Mvelaserve Limited

(Incorporated in the Republic of South Africa) (Registration number 1999/003610/06) JSE Share code: MVS ISIN: ZAE000151353

(“Mvelaserve” or the “Group”)

PRE-LISTING STATEMENT
The definitions and interpretations set out on pages 10 to 14 of this Pre-listing Statement apply mutatis mutandis to this section of the Pre-listing Statement. Prepared and issued in terms of the Listings Requirements of the JSE Limited relating to the listing of the entire issued share capital of Mvelaserve on the JSE. Proposed Listing Date on the JSE from the commencement of business on Monday, 29 November 2010

This Pre-listing Statement is not an invitation to the general public to subscribe for or purchase Mvelaserve Ordinary Shares, but is issued in compliance with the Listings Requirements and with the Companies Act for the purposes of giving information to the public with regard to Mvelaserve. This Pre-listing Statement has been prepared on the assumption that the ordinary and/or special resolutions proposed in the notice of general meeting forming part of the circular to shareholders of Mvela Group dated 27 October 2010, which is enclosed in the same envelope with this Pre-listing Statement, will be passed at the general meeting of shareholders of Mvela Group to be held on Thursday, 18 November 2010, and that the special resolution, if included, is registered at CIPRO, and that the Unbundling (the details of which are reflected in the Mvela Group circular), will accordingly be implemented. This Pre-listing Statement should be read in conjunction with the Mvela Group circular. The Listing is conditional on: • the registration of the special resolutions passed by Mvelaserve Ordinary Shareholders related to the alteration of the share capital of Mvelaserve, as detailed in paragraph 39 to this Pre-listing Statement, by CIPRO; • the passing, by Mvela Group shareholders at the Mvela Group combined general meeting, of the requisite resolutions required to approve the Unbundling; and • the registration of any special resolutions passed by Mvela Group shareholders related to the Unbundling by CIPRO (if required). At the Listing Date the authorised share capital of Mvelaserve will comprise 500 000 000 Ordinary Shares with no par value. Mvelaserve will have an issued ordinary share capital comprising 141 561 673 Ordinary Shares with no par value. There will be no other class of shares authorised or issued by Mvelaserve at the Listing Date. All the Ordinary Shares in Mvelaserve rank pari passu in all respects, and all have equal rights to participate in capital, dividend and profit distributions by Mvelaserve. The Ordinary Shares are fully paid-up and freely transferrable. Mvelaserve does not have any treasury shares. Approval of Mvelaserve’s application for the listing of 141 561 673 Ordinary Shares in the “Business Support Services” sector of the JSE lists, under the abbreviated name “Mvelasv” JSE code “MVS” and ISIN: ZAE000151353 has been granted by the JSE, subject to fulfilment of the conditions precedent referred to on page 9 of this Pre-listing Statement. It is anticipated that the Listing will become effective from the commencement of business on or about Monday, 29 November 2010.. The Ordinary Shares will only be traded in electronic form and as such all shareholders who elect to receive Ordinary Shares in certificated form will have to dematerialise their certificated Ordinary Shares should they wish to trade therein. The Directors, whose names are given in the “Corporate information” section of this Pre-listing Statement, collectively and individually, accept responsibility for the accuracy of the information given and certify that to the best of their 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 and that this Pre-listing Statement contains all information required by law and the Listings Requirements. Each of the investment bank and sponsor, legal advisers, reporting accountants and auditors, and transfer secretaries have consented in writing to act in the capacities stated and to their names being included in this Pre-listing Statement and have not withdrawn their consent prior to the publication of this Pre-listing Statement. The reporting accountants and auditors have consented to the inclusion of their reports in the form and context in which they appear and have not withdrawn such consent prior to the publication of this Pre-listing Statement. Copies of this Pre-listing Statement are only available in English and may be obtained during normal business hours from the date of this Pre-listing Statement until 26 November 2010 from the registered office of Mvelaserve, and the offices of the investment bank and sponsor, the addresses of which are set out in the “Corporate Information” section of this Pre-listing Statement. Investment bank and sponsor Legal advisers Reporting accountants and auditors Debt structuring advisers

Date of issue: Wednesday, 27 October 2010

IMPORTANT LEGAL NOTES

SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS Many of the statements included in this Pre-listing Statement are forward-looking statements that involve risks and uncertainties. Forward-looking statements may generally be identified by the use of terminology such as “may”, “will”, “expect”, “intend”, “plan”, “estimate”, “anticipate”, “believe”, or similar phrases. Other than statements of historical acts, all statements, including, among others, statements regarding the future financial position of the Mvelaserve, business strategy, projected levels of growth in its market, projected costs, estimates of capital expenditures and plans and objectives of management for future operation, are forward-looking statements. The actual future performance of Mvelaserve could differ materially from these forward-looking statements. Important factors that could cause actual results to differ materially from these expectations include those risks set out in Part E of this Pre-listing Statement headed “Risk factors”, as well as other matters not yet known to the Directors or not currently considered material by them. Forward-looking statements should not be relied on and are deemed to be of no force and effect. Any reliance placed on forward-looking statements should be circumscribed and qualified by the contents of the cautionary statements made in this Pre-Listing Statement. Moreover, unless the Board is required by law or the Listings Requirements to update these statements, they will not update any of these statements after the date of this Pre-listing Statement, either to equate them to actual results or to changes in their expectations. Special note regarding date of information provided Unless the context clearly indicates otherwise, all information provided in this Pre-listing Statement is provided as at the Last Practicable Date.

CORPORATE INFORMATION

Directors of Mvelaserve M S M Xayiya (Executive Chairman) † J M S Ferreira (Chief Executive Officer) G E Röth (Chief Financial Officer) O A Mabandla * † S Masinga * † N Mbalula * † F N Mantashe * † G D Harlow * † M J Schermers # P A M Mahlangu-Armstrong # Y Z Cuba # * Independent non-executive † Appointed as a director of Mvelaserve with effect from the Listing Date. # Current directors of Mvelaserve who will resign with effect from the Listing Date. Investment bank and sponsor Investec Bank Limited (Registration number 1969/004763/06) Second Floor, 100 Grayston Drive Sandown Sandton, 2196 (PO Box 785700, Sandton, 2146) Reporting accountants and auditors PKF (Jhb) Inc. (Registration number 1994/001166/21) 42 Wierda Road West Wierda Valley Sandton, 2169 (Private Bag X10046, Sandton, 2146) Debt structuring advisers Nedbank Limited (Registration number 1951/0000009/06) 135 Rivonia Road Sandown Sandton, 2169 (PO Box 1144, Johannesburg, 2000)

Company secretary and registered office Mvelaphanda Management Services (Proprietary) Limited Registration number 2000/012781/07 28 Eddington Crescent Highveld Technopark, Centurion, 0169 (PO Box 67501, Highveld, 0169)

Legal advisers Cliffe Dekker Hofmeyr Inc. (Registration number 2008/018923/21) 1 Protea Place Sandton, 2196 (Private Bag X7, Benmore, 2010)

Transfer secretaries Computershare Investor Services (Proprietary) Limited (Registration number 2004/003647/07) Ground Floor 70 Marshall Street Johannesburg, 2001

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Key investment considerations 10. Group structure and business units 6. HIV/Aids 15. Corporate social investment 16. Black economic empowerment 11. remuneration and borrowing powers of directors 19. Directors’ interests in the share capital of Mvelaserve 20. Employees 13. Major and controlling shareholders 7. Information technology 12. Nature of business 2.CONTENTS Page IMPORTANT LEGAL NOTES CORPORATE INFORMATION SALIENT INFORMATION DEFINITIONS AND INTERPRETATIONS PRE-LISTING STATEMENT PART A:THE BUSINESS OF MVELASERVE 1. Directors’ interests in transactions 21. Training programmes 14. Corporate Governance Inside front cover 1 5 10 15 15 15 16 16 17 18 23 24 24 25 25 25 26 26 27 27 27 32 32 35 36 36 36 36 2 . Mvelaserve’s strategies for growth 4. Rationale for listing 9. Prospects 8. Incorporation and history 5. Directors and management 18. Regulatory environment PART B: MANAGEMENT AND CORPORATE GOVERNANCE 17. Appointment. Key strengths 3. qualification. Management lock-in 22.

Strate PART H:TAX AND EXCHANGE CONTROL 47. Taxation issues 48. Cash flow analysis 36. Working capital statement PART D: MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITIONS AND RESULTS OF OPERATIONS 28. Operating profit 31. Analysis of statement of financial position PART E: RISK FACTORS 37. Share capital 39. Operating costs 30. Previous offers PART G: PARTICULARS OF THE LISTING 43. Exchange Control 49. Historical financial information 24. Revenue 29. Alterations to share capital in the past three years 40. Loan capital and material loans 25. Dematerialisation of Mvelaserve Ordinary Shares 46.Page PART C: FINANCIAL INFORMATION – HISTORICAL FINANCIAL INFORMATION. Listing of Mvelaserve Ordinary Shares on the JSE 44. Exchange Control Regulations 45. Employee costs 33. PRO FORMA FINANCIAL INFORMATION AND DIVIDEND POLICY 23. Unbundling 50. Material changes 27. Finance costs 34. Taxation 35. Depreciation 32. Risks related to Mvelaserve’s business PART F: SHARE CAPITAL 38. Options or preferential rights in respect of shares 42. Tax consequences in respect of the Unbundling 42 42 46 46 46 46 47 48 48 48 48 48 49 49 49 49 50 50 53 53 54 54 54 54 55 55 55 55 55 56 56 59 60 61 3 . Dividends and dividend policy 26. Ordinary shares issued otherwise than for cash 41.

Consents 66. Information on Subsidiaries 53. Restructuring 52. Expenses 64. Loan capital and material loans 62. Lease payments 61. Interests of advisers and promoters. Material contracts 58. Contingent liabilities 60. respectively Reporting accountants’ report on the historical financial information of Mvelaserve and its Subsidiaries Unaudited pro forma statement of comprehensive income and statement of financial position of Mvelaserve Independent reporting accountants’ report on the unaudited pro forma statement of comprehensive income and statement of financial position of Mvelaserve Particulars and remuneration of the Directors and senior management of Mvelaserve Details of Subsidiary companies and their directors Details of principal immovable properties leased or owned Material acquisitions and disposals in the preceding 3 years 65 65 65 65 65 65 65 65 66 66 66 66 66 67 67 67 67 68 69 71 117 119 123 125 135 141 142 143 145 146 ANNEXURE 3 ANNEXURE 4 ANNEXURE 5 ANNEXURE 6 ANNEXURE 7 ANNEXURE 8 ANNEXURE 9 ANNEXURE 10 Details of material borrowings and material loans ANNEXURE 11 Material contracts entered into by Mvelaserve In the 2 years preceding the date of the Pre-listing Statement ANNEXURE 12 Extracts from the Articles of Association 4 . Disposal of property 56. Documents available for inspection 67. Commissions paid or payable in respect of underwriting 65. Principal immovable property owned or leased 54. Directors’ responsibility statement ANNEXURE 1 ANNEXURE 2 The Restructuring The audited and reviewed consolidated financial information of Mvelaserve and its Subsidiaries for the year ended 30 June 2010 and the years ended 30 June 2009 and 30 June 2008. Property and Subsidiaries acquired or to be acquired and vendors 55.Page PART I: ADDITIONAL INFORMATION 51. Litigation statement 63. and amounts paid or payable to promoters 57. Material capital commitments 59.

• leading position in attractive markets. This has resulted in strong cash flows and improved returns to shareholders. security. namely: facilities management. • maximising cross-selling opportunities via the client relationship management system developed by the corporate office. employing approximately 30 000 people. inter alia: • well established and recognised brands. including both private sector and government organisations. • strong portfolio of blue chip clients. KEY STRENGTHS Mvelaserve’s key strengths include: • Balanced business portfolio Mvelaserve has a balanced portfolio across its markets and regions of operation. Investors should read the entire Pre-listing Statement. • leadership and support from an experienced team of corporate executives. Mvelaserve’s operating principles are: • autonomy of the individual subsidiaries under skilled entrepreneurial. The definitions and interpretations set out in pages 10 to 14 of this Pre-listing Statement apply mutatis mutandis to this “Salient Information” section of the Pre-listing Statement. The Group offers a wide range of integrated services in the areas of facilities management. and it may not contain all the information that investors should consider before deciding to invest in the Mvelaserve Ordinary Shares. pie manufacturing and franchising as well as freight markets. with a strong focus on corporate governance practices. • established national footprint. experienced and decentralised operational management. • preferred supplier status in many industries. • diversification of service offerings. catering and cleaning. catering and cleaning and diversified services. • Operational advantages Mvelaserve’s operational advantages include. It also provides services in the gambling. • Proven financial performance Mvelaserve has consistently achieved significant year-on-year growth. OVERVIEW Mvelaserve is a leading provider of integrated outsourced business support services in South Africa through its network of operating subsidiaries. Mvelaserve has a decentralised management structure to afford substantial autonomy to the business units where the focus is on expansion through growth. • strong financial management and operating systems at subsidiary level. It has a balanced client portfolio. and • group procurement activities. Mvelaserve’s intention is to become the leading provider of integrated outsourced business support services to South Africa and the rest of the continent. including the “Risk Factors” and the historical consolidated financial information and other information about Mvelaserve contained herein. 5 . margin enhancement and increased profitability.SALIENT INFORMATION The following information is only a summary of the more detailed information contained in the main body of this Pre-listing Statement. The Group operates under four business units. security.

a committed and loyal workforce. This information has been extracted from the audited consolidated financial statements included in Annexure 2 to this Pre-listing Statement. Mvelaserve continually seeks opportunities to further strengthen its position as a market leader. strong entrepreneurial and skilled senior management. consistently strong corporate governance practices. Immediately after the Listing and Unbundling. • Improving market positioning Mvelaserve aims to maintain its recognised leadership in the integrated outsourced business support services market.This will initially be achieved by following the Mvelaserve client base and establishing separate decentralised businesses with select local partners in the target countries. Mvelaserve will have the same ordinary shareholder profile as Mvela Group. long-standing business relationships. This information should be read in conjunction with such financial statements and the related notes. • Expanding the Group’s footprint into the continent of Africa Mvelaserve aims to leverage off its well-established. empowering the management teams of each subsidiary. and seeking to maximise shareholder returns. • Empowerment credentials Currently as a result of the 100% shareholding by Mvela Group. recognised brands to expand the Group’s footprint on the rest of the continent. diversified offering of outsourced services. STRATEGIES FOR GROWTH Mvelaserve’s strategy is to continue to grow and build the business into the recognised leader in integrated outsourced business support services in South Africa and the rest of the continent. 6 . This will be achieved by: • Optimising profitability of established businesses Mvelaserve intends to continue its ongoing business optimisation programmes. strengthening margins. entrenched cross-selling capability.4% BEE shareholding including Mandated Investments). with a proven track record. giving it an equally strong BEE ownership platform. • Organic expansion Mvelaserve intends to penetrate new markets leveraging off its BEE platform and client base. SUMMARY OF CONSOLIDATED FINANCIAL INFORMATION The summarised consolidated statement of comprehensive income and statement of financial position of Mvelaserve and its subsidiaries for the financial years ended 30 June 2010 and 2009 are set out below. and thorough understanding of the markets in which it operates. and is confident that the Group is well-positioned to benefit from recovering economic growth in South Africa and the rest of the continent.• • • • • • • experienced.5% BEE shareholding excluding Mandated Investments (45. Mvelaserve has an effective 68. • Growing through strategic acquisitions Mvelaserve seeks to grow though investing in businesses with the potential to enhance the current service offering while growing free cash flow and return on investment.

9% 5.3% 8.Summarised consolidated statement of comprehensive income 12 months ended 30 June (R’000) Revenue Profit from operations Net finance costs Fair value adjustments and net loss from investments Share of profits from associates Profit before tax Taxation Profit/(Loss) for the year from continuing operations Profit for the year from discontinued operations Total comprehensive income for the year Attributable to: Ordinary shareholders Minority shareholders Weighted average number of ordinary shares in issue Earnings per ordinary share (R’000) Headline earnings per ordinary share (R’000) Diluted earnings per ordinary share (R’000) Diluted headline earnings per ordinary share (R’000) Additional information EBITDA (R’000) Operating profit margin EBITDA margin Profit before taxation margin Revenue growth Operating profit growth EBITDA growth Profit before taxation growth 2010 (Audited) 4 061 998 291 287 (60 494) (2 726) 6 075 234 142 (80 282) 153 860 1 155 155 015 2009 (Reviewed) 3 601 257 190 592 (92 383) (40 564) 3 463 61 108 (72 753) (11 645) 1 533 (10 112) 151 798 3 217 100 1 518 1 514 1 518 1 514 (12 473) 2 361 100 (125) (143) (125) (143) 400 970 7.7% 7 .4% 283.8% 52.2% 1.2% 296 243 5.8% 12.8% 35.2% 9.

particularly as it relates to business and consumer growth. improve service offerings to its client base. with some exposure to the consumer market. plant and equipment Intangible assets Other non-current assets Current assets Trade and other receivables Trade and other receivables – Mvela Group Cash and cash equivalents Other current assets Assets in disposal group held for sale Total assets EQUITY AND LIABILITIES Capital and reserves Shareholders’ equity Distributable reserves Non-current liabilities Interest bearing liabilities – preference share funding Non-interest bearing liabilities – Mvela Group Other non-current liabilities Current liabilities Trade and other payables Interest bearing liabilities – Mvela Group Other current liabilities Liabilities in disposal group held for sale Total equity and liabilities Net number of ordinary shares in issue Net asset value per ordinary share (R’000) Net tangible assets per ordinary share (R’000) 2010 (Audited) 2009 (Reviewed) 975 105 387 619 545 335 42 151 1 753 501 763 876 97 878 374 809 516 938 5 045 2 733 651 928 440 312 602 544 000 71 838 1 417 826 705 467 97 878 210 251 404 230 – 2 346 266 233 300 227 817 5 483 1 367 158 482 438 722 117 162 603 1 133 193 793 736 100 478 238 979 – 2 733 651 100 2 278 (3 550) 78 899 76 019 2 879 1 179 327 482 438 566 362 130 527 1 088 042 748 003 93 560 246 479 – 2 346 266 100 760 (5 010) PROSPECTS The outsourced business support services industry in South Africa is intrinsically linked to the growth in global gross domestic product (“GDP”) as well as South African GDP. Mvelaserve was not adversely affected by the global financial crisis in the past two years and is well positioned to take further advantage of economic growth in South Africa and the rest of the continent. while Mvelaserve delivers a value-for-money basket of non-core services. and improved consumer demand will assist in speeding up the recovery.Summarised consolidated statement of financial position At 30 June (R’000) ASSETS Non-current assets Property. with strategic acquisitions. the rate thereof remains uncertain. South Africa appears to be on the path to economic recovery. and lower inflation environment. After the adverse economic conditions created by the global financial crisis experienced in the past two years. It is the opinion of the Directors that as primarily business-to-business outsourced support service providers. The Group will continue to seek to partner with clients in the management of their assets. 8 . Mvelaserve will. internal development and internal growth. affording clients the room to concentrate on their core business. Improved fundamentals of a lower interest rate. However.

will change. a Prospective Investor should use his or her own judgment and seek advice from an independent financial adviser as to the appropriate value of Mvelaserve Ordinary Shares. the provisional entitlement ratio of 25 Mvelaserve Ordinary Shares for every 100 Mvela Group Shares. which Ordinary Shares will be listed in the “Business Support Services” sector of the Main Board of the JSE. and • the registration by CIPRO of any special resolution required to be passed in connection with the Unbundling. on the assumption that all Mvela Group preference shares are converted into Mvela Group Shares to the extent that all Mvela Group preference shares are not converted into Mvela Group Ordinary Shares. 19 November 2010. in the Mvela Group finalisation announcement which is expected to be released on SENS on or about Friday.THE UNBUNDLING Subject to the fulfilment of the conditions precedent set out in the paragraph below. The Unbundling will be implemented such that each beneficial owner of Mvela Group Shares will become a beneficial owner of unbundled Mvelaserve Ordinary Shares. The entitlement ratio will be confirmed or. Mvela Group will distribute the Mvelaserve Ordinary Shares to its shareholders by way of the Unbundling. RISK FACTORS The section of this Pre-listing Statement entitled “Risk Factors” describes certain risk factors that should be considered together with the other information in this Pre-listing Statement before making a decision to invest in the listed Mvelaserve Ordinary Shares post the Listing. as the case may be. as detailed in paragraph 39 to this Pre-listing Statement. The Unbundling will be in terms of section 90 of the Companies Act. Although information has been provided in this Pre-listing Statement in relation to Mvelaserve Ordinary Shares. All Mvela Group Ordinary Shareholders will receive 25 Mvelaserve Ordinary Shares for every 100 Mvela Group Shares held by them on the Record Date. 9 . revised. the relevant provisions of the Listings Requirements and section 46 of the Income Tax Act. by CIPRO. • the passing by Mvela Group Ordinary Shareholders at the Mvela Group Combined General Meeting of the requisite resolutions required to approve the Unbundling. CONDITIONS PRECEDENT The JSE has approved the Listing subject to the following conditions precedent: • the registration of the special resolutions passed by Mvelaserve Ordinary Shareholders related to the alteration of the share capital of Mvelaserve.

the Codes of Good Practice on Broad-Based Black Economic Empowerment. South Africa. Central Securities Depository Participant. issued by the Minister of Trade and Industry in South Africa and gazetted on 9 February 2007. “Board of Directors”. with new debt from Nedbank Limited. Capital Gains Tax as levied in terms of the Eighth Schedule to the Income Tax Act. Rebhold Freight Services 2000 (Proprietary) Limited (registration number 1987/000113/07). trading as Contract Forwarding. as presented in Annexure 2 to this Pre-listing Statement. No. “Board” or “Directors” “Business Day” “CEMS” “Certificated Ordinary Shares” “CGT” “CIPRO” “Cliffe Dekker Hofmeyr” “Closed Periods” “Codes” “Common Monetary Area” “Companies Act” “Competition Act” “Contract Forwarding” “CPA” “CSDP” “Debt Restructure” 10 . Sunday or an official public holiday in South Africa. unless the context indicates otherwise. any day other than a Saturday. as amended. the process of replacing the preference share funding of Mvelaserve as per the historical financial information for the year ended 30 June 2010. a company duly incorporated in South Africa. a participant as defined in section 1 of the Securities Services Act. BMO Food Services (Proprietary) Limited (registration number 1998/013348/07). the Republic of Namibia and the Kingdoms of Swaziland and Lesotho. the Competition Act. a private company duly incorporated in South Africa. Central Electronic Monitoring System. as defined in the BBBEE Act. Companies and Intellectual Property Registration Office. (registration number 2008/018923/21). 89 of 1998. a natural person includes a juristic person and vice versa and cognate expressions shall bear corresponding meanings. as amended. the Companies Act. the words in the first column shall have the meanings assigned to them in the second column. and wholly-owned by Mvelaserve. the board of directors of Mvelaserve at the Listing Date and whose names are given in the Corporate Information section of this Pre-listing Statement. being the legal advisers of Mvelaserve. the Broad-Based Black Economic Empowerment Act. an expression which denotes one gender includes the other genders. closed periods as defined in the Listings Requirements. 68 of 2008. specifying empowerment measurement principles and targets consistent with the objectives of the BBBEE Act.DEFINITIONS AND INTERPRETATIONS In this Pre-listing Statement. Ordinary Shares that have not been Dematerialised. the singular includes the plural and vice versa. No. “Articles” or “Articles of Association” “BBBEE Act” “BEE” “BMO Food Services” the articles of association of Mvelaserve. 61 of 1973. a private company duly incorporated in South Africa and wholly-owned by King Pie Holdings. as amended. a system established by the National Gambling Board to monitor and record gambling revenue from LPM’s. to ensure that correct gaming levies and taxes are collected by the regulator while the players are protected at the same time. No. 53 of 2003. as amended. black economic empowerment. as amended. Cliffe Dekker Hofmeyr Inc. 36 of 2004. No. No. the Consumer Protection Act.

a public company duly incorporated in South Africa. No. gambling machines outside of a casino in respect of the playing of which the stakes and prizes are limited as prescribed by the gambling regulations. International Financial Reporting Standards issued by the International Accounting Standards Board. as amended. the ratio obtained by expressing after-tax earnings per share as a fraction of dividends paid per share. 36 of 2004. No. collectively. Wednesday. the Exchange Control Department of the South African Reserve Bank. No. the final number of Mvelaserve Ordinary Shares to which a Mvela Group Ordinary Shareholder is entitled. earnings before interest. the Employment Equity Act.“Dematerialise” the process whereby physical share certificates are replaced with electronic records evidencing ownership of shares for the purpose of Strate. the South African Code of Corporate Practices and Conduct as set out in the third King Report on Corporate Governance. certified transfer deeds. share certificates. as amended. promulgated in terms of section 9 of the South African Currency and Exchanges Act. 9 of 1933. close of business. being “uncertificated securities” as defined in section 91A of the Companies Act. King Pie Holdings and BMO Food Services. historically disadvantaged South Africans. as amended. which is licensed to operate an exchange under the Securities Services Act. whose shares are listed on the JSE. King Pie Holdings (Proprietary) Limited (registration number 1997/008676/07). 55 of 1998. as amended. the Income Tax Act. Human Immunodeficiency Virus/Acquired Immunodeficiency Syndrome. being the investment bank and sponsor to Mvelaserve. as amended. No. depreciation and amortisation. as amended from time to time. 20 October 2010. and wholly-owned by Mvelaserve. 58 of 1962. a public company duly incorporated in South Africa. as amended. Investec Bank Limited (registration number 1969/004763/06). means Part VIII of Chapter II of the Income Tax Act as initially promulgated by section 56(1) of Act No 60 of 2008 and subsequently amended. the National Gambling Act. a private company duly incorporated in South Africa. pursuant to the Unbundling for every 100 Mvela Group Shares held by the Mvela Group Ordinary Shareholder on the Record Date. No. Ordinary Shares that have been Dematerialised. being the last practicable date prior to finalisation of this Pre-listing Statement. JSE Limited (registration number 2005/022939/06). 7 of 2004. “Dematerialised Ordinary Shares” “dividend cover” “Dividend Tax Legislation” “documents of title” “EBITDA” “Employment Equity Act” “entitlement ratio” “Exchange Control Regulations” “Excon” “Gambling Act” “HDSA” “HIV/AIDS” “IFRS” “Income Tax Act” “Investec Bank” “JSE” “Khuseti” or “Khuseti Holdings” “King Code” “King Pie Holdings” “Last Practicable Date” “limited payout machines” or “LPM’s” 11 . taxation. the Exchange Control Regulations of South Africa. balance receipts or any other documents of title to certificated shares.

the circular to shareholders of Mvela Group. prior to the Listing and Unbundling. the Companies Act. 12 . the date upon which Mvelaserve lists its Ordinary Shares on the exchange operated by the JSE. from time to time. and any company which is a Subsidiary of Mvelaserve. the listings requirements of the JSE. ordinary shares with no par value in the issued share capital of Mvelaserve. a public company duly incorporated in South Africa whose shares are listed on the JSE. which has been promulgated and will eventually replace the Companies Act upon coming into force. No. Melrose Arch.001 each in the issued share capital of Mvela Group. “Mvelaphanda Management Services” Mvelaserve Management Services (Proprietary) Limited (registration number or “MMS” 2000/012781/07). 71 of 2008. a private company duly incorporated in South Africa. which will take place at Melrose Arch Hotel. “Memorandum” or “Memorandum of Association” “Mvela Group” “Mvela Group circular” “Mvela Group Combined General Meeting” “Mvela Group Ordinary Shareholders” the registered holders of Mvela Group Shares. High Street. Mvelaserve. the registered holders of Mvelaserve Ordinary Shares. in terms of the notice of combined general meeting attached to and forming part of the Mvela Group circular. Mvelaphanda Group Limited (registration number 1995/004153/06). whose mandate is governed by that legislation. “Mvela Group Shares” “Mvelaphanda Holdings” ordinary shares with a par value of R0. as amended. the senior management of Mvelaserve. any investments made by or through any third party regulated by legislation on behalf of the actual owner of the funds pursuant to a mandate given by the owner of the funds. holds 100% of Mvelaserve Ordinary Shares. from time to time.“Listing” “Listing Date” “Listings Requirements” “management” “Mandated Investments” the admission of the Mvelaserve Ordinary Shares to the list maintained by the JSE of securities admitted to listing and trading on the exchange operated by the JSE. a private company duly incorporated and registered in South Africa and currently a shareholder of Mvela Group. net asset value. the memorandum of association of Mvelaserve. the combined meeting of Mvela Group shareholders convened. 29 November 2010. dated 27 October 2010. Nedbank Limited (registration number 1951/0000009/06). and wholly-owned by Mvelaserve. to vote on the special and ordinary resolutions required to implement the Unbundling. which is expected to be on or about Monday. 18 November 2010. which. enclosed and posted in the same envelope with this Pre-listing Statement. Mvelaphanda Holdings (Proprietary) Limited (registration number 1999/011391/07). Mandated investments include investments by pension funds and unit trusts. a public company duly incorporated and registered in South Africa. “Mvelaserve” “Mvelaserve Group” or “Group” “Mvelaserve Ordinary Shares” or “Ordinary Shares” “Mvelaserve Ordinary Shareholder” “NAV” “Nedbank Limited” or “Nedbank” “New Companies Act” Mvelaserve Limited (1999/003610/06). a public company duly incorporated in South Africa. Johannesburg at 10:00 on Thursday.

the Securities Exchange News Service of the JSE. No. and Protea Coin Group (Assetsin-transit and Armed Reaction) (Proprietary) Limited (registration number 1999/003646/07). and the sale of Mvelaserve Group’s investment in Stamford Sales to Mvela Group. Registered Accountants and Auditors. as detailed in Annexure 1 to this Pre-listing Statement. including the acquisition of Zonke by Mvelaserve from Mvela Group. a private company duly incorporated in South Africa. No. being the reporting accountants and auditors of Mvelaserve. or who wish to acquire Mvelaserve Ordinary Shares after the Listing. private companies duly incorporated in South Africa. and wholly-owned by Mvelaserve. as amended. “PSIRA” “Rand” or “R” “Record Date” Private Security Industry Regulatory Authority of South Africa. the restructuring activities prior to the Listing Date. Rebhold Distribution Services (registration number 1987/000472/07). “Restructuring” “Royalserve Catering” “Royalserve Cleaning” “SABS” “SARB” “Securities Services Act” “SENS” “Stamford Sales” “STC” 13 . a private company duly incorporated in South Africa. Secondary Tax on Companies levied in terms of section 64B of the Income Tax Act or any similar taxing provision. South Africa Bureau of Standards. 3 December 2010 or such date as may be later amended. in terms of the Securities Services Act. the last date on which Mvela Group Ordinary Shareholders are required to be recorded in the register as such in the Mvela Group register in order to participate in the Unbundling. charged with the responsibility of overseeing and regulating the gambling industry in South Africa. 71 of 2008. a private company duly incorporated in South Africa. settlement of all inter-company loans between Mvelaserve Group and Mvela Group. the Companies Act. as amended. a regulatory board established by the National Gambling Act. which is expected to be the close of business on Friday. “New Companies Act” “Participant” “PKF” “Pre-listing Statement” “Prospective Investor” “Protea Coin” or “Protea Coin Group” collectively. as amended. Chartered Accountants (SA) (registration number 1994/001166/21). a central securities depository participant. this pre-listing statement and its annexures. dated 27 October 2010. No. the lawful currency of South Africa. Royalserve Cleaning (Proprietary) Limited (registration number 2000/011155/07). and wholly-owned by Mvelaserve. which has been promulgated and will eventually replace the Companies Act upon coming into force. investors who will acquire Mvelaserve Ordinary Shares as a result of the Unbundling. a company duly incorporated in South Africa. South African Reserve Bank. 36 of 2004. 7 of 2004. Royalserve Catering (Proprietary) Limited (registration number 1994/005030/07).“NGB” the National Gaming Board. Protea Coin Group (Technical and Physical Security) (Proprietary) Limited (registration number 1999/001641/07). the Securities Services Act. PKF (Jhb) Inc. and wholly-owned by Mvelaserve.

being the holding company of the companies operating under the TFMC brand. and the acquisition of 75% of the issued share capital of Zonke from Mvela Group by Mvelaserve. a private company duly incorporated in South Africa. “Strate System” “Subsidiary” “Telkom” “TFMC” “Transfer secretaries” “Unbundling” “VAT” “Zonke” or “Zonke Monitoring Systems” “Zonke acquisition” 14 . as amended or replaced from time to time. managed by Strate. a public company duly incorporated in South Africa. and wholly-owned by Mvelaserve. Zonke Monitoring Systems (Proprietary) Limited (registration number 2000/017501/07). a subsidiary as defined in the Companies Act. of Mvelaserve Ordinary Shares. value-added tax levied in terms of the South African Value-Added Tax Act. the proposed distribution by Mvela Group to Mvela Group ordinary shareholders.“Strate” Strate Limited (registration number 1998/022242/06). following the Listing. equating to 100% of the entire issued ordinary share capital of Mvelaserve. a clearing and settlement environment for security transactions to be settled and transfer of ownership to be recorded electronically. and seventy-five percent (75%) owned by Mvelaserve after the Restructuring. a private company duly incorporated in South Africa. a private company duly incorporated in South Africa. TFMC Holdings (Proprietary) Limited (registration number 2000/001009/07). Computershare Investor Services (Proprietary) Limited (registration number 2004/003647/07). as fully described in Annexure 1 to this Pre-listing Statement. 1991 (Act 89 of 1991). which will be implemented in terms of section 46 of the Income Tax Act. Telkom SA Limited (registration number 1991/005476/06). being the company responsible for operating the electronic settlement system for transactions that take place on the JSE and off-market transactions. a public company duly incorporated in South Africa whose shares are listed on the JSE.

entrepreneurial. Mvelaserve has a decentralised management structure to afford substantial autonomy to the business units where the focus is on organic growth as well as expansion of its service offerings. catering and cleaning. • leadership and support from an experienced team of corporate executives. security. It also provides services in the gambling. words importing one gender shall include the other genders and references to persons shall include juristic persons and vice versa. • maximising cross-selling opportunities via the client relationship management system developed by the corporate office. • strong financial management and operating systems at subsidiary level. The Group operates four business units. words in the singular shall include the plural and vice versa. • security. • diversification of service offerings. 15 . unless otherwise stated or the context clearly indicates otherwise. pie manufacturing. Mvelaserve offers a wide range of integrated services in the areas of facilities management.Mvelaserve Limited (Incorporated in the Republic of South Africa) (Registration number 1999/003610/06) JSE Share code: MVS ISIN: ZAE000151353 (“Mvelaserve” or the “Group”) PRE-LISTING STATEMENT In this Pre-listing Statement. with a strong focus on corporate governance practices. • catering and cleaning. experienced and decentralised operational management. the words in the definitions and interpretations section shall have the meanings stated therein. NATURE OF BUSINESS Mvelaserve is a leading provider of integrated outsourced business support services in South Africa through its network of operating subsidiaries. franchising and freight markets. Mvelaserve’s operating principles are: • autonomy of the individual subsidiaries under skilled. PART A:THE BUSINESS OF MVELASERVE 1. namely: • facilities management. Mvelaserve’s intention is to become the leading provider of integrated outsourced business support services to South Africa and the rest of the continent. and • diversified services. and • group procurement activities. employing approximately 30 000 people.

• Organic expansion Mvelaserve intends to penetrate new markets leveraging off its BEE platform and client base. • Proven financial performance Mvelaserve has consistently achieved significant year-on-year growth. • entrenched cross-selling capability. • leading position in attractive markets. • Improving market positioning Mvelaserve aims to maintain its recognised leadership status in the integrated outsourced business support services markets. • strong portfolio of blue chip clients. margin enhancement and increased profitability. • diversified offering of outsourced services. MVELASERVE’S STRATEGIES FOR GROWTH Mvelaserve services a broad range of companies in various sectors. empowering the management teams of each subsidiary and seeking to maximise shareholder returns. This will be achieved by: • Optimising profitability of established businesses Mvelaserve intends to continue its ongoing business optimisation programmes. • established national footprint. • preferred supplier status in many industries.4% BEE shareholding including Mandated Investments). Mvelaserve continually seeks opportunities to further strengthen its position as a market leader and is confident that the Group is well-positioned to benefit from recovering economic growth in South Africa and the rest of the continent. Mvelaserve has an effective 68. with a proven track record. • long-standing business relationships. • consistently strong corporate governance practices.5% BEE shareholding excluding Mandated Investments (45. entrepreneurial and skilled senior management. Immediately after the Listing and Unbundling. financial. Mvelaserve’s strategy is to continue to grow and build the business into the recognised leader of integrated outsourced business support services in South Africa and the rest of the continent. strengthening margins. • Operational advantages Mvelaserve’s operational advantages include. inter alia: • well established. Mvelaserve will have the same shareholder profile as Mvela Group. recognised brands. including both private sector and government organisations. giving it an equally strong BEE ownership percentage. It has a balanced client portfolio. • experienced. KEY STRENGTHS Mvelaserve’s key strengths include: • Balanced business portfolio Mvelaserve has a balanced portfolio across its markets and regions of operation. and • thorough understanding of the markets in which it operates. mining. retail. The Group is well positioned to benefit from the growth of these and other industries once positive sentiment returns to the global and local economy.2. 16 . telecommunication and construction. including infrastructure. • committed and loyal workforce. This has resulted in strong cash flows and improved returns to shareholders. • Empowerment credentials Currently as a result of the 100% shareholding by Mvela Group. public sector. 3.

cleaning and other diversified services. During this time the businesses of Royal Food Services (Proprietary) Limited and Stamford Sales were acquired. The cleaning business was strengthened with the acquisition of the Berco Cleaning and Mediguard brands in 2001. These businesses included JIC Mining Services (Proprietary) Limited. Protea Security Services and Mining Residential Services (Proprietary) Limited. Rebhold grew both organically and by acquiring businesses in its key areas of expertise. In August 1999. South Africa. Trollope Mining Services (Proprietary) Limited. In 2000 it was converted to a public limited liability company and its name was changed to Rebserve Limited (“Rebserve”). 17 . food and freight forwarding industries. catering. In 2005 its name was again changed to “Mvelaserve”. food services and support services to the corporate. to create one of the leading wholesale and distribution groups in South Africa. The registered address and head office of the Company is 28 Eddington Crescent. From 1997 to 1998. and developed a strategy to create South Africa’s leading services group through its wholly-owned subsidiary Rebserve. History 1995 – 2003 Rebhold Holdings Limited (“Rebhold”) was incorporated in South Africa on 12 May 1995 under the name Gainer Investments (Proprietary) Limited as an investment holding company. with the name Lexshell 296 Investment Holdings (Proprietary) Limited and registration number 1999/003610/07. TFMC was established in 2000 through the outsourcing of the property and facilities management functions of Telkom as a joint venture between WS Atkins plc. recognised brands to expand the footprint on the rest of the continent. Mvela Group then positioned itself as South Africa’s foremost black-controlled. and its principal activity. is to act as an investment holding company to a number of subsidiary companies that provide outsourced business support services in the areas of facilities management. and in 2004 the merged entity was renamed “Mvelaphanda Group”. • Expanding the Group’s footprint into the continent of Africa Mvelaserve aims to leverage off its well established. 2004 – 2008 In December 2003 Rebhold and Mvelaphanda Holdings merged certain of the businesses and assets of Mvelaphanda Holdings and Rebserve. Rebserve acquired the business of Coin Security and in November 1999 agreement was reached with Molope Group Limited (“Molope”) for Rebserve to acquire certain profitable services businesses from Molope. Rebhold held investments in businesses which covered a diversified range of distribution activities primarily in the liquor. In 2003. a support services group based in the United Kingdom. 4. the outsourced catering business. INCORPORATION AND HISTORY Mvelaserve was incorporated and registered in South Africa in 1999 as a private limited liability company under the Companies Act. By 2001 Rebserve had become a leading outsource services group in South Africa which offered a comprehensive range of facilities management. Highveld Technopark. Rebhold identified the services sector as one which offered good growth prospects while generating strong cash flows. professional services. Mvelaserve has not changed its name in the last three years preceding this Pre-listing Statement. owned and managed diversified services group. Rebhold had already developed an expertise in operating services businesses through its food services and freight forwarding businesses which had been acquired at the time of the initial public listing in 1996. and Rebserve. Centurion. Zonke won the NGB’s sole CEMS contract in November 2003. technical services.• Growing through strategic acquisitions Mvelaserve seeks to grow through investing in businesses with the potential to enhance the current service offering while growing free cash flow and return on investment. Khuseti Holdings (the holder of the master franchise of the King Pie brand) was acquired in 1999. which was incorporated on 19 February 1999. 0169. industrial and mining sectors.The business of the company.This will initially be achieved by following the Mvelaserve client base and establishing separate decentralised businesses with select local partners in the target countries. security. Rebserve acquired Sechaba Afrika (Proprietary) Limited. mining services.

18 . which were previously managed separately with no cross-selling of services.TFMC became a wholly-owned subsidiary of Rebserve in 2004 after WS Atkins plc disposed of their interest in the joint venture. The board of directors of Mvela Group concluded that a listing of the Mvelaserve Ordinary Shares on the JSE. were merged under one operating entity. Mvela Group announced to its shareholders that it would pursue a process of unlocking value for its shareholders in the most efficient manner. With effect from 23 December 2005. This was done to provide greater autonomy to the major outsourcing business units where the focus would be on the organic growth of existing service offerings and client bases. catering and cleaning and diversified services were established. security. namely Protea Coin. assets-in-transit. In September 2009. the board of directors of Mvela Group considered different alternatives to realise value from its investment in Mvelaserve. risk management and technical security solutions. ensuring continued growth of Mvelaserve and its Subsidiaries. GROUP STRUCTURE AND BUSINESS UNITS 5. 5. As part of this process. In October 2009 the businesses of Royal Sechaba and Mvelaserve Cleaning were merged under one management team and the name was subsequently changed to Royalserve operating under the brand names of Royalserve Catering and Royalserve Cleaning.1 Group structure The following chart provides an overview of Mvelaserve’s operational structure subsequent to the Restructure on the Last Practicable Date: Mvelaphanda Management Services* 100% 100% 100% 100% 100% 100% 75% Facilities Management Security Cleaning and Catering Diversified Services Mvelaphanda Management Service is the company secretary of Mvelaserve Group. the Rebserve changed its name from Rebserve to Mvelaserve Limited. including integrated guarding services. and the unbundling by Mvela Group of all of its Mvelaserve Ordinary Shares to Mvela Group Ordinary Shareholders would best serve the interests of its shareholders. armed reaction. In 2008 Mvelaserve undertook a restructuring whereby the current divisions of facilities management. The merger of the two security businesses was a strategic move to create an entity capable of offering an integrated set of security services to the South African market. as detailed in the “Corporate Information” section of this Pre-Listing Statement. In 2007 the businesses of Protea Security and Coin Security. 2009 In June 2009 Mvelaserve was used as the vehicle to manage the operating entities separately from Mvela Group and a separate management team was established in Mvelaserve to lead and support the Subsidiaries.

Security. Financial information for year ended 30 June (R million) 2010 2009 Business Consolidated Description • corporate head office located in Centurion.9% 756 21. and Diversified services. specialised healthcare cleaning.0% 1 108 31.5% 132 3.8% 1 263 37. on a pro forma basis and include the results of Zonke.6% 188 50. and central kitchen facilities Diversified Services • franchisor of the King Pie brand and owner of BMO Food Services which manufactures the King Pie product range • freight forwarding and customs clearance agents for the import and export markets • branches in Johannesburg.4% 174 38.9% 29 6.5% 39 10.5. strategy support. 19 .2 Business Units Mvelaserve has a well-balanced and diversified portfolio of businesses servicing many different industries and geographies. which was acquired by Mvelaserve subsequent to 30 June 2010 in terms of the Restructuring. Cape Town and Durban • monitors the LPM industry in South Africa in terms of a contract signed with the NGB Revenue % group revenue EBITDA % group EBITDA Revenue % group revenue EBITDA % group EBITDA Revenue % group revenue EBITDA % group EBITDA 159 3.2% 5 1. and industrial cleaning services • catering which focuses on contract food solutions. procurement and risk management Consolidated revenue Consolidated EBITDA (excluding head office costs) 4 112 448 3 509 371 Facilities Management • the largest facilities management company in South Africa • specialises in infrastructure project support services Security • a market-leading provider of integrated security solutions • specialises in asset-in-transit security and guarding Cleaning and Catering • cleaning which focuses on contract cleaning.1 Facilities Management – TFMC Overview TFMC is the largest facilities management company in South Africa by square metres covered.1% 50 1.9% 179 40.8% 176 5.2.1% Revenue % group revenue EBITDA % group EBITDA 1 088 26.7% 5. responsible for the Group.7% 153 4.5% 19 5. South Africa.5% 40 8.1% 106 28.2% 21 4. providing comprehensive facilities management services.6% Revenue % group revenue EBITDA % group EBITDA 1 106 26.0% 5 1.5% Revenue % group revenue EBITDA % group EBITDA 1 577 38. Revenue and EBITDA totals are provided for the year s ended 30 June 2010 and 30 June 2009.4% 14 3. Cleaning and Catering.3% 53 1. The following table illustrates Mvelaserve’s businesses with its four business segments: Facilities Management.

