preference Shares. This Programme Memorandum and any supplement will only be valid for the issue of Preference Shares in an aggregate nominal amount which, when added to the aggregate nominal amount then outstanding of all the Preference Shares previously or simultaneously issued under the Programme, does not exceed ZAR5,000,000,000. From time to time the Issuer may wish to increase the Programme Amount. Subject to the Applicable Procedures and all Applicable Laws, the Issuer may, without the consent of Preference Shareholders or any other shareholder, increase the Programme Amount by delivering a notice thereof to the Preference Shareholders in accordance with Condition 19 (Notices) of the Terms and Conditions, and to the Debt Sponsor, the JSE and Strate. Upon such notice being given to the Preference Shareholders and the conditions set out in this Programme Memorandum for the Issuer to exercise this right having been met, all references in this Programme Memorandum (and each agreement, deed or document relating to the Programme and/ or this Programme Memorandum) to the Programme Amount will be, and will be deemed to be, references to the increased Programme Amount set out in such notice. Neither the Programme nor the Preference Shares are rated. Any future rating of a Series of Preference Shares is not a recommendation to subscribe for, buy, sell or hold any Preference Shares, and may be subject to revision, suspension or withdrawal at any time by the rating agency. A summary of the Programme and the Terms and Conditions appears below. 9

SUMMARY OF THE PROGRAMME The following summary does not purport to be complete and is taken from, and is qualified in its entirety by, the remainder of this Programme Memorandum and, in relation to the Terms and Conditions of any particular Tranche of Preference Shares, the Applicable Pricing Supplement. Capitalised terms used in this summary shall have the same meaning as set out in the section headed Definitions and Interpretations. PARTIES Issuer Calculation Agent JSE Debt Sponsor CSD JSE Ecsponent Limited (registration number 1998/013215/06) (formerly John Daniel Holdings Limited), a public company duly registered and incorporated on 9 July 1998, under the laws of South Africa and listed on the VCM on the JSE, having its registered address at Acacia House, Green Hill Village Office Park, Cnr of Nentabos and Botterklapper Street, The Willows, Pretoria East. Ecsponent Questco Proprietary Limited (Registration number 2002/005616/07), a private company duly incorporated in accordance with the laws of RSA. Strate Proprietary Limited (registration number 1998/022242/06), a public company with limited liability incorporated in accordance with the company laws of South Africa and registered as a Central Securities Depository in terms of the Financial Markets Act or such additional, alternative or successor Central Securities Depository as may be agreed between the Issuer and the relevant Dealer(s). the JSE Limited (registration number 2005/022939/06), a licensed exchange in terms of the Financial Markets Act or any exchange which operates as a successor exchange to the JSE. GENERAL Authority The Issuer has obtained specific approval from its shareholders to issue Class A Preference Shares, Class B Preference Shares and Class C Preference Shares to public investors who are not related parties, limited to the Programme Amount, for an indefinite period. The Issuer is currently restricted from issuing Class G Preference Shares in excess of its general authority, as obtained at its last annual general meeting and subject to the JSE Listings Requirements, whereby it may issue securities convertible into Shares (see Condition 6 Convertibility in the event of failure to rectify a default event ), up to a limit of 15% of the Shares in issue at the time of the annual general meeting, being 135 410 204 Shares or securities convertible into Shares. The Issuer may in the near future seek a specific approval from Shareholders whereby the Class G Preference Shares, as potentially convertible securities, may be issued up to the Programme Amount, as amended form time to time. Should this specific approval not be obtained, the Issuer will be restricted from issuing Class G Preference Shares in excess of its general authority, which is below the Programme Amount. Blocked Rand Blocked Rand may be used to subscribe for, or purchase, Preference Shares, subject to the Exchange Control Regulations. 10

GENERAL Clearing and Settlement Denomination Description of Programme Distribution Dividends Each Tranche of Preference Shares which is held in Strate will be issued, cleared and settled in accordance with the Applicable Procedures through the electronic settlement system of Strate. Strate acts as the approved electronic clearing house, and carries on the role of matching, clearing and facilitation of settlement of all transactions carried out on the JSE. Each Tranche of Preference Shares which is held in Strate will be cleared by Participants who will follow the electronic settlement procedures prescribed by the JSE and Strate as set out in the section of this Programme Memorandum headed Settlement, Clearing and Transfers. Preference Shares will be issued in such denominations as may be agreed by the Issuer and as indicated in the Applicable Pricing Supplement, save that the minimum denomination of each Preference Share will be such as may be allowed or required from time to time by the central bank or regulator or any laws or regulations applicable to the Preference Shares. Ecsponent Limited ZAR5,000,000,000 Preference Share Programme, dated 15 December 2015. Preference Shares may be distributed by way of offer to the public, private placement or any other means permitted under South African law as may be determined by the Issuer and as reflected in the Applicable Pricing Supplement. Preference Shares may or may not be entitled to cumulative dividends. Dividends (if any) may be calculated with reference to various interest rates, including a fixed rate or a variable rate. The method of calculating dividends will be specified in the Applicable Pricing Supplement. Dividend Period(s)/ Dividend Payment Date(s) Form of Preference Shares Governing Law Guarantee Issue and Transfer Taxes The Dividend Rate, Dividend Payment Date(s) and Dividend Period(s), if any will be specified in the Applicable Pricing Supplement. Preference Shares will be issued in dematerialised form, and will be held electronically in Strate. The holder of a Beneficial Interest may exchange such Beneficial Interest for a Preference Shares in certificated form represented by an Individual Certificate (see condition 2 Form and Denominations ). The Preference Shares will be governed by and construed in accordance with the laws of South Africa in force from time to time. The Preference Shares are not guaranteed or secured. As at the Programme Date, no securities transfer tax or any similar tax is payable in respect of the issue of Preference Shares, or in respect of the conversion of Preference Shares into Ordinary Shares in terms of Condition 6 (Conversion of Preference Shares). Subsequent transfer or redemption of the Preference Shares may trigger securities transfer tax (see section headed South African Taxation ). Any future transfer duties and/or taxes that may be introduced in respect of (or may be applicable to) the transfer of Preference Shares will be for the account of Preference Shareholders. Issue Price Preference Shares may be issued on a fully paid basis and at their nominal amount or at a discount or premium to their nominal amount as specified in the Applicable Pricing Supplement. 11

GENERAL Listing The initial registration of the Programme has been approved by the JSE on 8 September 2014, and the first update to the Programme has been approved on 15 December 2015. Preference Shares issued under the Programme may be listed on the Main Board of the JSE or on such other or additional financial exchange(s) as may be determined by the Issuer, subject to all Applicable Laws. Unlisted Preference Shares may also be issued under the Programme. Unlisted Preference Shares are not regulated by the JSE. The Applicable Pricing Supplement will specify whether or not a Tranche of Preference Shares will be listed and, if so, on which financial exchange(s). Maturities of Preference Shares Preference Shares Such maturity(ies) as specified in the Applicable Pricing Supplement. The Preference Shares are not subject to any minimum or maximum maturity. Preference Shares may comprise: Class A Fixed Rate Redeemable Preference Shares: Class A Preference Shares will be entitled to dividends calculated with reference to a fixed rate of 10% per annum, payable monthly in arrears on such date or dates as may be determined by the Issuer, as indicated in the Applicable Pricing Supplement, and on redemption will be calculated on the basis of such Day Count Fraction as may be determined by the Issuer. Class A Preference Shares will be redeemed (automatically) on the five year anniversary of the Initial Issue Date at an amount equal to 100% of the Initial Issue Price of a Class A Preference Share. Class B Zero Rate Redeemable Preference Shares: Class B Preference Shares are not entitled to dividends. Class B Preference Shares will be redeemed (automatically) on the five year anniversary of the Initial Issue Date at an amount equal to 170% of the Initial Issue Price of a Class B Preference Share, providing Preference Shareholders with an effective yield of 10.66% nominal, annual, compound monthly. Class C Variable Rate Redeemable Preference Shares: Class C Preference Shares will be entitled to dividends calculated with reference to a variable rate equal to the Prime Rate plus 4% per annum, payable monthly in arrears on such date or dates as may be determined by the Issuer, as indicated in the Applicable Pricing Supplement, and on redemption will be calculated on the basis of such Day Count Fraction as may be determined by the Issuer. Class C Preference Shares will be redeemed (automatically) on the five year anniversary of the Initial Issue Date at an amount equal to 100% of the Initial Issue Price of a Class C Preference Share. Class G Fixed Rate Redeemable Preference Shares: Class G Preference Shares will be entitled to dividends calculated with reference to a fixed rate of 11.2% per annum, payable monthly in arrears on such date or dates as may be determined by the Issuer, as indicated in the Applicable Pricing Supplement, and on redemption will be calculated on the basis of such Day Count Fraction as may be determined by the Issuer. Class G Preference Shares will be redeemed (automatically) on the five year anniversary of the Initial Issue Date at an amount equal to 100% of the Initial Issue Price of a Class G Preference Share. 12

GENERAL Preference Shareholders The holders of listed or unlisted issued Preference Shares (as recorded in the Register). Uncertificated form Participants or their nominees will be named in the Register as the Preference Shareholder of each Tranche of Preference Shares which is held in Strate, unless investors elect own-name registration. Certificated form Each holder of Preference Shares which is represented by an Individual Certificate will be named in the Register as the registered Preference Shareholder of such Preference Shares. Rating of Issuer and Preference Shares Redemption Selling Restrictions As at the Programme Date, neither the Issuer, nor the Programme, nor the Preference Shares are rated. After the Programme Date, the Programme may be rated by a rating agency on a national or international scale basis. A Tranche or a Series of Preference Shares may also, on or before the Issue Date, be rated by a rating Agency on a national or international scale basis. If applicable, the rating assigned to the Issuer and/or the Programme and/or the Preference Shares, as the case may be, as well as the rating agency(ies) which assigned such rating(s), will be specified in the Applicable Pricing Supplement. A Tranche of Preference Shares will, subject to the Applicable Pricing Supplement, be redeemed on the Redemption Date, as set out in Condition 5 (Redemption of Preference Shares). The distribution of this Programme Memorandum and/or any Applicable Pricing Supplement and any offering, or sale of, or subscription for a Tranche of Preference Shares may be restricted by law in certain jurisdictions. This Programme Memorandum is restricted by law in the United States of America, the United Kingdom, the European Economic Area and other jurisdictions (see section headed Subscription and Sale ). Any other or additional restrictions which are applicable to the placing of a Tranche of Preference Shares will be set out in the Applicable Pricing Supplement. Persons who come into possession of this Programme Memorandum and/or any Applicable Pricing Supplement must inform themselves about and observe all applicable selling restrictions. Size of the Programme Specified Currency As at the Programme Date, the Programme Amount is ZAR5,000,000,000. This Programme Memorandum will only apply to Preference Shares issued under the Programme in an aggregate nominal amount which does not exceed the Programme Amount. The Issuer may increase the Programme Amount in the manner set out in the section of this Programme Memorandum headed General Description of the Programme. The Programme Amount at the time of the issue of any Tranche of Preference Shares will be set out in the Applicable Pricing Supplement. All Preference Shares will be issued in South African Rand. 13

GENERAL Stabilisation In connection with the issue and distribution of any Tranche of Preference Shares under the Programme, the Dealer(s), if any, that are specified in the Applicable Pricing Supplement as the stabilising manager (or any person acting for the stabilising manager) may, if specified in that Applicable Pricing Supplement and only if such stabilising is permitted by the JSE Debt Listings Requirements and approved by the JSE, over-allot or effect transactions with a view to supporting the market price of the Preference Shares at a level higher than that which might otherwise prevail for a limited period. However, there will be no obligation on the stabilising manager (or any agent of the stabilising manager) to do this. Such stabilising, if commenced, may be discontinued at any time and must be brought to an end after a limited period. Such stabilising shall be in compliance with all Applicable Laws. Status and Characteristics The Preference Shares constitute direct, unconditional, unsecured and subordinated obligations of the Issuer. Subject to Applicable Law, in the event of the dissolution of the Issuer or if the Issuer is placed into liquidation or wound up or is subject to business rescue proceedings, then and in any such event the claims of the persons entitled to be paid amounts due in respect of the Preference Shares shall be subordinated to all other claims in respect of any other indebtedness of the Issuer except for Ordinary Shares of the Issuer, to the extent that, in any such event, and provided as aforesaid, no amount shall be eligible for setting-off or shall be payable to any or all of the persons entitled to be paid amounts due in respect of the Preference Shares in respect of the obligations of the Issuer thereunder until all other indebtedness of the Issuer which is admissible in any such dissolution, liquidation, winding-up or business rescue proceedings has been paid or discharged in full. Class A Preference Shares, Class B Preference Shares and Class C Preference Shares will rank pari passu among themselves and will rank at least pari passu with all other present and future unsecured preference shares issued by the Issuer. Class A Preference Shares, Class B Preference Shares and Class C Preference Shares will rank in priority to Class G Preference Shares and ordinary shares of the Issuer. Class G preference shares will rank in priority to ordinary shares of the Issuer. Taxation A summary of the applicable tax legislation in respect of the Preference Shares, as at the Programme Date, is set out in the section of this Programme Memorandum headed South African Taxation. The summary does not constitute tax advice. Potential investors in the Preference Shares should, before making an investment in the Preference Shares, consult their own professional advisers as to the potential tax consequences of, and their tax positions in respect of, an investment in the Preference Shares. 14

GENERAL Terms and Conditions Use of Proceeds Withholding Taxes The terms and conditions of the Preference Shares are set out in the section of this Programme Memorandum headed Terms and Conditions of the Preference Shares. The Applicable Pricing Supplements may specify other terms and conditions (which may replace, modify or supplement the Terms and Conditions) in relation to specific terms and conditions of the Preference Shares of any Tranche of Preference Shares issued. Any amendments to Preference Shares must be approved in the manner set out in Condition 19 (Variation in the rights and amendment of conditions). The Issuer will use the issue proceeds of the Preference Shares for its general corporate purposes and for reasons further detailed in the section headed Use of Proceeds, or as may otherwise be described in the Applicable Pricing Supplement. All payments (whether in respect of capital, dividends or otherwise) in respect of the Preference Shares will be made free and clear of and without withholding or deduction for or on account of any present or future taxes, duties, assessments or governmental charges of whatever nature imposed, levied, collected, withheld or assessed by, or on behalf of, South Africa or any political subdivision of, or any authority or agency in or of, South Africa having power to tax, unless (where applicable) the withholding or deduction of such taxes, duties, assessments or governmental charges is required by law. In that event, the Issuer shall make such payments after such withholding or deduction has been made (where applicable) and shall account to the relevant authorities for the amount so required to be withheld or deducted. The Issuer shall not be obliged to make any additional payments to Preference Shareholders in respect of such withholding or deduction 15

TERMS AND CONDITIONS OF THE PREFERENCE SHARES Words used in this section headed Terms and Conditions of the Preference Shares shall bear the same meanings as used in the section headed Definitions and Interpretations and as defined elsewhere in this Programme Memorandum, except to the extent that they are separately defined in this section or the context otherwise requires. Any reference in these Conditions to Strate shall, wherever the context permits, be deemed to include a reference to its successor in terms of the Financial Markets Act (or any successor Act thereto), and any additional or alternate depository approved by the Issuer and the JSE. Any reference in these Terms and Conditions to the JSE shall, wherever the context permits, be deemed to include any exchange which operates as a successor exchange to the JSE. 1. Issue 1.1 The Issuer may, from time to time (without the consent of any Preference Shareholder), issue multiple Tranches of Preference Shares pursuant to the Programme, provided that the aggregate outstanding nominal amount of all of the Preference Shares issued under the Programme from time to time does not exceed the Programme Amount. No minimum amount is applicable to the issue of the Preference Shares. 1.2 The Issuer has obtained specific approval from shareholders to issue Class A Preference Shares, Class B Preference Shares and Class C Preference Shares up to the Programme Amount for an indefinite period. 1.3 It should be noted that the Issuer is currently restricted from issuing Class G Preference Shares in excess of its general authority, as obtained at its last annual general meeting and subject to the JSE Listings Requirements, whereby it may issue securities convertible into Shares (see Condition 6 Convertibility in the event of failure to rectify a default event ), up to a limit of 15% of the Shares in issue at the time of the annual general meeting, being 135 410 204 Shares or securities convertible into Shares. 1.4 No preference shares will be issued to related parties. 1.5 The Issuer may in the near future seek a specific approval from Shareholders whereby the Class G Preference Shares, as potentially convertible securities, may be issued up to the Programme Amount, as amended form time to time. 1.6 Should this specific approval not be obtained, the Issuer will be restricted from issuing Class G Preference Shares in excess of its general authority, which is below the Programme Amount. 1.7 Subject to the approvals above, the total preference shares issued, listed and unlisted, is limited only by the authorised share capital of the Issuer. 1.8 Preference Shares will be issued in individual Tranches which, together with other Tranches, may form a Series of Preference Shares. A Tranche of Preference Shares will be issued on, and subject to, the applicable Terms and Conditions of a Tranche of Preference Shares which are the Terms and Conditions, as replaced, amended and/or supplemented by the terms and conditions of that Tranche of Preference Shares set out in the Applicable Pricing Supplement relating to that Tranche of Preference Shares. 1.9 The applicable Terms and Conditions of a Tranche of Preference Shares are incorporated by reference into the Individual Certificate(s) (if any) representing the Preference Shares in that Tranche. The Applicable Pricing Supplement relating to a Tranche of Preference Shares issued in certificated form will be attached to the Individual Certificate(s) representing the Preference Shares in that Tranche. 16

2. Form and Denominations 2.1 General 2.1.1 A Tranche of Preference Shares may be issued in the form of listed or unlisted Preference Shares, as specified in the Applicable Pricing Supplement. 2.1.2 Each Preference Share may be a variable rate Preference Share, a fixed rate Preference Share or a zero rate Preference Share, and/or such combination of any of the foregoing or such other type of Preference Share as permitted from time to time in terms of the MOI and as may be determined by the Issuer and specified in an Applicable Pricing Supplement. 2.2 Denominations 2.2.1 Preference Shares will be issued subject to a minimum subscription amount of ZAR10 000 per applicant, or otherwise for such minimum subscription amounts as may be determined by the Issuer and as specified in the Applicable Pricing Supplement. 2.3 Main Board 2.3.1 A Tranche of Preference Shares may be listed on the Main Board of the JSE but subject to the Debt Listings Requirements or on such other or further exchange(s) as may be determined by the Issuer, subject to any Applicable Laws and Applicable Procedures. 2.4 Form of Preference Shares 2.4.1 Each Tranche of Preference Shares which is listed will be issued in dematerialised form (uncertificated), and will be held in Strate, in terms of section 33 of the Financial Markets Act. Preference Shares issued in dematerialised form will not be represented by any certificate or written instrument. Investors who subscribe for Preference Shares in dematerialised form will become the holders of Beneficial Interests. 2.4.2 Beneficial Interests in Preference Shares held in Strate 2.4.2.1 Strate will hold Preference Shares subject to the Financial Markets Act and the Applicable Procedures. 2.4.2.2 All amounts to be paid and all rights to be exercised in respect of dematerialised Preference Shares held in Strate will be paid to and may be exercised only by the Participants or their nominees, on half of the holders of Beneficial Interests. 2.4.2.3 A holder of a Beneficial Interest may exchange such Beneficial Interest for a certificated Preference Share, represented by an Individual Certificate, in accordance with Condition 15 (Exchange of Beneficial Interests and Replacement of Individual Certificates). 2.4.3 Preference Shares not listed may be issued in certificated or dematerialised form. 17

3. Title 3.1 Preference Shares issued in certificated form 3.1.1 Each holder of Preference Shares represented by an Individual Certificate will be named in the Register as the registered holder of such Preference Shares. 3.1.2 Title to Preference Shares represented by an Individual Certificate will pass upon registration of transfer in the Register in accordance with Condition 19 (Transfer of Preference Shares). 3.1.3 The Issuer, the Transfer Secretaries and the Paying Agent shall recognise a Preference Shareholder as the sole and absolute owner of the Preference Shares registered in that Preference Shareholder s name in the Register (notwithstanding any notice of ownership or writing thereon or notice of any previous loss or theft thereof) and shall not be bound to enter any trust in the Register or to take notice of or to accede to the execution of any trust, express, implied or constructive, to which any Preference Share may be subject. 3.2 Preference Shares issued in dematerialised form 3.2.1 Participants, or their nominees, will be named in the Register as the registered holder of a Preference Share which is issued in dematerialised form, unless investors have elected own-name registration. 3.2.2 Strate maintains central securities accounts only for Participants. Beneficial Interests which are held by Participants, on behalf of their clients, will be held directly through Strate, and Strate will hold such Beneficial Interests, on behalf of such Participants, through the central securities accounts maintained by Strate for such Participants. 3.2.3 The Participants are in turn required to maintain securities accounts for their clients. Beneficial Interests which are held by clients of Participants will be held indirectly through such Participants, and such Participants will hold such Beneficial Interests, on behalf of such clients, through the securities accounts maintained by such Participants for such clients. The clients of Participants may include the holders of Beneficial Interests or their custodians. The clients of Participants, as the holders of Beneficial Interests or as custodians for such holders, may exercise their rights in respect of the Preference Shares held by them in Strate only through their Participants. 3.2.4 In relation to each person shown in the records of Strate or the relevant Participant, as the case may be, as the holder of a Beneficial Interest, a certificate or other document issued by Strate or the relevant Participant, as the case may be, as to the aggregate nominal amount of such Preference Shares standing to the account of such person shall be prima facie proof of such Beneficial Interest. Participants, or their nominees, will be treated by the Issuer, the Paying Agent, and the Transfer Secretaries as the holder of that aggregate nominal amount of such Preference Shares for all purposes. 3.2.5 Beneficial Interests may be transferred only in accordance with the Applicable Procedures. 3.2.6 Any reference in the Terms and Conditions to the relevant Participant shall, in respect of a Beneficial Interest, be a reference to the Participant appointed to act as such by the holder of such Beneficial Interest. 18

