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Director Due DiligenceCorporate Governance NetworkSeptember 2013

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Contents PagePurpose of the paper 3

Terminology used in the paper 3

Introduction – Why undertake due diligence? 3

Additional matters to consider 3

Purpose of the annexures 4

Annexure A – What should the company consider about the potential director? 5

Annexure B – What should the potential director consider about the company? 7

Annexure C – JSE Schedule 21 Director’s declaration 12

Annexure D – Sample confidentiality agreement 14

The information contained in this paper is published by the Corporate Governance Network and is provided for discussion purposes only. As such, it is intended to provide the reader or his/her entity with general information of interest. The information is supplied ‘as is’ and has not been compiled to meet the reader’s or his/her entity’s individual requirements.

It is the reader’s responsibility to satisfy himself or herself that the content meets the individual’s or his/ her entity’s requirements. The information should not be regarded as professional or legal advice or the official opinion of PwC, the Institute of Directors and/or individual members.

No action should be taken on the strength of the information without obtaining professional advice. Although the Corporate Governance Network takes all reasonable steps to ensure the quality and accuracy of the information, accuracy is not guaranteed.

The Corporate Governance Network shall not be liable for any damage, loss or liability of any nature incurred directly or indirectly by whomever and resulting from any cause in connection with the information contained herein.

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Purpose of the paperThis paper aims to provide companies with a guide of what to consider before nominating a potential director onto a board and should not be considered as a checklist in deciding whether to accept a potential candidate or not.

From a potential director’s perspective, the paper aims to guide the individual on what to consider about a company prior to accepting an appointment.

Terminology used in the paperWhilst the terms “company” and “director” have been used in this paper, the guidance in the paper can be applied in principle to other types of entities and other governance office bearers. However, it is important to note that other specific requirements would need to be taken into account for different appointments like trustees/councillors, in which case the guidance would need to be tailored.

Introduction

Why undertake due diligence?From a company’s perspective, it is important to undertake a due diligence on prospective directors to ascertain whether they are suitable for consideration and should be nominated for appointment i.e. whether they have the right knowledge, skills and personal attributes to effectively fulfil their legal duties.

In doing so, the organisation should be mindful of the fact that it is unlikely that a single individual will fit the requirements perfectly. If the individual has most of the skills and attributes required and is not disqualified/ineligible, most other gaps in expectation should be manageable.

Refer to Annexure A for a guideline on what a company should consider about a potential director.

From a prospective non-executive director’s perspective, it is imperative that prior to accepting an appointment, he/she should undertake his/her own thorough examination of the company to satisfy himself/herself that it is a company in which he/she can have faith and in which he/she will be well suited to serving.

This due diligence allows the prospective director to assess the risks posed through involvement with the company, its governance procedures, financial management and strategic aims and objectives. The exercise may reveal the main areas for input requiring the non-executive director’s attention. Alternatively it may provide some idea of just how much work will be required.

Refer to Annexure B for a guideline on what a potential director should consider about a company.

By making the right enquiries, asking the right questions, and taking care to understand the replies, the risk of unpleasant surprises can be reduced and the likelihood of success dramatically increased.

Additional matters to considerStakeholder appointed directorsWith regards to stakeholder representation on boards (including board representation of empowerment partners as well as shareholder representation, where the organisation has controlling shareholders), an inherent challenge exists as these individuals are appointed by a third-party.

From the organisation’s perspective, there needs to be upfront communication with the relevant third-party to ensure that the board’s needs are taken into account when the appointment is made.

There also needs to be a mechanism whereby an organisation is able to contest a stakeholder appointed director that does not fall within the desired criteria after taking into account the questions in Annexure A.

From the individual’s perspective, there should be a mechanism whereby the nominated individual can decline the appointment after consideration of the questions in Annexure B.

Refer also to the CGN Position Paper – “Representative Directors” for further information on this subject.

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JSE listed companiesIn addition to considering the matters raised in the annexures to this paper, a JSE listed company is required to submit to the JSE and its sponsor, the relevant director’s declaration in respect of each of its appointed directors within 14 days of their appointment in the form specified in Schedule 21 of the JSE Listings Requirements. Refer to Annexure C for the JSE’s Schedule 21 form.

ConfidentialityAs the due diligence process involves the sharing of confidential information, it is recommended that both parties (i.e. the company and the prospective director) sign confidentiality/non-disclosure agreements. This allows the parties to share information with each other for the purpose of the due diligence but restricts access thereof to/by third parties. Refer to Annexure D for a sample agreement that can/should be tailored to suit the specific circumstances.

Purpose of the annexuresThe items covered in the annexures to this paper are intended as consideration or possibly discussion points when undertaking due diligences of this nature – and should not be viewed as a complete checklist or exhaustive list of any form. The items are designed to help companies reach an informed and thoughtful decision before nominating a prospective director for appointment; and to help prospective directors reach an informed and thoughtful decision before accepting or declining an offer of a board position.

The annexures are designed to cover an extensive range of possible and potential considerations that can be taken into account. It is not suggested nor intended that the considerations set out in the annexures are to function as a tick box checklist which must be exhaustively canvassed. Rather, they should be viewed as a suggested universe of considerations available to companies and individuals who should exercise their own judgement in deciding what specific considerations set out therein it/him/her views to be appropriate for application to any particular situation.