Customised Solutions is well positioned to grow in this market sector. 365-days per year basis. • positive record with employees and trade unions. with a total workforce of over 16 000 employees. 11 435 masts and all ancillary telecommunications infrastructure. Kumba Iron Ore Limited and South African Bureau of Standards. With the development of large infrastructure projects in South Africa and on the rest of the continent. the Customised Solutions pipeline is full of opportunities. accounted for approximately 89% of its revenue for the year ended 30 June 2010.3 million square metres).2 Security – Protea Coin Protea Coin is the leading provider of integrated risk reduction solutions to various industry sectors throughout South Africa. The business has a national footprint across 32 regional offices. and • national experience with an extended scope of services offered over the entire footprint of South Africa. In line with Mvelaserve’s strategy to use the existing contract base to grow new business.TFMC aims to selectively grow differentiated businesses to build a portfolio of strong client partnerships in the private and the public sectors. • Telkom – TFMC’s main client. A focus on these opportunities should enable TFMC to reduce its reliance on the agreement with Telkom. processing over 22 500 transactions daily. • extensive management and employee resources. • leading integrated information technology service platform (SAP) with transportable processes which can integrate with local operating platforms. and maintenance. • extensive intellectual property associated with the Telkom agreement. yielding sustainable profits and cash by using systems and expertise developed from first-order facilities management outsourcing in the telecommunications industry. TFMC has had extensive experience and intellectual property through its contract with Telkom. The division has 30 depots on a national level. 135 retail sites. Total integrated facilities management services provided to Telkom include facilities management. professional engineering services and project management. An integrated cash management and electronic cash acceptance device division complements the AIT services resulting in a packaged solution offering to clients that also include short-term insurance cover. including the Department of Trade and Industry. Protea Coin operates through three primary divisions: • Assets-in-transit (“AIT”) – services include bulk cash transportation. with a fleet of more than 450 state-of-the-art armoured vehicles. The business is comprised of two divisions. Telkom. corporate real estate management.2. • financial capacity and capability. namely Telkom and Customised Solutions. Customised Solutions also has various clients in the infrastructure project support services sector which supplies catering and facilities management services to clients in remote sites and to clients requiring catering and village management services in support of major infrastructure projects. Cell C (Proprietary) Limited. 20 . Many of these facilities are mission critical to Telkom and are maintained on a 24-hour. The main customers of AIT are banks and cash retailers. 5. In July 2010. TFMC provides total integrated facilities management services to Telkom in respect of 1 979 sites with a total of 8 000 properties (in excess of 2. establishing it as the preferred facilities management service provider to Telkom. Mvelaserve (through Mvela Group) announced an extension of its agreement with Telkom for the period 1 April 2011 to March 2016. ATM management and valuable assets transportation. Clients that are being serviced under Customised Solutions comprise clients from a wide range of sectors. • Customised Solutions – other facilities management contracts are grouped under Customised Solutions. The new agreement was signed in August 2010. TFMC’s key strengths include: • demonstrated ability to deliver value for money and improvements in service levels with associated cost savings for clients. daily banking and deposit services.

In addition. and • Remote site catering – project catering in remote sites in South Africa and Mozambique. access control to mining facilities. Protea Coin’s competitive advantage of being one of three national AIT providers. combined with its track record in mining security and a large base of clients in the guarding division has facilitated the seamless integration of security solutions to a portfolio of blue-chip clients in South Africa and has resulted in higher operating margins being earned. canine and equestrian units. monitored by a national control centre facility. installation and monitoring of high-technology surveillance security solutions. special investigations unit. • Royalserve Cleaning – the third largest cleaning company in Southern Africa. which operates a fully fledged security service provider employing in the region of 3 000 security personnel. tertiary education.C. industrial and corporate sectors across Southern Africa. mining.This division also has the capability for state-of-the-art access control with time and attendance interface through its recent acquisition of SACO systems. it has a special events division and food preparation facilities.The core business is the provision of contract catering services to. 5.L. providing specialised security solutions to the mining sector including the security around prime product. an equestrian unit. surveillance and crime prevention (especially illegal mining). • Technical – entails the design. Royalserve Catering is the third largest contract caterer in South Africa by turnover. housekeeping and back-of-house functions. The business unit operates under two main divisions. The national control centre further allows for the development of disaster recovery and emergency planning facilities for clients.3 Cleaning and Catering – Royalserve Royalserve is a specialist contract cleaning and outsourced food services company. bullion/product transportation (road and air). close protection.2. education and industrial.• Guarding – manned guarding services to the private and public sector with value-added services such as a specialised reaction unit. Royalserve Catering services the market through three business units: • Contract food solutions – supply of outsourced food solutions to work forces across all market sectors. offers cleaning solutions in all major centres of South Africa and Namibia. RFID and 3VR facial recognition forms part of this portfolio. Royalserve Catering and Royalserve Cleaning: • Royalserve Catering – an outsourced food solutions company. • largest security service provider to the mining industry. hospitality. education and industrial facilities on a national basis. Clients cover a multitude of sectors including corporate. and risk management consulting to the mining industry. asset-in-transit vehicle crews and armed security officers. In addition to these core offerings. Protea Coin is a market leader in mining guarding services. Royalserve Cleaning has three divisions each focused on a specific market: • Contract Cleaning and Hospitality – provides cleaning services to commercial.The division also provides integrated solutions to the hospitality and leisure industry including front-of-house. the critical situation unit. a canine unit. Protea Coin also acts as a security consultant on an international basis. and a cargo risk management solution unit. Specialising in the education and healthcare sectors. and • market leader in AIT services in South Africa. Protea Coin’s key strengths include: • seamless integration of security solutions to a portfolio of blue-chip clients. inter alia. commercial. This training includes the grading of security officers in terms of PSIRA regulations. Protea Coin offers investigations and intelligence services. healthcare. from high-end executive dining to factory worker catering. more specifically in Nigeria and in the United Arab Emirates through a 49% shareholding in Al-Jaber Coin Security Group L. • Central kitchen – a state-of-the-art food production kitchen in Centurion to service the contract food solutions and large infrastructure clients. aviation security and fleet monitoring services. training for the specialist divisions such as the VIP protection unit. Protea Coin has its own specialised training facilities to provide training to the security officers employed in these businesses. retail. the healthcare. 21 .

2. Khuseti earns the following types of revenue: • royalties/management service fee received from franchisees – dependent on the number of franchises and revenue earned by the franchisees. chips. Mozambique. Royalserve’s strategy is consistent with that of Mvelaserve by using the existing revenue base as a platform to strengthen partnerships and accelerate operating margin growth through the development of higher margin offerings. doctors’ rooms. many being qualified nursing sisters.2.• Healthcare Cleaning Services – market leader in specialised cleaning services to hospitals. Khuseti’s key strengths include: • state-of-the-art manufacturing facility. and • Industrial Cleaning – operates high-pressure blasting machines to facilitate the cleaning of plant and equipment in the petrochemical. • state-of-the-art central kitchen to supply all catering business units. King Pie outlets come in various sizes including King Pie Express (kiosk). BMO Food Services has recently started bulk distribution of pies to selected retail and convenience outlets around the country. Swaziland and Zambia. The company focuses exclusively on franchisor activities and all outlets are owned and operated by franchisees. paper. Entrepreneurial management and small to medium businesses in highgrowth sectors characterise this business unit. to increase its market share of this business unit and its various divisions. muffins and other confectionery products. and • export capabilities. Royalserve has a strong market position and intends to use the existing base of national public and private clients. The pies are primarily distributed to the King Pie Holdings franchises. • initial joining fee and design fee levied on new franchisees. and • focus on employee and skills development to ensure excellence in service. clinics. King Pie Holdings has over 300 outlets in South Africa. 22 .Their experience provides this division with intricate knowledge of the healthcare working environment. and • revenues generated from the sale of pies to the King Pie franchisees and other retailers. which cannot be cleaned by conventional cleaning methods. • award-winning franchising. Namibia. fishing and wine industries. semi-mechanised manufacturing facility in Midrand. The King Pie product offering consists mainly of puff pastry pies which are complemented by cooldrinks.1 Khuseti Khuseti is the franchisor of the King Pie Brand and the owner of BMO Food Services which manufactures the King Pie product range. Managers are recruited directly from the healthcare industry. frail-care centres and retirement homes in South Africa. Royalserve’s key strengths include: • third largest cleaning service provider in South Africa with well-established brands. BMO Food Services manufactures the King Pie product range. The companies in this business unit are as follows: 5. King Pie Cafe (sit-down offering) and King Pie 2 Go (medium-sized take-away with limited seating). with further outlets in Botswana.4. using a newly built state-of-theart.4 Diversified Services Diversified Services’ strategy is to generate free cash flow in order to increase capital available for the further growth of Mvelaserve. 5. • respected and recognised brand. and is currently in negotiations with a number of the large retail chains.

5.2.4.2

Zonke Zonke is the sole provider of the CEMS for the LPM industry in South Africa. The monitoring of the LPM industry became effective in June 2003, due to legislation requiring this industry to be monitored. Monitoring is governed by the National Gambling Board and is contracted out to Zonke. The fees and tariffs charged by Zonke as the CEMS operator are based on the gross gaming revenue (“GGR”), which is the Rand value of the difference between total bet and total win (including VAT and gambling tax) i.e. total cash or credits played less winnings paid to players. The route operators (the companies licensed to own and operate LPMs) pay these fees directly to Zonke. Zonke also sells smart cards to the route operators. Only licensed operators can be in possession of a smart card, without which the activation of machines on site is not possible. Data is collected directly from the premises of the site operators (the companies on whose premises the LPM’s are operated) by dial up communication with the site data logger (“SDL”), which monitors all activities on the machines on site and enables play on the machines. The SDL is sold on a once-off basis to the route operator, who then installs it on site, with each SDL linking to a maximum of five machines. Zonke earns the following types of revenue: • monitoring fees, which are percentage based on GGR generated by each LPM in operation; • sale of SDL and smart cards to the route operators; • hardware and software maintenance contract fees; and • fees for training and other maintenance on equipment. The CEMS contract was initially awarded on the basis of monitoring 50 000 LPM’s throughout South Africa. However, as at 30 June 2010 only about 5 500 LPM’s were in operation. This is due to the slower than anticipated awarding of new LPM licences in the various provinces, particularly in Gauteng. The roll out of LPM operator licences is gaining momentum and it is expected that this will further improve the profitability of Zonke going forward.

5.2.4.3

Contract Forwarding Contract Forwarding is a medium-sized international freight forwarding and customs broker, boasting full facilities in Johannesburg, Durban and Cape Town. Contract Forwarding is a fully accredited IATA (International Air Transport Association) cargo agent and a member of SAAFF (South African Association of Freight Forwarders). The company is one of two South African members of Feta Freight Systems International (“FFSI”), a worldwide network of over 90 companies in over 65 countries. All members of FFSI are required to maintain the highest levels of professional service to all partners and clients in order to retain their membership and are constantly evaluated on their performance. Contract Forwarding provides the following services to its clients: • forwarding through its international network of agents; • international sea freight and airfreight imports and export services; • customs consultancy – assistance in determining correct customs value and tariff heading; • customs clearance services; and • freight warehousing in a company-operated warehouse equipped with mechanical handling facilities. Revenue is received from performing international freight forwarding and customs clearing services. Revenue is not contractual and is receivable once the service is performed. The revenue is dependent on the level of activity related to the importing and exporting of goods, which is affected by the broader economy of South Africa.

6. MAJOR AND CONTROLLING SHAREHOLDERS Mvelaserve has been a wholly-owned subsidiary of Mvela Group since 2004, as set out in paragraph 4 above. The registered office of Mvela Group is 1st Floor, 30 Melrose Boulevard, Melrose Arch, Johannesburg, 2076. There has been no change in controlling shareholders of Mvelaserve and its subsidiaries in the past five years. Following the Unbundling, there will be no controlling shareholder in Mvelaserve.

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Immediately following the Unbundling, Mvela Group Ordinary Shareholders will hold Mvelaserve Ordinary Shares in proportion to their shareholdings in Mvela Group. Consequently, based on the provisional entitlement ratio of 25 Mvelaserve Ordinary Shares for every 100 Mvela Group Shares, the Mvelaserve Ordinary Shareholders other than directors, that will directly or indirectly beneficially hold approximately 5% or more of the Ordinary Shares, immediately after the Unbundling (based on their Mvela Group shareholdings at the Last Practicable Date), will be as follows: Number of Ordinary Shares held6 Direct Mvelaphanda Holdings1 Clidet 603 (Proprietary) Limited2 Mvelaphanda Treasury and Finance (Proprietary) Limited3 CoroLife Special Opportunities Portfolio4 Indirect Mvelaphanda Empowerment Trust5 Total
Notes: 1. The shareholders of Mvelaphanda Holdings are as follows: 1.1 TJS Family Trust (Beneficiaries: T M G Sexwale, J A Sexwale, C M Sexwale and G M Sexwale). 1.2 Matimba Trust (Beneficiaries: W Willcox, M J Willcox and L MacKenzie). 1.3 Dikela trust (Beneficiaries: S Xayiya, B Xayiya, M S M Xayiya and N Maquto). 1.4 Mvelaphanda Empowerment Trust (Beneficiaries: G M Sexwale, C M Sexwale and any other natural person as selected by the trustees). 1.5 Mvelaphanda Investment Trust (Beneficiaries: W Willcox, M J Willcox and L Mackenzie). 2. 100% held by Mvelaphanda Holdings. 3. 100% held by Mvela Group. 4. A fund administered by Coronation Fund Managers. 5. Held via Mvelaphanda Holdings. 6. The number of Ordinary Shares held is based on an assumed entitlement ratio of 25 Ordinary Shares for every 100 Mvela Group Shares.

Percentage of Ordinary Shares in issue

16 000 000 9 938 163 8 941 321 5 928 280 8 002 920 48 810 683

11.3 7.0 6.3 4.2 5.7 34.5

Save as indicated above and as at the Last Practicable Date, the Directors are not aware of any shareholder or Director who is, directly or indirectly, beneficially interested in approximately 5% or more of the issued share capital of Mvela Group, and hence Mvelaserve. There has been no change in control of Mvelaserve in the five year period preceding the date of this Pre-listing Statement. 7. PROSPECTS The outsourced support services industry in South Africa is intrinsically linked to the growth in global gross domestic product (“GDP”) as well as South African GDP, particularly as it relates to business and consumer growth. After the adverse economic conditions created by the global financial crisis experienced in the past two years, South Africa appears to be on the path to economic recovery. However, the rate thereof remains uncertain. Improved fundamentals of a lower interest rate, and lower inflation environment, and improved consumer demand will assist in speeding up the recovery. It is the opinion of the Directors that as primarily business-to-business outsourced support service providers, with some exposure to the consumer market, Mvelaserve was not adversely affected by the global financial crisis in the past two years and is well positioned to take advantage of further economic growth in South Africa and the rest of the continent. The Group will continue to seek to partner with clients in the management of their assets, affording clients the room to concentrate on their core business, while Mvelaserve delivers a value-for-money basket of non-core services. Mvelaserve will with strategic acquisitions, internal development and internal growth improve service offerings to its client base. 8. RATIONALE FOR LISTING The Directors believe that the Group has the operational and financial capacity to pursue its intended vision and mission independently. The Listing will allow the Group to achieve the following: • enhance Mvelaserve shareholder value; • enhance the public profile and general public awareness of Mvelaserve;

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• provide Mvelaserve with a further source if required, from which capital can be raised, to facilitate future expansion; and • afford institutions, private clients, other business associates of Mvelaserve and members of the public the opportunity to participate directly in the equity of Mvelaserve. 9. KEY INVESTMENT CONSIDERATIONS The Directors believe that the Listing presents the following key investment considerations: • leading positions in facilities management, security, catering and cleaning industries in South Africa; • experienced, entrepreneurial management team supported by skilled industry experts; • operational excellence using specialist skills in integrated facilities management, AIT and healthcare cleaning; • rapidly growing client base both in the private and public sector; • national footprint, with some presence in selected international markets; • impressive and proven track record by management in the services industry; and • solid BEE credentials. 10. BLACK ECONOMIC EMPOWERMENT BEE is a central part of the South African Government’s economic transformation strategy. A multi-faceted approach to BEE has been adopted which aims to increase the number of black people that manage, own and control South Africa’s economy. The three core elements of the South African Government’s BEE policy are: direct empowerment through ownership and control of enterprises and assets; human resource development and employment equity; and indirect empowerment through preferential procurement policies aimed at ensuring that black people benefit from South African tenders. Several industries have taken the initiative to set their own specific targets related to, inter alia, the three core areas of BEE. These initiatives have been incorporated in transformation charters. Each transformation charter contains a scorecard against which industry members are measured on their BEE progress. The scores achieved are important in competing and tendering for business from the public and private sectors. The scorecards have a cascading effect, with each commercial enterprise requiring a measure of BEE compliance from enterprises with which they do business, in order that they too can reach their BEE targets. Mvelaserve is addressing its BEE credentials and initiatives to maximise the BEE scorecard points achieved by the Group, including maximising the “bonus points”, in terms of the Codes. Maximising the BEE scorecard points is a clear indication of Mvelaserve’s commitment to BEE, and is an important element in securing new business and contracts for Mvelaserve’s subsidiaries and positions Mvelaserve as the BEE supplier of choice in the industries in which it operates. Prior to the Listing, the Company is 100% owned by Mvela Group, an investment holding company listed on the JSE. As at 26 March 2010, Mvela Group underwent an independent BEE equity verification process, which placed the BEE shareholding of Mvela Group at 68.5%, excluding Mandated Investments. This translates to an effective 45.4% BEE shareholding of Mvelaserve, including Mandated Investments. The anchor BEE shareholder of Mvela Group is Mvelaphanda Holdings with a direct holding of 19.3%. All the Mvela Group shareholders will receive the proportionate shareholding in Mvelaserve upon implementation of the Unbundling. Post the Listing, Mvelaserve will commission its own independent BEE verification process. 11. INFORMATION TECHNOLOGY Mvelaserve has established an in-house information technology (“IT”) service provider under the leadership of the technical division within Protea Coin. This in-house service provider has a team of permanent IT technicians available to service various needs, including, but not limited to, maintaining the anti-virus programmes, firewalls and adequate backup systems and procedures, of the various subsidiaries on a daily basis. The Group relies on SAP, AccPac and Pastel for its accounting needs and reviews the usage of the software programmes on a regular basis. Where necessary the usage of the software programmes is modified to suit the Group’s specific needs. The Mvelaserve head office ensures that there is adequate information security and data integrity at each of the subsidiaries via correct risk management programmes and internal audit processes.

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canine and equestrian units. while comprehensive and effective training also supports the fast-tracking of HDSA employees up the management ladder.8% 8. Mvelaserve’s operating businesses offer vocational and specific skills-based training to their employees. This drive is underpinned by the development and training of employees from previously disadvantaged backgrounds to ensure that Mvelaserve will continue to be representative of the demographics of South Africa.12. • introduction of measures and procedures for transformation. amongst others. • Protea Coin Protea Coin has specialised training facilities to provide training to its security officers. cleaning and catering. business processes and human behaviour in organisations has also been developed. use of alternative cleaning materials and specialised cleaning techniques. EMPLOYEES The Subsidiaries of Mvelaserve operate in labour intensive industries including security. on-site training programmes. including manager and supervisor development. special investigations unit. customer service. communications. respectively: Financial year ended 30 June HDSA Non-HDSA Total employees 2010 27 947 2 207 30 154 92. as well as functional training in a range of subjects. A management development programme. operation of in-house training facilities. Details of the specific training initiatives of Mvelaserve’s largest operations are set out below: • TFMC TFMC provides comprehensive training programmes for its employees. The following table sets out the number of employees of the Group.0% 2008 23 659 2 101 25 760 91. This training is essential to maintaining the high quality of service and expertise that has made many of Mvelaserve’s operating businesses leaders in their industries.3% 2009 24 656 2 145 26 801 92.2% Mvelaserve strives to be an employer of choice among workers and a leader in the development of human resources and human capital. and • reduction of barriers to advancement of the disadvantaged. for the financial years ended 30 June 2010. Royalserve Catering also provides training on basic cooking skills. 26 . • promotion of employee diversity. participation in Mvelaserve and industry training and learnership programmes. hazard analysis and critical control point (“HACCP”) procedures compliance.7% 7.The formal structures established for training include. which range from competency training for technicians. occupational health and safety. TRAINING PROGRAMMES Having the appropriately skilled people at all levels is crucial to Mvelaserve’s long-term success. • Royalserve Royalserve Cleaning operates dedicated training teams. health and safety training for Occupational Health and Safety representatives.0% 8. The training includes the grading of security officers in terms of PSIRA regulations. 13. teambuilding. AIT vehicle crews and armed security officers. Mvelaserve remains committed to the principles and spirit of the Employment Equity Act and firmly endorses the four key areas of employment equity identified by the Employment Equity Act. training for the specialist divisions such as the VIP protection unit. Royalserve Catering provides training courses that cover a wide range of subjects. 2009 and 2008. which provides training to middle management on business management techniques for problem-solving. namely: • elimination of discrimination in decision-making. These teams provide on-site training to employees on subjects such as the use and operation of cleaning equipment. and nutrition and dietaryrelated courses. accounting for a large workforce. The healthcare division provides specialised training in the field of infection control and health management issues.

caring for children and abused women and HIV/Aids support. The rights which are recognised and protected in terms of the PSIRA Act are the fundamental rights to life and security of person as well as the right not to be deprived of property. so as to ensure that there is greater safety and security in the country. The purpose of the CEMS Operator is to monitor LPM’s. No. and sufferers of these illnesses are referred to independent medical and counselling service providers when required. and provide a level playing field for all participants in the LPM industry. CORPORATE SOCIAL INVESTMENT The corporate social investment (“CSI”) initiatives of Mvelaserve extend countrywide and seek to improve the lives of numerous communities across South Africa. confidentiality of medical information and disclosure of HIV status. Private Security Industry Regulation Act. and has the responsibility to carry out its responsibilities in accordance with the Gambling Act and the directives of the NGB. All employees are briefed on the rights of those suffering from HIV/Aids or other life-threatening diseases. Further. It is recognised in terms of the PSIRA Act that security service providers and the private security industry in general play an important role in protecting and safeguarding the aforesaid fundamental rights and the PSIRA Act. Mvelaserve is subject to certain legislation and regulations. These worthy initiatives are mostly in the areas of education. Mvelaserve has accordingly adopted a policy on life-threatening diseases aimed at preventing discrimination against HIVpositive employees in the workplace. The principal parties in the establishment and operation of the CEMS for LPM’s is the NGB and the CEMS Operator. Mvelaserve recognises that the HIV/Aids pandemic is likely to have an impact on the Group. Certain of Mvelaserve’s businesses are reporting increased levels of staff illness.This policy lays down universally accepted guidelines regarding HIV testing. REGULATORY ENVIRONMENT Other than the Companies Act and the JSE Listings Requirements. No. It should be noted that all legislation is subject to amendment and it is not possible to predict the outcome or timing of amendments and/or modifications to the applicable legislation and regulations promulgated in terms thereof. the NGB has the responsibility to regulate the CEMS to ensure compliance with the Gambling Act and other relevant legislation and adherence to good business practices. This has a negative impact on occupational health and safety. The NGB has the objective to promote uniform norms and standards that shall apply in all provinces and bring uniformity in legislation relating to gambling in South Africa. the contents of this paragraph 16 are by no means a comprehensive exposition of the importance of the relevant legislation but are intended to be a brief overview thereof. Since it was first awarded the CEMS contract in 2003. Some of the principal South African legislation regulating the different industries in which Mvelaserve operates is highlighted below. 56 of 2001. 15. The Group will continue to uphold the spirit of PSIRA Act and will continue to ensure that its personnel comply with the requirements. as amended (“PSIRA Act”) The PSIRA Act provides for the regulation of the private security industry and for that purpose a regulatory authority was established to provide for matters connected therewith. 16. who are assisted to remain healthy and productive for as long as possible. or their impact. HIV/AIDS As a large-scale employer. CSI activities of Mvelaserve’s businesses provide financial and non-financial support to benefit organisations and associations. 27 . therefore. The NGB has determined that the CEMS assists in the achievement of these objectives and that such a system shall. Zonke has carried out its duties with a high level of responsibility in adherence to the Gambling Act. and has always maintained the highest level of security industry principles. absenteeism and employee deaths. by conforming to the guiding principles. In terms of the Gambling Act. National Gambling Act. as amended (“Gambling Act”) In terms of the Gambling Act. achieve high levels of data integrity and security. employee productivity. aims to maintain a trustworthy and legitimate private security industry which acts in terms of the principles contained in the Constitution of the Republic of South Africa (“Constitution”) and other applicable laws. and will continue to do so for the duration of its agreement. Protea Coin has been part of the security industry for many years. the NGB has provided for the introduction of a CEMS for LPM’s. Zonke holds the sole CEMS Operator agreement in South Africa. Most of the CSI activities of Mvelaserve are found in the projects undertaken by the Mvelaserve businesses. 7 of 2004. skills training and job creation.14. employee benefit costs and staff morale.

any foodstuff which: (i) contains or has been treated with a prohibited substance. 101 of 1965) ordinarily eaten or drunk by man or purporting to be suitable. (ii) contains a particular substance in a greater measure than that permitted by regulation. mode or place of its manufacture. packed. nature. The objective of the Foodstuffs Act is to control the sale. labelled. 91 of 1964. Despite any other registration required by the Customs Act. Act No. or imports for sale. It is further envisaged that the Firearms Act will prevent the proliferation of illegally possessed firearms by providing for the removal of these firearms from society and by improving control over legally possessed firearms. any foodstuff. composition. possession. It also constitutes a criminal offence to sell.Firearms Control Act. among other things. sold. The Foodstuffs Act makes provision for the appointment of inspectors by the Director-General of Health. 28 . or is in terms of any regulation deemed to be. and includes any part or ingredient of any such article or substance. offences liable for prosecution in terms of its provisions range from causing bodily injury to any person or causing damage to property of any person by negligently using a firearm or to selling. or for purposes of sale. or sells. the Commissioner of the South African Revenue Service (“Commissioner”) may require all persons or classes of persons participating in activities regulated by the Customs Act to register. manufacture or use of certain goods. or manufactured or sold. for human consumption. No. Any person convicted of a contravention of or a failure to comply with certain sections of the Firearms Act may be sentenced to a fine or to imprisonment for a period as provided for in terms of the schedules to the Firearms Act. and to prevent crime involving the use of firearms.” Under the Foodstuffs Act. conveyed. No. cosmetic or disinfectant described in the manner aforesaid. manager or agent which constitutes an offence under the Foodstuffs Act will. impure or decayed. subject to certain exceptions. substance. as amended (“Customs Act”) The principal piece of legislation applicable to the operations of Contract Forwarding is the Customs Act and the numerous schedules thereto dealing with import and export tariffs and classification. supplying or in any other manner giving possession of a firearm or ammunition to a person who is not allowed in terms of the Firearms Act to possess that firearm or ammunition. nutritive value or other properties or the time. which includes. safe storage. stored. strength. as amended (“Firearms Act”) The purpose of the Firearms Act is to enable the Government of South Africa to fulfil its duty in terms of the Constitution to protect every person’s right to life and the right to security of a person. An inspector may at all reasonable times enter upon any premises on or in which any foodstuff. (iii) has been treated with a substance containing a particular substance in a greater measure than that permitted by regulation. describes any foodstuff. An act of an employee. Customs and Excise Act. harmful or injurious to human health or (ii) which contains or has been treated with a contaminated. be deemed to be the act or omission of the employer or principal and such employer or principal may be convicted and sentenced in respect of the offence. treated. Foodstuffs. cosmetic or disinfectant is or is suspected to be carried out. 54 of 1972. as amended (“Foodstuffs Act”) As the operations of Royalserve Catering and Khuseti entail the manufacture. cosmetic or disinfectant in a manner which is false or misleading as regards its origin. graded. In respect of advertising. a person is guilty of an offence if he or she publishes a false or misleading advertisement of any foodstuff. Cosmetics and Disinfectants Act. In terms of section 120 of the Firearms Act. and to provide for incidental matters. 60 of 2000. The Customs Act prohibits and controls the importation. the right to be free from all forms of violence from either public or private sources. purity or quality prescribed by regulation for or in respect of it or any standard so prescribed for or in respect of its other attributes or (iv) the sale of which is prohibited by regulation. sale and supply of food. strength. any foodstuff or cosmetic: (i) which is contaminated. quality. No. Administrative fines which may be imposed in terms of the Firearms Act range from between R5 000 to R100 000. cosmetic or disinfectant. “Foodstuff ” is defined as “any article or substance (except a drug as defined in the Drugs Control Act. transfer and use of firearms and to detect and punish the negligent or criminal use of firearms by enforcing the provisions of the Firearms Act. (iv) does not comply with any standard of composition. kept. it is a criminal offence to sell. export. manufacture and importation of foodstuffs. served or administered or on or in which any other operation or activity with or in connection with any foodstuff. The Government will also be able to control the supply. or to manufacture or to import for sale. manufacture or import for sale. marked. cosmetic or disinfectant is or is suspected to be manufactured. impure or decayed substance. or any substance used or intended or destined to be used as a part or ingredient of any such article or substance. cosmetics and disinfectants. these entities are regulated by the Foodstuffs Act and the regulations thereunder.

is no longer qualified according to the prescribed qualifications. The CPA establishes a strict liability. defines what is meant by “consumer” for purposes of the CPA. The Commissioner may refuse any application for a new licence or the renewal of a licence on specified grounds. or a recipient or beneficiary of those particular services. Grounds for exemption are. or that the holder of such licence or the employee of such licensee has contravened or failed to comply with the provisions of the Customs Act. which sets out definitions. by giving written notice to the franchisor. a person who has entered into a transaction with a supplier (a person who markets any goods or services) in the ordinary course of business and someone who is a user. in respect of a person acting in the ordinary course of business: • an agreement between or among that person and one or more other persons for the supply or potential supply of any goods or services in exchange for consideration.The preamble of the CPA emphasises the need for both a positive economic environment and appropriate legal framework that entails the promotion of an environment that supports and strengthens a culture of consumer rights and responsibilities. No. as the case may be. and provides that any producer or importer.No person is permitted to perform any act or be in possession of or use anything in respect of which a licence is prescribed in Schedule 8 to the Customs Act unless such person has obtained the appropriate licence on payment of the requisite licensing fees. when goods or services are supplied to the state and where the consumer is a juristic person whose asset value or turnover exceeds the prescribed threshold value. business innovation and enhanced performance. A regulatory authority may also apply for an industry wide exemption relating to that industry’s particular goods or services. 29 . has been convicted of an offence involving dishonesty. There is also specific regulation of franchise agreements in section 7 of the CPA. distributor or retailer.The purposes of the CPA are to promote and advance the social and economic welfare of consumers in South Africa. which is particularly relevant insofar as Khuseti Holdings is concerned. The application incorporates the promotion of goods or services and also applies to the supplier of any goods or services unless exempted. unless it is exempted in terms of sub-sections 5(2) – (4). The CPA regulates “transactions” as contemplated therein. which are defined as. The CPA establishes a comprehensive legal framework in so far as consumer s’ entitlements and suppliers’ responsibilities are concerned. has been convicted of an offence under the Customs Act. that person of any services for or at the direction of a consumer for consideration. means a person to whom goods or services are marketed in the ordinary course of business. Contract Forwarding possesses all requisite licences under the Customs Act and is in compliance with such licences and the Customs Act. importer. Consumer Protection Act. defect or hazard in any goods. no longer carries on the business for which the licence was issued. Such grounds would include the fact that the holder of such licence is sequestrated or liquidated. Amongst other things. no person except a licensed clearing agent or a person specified by rule may represent any principal as a consultant or agent for purposes of transacting any business on behalf of such principal in relation to customs and excise matters until such a principal is registered with the Commissioner. or inadequate instructions or warnings provided to the consumer pertaining to any hazard arising from or associated with the use of any goods. distributor or retailer of any goods is liable for any harm caused wholly or partly as a consequence of supplying any unsafe goods. 68 of 2008 (“CPA”) Mvelaserve’s operating subsidiaries are primarily involved in the provision of goods and services to consumers and therefore the CPA will have a substantial impact on their operations. or • the performance by. inter alia. irrespective of whether the harm resulted from any negligence on the part of the producer. Section 1 of the CPA. The CPA is a watershed development in the field of consumer protection in South Africa and it will have a material impact on the relationship between consumers and businesses. The Commissioner may also cancel or suspend a licence on specified grounds. In particular. or has failed to comply with any condition or obligation imposed by the Customs Act or by the Commissioner in respect of such licence. In terms of section 5(1)(a) the CPA is applicable to every transaction occurring within South Africa. section 7 provides that a franchisee may cancel a franchise agreement without cost or penalty within 10 business days after signing such agreement. or • the supply by that person of any goods to or at the direction of a consumer for consideration. inter alia. The CPA was assented to on 24 April 2009 and was published in GG32186/29-4-2009 and for the most part takes effect 18 months after the date on which it was signed by the President of South Africa. or at the direction of. failed to pay any amount demanded under the Customs Act within 30 days from the date of such demand. which. a product failure.

30 . people with disabilities and people living in rural areas through strategies which seek to. which aims to protect and conserve water resources in South Africa. The New Companies Act Mvelaserve is incorporated in terms of the Companies Act. Black Economic Empowerment In 1994. 63 of 2001. and the periods within which those targets must be achieved.Competition law The Competition Act regulates competition and uncompetitive behaviour in South Africa. No. While the New Companies Act has not yet come into force. Whilst the private sector is not obliged to comply with BEE requirements. the Employment Equity Act. No. The BBBEE Act obligates organs of state and public entities to take into account and to apply. These laws are applicable in particular to Mvelaserve’s catering. as amended. as amended. 107 of 1998. which provides for the prevention of atmospheric pollution. designed to promote transformation in the South African economy and redress the country’s history of racial disparities. 36 of 1998. the Unemployment Insurance Contributions Act. 75 of 1997. apply the Codes when issuing licenses or concessions. healthcare and industrial cleaning businesses. when doing certain specified activities including determining qualification criteria for the issuing of licenses. and in particular. Broad-based BEE involves the economic empowerment of all black people. the Unemployment Insurance Act. amongst other things. organs of state and public bodies must take into account and. Prohibited practices include anti-competitive agreements and practices between competitors. the Competition Act deals with both prohibited practices and merger control. Any future merger or acquisition by Mvelaserve is likely to require approval by the relevant competition authorities. No. the Basic Conditions of Employment Act. the National Water Act. and provide a generic scorecard with weightings for the various elements of BEE which are used to measure the level of compliance with the targets set out in the Codes by an enterprise. Dominant firms are also prohibited from abusing their positions of dominance in terms of the Competition Act. the Skills Development Levies Act. as far as is reasonably possible. it is expected to come into force during the first quarter of 2011. qualifying mergers and acquisitions must be approved by the relevant competition authorities. No. as well as decisions by associations of competitors. In April 2004. the Occupational Health and Safety Act. as amended. 97 of 1998. 9 of 1999. the South African Government introduced its BEE policy. as amended. The Codes specify empowerment measurement and targets consistent with the objectives of the BBBEE Act. The “New Companies Act” has been promulgated and will eventually replace the Companies Act in its entirety. and the Atmospheric Pollution Prevention Act. determining qualification criteria for the sale of state owned enterprises and developing criteria for entering into partnerships with the private sector. No. 45 of 1965. 130 of 1993. Broadly speaking. No. increase the number of black people that manage. the Skills Development Act. The New Companies Act is expected to undergo substantial correction and amendment before coming into force. No. 85 of 1993. No. No. and the Compensation for Occupational Injuries and Diseases Act. as amended. as amended. the BBBEE Act came into effect. Environmental laws Environmental laws which Mvelaserve has to comply with are. the National Environmental Management Act. which Act regulates the enforcement and administration of environmental law and the principles to be applied in matters pertaining to environmental law. and determining qualification criteria for the sale of state owned enterprises. the Codes (discussed below) issued in terms thereof. The Codes set out the requirements for and measurement of BEE for businesses in South Africa in general. including the Labour Relations Act. 66 of 1995. No. Labour related legislation Employment and labour relations are regulated in South Africa by legislation. as amended. as far as reasonably possible. what it refers to as “broad based” BEE. youth. 4 of 2002. With regard to merger control. as amended. No. developing and implementing a preferential procurement policy. concessions or other authorisations in terms of any law. own and control enterprises and productive assets. as amended. such as price fixing. The BBBEE Act establishes the legislative framework for the promotion of BEE. as amended. including women.

provide transparency and accountability as well predictable regulation. Mvelaserve will retain its corporate name and registration number. increase flexibility. 31 . the Government’s stated objectives were to simplify the existing regime.Existing companies incorporated and registered under the Companies Act will continue in existence as if they have been incorporated and registered under the New Companies Act. The Listings Requirements will need to be amended to some extent to reflect the changeover to the New Companies Act. The New Companies Act has been designed to introduce fundamental changes to South African company law. and Mvelaserve may have to make some adjustments in order to comply with any amended Listings Requirements. Public companies under the New Companies Act are largely comparable to public companies under the Companies Act. ensure corporate efficiency. In reforming South Africa’s company laws.

age and nationality M S M Xayiya. 2076 28 Eddington Crescent Highveld Technopark Centurion. As at the Listing Date. 2057 1 Medborn Street Midstream Estate Midstream. He holds a BA (Unisa). He subsequently left public office and joined Mawenzi Asset Managers as Managing Director. 1685 9 Steenveld Road Freeway Park Boksburg. (52). Gauteng Provincial Government. In 1995 he was appointed as a Policy Adviser – Office of the Premier. South African G D Harlow (53). the Board will comprise three Executive Directors and five Non-executive Directors of which all are independent. 2055 38 Centre Road 14 Crystal Court Morningside. DIRECTORS AND MANAGEMENT Details of the directors of Mvelaserve as at the Listing Date are set out below: Name. South African N Mbalula (32). 0169 1st Floor 30 Melrose Boulevard Melrose Arch Johannesburg. 32 . The profiles of the Directors and senior management team are set out below: EXECUTIVE DIRECTORS Mikki Sivuyile Macmillan Xayiya – Executive Chairman Mikki has served in various capacities in the African National Congress since 1977. South African Chief Financial Officer Fixed O A Mabandla (47). The Board recognises that having an Executive Chairman is not in compliance with the recommendations of the King Code. In accordance with the Listings Requirements. To address this.PART B: MANAGEMENT AND CORPORATE GOVERNANCE 17. South African * Appointed as Director of Mvelaserve with effect from the Listing Date. Cert of Defence Management (Wits) and Emerging Market Leadership Program (University of Pennsylvania). South African F N Mantashe (49). five of the Directors have been appointed on a rotational basis. In 1998 he co-founded Mvelaphanda Holdings. the Board has appointed O A Mabandla as the Lead Independent Non-executive Director of the Board. 1459 6 Cowie Road Forest Town Johannesburg. All the Directors are South African citizens. and are obliged to retire and are eligible for re-election by Mvelaserve Ordinary Shareholders at least once every three years in accordance with the Articles of Association. He was appointed as Executive Chairman of Mvela Group in 2009. (49). South African Chief Executive Officer Fixed G E Röth. 2076 7 Sweetgum Crescent Fourways Gardens Fourways. 2193 Occupation/Function Executive Chairman Term of office Fixed* J M S Ferreira. South African Lead Independent Non-executive Director Independent Non-executive Director Independent Non-executive Director Independent Non-executive Director Independent Non-executive Director Not fixed (rotation every three years)* Not fixed (rotation every three years)* Not fixed (rotation every three years)* Not fixed (rotation every three years)* Not fixed (rotation every three years)* S Masinga (43). South African Business address 1st Floor 30 Melrose Boulevard Melrose Arch Johannesburg. (53).

firstly into Molope Group in 1996 and then into Rebserve Limited in 1998. and an Associate of the Chartered Institute of Management Accountants (UK). She has held various executive positions in financial services. He was appointed as Chief Operating Officer of Mvelaserve early in 2009 and subsequently appointed as Chief Executive Officer of Mvelaserve in July 2009. Gilbert Ernst Röth – Chief Financial Officer Ernst will be appointed as the Chief Financial Officer of Mvelaserve on the Listing Date. Gary David Harlow – Independent Non-executive Director Gary forged his career in merchant banking and was the advisor to the finance department of the African National Congress in the early 1990s regarding developing BEE policy. He has held various positions within legal and investment banking profession and was previously Deputy Chief Executive Officer of South African Airways. Gary qualified as a Fellow Chartered Management Accountant (UK) in 1996. an investment holding company. He holds a BA degree from the University of California and a Juris Doctor from Columbia University. NON-EXECUTIVE DIRECTORS Oyama Andrew Mabandla – Lead Independent Non-executive Director Oyama is the immediate past chairman of Vodacom Group Limited. is a member of the JP Morgan Advisory Board and Executive Chairman of Langa Lokulunga Investment Holdings (Proprietary) Limited. including as a financial specialist at Development Bank of South Africa and has held research analyst positions with Gensec Securities and Real Africa Durolink. Prior to joining Mvela Group he held various positions with companies in the banking. from consulting. corporate advisory and research. Protea Security Services and Coin Security Group were merged in 2007 and Jorge was appointed as Chief Executive Officer of the Protea Coin Group. 33 . She has been with the Jupiter Drawing Room since 2007. In 1992 he played an instrumental role in the creation of Thebe Investment Corporation and also served as joint Chief Executive Officer of Msele Corporate and Merchant Bank. Nozuko Mbalula – Independent Non-executive Director Nozuko joined FCB Johnson in 2003 from where she joined the South African Broadcasting Corporation in 2004. He has served on numerous private and public company boards and serves as chairman on the Investment and Transformation Committee and as a member of the Audit and Risk Committee of Blue Label Telecoms Limited. She has a BA (Hons) in Industrial Sociology and completed a Business Management Programme at the Wits Business School. financial services/consulting and biochemical industries and also worked in the office of the Auditor General of South Africa. Sibongile Masinga – Independent Non-executive Director Bongi is the Chief Executive Officer and one of the founding members of the Afropulse Group. Gary joined Unihold Limited as Chief Executive Officer in 1996. She holds a diploma in Human Resources Management and a Higher Diploma in Integrated Marketing Communications specialising in brand management. Prior to this she was the Chief Operating Officer and head of Corporate Advisory at Africa Vukani Investments. She also gained merchant banking experience with Hill Samuel in London. He is a qualified CA(SA) and has a Post-graduate Certificate in Advance Tax (Unisa). is a qualified CA(SA). Ernst has been Chief Financial Officer of Mvela Group since 5 September 2007 and was appointed to the board of directors of Mvela Group on 11 November 2007. Bongi has a Bachelor of Commerce degree with majors in accounting and financial management and she has completed the USA-SA Leadership and Entrepreneurship Programme at the Wharton School of Business. During this time he completed an executive development programme at the University of the Witwatersrand.Jorge Manuel Soares De Alberga Ferreira – Group Chief Executive Officer Jorge founded Protea Security Services in 1982 where he retained the position of Managing Director and later Chief Executive Officer during the control changes of Protea Security Services. Flora Nolwandle Mantashe – Independent Non-executive Director Nolwandle started her career at Goldfields and moved to Pretoria Portland Cement Limited in 2008 where she currently serves as the Transformation Executive.

Within less than a year Tseliso took up reigns of Mvelaserve Cleaning and was appointed to his current role in October 2009. Khuseti Chris has been the Chief Executive Officer of Khuseti for one year. Protea Coin Petrus took over the reins as Chief Executive Officer for Protea Coin Group on 25 March 2009. he achieved a BCompt degree at the beginning of 1994. a listed international facilities engineering. led to his current portfolio as Chief Executive Officer.TFMC Bruce has 22 years’ experience as a business executive with extensive board management and executive leadership experience in listed companies. This acting position will be reviewed by the Remuneration and Nomination Committee early in 2011. She has 28 years’ experience in the freight industry. the following individuals comprise the senior management of Mvelaserve: Martin Jaap Schermers (47) – Business Development Executive Martin has 12 years’ experience in the mining industry. Among other senior roles Bruce has had in his career. While completing his articles. Petrus Albertus van Niekerk (41) – Chief Executive Officer. He was appointed as Financial Director of Mvelaserve in July 2009. competitive analysis and corporate governance. business re-engineering. transportation and waste management. He was Financial Director at JIC Mining Services from 1996 until 2002. Contract Forwarding Dorothy hails from the United Kingdom and immigrated to South Africa in 1982. as well as a Country Chief Executive Officer/Project Director for Compass Group plc. Previously. Martin will resign as Financial Director of Mvelaserve on the Listing Date and will be appointed as the Business Development Executive of the Group.This role is undertaken on a part-time basis. Bruce was appointed to his current role in April 2010.SENIOR MANAGEMENT In addition to M S M Xayiya. a JSE-listed company. 34 . Christopher Robert Waterson (55) – Chief Executive Officer. 25 of which were with Contract Forwarding. Dorothy Kynaston (50) – Acting Chief Executive Officer. Bruce was the Managing Director of a subsidiary of The Bidvest Group Limited. a position he held until mid 2008. He was appointed Chief Operating Officer for Protea Coin Group in June 2007. Financial Director at Petrex until 2004 and was appointed Managing Director of Bema Gold South Africa until the end of 2006 when he was appointed as Chief Financial Officer of Pamodzi Gold. Royalserve Tseliso joined the Rebserve Cleaning Services as General Manager of the Berco Speciality Commercial Brand in 2007. requiring enormous attention to partner and customer relationships in order to be successful. He has been involved in the security industry for almost 15 years. His career as an accountant and financial manager in the corporate environment began at Protea Security in April 1994. Tseliso Daniel Pitikoe (37) – Chief Executive Officer. Chris was the Chief Executive Officer of Contract Forwarding for 13 years. J M S Ferreira and G E Röth. The freight industry is arguably one of the most service-driven industries. to her current position as acting Chief Executive Officer in November 2009. Tseliso holds a National Diploma in Mechanical Engineering and an MBA from Thames Valley University. Martin has completed his articles and holds a BCompt degree from UNISA. a listed Swedish company manufacturing and supplying integrated technology and engineering solutions.The same principles apply to Khuseti’s business where ongoing support and communication with franchisees and clients are key to maintaining successful business relationships. which subsidiary supplies integrated building management and technology solutions to various industries. business development. Before this. 13 of which were in an executive capacity. She began her career at Contract Forwarding as an export clerk and continued to grow through the ranks in a number of departments. which in turn. bringing with him a wealth of experience in industries as diverse as fast moving consumer goods. Chris’ former career in the freight industry spans some 30 years. he was previously executive director of operations for Gunnebo AG. Bruce Ewart Spence (56) – Chief Executive Officer. Chris is also the Chief Executive Officer of FFSI which is a Hong Kong headquartered global association of international freight forwarders comprising more than 90 member companies in over 65 countries worldwide. construction and project management entity. procurement. with strategic management experience in executive and general management including financial and operational performance.