4. Status of Preference Shares 4.1 Subject to Applicable Law, in the event of the Issuer commencing business rescue proceedings (whether voluntarily or otherwise) or in the event of the dissolution of the Issuer or if the Issuer is placed into liquidation or wound-up the claims of the persons entitled to payment of amounts due in respect of the Preference Shares, shall be subordinated to all other claims in respect of any other indebtedness of the Issuer to the extent that, in any such event, and provided as aforesaid, no amount shall be eligible for setting-off or shall be payable to any or all of the persons entitled to payment of amounts due in respect of the Preference Shares in respect of the obligations of the Issuer thereunder until all other indebtedness of the Issuer which is admissible in any such business rescue, dissolution, insolvency or winding-up (other than Subordinated Indebtedness) has been paid or discharged in full. 4.2 Class A Preference Shares, Class B Preference Shares and Class C Preference Shares rank pari passu, but in priority to Class G Preference Shares and Ordinary Shares with regards to capital and dividend payments. 4.3 Class G Preference Shares rank in priority to Ordinary Shares with regards to capital and dividend payments. 4.4 Ecsponent currently has no other senior debt and has no other debt securities listed. 4.5 No covenants apply to Ecsponent in terms of issuing these Preference Shares. 5. Redemption of Preference Shares 5.1 All classes of Preference Shares are automatically redeemable by the Issuer on the fifth anniversary of the Initial Issue Date, at a price equal to: 5.1.1 100% of the Initial Issue Price for Class A Preference Shares 5.1.2 170% of the Initial Issue Price for Class B Preference Shares 5.1.3 100% of the Initial Issue Price for Class C Preference Shares 5.1.4 100% of the Initial Issue Price for Class G Preference Shares 5.2 Should the Redemption Amount remain outstanding for a period of three months, the conversion provisions of Preference Shares in Condition 6 ( Convertibility in the event of failure to rectify a default event ) below will come into effect. 5.3 The redemption of Preference Shares shall take place in accordance with the Applicable Procedures and the Financial Markets Act. 5.4 Redemption Amounts will be payable on the Redemption Payment Date to all Preference Shareholders named in the Register on the Redemption Record Date. The last day on which Preference Shares can be traded before redemption will be Redemption Last Day to Trade. Preference Shares due for redemption will be suspended from trading on the JSE from Redemption Suspension Date and will be finally delisted on Listing Termination Date, and thereafter cancelled. 5.5 Finalisation information regarding Redemption amounts will be published on SENS on the Redemption Finalisation Date. 19

6. Convertibility in the event of failure to rectify a default event 6.1 If the Issuer fails to rectify a default event in respect of a class of Preference Shares within 3 (three) months of the event of default, a default event being: 6.1.1 non-payment of the Redemption Amount on the Redemption Payment Date; or 6.1.2 non-payment of 3 (three) consecutive Dividend Amounts on Class A Preference Shares, Class C Preference Shares or Class G Preference Shares, the Preference Shares of that class shall become convertible into ordinary Shares 6.2 Save in the event of non-rectification of a default event as set out above, the Preference Shares are not convertible. 6.3 Upon date of conversion all outstanding Preference Shares, stated capital, premium and any Dividend Amounts still outstanding to the Preference Shareholders shall convert into ordinary Shares. 6.4 The conversion rate into ordinary Shares shall be calculated at the fair and reasonable price of the ordinary Shares as determined by the weighted average closing price of the Company, calculated over the last twenty days of trading on the JSE prior to the first day of default. 6.5 In the event that the calculation set out in this clause 5 gives rise to a fraction of an ordinary Share becoming due to a shareholder, the number of ordinary Shares arising shall be rounded up or down to the nearest whole number in compliance with the JSE s rounding convention. 7. Cancellation All Preference Shares which are redeemed in full will forthwith be cancelled. All Preference Shares so cancelled and the Preference Shares purchased and cancelled pursuant to Condition 9 (Purchases), shall be held by the Issuer and cannot be re-issued or resold. The Issuer shall notify Strate and the JSE of any cancellation of the Preference Shares so that such entities can record the reduction in the aggregate nominal amount of the Preference Shares in issue. 8. Notice of payments The Issuer shall, publish notification on SENS for as long as the Preference Shares are listed and if not listed, notify Preference Shareholders, Strate and the JSE, and Preference Shareholders registered as such on each Dividend Record Date / Redemption Record Date of the Dividend Amount / Redemption Amount payable on the following Dividend Payment Date / Redemption Payment Date. 9. Purchases The Issuer may, from time to time, repurchase Preference Shares, subject to the JSE Listings Requirements and the Act. Such Preference Shares shall be cancelled and will thereafter not have any voting or other rights. 20

10. Entitlement to Dividends 10.1 Dividends on Class A Preference Shares 10.1.1 Dividend Rate Class A Preference Shares are entitled to cumulative dividends calculated equal to a fixed rate of 10% per annum (not compounded) on the Initial Issue Price of the Preference Share, calculated from (and including) the Dividend Commencement Date specified in the Applicable Pricing Supplement. 10.1.2 Dividend Payment Date The dividends due in respect of each Dividend Period will be payable in arrears on the Dividend Payment Date. The first payment of dividends will be made on the Dividend Payment Date immediately following the Dividend Commencement Date. 10.1.3 Calculation of Dividend Amount The Calculation Agent will calculate the Dividend Amount payable in respect of each Tranche of Class A Preference Shares for each Dividend Period. Unless stated otherwise in the Applicable Pricing Supplement, the monthly Dividend Amount shall be calculated by multiplying the Dividend Rate by the Initial Issue Price of the Class A Preference Share, and then multiplying such product by the actual number of days (including the first day and excluding the last day) in such period divided by 365. 10.1.4 Dividends on Class B Preference Shares Class B Preference Shares are not entitled to a dividend however redeem at a price equal to 170% of the Initial Issue Price of the Class B Preference Share, providing the Class B Preference Shareholders with an effective yield of 10.66% per annum, if issued at 100% of the Initial Issue Price. 10.2 Dividends on Class C Preference Shares 10.2.1 Dividend Rate Class C Preference Shares are entitled to cumulative dividends calculated at a variable rate equal to the Prime Rate plus 4% per annum (not compounded) on the Initial Issue Price of a Preference Share, calculated from (and including) the Dividend Commencement Date specified in the Applicable Pricing Supplement. 10.2.2 Dividend Payment Dates The dividends due in respect of each Dividend Period will be payable in arrears on each Dividend Payment Date. The first payment of dividends will be made on the Dividend Payment Date immediately following the Dividend Commencement Date. 10.2.3 Determination of Dividend Rate and calculation of Dividend Amount The Calculation Agent will, on each Rate Determination Date, determine the Dividend Rate applicable to a Tranche of Class C Preference Share for the Dividend Period commencing on that Rate Determination Date and calculate the Dividend Amount payable in respect of each Class C Preference Share in that Tranche for that Dividend Period. Unless stated otherwise in the Applicable Pricing Supplement, the Dividend Amount will be determined by multiplying the Dividend Rate by the Initial Issue Price of such Class C Preference Share and then multiplying such product by the actual number of days elapsed in such Dividend Period, divided by 365. The resultant sum will be rounded to the nearest cent, half a cent being rounded upwards. 21

10.3 Dividends on Class G Preference Shares 10.3.1 Dividend Rate Class G Preference Shares are entitled to cumulative dividends calculated equal to a fixed rate of 11.2% per annum (not compounded) on the Initial Issue Price of the Preference Share, calculated from (and including) the Dividend Commencement Date specified in the Applicable Pricing Supplement. 10.3.2 Dividend Payment Date The dividends due in respect of each Dividend Period will be payable in arrears on the Dividend Payment Date. The first payment of dividends will be made on the Dividend Payment Date immediately following the Dividend Commencement Date. 10.3.3 Calculation of Dividend Amount The Calculation Agent will calculate the Dividend Amount payable in respect of each Tranche of Class G Preference Shares for each Dividend Period. Unless stated otherwise in the Applicable Pricing Supplement, the monthly Dividend Amount shall be calculated by multiplying the Dividend Rate by the Initial Issue Price of the Class G Preference Share, and then multiplying such product by the actual number of days (including the first day and excluding the last day) in such period divided by 365. 10.3.4 Publication of Dividend Rate and Dividend Amount by the Calculation Agent The Company shall notify Preference Shareholders of the Dividend Rate and Dividend Amount in the manner set out in Condition 187 (Notices). 10.4 General Only Preference Shareholders who are named in the Register on the Dividend Record Date will be entitled to receive Dividend Amounts. Preference Shares will start trading ex-dividend from the Dividend Ex-Date. Preference Shares traded on or before the Dividend Last Day to Trade will be traded cum-dividend Finalisation information regarding Dividend Amounts will be published on the Dividend Finalisation Date. 11. Unclaimed dividends and prescription All unclaimed dividends may be invested by the Company in trust for the benefit of the Company until claimed, and dividends that remain unclaimed for a period of 3 (three) years from the date on which they were declared may be declared by the Directors to be forfeited for the benefit of the Company. 12. Payments 12.1 The Redemption Amount and Dividend Amount shall be paid by the Issuer in Rand. The Issuer shall not be obliged to make payment of, and Preference Shareholders shall not be entitled to receive payment of, any amount due and payable under the Preference Shares by the Issuer, except in accordance with the their ranking on priority of payment. 12.2 Payments will be subject in all cases to any fiscal or other laws and regulations applicable thereto in South Africa. Payments will be made in line with Schedule 18 of the Listings Requirements. 22

12.3 Payments to Preference Shareholders in dematerialised form 12.3.1 Payments of Dividend Amounts and Redemption Amounts in respect of Preference Shares held in dematerialised form in Strate will be made to a Participant, or its nominee, as the holder of such Preference Shares (unless investors have chosen own-name registration), which in turn will transfer such funds to the holders of Beneficial Interests. 12.3.2 Each of the persons reflected in the records of Strate or the relevant Participants, as the case may be, as the holders of Beneficial Interests shall look solely to Strate or the relevant Participant, as the case may be, for such person s share of each payment so made by the Issuer to, or for the order of, the registered holder of the Preference Share held in dematerialised form. 12.3.3 The Issuer will not have any responsibility or liability for any aspect of the records relating to, or payments made on account of, Beneficial Interests, or for maintaining, supervising or reviewing any records relating to such Beneficial Interests. Payments of Dividend Amounts and Redemption Amounts in respect of Preference Shares held in Strate in dematerialised form shall be recorded by Participants, distinguishing between dividends and principal, and such record of payments by the registered holder of the Preference Shares shall be prima facie proof of such payments. 12.4 Payments to Preference Shareholders in certificated form 12.5 Payments of Dividends Amounts and Redemption Amounts in respect of Preference Shares represented by Individual Certificates shall be made by the Transfer Secretaries on behalf of the Issuer to the person reflected as the registered holder of the Individual Certificate in the Register on the Record Date. 12.6 Method of payment 12.2.6 All monies payable on or in respect of each Preference Share shall be paid by electronic funds transfer to the account of the relevant Preference Shareholder as set forth in the Register at 17h00 (Johannesburg time) on the Dividend Record Date and/or Redemption Record Date, as the case may be, preceding the relevant Dividend Payment Date or Redemption Date, as the case may be, or, in the case of joint Preference Shareholders, the account of that one of them who is first named in the Register in respect of that Preference Share, provided that no payment in respect of the redemption of such Preference Share shall be made by the Issuer until 6 (six) days after the date on which the Individual Certificate in respect of the Preference Share to be redeemed has been surrendered to the Transfer Secretaries for endorsement or cancellation in terms of Condition 4.4. 12.6.2 If several persons are entered into the Register as joint Preference Shareholders then payment to any one of them of any monies payable on or in respect of the Preference Share shall be an effective and complete discharge by the Issuer of the amount so paid, notwithstanding any notice (express or otherwise) which the Issuer may have of the right, title, interest or claim of any other person to or in any Preference Share or interest therein. 12.7 Payment Day 12.8 If the date for payment of any amount in respect of any Preference Share is not a Business Day, the holder thereof shall not be entitled to payment until the next following Business Day and shall not be entitled to further interest or other payment in respect of such delay. 23

13. Taxation 13.1 All payments (whether in respect of capital, dividends or otherwise) in respect of the Preference Shares will be made free and clear of and without withholding or deduction for or on account of any present or future taxes, duties, assessments or governmental charges of whatever nature imposed, levied, collected, withheld or assessed by, or on behalf of, South Africa or any political subdivision of, or any authority or agency in or of, South Africa having power to tax, unless (where applicable) the withholding or deduction of such taxes, duties, assessments or governmental charges is required by law. In that event, the Issuer shall make such payments after such withholding or deduction has been made (where applicable) and shall account to the relevant authorities for the amount so required to be withheld or deducted. The Issuer shall not be obliged to make any additional payments to Preference Shareholders in respect of such withholding or deduction. 13.2 Refer to the Annexure 1 of this Programme Memorandum headed South African Taxation or the taxation implications for dividend payments, and payment of Redemption Amounts. 14. Exchange of Beneficial Interests and Replacement of Individual Certificates 14.1 Exchange of Beneficial Interests 14.1.1 The holder of a Beneficial Interest in Preference Shares may, in terms of the Applicable Procedures and subject to section 42 of the Financial Markets Act, by written notice to the holder s nominated Participant request that such Beneficial Interest be exchanged for Preference Shares in definitive form represented by an Individual Certificate ( Exchange Notice ). Such Exchange Notice shall specify the name, address and bank account details of the holder of the Beneficial Interest. 14.1.2 The holder s nominated Participant will within 5 business days following receipt of the Exchange Notice notify the Company, and its Transfer Secretaries, that it is required to exchange such Beneficial Interest for Preference Shares represented by an Individual Certificate and remove the details of the Preference Shares so exchanged from the dematerialised Preference Shares. 14.1.3 The Company, or its Transfer Secretaries will, as soon as is practicable but within 10 business days (or 20 business days in the case of a holder of securities who is not resident within the Republic) after receiving such notice, in accordance with the Applicable Procedures, procure that an Individual Certificate is prepared, authenticated and made available for delivery, to the holder of the Beneficial Interest at the registered office of the Transfer Secretaries; provided that joint holders of a Beneficial Interest shall be entitled to receive only one Individual Certificate in respect of that joint holding, and delivery to one of those joint holders shall be delivery to all of them. 14.1.4 The Transfer Secretaries will obtain the release of such dematerialised Preference Shares from Strate in accordance with the Applicable Procedures. 14.1.5 An Individual Certificate shall represent the aggregate nominal amount of Preference Shares held by the holder of the Beneficial Interest, and shall otherwise be in such form as may be agreed between the Company and the Transfer Secretaries and as governed by the Applicable Procedures. 24

14.2 Replacement If any Individual Certificate is mutilated, defaced, stolen, destroyed or lost it may be replaced at the office of the Transfer Secretaries on payment by the claimant of such costs and expenses as may be incurred in connection therewith and against the furnishing of such indemnity as the Transfer Secretaries may reasonably require. Mutilated or defaced Certificates must be surrendered before replacements will be issued. 14.3 Death and sequestration or liquidation of Preference Shareholder Any person becoming entitled to Preference Shares in consequence of the death, sequestration or liquidation of the relevant Preference Shareholder may, upon producing evidence to the satisfaction of the Issuer that he/she/it holds the position in respect of which he/she/it proposes to act under this paragraph or of his/her/its title, require the Transfer Secretaries to register such person as the holder of such Preference Shares or, subject to the requirements of this Condition, to transfer such Preference Shares to such person. 14.4 Costs Certificates shall be provided (whether by way of issue, delivery or exchange) by the Issuer without charge, save as otherwise provided in these Conditions. Separate costs and expenses relating to the provision of Certificates or the transfer of Preference Shares may be levied by other persons, such as the Participant, under the Applicable Procedures and such costs and expenses shall not be borne by the Issuer. The costs and expenses of delivery of Certificates by a method other than ordinary post (if any) and, if the Issuer shall so require, taxes or governmental charges or insurance charges that may be imposed in relation to such mode of delivery shall be borne by the Preference Shareholder. 15. Transfer of Preference Shares 15.1. Transfer of dematerialised Preference Shares 15.1.1 Beneficial Interests in the Preference Shares may be transferred in terms of the Applicable Procedures through Strate. 15.1.2 Strate maintains accounts only for its Participants. Beneficial Interests which are held by Participants may be held directly through Strate. Participants are in turn required to maintain securities accounts for their clients. Beneficial Interests which are not held by Participants may be held by clients of Participants indirectly through such Participants. 15.1.3 Transfers of Beneficial Interests to and from clients of Participants occur, in terms of existing law and practice, by way of electronic book entry in the securities accounts maintained by the Participants for their clients. Transfers of Beneficial Interests among Participants occur through electronic book entry in the securities accounts maintained by Strate for the Participants.. Beneficial Interests may be transferred only in accordance with these Conditions, and the Applicable Procedures. 15.2 Transfer of certificated Preference Shares 15.2.1 In order for any transfer of Preference Shares held in certificated form to be effected through the Register and for the transfer to be recognised by the Issuer, each transfer of a Preference Share: 15.2.1.1 must be pursuant to a written Transfer Form signed by the relevant Preference Shareholder and the transferee, or any authorised representative of that registered Preference Shareholder and/or transferee; and 15.2.1.2 must be made by way of the delivery of the Transfer Form to the Transfer Secretaries together with the Certificate in question for cancellation and registration of transfer of the Certificate (or the relevant part thereof). 25

15.2.2 Subject to the above, the Transfer Secretaries will, within 3 (three) Business Days of receipt by it of the request (or such longer period as may be required to comply with any applicable fiscal or other laws, regulations or the Applicable Procedures), authenticate and deliver at the Transfer Secretaries registered office to the transferee or, at the risk of the transferee, send by mail to such address as the transferee may request, a new Certificate of a like aggregate nominal amount to the Certificate (or the relevant part of the Certificate) transferred. In the case of the transfer of a part only of a Certificate, a new Certificate in respect of the balance of the certificate not transferred will be so authenticated and delivered or, at the risk of the transferor, sent to the transferor. 15.2.3 The transferor of any Preference Shares represented by a Certificate shall be deemed to remain the owner thereof until the transferee is registered in the Register as the holder thereof. 15.3 General 15.3.1 Before any transfer is registered, all relevant transfer Taxes (if any) must have been paid and such evidence must be furnished as the Transfer Secretaries reasonably requires as to the identity of the transferor and the transferee. 15.3.2 No transfer will be registered while the Register is closed as contemplated in Condition 3 (Register). The last time for a Preference Shareholder to register to qualify for payments of any Dividend Amounts (if applicable) and Redemption Amount is 16h00 (Johannesburg time) on the Dividend Record Date or the Redemption Record Date, as the case may be. 15.3.3 If a transfer of a certificated Preference Share is registered the Transfer Form and cancelled Certificate will be retained by the Transfer Secretaries. 16. Register 16.1 The Register of Preference Shares: 16.1.1 shall be kept at the registered office of the Transfer Secretaries or such other person as may be appointed for the time being by the Issuer to maintain the Register; 16.1.2 shall contain the names, addresses, e-mail addresses and bank account numbers of the registered Preference Shareholders; 16.1.3 shall show the total nominal amount of the Preference Shares held by Preference Shareholders; 16.1.4 shall show the dates upon which each of the Preference Shareholders was registered as such; and 16.1.5 shall be open for inspection at all reasonable times during business hours on Business Days by any Preference Shareholder or any person authorised in writing by a Preference Shareholder. 16.2 The Transfer Secretaries shall alter the Register in respect of any change of name, address, e-mail or account number of any of the Preference Shareholder of which it is notified. 16.3 Except as provided for in these Terms and Conditions or as required by law, in respect of Preference Shares, the Issuer will only recognise a Preference Shareholder as the owner of the Preference Shares registered in that Preference Shareholder s name as per the Register. 16.4 Except as provided for in these Terms and Conditions or as required by law, the Issuer shall not be bound to enter any trust in the Register or to take notice of or to accede to the execution of any trust (express, implied or constructive) to which any Individual Certificate may be subject. 26

17. Calculation Agent, Transfer Secretaries, Paying Agent and Participant Any third party appointed by the Issuer as Calculation Agent, Paying Agent, Transfer Secretaries or otherwise shall act solely as the agent of the Issuer and does not assume any obligation towards or relationship of agency or trust for or with any Preference Shareholders. The Issuer is entitled to vary or terminate the appointment of such agents and/or appoint additional or other agents and/or approve any change in the registered office through which any agent acts. 18. Notices 18.1 All notices (including all demands or requests under the Terms and Conditions) to the Preference Shareholders, unless indicated to the contrary herein, will be valid if: 18.1.1 transmitted electronically directly to that person in a manner and form such that the notice can conveniently be printed by the recipient within a reasonable time and at a reasonable cost; and/or 18.1.2 for as long as the Preference Shares are listed on the JSE, if published on SENS (or in the manner prescribed from time to time in terms of the Debt Listings Requirements). 18.2 Any such notice shall be deemed to have been given on the day of first publication or hand delivery or on the 7th calendar day after the day on which it is mailed, as the case may be. 18.3 Where any provision of these Conditions requires notice to be given to the Preference Shareholders of any matter other than a meeting of Preference Shareholders, such notice shall be given mutatis mutandis as set out above, subject to compliance with any other time periods prescribed in the provision concerned or in terms of the Act. 18.4 Whilst any of the Preference Shares are held in dematerialised form, notice shall be given by any holder of a Beneficial Interest to the Issuer via the holder s relevant Participant in accordance with the Applicable Procedures. 19. Variation in the rights and amendment of conditions 19.1 Any changes to the terms and conditions of the Preference Shares, other than changes which are of a formal, minor or technical nature or are made to correct a manifest error or to comply with mandatory provision of the law of South Africa, must be approved by the JSE and by Preference Shareholders holding not less than 66.67% of the value of the specific class of Preference Shares, unless variation in the rights and/or amendment of conditions require amendment of the MOI, in which case approval by special resolution of both Ordinary Shareholders and Preference Shareholders present (or represented by proxy) and voting will be required. 19.2 Notifications regarding meetings to be held will be published on SENS for as long as the Preference Shares are listed on the JSE. 27

19.3 Accordingly, upon any such amendment the Issuer will either: 19.3.1 call a meeting of all of the Preference Shareholders or a meeting of that Class of Preference Shareholders or separate meetings of each of those Classes of Preference Shareholders, as the case may be. Such meeting or meetings will be regulated by Condition 21 (Meetings of Preference Shareholders) and no proposed amendment will be made to these Conditions until such amendment has been approved by resolution referred to above at such meeting or meetings; or 19.3.2 request Preference Shareholders to vote on the proposed amendment in writing by Preference Shareholders entitled to vote on the written resolution within 15 business days after the written resolution was submitted to the relevant Preference Shareholders. The notice of the proposed written resolution will include the actual written resolution including any restrictions on the voting in terms of the Programme (if any), the last date on which the Preference Shareholder should return the signed written resolution and the address to which is should be sent. 19.4 The Issuer may effect, without the consent of any Preference Shareholder, any amendment to these Terms and Conditions which is of a formal, minor or technical nature or is made to correct a manifest error or to comply with mandatory provisions of the law of South Africa. Any such amendment will be binding on Preference Shareholders and such amendment will be notified to Preference Shareholders in accordance with Condition 5 (Notices) and to the JSE as soon as practicable thereafter. 20. Voting rights 20.1 Preference Shareholders will not be entitled to voting rights in the ordinary course of business, but will be entitled to voting rights assigned to Preference Shareholders by the Companies Act and the Issuer s MOI, and subject to the JSE Listings Requirements, which arise in the following limited circumstances: 20.1.1 During periods when any dividend (which has been declared) or any part of it remains in arrear and unpaid after six months from the Dividend Payment Date thereof; 20.1.2 Resolutions are proposed which would directly affect any rights attaching to the Preference Shares or the interests of Preference Shareholders or to the class of Preference Share to which the Preference Share in question belongs; and/or 20.1.3 A resolution is proposed in relation to the winding-up of the Company. 20.2 In terms of the provisions of the MOI and the JSE Listings requirements, voting rights obtained by Preference Shareholders as per the above, will be limited to 24.99% of the total number of all votes of all Shareholders and Preference Shareholders present in person or by proxy at such general meeting. 28

21. Meetings of Preference Shareholders 21.1 The Issuer may at any time convene a meeting of all Preference Shareholders or of all Preference Shareholders of a particular class upon at least 14 (fourteen) calendar days prior written notice (excluding any additional notice required in respect of notices which are posted) to such Preference Shareholders. This notice is required to be given in terms of Condition 18 (Notices). Such notice shall specify the date, place and time of the meeting to be held, which place shall be in South Africa, in addition to the reasons for the meeting. 21.2 Every director or duly appointed representative of the Issuer may attend and speak (in each case including but not limited to, by means of video conferencing, telephone and other electronic means) at a meeting of Preference Shareholders, but shall not be entitled to vote, other than as a proxy or representative of, or in his/her capacity as, a Preference Shareholder. 21.3 Preference Shareholders holding not less than 25% (twenty-five per cent) in nominal amount of the outstanding Preference Shares of a particular class shall be able to request the Issuer to convene a meeting of Preference Shareholders of that class. Should the Issuer fail to requisition such a meeting within 10 (ten) calendar days of such a request being received by the Issuer, the Preference Shareholders requesting such a meeting may convene such meeting. 21.4 A Preference Shareholder may by an instrument in writing (a form of proxy ) signed by the holder or, in the case of a corporation, executed under its common seal or signed on its behalf by an attorney or a duly authorised officer of the corporation, appoint any person (a proxy ) to act on his or its behalf in connection with any meeting or proposed meeting of the Preference Shareholders. 21.5 Any Preference Shareholder which is a corporation may by resolution of its directors or other governing body authorise any person to act as its representative (a representative ) in connection with any meeting or proposed meeting of the Preference Shareholders. 21.6 Any proxy or representative appointed shall, so long as the appointment remains in force, be deemed for all purposes in connection with any meeting or proposed meeting of the Preference Shareholders specified in the appointment, to be the holder of the Preference Share to which the appointment relates and the holder of the Preference Shares shall be deemed for such purposes not to be the holder. 21.7 The chairperson of the meeting shall be appointed by the Issuer. The procedures to be followed at the meeting shall be as determined by the chairperson subject to the remaining provisions of this Condition 21 (Meetings of Preference Shareholders). Should the Preference Shareholders requisition a meeting, and the Issuer fail to call such a meeting within 10 (ten) calendar days of the requisition, then the chairperson of the meeting held at the instance of the Preference Shareholders shall be selected by a majority of Preference Shareholders present in person, by representative or by proxy. 21.8 At any such meeting one or more Preference Shareholders present in person, by representative or by proxy, holding in aggregate not less than one third of the nominal amount of the relevant class of Preference Shares for the time being outstanding shall form a quorum for the transaction of business. On a poll, each Preference Shareholder present in person or by proxy at the meeting shall have the number of votes equal to the number of that relevant class of Preference Shares, held by the Preference Shareholder. 29

22. Further Issues Subject to the provisions of the MOI, the Issuer shall be at liberty from time to time without the consent of the Preference Shareholders to create and issue to the public further Preference Shares of a class having terms and conditions the same as any of the other classes of Preference Shares issued under the Programme or the same in all respects save for the amount and date of the first payment of dividends thereon, the Issue Price and the Issue Date, so that the further Preference Shares shall be consolidated to form a single Series with the relevant outstanding Preference Shares within a particular class. 23. Governing law 23.1 Ecsponent is a company duly incorporated under the Companies Act. Ecsponent and all the rights and obligations relating to the Preference Shares are governed by, and shall be construed in accordance with, the laws of South Africa. 23.2 Potential investors can obtain all statutory documentation relating to the Company at the registered office of Ecsponent. 24. The Guarantee Fund The holders of Preference Shares that are not listed on the Main Board of the JSE will have no recourse against the JSE or the Guarantee Fund. Claims against the Guarantee Fund may only be made in respect of the trading of the Preference Shares listed on the Main Board of the JSE and in accordance with the rules of the Guarantee Fund and do not relate to the trading on another financial exchange or to a default by the Issuer of its obligations in terms of its obligations under the Preference Shares. 25. Legal Restrictions Other than the exchange control and selling restrictions set out in sections headed Subscription and Sale and Exchange Control Restrictions, respectively, no other legal restrictions exist in terms of which the Preference Shares will be offered, sold, transferred or delivered. 30

PROCEDURES FOR ACCEPTANCE 1. General 1.1 Any offer of Preference Shares in terms of this Programme may constitute an offer to the public. The following parties may not participate any offer made: any person who may not lawfully participate in such an offer; and/or any person acting on behalf of a minor or deceased estate. 1.2 No documentary evidence of capacity to apply need accompany the application for the subscription for Preference Shares, other than as set out in the Application Form (for certificated shares) or in the Applicable Pricing Supplement, but Ecsponent reserves the right to call upon any applicant to submit such evidence for noting, which evidence will be held on file with the Transfer Secretaries or returned to the applicant at the applicant s risk. 1.3 Ecsponent reserves the right to reduce or cancel the issue of Preference Shares at any time prior to the issue. 2. Applications for dematerialised Preference Shares 2.1 Applications for dematerialised Preference Shares must be submitted through a CSDP or broker in accordance with the agreement governing the relationship between the applicant and the CSDP or broker by the cut-off time stipulated by the CSDP or broker. If you are in any doubt as to what action to take, you should consult your broker, attorney or other professional advisor immediately. 3. Applications for certificated Preference Shares 3.1 Application Forms for certificated Class A Preference Shares may only be made on the Application Form Class A Preference Shares (blue), which accompanies this Programme Memorandum, and in accordance with the requirements, terms and conditions set out in that application form and this Programme Memorandum. 3.2 Applications for certificated Class B Preference Shares may only be made on the Application Form Class B Preference Shares (yellow), which accompanies this Programme Memorandum, and in accordance with the requirements, terms and conditions set out in that application form and this Programme Memorandum. 3.3 Applications for certificated Class G Preference Shares may only be made on the Application Form Class G Preference Shares (pink), which accompanies this Programme Memorandum, and in accordance with the requirements, terms and conditions set out in that application form and this Programme Memorandum. 3.4 Application forms and further copies of this Programme Memorandum can be obtained during normal business hours from Ecsponent at Acacia House, Green Hill Village Office Park, The Willows, Pretoria East, 0181 as well as from the Debt Sponsor and the Transfer Secretaries, the addresses of which are set out in the Corporate Information section of this Programme Memorandum. 3.5 Any alterations on an application form must be authenticated by full signature. 3.6 Each application will be regarded as a single application. 31

4. Payment 4.1 Each application must be made to the subscriber s CSDP or broker in terms of the relevant custody agreement. Payment of the total monetary value of dematerialised Preference Shares applied for in Rand will be made in terms of the existing agreement with the appointed CSDP or broker. Delivery will be affected through an allotment of Preference Shares subscribed for, and not on a delivery versus payment basis. 4.2 Payment of the total monetary value of certificated Preference Shares applied for, if applicable, in Rand may be made by: 4.2.1 bank guaranteed cheque (crossed not transferable and with words or bearer deleted) made payable to Ecsponent Ltd Preference Share Programme ; 4.2.2 bankers draft (drawn on a registered bank of South Africa) payable to Ecsponent Ltd Preference Share Programme 4.2.3 EFT into the designated bank account that will be specified in the Applicable Pricing Supplement. 5. Receipts 5.1 Receipts will not be issued for applications, application monies or supporting documents received. 6. Issue and allocation of the Preference Shares 6.1 All Preference Shares subscribed for in terms of this Programme Memorandum will be issued at the expense of Ecsponent. Preference Shares will be issued in South African Rand. 6.2 On the applicable settlement date, the applicant s allocation of dematerialised Preference Shares will be credited to the applicant s CSDP or broker against payment during the Strate settlement runs, prior to the opening of the market. 6.3 Issues of listed Preference Shares will adhere to the recognised and standardised electronic clearing and settlement procedures operated within the JSE environment. 6.4 An Individual Certificate will be posted via registered post to Preference Shareholders, or can be collected from the registered address of the Transfer Secretaries, for certificated Preference Shares, once application money has cleared in the designated bank account and Preference Shares have been allocated and issued. 6.5 Fractions of Preference Shares will not be issued. If a fraction does arise, a cash refund will be made. 6.6 Shares must be fully paid up before issuance and are freely transferable after such issuance. 7. Applications irrevocable 7.1 Applications will be irrevocable and may not be withdrawn once received by Ecsponent and/or the Transfer Secretaries or brokers / CDSPs. 32

8. Copies 8.1 Copies or reproductions of Application Forms will not be accepted, except in the discretion of the Directors. 9. Reservation of rights 9.1 The Directors reserve the right to accept or refuse any application(s), either in whole or in part in accordance with the procedure set out in this Programme Memorandum, or to abate any or all application(s) (whether or not received timeously) in such manner as they may, in their sole and absolute discretion, determine. This reservation of rights applies to any applications for the Preference Shares during the subscription period for each Tranche of Preference Shares. 9.2 The Directors have the right in terms of the Programme to increase the amount of permanent capital raised through the issue of Preference Shares by undertaking a separate private placement or subsequent public offer of Preference Shares not in terms of this Programme. The issue price of these private placements may be negotiated between parties depending on the market conditions at the time. 9.3 At the Last Practicable Date, no options or preferential rights of any kind have been granted, proposed or arranged with any persons to subscribe for the Preference Shares. 10. Representation 10.1 Any investor applying for or accepting the Preference Shares shall be deemed to have represented to Ecsponent that such investor was in possession of a copy of this Programme Memorandum at that time. Any party applying for or accepting Preference Shares on behalf of another investor shall be deemed to have represented to Ecsponent that they are duly authorised to do so and warrant that they and the purchaser for whom they are acting as agent is duly authorised to do so in accordance with all relevant laws and such investor guarantees the payment of the issue price and that a copy of this Programme Memorandum was in the possession of such investor for whom they are acting as agent. 11. Trading of Preference Shares 11.1 Preference Shares listed on the JSE may be traded only on the JSE in electronic form (as dematerialised shares) and will be trading for electronic settlement in terms of Strate immediately following the listing thereof. 11.2 Strate is a system of paperless transfer of securities. If you have any doubt as to the mechanics of Strate please consult your broker, Participant or other appropriate adviser and you are referred to the Strate website (http://www.strate.co.za) for more detailed information. 11.3 Some of the principal features of Strate are: 11.3.1 electronic records of ownership replace certificates and physical delivery of certificates; 11.3.2 trades executed on the JSE must, at the time of publication of this Programme Memorandum, be settled within five Business Days (T + 5 basis); 33

11.3.3 all investors owning dematerialised Preference Shares or wishing to trade their Preference Shares on the JSE are required to appoint either a broker or a CSDP to act on their behalf and to handle their settlement requirements; and 11.3.4 unless investors owning dematerialised Preference Shares specifically request their CSDP to register them as an own-name holder (which entails a fee), their respective CSDP s, or its nominees, holding Preference Shares on their behalf, will be the holder (member) of the Preference Shares and not the investor. 11.3.5 there are penalties for late settlement. 11.4 Subject to the agreement between the investor and the Participant or broker (or the Participant s or broker s nominee company), generally in terms of the rules of Strate, the investor is entitled to instruct the Participant or broker (or the Participant s or broker s nominee company), as to how it wishes to exercise the rights attaching to the Preference Shares and/or to attend and vote at Preference Shareholder meetings or Shareholder meetings at which the Preference Shareholders are entitled to vote. 12. Brokerages and commissions Market related commissions within a specified range will be payable to brokers and/or agents who place Preference Shares. These will be negotiated individually with the brokers. 34

Limited Ecsponent Limited (Incorporated in the Republic of South Africa, under registration number 1998/013215/06 Issue of [nominal amount of Tranche] [Title] of Preference Shares] Under its ZAR5,000,000,000 Preference Share Programme PRO-FORMA APPLICABLE PRICING SUPPLEMENT Set out below is the form of Applicable Pricing Supplement that will be completed for each Tranche of Preference Shares issued under the Programme: This Applicable Pricing Supplement must be read in conjunction with the Programme Memorandum, dated 8 September 2014, prepared by Ecsponent Limited in connection with the Ecsponent Limited ZAR5,000,000,000 Preference Share Programme, as amended and/or supplemented from time to time (the Programme Memorandum). Any capitalised terms not defined in this Applicable Pricing Supplement shall have the meanings ascribed to them in the section of the Programme Memorandum headed Definitions and Interpretations. This document constitutes the Applicable Pricing Supplement relating to the issue of Preference Shares described herein. The Preference Shares described herein are issued on and subject to the Terms and Conditions contained in the Programme Memorandum, as amended and/or supplemented by the terms and conditions contained in this Applicable Pricing Supplement, if applicable. To the extent that there is any conflict or inconsistency between the contents of this Applicable Pricing Supplement and the Programme Memorandum, the provisions of this Applicable Pricing Supplement shall prevail. The Preference Shares are not the subject of an inward listing. DESCRIPTION OF THE PREFERENCE SHARES 1. Issuer Ecsponent Limited 2. Instrument code 3. Rated [Yes / No] 4. Rating [N/A] 5. Status of Preference Shares [N/A] 6. Series Number (ISIN) [ ] 7. Tranche Number [ ] 8. Nominal amount of this Tranche [ ] If Yes, [ ] rating on the long-term [national]/[international] scale Rating agency: [ ], date of review [ ], date of rating [ ] 9. Aggregate nominal amount of Preference Shares in Issue [ ] 10. Issue date [ ] 11. Issue price [ ] 12. Minimum subscription amount [ ] 35

DESCRIPTION OF THE PREFERENCE SHARES 13. Specified Currency ZAR 14. Form of Preference Shares The Preference Shares in this Tranche are [Listed/Unlisted] Preference Shares, issued in dematerialised form and held by Strate 15. Dividend Commencement Date(s) [ ] 16. Applicable Business Day Convention Following Business Day / Preceding Business Day / other convention insert details] 17. Last Day to Trade for Dividend Amount [ ] 18. Last Day to Trade for Redemption Amount [ ] 19. Use of Proceeds [ ] 20. Covenants None 21. Events of default [See paragraph 6 of the Programme Memorandum for default events that could result in a conversion of Preference Shares ] 22. Other terms and conditions not contained in Programme Memorandum [ ] 23. Method of Distribution [Capital will be raised by means of an offer to the general public to subscribe for Preference Shares] 24. Other relevant information [ N/A ] FIXED RATE PREFERENCE SHARES 25. Dividend Rate [ ] percent, per annum, payable monthly in arrears 26. Dividend Payment Dates [ ] 27. First dividend payment date [ ] 28. Dividend periods [ ] 29. Any other items relating to the particular method of calculating dividends (e.g. Day Count Fraction, rounding up provision) [Actual / 365] 30. Redemption Amount [ ] 31. Final Redemption Date [ ] ZERO RATE PREFERENCE SHARES 32. Implied yield [ ] percent, per annum 33. Dividend periods N/A 34. First dividend payment date N/A 35. Redemption Amount [ ] 36. Final Redemption Date [ ] 36

VARIABLE RATE PREFERENCE SHARES 37. Dividend Rate [ ] percent, per annum, payable monthly in arrears 38. Reference price Percent [NACA] [NACM] [NACQ] [NACS] [other method of compounding] 39. Dividend Payment Dates [ ] 40. First dividend payment date [ ] 41. Dividend periods [ ] 42. Manner in which Dividend Rate is to be determined Prime Rate 43. Margin 44. Any other items relating to the particular method of calculating dividends (e.g. Day Count Fraction, rounding up provision) 45. Calculation Agent responsible for calculating amount of principal and dividends [Actual/365] The Issuer 46. Redemption Amount [ ] 47. Final Redemption Date [ ] The total authorised amount of ZAR5,000,000,000 under the Programme Memorandum has not been exceeded Banking details for the payment of subscription money: FNB [ ] ABSA [ ] Standard Bank [ ] Nedbank [ ] Responsibility The Issuer certifies that to the best of its knowledge and belief there are no facts which have been omitted which would make any statement false or misleading and that all reasonable enquiries to ascertain such facts have been made and this Applicable Pricing Supplement contains all information required by law and the JSE Debt Listings Requirements of the JSE. The Issuer accepts full responsibility for the accuracy of the information contained in this Applicable Pricing Supplement, except as otherwise stated therein. Application is hereby made to list this issue of Class [ ] Preference Shares on the JSE s Main Board from [ ]. SIGNED at... on this... day of... 20... For and on behalf of ECSPONENT LIMITED...... Name: Name: Capacity: Director Capacity: Director Who warrants her/his authority hereto Who warrants her/his authority hereto 37