35 . been barred from entry into any profession or occupation. due to dishonest activities. been found guilty in disciplinary proceedings. 18. Zonke Hosea’s previous working experience includes being head of the IT department at the Commission for Conciliation.234 R26. He was appointed Chief Executive Officer of Zonke in 2007. APPOINTMENT. QUALIFICATION. or an offence under legislation relating to the Companies Act. by an employer or regulatory body. 18. fraud or embezzlement. 18. The following Mvelaserve Directors will receive cash payments as set out in the table below: Cash value to be used to acquire Mvelaserve shares net of tax* (R’million) M S M Xayiya J M S Ferreira G E Röth Other Senior managers of Mvelaserve Total * Amount net of tax assumed to be at marginal tax rate of 40% 3. been adjudged bankrupt or sequestrated in any jurisdiction.750 9. and subject to the after tax cash being used to acquire Mvelaserve Ordinary Shares on the JSE with a lock-in period of 2 years.Maketse Hosea Malope (41) – Chief Executive Officer. the remuneration payable to the Directors will not be varied in consequence of the Listing. is calculated with reference to the increase in Mvelaserve’s intrinsic NAV from 30 June 2009 (R1 039 million) to 30 June 2010 (R1 723 million). 18. which will be used to acquire Mvelaserve Ordinary Shares on the JSE. The quantum of the cash payment.1 The relevant provisions of the Articles of Association relating to the qualification. subject to the successful listing on the JSE.5 Remuneration of the Directors The total remuneration and benefits paid and payable to the executive and non-executive Directors for the year ended 30 June 2010 are set out below: (Rand) Salaries Fees Benefits Bonuses Pension Scheme benefits Medical aid contributions Total Directors’ remuneration Executive 4 260 156 – 428 288 2 100 000 235 166 68 118 7 091 728 Non-Executive – – – – – – – Total 4 260 156 – 428 288 2 100 000 235 166 68 118 7 091 728 During 2008 the Mvela Group Remuneration Committee resolved to commence a process to motivate and retain key management at Mvelaserve. Mediation and Arbitration (CCMA).3 An extract from the Articles of Association regarding the Directors’ voting on material contracts where they have an interest is set out in Annexure 12.750 10. As a result of the separate listing of Mvelaserve. the Mvela Group Remuneration Committee approved the payment of cash bonuses to various executives involved in Mvelaserve. borrowing powers and appointment of the Directors are set out in Annexure 12 to this Pre-listing Statement. suspended payment or compounded with their creditors. remuneration.994 Further details of the Directors’ remuneration and service agreements are set out in Annexure 6 to this Pre-listing Statement. at any time assigned their estate.2 None of the Directors have ever: • • • • • • been convicted of an offence resulting from dishonesty. 18. REMUNERATION AND BORROWING POWERS OF DIRECTORS 18. and a business analyst at Monyaka Gaming Machines Supply. Except for the remuneration as detailed above.260 3.4 The borrowing powers of the Directors have not been exceeded in the preceding three year period prior to the date of this Pre-listing Statement. and/or been convicted in any jurisdiction of any criminal offence.

in protecting and adding value to the Mvelaserve Group financial and human investment. 20. No Director has been paid any monies to induce him/her to become a Director in the three years preceding the date of this Pre-listing Statement.4 Other than as already mentioned above. DIRECTORS’ INTERESTS IN THE SHARE CAPITAL OF MVELASERVE The Directors held the following direct and indirect beneficial interests in Mvela Group as at the Last Practicable Date: Directors Executive M S M Xayiya J M S Ferreira G E Röth Non-Executive O A Mabandla S Masinga N Mbalula F N Mantashe G D Harlow Total Note: 1. or of which he is a director (“the associate company”). syndicate or other association of which he/she is a member (“the associate entity”). and subject to the after tax cash being used to acquire Mvelaserve Ordinary Shares on the JSE with a lock-in period of 2 years. Beneficial Direct Indirect Total % of issued share capital 32 – – – – – – – 32 3 340 824 – – 125 807 – – – – 3 466 631 3 340 856 – – 125 807 – – – – 3 466 663 2.4 – – 1 – – – – 2. DIRECTORS’ INTERESTS IN TRANSACTIONS No Director had any interest in transactions effected by Mvelaserve.19. CORPORATE GOVERNANCE Commitment and approach The Mvelaserve Group and Board confirm their commitment to and subscribe to the principles of transparency. Less than 0. integrity and accountability. or to any partnership. Fundamental to the fulfilment of corporate responsibilities and the achievement of financial objectives is. the intention is to comply with the requirements of the King Code in both letter and spirit. there has been no material change in the interests of the Directors in the share capital of Mvelaserve between the end of the preceding financial year (30 June 2010) and the date of this Pre-listing Statement. 36 . by any person either to induce him to become or to qualify him as a Director. MANAGEMENT LOCK-IN The Mvela Group remuneration committee approved the payment of cash bonuses to various executives involved in Mvelaserve subject to the successful listing on the JSE. or in an earlier financial year and which remain in any respect outstanding or unperformed. directly or indirectly. Please refer to paragraph 18 for a detailed summary of this arrangement. Mvelaserve strives to integrate corporate governance into all aspects of its business. No loans have been made by Mvelaserve to any Director. either during the current or immediately preceding three financial years. They further confirm their commitment to an open corporate governance process through which its shareholders and other stakeholders may derive assurance that. with particular emphasis being placed on the importance of the qualitative aspects of corporate governance. 21. the Group is being managed ethically. an effective system of corporate governance which is entrenched in the Group’s systems of internal control and by its procedures and its profiles governing corporate conduct. nor were any amounts paid or agreed to be paid within the three years preceding the date of this Pre-listing Statement to any Director or to any company in which he is beneficially interested. 22.1%. in cash or securities or otherwise. or otherwise for services rendered by him or by the associate company or the associate entity in connection with the promotion or formation of Mvelaserve. In discharging this responsibility. according to prudently determined risk parameters and in compliance with good corporate governance practices.

• beyond reproach in the quality of its services. an Executive Director. and • code of conduct. clearly defined lines of accountability and delegation of authority and make provision for comprehensive reporting and analysis against approved standards and budgets and the responsibility for their accuracy. The Board is committed to providing. The Group has a documented Code of Conduct for employees designed to provide guidance as to the ethical conduct of employees in all areas. • consistent in honouring its legal and moral obligations. to ensure that it has an effective programme to prevent and detect violations of law and for the education and training of employees. compliance with legislation and sound accounting practice. directors and other officers. employees. act on behalf of or represent the Group.The Directors have pro-actively taken all the necessary steps to ensure full compliance with the recommendations incorporated in the King Code. • outstanding in its integrity and credibility. appropriate policies in respect of the safeguarding of assets and information.The Mvelaserve Group policy on business conduct. • risk management and internal control. The Code of Conduct does not remove the need for all employees to exercise good judgement. • socially and environmentally responsible.The Board is of the opinion that Mvelaserve is compliant with the Listings Requirements and with the King Code in nearly all material respects. The Mvelaserve Board recognises and acknowledges its responsibility for the Group’s systems of internal. The Code of Conduct is a common reference point for defining how each employee is expected to act when conducting Group business. an Executive Director. All employees must act in a fashion that will ensure that the Group continues to have the reputation of being: • transparent and frank in its dealing with and disclosures to all stakeholders. Adherence to the Code of Conduct will help to maintain the highest ethical standards in dealings by each employee with all stakeholders. and • applies best practices in Corporate Governance. Each employee still has the responsibility to work with integrity and good judgement. monitors and audits a safe system for employees to report any unethical behaviour by fellow employees. it makes it easier. consultants and other third parties when acting on behalf of or representing the Group. delegated to the Executive Directors and key management who are required to confirm that they regularly review the effectiveness thereof. overseeing its efficient operation and has been tasked with ensuring effective corporate governance practices. 37 . • aware of the need to foster loyalty and fidelity in long enduring relationships. directors or shareholders of the Group. This includes employees. the Board will be chaired by M S M Xayiya. Code of Conduct The Board strives to ensure that the Group conducts its business with the utmost integrity towards all its stakeholders. financial and operational control. the following: • the role and function of the Board. which covers ethical behaviour. The Code of Conduct must be adhered to by all those who work for. This is discussed in the section relating to the “Board” on page 38. The Group provides. customers. including its shareholders. suppliers and society at large. contractors. The Code of Conduct reaffirms the high standards of business conduct required of all employees of the Group and has been created as part of the Group’s continuing commitment to ensure that it complies with all applicable laws. • monitoring of investment and operational performance. The Chairperson is responsible for providing leadership to the Board. • meeting procedures. The Board has adopted a board charter which covers. underpins the Group’s internal control processes. except that the Board will be chaired by M S M Xayiya. and the appropriate corrective measures to enforce these policies. timely. Chairperson and Chief Executive Officer On the Listing Date. managers. as well as within the law. relevant and meaningful reporting to all stakeholders. • the Board structure. The control systems include written Policies and Procedures. inter alia.

effective on the Listing Date. Board actions The Board discharges its responsibilities through a number of its actions. implementing and maintaining the strategic direction of Mvelaserve. the Board will comprise a majority of Non-executive Directors. This includes but is not limited to: • appointing and maintaining a Chairperson. 38 . and where appropriate. • all Directors. As a group. J M S Ferreira. appropriate background checks are performed on proposed new Directors. To address this. is responsible for formulating. upholding the core values of integrity. credibility. determining and ensuring the implementation of corporate strategy and policy. The Board will retain full and effective control over the business of the Group. • maintaining transparency and accurate records of its decisions. The Executive Directors have fixed terms of appointment and. impact they are expected to have and time and attention they can devote to the role. The Board recognises that having an Executive Chairman is not in compliance with the recommendations of the King Code. at the expense of Mvelaserve. as well as ensuring that the day-to-day affairs of the Group are appropriately supervised and controlled. by rotation. • the Non-executive Directors not holding fixed term service contracts. all the Non-executive Directors are subject. and • the appointment or dismissal of the Company Secretary being decided by the Board as a whole and not by one individual Director. Before nomination. • functioning Board committees comprised mainly Non-executive Directors. The Board intends to meet at least four times a year with additional meetings called if necessary or desirable. The delegation will be regularly reviewed and monitored. to retirement and re-election by shareholders at least every three years. the Directors have been and will be nominated based on their calibre. may seek the advice of independent professionals on matters concerning the affairs of the Group. in accordance with Mvelaserve’s Articles of Association. they will enjoy significant influence at the meetings. Board As at the Listing Date.The Remuneration and Nomination Committee is responsible for vetting the individuals proposed for Directorship and making recommendations to the full Board for approval. the Board has appointed O A Mabandla as the Lead Independent Non-executive Director on the Board. Generally. • evaluating.The Board has defined levels of materiality through a written delegation of authority. Information relevant to a meeting is supplied on a timely basis to the Board ensuring Directors can make reasoned decisions. including: • determining the Group’s Code of Conduct and conducting its own affairs in a professional manner. knowledge. with prior permission of the Board. being entitled to seek independent professional advice regarding the affairs of the Group at the Company’s expense. New Directors are taken through a formal induction programme and are provided with all the necessary background information to familiarise them with issues affecting the Board. experience. Independence of the Board The Board’s independence from the team responsible for the daily management of Mvelaserve will be maintained by: • keeping separate the roles of the Chairperson and the Chief Executive Officer. and • aiming to educate and update itself as a Board continuously on matters affecting the future of the Group. Non-executive Directors will bring an independent view to the Board’s decision-making. with all of the five Non-executive Directors being independent. transparency and enterprise. which sets out decisions the Board wishes to reserve for itself. Self governance The Board is accountable to shareholders but undertakes to manage itself. The Directors have unrestricted access to information and management in relation to the Group.The Chief Executive Officer. • regularly monitoring and appraising its own performance. • all Directors having access to the advice and services of the Company Secretary.

• seeking to ensure ethical behaviour and compliance with relevant laws. and • providing counsel and advice to the Chief Executive Officer and his team on all critical and sensitive matters. • reviewing succession planning for the management team and endorsing senior executives’ appointments. does not get involved in the day-to-day management of the Group. Additional roles and responsibilities Without limitation. The Board requires a formal strategic planning system that reviews and approves or updates strategic plans presented by management annually and monitors the Group’s performance against those plans. including. the Group’s own governing documents and Code of Conduct. Board committees Several committees have been established to assist the Board in carrying out its duties. • comparative performance against peers. regulations. • authorising and controlling capital expenditure and reviewing investment capital and funding proposals. Strategy formulation and execution The Board defines the strategic policy intent and objectives of the Group as a business enterprise as well as its values. and • developing and setting disclosure and reporting practices at a minimum. as required by applicable law to best serve the needs of its shareholders. A. implementing and monitoring the process of risk management and integrating it into operations. development. The Board has delegated to the committees specific roles of responsibility and these are set out in the respective committee charters. The Board annually reviews the effective performance of each of its committees. It is intended that the Audit and Risk Committee will meet at least twice a year. The members of this committee will be: • G D Harlow (Chairman). As at the Listing Date. the Board is further responsible for: • monitoring the performance of the Group in all respects. the Audit and Risk Committee has satisfied itself of the appropriateness of the expertise and experience of the Chief Financial Officer. risk management and development/maintenance of an effective internal control system. • financial reporting accuracy and integrity. It executes them through the Chief Executive Officer and his management team and. all of whom are independent. except in exceptional circumstances. audit and accounting principles/ practices. on an annual basis. this committee will consist of three Non-executive Directors. Mr G E Röth. • management performance. ensuring compliance with laws and regulations. and • S Masinga.• determining compensation. Audit and Risk Committee On the Listing Date. Management is accountable to the Board for designing. internal and external audit management. • risk exposures and controls.The Audit and Risk Committee will. education and other relevant policies for Mvelaserve employees. and • shareholder satisfaction. Each Board committee has its own charter which defines its purpose. • the overall system of risk management system including setting management expenditure authorisation and exposure limit guidelines. • setting the capital structure of the Group. • O M Mabandla. consider and satisfy itself of the appropriateness of the expertise and experience of the Chief Financial Officer of the Group. authority and responsibility. The Audit and Risk Committee is responsible for assisting the Board in fulfilling its responsibilities in respect of financial reporting issues. There is full disclosure and transparency from the committees to the Board. organisational changes and general remuneration policy. inter alia: • performance of the operations. 39 .

In setting and approving remuneration levels and structures. The Audit and Risk Committee sets the principles for recommending the use of the external auditors for non-audit purposes. and • developing. internal controls. aimed at aligning the executives’ interests with that of the shareholders. In discharging its responsibilities. Other responsibilities of the Executive Committee include: • providing leadership to the senior management and staff of the Group. assessing the effectiveness of the composition of the Board and evaluating the Board and individual Director’s performances. taking into account differing levels of responsibility. The remuneration strategy is aimed at ensuring that levels of remuneration are sufficient to attract. developing strategy and policy proposals for consideration by the Board and implementing the Board’s directives. ensuring Directors and senior executives are fairly rewarded. • N Mbalula. and who is responsible to the Board for ensuring the proper administration of Board proceedings. including advice on tax planning and transfer pricing issues. an element of the strategy is aimed at ensuring that the performance-related elements of the executive’s remuneration should constitute a growing portion of total remuneration. at the expense of Mvelaserve. performance and complexity. and • training. The remuneration package will mainly have two elements: a market-related base pay and incentive pay comprising an annual cash bonus. Remuneration and Nomination Committee On the Listing Date. and • G D Harlow. which include: • tax services. where appropriate. • developing the annual budget and business plans for approval by the Board. Consequently. Executive Committee This committee comprises the Executive Chairman. where appropriate. The Company Secretary also provides guidance to the Directors on their responsibilities within the prevailing regulatory and statutory environment and the manner in which such responsibilities. ethics and authority levels. implementing and monitoring policies and procedures.The Audit and Risk Committee members have unrestricted access to information and management of the Group and. This committee will meet at least twice a year and is responsible for assisting the Board in fulfilling its responsibilities in respect of maintaining an appropriate remuneration strategy. the committee may also get advice from specialist remuneration consultants as and when needed and consider remuneration levels for other executives and employees in the Group. the committee will make comparisons to remuneration paid by other companies in the same industry or similar industries. C. Company Secretary All Directors have access to the advice and services of the Company Secretary. all of whom are independent. • merger and acquisition advice. The members of this committee will be: • F N Mantashe (Chairman). the Chief Executive Officer. whose appointment is in accordance with the Companies Act. providing for succession planning. • corporate restructuring. B. including not dealing in the Ordinary Shares during restricted periods. retain and motivate executives and. the Chief Financial Officer and certain senior management of the Group. It is responsible for the operational activities of the Group. should be discharged. A portion of the remuneration package shall be subject to certain pre-defined performance targets being met. governance. may seek the advice of independent professionals on matters concerning the affairs of the Group. 40 . risk management. the committee will consist of three Non-executive Directors.

that the assets are adequately protected against material losses and unauthorised acquisition. use or disposal. During these periods. the Directors. Internal control systems To meet the Group’s responsibility to provide reliable financial information. The Group monitors the operation of the internal control systems in order to determine if there are deficiencies. will be reported to the market in accordance with the requirements of the JSE. 41 . The Chairman of the Board would require prior written clearance from the Chairman of the Audit and Risk Committee. all share dealings by the Directors. as defined in the Listings Requirements. as defined in the Listings Requirements. Mvelaserve will adopt a share dealing policy requiring all Directors. including the possibility of human error and the circumvention or overriding of controls. Closed periods. These controls are designed to provide reasonable assurance that transactions are concluded in accordance with management’s authority. the Company Secretary and any of their associates. the Group maintains financial and operational systems of internal control. operating through the Audit and Risk Committee. is published. In addition. oversees the financial reporting process and internal control systems. and that all transactions are properly authorised and recorded. as defined in the Listings Requirements. Accordingly. The Board. Corrective actions are taken to address control deficiencies as they are identified. senior executives and the Company Secretary to obtain prior written clearance from either the Chairman of the Board or Chief Executive Officer to deal in Mvelaserve Ordinary Shares. There are inherent limitations on the effectiveness of any system of internal control. executives and inside employees would not be permitted to deal in Mvelaserve Ordinary Shares. Additional closed periods would be enforced should Mvelaserve be subject to any corporate activity where a cautionary announcement. an effective internal control system can provide only reasonable assurance with respect to financial statement preparation and the safeguarding of assets.Share dealings On Listing. shall be observed as required by the Listings Requirements.

Summarised statement of comprehensive income Set out below is the summary consolidated statement of comprehensive income of Mvelaserve. the preparation of which is the responsibility of the Directors. The information set out below should be read in conjunction with such historical financial information and PKF’s report set out in Annexures 2 and 3 to this Pre-listing Statement. 2009 (Reviewed)1 IFRS 3 601 257 (2 703 969) 897 288 49 344 (756 040) 190 592 25 433 (110 492) (7 324) 99 (40 663) 3 463 61 108 (72 753) (11 645) 1 533 (10 112) (12 473) 2 361 (10 112) 100 (125) (143) 2008 (Reviewed)1 IFRS 3 463 275 (2 616 880) 846 395 57 584 (794 665) 109 314 16 536 (30 341) (1 467) – (15 663) 624 79 003 (67 564) 11 439 – 11 439 12 566 (1 127) 11 439 100 114 98 100 1 518 1 514 42 . HISTORICAL FINANCIAL INFORMATION The historical consolidated financial information of the Mvelaserve Group and its subsidiaries for the three financial years ended 30 June 2010. which has been extracted from the financial information of the Mvelaserve Group for the years presented: 12 months ended 30 June (R’000) Revenue Cost of sales Gross profit Other income Operating expenses Operating profit Interest received 3rd party Interest paid 3rd party Interest treasury Dividend income Fair value adjustment and net loss from investments Share of profit from associates Profit before taxation Taxation Profit/(Loss) for the year from continuing operations Discontinued operations Profit for the year from discontinued operations Total comprehensive income for the year Total comprehensive income attributable to: Ordinary shareholders Minority shareholders 2010 (Audited) IFRS 4 061 998 (3 103 298) 958 700 32 671 (700 084)) 291 287 14 888 (77 943) 2 561 – (2 726) 6 075 234 142 (80 282) 153 860 1 155 155 015 151 798 3 217 155 015 Weighted average number of ordinary shares in issue Earnings per ordinary share (R’000) Headline earnings per ordinary share (R’000) 1. PRO FORMA FINANCIAL INFORMATION AND DIVIDEND POLICY 23. 2009 and 2008 is set out in Annexure 2 to this Pre-listing Statement. Audited as part of Mvelaphanda Group Consolidation.PART C: FINANCIAL INFORMATION – HISTORICAL FINANCIAL INFORMATION.

plant and equipment Goodwill Intangible assets Other non-current assets Current assets Trade and other receivables Trade and other receivables – Mvela Group Cash and cash equivalents Other current assets Assets in disposal group held for sale Total assets EQUITY AND LIABILITIES Capital and reserves Shareholder’s equity Minority interest Non-current liabilities Interest bearing liabilities – preference share funding Non interest bearing liabilities – Mvela Group Other non-current liabilities Current liabilities Trade and other payables Interest bearing liabilities – Mvela Group Other current liabilities Liabilities in disposal group held for sale Total equity and liabilities Net number of ordinary shares in issue Net asset value per ordinary share (R’000) Net tangible assets per ordinary share (R’000) Note: The notes to the historical consolidated financial information have been fully disclosed in Annexure 2 to this Pre-listing Statement.This information should be read in conjunction with such financial statements and financial information and the related notes in Annexure 4. are set out below. The unaudited pro forma financial information below has been extracted from the pro forma financial information presented in Annexure 4 to this Pre-listing Statement.Summarised statement of financial position Set out below is summary consolidated statement of financial position of the Mvelaserve Group. adjusted for the Restructuring. 43 . 2010 (Audited) IFRS 2009 (Reviewed) IFRS 2008 (Reviewed) IFRS 975 105 387 619 412 704 132 631 42 152 1 753 501 763 876 97 878 374 809 516 938 5 045 2 733 651 928 440 312 602 414 164 129 836 71 838 1 417 826 705 467 97 878 210 251 404 230 – 2 346 266 887 857 266 258 406 827 127 790 84 296 1 191 938 579 467 105 950 219 150 287 371 280 295 2 357 304 233 300 227 817 5 483 1 367 158 482 438 722 117 162 603 1 133 193 793 736 100 478 238 979 – 2 733 651 100 2 278 (3 350) 78 898 76 019 2 879 1 179 327 482 438 566 362 130 527 1 088 041 748 002 93 560 246 479 – 2 346 266 100 760 (5 010) 90 054 88 492 1 562 981 849 – 848 870 129 979 1 099 405 712 965 74 397 312 043 176 895 2 357 304 100 855 (4 746) Unaudited pro forma financial information The unaudited pro forma consolidated statement of comprehensive income and the statement of financial position of Mvelaserve and its subsidiaries for the year ended 30 June 2010. which has been extracted from the financial information of the Mvelaserve Group for the years presented: 12 months ended 30 June (R’000) ASSETS Non-current assets Property.

71 0. which has been extracted from the pro forma financial information of the Mvelaserve Group as presented in Annexure 4: 30 June 2010 Revenue Zonke Before acquisition R’000 R’000 4 061 998 49 950 19 858 5 (1) (50 985) (13 946) (2 561) (22 453) (100 397) 6 075 (2 726) 19 862 (6 137) 13 725 (36 399) 15 603 (20 796) (53 546) 13 314 (40 232) 164 059 (57 502) 106 557 1 155 13 725 (20 796) (40 232) 107 712 0.Summarised pro forma statement of comprehensive income Set out below is the summarised pro forma statement of comprehensive income of the Mvelaserve Group.71 0.71 Debt Restructure R’000 Listing and Unbundling R’000 After R’000 4 111 948 260 160 947 Profit from operations 291 287 Interest income – 3rd party 14 888 Interest treasury 2 561 Interest expense – 3rd party (77 943) Share of profit from associates 6 075 Net fair value adjustments and profit/(loss) from investments (2 726) Profit before taxation Taxation expense Profit for the year from continuing operations Profit for the year from discontinued operations Total comprehensive income for the year Earnings per ordinary share (R) Headline earnings per ordinary share (R) Diluted earnings per ordinary share (R) Diluted headline earnings per ordinary share (R) 234 142 (80 282) 153.71 0.860 1 155 155 015 1 517 980 1 514 127 1 517 980 1 514 127 44 .

plant and equipment Intangible assets Other non-current assets Current assets Trade and other receivables Trade and other receivables – Mvela Group Cash and cash equivalents Other current assets Assets in disposal group held for sale Total assets EQUITY AND LIABILITIES Capital and reserves Shareholder’s equity Minority interest Non-current liabilities Interest bearing liabilities – preference share funding Interest bearing liabilities – Nedbank Non-interest bearing liabilities Mvela Group Other long-term liabilities Current liabilities Trade and other payables Interest bearing liabilities – Mvela Group Other current liabilities Total equity and liabilities Net asset value per ordinary share (R) Net tangible asset value per ordinary share (R) Note: The key assumptions and notes to the pro forma financial information have been fully disclosed in Annexure 4 to this Pre-listing Statement.Summarised pro forma statement of financial position Set out below is the summary pro forma statement of financial position of the Mvelaserve Group. which has been extracted from the pro forma financial information of the Mvelaserve Group as presented in Annexure 4: 30 June 2010 ASSETS Non-current assets Property.05 0.82 45 . Zonke Before acquisition R’000 R’000 Debt Restructure R’000 Listing and Unbundling R’000 After R’000 975 105 387 619 545 335 42 151 1 753 501 763 876 97 878 374 809 516 938 5 045 2 733 651 36 021 822 35 014 186 5 785 (133 492) (490 048) 1 011 126 388 440 580 349 42 337 1 135 746 763 876 (97 878) 67 607 (459 777) 256 5 529 (133 492) 309 180 63 690 5 045 41 806 (133 492) (490 048) 2 151 917 233 300 227 817 5 483 1 367 158 482 438 37 707 31 120 6 587 (55 470) (482 438) 550 000 455 804 455 804 – (722 117) 726 811 714 741 12 070 589 571 550 000 (722 117) 722 117 162 603 1 133 192 793 735 100 478 238 979 2 733 651 2 278 170 (3 350 380) 41 806 4 099 4 099 (123 032) (78 022) (219 690) 5 955 (100 478) (129 212) (490 048) 39 571 835 535 803 790 (78 022) (133 492) 31 745 2 151 917 5.

• the assets of Mvelaserve Group will be in excess of the liabilities of Mvelaserve Group. that is for at least a period of 12 months from the date of this Pre-listing Statement: • Mvelaserve Group will be able. in the ordinary course of business. For this purpose the assets and liabilities will be recognised and measured in accordance with the accounting policies used by Mvelaserve in its latest audited annual Group financial statements. and • settlement of inter-company loans between Mvela Group and Mvelaserve. which will reflect the growth. in the approximate proportion of one-third and two-thirds of the annual dividend. WORKING CAPITAL STATEMENT The Directors are of the opinion that. There is. 27. it may be declared forfeited by the Directors for the benefit of Mvelaserve. be paid in March and final dividends will be paid in September of each year. MATERIAL CHANGES The material changes in the assets. investment strategy. however. 26. capital requirements and other factors. If a dividend is unclaimed for three years after the payment date. Mvelaserve did not have any material loans receivable outstanding as at 30 June 2010. subject to the Listings Requirements. LOAN CAPITAL AND MATERIAL LOANS Details of the material loans to Mvelaserve as at the Last Practicable Date are set out in Annexure 10 to this Pre-listing Statement. no assurance that a dividend will be paid out and any dividend proposed by the Board in respect of any financial period will be dependent upon the operating results. while maintaining an appropriate dividend cover.5 times will be adopted. It is currently anticipated that most of the cash available and cash generated by the business will be invested in the continued growth of its activities. if declared. to pay its debts. as detailed in Annexure 1. 25. 46 . financial position. and • the working capital of Mvelaserve Group will be adequate for ordinary business purposes. • disposal of Stamford Sales to Mvela Group. including those relating to the Restructuring. respectively. • the ordinary share capital and reserves of Mvelaserve Group will be adequate for ordinary business purposes. It is anticipated that interim dividends will. A target dividend cover of approximately 2.24. There is no fixed date on which entitlement to dividends arises and the date of payment will be determined by the Directors or shareholders at the time of declaration. liabilities and trading position of the Group that have taken place between 30 June 2010 and the Last Practicable Date. DIVIDENDS AND DIVIDEND POLICY The Board intends to adopt a competitive dividend policy. long-term earnings and cash flows of the Group. in order to meet Mvelaserve Group’s present requirements. Relevant extracts of the Articles of Association relating to dividends are set out in Annexure 12 to this Pre-listing Statement. are as follows: • Debt Restructure. No debentures have ever been issued by Mvelaserve. • Mvelaserve’s agreement to acquire the 75% of the issued share capital of Zonke from Mvela Group in terms of the Zonke acquisition.

the Diversified Services business unit performed below the previous year principally due to lower volume in the import/export markets affecting Contract Forwarding. and have been included in the financial results for a full year. This improvement is expected to continue under the current market conditions. The Group has presented pro forma financial information to 30 June 2010. EBITDA increased from R371 million to R448 million. including the historical financial information in Annexure 2 and the pro forma financial information included in Annexure 4 to this Pre-listing Statement. It is expected that the new agreement will have a 20% to 25% negative impact on the profitability of TFMC.509 million the previous year. All transactions are assumed to have been concluded in the financial year ended 30 June 2010. which takes into account the Debt Restructuring and the Restructuring. Catering and Cleaning In 2010. The Customised Solutions pipeline is full of opportunities.PART D: MANAGEMENT’S DISCUSSION AND ANALYSIS CONDITIONS AND RESULTS OF OPERATIONS OF FINANCIAL A brief discussion.. The improvement was principally due to a strong performance by the Assets-in-Transit and guarding divisions. Security Protea Coin revenue for the year ended 30 June 2010 showed a strong improvement on the previous year. per statement of comprehensive income and statement of financial position caption as detailed below. Diversified Services In 2010. Mvelaserve exceeded expectations in the financial year ended 30 June 2010 with revenue increasing by 15% to R4. Mvelaserve Group On a comparable basis (including Zonke). The extension of the Telkom agreement to 31 March 2016 was signed on 12 August 2010. Khuseti showed a strong improvement from the 2009. 47 . The following discussion and analysis should be read together with the rest of the Pre-listing Statement.The divisional restructuring has been finalised and the economies of scale will result in an improvement of the profitability of the combined business in the current financial year (2010/11). Zonke will continue with its current growth and the number of LPM’s are increasing in line with expectations. Facilities Management The performance of TFMC for the year exceeded the previous year’s results. The franchise business. a positive sign to diversify from reliance on the Telkom agreement. During the year the businesses were consolidated under one management and administrative team and the name was changed to Royalserve Catering and Royalserve Cleaning. the cleaning and catering division performed below the previous year.112 million from R3. with in-store numbers in the region of 310 King Pie stores remained flat during the year. and the settling of the inter-company loans between Mvela Group and Mvelaserve Group. of the performance of Mvelaserve for the current and previous financial years ended 30 June 2010 and 30 June 2009.

30. 32. OPERATING PROFIT Years ended (R’000) Unaudited 30 June 2010 pro forma 260 160 Audited 30 June 2010 291 287 +52. 48 .9% Reviewed 30 June 2009 756 040 Operating costs Year-on-year growth Operating expenses decreased at a rate below inflation.8% Reviewed 30 June 2009 3 601 257 Revenue Year-on-year growth Revenue for the year ended 30 June 2010 increased by 13% or R461 million to R4 062 million (2009: R3 601 million).28.7% Reviewed 30 June 2009 1 641 300 Employee costs Year-on-year growth Employee expenses increased as a result of the higher revenue generated by more employees appointed to generate the revenue and increases in salary expenses. The pro forma results include R50 million revenue from Zonke. REVENUE Years ended (R’000) Unaudited 30 June 2010 pro forma 4 111 948 Audited 30 June 2010 4 061 998 +12. and increased as a result of the operational profits of Zonke.83% Reviewed 30 June 2009 190 592 Operating profit Year-on-year growth The improvement in operating profit is due to the increase in revenue and reduction in operating costs. DEPRECIATION Years ended (R’000) Unaudited 30 June 2010 pro forma 104 465 Audited 30 June 2010 103 916 –1.7% Reviewed 30 June 2009 105 717 Depreciation Year-on-year growth Depreciation remained relatively flat year-on-year. The pro forma operating profit decreased because of the listing expenses and the bonuses payable as described above. EMPLOYEE COSTS Years ended (R’000) Unaudited 30 June 2010 pro forma 1 986 075 Audited 30 June 2010 1 932 548 +17. The pro forma employee costs include the bonuses as described above and employee expenses for Zonke. 31. The pro forma operating costs include bonuses payable to Directors and senior managers of Mvelaserve. OPERATING COSTS Years ended (R’000) Unaudited 30 June 2010 pro forma 767 625 Audited 30 June 2010 700 084 –7. 29. listing expenses and operating expenses in relation to Zonke.

1. ANALYSIS OF STATEMENT OF FINANCIAL POSITION 36.1 Property.1. 34. plant and equipment as a result of the expansion of the business in the 2010. plant and equipment The R192 million additions were mainly as a result of the growth in Protea Coin.3% Reviewed 30 June 2009 72 753 Taxation Year-on-year growth Taxation increased as a result of increased profits and the reduction of available tax losses. The total asset finance increased by 34% due to the acquisition of property. The pro forma taxation decreased as a result of the additional taxable expenses incurred. FINANCE COSTS Years ended (R’000) Unaudited 30 June 2010 pro forma 100 397 Audited 30 June 2010 77 943 –29.The pro forma finance costs increased by R22 million in terms of the Restructuring and the Debt Restructure. 36. 36.2 Liabilities The preference share funding remained constant in 2010. 36. Inventories remained flat in the region of R42 million. CASH FLOW ANALYSIS Cash flow for the year showed an increase in line with the overall improvement of the Group.1 Assets 36.5% Reviewed 30 June 2009 110 492 Finance costs Year-on-year growth Finance costs were lower as a result of the decrease in the average interest rate of 4% from 2009 to 2010. 49 . 75% of the additions were for expansion of new business and the remainder for the replacement of assets. TAXATION Years ended (R’000) Unaudited 30 June 2010 pro forma 57 502 Audited 30 June 2010 80 282 10.2 Net working capital Trade and other receivables increased by 7% to R764 million from the previous year which is in line with the increase in revenue. 35. Cash improved by R164 million to R375 million as at 30 June 2010. The preference share funding will be replaced with new debt from Nedbank Limited in terms of the Debt Restructure. Trade and other payables increased 6% to R794 million from the previous year.33.

Mvelaserve’s business. including executive officers and certain other key employees. could reduce demand for its products and services and negatively impact its revenues and profitability.g. retain and motivate the necessary personnel. Mvelaserve Group’s actual results may differ significantly from the results discussed in such forward-looking statements. upon its ability to continue to attract. localised downturns in markets where it has operations. services. growth. such as problematic clients or changes in general economic conditions. The competition for qualified personnel in the industry is strong and there can be no assurance that Mvelaserve Group will be successful in retaining such personnel or attracting replacement personnel. Prospective Investors should carefully consider the risks described below in addition to the other information in this Pre-listing Statement. Although information has been provided in this Pre-listing Statement in relation to the Mvelaserve Ordinary Shares. a Prospective Investor should use his or her own judgement and seek advice from an independent financial adviser as to the appropriate value of the Mvelaserve Ordinary Shares. may not be recoverable on time or at all. The Group’s performance depends to a large extent on the efforts and abilities of its key personnel and employees. Any of the foregoing economic events could negatively affect Mvelaserve Group’s industry or the industries in which its clients operate. in part. resulting in unrecoverable costs and forfeited profit margins and ultimately having an adverse effect on its financial condition or results of operations. Between them. have a knowledge and understanding of Mvelaserve Group and its industry that cannot be readily duplicated in the short-term. Material contract failures may be caused by internal factors. results of operations. results of operations. Mvelaserve Group’s business largely involves contracting with clients. among other things. This Pre-listing Statement contains “forward-looking” statements that involve risks and uncertainties. and may otherwise have a material adverse effect on its results of operations and financial conditions. causing it to lose clients and reduce its revenues. including any downturns in the various industries within which it operates. In the case of material contract failure. These risks include.These executives. The Group is exposed to risks relating to its entrance into large contracts with key clients. strategies and dividend policy could be materially adversely affected by a number of risks. Failure to retain and attract key personnel and qualified employees could impede Mvelaserve Group’s ability to execute its business plan and growth strategy. financial position. 37. strategies and dividend policy. lack of clarity in the scope of work. including any member of Mvelaserve Group’s senior management team. before investing in Mvelaserve Ordinary Shares. Mvelaserve Group is exposed to the risk that disputes may arise with third parties and the outstanding balances due to Mvelaserve Group under the agreements. cleaning and catering industries. Although Mvelaserve Group’s products. including those set out below. clients and industry are designed to limit the Group’s exposure to economic downturns. RISKS RELATED TO MVELASERVE’S BUSINESS Mvelaserve Group’s business is dependent on general economic conditions. Failure to attract and retain such personnel. skills and expertise). including inadequate service and legal risk assessment. financial position. They generally have substantial experience and expertise in their fields of operations and have made significant contributions to the growth of Mvelaserve Group as a whole. Factors that might cause such differences include those discussed below. material contract failure and inadequate contract variation management. Additional risks not presently known to Mvelaserve or that the Directors currently deem immaterial may also adversely affect the Group’s business. growth. The Group believes that its success will continue to depend. Accordingly. then this will negatively affect profitability. and lead to a loss of clients. 50 . along with other key personnel. poor labour productivity or insufficient project management resources (e. and if these agreements result in unrecoverable amounts and/or create disputes. which in some instances may include material amounts. The risks described below are not the only risks faced by Mvelaserve. could have a material adverse effect on Mvelaserve Group’s business by impairing its ability to execute its business plan and growth strategy. Contract failures may be caused by external factors as well. which may cause the demand for Mvelaserve Group’s products and services to decline and therefore harm its revenues and profitability. These risks could also have an adverse effect on the trading price of Mvelaserve Ordinary Shares. the key executives of Mvelaserve Group have years of experience in facilities management. security. The inability to recover amounts owed under large client contracts in a timely manner may affect Mvelaserve Group’s cash flow positions.PART E: RISK FACTORS Investing in the Mvelaserve Ordinary Shares involves risk.

provincial and local Government departments. The South African Government has taken a number of significant steps towards addressing the social and economic problems in South Africa. Many companies in South Africa contracted with the Government. Furthermore. these social and economic problems may have a negative impact on the South African economy and in turn may have an adverse effect on Mvelaserve Group’s South African operations and on its business and financial performance as a whole. Mvelaserve Group’s business could be adversely impacted. particularly through the security. 51 . could adversely affect Mvelaserve Group’s reputation or subject Mvelaserve Group to liability. including Mvelaserve have experienced and may continue to experience significant delays in receiving payments from some of the government departments. In addition. and reductions or delays in these payments or the implementation of other measures to reduce reimbursements from Government may reduce Mvelaserve Group’s revenues. social and economic conditions are relevant to investors in assessing a proposed investment in Mvelaserve Ordinary Shares. financial condition or results of operations. Particular considerations include how the South African Government will ultimately address such tensions and problems. respectively. “fruitless” and “irregular” expenditure as the reason. operations. of which approximately 60% were members of trade unions. In addition. Accordingly. The Directors are confident that the risk of contract cancellation by the clients is low due to the high quality service provided by TFMC and Zonke. A decrease in the quality of services provided by Mvelaserve Group may negatively impact Mvelaserve Group’s reputation. Any such strikes or industrial action in the future may have a material adverse effect on Mvelaserve Group’s business. A portion of Mvelaserve Group’s revenues are dependent on payments from Government. cleaning and catering businesses. In general. Recently. although certain problems still exist. social and economic consequences of such efforts and the effect on South African businesses of the continuing integration of the South African economy with the economies of the rest of the world. social and economic conditions. Government departments may be unable to pay for services in the event of budget deficits or failure to receive funding from the national Government. The Group has a number of contacts with various national. Non-renewal or cancellation of these contracts at the end of the term could result in a significant decrease in the revenue and profitability of Mvelaserve Group. Mvelaserve Group had a total employee workforce of approximately 30 000. Mvelaserve’s business model is dependent on Mvelaserve Group providing quality services and products. or fail to maintain their high standards of client satisfaction. the country’s political. prospects. customers and investors located in South Africa.Mvelaserve Group conducts its business in South Africa which is subject to certain political. financial condition or results of operations. various Government departments have cancelled a number of service contracts. any failure of Mvelaserve employees to maintain high quality service standards. Strikes or other industrial action could impair Mvelaserve Group’s ability to provide services to clients. it has high levels of unemployment. for TFMC and Zonke. the political. Mvelaserve has entered into limited fixed-term agreements with Telkom and the NGB. Any delays or failures by Government to reimburse Mvelaserve Group for services rendered may have a material adverse effect on Mvelaserve’s business. citing budget cuts. the Directors are equally confident that the clients are likely to extend the contracts beyond their current term. The Mvelaserve Group is incorporated in and has its head office. to what extent its efforts will be successful. As at 30 June 2010. Mvelaserve Group businesses have in the past and may in future be subject to strike or industrial action. The fixed-term nature of significant contracts could impair business continuity in some of Mvelaserve Group’s businesses. While South Africa features a highly developed financial and legal infrastructure at the core of its economy. As discussed in paragraph 10 of this Pre-listing Statement headed “The Business of Mvelaserve Limited – Black Economic Empowerment”. The economic direction of South Africa may be influenced by the extent to which the South African Government. BEE is a central part of the South African Government’s economic transformation strategy. poverty and crime. prospects. organised labour and business are able to agree upon common goals and the means of achieving them. South Africa faces many challenges in overcoming substantial inequalities in levels of social and economic development among its people. If the various businesses of Mvelaserve are unable to continue providing quality services to clients. While Mvelaserve Group believes that the economic sentiment is positive for the future.

Strict liability introduced by the CPA exposes suppliers and service providers to a much wider net of potential liability. defects or hazards in any goods. in order to be successful with a claim for damages. results of operations and on prospects. The Competition Amendment Bill. or otherwise take actions which could have a material adverse effect on Mvelaserve Group’s business. or as a result of. including criminalisation provisions and provisions relating to regulation of so called “complex monopolies”.Mvelaserve Group’s operations could be adversely affected by a failure of Mvelaserve Group’s information systems. will introduce significant reforms to the Competition Act. if approved in its current form. delays. and pertaining to any hazard arising from or associated with the use of any goods. the unauthorised release of confidential data or cessations in the availability of systems. Mvelaserve Group is subject to competition and anti-trust laws in South Africa. prospects. arrangement or understanding between firms in order to hold two or more firms liable for market characteristics that indicate co-ordinated conduct between the firms. particularly Protea Coin as it relates to the security industry regulations and firearm licensing requirements. financial condition or results of operations. If Mvelaserve Group is subject to any investigation by or sanctions from the competition authorities in South Africa under the current or any future competition legislation.The occurrence of any of these events could result in interruptions. Section 61 of the CPA establishes a form of “modified strict liability” of producers. 52 . No assurance can be given that the South African Government and/or industry regulatory bodies will not implement new regulations or amend existing regulations. Mvelaserve Group’s business. Any system failure that causes an interruption in service or availability of Mvelaserve Group’s systems could adversely affect operations or delay the collection of revenues. or inadequate instructions or warnings provided to the consumer. the loss or corruption of data. adverse effect on Mvelaserve Group’s business. which do not require an agreement. they are vulnerable to computer viruses. prospects. irrespective of whether the harm resulted from any negligence on the part of the producer. producer or supplier as the case may be. financial condition or results of operations may be materially adversely affected. product failures. or investigation by or sanctions from the competition authorities in other jurisdictions. distributors or retailers in respect of harm caused by. distributor or retailer. and Zonke as it relates to the gambling regulations. financial conditions. importers. Certain of Mvelaserve Group’s businesses operate in highly regulated industries.This is a significant departure from the existing common law in terms of which a consumer generally has to prove fault (negligence) on the part of the manufacturer. importer. Certain of Mvelaserve Group’s businesses operate in highly regulated industries. Mvelaserve Group may in the future be subject to competition or anti-trust laws which may adversely affect its business. Although reasonable measures are in place to safeguard Mvelaserve’s servers. the supply of any unsafe goods. break-ins and similar disruptions from unauthorised tampering. operations or financial condition. all of which could have a material.

if a body corporate. Provided that. to every such general meeting. such quorum is not present. Set out in Annexure 12 to this Pre-listing Statement are extracts from the Articles of Association dealing with the rights of holders of Mvelaserve Ordinary Shares to dividends. and on a poll every shareholder present in person or by proxy shall be entitled to that proportion of the total votes in Mvelaserve which the aggregate amount of the nominal value of the Ordinary Shares held bears to the aggregate amount of the nominal value of all the Ordinary Shares issued by Mvelaserve. no securities have been issued by Mvelaserve nor listed on any other stock exchange. In terms of the Articles of Association. SHARE CAPITAL The authorised and issued share capital of Mvelaserve on the Listing Date will be as follows: (R) Authorised share capital 500 000 000 no par value ordinary shares Issued share capital 141 561 673 no par value ordinary shares Total issued stated capital No Mvelaserve subsidiary holds any of the issued share capital as treasury shares. All authorised and issued Mvelaserve Ordinary Shares will be of the same class and will rank pari passu in every respect. duly represented by an authorised representative). subject to the provisions of sections 221 and 222 of the Companies Act and the Listings Requirements. at a general meeting of the shareholders of Mvelaserve every shareholder present in person or by proxy (or. There are no founders’ or deferred shares. vendor. Accordingly. Director or other person. Mvelaserve has not issued any debentures. There are no preferential conversion and/or exchange rights attached to any Mvelaserve securities In terms of the Articles of Association. Other than the Mvelaserve Ordinary Shares which are expected to be listed on the JSE. including rights on liquidation and distribution of capital assets.PART F: SHARE CAPITAL 38. No special voting powers are reserved to any founder. a Mvelaserve Ordinary Shareholder will have one vote for each Mvelaserve Ordinary Share of which that person is the registered holder. provided further that if at any adjourned meeting. the shareholders present shall form a quorum In accordance with the Articles of Association. No Mvelaserve Ordinary Shares will be listed on any securities exchange other than the JSE. profits and/or capital. The unissued Mvelaserve Ordinary Shares are under the control of the Directors. shall have one vote on a show of hands. a dividend which remains unclaimed after a period of three years from the payment date may be declared forfeited by the Directors for the benefit of Mvelaserve – – – 53 . all the provisions of the Articles of Association relating to general meetings shall mutatis mutandis apply except that the quorum shall be not less than 3 (three) persons holding or representing by proxy not less than 51% (fifty-one percent) of the Mvelaserve Ordinary Shares. any variation of the rights attaching to the Mvelaserve Ordinary Shares will either require the consent of the Mvelaserve Ordinary Shareholders holding at least three-fourths of the Mvelaserve Ordinary Shares or with a sanction of a resolution passed in the manner prescribed in the Companies Act or the passing of a special resolution in a general meeting of the Mvelaserve Ordinary Shareholders. for so long as all the Ordinary Shares issued by Mvelaserve have the same nominal value.

and • On or about 7 October 2010. consisting of 794 560 000 ordinary shares of R0. 55 254 736 Mvelaserve Ordinary Shares were issued to Mvela Group at a subscription price of R653 287 804 which was applied by Mvelaserve in the net settlement of the inter-company loans between Mvelaserve and Mvela Group. Mvelaserve converted its entire authorised and issued share capital from ordinary shares with a par value of R0. by implementing a share split of each share of R1 each into 794 560 Ordinary Shares of R0. Mvelaserve cancelled 294 560 000 ordinary shares from the authorised share capital of Mvelaserve. whereby an option or preferential right of any kind is (or is proposed to be) given to any person to subscribe for any Mvelaserve Ordinary Shares. issued. For the past three years prior to the date of this Pre-listing Statement. by Mvelaserve or any of its Subsidiaries to any person. 6 850 937 Mvelaserve Ordinary Shares were issued as consideration for the Zonke acquisition. OPTIONS OR PREFERENTIAL RIGHTS IN RESPECT OF SHARES Neither Mvelaserve nor any of its Subsidiaries are party to any contract or arrangement (or proposed contract or arrangement). 42. are further salient details relating to the Zonke acquisition. to ordinary shares with no par value.00012585581957 each each. other than for cash. other than the Ordinary Shares issued by Mvelaserve as already mentioned in this Pre-listing Statement. no share premium has been paid in respect of any Mvelaserve Ordinary Shares and Mvelaserve has not repurchased any Mvelaserve Ordinary Shares. to the value of R81 000 000. 41.00012585581957 each. consisting of 1 000 ordinary shares of R1 each. • On or about 7 October 2010. 62 105 673 Mvelaserve Ordinary Shares of no par value were issued to Mvela Group. ALTERATIONS TO SHARE CAPITAL IN THE PAST THREE YEARS Set out below are the alterations to the ordinary share capital of Mvelaserve which have occurred during the past three years: • On or about 7 October 2010. or agreed to be issued. no Mvelaserve Ordinary Shares were. The total value of the premium was R80 999 138. and the issued ordinary share capital of R100. 40. such that the total authorised share capital consisted of 500 000 000 Ordinary Shares of R0. ORDINARY SHARES ISSUED OTHERWISE THAN FOR CASH Save as set out in the preceding paragraph.00012585581957 each. Mvelaserve altered each share in the entire authorised capital of R1 000. within the three years preceding the date of this Pre-listing Statement. consisting of 79 456 000 ordinary share of R0. 54 .39. • On or about 7 October 2010. thus increasing the authorised number of shares to capital of R1 000.00012585581957 each. consisting of 100 ordinary share of R1 each.00012585581957 each. • On or about 7 October 2010. PREVIOUS OFFERS There have been no bona fide offers for sale or sale of any Mvelaserve Ordinary Shares or any of its Subsidiaries which have been acceptable to the board of Mvela Group during the three years prior to the date of issue of this Pre-listing Statement. and the issued ordinary share capital of R100. As part of the Restructuring. as illustrated below: Number of Ordinary Shares held 6 850 937 55 254 736 62 105 673 Value of transaction R 81 000 000 653 287 804 734 287 804 Shareholder Zonke acquisition Net settlement of inter-company loans Total Set out in Annexure 1 to this Pre-listing Statement.

symbol “MVS” and ISIN: “ZAE000151353”. generally in terms of the rules of Strate. • trades executed on the JSE must be settled within five Business Days. to receive and hold the Ordinary Shares in Dematerialised form on their behalf. the Mvelaserve Ordinary Shares will be available to Prospective Investors in Dematerialised form only. Prospective Investors who are resident outside the Common Monetary Area should seek advice as to whether any governmental and/or other legal consent is required and/or whether any other formality must be observed to enable investing in the Mvelaserve Ordinary Shares. 45. to its Ordinary Shareholders. EXCHANGE CONTROL REGULATIONS Currency and shares are not freely transferable from South Africa to any jurisdiction falling outside the geographical borders of South Africa. it will have to materialise its Mvelaserve Ordinary Shares by contacting and informing its CSDP to do so.PART G: PARTICULARS OF THE LISTING 43. the investor is entitled to instruct the Participant or broker (or the Participant’s or broker’s nominee company).strate. all Prospective Investors must appoint a CSDP.co. STRATE Ordinary Shares may only be traded on the JSE in electronic form (Dematerialised Ordinary Shares) and will be trading for electronic settlement in terms of Strate immediately following the Listing. Accordingly. will be the shareholder (member) of the relevant company and not the investor. holding shares on their behalf. their Participant’s or broker’s nominee company. Participants or other appropriate adviser and you are referred to the Strate website at http://www. Mvela Group will distribute 100% of the Ordinary Shares it holds in Mvelaserve. 55 . directly or through a broker.za Some of the principal features of Strate are as follows: • electronic records of ownership replace share certificates and physical delivery of certificates. including the risk of loss or tainted script. which are no longer covered by the JSE Guarantee Fund. LISTING OF MVELASERVE ORDINARY SHARES ON THE JSE Subject to the fulfilment of the conditions precedent set out in the “Salient Information” section of this Pre-listing Statement. This will ensure that the spread requirements detailed in the Listings Requirements are fulfilled. Should a shareholder require a physical share certificate for its Mvelaserve Ordinary Shares. If you have any doubt as to the mechanics of Strate please consult your broker. as to how it wishes to exercise the rights attaching to the Ordinary Shares and/or to attend and vote at meetings of Mvelaserve Ordinary Shareholders. DEMATERIALISATION OF MVELASERVE ORDINARY SHARES Once listed. other than jurisdictions falling within the Common Monetary Area and must be dealt with in terms of the Exchange Control Regulations of the South African Reserve Bank as described more fully in Part H of this Pre-listing Statement. and • unless investors owning Dematerialised Ordinary Shares specifically request their Participant to register them as an “own name” shareholder (which entails a fee). 44. The Exchange Control Regulations also regulate the acquisition by former residents and nonresidents of Mvelaserve Ordinary Shares. Strate is a system of “paperless” transfer of securities. Subject to the agreement between the investor and the Participant or broker (or the Participant’s or broker’s nominee company). 46. the JSE has approved the Listing of all the Mvelaserve Ordinary Shares in the “Business Support Services” sector of the JSE lists under the abbreviated name “Mvelasv”. Following the Listing. • all investors owning Dematerialised Ordinary Shares or wishing to trade their securities on the JSE are required to appoint either a broker or a Participant to act on their behalf and to handle their settlement requirements. It is noted that there are risks associated with holding shares in certificated form. All Mvelaserve Ordinary Shareholders who elect to convert their Ordinary Shares from Dematerialised form into Certificated form will have to Dematerialise their Mvelaserve Ordinary Shares should they wish to trade them under the terms of Strate (see paragraph 46 below headed “Strate “ in this Pre-listing Statement).

This is determined with reference to the number of days spent by the individual in South Africa during a six-year period. as well as for a period or periods exceeding 91 days in aggregate during each of the five years of assessment preceding such year of assessment. The South African Revenue Authorities have indicated that the place of effective management is the place where the company is managed on a regular or day-to-day basis by the directors or senior managers of the company. Should a person meet both tests. Generally. but excludes any day that the person is in transit through South Africa between two places outside South Africa and such person has not formally entered South Africa. 56 . It is not an exhaustive description of all the possible tax consequences of any purchase. including. ownership and disposal of Ordinary Shares in light of their particular circumstances. Residents of South Africa are taxed on their world-wide income and capital gains. close corporation and trust) As regards legal persons. 47. If the management functions are executed at a single location. or where the board of directors meets. regional. It has been indicated that the following facts and circumstances must be considered to determine the effective management of a company: – where the centre of top-level management is located. the location will be the place of effective management. and • for a period or periods exceed 915 days in aggregate during those five preceding years of assessment.2 Legal persons (company. it should be read in conjunction with the provisions of any applicable double tax convention between South Africa and their country of tax residence. local or other tax laws. and therefore its meaning is determined according to guidelines established by the courts. in particular. 47. A natural person would meet the physical presence test if he is physically present in South Africa: • for a period or periods exceeding 91 days in aggregate during the relevant year of assessment. “the country to which he would naturally and as a matter of course return from his wandering. A day includes a part of day. In the case of persons who are non-residents of South Africa for fiscal purposes. or – the requirements of the physical presence test are met. TAXATION ISSUES The following summary describes certain tax consequences of the purchase. a person’s ordinary residence will be. irrespective of where the overriding control is exercised. – location of and functions performed at the headquarters.1 Individuals An individual will be a resident of South Africa for tax purposes if: – such individual is ordinarily resident in South Africa. ownership and disposition of the Ordinary Shares. ownership or disposition. the effect of any state.PART H:TAX AND EXCHANGE CONTROL 47. Investors should consult their own advisers as to the tax consequences of the purchase. he will be deemed to be a resident from a tax perspective with effect from the first day of the relevant year of assessment in which the two tests have been met.1. established or formed in South Africa or which has its place of effective management in South Africa.1. a resident is defined in the Income Tax Act as any person which is incorporated. whereas non-residents are taxed only on income and certain capital gains sourced in South Africa or deemed to be from a source in South Africa. 47. as contrasted with other lands it might be called his usual or principal residence and it would be described more aptly than other countries as his real home” (Cohen v CIR 13 SATC 362). This term is not defined in the Income Tax Act.1 Residence based system of taxation Since 1 January 2001 South Africa has moved from a largely source based to a residence based system of taxation. This summary is based on the laws as in force and as applied in practice on the date of this Pre-listing Statement and is subject to changes to those laws and practices subsequent to the date of this Pre-listing Statement. Reference can be made to ‘Income Tax Interpretation Note 6 – Resident: Place of Effective Management’ – issued on 26 March 2002 which details the approach adopted by the South African Revenue Service.

47. Dividends Tax will be imposed in respect of any dividend paid by a company on or after the effective date referred to above.4 Proposed Dividends Tax The STC regime is set to be replaced with a new Dividends Tax Legislation. A distribution of share premium or share capital in these circumstances can.1. This rate may be reduced to as low as 5% under the provisions of certain double tax conventions. The new Dividends Tax Legislation has been enacted. except to the extent that the distribution represents a reduction in the share premium or share capital account of the company and such amounts do not comprise of any amounts transferred from profits. In addition.3 Secondary Tax on Companies Under current law. – where the directors or senior managers reside. which will constitute a withholding tax imposed at a shareholder level. the location of the registered office and public officer. – the actual activities and physical location of senior employees. the Group will be subject to a tax known as STC on the net amount of any dividends declared by it. This date has not yet been determined. including amounts distributed by a company to acquire. and will be levied at a rate of 10%. however. or as consideration for the acquisition of any share in that company. be deemed to be a distribution of profits to shareholders of a particular class to the extent that the share capital and share premium so reduced exceeds the share capital and share premium contributed by that class of shareholders. formation or establishment. which date must be at least three months after the date of such notice. dividends paid by the Group to South African Ordinary Shareholders and non-South African Ordinary Shareholders will be exempt from South African income tax in their hands. are generally considered to be dividends. 47. – legal factors such as the place of incorporation. the Dividends Tax Legislation includes a number of exemptions. in the sense that the OECD has indicated that one should consider the place where key management and commercial decisions are taken as opposed to the operational execution of decisions.2 Dividend income Currently. cancel or redeem its own shares. The STC rate is currently 10%. the new definition of “dividend” will be any amount transferred or applied by a company for the benefit of any shareholder by virtue of any share held by that shareholder in that company.3 General proviso regarding treaty resident persons The Income Tax Act excludes from the definition of resident all persons (legal or natural) that are deemed to be exclusively resident in another country in terms of a double tax convention for the avoidance of double taxation to which South Africa has concluded. and – the nature of powers conferred upon representations of the entity. – where controlling shareholders make key management and commercial decisions in relation to the company. – the experience and skills of the directors and managers. whether by way of a distribution. 47. In general. The approach adopted by the South African Revenue Authorities may differ from the interpretation attached to this concept by the OECD. 47. but is expected to be around late 2011.– where the business operations are actually conducted. Once effective. – the frequency of the meetings of the company’s directors or senior managers and where they take place. including exemptions for onshore inter-company dividends and dividends paid to certain exempt entities. 57 . – the scale of onshore as opposed to offshore operations. but will only become effective from a date to be determined by the Minister of Finance by notice in the Gazette. any amounts distributed by a company and funded out of profits or reserves to its shareholders.

an open market purchase by a listed company of its own shares on the exchange operated by the JSE will not constitute a dividend.5 Distributions of share premium A distribution by a company of share premium (or CTC in terms of the new Dividends Tax Legislation) does not/will not constitute a dividend for STC/Dividend Tax purposes. unless the shares are bequeathed to. such amount will constitute a part disposal and thus “proceeds” in the South African shareholders’ hands for CGT purposes. less allowable losses in a year of assessment. is subject to tax at the individual’s marginal tax rate (maximum 40%) to the extent that it exceeds the annual exclusion (R17 500 for the years of assessment ended ending 28 February 2011). 47. together with other capital gains. A shareholder’s base cost in the shares will generally be the consideration paid for the shares. Deemed disposals to a surviving spouse. CTC. dividends will not include redemptions of a participatory interest in a foreign collective investment scheme. Non-South African resident shareholders – individuals and corporates A disposal of shares by a non-South African resident would give rise to a gain (or loss) for the purposes of CGT to the extent that the gains are realised pursuant to the disposal of any interest in immovable property situated in South Africa. resulting in a maximum effective tax rate on capital gains of 14%. amounts resulting in a reduction of contributed tax capital (“CTC”) (as described below) will not constitute a dividend. to the extent that such amounts are not otherwise allowable for deduction in the determination of taxable income. The portion of the base cost to be deducted in this regard is the same ratio thereof as the market value of the distribution bears to the market value of the shares prior to the distribution. A gain on a disposal of shares. gives up South African tax residence) there will also be a deemed disposal of the shares at market value and this will trigger CGT. A capital gain on a disposal of shares by a corporate shareholder. Where a taxpayer emigrates (i. if the shares are listed on the JSE. who is a South African resident. The South African shareholder will be treated as having partly disposed of their shares in these circumstances. transfer costs brokerage or legal adviser’s fees. in its basic form. as taking place at no gain or loss. A shareholder’s base cost in the shares will generally be the consideration paid for those shares. resulting in a maximum effective tax rate on capital gains of 10%. A pro rata portion of the South African shareholders’ base cost for their shares will be deducted against such deemed “proceeds”. less allowable capital losses in a year of assessment. transfer costs brokerage or legal adviser’s fees. An interest in immovable property situated in South Africa includes shares if: 58 . On the death of a taxpayer.The new “dividend” definition will contain four exclusions. there is a deemed disposal of the shares at market value. will comprise amounts received or accrued by a company as consideration for the issue of its shares. and costs directly incurred in the buying or selling thereof such as securities transfer tax. or in favour of. if the shares are listed on the JSE.6 Capital Gains Tax South African resident shareholders – Individuals A disposal of shares by an individual shareholder who is resident in South Africa for tax purposes will give rise to a gain (or loss) for the purposes of CGT. Instead. dividends will not include capitalisation awards. Only 25% of the net capital gain is included in taxable income. The capital gain (or loss) on disposal of the shares is equal to the difference between the disposal proceeds and the base cost. 47. First. are treated. if the shares are held on capital account. with the net amount being subject to CGT. Lastly. Only 50% of the net capital gain is included in taxable income. The annual exclusion where death occurs during the year of assessment ending 28 February 2011 is R120 000. Second. Third. together with other capital gains. The capital gain (or loss) on disposal of the shares is equal to the difference between the disposal proceeds and the base cost. is subject to tax at the normal tax rate for companies (currently 28%). to the extent that such amounts are not otherwise allowable for deduction in the determination of taxable income. This would therefore typically be share capital and share premium (excluding any portion thereof which comprises capitalised reserves). The base cost in the shares may be increased by one-third of any interest incurred to finance the cost of acquiring the shares. South African resident shareholders – Corporates A disposal of shares by a South African resident corporate shareholder may give rise to a capital gain (or loss) for the purposes of taxation of capital gains.e.The base cost in the shares may be increased by one-third of any interest incurred to finance the cost of acquiring the shares. a surviving spouse. and costs directly incurred in the buying or selling thereof such as securities transfer tax. in practical effect.

Estate duty is levied at a flat rate of 20% on the dutiable amount of the deceased estate to the extent that it exceeds R3. Currently not more than 80% of the market value of the shares of the Group is attributable to immovable property and consequently the part disposal of the Mvelaserve Ordinary Shares will not fall within the ambit of the South African Capital Gains Tax legislation. A purchase of shares from or through the agency of a JSE-registered broker is subject to STT of 0. The STT is payable by the broker. directly or indirectly holds at least 20% of the shares. If shareholders are in any doubt regarding South African Exchange Control Regulations. deductions are.• 80% or more of the market value of the shares. the market value of such shares will be included in the estate.9 Corporate tax The corporate tax rate is 28% of taxable income. which may recover it from the transferee. 47. and estate liabilities. STT of 0. but the change in beneficial ownership is effected by a Participant. is attributed directly or indirectly to immovable property held otherwise than as trading stock. The nature of the proceeds will depend on the intention of the shareholder. 47.5 million per estate.10 Value-Added Tax The transfer of shares is not subject to value-added tax as it constitutes a financial service which is an exempt supply. The proceeds will be deemed to be on capital account if the shareholder had been the owner of the shares for a continuous period of at least three years. which may recover it from the transferee. The South African Exchange Control Regulations also regulate the acquisition of shares by former residents and non-residents. The following summary is intended as a guide and is therefore not comprehensive. EXCHANGE CONTROL Currency and shares are not freely transferable from South Africa to any jurisdiction falling outside the geographical borders of South Africa. 48. inter alia. and must be dealt with in terms of the South African Exchange Control Regulations as described below.8 Securities transfer tax Securities transfer tax (“STT”) of 0. In any other case of a change in beneficial ownership of shares.25% of the applicable taxable amount is payable in respect of every “transfer” of securities issued by a company incorporated in South Africa. they should please consult their professional adviser.25% of the greater of the declared purchase consideration or the JSE closing price of shares on the date of the transaction is payable by the Participant. 59 . In determining the dutiable amount of an estate. “Transfer” includes any cancellation or redemption of a security. Prospective Investors who are resident outside the Common Monetary Area should seek advice as to whether any governmental and/or other legal consent is required and/or whether any other formality must be observed to enable an investment in listed Mvelaserve Ordinary Shares. other than jurisdictions falling within the Common Monetary Area. Where Shares are not purchased from or through the agency of a broker. which holds the shares in custody. and • the shareholder (alone or together with any connected person in relation to that shareholder). at the time of disposal. STT of 0.7 Estate duty Where a person who is ordinarily resident in South Africa holds shares at the date of his or her death.25% of the purchase consideration. but does not include the issue of a security or any event that does not result in a change in beneficial ownership of a security. 47. 47. allowed for the value of bequests and property left to a surviving spouse.25% of the greater of the declared purchase consideration or the JSE closing price of Shares is payable by the transferee through the broker or Participant. Deemed capital gain The proceeds from the disposal of shares may be on capital or revenue account. including Capital Gains Tax paid on the deemed disposal of the shares on date of death.

UNBUNDLING Foreign Shareholders 49. including the Unbundling. Any foreign shareholder who is in doubt as to his position with respect to the Unbundling in any jurisdiction. such shares are to be lodged on behalf of the ineligible foreign shareholders with a trust company to be nominated by the Mvelaserve Board in its sole discretion and to be held by the said company on behalf of the ineligible foreign shareholders. The Mvelaserve Board recommends the following mechanism for distribution of any of the Mvelaserve Ordinary Shares to ineligible foreign shareholders. foreign shareholders must take their own advice on whether they are entitled to beneficially hold any Mvelaserve Ordinary Shares unbundled and distributed to them and take the appropriate action in accordance with that advice. Such foreign shareholders should inform themselves about and observe any applicable legal requirements of such jurisdictions in relation to all aspects of this Pre-listing Statement that may affect them. In particular. foreign shareholders may be affected by the Unbundling. 49. 48. exchange or other consents or the making of any filings which may be required. including Exchange Control Regulations.2 Shareholders resident outside the Common Monetary Area • A person who is not resident in the Common Monetary Area. the compliance with other necessary formalities and the payment of any issue. • All share certificates issued to non-residents of South Africa will be endorsed “non-resident” in accordance with the South African Exchange Control Regulations.1 Emigrants from the Common Monetary Area • A former resident of the Common Monetary Area who has emigrated from South Africa may use blocked Rand accounts to acquire Mvelaserve Ordinary Shares. will be similarly marked as being held by an “emigrant”. without limitation. Having regard to prevailing laws in their relevant jurisdictions. Foreign shareholders may be prohibited from beneficially holding any of the Mvelaserve Ordinary Shares unbundled and distributed to them. • All Mvelaserve Ordinary Shares issued to Dematerialised shareholders. It is the responsibility of each foreign shareholder to satisfy itself as to the full observation of the laws and regulatory requirements of the relevant foreign jurisdiction in connection with the Unbundling. should consult an appropriate professional adviser in the relevant jurisdiction without delay. its tax status. including. • Share certificates issued in respect of Mvelaserve Ordinary Shares acquired with blocked Rand will be endorsed “emigrant” in accordance with the South African Exchange Control Regulations. transfer or other taxes or other requisite payments due in such jurisdiction.1 General The Unbundling is governed by the laws of South Africa and is subject to all applicable laws and regulations. to be disposed of by them for the benefit of the ineligible foreign shareholders so as to comply with the regulatory restraints of such jurisdictions. The CSDP or broker through whom the shareholders have Dematerialised their shares will ensure that they adhere to the South African Exchange Control Regulations. 49. Share certificates will be placed under the control of the authorised dealer through whom the payment was made. including an immigrant not using blocked Rand. should obtain advice as to whether any governmental and/or other legal consent is required and/or whether any other formality must be observed in order to buy Mvelaserve Ordinary Shares.48. In the case of any of such Ordinary Shares which an ineligible foreign shareholder is taking transfer of.2 Ineligible Foreign Shareholders Foreign shareholders in certain jurisdictions outside of South Africa may not be entitled to take transfer any of Mvelaserve Ordinary Shares unbundled by Mvela Group. including the obtaining of any governmental. • Mvelaserve Ordinary Shares issued to a Dematerialised shareholder whose registration as a shareholder has been marked as being an “emigrant”. 60 . whose registration has been so endorsed will be endorsed “non-resident” in accordance with the South African Exchange Control Regulations.

• the distribution by Mvela Group will not be deemed to be a dividend for STC purposes. Certificated shareholders will be required to Dematerialise such share certificate in order to sell such Mvelaserve Ordinary Shares on the JSE. Certificated Mvela Group Ordinary Shareholders recorded in the register on the Record Date for the Unbundling will receive a share certificate for the Mvelaserve Ordinary Shares distributed to them.Subject to the above. 49. Excluded foreign Mvelaserve Ordinary Shareholders will. Dematerialised shareholders recorded on the register on the Record Date will have their accounts at their CSDP or broker credited with the Mvelaserve Ordinary Shares due to them on 6 December 2010. the trust company will be requested to coordinate the disposal of any the Mvelaserve Ordinary Shares on behalf of such ineligible foreign shareholders for cash in South Africa and distribute the cash proceeds therefrom (net of applicable fees. and • the Mvelaserve Ordinary Shares are deemed to have been distributed first from the share premium account of Mvela Group.3 Procedure and Implementation of the Unbundling Subject to the fulfilment of all the conditions precedent as set out in the Pre-listing Statement and subject to an ordinary or special resolution being passed by the requisite majority of Mvela Group shareholders entitled to vote thereon. Because the shares in Mvelaserve will be listed on the JSE before the Unbundling. Such shareholders are referred to paragraph 48. Shareholders should therefore. Should the share premium prove to be insufficient. The Unbundling will be effected on or about 6 December 2010. The Unbundling will amount to a payment in terms of section 90 of the Companies Act and be in accordance with Article 13E of the articles of association of Mvela Group and section 46 of the Income Tax Act. approving of the distribution and unbundling of Mvela Group’s entire shareholding in Mvelaserve in proportion to their respective shareholding. Effectively. 61 . the requirement is that the unbundled shares in Mvelaserve must constitute more than 25% shares in Mvela Group in the case where no other shareholder holds an equal or greater amount of equity shares in the unbundled company. Pursuant to the unbundling provisions contained in section 46 of the Income Tax Act: • Mvela Group must disregard the distribution of the Mvelaserve Ordinary Shares for purposes of determining its taxable income or assessed loss. Ineligible foreign shareholders in certain jurisdictions outside of South Africa may not be entitled to take transfer of the unbundled Mvelaserve Ordinary Shares in terms of the Unbundling. Mvela Group nor their advisers will be held responsible. Mvela Group shall unbundle to all Mvela Group Ordinary Shareholders. in respect of their entitlement to the unbundled Mvelaserve Ordinary Shares. registered at the close of business on the Record Date its entire shareholding in Mvelaserve in proportion to their shareholding. in proportion to such ineligible foreign shareholders’ entitlement to unbundled Mvelaserve Ordinary Shares. sent to their registered postal address by registered mail on or about 6 December 2010. for which neither Mvelaserve. Mvela Group will distribute its entire shareholding of Mvelaserve Ordinary Shares to the Mvela Group Ordinary Shareholders in accordance with the effective interest of the Mvela Group Ordinary Shareholders in Mvela Group. firstly out of existing share premium. at their risk. legal or tax advice. TAX CONSEQUENCES IN RESPECT OF THE UNBUNDLING Set out below is a guide only and is not intended to be a complete analysis of the tax implications of the proposed settlement incorporating the Unbundling. in proportion to their respective shareholding. the relevant requirements of the unbundling provisions will thus be met. The Mvelaserve Ordinary Shares held by Mvela Group will be distributed to Mvela Group Ordinary Shareholders in terms of an unbundling transaction as envisaged in section 46 of the Income Tax Act. The average consideration per unbundled Mvelaserve Ordinary Share due to each excluded foreign Mvelaserve Ordinary Shareholder will only be paid once all such unbundled Mvelaserve Ordinary Shares have been disposed of. consult their own tax advisers on the tax consequences of the proposed settlement in both South Africa and their jurisdiction of residence. Given the fact that the Mvelaserve Ordinary Shares to be distributed by Mvela Group to the Mvela Group Ordinary Shareholders will constitute 100% of the entire issued shares in the share capital of Mvelaserve. It is not intended to be. receive the average consideration per unbundled Mvelaserve Ordinary Share (net of transaction and currency conversion costs). expenses. There can be no assurance as to what price such ineligible foreign shareholders will receive from the disposal of such unbundled Mvelaserve Ordinary Shares or the timing or exchange rate conversion of such receipt. Corporate roll-over relief is afforded to Mvela Group and the Mvela Group Ordinary Shareholders to the extent that one meets the relevant requirements as set out in section 46 of the Income Tax Act. nor should it be considered to be. 50. taxes and charges) to ineligible foreign shareholders.2 of this Pre-listing Statement for the procedure thereon. reserves will be applied to the extent necessary.

given the fact that the public officer of Mvela Group will make a sworn affidavit that the transfer of the Mvelaserve Ordinary Shares complies with the provisions of section 46 of the Income Tax Act. An Mvela Group Ordinary Shareholder must determine the portion of the combined expenditure. to be determined. in respect of which the Mvelaserve Ordinary Shares in C were received. of the Mvela Group shares as well as the Mvelaserve Ordinary Shares. 50. who are non-resident for tax purposes in South Africa. 20% or more of the Ordinary Shares in Mvelaserve are held by a so-called disqualified persons either alone or together with any connected person in relation to the disqualified person. will be deemed not to be a dividend declared by Mvela Group or a dividend received by an Mvela Group Ordinary Shareholder who is a company in determining their respective STC liabilities. the Unbundling may constitute a taxable transaction in any other such jurisdiction. as at the end of the day after the distribution. A disqualified person is amongst others defined as a non-resident or certain exempt entities. no STC credits will be available to Mvela Group Ordinary Shareholders as a result of the Unbundling. Mvela Group Ordinary Shareholders. Accordingly. Mvela Group Ordinary Shareholders must determine a new base cost for the Mvela Group Ordinary Shares as well as the Mvelaserve Ordinary Shares received in terms of the Unbundling process. as at the close of the day of the Unbundling. as follows: A = B x [ C / (C + D) ] where: A = the expenditure of the Mvelaserve Ordinary Shares.2 STC The distribution of the Mvelaserve Ordinary Shares to Mvela Group Ordinary Shareholders. C = the market value of the Mvelaserve Ordinary Shares received pursuant to the Unbundling as at the close of the day of the Unbundling date. 25 of 2007. as amended. as contemplated above.1 Disposal of Mvelaserve shares by Mvela Group The distribution of Mvelaserve Ordinary Shares by Mvela Group. The unbundling provisions will apply automatically and it is not necessary to make any specific election to such effect. Mvela Group has not attempted to qualify the Unbundling as a tax-free transaction to shareholders in terms of the rule of any jurisdiction other than South Africa. 62 . are advised to consult their professional advisers as regards the tax treatment of the Unbundling in light of the tax laws in their respective jurisdictions and double tax conventions between South Africa and their countries of tax residence. section 22(1) or section 22(2) of the Income Tax Act.3 Mvela Group Ordinary Shares held as trading stock Any Mvela Group Ordinary Shareholder holding Mvela Group Ordinary Shares as trading stock will be deemed to acquire the unbundled Mvelaserve Ordinary Shares as trading stock. immediately after the distribution of the Mvelaserve Ordinary Shares. in terms of the Unbundling. bears to the sum of the market value. as contemplated in section 11(a). 50. as at the end of that day. The combined expenditure of such Mvela Group Ordinary Shares and Mvelaserve shares will be the amount originally taken into account by the shareholder in respect of the original Mvela Group Ordinary Shares held by that shareholder. as above. attributable to the Mvelaserve Ordinary Shares. B = the combined expenditure.Attention is drawn to the fact that the Unbundling provisions do not apply if. will be disregarded by Mvela Group in determining its taxable income or assessed loss in the tax year that the unbundling takes place and the Mvelaserve Ordinary Shares are deemed to have been distributed first from the share premium account of Mvela Group and thereafter from reserves. The concessions provided for in section 46 are outlined below: 50. No. Effectively. The transfer of the Mvelaserve Ordinary Shares will also not be subject to securities transfer tax in terms of section 8(1)(a) of the Securities Transfer Tax Act. Pursuant to the Unbundling. and D = the market value of the Mvela Group Ordinary Shares. Consequently. the new base cost is determined in accordance with the ratio that the market value of the unbundled Mvelaserve Ordinary Shares. in terms of the Unbundling.

C = the market value of the Mvelaserve Ordinary Shares received pursuant to the Unbundling as at the close of the day after the Unbundling date. will be apportioned between the Mvelaserve Ordinary Shares and the Mvela Group Shares. being the result of [ C / (C + D) ]. in terms of paragraph 20 of the Eighth Schedule. 1 December 2010. as contemplated in paragraph 29 of the Eighth Schedule. to be determined. The original expenditure incurred in respect of the Mvela Group Ordinary Shares. Effectively. as follows: A = B x [ C / (C + D) ] where: A = the deemed expenditure and. to be determined. The expenditure to be allocated to the unbundled Mvelaserve Ordinary Shares will be determined by applying a specified ratio to the cost of the Mvela Group Shares. as follows: E=B–A where: E = the revised expenditure and. as at the close of the day after the Unbundling date. as at the end of that day. CGT valuation of the Mvela Group Ordinary Shares. in respect of which the Mvelaserve Ordinary Shares in C were received prior to Unbundling. A Mvela Group Ordinary Shareholder must determine the portion of the original expenditure incurred in respect of the Mvela Group Shares and (where applicable) the CGT valuation of the Mvela Group Shares attributable to the Mvela Group Shares contemplated in D above. in respect of which the Mvelaserve Ordinary Shares in “C” above were received. as above.4 New base cost Pursuant to the unbundling.An Mvela Group Ordinary Shareholder must determine the portion of the combined expenditure attributable to the Mvela Group ordinary shares contemplated in D above. as determined above. the new base cost is determined in accordance with the ratio that the market value of the unbundled Mvelaserve Ordinary Shares. and (where applicable). the CGT valuation of the Mvela Group Shares. and 63 . where applicable. where applicable. Mvela Group will advise Mvela Group Ordinary Shareholders of the specified ratio. where applicable. as at the end of the day after the distribution. as follows: E=B–A where: E = the revised expenditure of the Mvela Group Shares. to be determined. Any expenditure allocated to the Mvelaserve Ordinary Shares must be deemed to have been incurred on the date that the expenditure was incurred in respect for the Mvela Group Shares. B = each of the original expenditure incurred and. CGT valuation of the Mvela Group Shares. B = the combined expenditure. and A = the expenditure of the Mvelaserve Ordinary Shares. deemed CGT valuation of the Mvelaserve Ordinary Shares. and D = the market value of the Mvela Group Shares. by way of an announcement to be released on SENS on or about Wednesday. Mvela Group Ordinary Shareholders must determine a new base cost for CGT purposes for the Mvela Group Shares as well as the Mvelaserve Ordinary Shares received in terms of the unbundling process.5 Mvela Group Ordinary Shares held as capital assets Any Mvela Group Ordinary Shareholder holding Mvela Group Shares as capital assets will be deemed to acquire the unbundled Mvelaserve Ordinary Shares as capital assets. 50. the revised CGT valuation of the Mvela Group Shares. bears to the sum of the market value. where applicable. of the Mvela Group Ordinary Shares and the Mvelaserve Ordinary Shares. B = each of the original expenditure incurred and. 50. in respect of which the Mvelaserve Ordinary Shares in C were received. as contemplated above.

The base cost so allocated to the unbundled Mvelaserve ordinary shares will reduce the base cost of the Mvela Group Shares held. as determined above. The base cost to be allocated to the unbundled Mvelaserve Ordinary Shares will be determined by applying a specified ratio to the base cost of the Mvela Group Shares. where applicable. by way of an announcement to be released on SENS on or about Wednesday.A = the deemed expenditure and. 1 December 2010. Any expenditure allocated to the Mvelaserve Ordinary Shares must be deemed to have been incurred on the date that the expenditure was incurred in respect for the Mvela Group Shares. as above. 64 . being the result of [C/(C + D)]. thus allocating the base cost between the Mvela Group Shares and the unbundled Mvelaserve Ordinary Shares. Mvela Group will advise Mvela Group Ordinary Shareholders of the specified ratio. Mvela Group Ordinary Shareholders will be deemed to have acquired the unbundled Mvelaserve Ordinary Shares on the date on which the Mvela Group Shares were originally acquired. deemed CGT valuation of the Mvelaserve Ordinary Shares.

DISPOSAL OF PROPERTY As at the date of this Pre-listing Statement. 53. hold any Mvelaserve Ordinary Shares. relating to Directors’ and managers’ remuneration. As at the date of this Pre-listing Statement.PART I: ADDITIONAL INFORMATION 51. and there are no options to acquire any such property. syndicate or other association of which the promoter was a member. other than in the ordinary course of business. None of the Directors or the promoters have a material beneficial interest in any of the securities in. PROPERTY AND SUBSIDIARIES ACQUIRED OR TO BE ACQUIRED AND VENDORS Set out in Annexure 9 to this Pre-listing Statement are details of the material acquisitions in the three years preceding the date of this Pre-listing Statement. 52. as set out in the “Corporate Information” section on page 1 of this Pre-listing Statement. INFORMATION ON SUBSIDIARIES Details of Mvelaserve’s Subsidiaries are set out in Annexure 7 to this Pre-listing Statement. and • particulars of existing contracts and proposed contracts. not being a Director during the three years preceding the date of this Pre-listing Statement. None of the Directors have any material interest in any of the immovable properties owned or leased by Mvelaserve Group. INTERESTS OF ADVISERS AND PROMOTERS. Material contracts concluded during the two years preceding the date of this Pre-listing Statement are: • the acquisition of 75% of the issued share capital of Zonke by Mvelaserve from Mvela Group. in the three year period preceding the date of this Pre-listing Statement. whether directly or indirectly. AND AMOUNTS PAID OR PAYABLE TO PROMOTERS None of the advisers. any other company or business enterprise or any immovable properties or other property in the nature of fixed assets acquired by Mvelaserve Group. 57. there are no disposals of any material properties by Mvelaserve Group nor were there any proposed disposals of material properties. 56. 65 . Mvelaserve Group has not paid any amount (whether in cash or in securities). 55. No promoters have any material beneficial interest in the promotion of Mvelaserve. 54. RESTRUCTURING Details of the Restructuring which will take place prior to the Listing of Mvelaserve Ordinary Shares are set out in Annexure 1 to this Prelisting Statement. there are no proposed acquisitions by Mvelaserve Group of any property. either written or orally. nor given any benefit to any promoters or any partnership. secretarial and technical fees payable by Mvelaserve Group (refer to Annexure 6 for details). MATERIAL CONTRACTS Annexure 11 to this Pre-listing Statement sets out material contracts that have been entered into by Mvelaserve or its subsidiaries during the two years preceding the date of this Pre-listing Statement. PRINCIPAL IMMOVABLE PROPERTY OWNED OR LEASED Details of the principal immovable properties owned or leased by Mvelaserve Group are set out in Annexure 8 to this Pre-listing Statement. or the business undertakings of.

office equipment and other facilities. on the basis that this amount represents the amount by which Mr Jones was overpaid during his employment. In about July 2009. LOAN CAPITAL AND MATERIAL LOANS Details of the material borrowings of Mvelaserve as at the Last Practicable Date are set out in Annexure 10 to this Pre-listing Statement. secretarial or technical fees payable by Mvelaserve Group. LEASE PAYMENTS Mvelaserve Group has various operating lease agreements for vehicles. • contracts entered into at any time prior to the two years preceding the date of this Pre-listing Statement other than in the ordinary course of business that contain obligations or settlements material to Mvelaserve or its Subsidiaries as at the date of this Pre-listing Statement. The future minimum lease payments under non-cancellable operating leases as at 30 June 2010 in respect of periods in excess of four years was R40 million. machinery. The inter-company loans of Mvelaserve as at 30 June 2010 are set out in Annexure 10 to this Pre-listing Statement. Mr Jones became entitled to the payment of certain sales commissions on new business brought by him to. disputes arose between Royalserve Catering and Mr Jones about. offices. (ii) damages in an additional sum of approximately R147 million. 59. instituted a counterclaim for repayment by Mr Jones of an amount of approximately R14 million. No loans have been made or security furnished by Mvelaserve to or for the benefit of any Director or manager as at the date of this Pre-listing Statement. Mr Jones’ claim can be broken down into three parts: (i) a claim for commission amounting to approximately R3 million. Mr Jones became entitled to a certain operating incentive for managing the newly established Project Support Services Division of Royalserve Catering. 60. During his employment. with effect from August 2006. Further. Mvelaserve has been advised that Mr Jones is unlikely 66 . 58. inter alia. in turn. Mvelaserve has been advised by the attorneys representing Royalserve Catering in this dispute that although Mr Jones may be successful in his claim with regards to the commissions. the manner in which these commissions had been calculated. and (iii) compensation in the sum of approximately R12 million as a result of his alleged constructive dismissal by Royalserve Catering. Royalserve Catering has. The disputes were then referred to arbitration before senior counsel. LITIGATION STATEMENT There are pending arbitration proceedings between Royalserve Catering and Mr Louis Martin Jones (“Mr Jones”). Further. 61. and his extension of existing business of. Mvelaserve does not have any material loans receivable outstanding as at the date of this Pre-listing Statement. Mvelaserve Group has no debentures in issue as at the date of this Pre-listing Statement. which Mr Jones allegedly suffered as a result of the cancellation of the employment contract between him and Royalserve Catering. Mr Jones was initially employed by Royalserve Catering (then still known as RoyalSechaba Holdings (Proprietary) Limited) as a business development executive. • existing or proposed contracts relating to royalties or. the quantum of such claim will be substantially smaller than the amount he is claiming and that such commissions are more than offset by the amounts by which he had been overpaid during his employment by Royalserve Catering. there are no: • material contracts that have been entered into by Mvelaserve or its Subsidiaries during the two years preceding the date of this Pre-listing Statement. MATERIAL CAPITAL COMMITMENTS There were no material capital commitments as at the Last Practicable Date.Other than as set out above. Royalserve Catering. other than in the ordinary course of business. 62. CONTINGENT LIABILITIES There were no material contingent liabilities as at the Last Practicable Date.

none of the advisers have any equity interest in Mvelaserve. COMMISSIONS PAID OR PAYABLE IN RESPECT OF UNDERWRITING Save for the fees as disclosed in this Pre-listing Statement. reporting accountants and auditors. 63. Other than indicated above. The reporting accountants and auditors have consented to the inclusion of their reports in the form and context in which they appear and have not withdrawn such consent prior to the publication of this Pre-listing Statement. shall be paid by the Group. and transfer secretaries have consented in writing to act in the capacities stated and to their names being included in this Pre-listing Statement and have not withdrawn their consent prior to the publication of this Pre-listing Statement. CONSENTS Each of the investment bank and sponsor. The expenses of the Listing. EXPENSES Mvelaserve Group has not incurred any preliminary expenses (within the meaning of the Listings Requirements) over the last three financial years. The table below sets out the total estimated expenses (excluding VAT) of the Listing to be borne by Mvelaserve: Details Investment banking and sponsor fees Legal adviser fees Reporting accountant and auditors’ fees JSE listing and inspection fees Printing and communication costs Transfer secretaries Total expenses and fees Note: 1. a material effect on the Group’s financial position nor is the Group aware of any such proceedings that are pending or threatened. The investment banking fees and sponsor fees are in terms of a single mandate. DOCUMENTS AVAILABLE FOR INSPECTION Copies of the following documents will be available for inspection at Mvelaserve’s registered office and the sponsor’s offices set out in the “Corporate Information” section during normal business hours (Saturdays. 65. discounts. brokerage or other special terms were granted during the three years preceding the date of this Pre-listing Statement in connection with the issue of any securities. The Mvelaserve Board has considered and accepted the attorneys’ advice with regards to Mr Jones’ prospects of success in the pending arbitration proceedings. 1 Payable to Investec Cliffe Dekker Hofmeyr PKF JSE Various Computershare R’000 3 000 2 000 200 270 400 25 5 955 64. estimated to be in the sum of approximately R6 million. The Mvelaserve Board is of the opinion that any successful claim for commissions will be offset by the amounts with which Mr Jones have been overpaid by Royalserve Catering and that his prospects of succeeding with the damages and constructive dismissal claims are remote. legal advisers. stock or debentures in the capital of the Group. no other legal or arbitration proceedings have been instituted that may have or have had in the last 12 months. No commissions. 66. 67 . or such later date as may be announced: • a signed copy of this Pre-listing Statement (available in English only).to succeed in his damages and constructive dismissal claims. Sundays and official South African public holidays excepted) from the date of issue of this Pre-listing Statement until 3 December 2010. • a signed copy of the Mvela Group circular. • the Memorandum of Association and Articles of Association of Mvelaserve and the memoranda and articles of association of the Subsidiaries of Mvelaserve.

respectively. whose names are provided on page 1 of this Pre-listing Statement. accept full responsibility for the accuracy of the information given and certify that to the best of their knowledge and belief there are no facts that have been omitted which would make any statement false or misleading. legal advisers. • the consolidated audited annual financial statements of Mvelaserve and its Subsidiaries for the three financial years ended 30 June 2010. reporting accountants and auditors. 67. and • the service agreements with Directors and senior managers entered into during the last three years. and transfer secretaries named in this Pre-listing Statement to act in those capacities. • copies of the material contracts referred to in “Additional Information: Material Contracts” section to this Pre-listing Statement. referred to in Annexure 6 to this Pre-listing Statement. J M S Ferreira Chief Executive Officer 27 October 2010 68 . and that all reasonable enquiries to ascertain such facts have been made and that this Pre-listing Statement contains all the information required by law and the Listings Requirements. DIRECTORS’ RESPONSIBILITY STATEMENT The Directors.• the reporting accounts and auditors’ reports dated 27 October 2010. • written consents of the investment bank and sponsor. collectively and individually. to this Pre-listing Statement. which are included as Annexures 3 and Annexure 5. SIGNED AT JOHANNESBURG ON 27 OCTOBER 2010 BY OR ON BEHALF OF THE DIRECTORS OF MVELASERVE LIMITED.

as at 30 June 2010 is illustrated below: 100% Mvelaphanda Management Services* 100% 100% 100% 100% 100% 100% 40% 75% Stamford Sales Note: 1. • The inter-company loans have been settled through cash flows. Step 1: Disposal of Stamford Sales to Mvela Group (not to be included in Mvelaserve Group) • Mvelaserve’s and Mvelaphanda Management Services’ jointly-held 40% interest in Stamford Sales was sold to Mvela Group at a value of R26 982 820 on loan account. cessions of loans and net-off journals. GROUP STRUCTURE BEFORE THE RESTRUCTURING The Mvelaserve Group structure. Mvela Group’s holding in 75% of Zonke is indirectly held through Mvelaphanda Strategic Investments (Proprietary) Limited (“MSI”).ANNEXURE 1 THE RESTRUCTURING 1. 69 . Step 2: Zonke acquisition • Mvelaserve acquired Mvela Group’s indirect 75% interest in Zonke. Mvelaserve issued 6 850 937 new Mvelaserve Ordinary Shares at R11. there were a number of inter-company loans between Mvelaserve Group. and also to establish Mvelaserve’s independence from Mvela Group. OVERVIEW OF THE RESTRUCTURING Mvelaserve has restructured its operations and holdings prior to the Listing in order to bring Zonke under its direct ownership by acquiring Mvela Group’s indirect 75% shareholding in Zonke. in terms of corporate restructuring. and Mvela Group and its Subsidiaries. Step 3: Settlement of inter-company loans between Mvelaserve Group and Mvela Group • As at 30 June 2010. The Restructuring has been completed as at the Listing Date. a wholly-owned subsidiary of Mvela Group. set-offs.82 per share to Mvela Group as consideration for the acquisition. 2. at a value of R81 000 000. with R653 287 804 due from Mvelaserve Group to Mvela Group being settled through the issue of 55 254 736 new Mvelaserve Ordinary Shares (after the Mvelaserve share split of 794 559 new Mvelaserve Ordinary Shares for every 1 Mvelaserve Ordinary Share) at a premium of R653 280 849 to Mvela Group and the utilisation by Mvelaserve of the subscription price in respect of the aforesaid shares to settle the loan.

• In terms of the Unbundling. The entitlement ratio will be confirmed or revised. which is expected to be released on SENS on or about Friday. is illustrated below: Current Mvela Group Ordinary Shareholders 100% Mvelaphanda Management Services* 100% 100% 100% 100% 100% 100% 75% 70 . 19 November 2010. The resultant Mvelaserve Group structure post the Restructuring and Listing. Mvela Group will distribute all the Mvelaserve Ordinary Shares it holds to its shareholders (the Unbundling) in a ratio of 25 Mvelaserve Ordinary Shares for every 100 Mvela Group Shares held. as the case may be. in the finalisation announcement.Step 4: Mvela Group unbundle Mvelaserve Ordinary Shares to its shareholders (“Unbundling”) • Following the Restructuring of Mvelaserve. Mvela Group holds 100% of the share capital of Mvelaserve.