DEFINITIONS AND INTERPRETATIONS In this Programme Memorandum and the annexures hereto, unless inconsistent with the context, an expression which denotes one gender includes the other genders, a natural person includes a juristic person and vice versa, the singular includes the plural and vice versa and the expressions set out in the first column bear the meaning assigned to them in the second column. Act or Companies Act Acquisitions Acquisition Circular Affected Jurisdiction Associates Applicable Laws Applicable Procedures Applicable Pricing Supplement Application Form Beneficial Interest the South African Companies Act, No 71 of 2008, as amended from time to time; collectively, the Ecsponent Botswana Acquisition, the Ecsponent Financial Services Acquisition and the Sanceda Acquisition, as detailed in the Acquisition Circular; the circular distributed to shareholders on or about 26 June 2014, setting out the terms and conditions and details of the Acquisitions, a jurisdiction where the dissemination of the Programme Memorandum or the making of the offer to subscribe for Preference Shares may be illegal or fails to conform to the laws of such jurisdiction or requires any type of registration or the like with any regulator or public body or the like including, without limitation, the United States of America, Canada, Australia and Japan (absent an applicable exemption from registration requirements); group companies over which Ecsponent has significant influence, significant influence being the power to participate in the financial and operating policy decisions but not control them. An entity is generally considered to have significant influence when it holds between 20% and 49% of the voting power in the said group company; in relation to any Person, all and any statutes and subordinate legislation and common law, regulations, ordinances and by-laws, directives, codes of practice, circulars, guidance notices, judgments and decisions of any competent authority, or any governmental, intergovernmental or supranational body, agency, department or regulatory, self-regulatory or other authority or organisation and other similar provisions, from time to time, compliance with which is mandatory for that Person; the rules and operating procedures for the time being of Strate, the Participants and the JSE, as the case may be; in relation to a Tranche of Preference Shares, the pricing supplement completed and signed by the Issuer in relation to that Tranche of Preference Shares, setting out the additional and/or other terms and conditions as are applicable to that Tranche of Preference Shares, based upon the pro forma pricing supplement which is set out the section of the Programme Memorandum headed Pro Forma Applicable Pricing Supplement ; collectively, the application forms for the application of Class A Preference Shares, Class B Preference Shares, Class C Preference Shares and/or Class G Preference Shares, respectively, offered under this Programme, copies of which are attached to this Programme Memorandum; ownership of a beneficial interest in a dematerialised Preference Share held directly in Strate, through a CSDP or Participant; 38

Board or Directors Broker Business Day Calculation Agent the board of directors of Ecsponent as at the date of this Programme Memorandum; any person registered as a broking member (equities) in terms of the rules of the JSE, issued and published in accordance with the provisions of the FMA; any day of the week, excluding Saturdays, Sundays and all official South African public holidays; the calculation agent specified in the Applicable Pricing Supplement, and, for the time being, the Issuer; Certificated Shares CIPC Class A Preference Share Class B Preference Share Class C Preference Share Class G Preference Share Common Monetary Area Shares which have not been dematerialised, title to which is represented by an Individual Certificate; the South African Companies and Intellectual Property Commission (formerly known as CIPRO); a five year, fixed-rate, redeemable, cumulative, non-participating Preference Share of no par value, with a Redemption Amount of 100% of the Initial Issue Price per Preference Share, attracting dividends at a rate of 10% per annum, not compounded, and subject to such further preferences, rights, limitations and other terms associated with such class set out in schedule 2 of the MOI; a five year, zero-rate, redeemable, non-participating Preference Share of no par value, with a Redemption Amount of 170% of the Initial Issue Price per Preference Share, subject to the preferences, rights, limitations and other terms associated with such class set out in Schedule 2 of the MOI; a five year, variable-rate, redeemable, cumulative, non-participating Preference Share of no par value, with a Redemption Amount of 100% of the Initial Issue Price per Preference Share, attracting dividends at a rate equal to Prime Rate plus 4% per annum, not compounded, and subject to such further preferences, rights, limitations and other terms associated with such class set out in Schedule 2 of the MOI; a five year, fixed-rate, redeemable, cumulative, non-participating Preference Share of no par value, with a Redemption Amount of 100% of the Initial Issue Price per Preference Share, attracting dividends at a rate of 11.2% per annum, not compounded, and subject to such further preferences, rights, limitations and other terms associated with such class set out in schedule 2 of the MOI; collectively, South Africa, the Republic of Namibia and the Kingdoms of Lesotho and Swaziland; Companies Regulations the regulations published by the Minister of Trade and Industry in terms of section 120 and 223 of the Act; Cryo-Save SA Cryo-Save South Africa Proprietary Limited (registration number: 2010/009754/07), a private company having its registered address at Acacia House, Green Hill Village Office Park, Cnr of Nentabos and Botterklapper Street, The Willows, Pretoria East; CSD a central securities depository as defined in section 1 of the FMA; 39

DEFINITIONS AND INTERPRETATIONS CSDP or Participant Day Count Fraction Dealers Debt Sponsor and Corporate Advisor Directors Dividend Amount Dividend Commencement Date Dividend Finalisation Date Dividend Last Day to Trade Dividend Ex-Date Dividend Rate Dividend Rate Determination Date Dividend Record Date a person accepted by Strate as a participant in terms of section 31 of the Financial Markets Act, and comprises, for the time being, FirstRand Bank Limited, Nedbank Limited, The Standard Bank of South Africa Limited, Citibank N.A. South Africa Branch, Standard Chartered Bank, Johannesburg Branch, Société Générale Johannesburg Branch, Link Investor Services, Eskom Holdings SOC Limited, Computershare Limited and the South African Reserve Bank; in relation to the calculation of an amount for any period of time applicable to a Tranche of Preference Shares (where applicable), the day count fraction specified as such in the Terms and Conditions or the Applicable Pricing Supplement and, specifically, if Actual/365 is specified, means the actual number of days in the Dividend Period divided by 365 (three hundred and sixty-five); one or more dealers appointed by the Issuer from time to time in respect of any particular Tranche of Preference Shares, as specified in the Applicable Pricing Supplement; Questco; the board of directors of the Company; the ZAR amount of dividends payable in respect of each Preference Shares, in accordance with Condition 10 (Entitlement to Dividends); in relation to a Tranche, other than a Tranche of zero rate Class B Preference Shares, the first date from which dividends will accrue, as specified in the Applicable Pricing Supplement the day on which finalisation information regarding Dividend Amounts to be paid will be published on SENS, which will be ten Business Days before Dividend Record Date (as at Last Practicable Date), in line with Schedule 18 of the JSE Listings Requirements, from time to time; the last day to trade in Preference Shares cum-dividend, which will be the Friday (five Business Days) before Dividend Record Date (as at Last Practicable Date), in line with Schedule 18 of the JSE Listings Requirements, from time to time; the date on which Preference Shares start trading ex-dividend, and will be one Business Day after the Dividend Last Day to Trade (as at Last Practicable Date) in line with Schedule 18 of the JSE Listings Requirements, from time to time; the rate to be used in calculating the Dividend Amount which can be a fixed or variable rate; in relation to a Tranche of variable rate Preference Shares, the day on which the applicable Dividend Rate will be determined, and will be specified in the Applicable Pricing Supplement; the date on which Preference Shareholders must be recorded in the Register in order to qualify for a Dividend Amount, which will be the Friday (five Business Days) before Dividend Payment Date (as at Last Practicable Date), in line with Schedule 18 of the JSE Listings Requirements, from time to time; 40

Dividend Payment Date Dividend Period Ecsponent Ecsponent Botswana Ecsponent Botswana Acquisition Ecsponent Capital Ecsponent CS Ecsponent Financial Services Ecsponent Financial Services Acquisition in relation to a Tranche of Preference Shares, the dividend payment date(s) specified in the Applicable Pricing Supplement, which will be the first Business Day after the Dividend Record Date (as at Last Practicable Date); in relation to a Tranche of Preference Shares, each period beginning on (and including) the Dividend Commencement Date or any Dividend Payment Date and ending on (but excluding) the immediately following Dividend Payment Date; Ecsponent Limited (registration number 1998/013215/06), a public company duly registered and incorporated under the laws of South Africa and listed on the VCM on the JSE, having its registered address at Acacia House, Green Hill Village Office Park, Corner of Nentabos and Botterklapper Streets, The Willows, Pretoria East; Ecsponent Limited, formerly Escalator Investment Holdings Limited (registration number CO.2010/7658), a public company duly registered and incorporated under the laws of Botswana, having its registered address at Exponential Building, 6th Floor, Plot 54351, New CBD, Gaborone, Botswana; the acquisition by Ecsponent of a 100% interest in Ecsponent Botswana in terms of an agreement dated 5 March 2014 between Ecsponent and Escalator Mauritius, for a purchase consideration of R5 000 000, payable through the increase in the shareholder loan from Ecsponent Capital, which loan will be settled through the Rights Offer; Ecsponent Capital (RF) Limited, formerly Escalator Capital (RF) Limited (registration number 2009/015563/06), a public company duly registered and incorporated in South Africa, having its registered address at Acacia House, Green Hill Village Office Park, Corner of Nentabos and Botterklapper Streets, The Willows, Pretoria East. Ecsponent Capital is controlled by Escalator Mauritius; Ecsponent Credit Services Proprietary Limited,, formerly Escalator Credit Services, (and previously JDH Credit Services and and Viscacom Proprietary Limited) (registration Number 2010/015744/07), a private company duly registered and incorporated under the laws of South Africa; having its registered address at 11 Acacia House, Green Hill Village Office Park, Corner of Nentabos and Botterklapper Streets, The Willows, Pretoria East; Ecsponent Financial Services Proprietary Limited, formerly Escalator Financial Services Proprietary Limited (and previously Tiespro 69 (Pty) Ltd) (registration number 2006/012668/07), a private company duly registered and incorporated under the laws of South Africa, having its registered address at, Acacia House, Green Hill Village Office Park, Corner of Nentabos and Botterklapper Streets, The Willows, Pretoria East; the acquisition by Ecsponent of Ecsponent Financial Services in terms of an agreement dated 5 March 2014 between Ecsponent and Escalator Mauritius, with effect from 1 January 2014, for a purchase consideration of R15 000 000, settled by way of an increase in the loan account owing to Ecsponent Capital, which loan will be settled through the Rights Offer; 41

DEFINITIONS AND INTERPRETATIONS Escalator Mauritius Ecsponent Swaziland Esperite N.V Exchange Control Regulations Financial Markets Act or FMA Escalator Capital Global Limited (Registration number 106994 C1/GBL), a public company duly registered and incorporated with limited liability in accordance with the laws of Mauritius its main place of business situated at 2nd Floor, Caudan Peninsula, Falcon Street Port Louis, Mauritius; Ecsponent Limited, formerly Escalator Limited (Registration number R7/38733), a public company duly registered and incorporated with limited liability in accordance with the laws of the Kingdom of Swaziland with its main place of business situated at 7 The Gables, Ezulwini, Swaziland, a newly formed company incorporated on 16 July 2013, in which Ecsponent owns 84.71% pursuant to a subscription for new shares for a consideration of R1 000, with effect from 1 January 2014; Esperite Group N.V., previously Cryo-Save Group N.V. (registration number 27187482), a public holding company, duly registered and incorporated in accordance with Dutch law, having its registered address at Piet Heinstraat 11a, 7204 Zutpen, The Netherlands, dual listed on NYSE Euronext Amsterdam and Euronext Paris and specialising in harvesting and storing of stem cells. Esperite N.V. is a 50% shareholder in Cryo-Save SA; the South African Exchange Control Regulations, 1961, as amended, promulgated in terms of section 9 of the South African Currency and Exchanges Act, 1933 (Act 9 of 1933), as amended or replaced from time to time; the South African Financial Markets Act, 2012 (Act 19 of 2012) (which replaced the Securities Services Act, 2006), as amended or replaced from time to time; FSMA the Financial Services and Markets Act, 2000 Grapetek the Group the Guarantee Fund Individual Certificate Initial Issue Date Initial Issue Price Issuer or the Company Issue Date Grapetek Proprietary Limited (registration number: 2012/035730/07), a private company that acquired certain assets from assets from Vinguard in January 2014; Ecsponent and its subsidiaries and associates from time to time; the guarantee fund, operated by the JSE as a separate guarantee fund, in terms of sections 8(1)(h) and 17(2)(w) of the Financial Markets Act or any successor fund; a Preference Share in the definitive registered form of a single certificate and being a certificate exchanged for a Beneficial Interest in accordance with Condition 14 (Exchange of Beneficial Interests and Replacement of Individual Certificates) and any further certificate issued in consequence of a transfer thereof; the date at which a particular Series of Preference Shares is first issued by the Company (i.e. the date of the first Tranche of Preference Shares in a Series); the price at which a Series of Preference Shares is first offered to the public (i.e. the Issue Price of the first Tranche of Preference Shares in a Series) and which will be determined by the Issuer prior to the Initial Issue Date; Ecsponent; in relation to a Tranche of Preference Shares, the date of issue of that Tranche, as specified in the Applicable Pricing Supplement; 42

Issue Price Implied Yield the JSE JSE Debt Listings Requirements JSE Listings Requirements the price paid per Preference Share in a particular Tranche of Preference Shares issued, which price may be at a discount or premium to the Initial Issue Price; in relation to a Tranche of zero rate Class B Preference Shares, the yield accruing on the Issue Price of such Preference Shares, as specified in the Applicable Pricing Supplement; the JSE Limited (Registration Number 2005/022939/06), a public company duly registered and incorporated under the laws of South Africa and licensed as a securities exchange under the FMA; the debt listings requirements of the JSE, as amended from time to time; the listings requirements of the JSE, as amended from time to time; King III Report being the King Report on Corporate Governance in South Africa 2009; Last Practicable Date Link Market Service Listing Termination Date Memorandum of Incorporation or MOI Paying Agent Preference Shares Preference Shareholders Prime Rate Programme being the last practicable date prior to the finalisation of this Programme Memorandum; Link Market Services South Africa Proprietary Limited (registration number: 2000/007239/07), a private company duly registered and incorporated under the laws of South Africa and having its registered address at 13th Floor, Rennie House, 19 Ameshoff Street, Johannesburg, 2001; the date on which the listing of the redeemed Preference Shares will be terminated, which will be two Business Days after Redemption Record Date, in line with Schedule 18 of the JSE Listings Requirements, as amended from time to time; the current Memorandum of Incorporation of Ecsponent as at the date of this Programme Memorandum, which MOI was approved by Shareholders on 25 August 2015 and acknowledged by CIPC as having been filed on 25 August 2015; First National Bank Limited; collectively, the Class A Preference Shares, Class B Preference Shares, Class C Preference Shares and Class G Preference Shares, which are the preference shares the Company may offer to the public under this Programme Memorandum; the holders of Preference Shares (whether certificated or dematerialised form); the publicly quoted basic rate of interest levied by First National Bank Limited ( FNB ) from time to time on overdraft, calculated on a 365-day year, irrespective of whether the applicable year is a leap year, and proved, prima facie, in the event of a dispute and in the absence of manifest error, by a certificate under the hand of any director or manager of FNB, whose appointment and authority need not be proved; the Ecsponent Limited ZAR5,000,000,000 Preference Share Programme under which Ecsponent may, from time to time, issue multiple Tranches of Preference Shares; 43

DEFINITIONS AND INTERPRETATIONS Programme Amount the maximum aggregate outstanding nominal amount of all of the Preference Shares that may be issued under the Programme at any one point in time, being ZAR5,000,000,000, or such increased amount as is determined by the Issuer from time to time, subject to the Applicable Procedures and Applicable Laws, as set out in the section of this Programme Memorandum headed General Description of the Programme ; Programme Date the date of this Programme Memorandum being 8 September 2014; Programme Memorandum Prospectus Questco Rand or R or ZAR Redemption Amount Redemption Finalisation Date Redemption Last Day to Trade Redemption Payment Date Redemption Record Date Redemption Suspension Date Register this bound document dated 15 December 2015, including all annexures and enclosures hereto and future Applicable Pricing Supplements issued in connection with the Programme, which sets out the detail of the Programme; the prospectus issued by Ecsponent in terms of which the first Tranche of Class A, Class B and Class C Preference Shares under this Programme was offered to the public on 7 October 2014, being 1 000 000 Class A Preference Shares, 1 000 000 Class B Preference Shares and 1 000 000 Class C Preference Shares; Questco Proprietary Limited (Registration number 2002/005616/07), a private company duly incorporated in accordance with the laws of South Africa; South African Rand, the official currency of South Africa; in relation to a Tranche of Preference Shares, the principal amount specified in the Applicable Pricing Supplement payable in respect of such Tranche of Preference Shares upon the Redemption Date; the day on which finalisation information regarding Redemption Amounts to be paid will be published on SENS, which will be ten Business Days before Redemption Record Date (at Last Practicable Date), in line with Schedule 18 of the JSE Listings Requirements, from time to time; the last day on which Preference Shares to be redeemed can be traded on the JSE, which will be five Business Days before Redemption Record Date (at Last Practicable Date), in line with Schedule 18 o the JSE Listings Requirements, from time to time; in relation to a Tranche of Preference Shares, the day on which Redemption Amounts are paid, which will be one Business Day after Redemption Record Date (at Last Practicable Date), in line with Schedule 18 of the JSE Listings Requirements from time to time; in relation to a Tranche of Preference Shares, the date upon which the Preference Shares are redeemed by the Issuer and the day on which Preference Shareholders must be recorded in the Register in order to receive the Redemption Amount, in accordance with Condition 5 (Redemption of Preference Shares), and as specified in the Applicable Pricing Supplement; the day on which Preference Shares to be redeemed are suspended on the JSE trading system, in line with Schedule 18 of the JSE Listings Requirements from time to time; means the register of Preference Shareholders maintained by the Transfer Secretaries in terms of Condition 16 (Register); 44

Rights Offer Salveo Sanceda Sanceda Acquisition the R100 million rights offer to be undertaken by Ecsponent, which rights offer opens on 8 September 2014 as announced on SENS on 26 August 2014; Salveo Swiss Technologies Limited (formerly Lazaron Biotechnologies (SA) Limited) (registration number 2004/004630/06), a public company duly registered and incorporated under the laws of South Africa, a subsidiary of Ecsponent, having its registered address at Acacia House, Green Hill Village Office Park, Cnr of Nentabos and Botterklapper Street, The Willows, Pretoria East; Sanceda Collections (Pty) Limited (registration number 2010/015747/07), a private company duly registered and incorporated under the laws of South Africa having its registered address at Acacia House, Green Hill Village Office Park, Cnr of Nentabos and Botterklapper Street, The Willows, Pretoria East; the acquisition by Ecsponent of the assets, leased assets, marks (being patents, trademarks, brands, designs) and goodwill of Sanceda in terms of an agreement dated 5 March 2014 between Ecsponent and Sanceda for a purchase consideration of R7 000 000 to be settled by way of the assumption of ongoing liabilities associated with the leased assets and the balance in cash, which cash portion will be funded by Ecsponent Capital on loan account; Sanceda Services Sanceda Collection Services (Pty) Ltd (registration number 2011/125932/07), a private company duly registered and incorporated under the laws of South Africa having its registered address at Acacia House, Green Hill Village Office Park, Cnr of Nentabos and Botterklapper Street, The Willows, Pretoria East; SENS Series the Securities Exchange News Service of the JSE; a Tranche of Preference Shares together with any further Tranche or Tranches of Preference Shares which are: a) expressed to be consolidated and form a single series; and b) identical in all respects (including as to listing) except for their respective Issue Dates, Dividend Commencement Dates and/or Issue Prices; Shares or Ordinary Shares Shareholders Strate ordinary shares of no par value in the issued share capital of Ecsponent; the registered holders of Ordinary Shares; Strate Proprietary Limited (registration number 1998/022242/07), a private company with limited liability incorporated in accordance with the company laws of South Africa and registered and licensed as a CSD in terms of the Financial Markets Act or any successor CSD, or any additional or alternate depository approved by the Issuer; 45