Inter-segment revenue represents 0. plant and equipment Goodwill Other intangible assets Other investments Investments in associates Deferred taxation Current investments Other current assets Other current assets – Mvela Group Treasury debtors Cash and cash equivalents Assets in disposal group held for sale Total assets Liabilities Non-current interest bearing liabilities Non-current non-interest bearing liabilities Financial liabilities Deferred taxation Current interest bearing liabilities Treasury creditors Other current liabilities Total liabilities Net assets 22 085 271 375 5 539 – 8 269 1 509 – 183 169 416 419 140 844 – 1 049 209 – – – – – – 311 770 311 770 737 439 Security Services R’000 247 340 20 189 50 000 8 340 – 5 366 4 593 311 344 – 128 558 5 045 780 775 99 898 – – 1 204 64 497 96 233 269 113 530 944 249 831 Cleaning & Catering R’000 59 796 108 364 1 252 1 407 – 9 715 – 201 318 – 15 447 – 397 299 8 111 – – – 6 696 32 980 169 282 217 068 180 321 Diversified Services R’000 58 399 12 776 75 840 6 615 – 930 1 860 118 753 97 878 43 358 89 960 – 506 368 497 461 722 117 36 900 1 466 107 308 – 75 315 1 440 569 (934 201) Total R’000 387 619 412 704 132 631 16 362 8 269 17 520 6 453 814 584 97 078 459 777 374 809 5 045 2 733 651 605 470 722 117 36 900 2 670 178 501 129 212 825 480 2 500 351 233 300 GROUP 2010: INCOME STATEMENT INFORMATION Facilities Management R’000 Revenue¹ Profit from operations Net interest expensed Fair value adjustments and net Loss from investments Share of profit from associates Net profit/(loss) before taxation Taxation expense Net profit/(loss) for the year 1 105 578 166 740 23 777 – 6 075 196 593 (46 758) 149 834 Security Services R’000 1 577 567 110 534 (16 395) – – 94 139 (25 245) 68 893 Cleaning & Catering R’000 1 087 882 14 896 (4 176) (1 812) – 8 908 (1 784) 7 124 Diversified Services R’000 290 971 272 (63 700) (914) – (64 342) (6 495) (70 837) Total R’000 4 061 998 292 442 (60 494) (2 726) 6 075 235 297 (80 282) 155 015 ¹ Revenue is revenue received from external customers.ANNEXURE 2 THE AUDITED AND REVIEWED CONSOLIDATED FINANCIAL INFORMATION OF MVELASERVE AND ITS SUBSIDIARIES FOR THE YEAR ENDED 30 JUNE 2010 AND THE YEARS ENDED 30 JUNE 2009 AND 30 JUNE 2008.003% of total revenue 71 . RESPECTIVELY OPERATING SEGMENTAL REPORT GROUP 2010: BALANCE SHEET INFORMATION Facilities Management R’000 Assets Property.

plant and equipment Goodwill Other intangible assets Other investments Investments in associates Deferred taxation Current investments Other current assets Other current assets – Mvela Group Treasury debtors Cash and cash equivalents Total assets Liabilities Non-current interest bearing liabilities Non-current non-interest bearing liabilities Financial liability Deferred taxation Current interest bearing liabilities Treasury creditors Other current liabilities Total liabilities Net assets – – – 3 684 – – 292 557 296 241 607 127 56 740 – – 2 419 51 025 143 611 207 211 461 006 180 511 10 644 – – 1 320 6 332 16 386 169 490 204 172 182 020 501 768 566 362 34 199 2 191 99 854 – 101 575 1 305 949 (890 760) 569 152 566 362 34 199 9 614 157 211 159 997 770 833 2 267 368 78 898 20 248 271 375 3 660 – 6 301 5 948 – 181 159 296 874 117 803 903 369 164 811 21 649 50 000 18 633 – 13 195 – 324 368 – 48 861 641 516 68 000 108 364 336 6 680 – 11 110 – 141 553 23 341 26 808 386 190 59 543 12 776 75 840 7 240 – 2 731 2 310 107 242 97 878 32 850 16 779 415 189 312 602 414 164 129 836 32 553 6 301 32 984 2 310 754 322 97 878 353 065 210 251 2 346 266 Security Services R’000 Cleaning & Catering R’000 Diversified Services R’000 Total R’000 72 .GROUP 2010: CASH FLOW STATEMENT INFORMATION Facilities Management R’000 Cash flow from operating activities Cash flow from investing activities Cash flow from financing activities Net movement in cash and cash equivalents 158 855 (15 256) (120 558) 23 041 Security Services R’000 211 407 (143 193) 11 483 79 697 Cleaning & Catering R’000 (30 950) (14 339) 33 928 (11 361) Diversified Services R’000 (74 128) (3 091) 150 400 73 181 Total R’000 265 184 (175 879) 75 253 164 558 GROUP 2009: BALANCE SHEET INFORMATION Facilities Management R’000 Assets Property.

Inter-segment revenue represents 0. GROUP 2009: CASH FLOW STATEMENT INFORMATION Facilities Management R’000 Cash flow from operating activities Cash flow from investing activities Cash flow from financing activities Net movement in cash and cash equivalents 128 759 (19 163) (104 058) 5 538 Security Services R’000 11 013 (54 010) 75 215 32 218 Cleaning & Catering R’000 7 923 (40 285) 20 758 (11 604) Diversified Services R’000 (51 242) 16 023 168 (35 051) Total R’000 96 454 (97 436) (7 917) (8 899) 73 .GROUP 2009: INCOME STATEMENT INFORMATION Facilities Management R’000 Revenue¹ Profit from operations Net interest income/(expense) Dividend income Fair value adjustments and net Loss from investments Share of profit/(loss) from associates Net profit/(loss) before taxation Taxation expense Net profit/(loss) for the year 1 108 013 165 079 24 217 – – 4 426 193 721 (44 142) 149 579 Security Services R’000 1 263 044 54 388 (19 515) – (528) – 34 345 (8 122) 26 223 Cleaning & Catering R’000 756 058 24 796 (4 363) – (367) – 20 066 (6 278) 13 788 Diversified Services R’000 474 142 (52 138) (92 722) 99 (39 768) (962) (185 491) (14 211) (199 702) Total R’000 3 601 257 192 125 (92 383) 99 (40 663) 3 463 62 641 (72 753) (10 112) ¹ Revenue is revenue received from external customers.003% of total revenue.

GROUP 2008: BALANCE SHEET INFORMATION Facilities Management R’000 Assets Property.003% of total revenue. 74 . Inter-segment revenue represents 0. plant and equipment Goodwill Other intangible assets Other investments Investments in associates Deferred taxation Current investments Other current assets Other current assets – Mvela Group Treasury debtors Cash and cash equivalents Assets in disposal group held for sale Total assets Liabilities Non-current interest bearing liabilities Non-current non-interest bearing liabilities Deferred taxation Current interest bearing liabilities Treasury creditors Other current liabilities Liability in disposal group held for sale Total liabilities Net assets – – – – – 309 347 309 347 476 729 53 154 – 4 642 34 905 123 749 163 545 379 995 150 753 11 339 – – 4 129 13 944 127 989 157 401 170 216 62 491 848 870 1 353 133 865 66 491 130 542 176 895 1 420 507 (707 644) 126 984 848 870 5 995 172 899 204 184 722 322 176 895 2 267 250 90 054 18 384 271 375 8 345 – 3 137 5 157 – 174 942 192 471 112 265 – 786 076 133 176 21 644 50 000 31 174 8 316 16 119 16 328 200 703 – 53 288 – 530 748 53 552 101 031 – 2 129 – 7 156 – 106 137 19 201 38 411 – 327 617 61 146 12 7767 69 445 10 194 785 29 – 139 010 105 950 18 046 15 186 280 295 712 863 266 258 406 827 127 790 43 497 12 238 28 461 16 328 620 792 105 950 229 718 219 150 280 295 2 357 304 Security Services R’000 Cleaning & Catering R’000 Diversified Services R’000 Total R’000 GROUP 2008: INCOME STATEMENT INFORMATION Facilities Management R’000 Revenue¹ Profit from operations Net interest expensed Fair value adjustments and net Loss from investments Share of profit/(loss) from associates Net profit/(loss) before taxation Taxation expense Net profit/(loss) for the year 1 044 182 48 167 20 904 – 975 70 046 (48 632) 21 414 Security Services R’000 1 092 189 19 687 (14 397) (12 631) 514 (6 827) (466) (7 294) Cleaning & Catering R’000 655 553 19 005 (1 488) – – 17 517 (6 337) 11 180 Diversified Services R’000 671 350 22 455 (20 291) (3 032) (865) (1 733) (12 129) (13 862) Total R’000 3 463 275 109 314 (15 272) (15 663) 624 79 003 (67 564) 11 439 ¹ Revenue is revenue received from external customers.

GROUP 2008: CASH FLOW STATEMENT INFORMATION Facilities Management R’000 Cash flow from operating activities Cash flow from investing activities Cash flow from financing activities Net movement in cash and cash equivalents 55 215 (3 664) (59 297) (7 746) Security Services R’000 (32 501) (56 045) 111 717 23 171 Cleaning & Catering R’000 44 386 (35 442) (7 716) 1 228 Diversified Services R’000 61 956 (198 746) 116 535 (20 255) Total R’000 129 057 (293 896) 161 238 (3 603)

75

GROUP FINANCIAL STATEMENTS CONSOLIDATED STATEMENT OF FINANCIAL POSITION Notes at 30 June ASSETS Non-current assets Property, plant and equipment Goodwill Intangible assets Investments in associates Other investments Financial asset Deferred taxation Current assets Other investments Inventories Trade and other receivables Trade and other receivables – Mvela Group Cash and cash equivalents Treasury receivable Assets in disposal group held for sale Total assets EQUITY AND LIABILITIES Capital and reserves Share capital Distributable reserve Total attributable to ordinary equity holders Minority interests Non-current liabilities Interest bearing liabilities – preference share funding Asset finance Non-interest bearing liabilities – Mvela Group Financial liability Deferred taxation Current liabilities Trade and other payables Interest bearing liabilities – Mvela Group Asset finance Non-interest bearing liabilities Taxation liabilities Treasury creditors Liabilities in disposal group held for sale Total equity and liabilities Net number of ordinary shares in issue Net asset value per ordinary share (R’000) Net tangible assets per ordinary share (R’000) 21 18 18 19 18 18 19 12 20 233 300 – 227 817 78 898 – 76 019 90 054 – 88 492 11 13 14 15 16 7 8 9 10 11 12 20 975 105 387 619 412 704 132 631 8 269 16 362 – 17 520 1 753 501 15 553 41 608 763 876 97 878 374 809 459 777 5 045 2 733 651 928 440 312 602 414 164 129 836 6 301 32 553 – 32 984 1 417 826 11 254 39 911 705 467 97 878 210 251 353 065 – 2 346 266 885 071 266 258 406 827 127 790 12 238 40 255 3 242 28 461 1 191 938 20 117 37 536 579 467 105 950 219 150 229 718 280 295 2 357 304 2010 R’000 Group 2009 R’000 2008 R’000

]]]]]]]]]]

]]]]]]]]]]

]]]]]]]]]]

227 817 5 483 1 367 158 482 438 123 032 722 117 36 900 2 671 1 133 193 793 736 100 478 78 022 18 136 13 609 129 212 – 2 733 651 100 2 278 (3 350)

76 019 2 879 1 179 327 482 438 86 714 566 362 34 199 9 614 1 088 041 748 002 93 560 63 651 22 324 507 159 997 – 2 346 266 100 760 (5 010)

88 492 1 562 981 849 – 126 984 848 870 – 5 995 1 108 506 722 066 74 397 98 502 1 401 7 956 204 184 176 895 2 357 304 100 885 (4 746)

16

76

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME Notes for the year ended 30 June Continued operations Revenue Cost of sales Gross profit Other operating profit Operating expenses Profit from operations Interest received 3rd party Interest paid 3rd party Interest treasury Dividend income Fair value adjustments and net profit/(loss) from investments Share of profit from associates Net profit before taxation Taxation expense Profit/(Loss) for the year from continuing operations Discontinued operations Profit for the year from discontinued operations Total comprehensive income/(loss) for the year Total comprehensive income attributable to: Owners of the parent Minority shareholders Weighted average number of ordinary shares in issue Earnings per ordinary share (R’000) Headline earnings per ordinary share (R’000) 16 23 24 22 4 061 998 (3 103 298) 958 700 32 671 (700 084) 291 287 14 888 (77 943) 2 561 – (2 726) 6 075 234 142 (80 282) 153 860 1 155 155 015 151 798 3 217 100 1 518 1 514 3 601 257 (2 703 969) 897 288 49 344 (756 040) 190 592 25 433 (110 492) (7 324) 99 (40 663) 3 463 61 108 (72 753) (11 645) 1 533 (10 112) (12 473) 2 361 100 (125) (143) 3 463 275 (2 616 880) 846 395 57 584 (794 665) 109 314 16 536 (30 341) (1 467) – (15 663) 624 79 003 (67 564) 11 439 – 11 439 12 566 (1 127) 100 114 98 2010 R’000 Group 2009 R’000 2008 R’000

25 26 27

STATEMENT OF CHANGES IN EQUITY Share Distributable capital reserves R’000¹ R’000 GROUP Balance at 30 June 2007 Acquisitions of subsidiaries Net (profit)/loss for the period Distributions/Dividends paid Balance at 30 June 2008 Disposals of subsidiaries Net profit/(loss) for the period Dividends paid Balance at 30 June 2009 Net profit for the period Dividends paid Balance at 30 June 2010
1. Value less than R1 000.

Total attributable to equity holders R’000 75 926 – 12 566 – 88 492 – (12 473) – 76 019 151 798 – 227 817

Minority interests R’000 3 549 456 (1 127) (1 316) 1 562 (427) 2 361 (617) 2 879 3 217 (613) 5 483

Capital and reserves R’000 79 475 456 11 439 (1 316) 90 054 (427) (10 112) (617) 78 898 155 015 (613) 233 300

– – – – – – – – – – – –

75 926 – 12 566 – 88 492 – (12 473) – 76 019 151 798 – 227 817

77

as amended. controlled by the Group. except where otherwise disclosed. which are. the JSE Listings Requirements and the South African Companies Act of 1973. plant and equipment and other intangible assets Proceeds from disposal of property. directly or indirectly. Control exists when the Group. Subsidiaries are all entities. 2. plant and equipment Proceeds from disposal of investments Decrease in investments Cash flows from financing activities Increase in non-current liabilities Increase/(Decrease) in current liabilities Decrease in minority interest Increase in treasury debtor (Decrease)/Increase in treasury creditor Net increase/(decrease) in cash and cash equivalents Cash and cash equivalents at the beginning of the year Cash and cash equivalents at the end of the year 15 33 28 29 30 2010 R’000 265 184 4 067 249 (3 687 020) Group 2009 R’000 96 454 3 538 809 (3 269 977) 268 832 (92 383) 1 363 (81 359) (97 436) 87 357 (217 865) 7 549 2 000 23 523 (8 984) 225 190 (66 023) (617) (123 347) (44 187) (9 966) 220 217 210 251 2008 R’000 129 057 3 270 759 (3 070 009) 200 750 (16 614) 50 (55 129) (293 896) (15 693) (308 603) 21 439 772 8 189 161 238 67 729 8 089 (1 316) – 86 736 (3 601) 223 818 220 217 ]]]]]]]]]] ]]]]]]]]]] ]]]]]]]]]] 32 380 229 (60 494) 4 108 (58 659) (175 879) – (196 005) 6 415 1 787 11 924 75 253 192 073 21 289 (613) (106 712) (30 784) 164 558 210 251 374 809 1. AC 500 series of interpretations as issued by the Accounting Practices Board or its successor. 4.1. has an interest of more than one-half of 78 . The financial statements incorporate the following principal accounting policies.1 Investments in subsidiaries The Group financial statements incorporate the assets.1 Basis of consolidation 4. 3. PRINCIPAL ACCOUNTING POLICIES 4.STATEMENT OF CASH FLOWS Notes for the year ended 30 June Cash flows from operating activities Cash received from customers Cash paid to suppliers and employees Cash generated from operations Net interest paid Investment income Taxation paid Cash flows from investing activities Disposals/(Acquisitions) of subsidiaries Additions to property. liabilities and results of the operations of the Group and its subsidiaries. GENERAL INFORMATION Mvelaserve Limited is incorporated in the Republic of South Africa. STATEMENT OF COMPLIANCE The financial statements have been prepared in accordance with International Financial Reporting Standards (“IFRS”). modified by the restatement of financial instruments to fair value where applicable. BASIS OF PREPARATION The financial statements are prepared on the historical cost convention. consistent with those applied in the previous year. including special purpose entities.

Equity accounting involves recognising.3 Investments in jointly controlled entities Jointly controlled entities are those entities over which the Group exercises joint control in terms of a contractual agreement. in which case it is accounted for as designated as at fair value through profit and loss in accordance with IAS 39 of the International Financial Reporting Standards. Losses of associates in excess of the Group’s interest are not recognised unless there is a binding obligation to contribute to the losses. 4. 4. the Group’s share of the associates’ earnings for the year.13. Investments in associates are accounted for using the equity method of accounting. with similar items in the financial statements of the 79 . the liabilities incurred and the equity interests issued by the Group. but not control. The most recent financial information of associates is used. the Group recognises any minority shareholders in the acquiree either at fair value or at the minority shareholders’ proportionate share of the acquiree’s net assets. and is neither a subsidiary nor a jointly controlled entity of the Group. Investments in jointly controlled entities are accounted for by way of the proportionate consolidation method whereby the Group’s proportional share of the assets. Identifiable assets acquired and liabilities and contingent liabilities assumed in a business combination are measured initially at their fair values at the acquisition date. the difference is recorded as goodwill and is included as part of the carrying value of the investment in associates.1. The acquisition method of accounting is used to account for business combinations by the Group. On an acquisition-by-acquisition basis.2.the voting rights or otherwise has the power to govern the financial and operating policies of an entity so as to obtain benefits from its activities. The consideration transferred includes the fair value of any asset or liability resulting from a contingent consideration arrangement. Acquisitionrelated costs are expensed as incurred. If this is less than the fair value of the net assets of the subsidiary acquired in the case of a bargain purchase. The Group applies a policy of treating transactions with minority shareholders as transactions with equity owners of the Group. revenue and expenses of jointly controlled entities are combined on a line-by-line basis.2. net of accumulated impairment loss. Accounting policies of subsidiaries have been changed where necessary to ensure consistency with the policies adopted by the Group. The results of subsidiaries acquired and disposed of during a financial year are included from the date on which control is transferred to the Group and deconsolidated from the date that control ceases. except for investments that are managed and whose performances are evaluated on a fair value basis in accordance with the Group’s investment strategy. the difference between any consideration paid and the relevant share acquired of the carrying value of net assets of a subsidiary is recorded in equity.2 Investments in associates An associate is an entity over whose financial and operating policies the Group has the ability to exercise significant influence. in the Statement of Comprehensive Income. Disposals to minority shareholders result in gains and losses for the Group which is recorded in equity. the difference is recognised directly in the Statement of Comprehensive Income. Where the fair value of the consideration paid exceeds the fair value of the identifiable assets acquired and liabilities and contingent liabilities assumed. Adjustments are made to the associate’s financial results for material transactions and events in the intervening period. liabilities. The excess of the consideration transferred and the amount of any minority shareholders in the acquiree and the acquisition date fair value of any previous equity interest in the acquiree over the fair value of the Group’s share of the identifiable net assets acquired is recorded as goodwill in accordance with accounting policy note 4. For purchases from minority shareholders.1. as per accounting policy note 4. The results of associate companies acquired and disposed of during the year are included from the effective dates of acquisition to the effective dates of disposal. The total carrying amount of associates is evaluated annually for impairment. The Group’s interest in associates is carried in the Statement of Financial Position at an amount that reflects its share of the net assets of the associate and goodwill identified on acquisition of the associate. The consideration transferred for the acquisition of a subsidiary is the fair values of the assets transferred.

exceeds its recoverable amount.4 Transactions eliminated on consolidation Intra-Group balances and transactions. as previously recorded under SA GAAP. is amortised on the straight-line basis over the expected useful lives of the assets.3. being between three and five years. 4. goodwill is allocated to the cash-generating unit(s) expected to benefit from the business combination in which the goodwill arose.1 Trademarks Internally generated trademarks are classified as indefinite useful life intangible assets as they are inherent to the continuous operation of the businesses to which they relate. Computer software is tested annually for impairment or changes in estimated future benefits. Goodwill arising from a business combination for which the agreement date is prior to 31 March 2004. is not amortised but is carried at cost less accumulated impairment losses. Unrealised gains resulting from the transactions with associates and jointly controlled entities are eliminated to the extent of the Group’s interest in the entity. including the associated goodwill. and are stated at cost less accumulated impairment losses. Any goodwill arising on the acquisition of the Group’s interest in a jointly controlled entity is accounted for in terms of accounting policy note 4. other than goodwill (refer to policy note 4.2) are recognised if it is probable that future economic benefits will flow to the entity from the intangible assets and the costs of the intangible assets can be reliably measured.1. Manufacturing and distribution rights are tested at least annually for impairment.Group. for which the agreement date is on or after 31 March 2004. On disposal of a subsidiary or a jointly controlled entity. except that they are only eliminated to the extent that there is no evidence of impairment. 80 . 4. The results of jointly controlled entities are included from the effective dates when joint control commences to the effective dates when joint control ceases. All business combinations are accounted for by applying the acquisition method. are recognised as intangible assets. No perceived end to the economic benefits to be derived from the assets.3. and are stated at cost less accumulated impairment losses.3 Intangible assets Intangible assets. An impairment loss is recognised if the carrying amount of the cash-generating unit. being its cost less accumulated up to 31 March 2004. Capitalised computer software is carried at cost less accumulated and impairment losses.2. 4. 4.2 Computer software Direct software development costs that enhance the benefits of computer software programs and are clearly associated with an identifiable and unique software system.3. Goodwill arising from a business combination. is included in the Statement of Financial Position at its deemed cost. 4.2 Goodwill Goodwill represents amounts arising on acquisition of subsidiaries and joint ventures. the attributable amount of goodwill is included in the determination of the profit or loss on disposal. Unrealised gains resulting from transactions with associates are eliminated against the investment in associates. which will be controlled by the Group and has a probable benefit exceeding one year. No perceived end to the economic benefits to be derived from the assets. and unrealised gains arising from intra-group transactions. including software development costs recognised as intangible assets. 4. Unrealised losses on transactions with associates are eliminated in the same way as unrealised gains.Trademarks are tested for impairment at least annually. are eliminated in preparing the consolidated financial statements. For the purpose of impairment testing.3 Manufacturing and distribution rights Acquired manufacturing and distribution rights are classified as indefinite useful life intangible assets as they are inherent to the continuous operation of the business to which they relate. Goodwill is tested at least annually for impairment. Computer software.

Property. The estimated useful lives and residual values are reviewed at each financial year end. Non-monetary assets and liabilities that are measured in terms of historical cost in a foreign currency are translated using the exchange rate at the date of the transaction. Non-monetary assets and liabilities denominated in foreign currencies that are stated at fair value are translated to South African rand at foreign exchange rates ruling at the dates that the fair value was determined. first-out basis. the probability that the debtor will enter bankruptcy or financial reorganisation. improvements to leasehold premises. office equipment and motor vehicles are stated at cost less accumulated depreciation and impairment calculated on the component method. Subsequent recoveries of amounts previously written off are credited to the Statement of Comprehensive Income. 4. it is written off against the allowance account for trade receivables. which rates are considered appropriate to write off the cost of the asset to the estimated residual value over the estimated useful life of the asset thereof.4 Property.4. plant and equipment Furniture. Cost is determined on a first-in. at rates considered appropriate to write off the cost thereof to the estimated residual value over the estimated useful life of the buildings. at the rates set out below. less provision for impairment. A provision for impairment of trade receivables is established when there is objective evidence that the Group will not be able to collect all amounts due according to the original terms of the receivables. computer equipment. plant and equipment. The gain or loss arising on the disposal or retirement of an item of property. 4. Translation differences are recognised in the Statement of Comprehensive Income. The carrying amount of the asset is reduced through the use of an allowance account. and on a straight-line basis. The amount of the provision is the difference between the asset’s carrying amount and the present value of estimated future cash flows. The cost of finished goods includes direct expenditure and production overheads. Inventory comprises of finished goods. plant and equipment are tested annually for impairment. Net realisable value is the estimated selling price in the ordinary course of business. 81 . plant and equipment is determined as the difference between sales proceeds and the carrying amount of the asset and is recognised in the Statement of Comprehensive Income. Any write downs to inventory and reversals to prior years write down are accounted for in cost of sales. Land is carried at cost. 4.5 Inventories Inventories are valued at the lower of cost and net realisable value. Reversals to prior year inventory write downs are limited to the cost of the inventory written down. work in progress and raw materials. Exchange differences are taken to profit and loss in the year in which they arise.7 Foreign currency transactions Foreign currency transactions are recorded at the exchange rate ruling on the transaction dates.6 Trade and other receivables Trade and other receivables are recognised initially at fair value and are subsequently measured at amortised cost using the effective interest method. fittings. The current rates used are: Plant and equipment Office equipment Computer equipment Furniture and fittings Motor vehicles – passenger Motor vehicles – commercial Improvements to leasehold premises 15% – 20% 15% 33% 15% 20% 25% period of lease Land and buildings owned and occupied by Group companies are classified as own use property. Buildings are carried at cost less depreciation calculated on a straight-line basis. discounted at the original effective interest rate. When a trade receivable is uncollectable. and the amount of the loss is recognised in the Statement of Comprehensive Income. and default or delinquency in payments. less applicable variable selling expenses. Indicators that trade receivables may be impaired are significant financial difficulty experienced by the debtor. Monetary assets and liabilities in foreign currencies are translated at the rates of exchange ruling at the end of each reporting period.

Current substantially enacted taxation rates are used to determine deferred income taxation.11.8 Taxation The taxation expense represents the sum of the current taxation payable (local and international). fair value adjustments on strategic investments and taxation losses carried forward. are classified as finance leases. other current highly liquid investments with original maturities of three months or less.4. for goods supplied and services rendered. deferred taxation and secondary taxation on companies. 4.12 Leased assets Lease contracts.9 Cash and cash equivalents Cash and cash equivalents comprise cash on hand.1 Revenue recognition Revenue from service-based activities is recognised when the service is completed. after trade discounts. Bank overdrafts are included as part of current liabilities on the Statement of Financial Position. Deferred taxation is accounted for using the comprehensive liability method in respect of temporary differences which arise from differences between the carrying amount of assets and liabilities in the financial statements and the corresponding taxation basis used in the computation of taxable income. Taxable income differs from net income as reported in the Statement of Comprehensive Income where it includes items of income and expense that are taxable or deductible in other periods and it further excludes items that are not taxable or deductible. 4. plant and equipment. 4. deposits held on call with banks. Assets held under finance leases are capitalised at the inception of the lease at the lower of the fair value of the leased asset or the present value of the minimum lease payments. where the Group has substantially all the risks and rewards of ownership of the leased assets. Deferred taxation liabilities are recognised for all taxable temporary differences and deferred taxation assets are recognised to the extent that it is probable that taxable income will be available against which deductible temporary differences can be utilised. comprises the net amounts invoiced to customers. The carrying value of deferred taxation assets is reviewed at the end of each reporting period and reduced to the extent that it is no longer probable that sufficient taxable income will be available to allow part of the asset to be recovered. 4. on the same basis as owned assets. Debtor and creditor balances relating to these transactions are recorded in the Statement of Financial Position. The current taxation currently payable is based on the taxable income for the year. which excludes value-added tax. Cash and cash equivalents are carried on the Statement of Financial Position at fair value. Interest earned is accrued on a time proportion basis using the effective interest rate method. 4. and bank overdrafts. The principal temporary differences arise from depreciation on property. various provisions. Under certain service contracts the Group manages customer expenditure and is obliged to purchase goods and services from third-party contractors and recharge them to the customer at cost. Revenue from the sale of merchandise and finished goods is brought to account when the risk in the goods passes to the customer.10 Trade and other payables Trade and other payables are recognised initially at fair value and subsequently measured at amortised cost using the effective interest method. These “flow through” amounts charged by contractors and recharged to customers at cost are excluded from turnover and cost of sales. 82 .11 Revenue Revenue. and are depreciated over the shorter of the useful life of the asset. The Group’s liability for current taxation uses the current substantially enacted taxation rates. Secondary taxation on companies is recognised as part of the taxation charge in the Statement of Comprehensive Income when the related dividend is declared. Dividends are recognised when the right to receive payment is established. or the lease term.

Where the effect of the time value of money is not considered to be material. trade and other receivables. are classified as finance lease liabilities. interest bearing liabilities and derivative financial instruments. strategic investments. Payments made under operating leases are charged to the Statement of Comprehensive Income on a straight-line basis over the period of the lease. Financial instruments carried on the Statement of Financial Position include cash and cash equivalents (as defined). If the Group neither transfers nor retains substantially all the risks and rewards of ownership and continues to control the transferred asset. The particular recognition methods adopted are disclosed in the individual policy statements or notes associated with each item. are classified as operating leases. If the Group retains substantially all the risks and rewards of ownership of a transferred financial asset. respectively. net of finance charges. Loans and receivables are initially recognised at fair value. Leases of assets. and mainly include strategic investments.1 Financial assets The Group classifies its financial assets in the following categories. The Group derecognises a financial asset only when the contractual right to the cash flows from the asset expires. except for maturities greater than 12 months after the end of each reporting period.13. 83 . These are classified as non-current assets. the Group recognises its retained interest in the asset and an associated liability for amounts it may have to pay. 4. Financial assets at fair value through profit and loss are financial assets held for trading or those designated as fair value through profit and loss on initial recognition.13 Investments 4. associates and jointly controlled entities Investments in subsidiaries. the Group continues to recognise the financial asset and also recognises a collateralised borrowing for the proceeds received. Financial assets carried at fair value through profit and loss are initially recognised at fair value and subsequently carried at fair value. Loans and receivables are non-derivative financial assets with fixed or determinable payments that are not quoted in an active market. The method for estimation of fair value is described within the disclosure on judgements and estimates.2 Financial liabilities The Group classifies its financial liabilities as either financial liabilities at fair value through profit or loss or other financial liabilities. The classification depends on the nature and purpose of the financial instrument and is determined at the time of initial recognition. Each lease payment is allocated between capital and finance charges. Finance charges are expensed using the effective interest method. Gains and losses arising from changes in the fair value of the financial assets at fair value through profit and loss category are presented in the Statement of Comprehensive Income in the period in which they arise. current liabilities. and subsequently carried at amortised cost using the effective interest method.1 Investments in subsidiaries. Loans and receivables include trade and other receivables and cash and cash equivalents in the Statement of Financial Position. These assets are reflected in current and noncurrent assets. Derivatives are classified as held for trading unless they are designated as hedges. plus transaction costs. where a significant portion of the risks and rewards of ownership are retained by the lessor.14. associates and jointly controlled entities are recognised at cost less accumulated impairment losses in the Company’s separate financial statements. They are included in current assets. trade and other payables. 4. financial liabilities and equity instruments including derivative instruments. at fair value through profit or loss or loans and receivables. 4. Where the effect of the time value of money is not considered to be material. financial assets carried at amortised cost using the effective interest rate method are not discounted as their carrying values approximate fair value. or it transfers the financial asset and substantially all the risks and rewards of ownership of the asset to another entity. financial liabilities carried amortised cost using the effective interest rate method are not discounted as their carrying values approximate fair value.14. 4.The corresponding rental obligations.14 Financial instruments Financial instruments include all financial assets.

18 Employee benefits The Group provides for retirement benefits for the majority of employees by payments to independently administered defined-contribution pension and provident funds. its recoverable amount is estimated. 4. Issued share capital is stated at the amount of the proceeds received less directly attributable issue costs. cancelled or they expire. 4. 4. loans and liabilities (interest bearing and non-interest bearing) and other payables that are not held for trading purposes and have fixed or determinable payments that are not quoted in an active market. 4. Provisions are reviewed at the end of each reporting period and adjusted to reflect current best estimate. and only when. A previously recognised impairment loss. 4. are classified as equity. and intangible assets not yet available for use.20.15 Impairment of assets Except for goodwill. Impairments to CGU’s are first applied to goodwill and then to other assets in the CGU on a proportionate basis. and it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation. the Group has a present legal or constructive obligation as a result of a past event. except for an impairment in respect to goodwill which is never reversed.20. if the recoverable amount of the asset increases as a result of a change in the estimates used to determine the recoverable amount. the recoverable amounts of the Group’s assets are assessed for indications of impairment at least annually.1 Ordinary shares Ordinary shares are classified as equity. and only when. Preference shares which do not meet the definition of an equity instrument are classified as liabilities. indefinite useful life intangible assets. the expected future cash flows from the asset are discounted to their present value using a discount rate that reflects current market assessments of the time value of money and the risks specific to the asset. Current contributions are charged against income as incurred. and a reliable estimate can be made of the amount of the obligation.17 Segment reporting Operating segments have been determined on a basis consistent with the internal reports reviewed by the Executive committee (“Exco”) when making strategic decisions for the Group. is reversed in the Statement of Comprehensive Income. An impairment loss is recognised in the Statement of Comprehensive Income whenever the carrying amount of an asset exceeds its recoverable amount. with interest expense recognised on an effective yield basis. net of transaction costs. Other financial liabilities are subsequently measured at amortised cost using the effective interest method. 4.2 Preference shares Preference shares issued which are convertible at the instance of the holder into other equity instruments. 4. are recognised when the dividends are declared by the board of directors. In assessing the value in use. the Group’s obligations are discharged.16 Provisions A provision is recognised when. Where the effect of the time value of money is material.19 Dividends declared Dividends. the amount of a provision is the present value of the expenditure expected to be required to settle the obligation. Distributions to the holders of preference shares which are classified as equity are shown in the statement of changes in equity as part of transactions with equity holders.20 Share capital 4. The recoverable amount of an asset is calculated as the higher of its fair value less cost to sell and its value in use. Exco considers the business based on the sectors in which they operate. 84 . but only to the extent that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset in prior years. Distributions to the holders of preference shares which are classified as liabilities are included in finance costs in the Statement of Comprehensive Income.Other financial liabilities include trade payables. Other financial liabilities are initially measured at fair value. The Group derecognises financial liabilities when. and the related tax thereon. or if not convertible are redeemable at the instance of the issuer. If there is an indication that an asset may be impaired.

indicate that the fair value differs from the transaction price. A list of the major subsidiaries. the share-based payment is measured as the difference between the fair value of the equity instruments granted and the fair value of the cash and other assets received (e. without modification or repackaging. 4.22 Related party transactions All subsidiaries. if vesting requirements are applicable. disclosure of contingent assets and liabilities at the date of the financial statements. is recognised in the Statement of Comprehensive Income immediately. differ from the ultimate actual results. Share appreciation rights granted to employees for the services rendered or to be rendered are raised as a liability and recognised in profit and loss immediately or. CRITICAL ACCOUNTING ESTIMATES AND JUDGEMENTS The preparation of the financial statements in conformity with IFRS requires the use of certain critical accounting estimates and assumptions that affect the reported amounts of assets and liabilities. with only observable market data as input.25 Government grants The carrying amounts of the assets to which the government grants/assistance relate to.g. The accounting estimates may. over the vesting period. including expectations of future events. and the reported amounts of revenues and expenses during the reporting period.1 Fair value methods and assumptions The best evidence of the fair value of a financial instrument on initial recognition is the transaction price.5 and 34.e. 5. Directors’ emoluments as well as transactions with other related parties are set out in notes 22. 85 . In a BEE transaction. The liability is measured annually until settled and any changes in value are recognised in profit and loss. i. joint ventures and associated companies of the Group are related parties. 4. Estimates are continually evaluated and are based on historical experiences and other factors. All transactions entered into with subsidiaries and associated companies were under terms no more favourable than those with third parties and have been eliminated in the consolidated Group accounts. which are considered to be reasonable in the circumstances. any resulting difference between the transaction price and the model value is deferred. by definition. based on management’s best knowledge of current events and actions and anticipated future events. or based on discounted cash flow models and option-pricing valuation techniques whose variables include only data from observable markets. the BEE equity credentials) and are recognised in profit and loss at the grant date unless there are service conditions in which case it is recognised over the relevant period of the service conditions. Fair value is measured using the trinomial-based option model. 5. the fair value of the consideration paid or received.23 Share-based payments Equity-settled share-based payments are measured at fair value at the date of grant and recognised in profit or loss on a straight-line basis over the vesting period based on the estimated number of shares that will eventually vest and adjusted for the effect of non-market-based vesting conditions. commonly referred to as day one profit or loss. have been reduced by the amount of the government grants given. Fair value is measured using a trinomialbased option pricing model. 4. this initial difference.24 Borrowing costs Borrowing cost is recognised as an expense in the period in which it is incurred. joint ventures and associated companies are included in the annual report. unless the fair value is evidenced by comparison with other observable current market transactions in the same instrument.21 Non-current assets (or disposal group) held for sale Non-current assets (or disposal groups) are classified as assets held for sale and stated at the lower of carrying amount and fair value less costs to sell if their carrying amount is recovered principally through a sale transaction rather than through continued use.4. If non-observable market data is used as part of the input to the valuation models. 4. When such valuation models. There were no other material contracts with related parties.

5. depending on the nature of the instrument and availability of market observable inputs. the fair value is determined using applicable valuation techniques such as price : earnings multiple. EBITDA multiple. the following accounting standards. Discounted cash flow valuations are based on cash flow budgets and forecasts prepared by management.4 Estimates regarding the impairment of associates The recoverable amount of the investment in associates is based on value in use. the Group determines fair values of its investments through valuation of the underlying assets in the respective investment companies.The timing of recognition of deferred day one profit or loss is determined individually. or realised through settlement. All owner changes in equity are recognised in a statement of changes in equity. If the market for a financial asset is not active or the instrument is an unlisted instrument. interpretations and amendments to published accounting standards were adopted: Accounting standard/ interpretation IAS 1 – Presentation of Financial Statements Type Amendment Description The principal change is that an entity must present all nonowner changes in equity in a statement of comprehensive income. net asset value and discounted cash flow valuation methodologies. 6. EBITDA multiple valuations are based on. This amendment had no effect on the Group’s results or net assets.3 Estimates regarding the impairment of intangible assets other than goodwill The recoverable amount of the trademarks is calculated using an appropriate trademark royalty rate and revenue budgets and forecasts prepared by management. Subsequent to initial recognition. net asset value and discounted cash flow methods. Where pricing models are used. 5. the fair values of financial assets and liabilities are based on quoted market prices or dealer price quotations for financial instruments traded in active markets. inputs are based on observable market indicators at the end of each reporting period and profits or losses are only recognised to the extent that they relate to changes in factors that market participants will consider in setting a price. 5. deferred until the instrument’s fair value can be determined using market observable inputs.2 Estimates regarding the impairment of goodwill The recoverable amount of the cash-generating unit(s) is determined using appropriate EBITDA multiples. It is either amortised over the life of the transaction. In situations where an investment vehicle is established to house the investment. inter alia. 86 . the Group has adopted these revised terminology changes.The EBITDA multiples used are determined with reference to the EBITDA multiples of comparable listed companies (both locally and overseas) and are adjusted for industry and other specific factors affecting the cash-generating unit. Management follows a conservative approach when determining estimates of earnings and multiples used for valuation purposes. In addition the amendment introduced changes to terminology including revised titles for the financial statements. ADOPTION OF NEW AND REVISED ACCOUNTING STANDARDS During the current financial year. The recoverable amounts of the manufacturing and distribution rights are calculated based on revenue budgets and forecasts prepared by management. Net asset value-based valuations are calculated based on the audited net asset value of the cash-generating unit at the end of the current year. Where earnings multiple or discounted cash flow analyses are used. the EBITDA achieved by a cash-generating unit for the year under review and budgets and forecasts prepared by management. estimated multiples and future cash flows are based on management’s best estimates and market-related discount rates at the end of each reporting period for a financial asset with similar terms and conditions.

Accounting standard/ interpretation IAS 8 – Accounting Policies, Changes in Accounting Estimates and Errors IAS 10 – Events after the Reporting Period

Type Amendment

Description The amendment changed the status of the implementation guidance. The amendment had no effect on the Group or Company to date. The amendment clarified that a dividend declared after the end of the reporting period is an adjusting event. This amendment had no effect on the Group’s results or net assets. The amendment resulted in changes to the recoverable amount definitions and accounting for sale of assets held for rental. The amendment has no effect on the Group or Company. The amendment relates to costs of originating a loan. The amendment relates to curtailments and negative past service cost, plan administration costs, replacement of the term “fall due” and additional guidance on contingent liabilities. The amendment had no effect on the Group or Company to date. The amendment relates to government loans with a below-market rate of interest and terminology changes to be consistent with other IFRSs. The amendment had no effect on the Group or Company to date. The amendment requires an entity to capitalise borrowing costs directly attributable to the acquisition, construction or production of a qualifying asset as part of the cost of that asset. The amendment had no effect on the Group or Company to date. The amendment requires the effects of all transactions with non-controlling interests to be recorded in equity if there is no change in control and these transactions will no longer result in goodwill or gains and losses. When control is lost any remaining interest in the entity is re-measured to fair value, and a gain or loss is recognised in profit or loss. The amendment had no effect on the Group or Company to date. The amendment requires disclosures when investments in associates are accounted for at fair value through profit or loss. The amendment had no effect on the Group or Company to date. The amended standards require entities to classify puttable financial instruments and instruments, or components of instruments that impose on the entity an obligation to deliver to another party a pro rata share of the net assets of the entity only on liquidation as equity, provided the financial instruments have particular features and meet specific conditions. The amendment had no effect on the Group or Company to date. The amendment clarifies that vesting conditions are service conditions and performance conditions only. The amendment had no effect on the Group or Company to date.

Amendment

IAS 16 – Property, Plant and Equipment

Amendment

IAS 18 – Revenue IAS 19 – Employee Benefits

Amendment Amendment

IAS 20 – Accounting for Government Grants and Disclosure of Government Assistance IAS 23 – Borrowing Costs

Amendment

Amendment

IAS 27 – Consolidated and Separate Financial Statements

Amendment

IAS 28 – Investments in Associates

Amendment

IAS 32 and IAS 1 – Financial Instruments Presentation Financial Statements – Puttable Financial Instruments and Obligations Arising on Liquidation

Amendment

IFRS 2 – Share Based Payments – Vesting Conditions and Cancellations

Amendment

87

Accounting standard/ interpretation IFRS 3 – Business Combinations

Type Amendment

Description The revised standard continues to apply the acquisition method to business combinations, some of the significant changes are, all payments to purchase a business are to be recorded at fair value at the acquisition date, with contingent payments classified as debt subsequently re-measured through the Statement of Comprehensive Income.There is a choice on an acquisition-by-acquisition basis to measure the non-controlling interest in the acquiree at fair value or at the non-controlling interest’s proportionate share of the acquiree’s net assets. All acquisition related costs should be expensed. The revision had no effect on the Group or Company to date. The amendment provides clarification that IFRS 5 specifies the disclosures required in respect of non-current assets (or disposal groups) classified as held for sale or discontinued operations. It also clarifies that the general requirements of IAS 1 still apply. The amendment had no effect on the Group or Company to date. The new standard requires a ‘management approach’, under which segment information is presented on the same basis as that used for internal reporting purposes. This has resulted in an increase in the number of reportable segments presented. In addition, the segments are reported in a manner that is more consistent with the internal reporting provided to the chief operating decision-maker. The new standard has had little impact on the Group’s reportable segments, as the Group’s segments reported on are consistent with the internal reporting provided to the chief operating decision-maker (Exco). The amendment requires an entity to assess whether an embedded derivative is to be separated from a host contract when the entity reclassifies a hybrid financial asset out of the fair value through profit or loss category. The amendment had no effect on the Group or Company to date. Re-assessment of embedded derivatives. The new interpretation had no effect on the Group or Company to date. The amendment states that, in a hedge of a net investment in a foreign operation, qualifying hedging instruments may be held by any entity or entities within the group, including the foreign operation itself, as long as the designation, documentation and effectiveness requirements of IAS 39 that relate to a net investment hedge are satisfied. The amendment had no effect on the Group or Company to date. The interpretation clarifies whether IAS 18, ‘Revenue’, or IAS 11, ‘Construction Contracts’, should be applied to particular transactions. IFRIC 15 is not relevant to the Group’s operations as all revenue transactions are accounted for under IAS 18 and not IAS 11.