Subsidiaries Tranche Transfer Secretaries Terms and Conditions USA Vinguard group companies over which Ecsponent has control; control being the power to govern the financial and operating policies of an entity so as to obtain benefits from its activities. The power to govern the financial and operating policies of an entity usually exist when an entity has more than 50% of the voting power within the said entity, but control can also exist pursuant to: an agreement with other investors provisions of statute or an agreement the appointment or removal of the majority of the members of the board of directors casting the majority of votes at a meeting of the board of directors; means a particular issuance of Preference Shares issued to the market in a particular Series, of which all Preference Shares are identical in all respects (including as to listing, Issue Dates, Dividend Commencement Dates and Issue Prices); for the time being, Link Market Services; the terms and conditions incorporated in the section of this Programme Memorandum heading Terms and Conditions of the Preference Shares ; the United States of America; and Vinguard Limited (Registration Number 2002/026858/06), a public company duly registered and incorporated under the laws of South Africa, having its registered address at Acacia House, Green Hill Village Office Park, Cnr of Nentabos and Botterklapper Street, The Willows, Pretoria East and a subsidiary of Ecsponent. 46

RISK FACTORS The Issuer believes that the factors described below, which are not set out in any particular order, represent key risks inherent in investing in the Preference Shares, but the inability of the Issuer to pay dividends, the Redemption Amount or other amounts on or in connection with any Preference Shares may occur for other reasons which may not be considered significant risks by the Issuer based on information currently available to it, or which it may not currently be able to anticipate. Some risks are not yet known and some that are not currently deemed material could later turn out to be material. Accordingly, the Issuer does not represent that the statements below regarding the risks of holding of any Preference Shares are exhaustive. All of these risks could materially affect the Group, its reputation, business, results of its operations and overall financial condition. The information set out below is therefore not intended as advice and does not purport to describe all of the considerations that may be relevant to a prospective investor. Investors contemplating making an investment in the Preference Shares should determine their own investment objectives and experience, and any other factors which may be relevant to them in connection with such investment. 1.1 Risks associated with the group and its operations 1.1.1 Risk management The Issuer is exposed to commercial and market risks in the ordinary course of its business. Given the strategic redirection of the Company into the financial sector, the most significant of these risks is credit risk, interest rate risk, liquidity risk, regulatory risk and operational risk. Credit risk is the risk of loss due to the non-performance of the borrower to repay the financial obligation as a result of the deterioration in the financial position of such borrower. Interest rate risk is the sensitivity of the financial performance and/ or the financial position of the Issuer due to unexpected movement in the interest rate. Liquidity risk is the risk of not being able to meet funding or trading obligations as they become due. Regulatory risk relates to changes in legislation within the operating environments of the businesses resulting in potentially negative results. Operational risk is the risk of incurring loss as a result of inadequate or failed policies and procedures, people, or from external events. Whilst the Company believes that they have implemented appropriate systems and controls to identify and mitigate such risks, investors should be aware that the failure to control such risks could have a negative impact on the performance and reputation of the business and that certain inherent risk are outside of the control of the Directors or the Company. 1.1.2 Focus on the South African consumer market results in a geographic concentration risk The Company s operations are currently mainly focused on the South African market, with recent acquisitions including start-up businesses being established in Botswana, Zambia and Swaziland, whose economies rely, to some extent, on that of South Africa. A business plan for operations in Namibia has been established and it is expected to be rolled out during 2015. The Company therefore faces a geographic concentration risk in South Africa and any adverse effects on the Southern African economy are likely to have an adverse impact on the operating performance of the Company, specifically with regards to the ability of consumers to pay for financial services and to service their debt requirements. Whilst the diversity of the Groups products and footprint are intended to provide improved investment security the Issuer cannot guarantee against adverse events which could impact on its ability to pay dividends and/or Redemption Amounts. 47

1.1.3 Liquidity risk The Company s ability to make monthly dividend payments on or to redeem Preference Shares depends on the financial position and operating performance of the operational subsidiaries, which is subject to the economic climate at the time, and may be out of the Company s control. The Issuer cannot make assurances that its operational subsidiaries will generate sufficient cash flow to satisfy the obligations for dividends and Redemption Amounts under the Preference Shares. This could place liquidity risk on the business. Management mitigate these risks as far as possible by implementing and maintaining effective management information systems. 1.1.4 The Group s success is dependent on key members of management, the loss of which could have an adverse impact on their business The success of the Group is dependent on its ability to attract and retain key management skills. Loss of key members of management would impact on the Group s ability to perform operationally. The risk is mitigated by providing key members of management with longer term incentive contracts and equity opportunities. 1.1.5 A system failure could cause delays or interruptions in service which could cause us to lose clients The Group subsidiaries are reliant on operational systems including online financial services systems, call centre operations, regional management control and financial management. Catastrophic failure of the IT infrastructure could impact negatively on the Group s ability to fulfil its obligation to the Preference Shareholders. Management mitigates the IT risk by deploying redundancy and backup alternatives. 1.1.6 Being unable to keep up with developments in technology may adversely affect business As a service provider that is reliant on technology to ensure appropriate levels of service, keeping abreast of developments in technology utilised in the industry is essential for a sustainable business. Cryo-Save and Salveo rely on their respective principles to ensure that they maintain cutting edge technological dominance. The distributed financial services subsidiaries all rely on a common state of the art banking system to minimise the likelihood for fraud, ensure correct levels of return and minimise bad debt. 1.1.7 The Issuer may require additional capital in the future for growth The Company cannot make assurances that it will be able to generate sufficient cash flow internally, or obtain alternative sources of capital on favourable terms to ensure the continuous growth of the Group. A lending and financial services business is dependent on internally generated cash flow or access to capital to grow the loan books on which it derives profits. 48

1.2 Risks relating to the consumer finance industry 1.2.1 Increased competition in consumer finance space could lead to difficult trading conditions Profit margins generated in the consumer finance industry may be an attractive incentive for new entrants into the market. Although some of the Company s subsidiaries operate in industries where the barriers to entry are high, this is not necessarily the case for the financial services sector in which the Company will redirect its focus. Competition may increase in some or all of the Company s principal markets and may have an adverse effect on its financial condition and the results of its operations. In addition competition which has access to low cost of capital has a significant competitive advantage. 1.2.2 Change in interest rates or regulatory change Any reduction of the interest rates or changes in legislation could reduce the returns generated from loan books. A decrease in interest rates results in a shift in appetite away from medium to high risk consumers as interest rates charged may not match the risk accepted. The Company intends to focus on all areas of high to low risk consumers. Any decrease in the interest rate can negatively affect returns and may result in a mismatch of risk and return, forcing the Group to reassess its target market. Changes in the regulatory framework related to provision of credit or recovery of debt is a significant risk which could result in potentially negative returns for the Group s subsidiaries. 1.2.3 Business may be adversely impacted by the financial position and performance of consumers The global financial crisis resulted in many consumers either losing their employment as companies sought to reduce expenditure by decreasing headcount, or many of those that did not lose their job were not given an increase or bonus. As the cost of living increases there is reduced disposable income to either service existing debt, or against which new loans can be advanced. Given that the Group will focus on all areas of high to low risk consumers, as well as the collection of distressed books, the Group may be more susceptible to the credit risk inherent in consumers than other financial services sectors. 1.3 Risks relating to the preference shares The terms and conditions and inherent features of the Preference Shares result in specific risks that potential investors must take note of: 1.3.1 Conversion In the event that the Issuer is unable to pay dividends and/or Redemption Amounts due to the Preference Shareholders, Preference Shares become convertible into ordinary Shares of the Issuer. Ordinary Shares rank after other creditors of the Group on liquidation and have no right to enforce the Group to pay dividends. Potential investors should familiarise themselves with the rights and obligations due to an ordinary Shareholder, as well as those of a Preference Shareholder. 49

1.3.2 Ranking in event of liquidation Preference Shares are unsecured and rank behind all creditors and loan providers in the event of liquidation. Upon liquidation of Ecsponent, payments of Dividend and Redemption Amounts can only be enforced after creditors and loan providers have been paid in full. Payment of dividends and any interest on Class G Preference shares also rank after Class A, Class B and Class C preference shares. 1.3.3 Solvency and liquidity requirements The Act requires any company to comply with solvency and liquidity test requirements before any payments to shareholders are authorised by the board of directors (whether ordinary or preferred shareholders, and whether payments are of a dividend or capital nature). Solvency is when the assets of a company, fairly valued, exceed the liabilities and liquidity is when a company can pay its debts in the ordinary course of business. Should the Company fail to meet the solvency and liquidity requirements, the payment of any dividend or Redemption Amount will be prohibited until such a time as the solvency and liquidity test can be met. 1.3.4 Variable rate Preference Shares The dividends accumulating on variable rate Preference Shares are linked to the Prime Rate. Any movement in the Prime Rate will therefore directly affect the returns received by variable rate Preference Share investors. 1.3.5 Unsecured and not Guaranteed The Preference Shares will be obligations solely of the Issuer and are not secured or guaranteed in any manner. In particular, without limitation, the Preference Shares will not be obligations of, and will not be guaranteed by any party mentioned in this Programme Memorandum. 1.4 Reliance on CSDP s procedures for transfer, payment and communication with the Issuer Preference Shares issued under the Programme which are listed on the Main Board of the JSE or such other or additional Financial Exchange will be issued in uncertificated form. Preference Shares held in Strate will be issued, cleared and settled in accordance with the Applicable Procedures through the electronic settlement system of Strate. Except in the limited circumstances described in the Terms and Conditions, investors will not be entitled to receive Individual Certificates. Strate will maintain records of the Beneficial Interests in Preference Shares and/or Preference Shares issued in uncertificated form, which are held in Strate. Investors will be able to trade their Beneficial Interests only through Strate and in accordance with the Applicable Procedures. Payments of dividend and Redemption Amounts in respect of uncertificated Notes will be made to the Participants and the Issuer will discharge its payment obligations under the Preference Shares by making payments to, or to the order of, the Participants for distribution to their account holders. A holder of a Beneficial Interest in uncertificated Preference Shares, whether listed or unlisted, must rely on the procedures of Strate to receive payments under the relevant Preference Shares. Each investor shown in the records of Strate or the Participants, as the case may be, shall look solely to Strate or the Participant, as the case may be, for his share of each payment so made by the Issuer to the registered holder of such uncertificated Preference Shares. The Issuer has no responsibility or liability for the records relating to, or payments made in respect of, such Beneficial Interests. 50

Holders of Beneficial Interests in uncertificated Preference Shares who have not elected own-name registration will not have a direct right to vote in respect of the relevant Preference Shares. Instead, such holders will be permitted to act only to the extent that they are enabled by the CSDP to appoint appropriate proxies. 1.5 There is no active trading market for the preference shares The Preference Shares issued under this Programme will be new securities which may not be widely distributed and for which there is currently no active trading market. While the intention is to list the Preference Shares on the Main Board of the JSE, there can be no assurance that the Group will be able to maintain such listing or that a trading market will develop for the Preference Shares. If the Preference Shares are traded after their initial issuance, they may trade at a discount to their Initial Issue Price, depending upon prevailing interest rates, the market for similar securities, general political and economic conditions, the condition of the financial sector, the financial condition of the Issuer, the Issuer s financial performance and future prospects. 1.6 The preference shares may not be a suitable investment for all investors Each potential investor in any Preference Shares must determine the suitability of that investment in light of its own circumstances. In particular, each potential investor should: 1.6.1 have sufficient knowledge and experience to make a meaningful evaluation of the Preference Shares, the merits and risks of investing in the Preference Shares and the information contained or incorporated by reference in this Programme Memorandum or any Applicable Pricing Supplement; 1.6.2 have access to, and knowledge of, appropriate analytical tools to evaluate, in the context of its particular financial situation, an investment in the Preference Shares and the impact such an investment will have on its overall investment portfolio; 1.6.3 have sufficient financial resources and liquidity to bear all of the risks of an investment in the Preference Shares; 1.6.4 understand thoroughly the terms of the Preference Shares and be familiar with the behaviour of any relevant interest rates and financial markets; and 1.6.5 be able to evaluate (either alone or with the help of a financial adviser) possible scenarios for economic, interest rate and other factors that may affect its investment and its ability to bear the applicable risks. 1.7 General Risks 1.7.1 Change of law No assurance can be given as to the impact of any possible judicial decision or change to South African law or the law of any other jurisdiction or administrative practice after the listing of the Preference Shares. 1.7.2 Legal investment considerations may restrict certain investments The investment activities of certain investors are subject to legal investment laws and regulations, or review or regulation by certain authorities. Each potential investor should consult its legal advisers to determine whether and to what extent: (1) Preference Shares are legal investments for it; (2) Preference Shares can be used as collateral for various types of borrowing; and (3) other restrictions apply to its purchase or pledge of any Preference Shares. Financial institutions should consult their legal advisers or the appropriate regulators to determine the appropriate treatment of Preference Shares under any applicable risk-based capital or similar rules. 51

1.7.3 Foreign Exchange Control Foreign derived loan capital or equity capital may be introduced into South Africa through a formal system of Exchange Control as summarised in the section entitled South African Exchange Control of this Programme Memorandum. However, unless the prior approval of the South African Reserve Bank has been obtained, the proceeds from the sale of assets in South Africa owned by a non-resident are not remittable to the non-resident. 1.7.4 Financial Markets A prospective investor of the Preference Shares should be aware of the prevailing and widely reported global credit market conditions (which continue at the date hereof), whereby there is a general lack of liquidity in the secondary markets for instruments similar to the Preference Shares. The Issuer cannot predict if and when these circumstances will change, and if and when they do, whether conditions of general market illiquidity for the Preference Shares and instruments similar to the Preference Shares will return in future. 1.7.5 Credit Rating Neither the Issuer, nor the Programme, nor the Preference Shares has been rated. A Rating, should it be assigned, is not a recommendation to buy, sell or hold securities and may be subject to suspension, reduction or withdrawal at any time by the assigning Rating Agency. Any adverse change in an applicable credit rating could adversely affect the trading price for the Preference Shares issued under the Programme 52

USE OF PROCEEDS Words used in this section headed Use of Proceeds shall bear the same meanings as used in the section headed Definitions and Interpretations and as defined elsewhere in this Programme Memorandum, except to the extent that they are separately defined in this section or the context otherwise requires. Ecsponent has made, and is in the process of making, numerous business acquisitions, specifically the Acquisitions detailed in the recent Acquisition Circular, with the intention of directing the core focus of the Company towards financial services. In view of promoting this path, Ecsponent has created and intends marketing listed products to both retail and institutional investors. The Board believes the listing of these products will substantially improve market acceptance of a similar (but unlisted) product range which is currently on offer by Ecsponent Capital. It is also the Company s intention to further expand the product range thereby bolstering the future prospects of the Company. Ecsponent s business model requires continuous funding for, inter alia, its micro finance businesses and preference shares are considered an optimal source of funding for these on-going business needs. The proceeds of Preference Shares issued will be used by Ecsponent to fund the future growth of the Company on an ongoing basis and for general corporate purposes. Funding will be raised through the issue of Preference Shares as and when needed and there is no minimum subscription amount. 53

DESCRIPTION OF THE ISSUER History of the Company 1.1 Ecsponent Limited (previously John Daniel Holdings Limited, registration number 1998/013215/06) was first incorporated as a private company in March 1995, after which it converted to a public company on 9 July 1998 and has been in operation for 16 years. It was listed on the Venture Capital Market of the JSE on 6th August 1998. 1.2 The Group structure is set out below: Lazaron Biotechnologies 54

1.3 The names, dates and places of incorporation of the Company s subsidiaries are set out in the table below. Name of subsidiary Place of Incorporation Date of Incorporation Cryo-Save SA (Pty) Ltd South Africa 17 May 2010 Cryo-Save Namibia (Pty) Ltd South Africa 8 June 2011 Vinguard Ltd South Africa 29 October 2002 Salveo Swiss Technologies Ltd South Africa 24 February 2004 Ecsponent Financial Holdings (Pty) Ltd South Africa 4 April 2011 Ecsponent Credit Services (Pty) Ltd South Africa 28 July 2010 Komo Finance (Pty) Ltd South Africa 2 June 2005 Ecsponent Financial Services (Pty) Ltd South Africa 24 April 2006 Ecsponent Limited (Botswana) Botswana 24 August 2010 Sure Choice (Pty) Ltd Botswana 14 April 2009 Ecsponent Holdings Limited (Swaziland) Swaziland 16 July 2013 Sanceda Collection Services (Pty) Ltd South Africa 14 October 2011 Ligagu Investments (Pty) Ltd South Africa 19 November 2007 Lazaron Biotechnologies (Pty) Ltd (formerly JDH Venture Capital (Pty) Ltd) South Africa 19 August 2011 Ecsponent Financial Services (Pty) Ltd Zambia 16 July 2014 K201125942 (Pty) Ltd South Africa 14 October 2011 55

About the Company 1.4 Ecsponent Limited is a specialist financial services Group of companies. The Group generates wealth through investment in financial and private equity assets in specific niche market sectors. 1.5 With a small management team, it functions as a pure holding company which develops interests in operational subsidiaries. Ecsponent focusses on the following operational segments: Financial Services in South Africa and the common monetary areas; Financial Services in the rest of Africa; and Private equity investments. 1.6 The Company s primary focus is financial services. Ecsponent ensures the strategic alignment of its investment targets by applying a highly focused approach to the acquisitions. Core to the approach is the ability of the target business that provide high barriers to entry and high gross profits resulting in above average levels of returns which are sustainable. 1.7 The diagram below sets out the operational structure of the Group: Limited Investments Financial Services South Africa Financial Services Rest of Africa Cryo-Save Salveo Ecsponent Credit Services (NCR)* Sanceda Services Ecsponent Botswana Ecsponent Swaziland Vinguard Lazaron Ecsponent Financial Services (FSB)* Komo Finance Ecsponent Zambia 56

Prospects and state of affairs of Ecsponent and its subsidiaries 1.8 Ecsponent effects governance and oversight in respect of the Group s subsidiaries and provides central services such as administration, treasury, management accounting, IT, legal, HR & payroll, etc. Ecsponent adds value to its subsidiaries by: providing capital raising expertise; JSE Listings Requirements compliance and the associated governance; management support and access to industry specialists; and access to National Credit Act ( NCR ) and Financial Services Board ( FSB ) licences. 1.9 The prospects for Ecsponent are linked to the prospects of the investee companies, details of which are set out below. Over the past two years, the Group has taken several strategic steps that the Directors believe have improved the future prospects of the Group. A description of the subsidiaries, as well as the Acquisitions follow: 57

Financial Services Ecsponent Financial Services 1.10 Ecsponent Financial Services was incorporated as a private company on 24 April 2006 under the name Tiespro 69 (Pty) Ltd, registration number 2006/012668/07 and has been in operation for 8 years. The name was changed to Escalator Financial Services on 22 November 2011. The name was thereafter changed to Ecsponent Financial Services on 28 January 2014. 1.11 Ecsponent Financial Services has 10 000 000 ordinary shares of R0.00001 each in issue, of which Ecsponent holds 100%. Ecsponent Financial Services became a subsidiary of Ecsponent on 25 July 2014. Details of the acquisition can be obtained the Acquisition Circular, contained on the Issuer s website. 1.12 Ecsponent Financial Services is registered with the Financial Services Board ( FSB ) as a Financial Services Provider (licence number 32968) to provide intermediary services between product providers and the public in general. Ecsponent Financial Services main business is the provision of financial services and it has been appointed to act as intermediary between Ecsponent Capital and the public as a placement agent. 1.13 Ecsponent Financial Services recruits and manages qualified advisors under its FSB licence to market the products under the rules and regulations that are prescribed by the FSB. Advisors who are already registered with the FSB are also to be evaluated to market these products. 1.14 The Ecsponent financial services strategy requires access to and control of key elements of the channel to market. FSB regulatory licences are an important component of the roll out of the strategy and the acquisition of Ecsponent Financial Services provides Ecsponent with the required licences, skills and infrastructure. Directors view on prospects 1.15 The Ecsponent Financial Services network has in the past successfully marketed unlisted, prospectus based products. Ecsponent intends providing listed products and products with enhanced tradability which the directors believe will substantially improve the market acceptance of the product range. It is further the company s intention to expand the product range further bolstering the future prospects. 58

Sanceda Services 1.16 Ecsponent acquired the business of Sanceda (i.e. assets, leased assets, marks and goodwill) on 25 July 2014, which business has been in operation for 3 years and which will be conducted by Sanceda Services going forward, a wholly owned subsidiary of Ecsponent, established for the purpose of conducting the business of Sanceda. 1.17 Details of the acquisition can be obtained the Acquisition Circular, contained on the Issuer s website. 1.18 Sanceda Services has 1 000 no par value ordinary shares in issue, of which Ecsponent holds 100%. Sanceda Services has been a subsidiary of Ecsponent since incorporation on 24 October 2011. 1.19 Sanceda Services is a collections agency registered with the National Credit Regulator, which provides for collections on behalf of companies. Collections are call centre based and Sanceda Services has established the management and infrastructure to collect on a large volume of files concurrently. 1.20 Sanceda Services collections expertise includes tracing of defaulters, repayment and contract agreement, debit order and related collection management and legal pursuance of defaulters should this become necessary. 1.21 Sanceda Services currently manages a distressed debt portfolio of around R700 million. The bulk of the portfolio is debt books owned by Escalator Capital Asset Management Proprietary Limited, which company is owned by Ecsponent Capital. 1.22 The Ecsponent financial services strategy includes the acquisition of debt books and the realisation of value through the efficient collection of the debt. The Sanceda Acquisition provides Sanceda Services with the skills and infrastructure to collect against its own debt books. In addition the debt crisis in South Africa creates the opportunity to expand the collections of third party debt. Directors view on prospects 1.23 The systems infrastructure of Sanceda Services is currently completing a major upgrade which includes a sophisticated analytics platform and predictive dialling facilities. These improvements are anticipated to double the throughput of the call centre and substantially improve efficiency of the operator. 1.24 Ecsponent intends to utilise certain funds from the Right Offer to acquire additional distressed debt portfolios improving the throughput and profitability of the company. 59