IFRS 5 – Non-current Assets Held for Sale and Discontinued Operations

Amendment

IFRS 8 – Operating Segments

New Statement

IFRIC 9 – Reassessment of Embedded Derivatives

Amendment

IFRIC 9 and IAS 39 – Embedded Derivatives IFRIC 16 – Hedges of a Net Investment in a Foreign Operation

New Interpretation Amendment

IFRIC 15 – Agreements for the Construction of Real Estate

New Interpretation

88

Accounting standard/ interpretation IFRIC 17 – Distributions of Non-cash Assets to Owners

Type New Interpretation

Description This interpretation provides guidance on accounting for arrangements whereby an entity distributes non-cash assets to shareholders either as a distribution of reserves or as dividends. IFRS 5 has also been amended to require that assets are classified as held for distribution only when they are available for distribution in their present condition and the distribution is highly probable. The amendment had no effect on the Group or Company to date. This interpretation provides guidance on how to account for items of property, plant and equipment received from customers or cash that is received and used to acquire or construct specific assets. This interpretation is only applicable to such assets that are used to connect the customer to a network or to provide ongoing access to a supply of goods or services or both. The amendment had no effect on the Group or Company to date. A prepayment may only be recognised in the event that payment has been made in advance of obtaining right of access to goods or receipt of services. The amendment had no effect on the Group or Company to date. This amendment clarifies that it is possible for there to be movements into and out of the fair value through profit or loss category where a derivative commences or ceases to qualify as a hedging instrument in cash flow or net investment hedge and that a financial asset or liability that is part of a portfolio of financial instruments managed together with evidence of an actual recent pattern of short-term profit taking is included in such a portfolio on initial recognition. The amendment had no effect on the Group or Company to date. The new interpretation guidance on the application of IFRIC 14 – IAS 19 The Limit on the Defined Benefit Asset, Minimum Funding Requirements and their Interaction in South Africa in relation to the defined benefit pension obligations. The interpretation had no effect on the Group or Company to date. The amended standard allows first-time adopters to use a deemed cost of either fair value or the carrying amount under previous accounting practice to measure the initial cost of investments in subsidiaries, jointly controlled entities and associates in the separate financial statements. The amendment also removes the definition of the cost method from IAS 27 and replaces it with a requirement to present dividends as income in the separate financial statements of the investor. The amendment is not relevant to the Group as the Group has adopted IFRS. The amendment requires enhanced disclosures about fair value measurement and liquidity risk. In particular, the amendment requires disclosure of fair value measurements by level of a fair value measurement hierarchy. As the change in accounting policy only results in additional disclosures, there is no impact on earnings per share. See note 34.4 to the financial statements

IFRIC 18 – Transfers of Assets from Customers

New Interpretation

IAS 38 – Intangible Assets

Amendment

IAS 39 – Financial Instruments: Recognition and Measurement Eligible Hedged Items

Amendment

AC 504 – IAS 19(AC 116) The Limit on a Defined Benefit Asset, Minimum Funding Requirements and Their Interaction in The South African Pension Fund Environment IFRS 1 – First-Time Adoption of International Financial Reporting Standards – IAS 27 – Consolidated and Separate Financial Statements Cost of an Investment in a Subsidiary, Jointly Controlled Entity or Associate

New Interpretation

Amendment

IFRS 7 – Financial Instruments Disclosures Improving Disclosures about Financial Instruments

Amendment

At the date of issue of these financials, the following accounting standards, interpretations and amendments to published accounting standards were in issue but not yet effective:

89

Assets and Liabilities IFRS 9 – Financial Instruments – Classification and Measurement IAS 27 – Consolidated and Separate Financial Statements IAS 24 – Related Party Disclosures IAS 32 – Financial Instruments – Presentation and Disclosure IAS 36 – Impairment of Assets IAS 39 – Financial Instruments: Recognition and Measurement Scope Exemption for Business Combination Contracts and Cash Flow Hedge Accounting Type Amendment Effective date Financial years commencing on or after 1 January 2010 Amendment Financial years commencing on or after 1 January 2011 Amendment Amendment Amendment Amendment Financial years commencing on or after 1 January 2010 Financial years commencing on or after 1 January 2010 Financial years commencing on or after 1 January 2010 Financial years commencing on or after 1 January 2010 Amendment Amendment Financial years commencing on or after 1 January 2011 Financial years commencing on or after 1 January 2010 Amendment Amendment Financial years commencing on or after 1 January 2010 Financial years commencing on or after 1 January 2010 New standard Amendment Amendment Amendment Amendment Amendment Financial years commencing on or after 1 January 2013 Financial years commencing on or after 1 January 2011 Financial years commencing on or after 1 January 2011 Financial years commencing on or after 1 February 2010 Financial years commencing on or after 1 January 2010 Financial years commencing on or after 1 January 2010 Improvements Projects Improvements to IFRS’s Financial years commencing on or after 1 January 2010 The directors have not yet determined what the impact of these new standards and interpretations on the Company will be. 90 .Accounting standard/ interpretation IAS 1 – Presentation of Financial Statements – Classification of Convertible Instruments as Either non-Current or Current IAS 1 – Presentation of Financial Statements – Clarification of Statement of Changes in Equity IAS 7 – Statement of Cash Flows IAS 17 – Leases IAS 18 – Revenue IFRS 2 – Share-Based Payments – Group Cash-settled Share-based Payment Transactions IFRS 3 – Business Combinations IFRS 5 – Non-current Assets Held for Sale and Discontinued Operations IFRS 7 – Financial Instruments IFRS 8 – Operating Segments – Disclosure of information regarding Profit and Loss.

PROPERTY.NOTES TO THE FINANCIAL STATEMENTS 7. PLANT AND EQUIPMENT GROUP: 2010 Accumulated depreciation and impairment R’000 – (145 478) (15 613) (83 654) (26 185) (159 697) (20 422) (451 050) Cost R’000 Land and buildings Plant and equipment Office equipment Computer equipment Furniture and fittings Motor vehicles Improvements to leasehold premises 6 216 278 908 18 457 103 231 33 710 364 058 34 089 838 669 Reconciliation of net book value Reclassified to disposal group classified as held for sale R’000 – (3 381) – – – – – (3 381) Net book value R’000 6 216 133 429 2 844 19 577 7 525 204 361 13 667 387 619 Net book value 30 June 2009 R’000 Land and buildings Plant and equipment Office equipment Computer equipment Furniture and fittings Motor vehicles Improvements to leasehold premises 4 962 136 697 3 252 18 640 6 108 132 573 10 370 312 602 Analysis of additions Replacement of assets Expansion of business Reclassification R’000 – (5 631) 276 193 441 65 4 094 (562) Government grants R’000 – (1 180) – – – (252) (569) (2 001) Additions R’000 1 367 49 379 595 8 528 4 913 123 064 8 695 196 542 52 235 144 306 196 541 Disposals¹ R’000 (113) (4 926) 852 (252) (1 570) 113 (5 896) Depreciation and impairment R’000 – (37 529) (1 279) (8 636) (3 685) (49 519) (9 036) (109 684) Net book value 30 June 2010 R’000 6 216 133 429 2 844 19 577 7 525 204 361 13 667 387 619 GROUP: 2009 Accumulated depreciation and impairment R’000 – (128 040) (14 374) (77 863) (23 269) (121 227) (11 499) (376 272) Cost R’000 Land and buildings Plant and equipment Office equipment Computer equipment Furniture and fittings Motor vehicles Improvements to leasehold premises 4 962 264 737 17 626 96 503 29 377 253 800 21 869 688 874 Net book value R’000 4 962 136 697 3 252 18 640 6 108 132 573 10 370 312 602 91 .

Reconciliation of net book value Net book value 30 June 2008 R’000 Land and buildings Plant and equipment Office equipment Computer equipment Furniture and fittings Motor vehicles Improvements to leasehold premises 4 962 114 675 4 791 15 495 6 806 107 853 11 676 266 258 Analysis of additions Replacement of assets Expansion of business Net book value 30 June 2009 R’000 4 962 136 697 3 252 18 640 6 108 132 573 10 370 312 602 Additions R’000 – 117 831 849 12 238 2 557 68 199 2 271 203 865 53 490 150 375 203 865 Disposals¹ R’000 – (44 214) (491) 191 (807) (5 699) (848) (51 868) Depreciation and impairment R’000 – (51 595) (1 897) (9 284) (2 448) (37 700) (2 729) (105 653) ¹ Excluded from disposal is R154 006 000 in property. GROUP: 2008 Accumulated depreciation and Cost impairment R’000 R’000 Land and buildings Plant and equipment Office equipment Computer equipment Furniture and fittings Motor vehicles Improvements to leasehold premises 4 962 465 686 17 542 86 470 29 920 223 003 20 784 848 367 Reconciliation of net book value Net book value 30 June 2007 R’000 Land and buildings Plant and equipment Office equipment Computer equipment Furniture and fittings Motor vehicles Improvements to leasehold premises 4 951 250 983 6 447 17 656 7 327 95 615 5 324 388 302 Analysis of additions Replacement of assets Expansion of business Depreciation and impairment R’000 – (143 986) (2 918) (9 965) (3 218) (34 359) (2 271) (196 717) Reclassified as held for sale R’000 – (148 048) – (283) (1 393) (4 282) – (154 006) Net book value 30 June 2008 R’000 4 962 114 675 4 791 15 495 6 806 107 853 11 676 266 258 Reclassified as held for sale R’000 – (148 048) – (283) (1 393) (4 282) – (154 006) Net book value R’000 4 962 114 675 4 791 15 495 6 806 107 853 11 676 266 258 – (202 963) (12 751) (70 692) (21 721) (110 868) (9 108) (428 103) Additions R’000 11 176 897 1 287 8 814 4 380 57 906 9 437 258 732 102 394 156 338 258 732 Disposals R’000 – (21 171) (25) (727) (290) (7 027) (814) (30 054) 92 . Refer to Note 16. plant and equipment re-classified in the prior period now disposed off with the disposal of Trollope Mining Services (Pty) Ltd.

Trollope Mining Services has been disposed off on 1 October 2008. INTANGIBLE ASSETS GROUP: 2010 Accumulated amortisation and impairment R’000 (526) (40 638) – (41 164) Net book value R’000 61 013 6 789 64 829 132 631 Cost R’000 Trademarks Computer software Manufacturing and distribution rights 61 539 47 427 64 829 173 795 Reconciliation of net book value Net book value 30 June 2009 R’000 Trademarks Computer software Manufacturing and distribution rights 61 013 3 994 64 829 129 836 Additions R’000 – 6 299 – 6 299 Disposals¹ R’000 – 562 – 562 Amortisation and impairment R’000 – (4 066) – (4 066) Net book value 30 June 2010 R’000 61 013 6 789 64 829 132 631 93 . Pretoria.The useful life of the buildings is estimated to be 50 years.Property.2 estimates and judgements. certain of the Group’s assets are encumbered by instalment sale agreements and capitalised finance leases as described in note 18. Land and buildings comprise portion 135. Farm Waterval 273. plant and equipment re-classified to disposal group classified as held for sale amounts to R154 006 000 and relates to assets which belonged to Trollope Mining Services (part of the consumer segment). 9. GOODWILL 2010 R’000 Deemed cost Accumulated impairments 431 637 (18 933) 412 704 Reconciliation of net book value Net book value at the beginning of the year Acquisitions of subsidiaries Disposals of subsidiaries Impairment losses 414 164 – – (1 460) 412 704 Group 2009 R’000 441 290 (27 126) 414 164 406 827 7 337 – – 414 164 2008 R’000 433 953 (27 126) 406 827 401 691 27 126 (10 504) (11 486) 406 827 The impairment testing on goodwill is documented as part of note 5. 8. No depreciation was provided for on land and buildings as the estimated residual values equals to or exceeds the carrying value.

During the 2009 financial year trademark to the value of R526 000 used by Blacksteer was impaired. 94 .GROUP: 2009 Accumulated amortisation and impairment R’000 (526) (33 590) – (34 116) Cost R’000 Trademarks Computer software Manufacturing and distribution rights 61 539 37 584 64 829 163 952 Reconciliation of net book value Net book value 30 June 2008 R’000 Trademarks Computer software Manufacturing and distribution rights 61 539 8 344 57 907 127 789 GROUP: 2008 Net book value R’000 61 013 3 994 64 829 129 836 Additions R’000 – 7 030 6 922 13 952 Amortisation and impairment R’000 (526) (11 380) – (11 906) Net book value 30 June 2009 R’000 61 013 3 994 64 829 129 836 Cost R’000 Trademarks Computer software Manufacturing and distribution rights 61 539 30 554 57 907 150 000 Reconciliation of net book value Net book value 30 June 2007 R’000 Trademarks Computer software Manufacturing and distribution rights 61 539 19 549 – 81 088 Accumulated amortisation and impairment R’000 – (22 210) – (22 210) Net book value R’000 61 539 8 344 57 907 127 790 Additions R’000 – – 57 905 57 905 Amortisation and impairment R’000 – (11 204) – (11 204) Net book value 30 June 2008 R’000 61 539 8 344 57 907 127 789 Trademarks comprise the trademarks used by Coin Security. King Pie and Blacksteer.

INVESTMENTS IN ASSOCIATES 2010 R’000 Tangible assets Goodwill Shares at cost Group’s share of post-acquisition reserves Loan receivables Accumulated impairment of investments in associates – 2 2 8 267 – – 8 269 Reconciliation of the carrying value of investments in associates Carrying value at the beginning of the year Share of net attributable profit of associated companies¹ Net acquisitions/(disposals) of investments in associates Net decrease in loan receivables Impairment of investment in associated companies Carrying value at the end of the year Directors’ valuation of shares² Unlisted shares ¹ Share of profit is after tax and minority interest in associates.0 Country of incorporation Assets R’000 91 581 21 479 113 060 Liabilities R’000 71 953 14 639 86 592 Revenues R’000 2 512 214 35 392 2 547 606 Profit/(Loss) R’000 8 620 4 241 12 861 RSA RSA % interest held Name of associated company 2009 Experience Delivery Company (Proprietary) Limited Country of incorporation Assets R’000 Liabilities R’000 Revenues R’000 Profit/(Loss) R’000 48.0 49 Country of incorporation Assets R’000 16 194 20 981 – – 37 175 Liabilities R’000 12 229 14 504 – – 26 733 Revenues R’000 62 662 19 480 – – 82 142 Profit/(Loss) R’000 (72) 1 337 – – 1 265 RSA RSA RSA UAE 95 . Group 2009 R’000 1 827 2 1 829 6 299 – (1 827) 6 301 2008 R’000 3 650 1 005 4 655 5 758 2 690 (865) 12 238 6 301 1 968 – – – 8 269 8 269 12 238 3 162 (5 353) (2 784) (962) 6 301 6 301 11 215 1 439 1 649 (1 200) (865) 12 238 12 238 % interest held Name of associated company 2010 Ilembe Airport Construction Experience Delivery Company (Proprietary) Limited 20 48.10.0 RSA 25 693 25 693 17 153 17 153 30 980 30 980 2 003 2 003 % interest held Name of associated company 2008 Telesafe (Proprietary) Limited Resolution Insurance Copmany (Proprietary) Limited Experience Delivery Company (Proprietary) Limited Al Jaber Coin LLC 49 40 48. ² Directors’ valuation of shares is an indicative of the fair value of Group’s investment in associates.

The Knock-in event occurs when on any reset date the floating rate is equal to or lower than the barrier level.53% and the barrier level is at 11. INVENTORIES 2010 R’000 Raw materials Work in progress Consumables Merchandise and finished goods Reclassified to assets in disposal group held for sale 12 189 4 622 14 479 10 318 – 41 608 Group 2009 R’000 12 274 2 834 7 797 17 006 – 39 911 2008 R’000 12 475 711 10 819 14 272 (741) 37 536 96 . The floating rate is based on three-month JIBAR with reset dates on 30 March.05%. June. OTHER INVESTMENTS 2010 R’000 Loan receivables Accumulated net fair value losses arising on revaluation of strategic investments 80 183 (48 268) 31 915 Comprising Non-current investments Current investments 16 362 15 553 31 915 Reconciliation of the carrying value of other investments Carrying value at the beginning of the year 43 807 Net acquisitions of subsidiaries and other businesses – Investments disposed (10 080) Net fair value gains/(losses) arising on revaluation of strategic investments (1 812) 31 915 Directors’ valuation of shares Unlisted investments 12. The cap or floor rate is at 12. FINANCIAL ASSETS AND LIABILITIES 2010 Financial Financial asset liability R’000 R’000 Derivative financial instrument classified as held for trading with fair value through profit and loss Group 2009 Financial Financial asset liability R’000 R’000 2008 Financial Financial asset liability R’000 R’000 31 915 Group 2009 R’000 90 263 (46 456) 43 807 32 553 11 254 43 807 63 614 1 200 (21 035) 28 43 807 43 807 2008 R’000 106 856 (46 484) 60 372 40 255 20 117 60 372 83 056 1 497 (19 567) (4 614) 60 372 60 372 – – 36 900 36 900 – – 34 199 34 199 3 242 3 242 – – On 20 June 2008 the Group entered into a “Zero Premium Knock-in-Swap” with Absa Capital on a notional amount of R330 000 000. September and December.11. 13.

CASH AND CASH EQUIVALENTS Bank balances Term deposits Liquid investments Reclassified to assets in disposal group held for sale 368 551 6 235 23 – 374 809 204 352 5 897 2 – 210 251 215 300 4 914 3 (1 067) 219 150 16. plant and equipment Inventories Goodwill Trade and other receivables Cash and cash equivalents Assets in disposal group held for sale The disposal group includes the following liabilities: Non-current interest bearing liabilities Deferred taxation Trade and other payables Current interest bearing liabilities Tax liabilities Liabilities in disposal group held for sale Analysis of the result of discontinued operations is as follows: Revenue Operating expenses Profit before tax from discontinued operations 3 381 – 1 460 204 – 5 045 – – – – – – – – – – – – – – – – – – 154 006 741 124 481 1 067 280 295 44 165 12 966 68 632 48 934 2 198 176 895 63 657 (62 502) 1 155 63 636 (62 103) 1 533 – – – 97 . TRADE AND OTHER RECEIVABLES 2010 R’000 Trade receivables Less: Provision for impairment of trade receivables 583 281 (54 569) 528 712 Prepayments Other receivables Reclassified to assets in disposal group held for sale 37 301 197 863 – 763 876 Group 2009 R’000 502 580 (44 103) 458 477 36 764 210 226 – 705 467 2008 R’000 546 360 (50 596) 495 764 28 625 179 559 (124 481) 579 467 15. DISPOSAL GROUP HELD FOR SALE The disposal group includes the following assets: Property.14.

and are repayable in equal monthly instalments of R6 482 000 (2009: R6 477 000) (2008: R4 948 000). INTEREST BEARING LIABILITIES Asset-based finance Secured Capitalised finance leases Total amount owing Current portion included in current liabilities Secured by property.17.00 each¹ Issued 100 ordinary shares of R1. The liabilities bear interest at rates linked to the prime overdraft rate ranging between 9% and 12% per annum. plant and equipment with a net book value of R201 291 000 (2009: R156 562 000) (2008: R114 864 000).00 each¹ ¹ The issued and authorised ordinary share capital of the Company is R100. SHARE CAPITAL 2010 R’000 Authorised 100 ordinary shares of R1. Reconciliation to present value of finance lease liabilities: Gross finance lease liabilities minimum lease payments: No later than 1 year Later than 1 year and no later than 5 years Later than 5 years Finance charges: No later than 1 year Later than 1 year and no later than 5 years Later than 5 years Present value of future lease payments: No later than 1 year Later than 1 year and no later than 5 years Later than 5 years 225 324 88 010 137 314 – (32 025) (13 135) (18 890) – 193 299 74 875 118 424 – 163 672 72 070 91 602 – (19 613) (11 028) (8 585) – 144 059 61 042 83 017 – 153 027 60 910 91 571 546 (27 505) (13 415) (14 086) (4) 125 522 47 495 77 485 542 118 424 193 299 (74 875) 83 017 144 059 (61 042) 78 027 125 522 (47 495) 98 . Group 2009 R’000 – – 2008 R’000 – – – – 18.

Other loans Total amount owing Current portion included in current liabilities The loans are interest free. 18 136 18 136 – 22 324 22 324 – 1 401 1 401 – 722 117 722 117 – 566 362 566 362 – 848 870 848 870 – 99 . The liabilities bear interest at rates linked to the prime overdraft rate ranging between 9% and 11% per annum. plant and equipment with a net book value of R7 631 000 (2009: R5 937 000) (2008: R146 521 000). unsecured and have no fixed repayment terms. and are repayable in equal monthly instalments of R271 000 (2009: R271 000) (2008: R239 000). Other liabilities borrowed Unsecured Preference shares Total amount owing Current portion included in current liabilities Mvelaphanda Treasury and Financial Services (Pty) Ltd Total amount owing Current portion included in current liabilities Interest bearing liabilities 482 438 482 438 – – 100 478 (100 478) 783 971 4 608 7 755 (3 147) Group 2009 R’000 3 697 6 306 (2 609) 2008 R’000 48 961 99 964 (51 003) 482 438 482 438 – – 93 560 (93 560) 726 363 – – – – 74 397 (74 397) 299 883 19. NON-INTEREST BEARING LIABILITIES Unsecured Term loan Total amount owing Current portion included in current liabilities The loan was interest free and unsecured and repayable on demand.2010 R’000 Instalment sales agreement Total amount owing Current portion included in current liabilities Secured by property.

20. DEFERRED TAXATION 2010 R’000 Balance at the beginning of the year Wear and tear Doubtful debts Prepayments Special taxation allowances Revaluation of investments Estimated assessed tax losses Provisions and accruals Operating lease accrued Revenue received in advance/deferred revenue Other Prior year over/(under) provision Wear and tear Doubtful debts Prepayments Estimated assessed loss Provisions and accruals Other Adjustment due to rate change Wear and tear Doubtful debts Prepayments Special taxation allowances Revaluation of investments Estimated assessed loss Other Acquisition/(disposals) of subsidiaries Wear and tear Doubtful debts Prepayments Special taxation allowances Estimated assessed loss Provisions and accruals Other Charged to the income statement Wear and tear Doubtful debts Prepayments Special taxation allowances Revaluation of investments Estimated assessed loss/(tax losses) Provisions and accruals Operating lease accrued Revenue received in advance/deferred revenue Other (23 370) 9 986 (5 881) 5 994 17 475 33 (24 068) (11 004) (222) (11) (15 673) (233) – (219) – – (14) – – – – – – – – – – – – – – – – – 8 755 1 420 1 012 (2 700) 2 307 – 6 696 788 (177) 1 729 (2 320) Group 2009 R’000 (9 115) 23 269 (6 315) 2 536 15 168 454 (29 385) – – – (14 842) 395 212 (45) 187 47 – – – – – – – – – – (15 561) (17 303) – (123) – 6 294 (3 609) (820) 474 3 808 479 3 394 2 307 (421) (1 023) (7 389) (222) – (11) 2008 R’000 (35 785) 13 317 (3 012) 3 660 13 417 – (49 149) – – – (14 018) – – – – – – – (382) (459) 104 (126) (463) (138) 1 072 392 2 078 3 56 – (94) 2 070 – 43 10 859 10 408 (3 463) (998) 2 307 454 3 480 – – – (1 329) 100 .

TRADE AND OTHER PAYABLES Trade and other payables Accruals Deferred revenue 733 656 29 773 30 307 793 736 22. PROFIT FROM OPERATIONS 23.2010 R’000 Balance at the end of the year Wear and tear Doubtful debts Prepayments Special taxation allowances Revaluation of investments Estimated assessed tax losses Provisions and accruals Operating lease accrued Revenue received in advance/deferred revenue Other Comprising Deferred tax assets Deferred tax liabilities (17 520) 2 671 (14 849) 21.1 Auditors’ remuneration Audit fees Current year Underprovision prior years Other services 444 485 (41) (145) 299 (14 849) 11 406 (5 087) 3 293 19 782 33 (17 372) (10 230) (399) 1 718 (17 993) Group 2009 R’000 (23 370) 9 986 (5 881) 5 994 17 475 33 (24 067) (11 004) (222) (11) (15 673) 2008 R’000 (22 466) 23 268 (6 315) 2 536 15 168 316 (42 527) – – – (14 8912) (32 984) 9 614 (23 370) (28 461) 5 995 (22 466) 672 485 49 292 26 225 748 002 648 910 40 826 32 330 722 066 3 664 893 (63 636) 3 601 257 3 463 275 – 3 463 275 7 004 6 448 556 785 7 789 5 030 4 795 235 122 5 152 101 . REVENUE Revenue for the period Less: Revenue from discontinued operation 4 125 655 (63 657) 4 061 998 23.

6 Rentals under operating leases Land and buildings Equipment Motor vehicles Other 20 540 2 396 41 162 23 139 23.8 23. plant and equipment Foreign currency gains 2 242 258 2 065 820 1 696 Group 2009 R’000 2008 R’000 51 595 1 897 9 284 2 448 37 700 2 729 105 653 11 266 11 266 82 781 2 920 9 983 2 609 34 339 2 272 134 904 11 204 11 204 1 515 085 33 037 93 177 1 641 299 1 430 371 35 813 83 602 1 549 786 – – – – – – – – 51 153 3 791 47 – 54 991 276 252 9 166 2 267 198 48 197 5 527 137 – 53 861 595 2 708 1 899 5 477 1 849 23. plant and equipment 23.11 Administration fees received 24.7 23.10 Profit on disposal of property.4 Employee costs Salaries and bonuses Fringe benefits Pension/Provident/Medical Fund contributions 1 782 339 35 074 117 688 1 935 101 23.3 Computer software (11 189) (11 189) 23.2 Depreciation and impairment Plant and equipment Office equipment Computer equipment Furniture and fittings Motor vehicles Improvements to leasehold premises 37 529 1 279 8 636 3 685 49 519 9 036 109 684 23.5 Directors’ emoluments Salaries and bonuses Fringe benefits Pension/Provident/Medical Fund contributions 5 414 371 95 5 880 23.9 Foreign currency losses Loss on disposal of property.2010 R’000 23. INTEREST PAID Interest expense Preference dividends paid Finance charges 21 851 40 569 15 523 77 943 12 624 77 110 20 758 110 492 15 574 – 14 767 30 341 102 .

TAXATION EXPENSE South African normal tax Current year Prior year (over)/under provision Deferred tax Normal tax Capital Gains Tax Prior year (over)/under provision Adjustment due to rate change Capital Gains Tax Secondary Tax on Companies Foreign tax 67 372 68 524 (1 152) 8 521 8 754 – (233) – 1 2 236 2 152 80 282 63 308 – 72 870 475 – 395 – 341 7 835 398 72 753 55 402 55 511 (109) 11 241 10 405 454 – 382 222 317 382 67 564 103 . FAIR VALUE ADJUSTMENTS AND PROFIT/(LOSS) FROM INVESTMENTS 2010 R’000 Net fair value adjustment on financial instruments designated through profit and loss Derivate financial instrument held for trading with fair value through profit and loss Net realised loss on disposal of investments (1 812) (2 701) 1 787 (2 726) 2009 R’000 28 (40 091) (600) (40 663) 2008 R’000 (4 614) 3 241 (14 290) (15 663) 26.25. SHARE OF LOSS FROM ASSOCIATES Group’s share of retained income Dividend income Impairment of investments in associates 1 968 4 107 – 6 075 3 161 1 264 (962) 3 463 1 439 50 (865) 624 27.

CASH PAID TO SUPPLIERS AND EMPLOYEES Revenue Profit from operations Depreciation and impairment of intangible assets Net profit on disposal of property. CASH RECEIVED FROM CUSTOMERS Revenue Movement in trade and other receivables 4 126 655 (58 406) 4 067 249 3 664 893 (126 084) 3 538 809 3 463 275 (192 516) 3 270 759 29.2010 R’000 Reconciliation of taxation amount South African normal tax amount Adjusted for: Disallowable expenditure Income from associates Impairment losses on goodwill Exempt income and exceptional items Investment and other special allowances Prior year (over)/under provision Utilisation of previously unrecognised assessed losses Assessed losses Effect of deferred tax balance due to rate change Other Total normal tax Change in income tax rate Capital Gains Tax Secondary Tax on Companies Foreign tax Effective taxation Estimated taxation losses Net estimated normal tax losses available for utilisation against future taxable income Potential taxation relief at current taxation rates 65 560 10 333 297 (551) (1 767) (6 505) (16) (1 715) – 20 529 – 61 75 893 – – 2 237 2 152 80 282 2009 R’000 2008 R’000 17 110 47 068 26 795 (885) 98 (355) 16 278 467 (42) 16 308 – (11 596) 64 178 – 342 7 835 399 72 753 22 120 43 686 27 383 (1 826) 4 559 (35 692) (588) – – 24 674 – 25 176 65 806 382 677 317 382 67 564 325 723 91 202 242 150 67 802 157 775 44 177 28. plant and equipment Movement in inventories Movement in trade and other payables 4 125 655 (291 287) 3 834 368 (109 683) (562) 517 (656) (36 965) 3 687 020 3 664 893 (192 124) 3 472 769 (105 653) (11 906) 1 810 2 395 (89 438) 3 269 977 3 463 275 (109 314) 3 353 961 (134 906) (92 627) 47 486 4 609 (108 514) 3 070 009 104 .

plant and equipment Working capital changes 291 287 109 682 562 (517) (20 785) 380 229 31. TAXATION PAID Unpaid at the beginning of the year and on acquisitions of subsidiaries Charged to the income statement Unpaid at the end of the year 507 71 761 (13 609) 8 243 73 623 (507) 8 960 56 323 (10 154) (2 395) (126 084) 89 438 (39 041) (4 609) (192 516) 108 514 (88 611) 2009 R’000 192 124 105 653 11 906 (1 810) (39 041) 268 832 2008 R’000 109 314 134 906 92 627 (47 485) (88 612) 200 750 58 659 33. CASH GENERATED FROM OPERATIONS 2010 R’000 Profit from operations Depreciation and impairment of intangible assets Net profit on disposal of property. plant and equipment Investments in subsidiaries Other investments Inventory Trade and other receivables Cash and cash equivalents Trade and other payables Non-current interest bearing liabilities Deferred taxation Normal taxation Net assets acquired Minority interest Goodwill Loss on disposal 1 120 – – 2 352 – – (654) – – – 2 818 – – – 2 818 Satisfied by: Cash Loans – 2 818 2 818 Net cash effect – 81 359 55 129 (200 188) – 1 200 (761) (133 222) (6 729) 109 811 109 696 15 561 1 911 (102 721) 427 7 337 872 (94 085) (94 086) 1 (94 085) 87 357 (3 310) – 1 497 (1 482) (23 980) (626) 30 957 2 152 (3 024) (721) 1 463 (445) 16 622 12 632 30 272 15 067 15 205 30 272 15 693 105 .30. NET ACQUISITION/(DISPOSAL) OF SUBSIDIARIES Property. WORKING CAPITAL CHANGES Inventories Trade and other receivables Trade and other payables 656 (58 406) 36 965 (21 941) 32.

# less than R1 000.Subsidiaries and businesses acquired during the 2009 financial year relate mainly to the acquisition of the remaining 22. A full list of subsidiaries has been provided in Annexure 7 to this Pre-listing Statement. 106 .1 Parent company Mvela Group Limited is the controlling company of Mvelaserve Limited. The following assets and liabilities are in respect of the Mvela Group: 2010 R’000 Assets Trade and other receivables Treasury debtors 97 878 459 777 557 655 Liabilities Non-interest bearing liabilities Interest bearing liabilities Treasury creditors 722 117 100 478 129 212 951 807 34. RELATED-PARTY TRANSACTIONS 34. All principal subsidiaries are incorporated in South Africa. All transactions between Mvelaserve Group and Mvela Group are concluded at arm’s length.5% interest in RoyalSechaba Food Services (Proprietary) Limited by RoyalSechaba. where material. 34. Subsidiaries and businesses sold during the 2010 financial year related to a disposal by the Protea Coin Group.2 Subsidiary companies Details of principal subsidiary companies at 30 June 2010 Nature of Issued business capital (refer to notes) R’000 # # # # # # # 1 2 3 3 4 5 6 2009 R’000 97 878 353 065 450 943 566 362 93 560 159 997 819 919 2008 R’000 105 950 229 718 335 668 848 870 74 397 204 184 1 127 451 Holding % Khuseti Holdings (Pty) Limited Mvelaserve Cleaning (Pty) Limited Protea Coin (Armed reaction and Assets-in-transit) (Pty) Limited Protea Coin (Physical and Technical Security) (Pty) Limited Rebhold Freight Services (2000) (Pty) Limited Mvelaserve Catering (Pty) Limited TFMC Holdings (Pty) Limited 100 100 100 100 100 100 100 Loans R’000 29 474 91 282 190 375 37 612 124 146 78 380 – 551 269 Notes: Details are given in respect of interests in subsidiaries. Loans are non-interest bearing with no fixed repayment terms. Subsidiaries and businesses sold during the 2009 financial year relate mainly to the sale of a 100% interest in Trollope Mining Services (Proprietary) Limited.

Cleaning services 3. and existing bank facilities. 34. inter-company transactions are eliminated. Operating leases The minimum commitments are: Land and buildings Equipment Motor vehicles Total operating lease commitments Less: Amounts accrued as a result of accounting for operating leases on the straight-line basis Net operating lease commitments not provided for Analysis of total operating lease commitments: Due in year one Due in year two Due in year three Due in year four Thereafter 111 737 4 913 325 116 975 (1 191) 115 784 24 080 18 871 16 211 16 680 39 941 115 783 51 153 3 791 47 54 991 (226) 54 765 21 628 17 324 7 182 5 488 3 143 54 765 48 197 5 527 137 53 861 (93) 53 768 19 250 15 030 10 273 3 726 5 488 53 767 107 .4 Directors – The names of the directors of Mvelaserve Group are set out in paragraph 17 to this Pre-listing Statement. 34. – Details of directors’ emoluments are set out in paragraph 18 of this Pre-listing Statement. CAPITAL COMMITMENTS 2010 R’000 Capital expenditure Commitments in respect of capital expenditure approved by the directors: Contracted for Not contracted for 2009 R’000 2008 R’000 16 354 9 770 26 124 11 798 18 589 30 387 30 538 13 075 43 613 The above commitments are to be financed from cash and cash equivalents. Security services 5. 34.Nature of businesses 1.3 Associated companies Details of investments in associated companies are disclosed in note 10. Catering services 7. Security services 4. Facilities management All transactions between Mvelaserve Group and/or subsidiary companies are concluded at arm’s length. Franchise and manufacturing 2. On consolidation. and the associated companies are concluded at arm’s length. All transactions between Mvelaserve Group and/or its subsidiary companies. Freight forwarding services 6.5 Shareholders – Mvelaphanda Group Limited owns 100% of the Group’s issued share capital 35.

1 Bank facilities Bank facilities of certain subsidiaries are secured by a negative pledge over certain assets and a cession of book debts of R28 800 000 (2009: R134 770 000) (2008: R130 977 000). The majority of rentals under property lease renewal options are determined with reference to market rentals at the time of renewal. issue new shares or sell assets to reduce debt. Incident was settled in 2009. Compliance with these policies and procedures is monitored through the internal audit function and reported to the Audit Committee and the Board on a regular basis. Credits in respect of secondary tax on companies. amounted to R nil (2008: R nil).2 Capital risk management The Group’s objectives when managing capital are to safeguard the Group’s ability to continue as a going concern in order to provide returns for shareholders and benefits for other stakeholders and to maintain an optimal structure to reduce the cost of capital. In the course of the Group’s business operations it is exposed to financial risk relating to liquidity. 6 736 11 585 Group 2009 R’000 14 839 11 334 2008 R’000 32 501 – 108 . foreign currency. are between 1 and 5 years. where these exist. FINANCIAL INSTRUMENTS 37.4 Outstanding litigation Protea Aviation Security (Proprietary) Limited has been named as second defendant with KLM Royal Dutch Airlines (as first defendant) in a claim relating to the alleged theft of approximately US$9. Investigations carried out to date and legal opinion obtained indicates that the Group is unlikely to be held liable for any amounts in respect of this case. Risk management relating to each of this risk is detailed below: 37. 36. credit. Loans between certain subsidiary companies have been subordinated in favour of the other creditors of the debtor companies. available for setoff by the Group against future dividends. The Group at present has negative distributable reserves and thus unlikely to distribute dividends. In order to maintain or adjust the capital structure.3 Secondary Tax on Companies STC is levied on dividends distributed at a rate of 10% with effect from 1 October 2007 (previously 12.Material lease commitments relate mainly to immovable property. 36. CONTINGENT LIABILITIES 36. the Group may adjust the amount of dividends paid to shareholders. This ratio is calculated as net debt divided by total capital. 37. Rentals on certain leases escalate annually. vehicles and equipment.1 Financial risk management objective The Board of Directors is ultimately responsible for the management of risk. There are no contingent rental payments. Renewal options.The Group monitors capital on the basis of a gearing ratio. Specific details and terms of leases vary between different contracts. In order to discharge this responsibility the Board has put in place various policy and procedure frameworks that are applicable at various levels of the organisation.65 million foreign currency and valuable cargo during an alleged robbery which took place at Johannesburg International Airport in December 2001. 36. return capital to shareholders. Total equity is as shown in the consolidated balance sheet.2 Other guarantees 2010 R’000 Bank guarantees to clients Bank guarantees to suppliers 36.5%). Current and deferred tax are measured at the tax rate applicable to undistributed income and therefore only takes STC into account to the extent that dividends have been received or paid. Net debt is calculated as total interest bearing liabilities less cash and cash equivalents. price and interest rate risk.

37.3 Analysis of financial assets and liabilities Financial assets GROUP: 2010 Facilities Management R’000 Financial asset classes Other investments Trade and other receivables Trade and other receivables – Mvela Group Cash and cash equivalents Treasury debtors Non-financial assets – 180 892 – 140 844 416 419 – 738 155 Financial asset categories Amortised cost Loans and receivables Other investments Trade receivables Trade and other receivables – Mvela Group Cash and cash equivalents Treasury debtors Non-financial assets 738 155 – 180 892 – 140 844 416 419 – 738 155 423 326 12 933 281 835 – 128 558 – – 423 326 180 588 – 165 141 – 15 447 – – 180 588 331 548 8 474 92 679 97 078 89 960 43 357 – 331 548 – – – – – – 1 066 576 1 066 576 1 673 617 21 407 720 547 97 078 374 809 459 776 1 066 576 2 740 193 12 933 281 835 – 128 558 – – 423 326 – 165 141 – 15 447 – – 180 588 8 474 92 679 97 078 89 960 43 357 – 331 548 – – – – – 1 066 576 1 066 576 21 407 720 547 97 078 374 809 459 776 1 066 576 2 740 193 Security Services R’000 Cleaning & Catering R’000 Diversified Services R’000 Non-financial Instruments R’000 Total R’000 Financial assets GROUP: 2009 Facilities Management R’000 Financial asset classes Other investments Trade and other receivables Trade and other receivables – Mvela Group Cash and cash equivalents Treasury debtors Non-financial assets 593 473 Financial asset categories Amortised cost Loans and receivables Other investments Trade receivables Trade and other receivables – Mvela Group Cash and cash equivalents Treasury debtors Non-financial assets 593 473 – 178 795 – 117 803 296 875 – 593 473 366 049 27 607 289 581 – 48 861 – – 366 049 161 250 875 110 227 – 26 808 23 341 – 161 251 235 051 9 520 78 824 97 078 16 779 32 850 – 235 051 – – – – – – 990 443 990 443 1 355 823 38 002 657 427 97 078 210 251 353 066 990 443 2 346 267 366 049 161 251 235 051 – 178 795 – 117 803 296 875 27 607 289 581 – 48 861 – 875 110 227 – 26 808 23 340 9 520 78 824 97 078 16 779 32 850 – – – – – 990 443 990 443 38 002 657 427 97 078 210 251 353 065 990 443 2 346 267 Security Services R’000 Cleaning & Catering R’000 Diversified Services R’000 Non-financial Instruments R’000 Total R’000 109 .

Financial assets GROUP: 2008 Facilities Management R’000 Financial asset classes Other investments Trade and other receivables Trade and other receivables – Mvela Group Cash and cash equivalents Treasury debtors Non-financial assets – 174 117 – 112 265 192 472 – 478 854 Financial asset categories Amortised cost Loans and receivables Other investments Trade and other receivables Trade and other receivables – Mvela Group Cash and cash equivalents Treasury debtors Non-financial assets 478 854 – 174 117 – 112 265 192 472 – 478 854 263 785 54 532 192 610 – 53 288 – – 300 430 147 717 2 129 87 976 – 38 412 19 200 – 147 717 243 011 6 953 87 877 105 950 15 185 18 046 – 234 011 – – – – – – 1 207 979 1 196 292 1 152 113 63 614 542 580 105 950 219 150 229 719 11 962 921 2 357 304 54 532 192 610 – 53 288 – – 300 430 2 129 87 976 – 38 412 19 200 – 147 718 6 953 87 877 105 950 15 185 18 046 – 234 011 – – – – – 1 196 292 1 196 292 63 614 542 580 105 950 219 150 229 718 1 196 292 2 357 304 Security Services R’000 Cleaning & Catering R’000 Diversified Services R’000 Non-financial Instruments R’000 Total R’000 Financial liabilities GROUP: 2010 Facilities Management R’000 Capital and reserves Non-current and current liabilities Fair value through profit and loss Loans at amortised cost Interest bearing liabilities Asset finance Other loans Other loans – Mvela Group Treasury creditors Non-interest bearing liabilities Other loans Other loans – Mvela Group Trade and other payables Non-financial instruments – 274 439 – – – – – 374 873 164 394 – – 96 232 – 128 488 14 807 – – 32 980 36 900 1 367 967 21 853 482 506 100 478 – – 20 546 – – – – 36 900 2 166 319 201 054 482 506 100 478 129 212 – Security Services R’000 – Cleaning & Catering R’000 – Diversified Services R’000 – Non-financial Instruments R’000 233 300 Total R’000 233 300 – – 274 439 – 274 439 – – 114 253 – 374 879 – – 80 701 – 128 488 – 722 117 41 013 – 1 404 866 20 546 – – 297 132 550 978 20 546 722 117 510 406 297 132 2 733 651 110 .

No gain or loss has been recognised in the income statement as a result of a change in the Group’s credit spread.4 Credit risk Credit and counterparty risk refers to the effects on future cash flows and earnings of borrowers defaulting on their obligations. 37. options or other forms of investment. In addition to the 111 . This risk primarily arises through investing activities and trade receivables arising from subsidiaries. Significant cash deposits are placed with investment grade banks and the Group’s central treasury monitors the exposure to any one financial institution by adherence to board defined counterparty limits. the exposure is considered to be part of the investment and is initially evaluated and monitored based on the investment as a whole which may incorporate equities. Management has evaluated this assumption and determined that no adjustment is necessary in the current year. The valuation method utilised is based on the constant credit spread approach. Where a credit exposure arises as part of a strategic equity investment.Financial liabilities GROUP: 2009 Facilities Management R’000 Capital and reserves Non-current and current liabilities Fair value through profit and loss Loans at amortised cost Interest bearing liabilities Asset finance Other loans Other loans – Mvela Group Treasury creditors Non-interest bearing liabilities Other loans Other loans – Mvela Group Trade and other payables Non-financial instruments Total – Security Services R’000 – Cleaning & Catering R’000 – Diversified Services R’000 – Non-financial Instruments R’000 78 898 Total R’000 78 898 – 257 239 – – – – – 357 584 107 765 – – 143 611 – 133 000 16 976 – – 16 386 34 199 1 211 491 25 624 482 438 101 959 – – 263 735 – – – – 34 199 2 223 049 150 365 482 438 101 959 159 997 – – 257 239 – 257 239 – – 106 208 – 357 585 – – 99 638 – 133 000 – 557 963 43 507 – 1 245 690 22 324 – 241 411 10 120 352 754 22 324 557 963 748 003 10 120 2 346 266 Financial liabilities GROUP: 2008 Facilities Management R’000 Capital and reserves Non-current and current liabilities Loans at amortised cost Interest bearing liabilities Asset finance Other loans Other loans – Mvela Group Treasury creditors Non-interest bearing liabilities Other loans Other loans – Mvela Group Trade and other payables Non-financial instruments Total 252 390 – – – – 287 711 82 929 – – 123 749 117 748 15 468 – – 13 944 1 246 897 127 089 – 74 397 66 491 1 401 – – – – 1 906 143 225 486 – 74 397 204 184 – Security Services R’000 – Cleaning & Catering R’000 – Diversified Services R’000 – Non-financial Instruments R’000 90 054 Total R’000 90 054 – – 252 390 – 252 390 – – 81 033 – 287 711 – – 88 336 – 117 748 – 848 870 130 050 – 1 246 897 1 401 – – 361 103 452 558 1 401 848 870 551 809 361 103 2 357 304 The fair value of the financial assets and liabilities carried at amortised cost is approximately equal to their carrying amounts.

Each subsidiary is responsible for the evaluation of customers prior to the granting of credit as each subsidiary has a unique customer base and differing levels of exposure. the Group also manages the exposure by limiting the duration of the amounts placed on deposit. remedial action is taken to recover the debt. the continuation of the service is cancelled until full repayment has been received. Where the behaviour falls outside of an acceptable range. Trade receivables in most instances consist of a large number of customers.concentration risk arising from amounts placed on deposit. Analysis of credit quality GROUP: 2010 Facilities Management Credit quality analysis (high/medium/low) Financial assets that are neither past due nor impaired Trade and other receivables Cash and cash equivalents Treasury debtors Financial assets that are past due but not yet impaired (per age analysis) 0 – 30 days 31 – 60 days 61 – 90 days > 90 days Financial assets that would otherwise be impaired whose terms have been renegotiated Financial assets that are impaired Carrying amount Provision for Impairment Total credit exposure Medium R’000 725 827 168 564 140 844 416 419 11 789 – 3 214 1 896 6 679 – 540 4 396 3 856 738 156 Security Cleaning Services & Catering Receivables Medium Medium R’000 R’000 289 564 161 007 128 558 – 100 976 20 599 12 682 11 574 56 121 96 19 756 56 260 36 504 410 392 119 567 104 120 15 447 – 46 848 16 688 (374) 15 685 14 849 – 14 173 28 074 13 901 180 588 Diversified Services Medium R’000 299 952 166 608 89 960 43 357 22 396 431 18 096 2 996 873 355 395 704 309 323 071 Total R’000 1 434 884 600 298 374 809 459 777 182 011 37 719 33 618 32 151 78 522 452 34 864 89 433 54 569 1 652 210 Analysis of credit quality GROUP: 2009 Facilities Management Credit quality analysis (high/medium/low) Financial assets that are neither past due nor impaired Trade and other receivables Cash and cash equivalents Treasury debtors Financial assets that are past due but not yet impaired (per age analysis) 0 – 30 days 31 – 60 days 61 – 90 days > 90 days Financial assets that would otherwise be impaired whose terms have been renegotiated Financial assets that are impaired Carrying amount Provision for Impairment Total credit exposure Medium R’000 591 426 176 748 117 803 296 875 865 369 63 19 414 – 1 184 9 713 (8 529) 593 475 Security Cleaning Services & Catering Receivables Medium Medium R’000 R’000 174 290 125 429 48 861 – 108 516 37 522 17 705 15 882 37 407 1 599 54 038 77 513 (23 475) 338 448 90 764 40 615 26 808 23 341 57 323 46 897 6 089 2 217 2 120 – 12 289 22 159 (9 870) 160 376 Diversified Services Medium R’000 197 711 148 082 16 779 32 850 23 986 132 13 563 9 357 934 968 2 866 5 094 (2 228) 225 531 Total R’000 1 054 191 490 874 210 251 353 066 190 690 84 920 37 420 27 475 40 875 2 567 70 377 114 479 (44 102) 1 317 825 112 . Credit exposures are managed through prudent credit limits and constant evaluation of repayment behaviour. The Group very rarely renegotiates the terms of a loan agreement and where this is considered necessary the exposure remains classified as either past. Where services are provided. due or impaired. spread across diverse industries and geographical areas.