Botswana Ecsponent Botswana 1.25 Ecsponent Botswana was incorporated as a private company on 24 August 2010 under the name Loyn (Proprietary) Limited and has been in operation for 1 year. On 26 April 2011, Ecsponent Botswana s name was changed to Escalator Investment Holdings (Pty) Limited. On 12 October 2012 Ecsponent Botswana passed a special resolution to convert to a public company, which conversion was completed and registered on 21 November 2012, on which date Ecsponent Botswana s name was changed to Escalator Investment Holdings Limited. On 17 February 2014, Ecsponent Botswana s name was changed to Ecsponent Limited. 1.26 Ecsponent Botswana has 1 000 ordinary shares of R1 each in issue, of which Ecsponent holds 100%. Ecsponent Botswana became a subsidiary of Ecsponent on 25 July 2014. Details of the acquisition can be obtained the Acquisition Circular, contained on the Issuer s website. 1.27 Ecsponent Botswana is a financial services company which raises capital through the issuance of various classes of preference shares. Subscription is by means of a prospectus issued to qualifying members of the public and institutions. 1.28 Ecsponent Botswana provides funding to selected financial services companies whilst also providing secured credit to small, medium and micro enterprises (SMMEs). 1.29 Ecsponent Botswana is anticipated to provide high growth and high net returns to stakeholders. The acquisition of the company at a start-up phase provides the opportunity for high returns whilst also providing a channel to market for Ecsponent products and services into Africa. Directors view on prospects 1.30 The directors anticipate substantial organic growth in respect of the existing business model. In addition the company s research has identified opportunities in lucrative niche SMME markets. It is the company s intention to leverage its vendor finance products to maximise these opportunities. 60

Cryo-Save SA 1.31 Experite NV and Ecsponent have successfully established a joint venture which provides for the harvesting and banking of stem cells from both cord blood as well as cord tissue. 1.32 Experite NV s Cryo-Save operation ( Cryo-Save ) is the leading international family stem cell bank and already stores over 250 000 samples from cord blood and umbilical cord tissue for new-borns and adipose tissue for adults. There are already several diseases that can be cured by the use of stem cells, and the Directors believe the number of treatments will only increase. Driven by its international business strategy, Cryo-Save is now represented in 40 countries on three continents, with ultra-modern processing and storage facilities in Belgium, Germany, Dubai, India and France 1.33 Cryo-Save SA combines Cryo-Save s leading expertise in stem cell processing and storage with Ecsponent s local and African market expertise and offers customers the option of storing cord tissue and stem cells from cord blood in South Africa or off shore in Belgium. 1.34 Cryo-Save SA has 200 no par value ordinary shares in issue, of which Ecsponent holds 50%. Cryo-Save SA became a subsidiary of Ecsponent on 1 July 2011. Directors view on prospects 1.35 Cryo-Save SA continued to set new records during the 2013 financial year, signing up 1 492 new clients (R20.2 million) during the 12 months ended 31 December 2013. This compares to R18.5 million for the previous 15 month period. The growth of the company has resulted in a new state of the art laboratory being commissioned in Pretoria in January 2013. The company entrenched its leadership in the field of umbilical cord stem cell technology by launching a nationwide educational campaign which was extremely well received by the medical fraternity. Cryo-Save also became the first laboratory in Africa to provide authenticated viability testing on cord tissue prior to cryogenic storage. 1.36 The company absorbed the costs associated with the move of the laboratory and rode the rollercoaster of currency deterioration during the past year positioning the business for aggressive growth in the future. 1.37 In the director s view, the acceptance of the technology by leading medical aids will dramatically increase the education and exposure of the business to the target market. 61

Salveo 1.38 Salveo established its leadership in its field as the first company to store cord blood stem cells in South Africa and has been operating for 9 years. The company was founded in 2005 after the development of its technology at the Stellenbosch University by well-known stem cell researcher, Dr Daniel Barry, and his research team. 1.39 Salveo has 369 970 339 no par value ordinary shares in issue, of which Ecsponent holds 50%. Salveo initially became a subsidiary of Ecsponent on 24 February 2004, after which Ecsponent reduced its equity stake to 24% in 2010. In March 2012 Ecsponent re-acquired 26% shares from minority shareholders. 1.40 The main aim and focus is to develop stem cell-related biotechnologies in South Africa, by leveraging health enhancing knowledge and products into society through careful and ethical use of adult stem cells. This is done through collaboration with international consortiums, such as the Asian Pacific Cord Blood Bank Consortium, and overseas collaboration with leading individuals and companies. Directors view on prospects 1.41 Post the period under review, Salveo entered into a collaborative venture with Experite N.V and Salveo Biotechnology of Switzerland for the rights to the Salveo Biotechnologies Products and Services in Southern Africa. 1.42 The acquisition provides the Group with a second stem cell harvesting and storage business to further entrench its dominance in the field of family stem cell banking. The nature of the Swiss protocols and technology reduces the costs associated with the processing and storage of the umbilical stem cells resulting in a saving to the client. The development allows the Group to target both the high end (Cryo-Save) and lower end (Salveo) of the stem cell market whilst providing industry leading European backed products and services. 62

Credit Services Ecsponent CS 1.43 Ecsponent CS has 100 no par value ordinary shares in issue. Ecsponent CS became a subsidiary of Ecsponent on 1 July 2011, after the acquisition by Ecsponent of 100% of the shares in, and claims against, Ecsponent CS for a cash consideration of R100. 1.44 Ecsponent CS is a micro finance organisation providing financial services to third party company employees and has been in operations for 4 years. Ecsponent CS was the first acquisition by Ecsponent in its new Financial Services Division. Ecsponent CS core business remains unsecured micro finance, however it has diversified its operations and acquired a loan book for a consideration of 10% of the projected future collectable amounts. The company expanded further by and entering the SME market, granting secured loans to medium size growth organisations. Directors view on prospects 1.45 Ecsponent CS has shown strong growth since its incorporation. The company currently has agreements with six companies with a combined staffing of 10 000 employees. Ecsponent CS has over 200 clients and a loan book of R2.6 million. 1.46 Post the period Ecsponent CS has increased its payroll unsecured credit operations to just short of R40 million and the combined employee base to over 70 000 as a result of the Groups on going acquisition strategy. 1.47 The potential of the Ecsponent CS client base is largely under exploited and the Group intends to facilitate further strong growth through the provision of increased funding. 1.48 Ecsponent CS intends to also deploy funds to develop the lucrative vendor finance and SME markets. The robust business model which the Group has fully tested mitigates the risks associated with these sectors of the market whilst the small overhead base provides for maximised returns. 63

Vinguard 1.49 Vinguard is a public company and has been in operation for 12 years. Vinguard initially became a subsidiary of Ecsponent on 29 October 2002 when Ecsponent acquired 75.87% of the issued ordinary shares of Vinguard. Vinguard become a wholly owned subsidiary of Ecsponent in July 2015 following an offer by Ecsponent to acquire all the ordinary shares not already held by it. 1.50 Vinguard currently operates as a management service entity which performs internal services to the Group. Vinguard also continues to collect on a debtors book that was acquired by it in 2013. Directors view on prospects 1.51 The directors decided to dispose of the unprofitable Dual Release S0 2 gas sheet manufacturing assets resulting in a section 112 disposal, for a consideration of R5 million, which was approved by Vingaurd shareholders on 24 January 2014. The Vinguard business will retain currently profitable assets and may acquire aligned businesses in the future. 1.52 The company s remaining assets perform well providing a profitable return and the directors continue to evaluate aligned business opportunities to provide further growth for the company. Other material changes 1.53 The primary impediment to the group s growth to date has been the provision and cost of finance. Corporate actions undertaken during the year included the R100 million Rights Offer and the acquisition of a number of potentially cash generative operations as well as the preference share structure contemplated in this Programme Memorandum substantially addresses the limitation. 1.54 The development of current subsidiaries as well as on going product and market extension, the development of the acquisitions already announced and aggressive trading positions the Group to effectively leverage funding provided. This is further exploited through the development of new markets for the subsidiaries leveraging of new opportunities. 1.55 Initiatives are on-going and are aimed at possible further acquisitions with the specific intention of broadening the Group s interests within the core focus area of a financial services holding company. As part of the Group s business model, expansions into various other geographies have been earmarked and are at various stages of evaluation or approval. These areas include Namibia, Malawi, Kenya, Tanzania, Uganda, Mozambique and Zimbabwe. 1.56 The Board has recently undergone a rebranding exercise to emphasise the new synergies and energy within the Group and its restructured focus as a financial services investment holding company. 64

Overview of the board 1.57 The Ecsponent Board is currently made up of two executive directors and four non-executive directors, of whom the majority are independent. The names, ages, nationalities, business addresses, qualifications and capacities of the directors and prescribed officers of Ecsponent are set out below: Name, age and occupation Business address Brief Profile RJ Connellan (70) Independent Non-Executive Chairman KA Rayner (58) Independent Non-Executive 2 Larnica Villas 251 Willson Street Fairland Johannesburg 2195 6 Carmel Place 53 Melrose Street Melrose Estate Johannesburg, 2196 Richard is a Fellow of the Institute of Chartered Secretaries & Administrators, a non-broking member of the South African Institute of Stockbrokers, a member of the King III Committee on Corporate Governance (chairman of the takeovers and mergers subcommittee) and until May 2011 a member of the Standing Advisory Committee on Company Law. Mr Connellan previously worked as assistant manager of Listings at the JSE, as head of corporate finance at Kaplan & Stewart Inc. Stockbrokers, as general manager of the Listings and Equity and Gilt Markets Division of the JSE and had retired as Executive Director of the Securities Regulation Panel in 2010 (now the TRP) which position he held since 1994. Keith is a South African chartered accountant with a wealth of experience in corporate finance, having started his corporate finance career in 1987. Over the years, he has advised numerous listed companies on most types of corporate finance transactions, and through KAR Presentations, currently advises certain client on a selective basis. He is CEO of KAR Presentations, an advisory and presentation corporation, which specialises in corporate finance and regulatory advice and presentations. He is, inter alia, a director on the boards of two other JSE listed company, being Goliath Gold Mining Ltd and White Water Resources Ltd (both as an independent nonexecutive director). Keith is a member of the JSE Issuer Services Advisory Committee and has been actively involved in assisting the JSE Issuer Services Division since 1995 including the rewrite of the JSE Listings Requirements in both 2000 and 2003. He assisted in drafting the TRP regulations for the new Companies Act, 2008. He was a member of the King III subcommittee which wrote the governance principles for takeovers and mergers in 2009. He is a fellow of the Institute of Directors in South Africa, is a non-broking member of the Institute of Stockbrokers in South Africa, is a member of the Investment Analysts Society, is a member of the SAMREC / SAMVAL working group, is a member of the Institute of Directors Code for Responsible Investing in South Africa (CRISA) committee and is a past member of the Accounting Practices Committee. 65

Name, age and occupation Business address Brief Profile BR Topham (43) Independent Non-Executive TP Gregory (55) Chief Operating Officer 100A Club Avenue, Waterkloof Ridge Pretoria 0181 Acacia House Green Hill Village Office Park Cnr of Nentabos and Botterklapper Street The Willows Pretoria East, 0181 Brandon is a qualified Chartered Accountant and Attorney of the High Court of South Africa. He holds B Compt (Hons), BProc and LLM degrees. Other qualifications include an Advanced Certificate in Taxation and completion of the Alt-X Directors Programme. He is a member of the Institute of Directors and is an Associate Member of both the Institute of Chartered Management Accountants (UK) and of the Institute of Chartered Accountants in England & Wales (nonpracticing). He is also an admitted Solicitor in England and Wales and a Certified Fraud Examiner (USA). He completed his articles with BDO and was employed as a manager with Deloitte & Touche Forensic Services after completing his legal articles. He has practiced as a professional business advisor since 1998. Brandon has served as a Director of 1Time Holdings Ltd, Breform Ltd Professional Provident Society Holdings Ltd and Girls Best Friend (Pty) Ltd and continues to serve on the boards of TeleMasters Holdings Ltd, Seesa (Pty) Ltd, and a few other smaller companies. As a forensic accountant he has acted as an Inspector for the Financial Services Board and has worked with other regulators and government departments as well as for numerous private companies and attorneys. He is actively involved in numerous community organisations and has a wide business knowledge which will add value to the management of the Company. Terence is an experienced business executive with over 30 years experience, with the past 18 years at board level. He has extensive exposure to corporate organisations including Imperial Holdings Ltd, Afgri Ltd and McCarthy Ltd and has also developed smaller, entrepreneurial companies. Terence is currently appointed to the board of numerous companies within the Group in a non-executive capacity Bryan Shanahan (30) Group Financial Director Acacia House Green Hill Village Office Park Cnr of Nentabos and Botterklapper Street The Willows Pretoria East, 0181 Bryan is a qualified Chartered Accountant with experience across a wide range of industries and organisations. He held an Audit Manager position at one of the big four international auditing firms and moved on to become part of the executive management team of a large manufacturing group operating in Africa, responsible for the group s financial processes, reporting and project financing reviews. Bryan currently acts as the group s Finance Manager. Bryan s experience includes financial statement audits and financial reporting for a wide range of entities, governance and control assessments, company turnaround projects, mergers and acquisitions, risk management and exposure to corporate finance disciplines. Bryan Shanahan has been appointed as the Group Financial Director with effect from 1 December 2015. 66

Name, age and occupation Business address Brief Profile E Engelbrecht (38) Chief Executive Officer Henk van der Merwe (47) (Timbavati Business Consultants (Pty) Ltd) Company Secretary Acacia House Green Hill Village Office Park Cnr of Nentabos and Botterklapper Street The Willows Pretoria East, 0181 Acacia House Green Hill Village Office Park Cnr of Nentabos and Botterklapper Street The Willows Pretoria East, 0181 Euné is a director of Ecsponent Capital, the controlling shareholder of Ecsponent. Euné was the head of Blue Financial Services Corporate Finance division and was involved in fund-raising at a corporate level heading up the corporate finance team tasked with securing continuous and affordable funding from global private equity funds, investment banks and development funding institutes. He was also responsible for acquisitions and expansion-related activities of the company. Henk van der Merwe is the Managing Executive of Timbavati Business Consultants. He is a Chartered Accountant who qualified in 1990. After completing his articles at PWC he started his Merchant Banking career. He worked for several merchant banks, both locally and abroad. He is a specialist in corporate finance transactions having been involved in the mergers and acquisitions, IPO and listing field for many years. He has advised various clients during the years on divestment and investment transactions. He further has extensive experience in the private equity field. Apart from his merchant banking career, he also worked as COO, CFO and CEO in the financial services and food industries for 6 years. 67

CORPORATE GOVERNANCE The Group endorses the principles contained in the King III report on corporate governance and confirms its commitment to the principles of fairness, accountability, responsibility and transparency as advocated therein. The board strives to ensure that the Group is ethically managed according to prudently determined risk parameters and in compliance with generally. Two major areas not adopted by Ecsponent include the establishment of an internal audit function and the fact that the chairman of the Board should not be a member of the audit committee. Shareholders have however approved the chairman being a member of the audit committee at the annual general meeting and the necessary disclosure in this regard was made in line with the JSE guidance. The full register, addressing all the principles of the King III Report and Code on Corporate Governance, is set out on the Company s website (http://jd-h.com), at the following links: King III Register http://www.iodsa-gai.co.za/reports/public/applicationregisterpractice.aspx?l=ba16f740-2d92-4241-b2d2- c631428074cb King III Application register http://www.iodsa-gai.co.za/reports/public/applicationregisterprinciple.aspx?l=ba16f740-2d92-4241-b2d2- c631428074cb JSE Corporate Governance Listing Requirement http://www.iodsa-gai.co.za/reports/public/jse_listingrequirements.aspx?l=ba16f740-2d92-4241-b2d2- c631428074cb As a result of the small size of the business and the low volume of transactions, managements focus has been on the design and implementation of controls and no internal audit function had been established. The Group s internal control environment is continually re-evaluated. Other principles have been partially adopted, or are in the process of being adopted are set out in the tables below: 68

Principles not applied Chapter Principle Principle Description Practice Reason / Explanation Chapter 2 Principle 2.16 The Board has elected a chairman of the board who is an independent non-executive director. The CEO of the company does not also fulfil the role of chairman of the Board. The chairperson is elected by board members every year. The chairman is an independent non-executive director. The chairman is only reviewed when the board deems it necessary. Principle 2.22 The evaluation of the Board, its committees and individual directors is performed every year. An overview of the appraisal process of the board, board committees, individual directors, the results thereof and action plans are disclosed in the integrated report. Will be applied going forward Principle 2.25 The company remunerates its directors and executives fairly. Employment contracts do not commit the company to pay on termination arising from an executive s failure. The contracts are silent regarding the payment on termination in the case of an executive s failure. Principle 2.25 The company remunerates its directors and executives fairly. The company has established share-based and/or long-term incentive schemes. The board is evaluating share based and other long term incentive scheme aimed at aligning all staff to the objectives of the Group and appropriately rewarding staff on achievement of Group objectives. No incentive scheme is currently in place. Principle 2.25 The company remunerates its directors and executives fairly. Non-executive fees comprise a base fee and attendance fee per meeting. The board is evaluating share based and other long term incentive scheme aimed at aligning all staff to the objectives of the Group and appropriately rewarding staff on achievement of Group objectives. A share incentive scheme has been put in place, however no shares or share options have been issued under the scheme to date. Chapter 3 Principle 3.2.3 The chairman of the board should not be the chairman or member of the audit committee The audit committee is elected each year by the shareholders All members of the audit committee should be independent non-executive directors. The audit committee should consist of at least three members. The company only has three independent nonexecutive directors, the chairman being one. As a result, the chairman sits on the audit committee, but only as a member. Principle 3.4 The audit committee oversees integrated reporting The audit committee recommends to the board the whether to engage an external assurance provider on material sustainability issues. The board is currently of the view that external assurance on material sustainability issues does not add significant value to the integrated report but will review this position going forward. 69

Chapter Principle Principle Description Practice Reason / Explanation Chapter 4 Principle 4.2 The Board has determined the levels of risk tolerance The board sets the levels of risk tolerance every year. Risk levels have been set and are reviewed as and when the board deems it necessary. Chapter 5 Principle 5.1 The Board is responsible of information technology (IT) governance. The board receives independent assurance on the effectiveness of the IT internal controls. The board is currently of the view that external assurance on the effectiveness of the IT internal control does not add significant value to the integrated report but will review this position going forward. Principle 5.6 The Board ensured that information assets are managed effectively. The board ensures that an Information Security Management System is developed, implemented and recorded that ensures security (confidentiality, integrity and availability of information). The information system is currently being evaluated Chapter 6 Principle 6.1 The Board ensures that the company complies with applicable laws and considers adherence to non binding rules, codes and standards. The extent of adherence to applicable non-binding rules, codes and standards is disclosed in the integrated report. Although the company adheres to applicable rules, codes and standards the extent of adherence to nonbinding rules, codes and standards have not been quantified and disclosed Principle 6.4 The Board should delegate to management the implementation of an effective compliance framework and processes. The CEO has appointed an individual responsible for the management of compliance; e.g.. a Chief Compliance Officer. Due to limited resources, this position has not yet been filled. It makes use of an outsourced compliance function. Principle 6.4 The Board should delegate to management the implementation of an effective compliance framework and processes. The individual responsible for compliance is a suitably skilled and experienced person who has access to and interacts regularly on strategic compliance matters with the board and/or appropriate board committee and executive management. Due to limited resources, this position has not yet been filled. It makes use of an outsourced compliance function. Principle 6.4 The Board should delegate to management the implementation of an effective compliance framework and processes. The compliance function has adequate resources to fulfil its duties. Due to limited resources, this function has not yet been filled. Principle 6.4 The Board should delegate to management the implementation of an effective compliance framework and processes. The board ensures that a legal compliance policy, approved by the board, has been implemented by management. Due to limited resources, this policy has not yet been implemented. 70

Chapter Principle Principle Description Practice Reason / Explanation Principle 6.4 The Board should delegate to management the implementation of an effective compliance framework and processes. The board receives assurance on the effectiveness of the controls around compliance with laws, rules, codes and standards. Due to limited resources, no assurance on the effectiveness of the controls around compliance with laws, rules, codes and standards has been sought. Principle 6.4 The Board should delegate to management the implementation of an effective compliance framework and processes. Compliance with laws, rules, codes and standards is incorporated in the code of conduct of the company. No code of conduct has been drawn up by the company. This will be done in due course. Chapter 7 Principle 7.1 The Board should ensure that there is an effective risk based internal audit. The company has established an internal audit function. Due to the size of the organisation, the establishment of a separate internal audit function is not justified. Chapter 8 Principle 8.1 The Board should appreciate that stakeholders perceptions affect a company s reputation. The company s reputation and its linkage with stakeholder relationships is a regular board agenda item. This is only dealt with at board meetings when deemed necessary. Principle 8.1 The Board should appreciate that stakeholder; perceptions affect a company s reputation. Stakeholders which could materially affect the operations of the company are identified, assessed and dealt with as part of the risk management process. Stakeholders has not been formally identified and assessed. This will be addressed in due course. Principle 8.2 The Board should delegate to management to proactively deal with stakeholder relationships. Management develops a strategy and formulates policies for the management of relationships with each stakeholder grouping. No formal strategy and policies has been developed to date. This will be addressed in due course. Principle 8.2 The Board should delegate to management to proactively deal with stakeholder relationships. The board oversees the establishment of mechanisms and processes that support stakeholders in constructive engagement with the company. No formal mechanisms and processes have been developed to date. This will be addressed in due course. Principle 8.5 Transparent and effective communication with stakeholders is essential for building and maintaining their trust and confidence. The board has adopted communication guidelines that support a responsible communication programme. No formal communication guidelines have been developed to date. This will be addressed in due course. Principle 8.6 The Board should ensure that disputes are resolved effectively and expeditiously as possible. The board has adopted formal dispute resolution processes for internal and external disputes. No formal dispute resolution processes have been developed to date. This will be addressed in due course. Chapter 9 Principle 9.3 Sustainability reporting and disclosure should be independently assured. Sustainability reporting is independently assured. The board is currently of the view that external assurance of the sustainable report does not add significant value to the integrated report but will review this position going forward. 71

Principles partially applied Chapter Principle Principle Description Practice Reason / Explanation Chapter 1 Principle 1.2 The Board ensures that the company is and is seen to be a responsible corporate citizen The board ensures that measurable corporate citizenship programmes and policies are developed and implemented. The initial focus of the board has been on ensuring the Group s return to profitability and its future sustainability. The board has not developed formal measurable corporate citizen programmes and policies as yet. Principle 1.3 The Board ensures that the company ethics are managed effectively The board ensures that ethical risks and opportunities are incorporated in the risk management process or ethics programme; i.e. and ethics risk and opportunity profile is compiled. The board assesses ethical risks and opportunities throughout the diverse businesses of the Group. A formal ethics risk and opportunity profile has not been established as yet. Principle 1.3 The Board ensures that the company ethics are managed effectively The board ensures that the company s ethics performance is assessed, monitored, reported and disclosed. The initial focus of the board has been on ensuring the Group s return to profitability and its future sustainability which incorporated the need to consider and ensure ethical behaviour is entrenched throughout the organisation. Formal measures to monitor and report ethic performance is not in place. Principle 1.3 The Board ensures that the company ethics are managed effectively The board has ensured that a code of conduct and ethics-related policies, through which ethical standards are clearly articulated, have been established and implemented. The initial focus of the board has been on ensuring the Group s return to profitability and its future sustainability which incorporated the need to consider and ensure ethical behaviour is entrenched throughout the organisation. Formal ethic codes and standards have not been set as yet. Principle 1.3 The Board ensures that the company ethics are managed effectively The board ensures compliance with the code of conduct is integrated into the strategy and operations of the company; i.e. the ethical organisational culture is reflected in the company s vision and mission; strategies and operations; its decisions and conduct; and the manner in which it treats its internal and external stakeholders. The initial focus of the board has been on ensuring the Group s return to profitability and its future sustainability which incorporated the need to consider and ensure ethical behaviour is entrenched throughout the organisation. Chapter 2 Principle 2.2 The Boards appreciates that the strategy, risk, performance and sustainability are inseparable Board takes steps to ensure that long-term planning will result in sustainable outcomes taking account of people, planet, profit. The Board has focused on strategies, short and long term planning with the objective of returning the operations of the Group to profitability in the short term with subsequent continued revenue and earnings growth. 72

Chapter Principle Principle Description Practice Reason / Explanation Principle 2.16 The Board has elected a chairman of the board who is an independent non-executive director. The CEO of the company does not also fulfil the role of chairman of the Board. There is succession planning in place for the chairperson. Should the current chairman no longer be available the board constitution will be re-considered. The appropriate number of non-executive directors appointed and a new chairman will be elected from the appointed independent non-executive directors. Principle 2.17 The Board has appointed the Chief Executive Officer and has established a framework for the delegation of authority The board has input in other senior executive appointments. The executive directors interview and appoint senior management. Principle 2.17 The Board has appointed the Chief Executive Officer and has established a framework for the delegation of authority The role and function of the CEO is formalised. Although not formally documented the CEO s role is clearly defined. Principle 2.17 The Board has appointed the Chief Executive Officer and has established a framework for the delegation of authority There is a formal succession plan in place for the CEO and other senior executives. Due to limited resources and the stage of development of the company, no formal succession plan is in place. Chapter 3 Principle 3.2 Audit committee members are suitably skilled and experienced independent non-executive directors The audit committee includes in the integrated report both the following: No internal audit function thus no comment iro the requirements listed in section. - a statement on whether or not it considered and recommended the internal audit charter for approval by the board; and - a description of its working relationship with the Chief Audit Executive. Principle 3.7 The audit committee should be responsible for overseeing internal audit The internal audit plan is approved by the audit committee. Due to the relative limited size of the business an internal audit function has not been established. Should management require assurance expert contractors are appointed. Principle 3.7 The audit committee should be responsible for overseeing internal audit The audit committee ensures that the company s internal audit function is independent and has the necessary resources, standing and authority within the company to enable it to discharge its functions. Due to the relative limited size of the business an internal audit function has not been established. Should management require assurance expert contractors are appointed. Principle 3.7 The audit committee should be responsible for overseeing internal audit The audit committee oversees cooperation between external and internal audit to avoid overlapping of audit scope. Due to the relative limited size of the business an internal audit function has not been established. Should management require assurance expert contractors are appointed. 73

Chapter Principle Principle Description Practice Reason / Explanation Principle 3.7 The audit committee should be responsible for overseeing internal audit The audit committee ensures that the internal audit function is subjected to an independent quality review as and when it determines it appropriate. Due to the relative limited size of the business an internal audit function has not been established. Should management require assurance expert contractors are appointed. Principle 3.8 The audit committee is an integral component of the risk management process. There is a statement from the board in the integrated report on the effectiveness of internal financial controls based on a formal documented review thereof. The audit committee makes a statement on the effectiveness of the system on internal controls. The statement is not based on a formal documented review by internal audit. High level informal input is obtained from the external auditors. Chapter 4 Principle 4.1 The Board is responsible for the governance of risk. The risk plan includes: the company s risk management structure; the risk management framework - i.e. the approach followed for instance COSO, ISO, IRMSA ERM Code of Practice, IRM (UK), etc; the standards and methodology adopted - this refers to the measureable milestones such tolerances, intervals, frequencies, frequency rates, etc; risk management guidelines; reference to integration through for instance training and awareness programmes; and details of the assurance and review of the risk management process. Risk management systems and processes are manual and dependent on key management. The business operations are still relatively small enabling the management team with board support to effectively manage risks. Principle 4.4 The Board has delegated to management the responsibility to design, implement and monitor the risk management plan. The Chief Risk Officer (CRO) or other senior employee responsible for risk management is a suitably experienced person who has access to and interacts regularly on strategic matters with the board and/or appropriate board committee and executive management. Risk management systems and processes are manual and dependent on key management and not allocated to a CRO. The business operations are still relatively small enabling the management team with board support to effectively manage risks. Principle 4.6 The Board has ensured that frameworks and methodologies are implemented to increase the probability of anticipating unpredictable risks. The board ensures that a framework and processes are in place to (remove) anticipate unpredictable risks. Risk management systems and processes are manual and dependent on key management. The business operations are still relatively small enabling the management team with board support to effectively manage risks. Principle 4.8 The Board has ensured the continual risk monitoring by management. The board ensures that effective and continuous monitoring of risk management takes place. Risk management systems and processes are manual and dependent on key management. The business operations are still relatively small enabling the management team with board support to effectively manage risks. 74

Chapter Principle Principle Description Practice Reason / Explanation Principle 4.9 The Board has received assurance regarding the effectiveness of the risk management process. Management provides assurance to the board that the risk management plan is integrated in the daily activities of the company. Risk management systems and processes are manual and dependent on key management. The business operations are still relatively small enabling the management team with board support to effectively manage risks. Chapter 5 Principle 5.1 The Board is responsible of information technology (IT) governance. The board assumes the responsibility for the governance of IT and place it on the board agenda. The board assumes responsibility for the governance of IT but it is not a board agenda matter unless identified as such due to changes in the IT risk profile of the operations. Principle 5.1 The Board is responsible of information technology (IT) governance. There is an IT governance framework that supports effective and efficient management of IT resources to facilitate the achievement of the company s strategic objectives. The organisation is in the process of implementing principles of the COBIT framework where relevant and appropriate to govern IT. Principle 5.2 IT has been aligned with the performance and sustainability objectives of the company. The board ensures that IT strategy is integrated with the company s strategic and business processes. The organisation is in the process of implementing principles of the COBIT framework which incorporates the strategic alignment of business and IT objectives. Operational and business strategy drives the current IT strategy. Operational reporting structures ensure that IT management are accountable to business management. Principle 5.3 The Board has delegated to management the responsibility for the implementation of an IT governance framework. The individual responsible for IT is a suitably qualified and experienced person who has access and interacts regularly on IT governance matters with the board and /or appropriate board committee and executive management. The size of the organisation does not warrant the appointment of a CIO Chapter 9 Principle 9.2 Sustainability reporting and disclosure should be integrated with the company s financial reporting. The board ensures that the positive and negative Will be implemented in due course. impacts of the company s operations and the plans to improve the positives and eradicate or ameliorate the negatives in the financial year ahead are conveyed in the integrated report. Principle 9.3 Sustainability reporting and disclosure should be independently assured. The scope of independent assurance over sustainability report is disclosed in the integrated report. The board has not obtained independent assurance regarding the sustainability report, thus no comment in this regard by the audit committee. 75

SETTLEMENT, CLEARING AND TRANSFERS Words used in this section headed Settlement, Clearing and Transfers shall bear the same meanings as used in the section headed Definitions and Interpretations and as defined elsewhere in this Programme Memorandum, except to the extent that they are separately defined in this section or the context otherwise requires. 1. Preference Shares listed on the Main Board of the JSE and/or held in Strate Each Tranche of Preference Shares which is listed on the Main Board of the JSE in dematerialised form will be held in Strate. A Tranche of unlisted Preference Shares may also be held in Strate. 2. Clearing Systems Each Tranche of Preference Shares which is listed on the JSE and issued in dematerialised form will be cleared through Strate which, as the operator of an electronic Clearing System, has been appointed by the JSE to match, clear and facilitate the settlement of transactions concluded on the JSE. Each such Tranche of Preference Shares will be issued, cleared and transferred in accordance with the Applicable Procedures and the Terms and Conditions. Each such Tranche of Preference Shares will be settled through Participants who will comply with the electronic settlement procedures prescribed by the JSE and Strate. The Preference Shares may be accepted for clearance through any additional Clearing System as may be agreed between the JSE, the Issuer and the Dealer(s). 3. Participants Strate maintains accounts only for Participants. As at the Programme Date, the Participants which are approved by the JSE, in terms of the debt listing requirements of the JSE, to perform electronic settlement of funds and scrip are Citibank N.A., Johannesburg Branch, FirstRand Bank Limited (RMB Custody and Trustee Services), Nedbank Limited, The Standard Bank of South Africa Limited, Standard Chartered Bank, Johannesburg Branch, Société Générale, Johannesburg Branch and the South African Reserve Bank. 4. Settlement and clearing Participants will be responsible for the settlement of scrip and payment transfers through Strate, the JSE and the South African Reserve Bank. While a Tranche of Preference Shares is held in Strate, Participants, or their nominees, will be named in the Register as the sole Preference Shareholder of the Preference Shares in that Tranche. All amounts to be paid and all rights to be exercised in respect of Preference Shares held in Strate will be paid to and may be exercised only by Participants, or their nominees, for the holders of Beneficial Interests in such Preference Shares. In relation to each Person shown in the records of Strate or the relevant Participant, as the case may be, as the holder of a Beneficial Interest in a particular nominal amount of Preference Shares, a certificate or other document issued by Strate or the relevant Participant, as the case may be, as to the nominal amount of such Preference Shares standing to the account of such Person shall be prima facie proof of such Beneficial Interest. 76

Payments of all amounts in respect of a Tranche of Preference Shares which is listed on the Main Board of the JSE and/or held in dematerialised form will be made to Participants, or their nominees, as the registered Preference Shareholder of such Preference Shares, which in turn will transfer such funds to the holders of Beneficial Interests. Each of the Persons reflected in the records of Strate or the relevant Participant, as the case may be, as the holders of Beneficial Interests in Preference Shares shall look solely to Strate or the relevant Participant, as the case may be, for such Person s share of each payment so made by (or on behalf of) the Issuer Participants, or their nominees. 5. Transfers and exchanges Subject to the Applicable Laws, title to Beneficial Interest held by clients of Participants indirectly through such Participants will be freely transferable and will pass on transfer thereof by electronic book entry in the Preference Shares accounts maintained by such Participants for such clients. Subject to the Applicable Laws, title to Beneficial Interests held by Participants directly through Strate will be freely transferable and will pass on transfer thereof by electronic book entry in the central Preference Shares accounts maintained by Strate for such Participants. Beneficial Interests may be transferred only in accordance with the Applicable Procedures. Beneficial Interests may be exchanged for Preference Shares represented by Individual Certificates in accordance with Condition 14.2 (Transfer of Preference Shares represented by Individual Certificates). 6. Records of payments, trust and voting Neither the Issuer nor the Paying Agent will have any responsibility or liability for any aspect of the records relating to, or payments made on account of, Beneficial Interests, or for maintaining, supervising or reviewing any records relating to Beneficial Interests. Neither the Issuer nor the Paying Agent nor the Transfer Secretaries will be bound to record any trust in the Register or to take notice of or to accede to the execution of any trust (express, implied or constructive) to which any Preference Share may be subject. Holders of Beneficial Interests vote in accordance with the Applicable Procedures. 77

SOUTH AFRICAN TAXATION Words used in this section headed South African Taxation shall bear the same meanings as used in the section headed Definitions and Interpretations and as defined elsewhere in this Programme Memorandum, except to the extent that they are separately defined in this section or the context otherwise requires. The comments below are intended as a general guide to the relevant tax laws of South Africa as at the date of the Programme Memorandum. The contents of this section headed South African Taxation do not constitute tax advice and do not purport to describe all of the considerations that may be relevant to a prospective subscriber for or purchaser of any Preference Shares. Prospective subscribers for or purchasers of any Preference Shares should consult their professional advisers in this regard. The Issuer is not obliged to gross-up any dividends payable in order to compensate investors for tax withheld. Income Tax Act, 58 of 1962 ( Income Tax Act ) Dividend withholding tax Dividends are defined as any amount transferred or applied by a company that is a resident for the benefit or on behalf of any person in respect of any share in that company, whether that amount is transferred or applied: a) by way of a distribution made by; or b) as consideration for the acquisition of any share in, that company, but does not include any amount so transferred or applied to the extent that the amount so transferred or appliedi. results in a reduction of contributed tax capital of the company; ii. constitutes shares in the company; or iii. constitutes an acquisition by the company of its own securities by way of a general repurchase of securities Dividends received by resident and non-resident persons are subject to a dividend withholding tax at a current rate of 15% ( Dividend Tax ). Non-residents who reside in areas which are the subject of Double Tax Agreements ( DTA ) between SARS and the said area may be subject to a reduced Dividend Tax Rate. The Issuer is obliged to withhold the applicable Dividend Tax from the dividends declared, unless the Issuer received confirmation, (see Annexure 1 for confirmation form to be completed), that the beneficial owner of that dividend is exempt from dividend tax, or to withhold dividend tax at a reduced DT rate in terms of section 64F of the Income Tax Act, and a written undertaking to inform the Issuer should the beneficial owner not qualify for the exemptions listed in section 64F of the Income Tax Act or cease to be the beneficial owner. The applicable forms to confirmation the tax status of investors in line with S64F can be obtained from the investors relevant CSDP or broker, an example of which is attached as Annexure 1 of this Programme Memorandum. 78

Class A Preference Shares and Class C Preference Shares and Class G Preference Shares Subject to exemptions and reductions, both residents and non-residents (in the absence of a DTA agreement) will be subject to Dividend Tax at 15% on the monthly dividends declared on Class A Preference Shares, Class C Preference Shares and Class G Preference Shares. Dividends Tax will be withheld and paid over to SARS before payment is made to the Preference Shareholder. Redemption Amounts which constitutes Contributed Tax Capital ( CTC ) will not constitute a dividend and will accordingly not attract Dividends Tax. Redemption Amounts that do not constitute CTC may be subject to Dividend Tax. Class B Preference Shares The premium due on Class C Preference Shares, i.e. 70% excess on Initial Issue Price, will constitute a dividend, and, subject to exemptions and reductions, will attract Dividend Tax. Dividends Tax will be withheld and paid over the SARS before payment is made to the Preference Shareholder. Redemption Amounts which constitutes Contributed Tax Capital ( CTC ) will not constitute a dividend and will accordingly not attract Dividends Tax. Redemption Amounts that do not constitute CTC may be subject to Dividend Tax. Income Tax Generally dividends are not subject to income tax in terms of section 10(1)(k) of the Income Tax Act. However, dividends may be subject to Income Tax where dividends are received by companies in respect of shares not owned by them, where dividends are received by companies on borrowed shares or if the dividends are re-characterised as income under section 8E ( Dividends on certain shares deemed to be interest in relation to the recipient thereof ) or section 8EA ( Dividends on third-party backed shares deemed to be income in relation to recipients thereof ) of the Income Tax Act (section 8E and section 8EA are described further below). Dividends subject to Income Tax will not be subject to Dividend Tax in terms of section 64F(1)(k) of the Income Tax Act. Section 8E: Dividends on certain shares deemed to be interest in relation to the recipient thereof In terms of section 8E, if a share qualifies as a hybrid equity instrument, dividends which accrue in respect of that share are regarded as income in the hands of the recipient and are taxable as such. Section 8E defines a hybrid equity instrument to include, inter alia, any share, other than an equity share, if the issuer of that share is obliged to redeem it within three years of its date of issue; or its holder has the option to have the share redeemed within three years of its date of issue. Other types of shares will be hybrid equity instruments if: a) (i) the issuer of that share is obliged to redeem it within three years of its date of issue; (iii) its holder has the option to have the share redeemed within three years of its date of issue; or (iv) at any time on the date of issue of that share, the existence of the company issuing that share A) is to be terminated within a period of three years; or B) is likely to be terminated within a period of three years upon a reasonable consideration of all the facts at that time; and 79

b) (v) (vi) they do not rank pari passu with other ordinary shares or with at least one class of other ordinary shares of the company, as regards the participation in dividends; or (ii) any dividends payable on such share are calculated directly or indirectly with reference to any specified rate of interest or the time value of money; and the issuer of that share is obliged to redeem it within three years of its date of issue, or (ii) its holder has the option to have the share redeemed within three years of its date of issue or (iii) the existence of the issuer is likely to be terminated within three years; or As the Preference Shares will be issued so as not to fall within the definition of hybrid equity instruments, dividends declared on the Preference Shares should not be regarded as income in terms of section 8E of the Income Tax Act. Section 8EA: Dividends on third-party backed shares deemed to be income in relation to recipients thereof In terms of section 8EA, if a share qualifies as a third party backed share, dividends which accrue in respect of that share are regarded as income in the hands of the recipient and are taxable as such. A third party backed share is defined to include any preference share in respect of which an enforcement right is exercisable by the holder of that preference share or an enforcement obligation is enforceable as a result of any amount of any specified dividend, foreign dividend, return of capital or foreign return of capital attributable to that share not being received by or accruing to any person entitled thereto. As the Preference Shares will not be guaranteed or otherwise secured, the provisions of section 8EA will not be applicable, and dividends will not be defined as income under section 8EA. Should the investments in Preference Shares be classified as income in nature (as is generally the case with share traders), gains and losses made on the disposal of Preference Shares will be subject to Income Tax at the investors applicable Income Tax rate. Capital Gains Tax ( CGT ) Should the investments in Preference Shares be classified as an investment of a capital nature, capital l gains and losses of residents of South Africa on the disposal of Preference Shares (other than on redemption) are subject to capital gains tax. Capital gains tax under the Eighth Schedule to the Income Tax Act will be levied in relation to Preference Shares disposed of by a person who is not a resident of South Africa if the Preference Shares disposed of are attributable to a permanent establishment in South Africa. Ecsponent is considered to be a permanently established in South Africa. Non-resident investors should consult their own professional advisers as to whether a disposal of Preference Shares will result in a liability to pay capital gains tax. 80