113 . This exposure is monitored relative to the investments and where considered necessary management may hedge the exposure to interest rate risk either through fixed rate funding or interest rate derivatives. interest rate risk and currency risk.5. Given the nature of the risk no additional collateral is taken against the credit risk exposures except for credit guarantee insurance. The Group is exposed to three primary types of market risk namely equity risk. exchange rates or interest rates. policies and procedures relating to each type of market risk. 37.5 Market risk Market risk is the potential change in the value of a financial instrument resulting from changes in market conditions or market parameters such as equity prices. The specific risk management objectives. Facilities Management R’000 3 292 (1 338) 1 954 6 576 – 8 530 (4 674) – 3 856 Security Cleaning Services & Catering R’000 R’000 10 563 21 155 31 718 (8 243) – 23 475 13 029 – 36 504 3 010 541 3 551 6 320 – 9 871 4 031 – 13 902 Diversified Services R’000 1 807 1 867 3 674 (698) (749) 2 227 (1 919) – 308 Total R’000 18 672 22 225 40 897 3 955 (749) 44 103 10 467 – 54 570 Reconciliation of allowance account At 30 June 2007 Current year charge net of recoveries At 30 June 2008 Current year charge net of recoveries Disposals of subsidiaries At 30 June 2009 Current year charge net of recoveries Acquisition/Disposals of subsidiaries At 30 June 2010 37.1 Interest rate risk management Interest rate risk refers to the impact on future cash flows and earnings of assets and liabilities of interest rates re-pricing either at different points in time or on a different basis. the maximum exposure to credit risk is the carrying value of the financial assets.Analysis of credit quality GROUP: 2008 Facilities Management Credit quality analysis (high/medium/low) Medium R’000 477 780 173 043 112 265 192 472 808 214 279 – 315 266 8 123 (7 857) 478 854 Security Cleaning Services & Catering Receivables Medium R’000 170 658 154 015 16 643 – 81 914 24 351 11 650 12 076 33 837 11 212 39 397 (28 185) 263 784 Medium R’000 84 988 27 375 38 412 19 201 47 913 41 232 4 145 1 122 1 414 14 817 15 996 (1 179) 147 718 Medium R’000 152 197 91 220 42 931 18 046 106 842 48 014 39 201 12 792 6 835 2 717 6 392 (3 675) 261 756 Total R’000 885 622 445 653 210 251 229 719 237 477 113 811 55 275 25 990 42 401 29 012 69 908 (40 896) 1 152 112 Diversified Services Financial assets that are neither past due nor impaired Trade and other receivables Cash and cash equivalents Treasury debtors Financial assets that are past due but not yet impaired (per age analysis) 0 – 30 days 31 – 60 days 61 – 90 days > 90 days Financial assets that are impaired Carrying amount Provision for Impairment Total credit exposure Unless otherwise indicated. is described in the sections below. The Group itself is not exposed to a significant amount of interest rate risk relative to its exposure to equity risk and therefore the majority of the funding and asset profile is at variable interest rates. where considered appropriate.

GROUP: 2010 Carrying value exposed to market risk R’000 374 809 21 407 396 216 201 054 241 219 241 219 34 199 717 691 Prime Prime Prime JIBAR 3 3 3 3 Index to which interest rate is linked R’000 Prime Prime Carrying value at year end R’000 Financial assets Cash and cash equivalents Other Investments 374 809 21 407 396 216 Financial liabilities Asset-based finance Preference shares issued to United Towers Preference shares issued to Depfin Financial liability – derivative financial instrument 201 054 241 219 241 219 36 900 720 392 Reasonably possible change % 3 3 Income statement impact Pre-tax Tax effect R’000 R’000 11 244 642 11 886 6 032 7 237 7 237 1 026 21 532 3 148 180 3 328 1 689 2 026 2 026 287 6 028 GROUP: 2009 Carrying value exposed to market risk R’000 210 251 38 002 248 253 150 365 241 219 241 219 34 199 667 002 Prime Prime Prime JIBAR 3 3 3 3 Index to which interest rate is linked R’000 Prime Prime Carrying value at year end R’000 Financial assets Cash and cash equivalents Other Investments 210 251 38 002 248 253 Financial liabilities Asset-based finance Preference shares issued to United Towers Preference shares issued to Depfin Financial liability – derivative financial instrument 150 365 241 219 241 219 34 199 667 002 Reasonably possible change % 3 3 Income statement impact Pre-tax Tax effect R’000 R’000 6 308 1 140 7 448 4 511 7 237 7 237 1 026 20 011 1 766 319 2 085 1 263 2 026 2 026 287 5 602 GROUP: 2008 Carrying value exposed to market risk R’000 219 150 63 614 3 242 286 006 225 486 Prime 1 Index to which interest rate is linked R’000 Prime Prime JIBAR Carrying value at year end R’000 Financial assets Cash and cash equivalents Other investments Financial asset 219 150 63 614 3 242 286 006 Financial liabilities Asset-based finance 225 486 Reasonably possible change % 1 1 1 Income statement impact Pre-tax Tax effect R’000 R’000 2 192 636 32 2 860 2 255 614 178 9 801 1 624 114 .

The Group has very limited exposure to foreign exchange rate risk. No division is allowed to invest excess cash for themselves. The liquidity risk refers to the ability of the Group to meet its financial obligations as they fall due. foreign exchange contracts may be taken out to hedge the risk. Each operating division is responsible for the management of short-term cash flows but are incentivised to place excess cash on deposit with the treasury on a daily basis. funds management and trading operations.00 1 826 GROUP: 2009 Carrying value exposed to market risk Index to which interest rate is linked Carrying value at year end Financial assets Cash and cash equivalents Cash and cash equivalents Reasonably possible change % 10.6 Foreign exchange rate risk management Foreign exchange rate risk is the risk that the fair value or future cash flows of a financial instrument will fluctuate because of changes in foreign exchange rates. The risk arises in limited circumstances within some of the operating divisions.37.00 10. Management determines the need for cover based on a case by case basis after considering factors such as size and duration of exposure. there were no financial assets or liabilities that were subject to foreign exchange rate risk. GROUP: 2010 Carrying value exposed to market risk Index to which interest rate is linked Carrying value at year end Financial assets Cash and cash equivalents Cash and cash equivalents (R’000) Reasonably possible change % 10. The Group has significant cash reserves and therefore rarely uses overdraft facilities except for short-term operational reasons.00 2 614 2 614 For 30 June 2008. management monitors the exposure on an individual basis. The treasury monitors the position through the use of daily. These cash flow analyses are used to determine the appropriate cash investment strategy.00 Income statement impact Pre-tax Tax effect R’000 R’000 776 63 839 217 18 235 511 7 763 632 8 395 7 763 632 8 395 18 260 USD Other Financial liabilities Deposit received in advance 18 260 USD 10. weekly and a rolling monthly liquidity analyses. The Group has a central treasury that is responsible for monitoring the liquidity position and ensuring that the Group is able to meet its’ contractual obligations. In the limited instances where the risk cannot be transferred to the customer. When the risk does arise.7 Liquidity Liquidity risk arises in the general funding of the Group’s activities when there are mismatches between the sizes and maturities of assets and liabilities and also in its strategic investments. 37.00 10. In most instances the risk is passed directly back to the customer. The Group has access to approved banking facilities of R62 million (2008: R62 million) 115 .00 Income statement impact Pre-tax Tax effect R’000 R’000 5 415 681 6 096 1 516 191 1 707 732 732 54 151 6 812 60 963 54 151 6 812 60 963 26 144 26 144 USD Other Financial liabilities Deposit received in advance 26 144 26 144 USD 10.

The Group’s contributions to all retirement funds are charged against income when incurred. RETIREMENT BENEFITS Approximately 85% (2009: 80%) of the Group’s employees are members of various pension and provident funds. a defined-contribution fund which is governed by the Pension Funds Act. These funds include the parent to the Group. 24 of 1956. EVENTS SUBSEQUENT TO THE BALANCE SHEET DATE There have been no events between 30 June 2010 and the date of these financial statements which necessitate adjustment to the income statement or balance sheet at that date. 39.GROUP: 2010 Carrying value at 30 June 2010 R’000 Asset-based finance Investment funding Preference shares issued to Absa Capital Preference shares issued to Nedbank Financial liability – derivative financial instrument Other liabilities Trade and other payables 201 054 Greater than 3 years R’000 20 300 0 to 3 months R’000 20 093 4 to 6 months R’000 19 803 7 to 12 months R’000 38 127 1 to 2 years R’000 58 967 2 to 3 years R’000 43 765 Total R’000 201 054 241 219 241 219 36 900 510 406 1 230 798 – – – 510 406 530 499 – – – – 19 803 – – – – 38 127 68 303 68 303 – – 195 573 123 270 123 270 – – 290 304 125 941 125 941 36 900 – 317 514 317 514 36 900 510 406 309 082 1 383 388 GROUP: 2009 Carrying value at 30 June 2009 R’000 Asset-based finance Investment funding Preference shares issued to United Towers Preference shares issued to Depfin Financial liability – derivative financial instrument Other liabilities Trade and other payables 150 365 Greater than 3 years R’000 13 361 0 to 3 months R’000 17 616 4 to 6 months R’000 17 497 7 to 12 months R’000 32 701 1 to 2 years R’000 53 275 2 to 3 years R’000 24 291 Total R’000 158 741 241 219 241 219 34 199 748 003 1 415 005 – – – 748 003 765 619 – – – – 17 497 – – – – 32 701 68 303 68 303 – – 189 881 123 270 123 270 – – 270 831 125 941 125 941 34 199 – 317 514 317 514 34 199 748 003 299 442 1 575 971 GROUP: 2008 Carrying value at 30 June 2008 R’000 Asset-based finance Other liabilities Trade and other payables 225 486 551 809 777 295 Greater than 3 years R’000 30 291 – 30 291 0 to 3 months R’000 38 015 551 809 589 824 4 to 6 months R’000 36 960 – 36 960 7 to 12 months R’000 52 509 – 52 509 1 to 2 years R’000 85 066 – 85 066 2 to 3 years R’000 33 022 – 33 022 Total R’000 275 863 551 809 827 672 38. and defined-contribution funds for the industries in which the Group employees work. The Group contributed R93 278 000 (2008: R72 974 000) to defined-contribution plans during the year. 116 . No. various independently administered defined-contribution funds of the operating companies. Mvelaphanda Group Provident Fund.

2009 AND 2008 Introduction At your request and for the purposes of the Pre-listing Statement to be dated on or about 27 October 2010 (“the Pre-listing Statement”).Those standards require that we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance whether the financial statements are free from material misstatement.ANNEXURE 3 REPORTING ACCOUNTANTS’ REPORT ON THE HISTORICAL FINANCIAL INFORMATION OF MVELASERVE AND ITS SUBSIDIARIES The Directors Mvelaphanda Group Limited 1st Floor 30 Melrose Boulevard Melrose Arch Johannesburg 21 October 2010 INDEPENDENT REPORTING ACCOUNTANTS’ REPORT ON THE AUDITED HISTORICAL FINANCIAL INFORMATION OF MVELASERVE LIMITED (“MVELASERVE”) FOR THE YEARS ENDED 30 JUNE 2010. included in the Pre-listing Statement. 2009 and 2008 in compliance with the JSE Limited Listings Requirements. 117 . Scope of the audit We conducted our audit of the historical financial information for the year ended 30 June 2010 in accordance with International Standards on Auditing. selecting and applying appropriate accounting policies. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial information. based on our audit of the financial information for the year ended 30 June 2010 and our review of the financial information for the years ended 30 June 2009 and 2008. contents and presentation of the Pre-listing Statement and the fair presentation of the historical financial information in accordance International Financial Reporting Standards. but not for the purpose of expressing an opinion on the effectiveness of the entity’s internal control.The procedures selected depend on the auditor’s judgment. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by management. the auditor considers internal control relevant to the entity’s preparation and fair presentation of the financial information in order to design audit procedures that are appropriate in the circumstances. we present our report on the historical financial information of Mvelaserve for the years ended 30 June 2010. Responsibilities Management’s Responsibility for the Financial Statements Management is responsible for the preparation. and making accounting estimates that are reasonable in the circumstances. This responsibility includes: designing. implementing and maintaining internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement. whether due to fraud or error. In making those risk assessments. as well as evaluating the overall presentation of the financial information. 2009 and 2008. Reporting Accountants’ Responsibility Our responsibility is to express an opinion on the historical financial information of Mvelaserve for the years ended 30 June 2010. whether due to fraud or error. including the assessment of the risks of material misstatement of the financial information.

Audit opinion In our opinion, the historical financial information of Mvelaserve for the year ended 30 June 2010 fairly presents, in all material respects, for the purposes of the Pre-listing Statement, the financial position of Mvelaserve at that date and the results of its operations and cash flows for the period then ended in accordance with International Financial Reporting Standards and in the manner required by the Companies Act, 61 of 1973, and the JSE Limited Listings Requirements. Scope of the review We conducted our review of the historical financial information for the years ended 30 June 2009 and 2008 in accordance with the International Standards on Review Engagements 2400, “Engagements to review financial statements”. This standard requires that we plan and perform the review to obtain moderate assurance as to whether the historical financial information is free of material misstatement. A review is limited primarily to enquiries of company personnel and analytical procedures applied to financial data and thus provides less assurance than an audit. We have not performed an audit in respect of the years ended 30 June 2009 and 2008 and, accordingly, we do not express an audit opinion in respect of these periods. Review conclusion Based on our review nothing has come to our attention that causes us to believe that the historical financial information of Mvelaserve for the years ended 30 June 2009 and 2008 is not fairly presented, in all material respects, for the purposes of the Pre-listing Statement, in accordance with International Financial Reporting Standards and in the manner required by the Companies Act, 61 of 1973, and the JSE Limited Listings Requirements. Consent We consent to the inclusion of this report and the reference to our opinion in the circular in the form and context in which it appears. Yours faithfully PKF (Jhb) Inc Paul Badrick Registration number 1994/001166/21 Registered Auditors Chartered Accountants (SA) 42 Wierda Road West Wierda Valley Sandton 2196

118

ANNEXURE 4

UNAUDITED PRO FORMA STATEMENT OF COMPREHENSIVE INCOME AND STATEMENT OF FINANCIAL POSITION OF MVELASERVE

The unaudited pro forma financial information is the responsibility of the Directors of Mvelaserve and has been prepared for illustrative purposes only. Due to its nature, the unaudited pro forma financial information may not fairly present Mvelaserve’s consolidated financial position, or results of operations. The unaudited pro forma financial information has been prepared to illustrate the impact of the Zonke acquisition, the Debt Restructure, Unbundling and Listing for the financial year ended 30 June 2010 had the Debt Restructure and Unbundling and Listing occurred on 1 July 2009 for statement of comprehensive income purposes and on 30 June 2010 for statement of financial position purposes. No adjustments have been made to the pro forma financial information in respect of post balance sheet events except as provided for in IFRS on Events After Balance Sheet or in respect of the particular corporate action for which the pro forma financial information is presented or in respect of any post balance sheet corporate action where it would be misleading not to make an adjustment.

119

MVELASERVE LIMITED Summarised Group Statement of Comprehensive Income 30 June 2010 Before
(1)

Share split
(2)

Zonke Debt Listing and acquisition Restructure Unbundling
(2); (5); (6) (2); (7); (8); (9) (2); (10)

After R’000 4 111 948

R’000 Revenue Profit from operations Interest income – third party Interest treasury Interest expense – third party Share of profit from associates Net fair value adjustments and profit from investments Profit before taxation Taxation expense Profit for the year from continuing operations Profit for the year from discontinued operations Total comprehensive income for the year Total comprehensive income attributable to: Owners of the parent Other shareholders Weighted average net number of ordinary shares in issue Diluted weighted average net number of ordinary shares in issue Earnings per Ordinary Share Headline earnings per Ordinary Share Diluted earnings per Ordinary Share Diluted headline earnings per Ordinary Share 4 061 998 291 287 14 888 2 561 (77 943) 6 075 (2 726) 234 142 (80 282) 153 860 1 155 155 015

R’000 49 950 19 858 5 (1)

R’000

R’000

(13 946) (22 453)

(58 985)(10c;d) 260 160 947 (2 561)(10b) – (100 397) 6 075 (2 726)

19 862 (6 137) 13 725

(36 399) 15 603 (20 796)

(53 546) 164 059 13 314(10b;d) (57 502) (40 232) 106 557 1 155

13 725

(20 796)

40 232

107 712

151 798 3 217

10 294 3 431

(20 796)

40 232

101 064 6 648

100

79 455 900

6 850 937

55 254 736 141 561 673

100 1 517 980 1 514 127 1 517 980 1 514 127

79 455 900(4) 1.9 1.9 1.9 1.9

6 850 937(4)

55 254 736(4) 141 561 673 0.71 0.71 0.71 0.71

Reconciliation between net profit attributable to ordinary shareholders and headline net profit attributable to ordinary shareholders: Before R’000 Net profit attributable to ordinary shareholders Profit on disposal of property, plant and equipment (net of tax) Profit on disposal of intangible assets Headline net profit attributable to ordinary shareholders 151 798 (340) (46) 151 413 After R’000 101 064 (340) (46) 100 678

120

22) 6 850 937 55 254 736 141 561 673 5. (6) Debt Restructure (3).82 121 .MVELASERVE LIMITED Summarised Group Statement of Financial Position 30 June 2010 Before (1) Share split (3) Zonke acquisition (3). (10) After R’000 R’000 ASSETS Non-current assets Property. (7) Listing and Unbundling (3). (5).05 0. plant and equipment Intangible assets Investments in associates Other investments Deferred taxation Current assets Other investments Inventories Trade and other receivables Trade and other receivables – Mvela Group Cash and cash equivalents Treasury receivable Assets in disposal group held for sale Total assets EQUITY AND LIABILITIES Capital and reserves Shareholder’s equity Minority interest Non-current liabilities Interest bearing liabilities – preference share funding Interest bearing liabilities – Nedbank debt Asset finance Non-interest bearing liabilities Mvela Group Financial liabilities Deferred taxation Current liabilities Trade and other payables Interest bearing liabilities Mvela Group Asset finance Non-interest bearing liabilities Taxation liabilities Treasury creditors Liabilities in disposal group held for sale Total equity and liabilities Net number of ordinary shares in issue Net asset value per ordinary share Net tangible asset value per ordinary share 233 300 227 817 5 483 1 367 158 482 438 123 032 722 117 36 900 2 671 1 133 193 793 736 100 478 78 022 18 136 13 609 129 212 – 2 733 651 (4) R’000 R’000 R’000 975 105 387 619 545 335 8 269 16 362 17 520 1 753 501 15 553 41 608 763 876 97 878 374 809 459 777 5 045 2 733 651 36 021 821 35 014 186 5 785 5 529 (133 492) (490 048) 1 011 126 388 440 580 349 8 269 16 362 17 706 1 135 746 21 082 41 608 763 876 (133 492) (97 878) 67 607 (459 777) – 309 180 – 5 045 256 41 806 (133 492) (490 048) 2 151 917 37 707 31 120 6 587 (55 470) (482 438) 550 000 (123 032) 455 804 455 804 – (722 117) 726 811 714 741 12 070 589 571 550 000 (722 117) 36 900 2 671 4 099 4 099 (78 022) (223 735) 5 955 (100 478) 835 535 803 790 – – 18 136 13 609 – – (78 022) (129 212) 41 806 (4) (133 492) (490 048) (4) 2 151 917 100 2 278 170 (3 350 380) 79 455 900 2.87 (4.

the Debt Restructure and the Listing and Unbundling were implemented on 30 June 2010. consisting of 1 000 ordinary shares of R1 each. The following alterations to share capital. 11. The total value of the premium was R80 999 138. The pro forma adjustments to the statement of financial position have been calculated on the assumption that the Zonke acquisition.Notes and assumptions: 1.00012585581957 each. 122 .00012585581957 each. consisting of 794 560 000 ordinary shares of R0. The pro forma adjustments to the statement of comprehensive income have been calculated on the assumption that the Zonke acquisition. The transactions relating to the Listing and Unbundling involve the following: a) b) c) d) the net settlement of inter-company loans between Mvelaserve and Mvela Group in the statement of financial position. Mvelaserve converted its entire authorised and issued share capital from ordinary shares with a par value of R0. In terms of the Debt Restructure. consisting of 100 ordinary share of R1 each. which are non-deductible for income tax purposes have been expensed to the statement of comprehensive income. have been assumed to have taken place on 30 June 2010 in the statement of financial position and on 1 July 2009 in the statement of comprehensive income: • Mvelaserve altered each share in the entire authorised capital of R1 000.00012585581957 each. R200 million of the Nedbank debt has been applied to settle the Group’s asset-backed borrowings. net interest paid by Mvela Group on inter-company loan accounts with Mvelaserve and Zonke have been reversed in the statement of comprehensive income. except for the adjustments detailed in notes 10(c) and 10(d). being R550 million.00012585581957 each. together with R230 million cash on hand. The remaining balance of R100 million being placed on call. as disclosed in paragraph 63. 9. consisting of 79 456 000 ordinary shares of R0. 7. thus increasing the authorised number of shares to capital of R1 000. 2. 8. In the statement of comprehensive income all adjustments are considered to have a continuing effect.00012585581957 each. Interest paid on the Nedbank debt has been calculated in accordance with the Nedbank debt agreement. The Mvelaserve financial information reflected in the “Before” column has been extracted from the audited annual results of Mvelaserve for the year ended 30 June 2010. was paid to Directors and senior managers of Mvelaserve and its subsidiaries and is considered deductible for income tax purposes. and • 5. 10. and the issued ordinary share capital of R100. • • • 6 850 937 Mvelaserve Ordinary Shares were issued as consideration for the Zonke acquisition from Mvela Group. No goodwill will arise on the acquisition of Zonke by Mvelaserve from Mvela Group as the acquisition takes place between Group companies. 55 254 736 Mvelaserve Ordinary Shares were issued to Mvela Group and the subscription price of R653 287 804 therefore was applied by Mvelaserve in the net settlement of the inter-company loans between Mvelaserve and Mvela Group. it has been assumed that Mvelaserve will draw down on the maximum facility relating to the Nedbank debt. Interest paid on the R250 million facility used to repay the preference shares has not been deducted for taxation purposes. 4. Mvelaserve cancelled 294 560 000 ordinary shares in the authorised share capital of Mvelaserve. which occurred on or about 7 October 2010. 3. by implementing a share split of each share of R1 each into 794 560 ordinary shares of R0. R250 million of which. The dividends paid on the preference shares have been reversed in the statement of comprehensive income. The Zonke financial information has been derived from the audited financial information of Zonke for the financial year ended 30 June 2010. the Debt Restructure and the Listing and Unbundling were implemented on 1 July 2009. and a retention bonus as explained in paragraph 18 of this Pre-Listing Statement. transaction costs of R6 million. These new Mvelaserve Ordinary Shares will form part of the Unbundling and have been taken into account when calculating the entitlement ratio. Interest received has not been earned on this excess cash. and the issued ordinary share capital of R100. Mvela Group sold its 75% interest in Zonke for R81 000 000 which was settled through the issue of 6 850 937 new Mvelaserve Ordinary Shares to Mvela Group. has been used to repay the preference share funding. to the value of R81 000 000. 6. such that the total authorised share capital consisted of 500 000 000 ordinary shares of R0. to ordinary shares with no par value.

Directors’ responsibility The Directors are responsible for the compilation. • the basis is consistent with the accounting policies of Mvelaserve. Debt Restructure.Terms used herein and defined in the Pre-listing Statement have the meaning assigned to them in the Pre-listing Statement unless otherwise indicated. had the corporate actions been undertaken at the commencement of the period or at the date of the pro forma statement of financial position being reported on. might have affected the reported historical financial information presented. 123 . contents and presentation of the pro forma financial information contained in the Pre-listing Statement and for the financial information from which it has been prepared. We do not accept any responsibility for any reports previously given by us on any financial information used in the compilation of the pro forma financial information. Their responsibility includes determining that: • the pro forma financial information has been properly compiled on the basis stated. Listing and Unbundling. being the Zonke acquisition. beyond that owed to those to whom those reports were addressed by us at the dates of their issue.ANNEXURE 5 INDEPENDENT REPORTING ACCOUNTANTS’ REPORT ON THE UNAUDITED PRO FORMA STATEMENT OF COMPREHENSIVE INCOME AND STATEMENT OF FINANCIAL POSITION OF MVELASERVE The Directors Mvelaserve Limited 28 Eddington Crescent Highveld Technopark Centurion 0169 21 October 2010 Dear Sirs INDEPENDENT REPORTING ACCOUNTANTS’ LIMITED ASSURANCE REPORT ON THE PRO FORMA FINANCIAL INFORMATION OF MVELASERVE LIMITED (“MVELASERVE”) We have performed our limited assurance engagement in respect of the pro forma financial information set out in Annexure 4 to the Pre-listing Statement to shareholders of Mvelaserve to be dated on or about 27 October 2010 (“the Pre-listing Statement”). for illustrative purposes only. The pro forma financial information has been prepared in accordance with the requirements of the JSE Limited (“the JSE”) Listings Requirements. • the pro forma adjustments are appropriate for the purposes of the pro forma financial information disclosed in terms of the Listings Requirements. to provide information about how the corporate actions. We conducted our assurance engagement in accordance with the International Standard on Assurance Engagements applicable to Assurance Engagements Other Than Audits or Reviews of Historical Financial Information and the Guide on Pro Forma Financial Information issued by The South African Institute of Chartered Accountants. Reporting accountants’ responsibility Our responsibility is to express our limited assurance conclusion on the pro forma financial information included in the Pre-listing statement to the Mvelaserve shareholders. This standard requires us to obtain sufficient appropriate evidence on which to base our conclusion.

In a limited assurance engagement the evidence-gathering procedures are more limited than for a reasonable assurance engagement and therefore less assurance is obtained than in a reasonable assurance engagement. Conclusion Based on our examination of the evidence obtained. in the form and context in which they appear. Yours faithfully PKF (Jhb) Inc Duncan Church Registration number 1994/001166/21 Registered Auditors Chartered Accountants (SA) 42 Wierda Road West Wierda Valley Sandton 124 . • the adjustments are not appropriate for the purposes of the pro forma financial information as disclosed. and discussing the adjusted pro forma financial information with the Directors and management of the company in respect of the corporate action that is the subject of this Pre-listing Statement. and other information provided to us. nothing has come to our attention. In arriving at our conclusion.17 and 8. We believe our evidence obtained is sufficient and appropriate to provide a basis for our conclusion. considering the pro forma adjustments in light of the accounting policies of Mvelaserve. our assurance engagement does not constitute an audit or review of any of the underlying financial information conducted in accordance with International Standards on Auditing and accordingly. While our work performed has involved an analysis of the historical published audited financial information. Consent This report on the pro forma financial information is included solely for the information of the Mvelaserve shareholders. considering the evidence supporting the pro forma adjustments.Sources of information and work performed Our procedures consisted primarily of comparing the unadjusted financial information with the source documents. • such basis is inconsistent with the accounting policies of Mvelaserve. financial and industry sources. we have relied upon financial information prepared by the Directors and management of Mvelaserve and other information from various public. which causes us to believe that in terms of Sections 8. We consent to the inclusion of our report on the pro forma financial information and the references thereto.30 of the JSE Listings Requirements: • the pro forma financial information has not been properly compiled on the basis stated. we do not express an audit or review opinion.

2076 28 Eddington Crescent. 1459 6 Cowie Road. Aeroport Park. 30 Melrose Boulevard. Centurion. 2076 7 Sweetgum Crescent. Fourways Gardens. 1685 49 Director Road. Morningside. 2055 38 Centre Road. Forest Town. Freeway Park. Fourways. Senior management Set out below are the details of the senior management of Mvelaserve: Occupation and/or function within Mvelaserve Business Development Executive Chief Executive Officer – TFMC Chief Executive Officer – Khuseti Acting Chief Executive Officer – Contract Forwarding Names and nationality M J Schermers South African B E Spence Centurion. Melrose Arch. Centurion. Midrand. the Audit and Risk Committee has satisfied itself of the appropriateness of the expertise and experience of the Chief Financial Officer. Spartan Ext 2. 1685 9 Steenveld Road. Highveld Technopark. 30 Melrose Boulevard.ANNEXURE 6 PARTICULARS AND REMUNERATION OF THE DIRECTORS AND SENIOR MANAGEMENT OF MVELASERVE OCCUPATIONS AND/OR FUNCTIONS PERFORMED BY DIRECTORS AND SENIOR MANAGEMENT Directors Set out below are the details of the Directors of Mvelaserve as at the Listing Date: Occupation and/or function within Mvelaserve Executive Chairman * Chief Executive Officer Chief Financial Officer Independent Non-Executive Director * Independent Non-Executive Director * Independent Non-Executive Director * Independent Non-Executive Director * Independent Non-Executive Director * Names and nationality M S M Xayiya South African J M S Ferreira South African G E Röth South African O A Mabandla South African S Masinga South African N Mbalula South African F N Mantashe South African G D Harlow South African Business address 1st Floor. Kempton Park. Johannesburg. Midstream. corner West and Lenchen Avenues. 1620 125 . 2193 As at the Listing Date. 807 Richards Drive. Boksburg. Eastside Corporate Close. 0169 The Meersig Building. * Appointed as Directors of Mvelaserve with effect from the Listing date. Johannesburg. 0169 1st Floor. 14 Crystal Court. 0046 South African C R Waterson South African D Kynaston South African Business address 28 Eddington Crescent. G E Röth. Midstream Estate. 2057 21 Medborn Street. Highveld Technopark. Melrose Arch. Johannesburg.

Post the Listing. will become the Chief Financial Officer of Mvelaserve effective upon the Listing.Names and nationality M H Malope South African P A van Niekerk South African T D Pitikoe South African Business address 3rd Floor. 160 Jan Smuts Avenue. Highveld Technopark. Rosebank. The material terms of the service agreements with the Executive Directors and senior management are set out below: Date of appointment to current role 1 July 2009 Note 1 Name J M S Ferreira G E Röth M J Schemers2 B E Spence C R Waterson D Kynaston M H Malope P A van Niekerk T D Pitikoe Notes: Position Chief Executive Officer Chief Financial Officer Business Development Executive Chief Executive Officer – TFMC Chief Executive Officer – Khuseti Acting Chief Executive Officer – Contract Forwarding Chief Executive Officer – Zonke Chief Executive Officer – Protea Coin Chief Executive Officer – Royalserve Notice period service per agreement 90 days Note 1 Restraint None Note 1 29 July 2009 1 April 2010 1 November 2009 21 October 2009 13 December 2007 1 March 2009 1 July 2008 90 days 90 days 90 days 90 days 90 days 90 days 90 days None None None None 12 months3 18 months3 None 1. 0169 Occupation and/or function within Mvelaserve Chief Executive Officer – Zonke Chief Executive Officer – Protea Coin Chief Executive Officer – Royalserve No activities are performed by the senior management of Mvelaserve outside of Mvelaserve that are significant to Mvelaserve. who at the date of this Pre-listing Statement was the Chief Financial Officer of Mvela Group. Remuneration for Directors and senior management indicated above as a Group totalled R17 million for the financial year ended 30 June 2010. As at the date of this Pre-listing Statement. 126 . M J Schermers was appointed as Financial Director and will resign from this position as at the Listing Date and assume the role of Business Development Executive. G E Röth. 2. CONTRACTS RELATING TO DIRECTORS AND MANAGERIAL REMUNERATION Each of the Executive Directors and the senior management of Mvelaserve have a standard service agreement with Mvelaserve. 3. Centurion. The existing remuneration package of the Directors and senior management will be reviewed in line with those of a listed company by the Remuneration and Nomination Committee and adjusted if necessary. 0169 28 Eddington Crescent. No remuneration was paid or is payable in terms of the restraint. if and when required. Centurion. and upon the appointment of G E Röth as the Chief Financial Officer of Mvelaserve. a service agreement will be entered into. 2196 22 Witchhazel Avenue. Highveld Technopark. G E Röth did not have a service agreement with Mvelaserve. South Wing.

OTHER DIRECTORSHIPS AND PARTNERSHIPS HELD BY THE DIRECTORS AND SENIOR MANAGEMENT OF MVELASERVE DURING THE PREVIOUS FIVE YEARS: Name Director M S M Xayiya ABSA Asset Management (Proprietary) Limited Acinad Productions (Proprietary) Limited Afrilex Freight Services (Proprietary) Limited Avusa Limited Bechini Investments 65 (Proprietary) Limited Bhambatha Management Solutions (Proprietary) Limited Bizvest 6 (Proprietary) Limited Cedar Falls Properties 122 (Proprietary) Limited Desta Power Matla Holdings (Proprietary) Limited Desta Power Matla (Proprietary) Limited Dikela Investment Holdings (Proprietary) Limited Resigned Deregistered Resigned Active Resigned Resigned Active Active Resigned Resigned Resigned Directorships Status 127 . 2.DIRECTORS’ REMUNERATION The aggregate remuneration for all the Directors for the financial year ended 30 June 2010 is set out in “Management and Corporate Governance – Appointment. 1 – – – – – – – – – – – – 2 751 966 562 443 945 717 – – – – – – 4 260 156 – 2 100 000 – – – – – – – – 2 100 000 – 199 614 102 557 126 116 – – – – – – 428 288 – 19 500 75 266 140 400 – – – – – – 235 166 – 68 118 – – – – – – – – 68 118 – 5 139 228 740 267 1 212 233 – – – – – – 7 091 728 The appointment to the Board will be effective on the Listing Date. Mr J M S Ferreira and Mr G E Röth was R17. The Mvela Group Remuneration Committee approved the payment of cash bonuses to various executives involved in Mvelaserve. subject to the successful listing on the JSE. Remuneration and Borrowing Powers of Directors” section of this Pre-listing Statement. Refer to paragraph 18 of this Pre-listing Statement for more details. The total after-tax amount paid to Mr M S M Xayiya. Set out below is a breakdown of the Directors’ fees and remuneration paid to the Directors and former directors of Mvelaserve for the financial year ended 30 June 2010: Bonuses and performancerelated payments Contributions to pension schemes Medical aid contributions Name Directors’ fees Basic salary Other material benefits (Rand) Total M S M Xayiya J M S Ferreira M J Schermers2 P A M Mahlangu-Armstrong2 G E Röth O A Mabandla1 S Masinga1 N Mbalula1 F N Mantashe1 G D Harlow1 Total Notes: 1. FEES IN LIEU OF DIRECTORS’ FEES No fees in lieu of Directors’ fees were paid to any of the Directors by Mvelaserve during the financial year ended 30 June 2010.760 million. Will resign from the Board with effect from the Listing Date. Qualification. No remuneration was therefore earned for the year ending 30 June 2010.

Name Director M S M Xayiya (continued) Directorships Status Dunrose Investments 30 (Proprietary) Limited Emerald Sky Trading 339 (Proprietary) Limited Energy Advancement Research Trust (Proprietary) Limited Etis Mvelaphanda Engineering (Proprietary) Limited Foudale Investments (Proprietary) Limited Galegant Investments 73 (Proprietary) Limited GEM Diamonds Mining Corporation (Proprietary) Limited Global Village Netword Technology Proprietary) Limited Great Force Investments 204 (Proprietary) Limited Guild Hall No 22 Investment Holding Company (Proprietary) Limited Hillcrest Toyota (Proprietary) Limited Integra Systems (Proprietary) Limited Karan Beef (Proprietary) Limited KBH Consolidated Services (Proprietary) Limited Kismet Investments 57 (Proprietary) Limited Life Healthcare Group Limited Life Healthcare Group Holdings Limited Life Impilo (Proprietary) Limited Linkcorp Rail and Logistics (Proprietary) Limited Main Street 207 (Proprietary) Limited Main Street 208 (Proprietary) Limited Malundi Investments Holdings (Proprietary) Limited Marble Gold 86 (Proprietary) Limited Maslex (Proprietary) Limited Mawenzi Asset Manager (Proprietary) Limited Mawethu Holdings (Proprietary) Limited Mvelamasefield (Proprietary) Limited Mvelaphanda Administration Services (Proprietary) Limited Mvelaphanda Capital (Proprietary) Limited Mvelaphanda Diamonds (Proprietary) Limited Mvelaphanda Energy (Proprietary) Limited Mvelaphanda Financial Asset 01 (Proprietary) Limited Mvelaphanda Financial Services (Proprietary) Limited Mvelaphanda Gold (Proprietary) Limited Mvelaphanda Group Limited Mvelaphanda Holdings (Proprietary) Limited Mvelaphanda Logistics (Proprietary) Limited Mvelaphanda Private Equity (Proprietary) Limited Mvelaphanda Property Development Holding Company (Proprietary) Limited Mvelaphanda Property Development Management Company (Proprietary) Limited Mvelaphanda Property Investments (Proprietary) Limited Mvelaphanda Resources Limited Mvelaphanda Strategic Investments (Proprietary) Limited Mvelaphanda Treasury and Financial Services (Proprietary) Limited Ndowana Exploration (Proprietary) Limited Ndowana Exploration Two (Proprietary) Limited Northam Platinum Limited Ophyr Energy PLC Otterbea International (Proprietary) Limited Pan Africa Airline Investments (Proprietary) Limited Pan Africa Airways (Proprietary) Limited Platinum Mile Resources (Proprietary) Limited Retsogile Investments (Proprietary) Limited Active Deregistered Resigned Resigned Active Active Resigned Resigned Active Resigned Active Dissolved Resigned Resigned Active Resigned Resigned Resigned Deregistered Resigned Deregistered Resigned Active Resigned Resigned Resigned Resigned Active Resigned Deregistered Deregistered Resigned Resigned Resigned Active Active Deregistered Resigned Active Active Resigned Active Resigned Active Resigned Resigned Active Active Resigned Resigned Resigned Active Deregistered 128 .

Name Director M S M Xayiya (continued) Directorships Status Sanlam Developing Markets (Proprietary) Limited SMG Auto (Cape Town) (Proprietary) Limited SMG Auto (Durban) (Proprietary) Limited SMG Auto (PMB) (Proprietary) Limited Somerset Boulevard Development (Proprietary) Limited Spirito Trade 82 (Proprietary) Limited Stawelklip Estates (Proprietary) Limited Stonehurst Development (Proprietary) Limited Teta Investments (Proprietary) Limited Tyger Falls Development (Proprietary) Limited Ukwanda Investments (Proprietary) Limited Umholi Investments (Proprietary) Limited Zano Investments (Proprietary) Limited Zarara Energy (Proprietary) Limited Brown Cap Investments (Proprietary) Limited Cash Axcess Corporation (Proprietary) Limited JDBK Investments (Proprietary) Limited Palanca Investments (Proprietary) Limited Abrina 6825 (Proprietary) Limited Akula Trading 74 (Proprietary) Limited Amber Bay Investments 24 (Proprietary) Limited Anix Trading 16 (Proprietary) Limited Biomedical Life (Proprietary) Limited Browns Cash and Carry (Proprietary) Limited Business Venture Investments No 1128 (Proprietary) Limited Ceek Investments (Proprietary) Limited Clidet No 603 (Proprietary) Limited Clidet No 552 (Proprietary) Limited Clidet No 556 (Proprietary) Limited Dekrodev (Proprietary) Limited Desert Star Trading 564 (Proprietary) Limited Divine Inspiration Trading 491 (Proprietary) Limited Divine Inspiration Trading 643 (Proprietary) Limited Dixonville Investments (Proprietary) Limited Dunrose Investment 272 (Proprietary) Limited Dunrose Investments 188 (Proprietary) Limited Dunrose Trading 108 (Proprietary) Limited Dunrose Trading 127 (Proprietary) Limited E Tax Solutions (Proprietary) Limited Edata Secure Storage (Proprietary) Limited Greenbay Investments (Proprietary) Limited Grey Haven Riches 11 (Proprietary) Limited Grey Haven Riches 33 (Proprietary) Limited Grey Haven Riches 9 (Proprietary) Limited Health Strategic Investments (Proprietary) Limited Indima Media (Proprietary) Limited Itakane Trading 219 (Proprietary) Limited Just Jasmine Investments 154 (Proprietary) Limited Kingspan Investments (Proprietary) Limited Kutso Corporation Services (Proprietary) Limited Kutso Financial Services (Proprietary) Limited Kutso Holdings (Proprietary) Limited Kutso Investments (Proprietary) Limited Kutso Trading (Proprietary) Limited Lexshell 650 Investments (Proprietary) Limited Lexshell 802 Investments (Proprietary) Limited Resigned Active Active Active Deregistered Active Resigned Active Resigned Active Active Resigned Active Resigned Resigned Resigned Active Active Resigned Active Deregistered Active Resigned Active Active Active Active Active Active Deregistered Active Active Active Active Resigned Active Active Deregistered Deregistered Active Active Resigned Active Resigned Active Active Active Active Active Resigned Resigned Resigned Resigned Resigned Active Active J M S Ferreira G E Röth 129 .

Name Director G E Röth (continued) Directorships Status Main Street 207 (Proprietary) Limited Majestic Silver Trading 167 (Proprietary) Limited Market Demand Trading 333 (Proprietary) Limited Market Demand Trading 424 (Proprietary) Limited Metriglo (Proprietary) Limited Mvelaphanda Capital (Proprietary) Limited Mvelaphanda Financial Asset 01 (Proprietary) Limited Mvelaphanda Financial Services (Proprietary) Limited Mvelaphanda Group Limited Mvelaphanda Group Five Power Energy Investments (Proprietary) Limited Mvelaphanda Holdings Limited Mvelaphanda Private Equity (Proprietary) Limited Mvelaphanda Strategic Investments (Proprietary) Limited Mvelaphanda Treasury and Financial Services (Proprietary) Limited National Pride Trading 55 (Proprietary) Limited Nkulu 5 Leather Trading (Proprietary) Limited Pearl Isle Trading 22 (Proprietary) Limited Pearl Isle Trading 23 (Proprietary) Limited Platinum Arch Investments 76 (Proprietary) Limited Realcor Holdings (Proprietary) Limited Realcor Sundry Operations (Proprietary) Limited Rebhold Distribution Services (Proprietary) Limited Rebserve Residential Services (Proprietary) Limited Richtrau No 229 (Proprietary) Limited Rietbron Investments (Proprietary) Limited Rost Peak Wines (Proprietary) Limited Sheerprops 1052 (Proprietary) Limited Solar Spectrum Trading 412 (Proprietary) Limited Somerset Boulevard Development (Proprietary) Limited Sovereign Seeker Investments 161 (Proprietary) Limited Swissport South Africa (Proprietary) Limited Universal Pulse Trading 349 (Proprietary) Limited Validtrade 132 (Proprietary) Limited Vox Telecom Limited Zevoli 219 (Proprietary) Limited Air Chefs (Proprietary) Limited Air Chefs International (Proprietary) Limited Atraxis Africa (Proprietary) Limited Bustque 401 (Proprietary) Limited Consol Glass (Proprietary) Limited Consol Holdings Limited Fedlink (Proprietary) Limited Genbel Securities (Proprietary) Limited Ikhwezi Lomso Resources (Proprietary) Limited Kovacs Investments 770 (Proprietary) Limited Langa Lokulunga Investment Holdings (Proprietary) Limited Linrent Services (Proprietary) Limited Mamawood (Proprietary) Limited Mapungubwe Institute for Strategic Reflection (Proprietary) Limited Mvelaphanda Group Limited Mvelaphanda Resources Limited Proudafrique Trading 270 (Proprietary) Limited Redflex 313 (Proprietary) Limited Salamax 1660 (Proprietary) Limited Sanlam Capital Markets Limited Active Resigned Deregistered Deregistered Active Active Active Deregistered Active Active Resigned Active Active Active Deregistered Deregistered Active Active Resigned Resigned Resigned Resigned Active Active Active Resigned Active Resigned Resigned Active Active Resigned Resigned Active Resigned Resigned Active Resigned Active Resigned Resigned Deregistered Resigned Deregistered Resigned Active Resigned Active Active Active Resigned Active Deregistered Active Resigned O A Mabandla 130 .

Name Director O A Mabandla (continued) S Masinga Directorships Status South African Airways Limited (Proprietary) Limited Vodacom Group Limited Yonga Investment Consortium (Proprietary) Limited African Women Co-ordinated Investments (Proprietary) Limited Afropulse Group (Proprietary) Limited Akani Leisure Investment Casino Management (Proprietary) Limited Akani Leisure Investments (Proprietary) Limited Akani-Egoli (Proprietary) Limited Classic Number Trading 186 (Proprietary) Limited Latius Trading (Proprietary) Limited Profile Media (Proprietary) Limited Prose Investments (Proprietary) Limited Rare Holdings Limited Regent Insurance Company Limited Regent Life Assurance Company Limited Strategic Investments Portfolio (Proprietary) Limited Chrono Flex South Africa (Proprietary) Limited Defacto Investments 33 (Proprietary) Limited Dlondlobala Investments (Proprietary) Limited Drusilla Investments (Proprietary) Limited Midnight Storm Investments 77 (Proprietary) Limited Mikhovhe Enterprises West Dunes Properties 218 (Proprietary) Limited Mirror Ball Investments 198 (Proprietary) Limited Sovereign Seeker Investments 206 (Proprietary) Limited Superior System Trade 84 (Proprietary) Limited Tulip Red Investments Holdings (Proprietary) Limited Distant Sunset Investments 29 (Proprietary) Limited Izingaletu Investment Holdings (Proprietary) Limited Mthombo Consultants and Contractors (Proprietary) Limited PPC Ntsika Fund (Proprietary) Limited Siphamba Mining (Proprietary) Limited Allied Production Industries (Proprietary) Limited Black Ginger 59 (Proprietary) Limited Blue Label Call Centre Blue Label Call Centre Blue Label Distribution Blue Label Distribution Blue Label Telecoms Limited Blue Label Trading Company (Proprietary) Limited BW Mining (Proprietary) Limited Cefurn Investments (Proprietary) Limited Cellfind (Proprietary) Limited Cellfind International (Proprietary) Limited Clidet No 390 (Proprietary) Limited Copper Sunset Trading 148 (Proprietary) Limited Copper Sunset Trading 148 (Proprietary) Limited Credex Finance (Proprietary) Limited Datacel Direct (Proprietary) Limited Dataforce Trading 240 (Proprietary) Limited Duna Properties (Proprietary) Limited Dupleix Liquid Meters (Proprietary) Limited Edusol (Proprietary) Limited Ellblue Properties (Proprietary) Limited Emergent Management Company (Proprietary) Limited Fersoe Property Development (Proprietary) Limited Resigned Resigned Resigned Resigned Active Resigned Resigned Active Active Active Active Active Active Active Active Resigned Resigned Resigned Active Active Active Active Active Active Active Active Active Active Active Active Active Resigned Active Active Active Active Active Active Resigned Active Active Active Active Resigned Resigned Active Active Resigned Active Resigned Resigned Resigned Resigned N Mbalula F N Mantashe G D Harlow 131 .