Securities Transfer Tax Act, no 25 of 2007 ( STT Act ) The STT Act imposes securities transfer tax ( STT ) on the transfer and on the redemption of the Preference Shares at a rate equal to, as at the Programme Date, 0.25%. In the case of a transfer of unlisted Preference Shares, STT will be calculated on the higher of the consideration payable for the Preference Shares and their market value. In the case of listed Preference Shares, the STT will be calculated on the consideration payable. If the transfer was effected by a Participant, as defined in the STT Act and no consideration was declared or the amount declared was less than the lowest price of the share, the amount will be calculated on the closing price of the security. Such STT in respect of (or applicable to) the transfer of Preference Shares will be for the account of the transferee. In the case of a redemption of the Preference Shares, STT will be payable on the market value of the Preference Shares before such redemption. Such STT (and any future duties and/or taxes that may be introduced) in respect of (or applicable to) the redemption of Preference Shares will be for the account of the Issuer, unless otherwise specified in the Applicable Pricing Supplement. No STT will become payable on the issue, or potential conversion, of the Preference Shares 81

EXCHANGE CONTROL Words used in this section headed Exchange Control shall bear the same meanings as used in the section headed Definitions and Interpretations and as defined elsewhere in this Programme Memorandum, except to the extent that they are separately defined in this section or the context otherwise requires. Non-South African Resident Preference Shareholders and Emigrants from the Common Monetary Area Dealings in the Preference Shares, the performance by the Issuer of its obligations under the Preference Shares may be subject to the Regulations. Blocked Rand Blocked Rand may be used for the subscription for or purchase of Preference Shares. Any amounts payable by the Issuer in respect of the Preference Shares subscribed for or purchased with Blocked Rand may not, in terms of the Regulations, be remitted out of South Africa or paid into any non-south African bank account. Emigrants from the Common Monetary Area Any individual Certificates issued to Preference Shareholders who are emigrants from the Common Monetary Area will be endorsed non-resident. Such restrictively endorsed individual Certificates will be deposited with the authorised dealer controlling such emigrant s blocked assets. In the event that a Beneficial Interest in Preference Shares is held by an emigrant from the Common Monetary Area through Strate and its relevant Participants, the Preference Shares account of such emigrant will be designated as non-resident account. The CSDP or broker through which the Preference Shares have been demateriliased is responsible for ensuring adherence to the Exchange Control Regulations. Any payments of dividends and/or Redemption Amounts due to an emigrant Preference Shareholder will be deposited into such emigrant s Blocked Rand account, as maintained by the authorised dealer controlling such emigrant s blocked assets. The amounts are not freely transferable from the Common Monetary Area and may only be dealt with in terms of the Exchange Control Regulations. Non-residents of the Common Monetary Area Any individual Certificates issued to Preference Shareholders who are not resident in the Common Monetary Area will be endorsed non-resident. In the event that a Beneficial Interest in Preference Shares is held by a non-resident of the Common Monetary Area through Strate and its relevant Participants, the Preference Shares account of such Preference Shareholder will be designated as a non-resident account. It will be incumbent on any such non-resident to instruct the non-resident s nominated authorised dealer in foreign exchange as to how any funds due to such non-resident in respect of Preference Shares are to be dealt with. Such funds may, in terms of the Exchange Control Regulations, be remitted abroad only if the relevant Preference Shares are acquired with foreign currency introduced into South Africa and provided that the relevant Certificate or Preference Shares account is designated non-resident. Blocked Rand means funds which may not be remitted out of South Africa or paid into a non-south African resident s bank account. The relevant legislation relating to Blocked Rand is the regulations promulgated under the Currency and Exchanges Act, 1933. Exchange Control approval Approval in terms of the Exchange Control Regulations is not required for the subscription or purchase by investors of Preference Shares. 82

SUBSCRIPTION AND SALE Words used in this section headed Subscription and Sale shall bear the same meanings as used in the section headed Definitions and Interpretations and as defined elsewhere in this Programme Memorandum, except to the extent that they are separately defined in this section or the context otherwise requires. Selling Restrictions Republic of South Africa Each subscriber for Preference Shares issued under the Programme will be deemed to have represented and agreed that it will not be subscribing for Preference Shares in contravention of the Companies Act, the Banks Act, 1990, the Exchange Control Regulations and/or any other applicable laws or regulations of South Africa in force from time to time. This Programme Memorandum constitutes a Memorandum and Preference Shares will be offered for subscription to the public. The Preference Shares and the distribution of this Programme Memorandum in jurisdictions other than South Africa may be restricted by law, and a failure to comply with any of those restrictions may constitute a violation of the securities laws of any such jurisdiction. In particular, this Programme Memorandum and the Preference Shares do not constitute an offer to issue or sell, or a solicitation of an offer to subscribe for or purchase, any securities in or from any jurisdiction in which such offer or solicitation would be unlawful, including, without limitation, in or from any Affected Jurisdiction. To the extent that this Programme Memorandum may be sent to any Affected Jurisdiction, it is provided for information purposes only. Persons in Affected Jurisdictions may not accept the offer to subscribe for Preference Shares. No person accepting the offer to subscribe for Preference Shares should use the mail of any such Affected Jurisdiction nor any other means, instrumentality or facility in such Affected Jurisdiction for any purpose, directly or indirectly, relating to the offer. Persons into whose possession this Programme Memorandum comes must inform themselves about and observe any such restrictions. Save as specifically set out herein, no actions have been taken that would permit a public offering of Preference Shares to occur outside South Africa. Prospective investors should not treat the contents of this Programme Memorandum as advice relating to legal, taxation, investment or any other matters and should consult their own professional advisers concerning the consequences of their acquiring, holding or disposing of Preference Shares. Prospective investors should inform themselves as to: the legal requirements within their own countries for the purchase, holding, transfer or disposal of Preference Shares; any foreign exchange restrictions applicable to the purchase, holding, transfer or disposal of Preference Shares which they might encounter; and the income and other tax consequences which may apply to them as a result of the purchase, holding, transfer or disposal of Preference Shares. Prospective investors must rely upon their own representatives, including their own legal advisers and accountants, and not those of the Company, as to legal, tax, investment or any other related matters concerning the Company and an investment therein. The information contained in this Memorandum constitutes factual information as contemplated in section 1(3)(a) of the South African Financial Advisory and Intermediary Services Act No. 37 of 2002 and should not be construed as an express or implied recommendation, guidance or proposal that any particular transaction in respect of the Preference Shares is appropriate to the particular investment objectives, financial situations or needs of a prospective investor. 83

United States of America ( USA, U.S or United States ) The Preference Shares have not been and will not be registered under the United States Securities Act, 1933, as amended (the US Securities Act ), or any other securities laws of any state of, or other jurisdiction in, the USA and may not be offered or sold within the United States or to, or for the account of, or benefit of, U.S. persons except in certain transactions exempt from the registration requirements of the US Securities Act. This Programme may not be distributed or forwarded in or into the USA. Terms used in this paragraph have the meanings given to them by Regulation S under the US Securities Act. Each subscriber for Preference Shares under this Programme will be deemed to have represented and agreed that: i) the Preference Shares have not been and will not be registered under the US Securities Act and may not be offered or sold within the United States or to, or for the account of or benefit of, U.S. persons except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the US Securities Act; ii) iii) iv) the Preference Shares have not been recommended, approved or disapproved by the U.S. Securities and Exchange Commission, any other federal or any state securities commission in the USA or any other USA regulatory authority, nor have any of the foregoing authorities passed upon or endorsed the merits of the Preference Shares nor the accuracy or adequacy of this Programme Memorandum. Any representation to the contrary is a criminal offence in the USA;it has not offered or sold or delivered any Preference Shares, and will not offer or sell or deliver any Preference Shares: a. as part of their distribution at any time; or b. otherwise until 40 days after completion of the distribution, as determined and certified by the Dealer or, in the case of an issue of such Preference Shares on a syndicated basis, the relevant Lead Manager, of all Preference Shares of the Tranche of which such Preference Shares are a part, within the United States or to, or for the account or benefit of, U.S. persons; it will send to each dealer to which it sells any Preference Shares in that Tranche during the distribution compliance period a confirmation or other notice setting forth the restrictions on offers and sales of such Preference Shares within the United States or to, or for the account or benefit of, U.S. persons; and it, and its Affiliates and any persons acting on its or any of its Affiliates behalf have not engaged and will not engage in any directed selling efforts with respect to the Preference Shares in that Tranche and it, its Affiliates and any persons acting on its or any of its Affiliates behalf have complied and will comply with the offering restrictions requirements of Regulation S. In addition, until 40 days after the commencement of the offering of a Series of Preference Shares, an offer or sale of such Preference Shares within the United States by any dealer (whether or not participating in the offering) may violate the registration requirements of the US Securities Act if such offer or sale is made otherwise than in accordance with an exemption from registration under the US Securities Act. United Kingdom Prior to the issue of any Tranche of Preference Shares under the Programme by the Issuer, each Dealer for that Tranche of Preference Shares will be required to represent and agree that: i) it has not offered or sold, and prior to the expiry of a period six months from the Issue Date in respect of each Tranche of Preference Shares will not offer or sell, any Preference Shares in that Tranche to persons in the United Kingdom, except to Relevant Persons or in circumstances which have not resulted and will not result in an offer to the public in the United Kingdom within the meaning of the Public Offers of Preference Shares Regulations, 1995 of the United Kingdom; 84

ii) iii) it has complied with and will comply with all applicable provisions of the FSMA with respect to anything done by it in relation to the Preference Shares in that Tranche in, from or otherwise involving the United Kingdom; and it has only communicated or caused to be communicated and will only communicate or cause to be communicated any invitation or inducement to engage in investment activity (within the meaning of section 21 of the FSMA) received by it in connection with the issue or sale of any Preference Shares in that Tranche in circumstances in which section 21(1) of the FSMA does not apply to the Issuer. European Economic Area In relation to each Member State of the European Economic Area which has implemented the Prospectus Directive (each, a Relevant Member State ), each of the Issuer and Dealer(s) has represented and agreed that, with effect from and including the date on which the Prospectus Directive is implemented in that Relevant Member State (the Relevant Implementation Date ), it has not made, and will not make an offer of Preference Shares to the public in that Relevant Member State except that it may, with effect from and including the Relevant Implementation Date, make an offer of Preference Shares to the public in that Relevant Member State: i) in the period beginning on the date of publication of a Programme Memorandum in relation to those Preference Shares which Programme has been approved by the competent authority in that Relevant Member State in accordance with the Prospectus Directive and/or, where appropriate, published in another Relevant Member State and notified to the competent authority in that Relevant Member State in accordance with Article 18 of the Prospectus Directive and ending on the date which is 12 months after the date of such publication; ii) iii) iv) at any time to legal entities which are authorised or regulated to operate in the financial markets or, if not so authorised or regulated, whose corporate purpose is solely to invest in Preference Shares; at any time to any legal entity which has two or more of (i) an average of at least 250 employees during the last financial year; (ii) a total balance sheet of more than 43,000,000; and (iii) an annual net turnover of more than 50,000,000 as shown in its last annual or consolidated accounts; or at any time in any other circumstances which do not require the publication by the Issuer of a Programme Memorandum pursuant to Article 3 of the Prospectus Directive. For the purposes of this provision, the expression an offer of Preference Shares to the public in relation to any Preference Shares in any Relevant Member State means the communication in any form and by any means of sufficient information on the terms of the offer and the Preference Shares to be offered so as to enable an investor to decide to purchase or subscribe for the Preference Shares, as the same may be varied in that Member State by any measure implementing the prospectus directive in that Member State and the expression Prospectus Directive means Directive 2003/71/EC (and amendments thereto, including the 2010 PD Amending Directive, to the extent implementation in the Relevant Member State) and includes any relevant implementing measure in each Relevant Member State and the expression 2010 PD Amending Directive means Directive 2010/73/EU. 85

General Prior to the issue of any Tranche of Preference Shares under the Programme, each Dealer for that Tranche of Preference Shares will be required to represent and agree that it will (to the best of its knowledge and belief) comply with all applicable laws and regulations in force in each jurisdiction in which it purchases, subscribes or procures subscriptions for, offers or sells Preference Shares in that Tranche or has in its possession or distributes the Programme Memorandum and will obtain any consent, approval or permission required by it for the purchase, subscription, offer or sale by it of Preference Shares in that Tranche under the laws and regulations in force in any jurisdiction to which it is subject or in which it makes such purchases, subscriptions, offers or sales. Each Dealer for a Tranche of Preference Shares will be required to represent and agree that it will comply with such other or additional restrictions in relation to that Tranche of Preference Shares as the Issuer and such Dealer agree and as are set out in the Applicable Pricing Supplement. Neither the Issuer nor any of the Dealers represent that Preference Shares may at any time lawfully be subscribed for or sold in compliance with any applicable registration or other requirements in any jurisdiction or pursuant to any exemption available thereunder or assumes any responsibility for facilitating such subscription or sale. 86

GENERAL INFORMATION Words used in this section headed General Information shall bear the same meanings as used in the section headed Definitions and Interpretations and as defined elsewhere in this Programme Memorandum, except to the extent that they are separately defined in this section or the context otherwise requires. 1. Authorisation All consents, approvals, authorisations or other orders of all regulatory authorities required by the Issuer under the laws of South Africa as at the date of this Programme Memorandum have been given for the establishment of the Programme and the issue of Preference Shares and for the Issuer to undertake and perform its obligations under the Programme Memorandum and the Preference Shares. 2. Listing 2.1 The Programme was initially approved by the JSE on 08 September 2014, and subsequently an update to the Programme Memorandum to, inter alia, incorporate the Class G Preference Share, was approved on 15 December 2015. Add hoc application are made to the JSE for the listing of Preference Shares on the Main Board, under the following details: Class A Preference Shares Class B Preference Shares Class C Preference Shares Class G Preference Shares Abbreviated name: Ecsponent, JSE share code: ECSP1, ECSP4, and ECSP7 Abbreviated name: Ecsponent, JSE share code: ECSP2, ECSP5 and ECSP 8 Abbreviated name: Ecsponent JSE share code: ECSP3, ECSP6 and ECSP9 Abbreviated name: Ecsponent* 2.2 Preference shares to be issued under the first Tranche amount to 1000 000 Class A Preference Shares, 1 000 000 Class B Preference Shares and 1 000 000 Class C Preference Shares, as set out in the Prospectus 3. Documents Available For Inspection 3.1 Copies of the following documents will be available for inspection at the Company s registered office and at the offices of the Transfer Secretaries during business hours from date of issue of this Programme Memorandum and up to the date that the Preference Shares are no longer issued or outstanding: 3.1.1 the signed Programme Memorandum; 3.1.2 any supplementary documents published after this Programme Memorandum is published; 3.1.3 any Applicable Pricing Supplements (with respect to outstanding issues) issued after this Programme Memorandum was published; 3.1.4 Document incorporated into this Programme Memorandum by reference, as set out in the section headed Documents Incorporated by Reference, which includes the financial information of the Issuer. 87

4. Material Changes 4.1 As at the Programme Date, and after due and careful inquiry, there has been no material change in the financial or trading position of the Issuer since the date of the Issuer s latest audited financial statements, save for the changes noted below. As at the Programme Date, there has been no involvement by Nexia SAB&T Chartered Accountants Inc. Inc. in making the aforementioned statement. 4.2 Post year end, the following changes have occurred: 4.1.1 the Acquisitions, which also resulted in the establishment of a convertible loan facility in favour of Ecsponent Capital, to the value of R45 million; 4.1.2 the R100 million Rights Offer, partially underwritten by Ecsponent Capital through the capitalisation of their convertible loan facility; 4.1.3 the disposal of the SO 2 gas sheet manufacturing business within Vingaurd to Grapetek for a purchase consideration of R6.3 million; and 4.1.4 the change in name from John Daniel Holdings Limited to Ecsponent Limited. 4.3 The above statement by the Directors regarding material changes has not been audited or reviewed by the Group s auditors. 5. Litigation Ecsponent is not nor has it been involved in any legal or arbitration proceedings (including any such proceedings which are pending or threatened of which the Issuer is aware) which may have or have had a significant effect on its financial position 6. Auditors AM Smith and Company Inc. have acted as the auditors of the financial statements of Ecsponent for the financial year ended 31 December 2011, 2012 and 2013 and, in respect of those years, have issued unqualified audit reports. Ecsponent has appointed Nexia SAB&T Chartered Accountants Inc. as the auditors following the resignation of AM Smith and Company Inc. An unqualified audit opinion was issued by Nexia SAB&T Chartered Accountants Inc. for the year ended December 2014. SIGNED BY EUNE ENGELBRECHT AND BRYAN SHANAHAN IN PRETORIA ON BEHALF OF ALL OF THE DIRECTORS OF THE COMPANY IN TERMS OF POWERS OF ATTORNEY GRANTED BY THEM: Eune Engelbrecht Chief Executive Officer 15 December 2015 Bryan Shanahan Group Financial Director 15 December 2015 88

NOTES 89

NOTES 90

ANNEXURE 1 DIVIDENDS TAX DECLARATION AND EXEMPTION Instructions 1. This form relates to exemptions from Dividends Tax referred to in section 64F read with sections 64FA(2), 64G(2) or 64H(2)(a) of the Income Tax Act, 1962 (Act No 58 of 1962) (the Act). 2. This form should be completed by the beneficial owner in order for the exemptions to apply. 3. Please email this form to ashburtoninstruct@investoradmin.co.za, or fax it to 0860 762 468. 4. In order to qualify for exemption this declaration and written undertaking should be submitted to Ashburton before the payment of an affected dividend. Failure to do so will result in the full amount of Dividends Tax, currently 15%, being withheld/payable. A) Beneficial Owner Details Investor number:... Full names and surname/registered name:... Nature of person/entity: Individual Listed Company Unlisted Company Trust (any type) RSA Government, provincial administration, municipalities Retirement fund (pension, provident, benefit, RA etc.) Other (please provide a description/explanation of nature of the entity/person): South African resident Non-resident Country of residence:... Country where tax is payable: Identity/registration number:... South African income tax reference number:...... Passport number:... Country of issue:... 91

B) EXEMPTION REASON Please indicate the reason why the beneficial owner is exempt from the dividends tax: (a) - a company which is resident in South Africa (b) - the Government, provincial government or municipality (of the Republic of South Africa) (c) - a public benefit organisation (approved by SARS ito section 30(3) of the Act) (d) - a trust contemplated in section 37A of the Act (mining rehabilitation trusts) (e) - an institution, body, or board contemplated in section 10(1)(cA) of the Act (f) - a fund contemplated in section 10(1)(d)(i) or (ii) of the Act (pension fund, pension preservation fund, provident fund, provident preservation fund, retirement annuity fund, beneficiary fund or benefit fund) (g) - a person contemplated in section 10(1)(t) of the Act (CSIR, SANRAL etc.) (j) - a person who is not a resident and the dividend is a dividend contemplated in paragraph (b) of the definition of dividend in section 64D (i.e. a dividend on a foreign company s shares listed in SA, such as dual-listed shares) B) Declaration And Undertaking Declaration in terms of sections 64FA(1)(a)(i), 64G(2)(a)(aa) or 64H(2)(a)(aa)of the Act: I... (full names in print please), the undersigned hereby declare that dividends paid to the investor is exempt, or would have been exempt had it not been a distribution of an asset in specie, from the dividends tax in terms of the paragraph of section 64F of the Act indicated above. Undertaking in terms of sections 64FA(1)(a)(ii), 64G(2)(a)(bb) or 64H(2)(a)(bb) of the Act: I... (full names in print please), the undersigned undertake to forthwith inform Ecsponent Ltd in writing should the circumstances of the investor referred to in the declaration above change. Signature of investor/authorised signatory:... Capacity of signatory (if not the investor):... Date.../.../... 92

ECSPONENT LIMITED HEAD OFFICE Acacia House Green Hill Village Office Park, on Lynnwood Road Cnr Botterklapper & Nentabos Street The Willows Pretoria East FOR MORE INFORMATION PLEASE CONTACT US ON Tel: 087 808 0100 Fax: 086 432 3459 E-mail: info@ecsponent.com www.ecsponent.com