Name Director G D Harlow (continued) Directorships Status Flaming Silver Trading 175 (Proprietary) Limited Fluxrab Investments No 125 (Proprietary) Limited Friedshelf 657 (Proprietary) Limited Friedshelf 756 (Proprietary) Limited Hix Technologies (Proprietary) Limited ITQ (Proprietary) Limited Jowima Properties (Proprietary) Limited K Luff Plumbing Services (Proprietary) Limited Knowledge Objects (Proprietary) Limited Legend Gold Stand 251 (Proprietary) Limited Legend Golf Stand 243 (Proprietary) Limited Leo Financial Management Services (Proprietary) Limited Mandla Coal Resources (Proprietary) Limited Mandla Goal Resources (Proprietary) Limited Mashala Hendrina Coal (Proprietary) Limited Mashala Resources (Proprietary) Limited Maxitrade 106 General Trading (Proprietary) Limited Mayfair Speculators (Proprietary) Limited Metallurgical Processes (Proprietary) Limited Metermatic (Proprietary) Limited Micawaber 428 (Proprietary) Limited Mobile at Work (Proprietary) Limited Moneyline 311 (Proprietary) Limited Mowana Printing Solutions (Proprietary) Limited Namib Drilling (Proprietary) Limited Newshelf 828 (Proprietary) Limited Objectsco (Proprietary) Limited Penumbra Coal Mining (Proprietary) Limited Plot 81 Zeekoeigat (Proprietary) Limited Policy Property Holdings One (Proprietary) Limited Policy Property Holdings Two (Proprietary) Limited Primacote Industrial Painting Contractors (Proprietary) Limited QD Group (Proprietary) Limited Rely Precision Castings (Proprietary) Limited Richmark Holdings (Proprietary) Limited Sanco Leisure (Proprietary) Limited Section 5 East End Business Park (Proprietary) Limited Sephaku Delmas Properties (Proprietary) Limited The Number Plate Shop (Proprietary) Limited Thebe Financial Services (Proprietary) Limited Thembalethu Investment Holdings (Proprietary) Limited Tomcat Software SA (Proprietary) Limited TRI-COR Industries (Proprietary) Limited TRI-COR Sings (Proprietary) Limited Trillion International (Proprietary) Limited Ubambo Telecommunications (Proprietary) Limited Ubambo Investments Holdings (Proprietary) Limited Unihold Limited Unihold Armed Response Holdings (Proprietary) Limited Unihold Business Solutions (Proprietary) Limited Unihold Communications (Proprietary) Limited Unihold Engineering (Proprietary) Limited Unihold Group (Proprietary) Limited Unihold Resources (Proprietary) Limited Active Active Active Active Active Resigned Resigned Resigned Resigned Active Active Active Resigned Active Active Active Active Resigned Resigned Active Active Active Active Active Active Active Resigned Active Resigned Active Active Resigned Resigned Resigned Resigned Active Active Active Resigned Voluntary Liquidation Resigned Resigned Resigned Resigned Resigned Active Active Active Resigned Resigned Active Resigned Active Active 132 .

Name Director G D Harlow (continued) Directorships Status Uninex (Proprietary) Limited Uvongo Falls No 26 (Proprietary) Limited Vespafrica (Proprietary) Limited Walrind (Proprietary) Limited Walro Flex (Proprietary) Limited Wesselton Opencast (Proprietary) Limited Wildekrans Wine Estate (Proprietary) Limited Resigned Active Resigned Resigned Resigned Active Active Senior management M J Schermers Consolidated Modderfontein Mines Limited Consolidated Modderfontein Mines 1979 (Proprietary) Limited JIC Mining Services (1979) (Proprietary) Limited M J F Safety Equipment (Proprietary) Limited Modderfontein Seventy-Four (Proprietary) Limited Nigel Gold Mining Company (Proprietary) Limited Pamodzi Gold Limited Pamodzi Gold East Rand (Proprietary) Limited Pamodzi Gold Orkney (Proprietary) Limited Pamodzi Gold West Rand (Proprietary) Limited Pretklerk Gold Mining Company (Proprietary) Limited Pretklerk Marievale Gold Mining Company (Proprietary) Limited Pretklerk Springs Daggafontein Gold Mining Company (Proprietary) Limited Super Laboratory Services (Proprietary) Limited Rebhold Distribution Services (Proprietary) Limited The Grootvlei Proprietary Mines (Proprietary) Limited Tina Du Preez Beleggings (Proprietary) Limited Gunnebo South Africa (Proprietary) Limited Provicom Risk Solutions (Proprietary) Limited Erf 873 Glen Erasmia Extention 7 Home Owners Association Feta Freight Systems International Limited Karabo Logistics (Proprietary) Limited Trans Global Freight (Proprietary) Limited Brown Cap Investments (Proprietary) Limited Cash Axcess Corporation (Proprietary) Limited Commercial institute of Security Training (Proprietary) Limited Praysa Trade 1061 (Proprietary) Limited Telesafe (Proprietary) Limited Vanfour Boerdery (Proprietary) Limited Windtalk Holdings (Proprietary) Limited Baytree Functions and Events Trading (Proprietary) Limited Deregistered Resigned Resigned Deregistered Resigned Resigned Resigned Resigned Resigned Resigned Resigned Resigned Resigned Active Active Deregistered Active Resigned Resigned Active Active Active Active Active Resigned Active Deregistered Resigned Active Deregistered Active B E Spence C R Waterson P A van Niekerk T D Pitikoe 133 .

ADDITIONAL INFORMATION None of the Directors or senior management referred to in this Pre-Listing Statement: • have been declared bankrupt or have entered into an individual voluntary compromise arrangement to surrender his or her estate. creditors’ voluntary liquidation. • have had any of his or her assets subject to receivership. any compulsory sequestration. including recognised professional bodies or been disqualified by a court from acting as a director of a company or from acting in the management or conduct of the affairs of any company. • are or have been a partner in a partnership at a time of. a receivership of any assets of such partnership. company voluntary arrangement or any compromise or arrangement with the company’s creditors generally or with any class of its creditors. • are or have been publicly criticised by any statutory or regulatory authorities. or within twelve months preceding. 134 . or within twelve months preceding. compulsory liquidation. or within twelve months preceding. administration or voluntary arrangement of such partnership. • are or have been a partner in a partnership at the time of. administration. • are or were directors with an executive function of any company at the time of. any receivership. and/or • are or have been convicted of any offence involving dishonesty.

ANNEXURE 7 DETAILS OF SUBSIDIARY COMPANIES AND THEIR DIRECTORS 1. OPERATING SUBSIDIARIES Name and registration number Catering 1 Royalserve Catering (Proprietary) Limited (1994/005030/07) RoyalSechaba Food Service (Proprietary) Limited (2000/012826/07) Royal Food Correctional Services (Proprietary) Limited (1997/015974/07) Royal Food Services (Limpopo) (Proprietary) Limited (2000/015444/07) Royal Food Services North West (Proprietary) Limited (1998/003317/07) Royal Food Services Northern Cape (Proprietary) Limited (1997/020184/07) Ithabeleng Food Services (Proprietary) Limited (2003/011842/07) South Africa 27 July 2000 South Africa 26 February 2000 South Africa 23 September 1997 South Africa 10 July 2000 1 000 shares of R1 each 1 020 shares of R1 each 100 shares of R1 each 120 shares of R1 each Catering 17 July 1996 Date and country of incorporation Issued ordinary share capital Main business Date of becoming subsidiary 2 Catering 01 June 2000 3 Catering 01 June 2005 4 Catering 01 June 2005 5 South Africa 24 February 1998 100 shares of R1 each Catering 01 June 2005 6 South Africa 25 November 1997 100 shares of R1 each Catering 01 June 2005 7 South Africa 27 May 2003 100 shares of R1 each Catering 27 May 2003 Cleaning 8 Royalserve Cleaning (Proprietary) Limited (2000/011155/07) Dinosi Cleaning Services (Proprietary) Limited (2003/006230/07) South Africa 7 June 2000 South Africa 17 March 2003 South Africa 11 September 2002 100 shares of R1 each 100 shares of R1 each 100 shares of R1 each Cleaning 07 June 2000 9 Cleaning 17 March 2003 10 Ikhayelihle Mvelaserve Cleaning Services (Proprietary) Limited (2002/022568/07) 11 Rebserve Namibian Cleaning Services (Proprietary) Limited (2000/285) 12 Mediguard WIC Cleaning Services (Proprietary) Limited (2009/1424) Cleaning 11 September 2002 Namibia 27 March 2000 100 shares of N$1 each Cleaning 27 March 2000 Lesotho 20 November 2009 510 shares of R1 each Cleaning 14 May 2010 135 .

Name and registration number Facilities Management 13 TFMC Holdings (Proprietary) Limited (2000/001009/07) 14 Rebserve IT Procurement (Proprietary) Limited (2000/021547/07) Date and country of incorporation Issued ordinary share capital Main business Date of becoming subsidiary South Africa 26 January 2000 South Africa 25 August 2000 1 000 shares of R1 each 100 shares of R1 each 2 000 shares of R1 each 100 shares of R1 each 100 shares of R1 each 1 000 000 shares of R1 each Facilities management Facilities management Facilities management Facilities management Maintenance services 25 August 2000 26 August 2000 15 Total Facilities Management South Africa Company (Proprietary) Limited 26 August 1999 (1999/018572/07) 16 Rebserve Facilities Management South Africa (Proprietary) Limited 15 March 1999 (1999/005381/07) 17 TFMC Maintenance Services (Proprietary) Limited (2000/011246/07) 18 TFMC FM Services (Proprietary) Limited (1998/019278/07) 19 TFMC Workplace Services (Proprietary) Limited (2000/008903/07) 20 Experience Delivery Company (Proprietary) Limited (2003/012434/07) Security 21 Protea Coin Group (Assets in Transit and Armed Reaction) (Proprietary) Limited (1999/003646/07) 22 Protea Coin Group (Technical and Physical Security) (Proprietary) Limited (1999/001641/07) 23 Coin Aviation Security (Proprietary) Limited (2004/016588/07) 24 Coin Risk Management (Proprietary) Limited (2003/007635/07) 25 Smart Solution Holdings (Proprietary) Limited (2001/022917/07) South Africa 22 February 1999 South Africa 7 June 2000 South Africa 29 September 1999 26 August 1999 15 March 1999 07 June 2000 Facility 15 January 2007 management and engineering Facilities 15 January 2007 management Facilities management 02 June 2003 South Africa 16 May 2000 South Africa 2 June 2003 175 000 shares of R1 each 100 shares of R1 each 111 shares of R1 each Security services 01 July 1999 South Africa 27 January 1999 111 shares of R1 each Security services 01 July 1999 South Africa 17 June 2010 South Africa 1 April 2003 100 shares of R1 each 100 shares of R1 each Security services Financial and risk management services Holding company 17 June 2004 01 April 2003 South Africa 26 September 2001 100 shares of R1 each 26 September 2001 136 .

Name and registration number Security 26 Cameos Solutions (Proprietary) Limited (2001/022909/07) 27 Coin Cameos (Proprietary) Limited (2005/042799/07) 28 Coin Security International (Proprietary) Limited (2004/000943/07) 29 Protea Coin Cargo Protection (Proprietary) Limited (2006/002139/07) 30 Protea Aviation (Proprietary) Limited (1998/008495/07) 31 Protea Security (West Rand) (Proprietary) Limited (1995/000070/07) 32 Protea Security Services (Reaction Unit) (Proprietary) Limited (1995/000075/07) Diversified Services Date and country of incorporation Issued ordinary share capital Main business Date of becoming subsidiary South Africa 26 September 2001 South Africa 6 December 2005 South Africa 20 January 2004 South Africa 26 January 2006 South Africa 6 May 1998 South Africa 4 January 1995 South Africa 4 January 1995 100 shares of R1 each 1 000 shares of R1 each 100 shares of R1 each 100 shares of R1 each 100 shares of R1 each 4 200 shares of R1 each 4 200 shares of R1 each Security services Security services Security services Security services Security and aviation services Security services Security services 26 September 2001 06 December 2005 20 January 2004 26 January 2006 01 July 1999 01 July 1999 01 July 1999 33 Rebhold Freight Services (2000) South Africa (Proprietary) Limited 15 September 1983 (1987/000113/07) 34 King Pie Holdings (Proprietary) Limited (1997/008676/07) 35 BMO Food Services (Proprietary) Limited (1998/013348/07) 36 Zonke Monitoring Systems (Proprietary) Limited (1995/000075/07) South Africa 5 June 1997 100 shares of R1 each Freight forwarding and customs clearing Franchisor of the King Pie brand Manufacturer of pie products Limited payout machine monitoring services Computer services 01 January 2000 101 shares of R1 each 05 June 1997 South Africa 13 July 1998 South Africa 31 July 2000 101 shares of R1 each 1 000 shares of R1 each 01 February 2003 01 July 2004 37 Circle ICT Solutions (Proprietary) Limited (2000/012478/07) Management Company 38 Mvelaphanda Management Services (Pty) Limited (2000/012781/07) South Africa 20 June 2000 100 shares of R1 each 01 September 2010 South Africa 22 June 2000 100 shares of R1 each Management company 22 June 2010 137 .

MATERIAL CHANGES TO THE BUSINESSES OF MVELASERVE GROUP COMPANIES The material changes to the business of Mvelaserve which have taken place since 30 June 2010 relate to the Debt Restructure. NON-OPERATING AND DORMANT SUBSIDIARIES Name Atreb Consulting Services (Proprietary) Limited Atreb Facilities Management (Proprietary) Limited Blacksteer Holdings (Proprietary) Limited (under voluntary liquidation) Contract Forwarding (Proprietary) Limited Ilembe Facilities Management Services (Proprietary) Limited Karabo Logistics (Proprietary) Limited Majormatic 108 (Proprietary) Limited Pacific Breeze Trading 65 (Proprietary) Limited Phumelela Coin Promotions (Proprietary) Limited Protea Security (Group Holdings) (Proprietary) Limited (under voluntary liquidation) Trans Global Freight (Proprietary) Limited Registration number 2000/024830/07 2000/002481/07 2004/001439/07 1983/010155/07 2007/028125/07 2002/020487/07 2003/023215/07 2005/006348/07 2003/020571/07 1992/006393/07 1997/011080/07 On the Listing Date. save for those mentioned in paragraph 39 of this Pre-listing Statement. 138 . Zonke acquisition and the settlement of inter-company loans between Mvela Group and Mvelaserve in terms of the Restructuring. 2.On the Listing Date. all of the above Subsidiaries will be wholly-owned by Mvelaserve. all of the above Subsidiaries will be wholly-owned by Mvelaserve. 4. other than the shareholders. holds any rights to enable such a person to vary the voting rights held in any Subsidiary. holds any rights to enable such a person to vary the voting rights held in any subsidiary. other than the following Subsidiaries and associates: • Dinosi Cleaning Services (Proprietary) Limited – 55% • Experience Delivery Company (Proprietary) Limited – 48% • Ikhayelihle Mvelaserve Cleaning Services (Proprietary) Limited – 49% • Ithabeleng Food Services (Proprietary) Limited – 85% • Khanya Rebserve Cleaning Service (Proprietary) Limited – 49% • Mediguard WIC Cleaning Services (Proprietary) Limited – 51% • Rebserve IT Procurement (Proprietary) Limited – 60% • Rebserve Facilities Management (Proprietary) Limited – 80% • Royal Food Correctional Services (Proprietary) Limited – 75% • Smart Solutions Holdings (Proprietary) Limited – 84% • TFMC FM Services (Proprietary) Limited – 90% • TFMC Workplace Services (Proprietary) Limited – 40% • Zonke Monitoring Systems (Proprietary) Limited – 75% No person. 3. other than the shareholders. other than the following Subsidiaries and associates: • Phumelela Coin Promotions (Proprietary) Limited – 50% • Ilembe Facilities Management Services (Proprietary) Limited – 60% No person. ALTERATIONS TO SHARE CAPITAL OF MVELASERVE GROUP COMPANIES In the three years prior to the Listing Date there have been no material changes to the share capital of Mvelaserve Group companies.

N M Groeneveld. J M S Ferreira. N Kolisile. R M Lukuko B E Spence. J J Mabaso. L F Mahlati. T D Mdluli. E P Grobler. P A van Niekerk G R McGregor. J J Schoeman. Z Vokwana D J Jordaan. E P Grobler. C R Waterson. E P Grobler. J J Schoeman. J M S Ferreira. T D Pitikoe. E Lehmann. N Kolisile. J M S Ferreira. P A van Niekerk E P Grobler. D Kynaston. J M S Ferreira. N M Groeneveld G V Groenewald. T D Pitikoe. J De Beer. Z Vokwana. J De Beer. P A M Mahlangu P A van Niekerk. J M S Ferreira. L M Rudlin M Maluleka. D M Moise. DIRECTORS OF OPERATING SUBSIDIARIES The directors of Mvelaserve’s operating subsidiaries are set out in the table below: Company BMO Food Services (Proprietary) Limited Cameos Solutions (Proprietary) Limited Circle ICT Solutions (Proprietary) Limited Coin Aviation Security (Proprietary) Limited Coin Cameos (Proprietary) Limited Coin Risk Management (Proprietary) Limited Coin Security International (Proprietary) Limited Dinosi Cleaning Services (Proprietary) Limited Experience Delivery Company (Proprietary) Limited Ikhayelihle Mvelaserve Cleaning Services (Proprietary) Limited Ithabeleng Food Services (Proprietary) Limited Khanya Rebserve Cleaning Service (Proprietary) Limited King Pie Holdings (Proprietary) Limited Mediguard WIC Cleaning Services (Proprietary) Limited Protea Aviation (Proprietary) Limited Protea Coin Cargo Protection (Proprietary) Limited Protea Coin Group (Assets in Transit and Armed Reaction) (Proprietary) Limited Directors C R Waterson. P A M Mahlangu. T T Mabila L Hargraves. P A M Mahlangu Protea Coin Group (Technical and Physical Security) (Proprietary) Limited Protea Security (West Rand) (Proprietary) Limited Protea Security Services (Reaction Unit) (Proprietary) Limited Rebhold Freight Services (2000) (Proprietary) Limited Rebserve Facilities Management (Proprietary) Limited Rebserve IT Procurement (Proprietary) Limited Rebserve Namibian Cleaning Services (Proprietary) Limited B S de Waal. M S Malemela. D M Moise. N Kolisile. P Rantsoareng. M F Sekgome. J Geldenhuys. P A van Niekerk. P A van Niekerk E P Grobler. J M S Ferreira. M Conlin. J Geldenhuys. J M S Ferreira. G R McGregor. P A M Mahlangu Protea Coin Group (Security Services) (Proprietary) Limited B S de Waal. P A van Niekerk E P Grobler. J M S Ferreira E P Grobler. Z Vokwana. P A van Niekerk. V Rantsoareng. T D Pitikoe F Mugari. N Kolisile. G V Groenewald. E P Grobler. P A van Niekerk. P A M Mahlangu-Armstrong. TD Pitikoe 139 . J M S Ferreira C R Waterson. E P Grobler. S Seeiso E P Grobler. J M S Ferreira P A van Niekerk. P A M Mahlangu-Armstrong M E A Maphumulo. R M Lukuko C Bolm. E Ritson. S Fernandes. W Pretorius E P Grobler D B le Roux. T D Pitikoe F Vungwana. J M S Ferreira.5. P A van Niekerk. W Pretorius F Mugari. R Bouwer. D T Mahlalela. G R McGregor. N M Groeneveld. P A M Mahlangu B S de Waal. P A van Niekerk. L Khomari. R Bouwer. D M Moise.

N M Groeneveld J J Mabaso. F Mugari. M H Malope Further details of all the Directors and senior managers of Mvelaserve are set out in Annexure 6 to this Pre-listing Statement. N M Groeneveld. T D Pitikoe E P Grobler B E Spence. T P Sekhoto G R McGregor. T D Pitikoe. N M Groeneveld. F Mugari. T D Pitikoe G R McGregor. M J Schermers. P Van Niekerk. F Mugari. T D Pitikoe G R McGregor. G R McGregor. K Cloete. J M S Ferreira. T D Pitikoe F Mugari. F Mugari. 140 . Y Z Cuba D Moodley. N M Groeneveld B E Spence. J Mostert. M Steyn. M Lukuko. Y Z Cuba. N M Groeneveld. T D Pitikoe F Mugari. J M S Ferreira. R Redaelli B E Spence. T D Pitikoe F Mugari. M J Schermers. T Molai B E Spence. M S Tshungu. G R McGregor. R Redaelli. N M Groeneveld. G R McGregor. L Van Niekerk.Company Royalserve Catering (Proprietary) Limited Royal Food Correctional Services (Proprietary) Limited RoyalSechaba Food Service (Proprietary) Limited Royal Food Services (Limpopo) (Proprietary) Limited Royal Food Services North West (Proprietary) Limited Royal Food Services Northern Cape (Proprietary) Limited Royalserve Cleaning (Proprietary) Limited Smart Solution Holdings (Proprietary) Limited TFMC FM Services (Proprietary) Limited TFMC Holdings (Proprietary) Limited TFMC Maintenance Services (Proprietary) Limited TFMC Workplace Services (Proprietary) Limited Total Facilities Management Company (Proprietary) Limited Zonke Monitoring Systems (Proprietary) Limited Directors G R McGregor.

Pangbourne TFMC (Proprietary) Limited Office building 30 November 2011 R444 845 BMO Food Services (Proprietary) Limited Royalserve Catering (Proprietary) Limited Royalserve Catering (Proprietary) Limited Royalserve Cleaning (Proprietary) Limited Office building and factory Office building Factory 30 April 2014 R196 156 Robow Investments (Proprietary) Limited Silverdawn Investments 200 CC The Racing Investment Trust 31 March 2011 30 June 2011 R255 846 R116 143 Office building 31 December 2010 R147 800 Sage Wise (Proprietary) Limited Portion 8 Erf 1 Highveld (Proprietary) Limited Protea Coin Group (Assets in Transit and Armed Reaction) (Proprietary) Limited Mvelaserve Limited Office building 30 November 2010 R122 361 Office building 31 October 2014 R115 000 Principal properties owned Owner Protea Security (West Rand) (Proprietary) Limited Protea Security (West Rand) (Proprietary) Limited Description Land. Germiston Portion 8 Erf1 Highveld Expiry date 30 November 2010 Monthly rental R72 000 Transit Ads (Proprietary) Limited Office and warehouse 1 February 2012 R22 361 Eris Property Group Office and warehouse 20 April 2013 R12 582 Growth Point Securitisation Warehouse Trust I-Four. Waterval 273 Title deed no.ANNEXURE 8 DETAILS OF PRINCIPAL IMMOVABLE PROPERTIES LEASED OR OWNED Details of the principal immovable properties leased and owned by Mvelaserve and its Subsidiaries are as follows: Principal properties leased Lessor Gensec Property Fund Lessee Rebhold Freight Services (2000) (Proprietary) Limited Rebhold Freight Services (2000) (Proprietary) Limited Rebhold Freight Services (2000) (Proprietary) Limited Property type Location/area Office and warehouse Johannesburg. T141584/2005 T40862/2010 141 . Portion 135 of the Farm Waterval 273 Land. Cape Town 14 Friesland Drive Longmeadow Business Estate. Unit 2 First Floor Montague Gardens Durban Branch – Unit 19 Greenfield’s Business Centre 1451 North Coast Road Durban 269 West Street C/o Lenchen Avenue Meersig Building Centurion East side Corporate Close 807 Richards Drive Midrand 26 Charles de Gaulle Street Highveld. Centurion 63 Adriana Crescent Gateway Industrial Park Centurion Rebserve House Regent Square Doncaster Road Kenilworth. Head Office 49 Director Road Aeroport Industrial Park Spartan Cape Town Branch – 9 Dawn Road. Plot 99.

as at 30 June 2008. nor are there any proposed material acquisitions of any securities in or business undertakings of any other company or business enterprise or immovable property. Material disposals Mvelaserve has made a number of minor disposals in the past three years. J W Trollope and P W Trollope 142 . 30 Melrose Boulevard. Melrose Arch. no material acquisitions (as contemplated by the Listings Requirements) have been made by Mvelaserve Group within the three years preceding the date of this Pre-listing Statement. Ekurhuleni • Beneficial shareholders: D H C le Roux. The asset has not been pledged or ceded in any way. (See paragraph 23 of this Pre-listing Statement “Statement of Financial Position – Assets and liabilities in disposal group held for sale”) Effective date 1 October 2008 The details of the acquirors are as follows: • Name: Trollope Holdings (Proprietary) Limited • Address: The Farm Elandsfontein 412 J. The details of the disposal are recorded below: Name of company Trollope Mining Services (2000) (Proprietary) Limited Nature of business Mining contracting services Salient financial information • Value of transaction – R32 million • Fully settled in cash • The value of the net assets of the company were R103 million. The details of the vendor are as follows: • Name: Mvela Group • Address: 1st Floor.ANNEXURE 9 MATERIAL ACQUISITIONS AND DISPOSALS IN THE PRECEDING THREE YEARS Material acquisitions Save for the acquisition of Zonke by Mvelaserve described in Annexure 1.. Mvela Group has not signed any service agreements with Mvelaserve that preclude them from carrying on business in competition with the vendor. Zonke has been transferred into the name of Mvelaserve. 2076 • Beneficial shareholders: Refer to paragraph 6 of this Pre-listing Statement Mvela Group has not given any guarantee or warranty in relation to the sale of the assets. Name of company Zonke Monitoring Systems (75% controlling interest) Nature of business LPM monitoring services Salient financial information • Value of transaction – R81 million • Settled through the issue of 6 850 937 Mvelaserve Ordinary Shares Effective date 7 October 2010 No goodwill arose on the acquisition of Zonke by Mvelaserve from Mvela Group as the acquisition took place between group companies. No loans have been incurred or are to be incurred in order to finance the acquisition of Zonke. only one which was material to Mvelaserve. Johannesburg.R.

Set out below are the significant terms of the facility provided: Borrower: Structure: Mvelaserve Limited Amortising term loan – R250 million Revolving asset backed financing – R200 million General banking facility – R100 million Amortising term loan – payable quarterly.25% General banking facility – Nedbank’s prime lending rate minus 0.75% Unlimited cross guarantee between Mvelaserve and all Group companies First ranking cession of debtors by Mvelaserve and all Group companies The Long-term Senior Facilities Agreement and other relevant legal agreements will be signed prior to the Listing Date. acting through its corporate banking division in order to enable Mvelaserve to replace the redeemable preference shares that existed in the Group as at 30 June 2010 (refer to note 18 in the historical consolidated financial statements – Annexure 2). over five years General banking facility – repayable on demand Amortising term loan – 3-month JIBAR plus 2. The Standard Bank of South Africa Limited Nedbank Limited1 Long-term Senior Facilities To fund repayment of preference shares in Mvelaserve 550 000 Note 1 Note 1 Operating cash flow Note 1 Mvelaserve has entered into a Long-term Senior Facilities Agreement with Nedbank Limited (“Nedbank”). Material loans receivable balances as at 30 June 2010.85% (nacq) Revolving asset backed financing – Nedbank’s prime lending rate minus 1. 2. Mvelaserve did not have any material loans. Material borrowings of Mvelaserve as at the Last Practicable Date: Lender Nature of finance Origination To fund certain fixed asset purchases Amount outstanding (R’000) 193 299 How repayment is intended to be funded Operating cash flow Interest rate Interest rate linked to the prime overdraft rate ranging between 9% and 12% per annum Security Certain fixed assets with a book value of R199.ANNEXURE 10 DETAILS OF MATERIAL BORROWINGS AND MATERIAL LOANS 1. over five years Revolving asset backed financing – each contract repayable monthly. Payment period: Interest rate: Security: Conditions: Other than that stated above.482 million per month Note 1 Nedbank Capitalised Limited finance lease First National agreements Bank. borrowings or outstanding loan capital at the Last Practicable Date. This Nedbank debt will be used to settle this redeemable preference shares such that they do not form part of the share capital of the Group on the Listing Date. There were no material loans receivable by Mvelaserve or any of its Subsidiaries as at 30 June 2010. 143 .72 million Repayment terms Repayable in monthly instalments over 36 to 48 months to the amount of R6. subject to the fulfilment of conditions as are standard in agreements of this nature.

3. Material inter-company balances as at 30 June 2010: The table below shows all inter-group balances in the Mvelaserve Group as at 30 June 2010: Loan from Mvelaserve: Mvelaserve Management Services Protea Coin Royalserve Cleaning TFMC Holdings Other Loan from Mvelaserve Management Services: Contract Forwarding Amount (R’000) 584 704 118 871 88 625 78 066 45 973 Amount (R’000) 23 669 144 .

Mvelaserve only acquired the 75% held by Mvela Group in order to maintain a similar shareholding structure as at incorporation of Zonke. Motcom (Proprietary) Limited. other than in the ordinary course of the business carried on by Mvelaserve. Mvela Group had been a 75% shareholder of Zonke since incorporation of the company. Prior to the Zonke acquisition by Mvelaserve. 145 . none of which are associated with the Mvela Group. The acquisition was concluded for an aggregate amount of R81 million. the controlling shareholder of Mvelaserve. as mentioned in paragraph 57 of this Pre-listing Statement. The remaining 25% of Zonke continues to be collectively held by Route Gaming Solutions (Proprietary) Limited.ANNEXURE 11 MATERIAL CONTRACTS ENTERED INTO BY MVELASERVE IN THE TWO YEARS PRECEDING THE DATE OF THE PRE-LISTING STATEMENT The material contracts that have been entered into by Mvelaserve during the two years preceding the date of this Pre-listing Statement. Mabutho Investments (Proprietary) Limited and Virindra Virjanand Parmanand. Contracts relating to Directors and managerial remuneration Refer to Annexure 6 for the disclosure of key terms of the contracts relating to Directors and managerial remuneration. In terms of an assetfor-share agreement Mvelaserve allotted and issued 6 850 937 Mvelaserve Ordinary Shares to Mvela Group in exchange for their shares in Macthyme Investments (Proprietary) Limited which holds a 75% in Zonke. in order to comply with the CEMS licensing agreement with the NGB. are as follows: Acquisition of 75% of Zonke by Mvelaserve from Mvela Group Mvelaserve has acquired an effective 75% of the share capital of Zonke from Mvela Group.

24. or assigns his estate for the benefit of his creditors or suspends payment or files a petition for the liquidation of his affairs.ANNEXURE 12 EXTRACTS FROM THE ARTICLES OF ASSOCIATION Set out below are extracts from the Articles of Association: DIRECTORS 12.3 The Directors shall not be obliged to hold any shares to qualify them as Directors. are outside the scope of the ordinary duties of a Director. 20. he may receive such extra remuneration as determined by a disinterested quorum of the Directors and such extra remuneration may be either in addition to or in substitution for the remuneration provided for in Article 19. 19. the remaining Directors shall not act for any purpose other than calling a General Meeting or to fill the vacancy. 12. 146 .4.6 The continuing Directors may act notwithstanding any casual vacancy in their body. including its uncalled or unpaid Capital. 19.1 The number of directors shall not be less than 4 (four). mortgage or charge upon account or any of the property or assets of the Company. Directors 19. so long as there remain in office not less than the prescribed minimum number of Directors duly qualified to act.3 The Directors shall cause a proper register to be kept in accordance with the provisions of the Act of all mortgages and charges specifically affecting the property of the Company. 19.1 A Director shall cease to hold office as such: 20. If any Director shall be required to perform extra service or to go or to reside abroad. Such remuneration shall be divided among the Directors in such proportions and manner as the said committee may determine.1. 12. or as an additional Director. 19. the name of the mortgagee or person entitled to such charge and such further particulars as the provisions of the Act require.5. 19.1. or if any Director shall be specially occupied about the Company’s business or perform services which.2 The Directors may raise or secure the payment or repayment of such moneys in such manner and upon such terms and conditions in all respects as they think fit.4 The remuneration of the Directors shall be such sum as may from time to time be determined by an independent.2 if he becomes of unsound mind. or compounds with his creditors.2 and 27. the amount of the charge created.3.5 The Directors shall be paid all their travelling and other expenses properly and necessarily incurred by them in and about the business of the Company. whether by creation and issue of Debentures. and they shall cause to be entered in such register in respect of each mortgage or charge a short description of the property mortgaged or charged. Disqualification of Directors 20.1.1 if he becomes insolvent.1 From time to time the Directors may borrow or raise for the purposes of the Company such sums as they deem fit.2 The Directors shall have power at any time and from time to time to appoint any person as a Director either to fill a casual vacancy. Any person appointed to fill a casual vacancy or as an additional director shall retain office only until the next following annual general meeting and his appointment shall be subject to confirmation at such annual General Meeting. Borrowing powers of Directors 12. but if the number falls below the minimum prescribed in Article 19. 20. Executive Directors shall not be entitled to receive Directors’ fees (in addition to the remuneration they may receive as employees of the Company). and in attending meetings of the Directors or of committees thereof. in the opinion of the Directors. non-executive committee of the Directors. but shall be entitled to payments under Articles 19. 19.

on the basis that special meetings of Directors shall not be counted for the purposes of this Article 20. whether with regards to such office or as a vendor or purchaser or otherwise. 21. Contracting with Directors 21.1.3. his vote shall not be counted. and if he does so vote.2 Notwithstanding anything contained in the Articles. modification or operation of a superannuation fund or retirement benefits scheme under which a Director may benefit and which has been approved by or is subject to and conditional upon approval by the relevant revenue authorities for taxation purposes.20. or any contract or arrangement entered into by or on behalf of the Company. provided that these prohibitions shall not apply to: 21.8 any proposal concerning the adoption. 20.3.6 if he shall pursuant to the provisions of the Act be disqualified or cease to hold office or be prohibited from acting as Director.1 any contract or dealing with a Company of which the Directors or any one of them may be directors.3.7 the giving of any security or indemnity to a third party in respect of a debt or obligation of the Company or any of its subsidiaries for which the Director himself has assumed responsibility in whole or in part under a guarantee or indemnity or by the giving of security. 21.1.5 one month.1.1.1 No Director shall be disqualified by his office from contracting with the Company. 21. 21.5.5 any resolution determining the remuneration of the Directors in terms of Article 19.3 any contract to underwrite or sub-underwrite any Shares or obligations of the Company or any Shares in or Debentures or obligations of any Company in which the Company may be in any way interested. 20. officials or employees or otherwise interested. members. or any allotment or issue complying with the provisions of section 222 of the Act. nor shall any such contract.3.3. 20.4 if he is removed under Article 22. after he has given notice in writing of his intention to resign. 21.5 Any notice given to the Directors by a Director to the effect that he is a member of a specified company or firm shall comply with the provisions of the Act. with the permission of the Directors. in which any Director shall in any way be interested. the Company shall not make any loan to a Director or enter into any guarantee or provide any security in connection with a loan made to a Director by any other person if and so far as any such loan. or of the fiduciary relationship thereby established.7 if he is or accepts any appointment as a Director or an employee of a company which is a competitor of the Company. or.3 if he is absent from 4 (four) consecutive meetings of the Directors without leave of the Directors whilst not engaged in an business of the Company which may necessitate such absence and is not represented at any such meetings by an alternate Director. 21. 21. managers. 21.6 any contract for the payment of commission in respect of the subscription for Shares or obligations of the Company. 21. 21. nor shall any Director so contracting or being so interested be liable to account to the Company for any profit realised by any such contract or arrangement by reason of such Director holding that office.2 or Article 22.3. but the nature of his interest shall be declared by him in accordance with the provisions of the Act. 21. earlier.4 or Article 19. guarantee or provision of security is at any time prohibited by the Act.4. 147 . 21. be or be liable to be avoided.3 No Director shall vote as a Director in respect of any contract or arrangement in which he is so interested as aforesaid.3 may at any time be suspended or relaxed to any extent by the Company in a General Meeting. whether directly or indirectly.4 any proposal concerning an offer of Shares or Debentures or other Securities by the Company or any of its subsidiaries for subscription or purchase in which offer a Director is or is to be interested directly or indirectly in the underwriting or sub-underwriting thereof.1.3. or 20. and the Directors resolve that the office be vacated.1. provided that the Directors shall have power to grant any Director leave of absence for any or an indefinite period.2 he giving of any security or indemnity to a Director in respect of money lent or obligations or other liabilities incurred by him at the request of or for the benefit of the Company or any of its subsidiaries.3.4 The prohibitions contained in Article 21.3.

21. the number nearest to. managers and secretaries and shall furnish the Registrar of Companies with particulars thereof as provided for in the Act. the place of any retiring Director is not filled. remuneration and otherwise are fully disclosed to the board and are determined by a disinterested quorum of the directors. 22. Employment and removal of Directors 22. Any remuneration so paid may be in addition to the remuneration payable in terms of Article 19. not less than 6 (six) business days before the day appointed for the meeting. there shall have been given to the Secretary notice in writing: 23. and 23. one-third of the Directors. 21. the Company in General Meeting may fill the vacated offices by electing a like number of persons to be Directors.2.2 Subject to the provisions of the Act. if. No person other than a Director retiring at the meeting shall. provided that the terms as to appointment.7 Nothing contained in this Article 21 shall be construed so as to prevent any Director who is also a Member from taking part in and voting upon all questions submitted to a General Meeting whether such Director shall be personally interested or concerned in such question or not. be selected from among them by lot.2 and 22.4 A Director may. be removed from office by a resolution signed by the majority of the other Directors. The length of time a Director has been in office shall. at the date of any annual General Meeting any Director will have held office for a period of 3 (three) years since his last election or appointment. then. within the first 2 (two) months after the Financial Year.2 be computed from the date of his last election or appointment. and so on from year to year until his place is filled. unless recommended by the Directors for election. he shall. 23. for nominations to reach the Office from any part of the Republic. 22. and may fill any other vacancies. the Company may by ordinary resolution remove any Director before the expiration of his period of office and may by ordinary resolution elect another person in his stead. after the receipt of the notice. 23.1 At the annual General Meeting held in each year.1. in the absence of agreement. before the expiration of his period of office. Rotation of Directors 23. or if their number is not a multiple of 3 (three).3 The Company shall keep at the Office a register containing the particulars of its Directors. be eligible for election to the office of Director at any General Meeting unless. provided that in determining the number of Directors to retire no account shall be taken of any Director who by reason of the provisions of Article 24.2 Retiring Directors shall be eligible for re-election.6 For the purpose of this Article 21. shall retire from office. 148 . by not less than 10 (ten) Members holding 10 % (ten percent) of the issued Capital of the intention of such Members to propose such person for election and also notice in writing signed by the person to be proposed of his willingness to be elected.2 is not subject to retirement.2 in respect of any other meeting. an alternate Director shall not be deemed to be interested in any contract or arrangement merely because the Director for whom he is an alternate is so interested.The Directors so to retire at each annual General Meeting shall be those who have been longest in office since their last election or appointment. the Directors to retire shall. As between Directors of equal seniority. the provisions of the Act shall be complied with. provided that notwithstanding anything herein contained. In electing Directors.3 Subject to the preceding Article 23.2. 23. but not less than one-third. it being recorded that it is the intention that the period to be allowed before the date of the General Meeting for the nomination of a new Director must be such to give sufficient time. unless it shall be determined at such meeting not to fill such vacancy. save in respect of Directors appointed or elected in terms of the provisions of Articles 19.4 If at any annual General Meeting at which an election of Directors ought to take place. other than that of auditor of the Company or of any subsidiary company. 22.1 A Director may be employed by or hold any office of profit in the Company or in any subsidiary of or holding company of the Company in conjunction with the office of Director. 22. he shall retire at such meeting. 23.2. if willing.4. The person so elected shall hold office during such time only as the Director in whose place he is elected would have held office. either as one of the Directors to retire in pursuance of the foregoing or additionally thereto. A retiring Director shall act as a Director throughout the meeting at which he retires.1 in respect of the annual General Meeting. continue in office until the dissolution of the annual General Meeting in the next year.

provided that such Currency Conversion Date shall be a date not earlier than the date of the declaration of the dividend and not later than the date of its payment. to that one of them first named in the Register in respect of such joint holdings. 149 .The declaration of any dividend may. and which would have the effect of changing the currency in which such payment would be made. there is no material difference between the rate/s of exchange ruling on the Currency Conversion Date and the provisional rate/s of exchange stipulated in the declaration then the currency of the Republic shall be converted at the latter rate/s.5 Dividends may be declared either free of or subject to the deduction of income tax and any other tax or duty in respect of which the Company may be chargeable. and may be sent by post to the last Registered Address requested by him. pay to the Members on account of the next forthcoming dividend such interim dividend as in their judgment the position of the Company justifies. 31.1. Dividends 30. in the opinion of the Directors.7 In case several persons are registered as the joint holders of any Shares. 30. and in particular may fix the value for distribution of such specific assets or any part thereof. Any subsequent rise or fall of rate/s of exchange determined as above shall be disregarded. in the case of joint holders. and in accordance with the provisions of the Act.4 Any dividend so declared may be paid and satisfied either wholly or in part by the distribution of specific assets. or in any one or more of such ways as the Directors may at the time of declaring the dividend determine and direct. interest or other moneys payable to the registered holder of Shares may be paid by cheque. 30. and in particular of paid-up Shares or Debentures of any other company.1 The Company in a General Meeting or the Directors may from time to time.2 All unclaimed monies payable to a Member. For the purpose of this Article 31. or in cash. then the currency of the Republic shall be converted into such other currency or currencies at the rate/s of exchange ruling on the Currency Conversion Date. but if in the opinion of the Directors there is a material difference. If. must be held by the Company in trust indefinitely until lawfully claimed by such member. Payment of Dividends 31. declare a dividend to be paid to the Members in proportion to the number of Shares held by them in each class as at the date subsequent to the date of declaration or date of confirmation of the dividend. or at the rate/s of exchange which. no notice of change of Registered Address or instructions as to payment being made at any other address which is received by the Company between the Record Date for the dividend or return of Capital and the respective date of payment of the dividend or repayment of Capital. shall become effective until after such date of payment. provide that all or any particular Members whose Registered Addresses are outside the Republic or who have given written instructions requesting payment at addresses outside the Republic shall be paid in such other currency or currencies as may be stipulated in the declaration. 31. electronic transfer or other document sent through the post either to the Registered Address of any Member or to any other address requested by him.6 The Directors may.4 All dividends that remain unclaimed for a period of 3 (three) years from the date on which such dividends became payable may be declared forfeited by the Directors for the benefit of the Company. 31. however. as the case may be (both dates inclusive).2 No larger dividend shall be declared by the Company in General Meeting than is recommended by the Directors. The declaration may also stipulate the date (hereinafter referred to as “the Currency Conversion Date”) upon which and a provisional rate of exchange at which the currency of the Republic Shall be converted into such other currency or currencies. 30. whichever is the later. any one of such persons may give effectual receipts for all dividends and payments on account of dividends in respect of such Shares. 30. electronic transfer or otherwise as the Directors may from time to time determine. from time to time.1 All dividends. Where any difficulty arises in regard to the distribution of such specific assets or any part thereof the Directors may settle the same as they think expedient. 31. other than a dividend. and the payment of such cheque or electronic transfer shall be a good discharge to the Company in respect thereof. 30.3 The Company shall not be responsible for the loss in transmission of any cheque. or. in the opinion of the Directors is/are not materially different.DIVIDENDS AND PAYMENT 30.3 Dividends shall be declared in the currency of the Republic. 30.

held by each of them. the Directors may settle the same as they think expedient. Such resolution may provide that any such sum or sums shall be set free for distribution and be appropriated to and amongst the Members either with or without deduction for income tax. no Director. insolvency or tortuous acts of any person with whom any moneys. 40.2.1 If the Company shall be wound up. unless the same happen through his own negligence or dishonesty. 150 . Secretary or other officer or servant of the Company shall be liable for the acts. damage or misfortune whatever which shall happen in the execution of the duties of his office. and such appointments shall be effective. a contract shall be entered into and filed in accordance with the Act. the Company in a General Meeting.2 Assets remaining after payment of the debts and liabilities of the Company and the costs of the liquidation shall. It shall be the duty of the Directors to pay any such costs. and the Directors may appoint any person to sign such contract on behalf of the persons entitled in the appropriation or distribution.2 Subject to the provisions of the Act. fix the value for distribution of any fully paid Shares. provided that no such distribution shall be made by the Company unless recommended by the Directors. or shall otherwise deal with such sum or sums as provided for in such resolution. 32.1 to repay the Members the amounts received on issue in respect of the Shares respectively held by each of them. whether voluntarily or otherwise. neglects or defaults of any other Director or officer or servant. the liquidators may divide among the Members in specie any part of the assets of the Company and may vest any part of the assets of the Company in trustees for the benefit of the Members upon such trusts as the liquidators shall think fit.2 Where any difficulty arises in respect of such distribution. manager. 40. and the contract may provide for the acceptance by the holders of the Shares to be allotted to them respectively in satisfaction of their claims in respect of the sum so capitalised. or any sum received by way of premium on the issue of any Shares or Debentures. make cash payments to any holders of Shares or assets in trustees upon such trusts for the persons entitled in the appropriation or distribution as may seem just and expedient to the Directors. may at any time and from time to time pass a resolution to capitalise any sum forming part of the undivided profits standing to the credit of the Company’s reserve fund. in accordance with their rights and shareholdings in such manner as the resolution may direct. securities or effects shall be deposited or for any loss or damage occasioned by any error of judgment or oversight on his part. or any sum carried to reserve as the result of a sale or revaluation of the assets of the Company or any part thereof. every Director.2 the balance (if any) shall be distributed among the Members in proportion to the number of Shares. subject to the rights of the holders of Shares (if any) issued upon special conditions. any security in or upon which any of the moneys of the Company shall be invested. or become liable to. respectively. and 39. or in relation thereto. or for any loss or damage arising from the bankruptcy. 39. or any sum in the hands of the Company and available for dividend.1 Subject to the provisions of the Act. be applied as follows: 39. for joining in any receipt or other act of conformity or for loss or expense happening to the Company through the insufficiency or deficiency of title to any property acquired by order of the Directors. Indemnity 40. and the Directors shall. receipts. by reason of any contract entered into or act or deed done by him either as such officer or servant.1 Subject to the provisions of the Act. Secretary and other officer or servant of the Company shall be indemnified by the Company against all costs. losses and expenses out of the funds of the Company. Debentures or Debenture stock.32. apply such sum or sums in paying up Shares or Debentures and appropriate such Shares or Debentures to or distribute the same amongst the holders of such Shares in accordance with their shareholding thereof respectively as aforesaid. 39. then with the sanction of a special resolution.2. or for any other loss. in accordance with such resolution. When deemed requisite. losses and expenses which any such officer or servant may incur. or the Directors. manager. or in any way in the discharge of his duties. Winding up 39. Capitalisation 32.

151 .

152 PRINTED BY INCE (PTY) LTD REF. W2CF10683 .

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