In addition to the questions listed in the annexures, the company/prospective director should also consider any other matters that they consider pertinent in coming to a decision.

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Annexure ALegal contextSection 68(1) of the Companies Act, 2008 (the Act) requires all directors (including any alternate directors) to be elected by the shareholders of profi t companies, or members of non-profi t companies that are entitled to exercise voting rights in that election. The only exception is directors appointed by persons named in the Memorandum of Incorporation (MOI), ex-offi cio directors, and where the board fi lls vacancies on a temporary basis.

A person becomes entitled to serve as a director of a company when that person has been appointed or elected in accordance with the Act and has delivered to the company a written consent to serve as its director.

Section 69 of the Act sets out certain ineligibility and disqualifi cation criteria for directors and states that:

(2) A person who is ineligible or disqualifi ed, must not- (a) be appointed or elected as a director of a company, or consent to being appointed or elected as a director; or (b) act as a director of a company.(3) A company must not knowingly permit an ineligible or disqualifi ed person to serve or act as a director.

In terms of the Act, the election or appointment of a person as a director is void if, at the time of the election or appointment, that person is ineligible or disqualifi ed.

Governance context

The key goal in selecting directors is to build a mix of skills and experience that achieves a well-rounded team in fulfi lling the board’s duties and responsibilities. King III states in principle 2.18, paragraphs 71 and 72 that

“Directors should be individuals of integrity and courage, and have the relevant knowledge, skills and experience to bring judgement to bear on the business of the company.” and “every board should consider whether its size, diversity and demographics make it eff ective. Diversity applies to academic qualifi cations, technical expertise, relevant industry knowledge, experience, nationality, age, race and gender.”The nominations committee (or if none exists, the board), should determine the nominees who will be put forward to the shareholders for election. This should be based on the assessments of the proposed candidates (CV’s, background checks and interviews) as well as the needs of the board (as covered in the questions below).

It is also important, that in putting forward the nominees to the shareholders, that the board inform the shareholders of the process that has been followed and the criteria that has been considered in getting to those decisions.

Company Due diligence Potential Director

A1 Legal and governance

# Questions to consider Reason Source

A1.1

Is the candidate allowed to serve as a director in terms of the Companies Act and/or Memorandum of incorporation ineligibility/disqualifi cation criteria?

To ensure compliance Inspection of CV background checks and enquiry at interview

A1.2 Does the candidate understand his/her role as a non-executive director?

To ascertain whether expectations will be met

Inspection of CV and enquiry at interview

A1.3Are there any potential/actual confl icts of interest between the candidate and the company?

To ascertain independence Inspection of CV background checks and enquiry at interview

A1.4 Has the candidate consented to act as a director of the company?

To ascertain willingness to serve

Enquiry

A1.5Would you consider the candidate to be independent (if this is a requirement for the position)?

To ascertain independence Inspection of CV and enquiry at interview

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A2 Knowledge, experience and personal attributes

# Questions to consider Reason Source1

A2.1 How will the candidate fit within the board culture and dynamics?

To consider suitability of personal attributes

Consideration at interview

A2.2 Does the candidate satisfy and transformation/diversity considerations for the board?

To consider transformation targets

Inspection of CV

A2.3How will the candidate make a positive contribution to the board’s knowledge and skills? Ie does the individual fill the right gap?

To consider adequacy of knowledge

Inspection of CV orconsideration at interview

A2.4Does the individual demonstrate the necessary knowledge (industry, business, finance, strategy, risk, legal, governance)?

To consider adequacy of knowledge

Inspection of CV orconsideration at interview

A2.5 What is the extent of the candidate’s experience in directorship roles?

To consider adequacy of directorship experience

Inspection of CV andenquiry at interview

A2.6

Does the candidate portray the desired personal characteristics, including integrity, honesty, curiosity, courage, teamwork, communication skills, instinct, active contributor?

To consider suitability of personal attributes

Consideration at interview

A2.7 Does the candidate portray a genuine interest in the organisation and its business?

To consider commitment Consideration at interview

1 In addition to the specific sources listed in this table, one would usually also look to informal networks (talking to people/contacts who may know the individual) to ascertain suitability to the position.

A3 Other considerations

# Questions to consider Reason Source

A3.1Could association with the candidate result in a risk to the company?

To assess reputational risk through association with an individual

Inspection of CV and enquiry in interview

A3.2

Based on his/her other commitments, does the candidate have the time to make the level of commitment required to be an effective director on the board?

To consider ability to dedicate sufficient time and effort to duties


A3.3

What strategic relationships/alliances does the candidate have that would be of value to the company?

To consider potential opportunities through association with an individual


A3.4What is the potential candidate’s fee/salary expectation and can that be met by the company?

To consider affordability Enquiry in interview

A3.5Has the company (or its agent) checked the authenticity of the candidate’s qualifications?

To provide assurance that the candidate has the appropriate qualifications

Inspection of certificates and confirmation with issuing body

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Annexure BLegal and governance contextIn terms of the Companies Act, 2008, a person becomes entitled to serve as a director of a company when that person has been appointed or elected in accordance with the Act and has delivered to the company a written consent to serve as its director.

In considering whether to consent to serve on a board, there are a number of critical matters that a potential director should take into account, as covered in Section 1 below.

During this consideration or subsequent to being appointed as a director, there are further informative matters that a director would consider in order to familiarise himself/herself with the company, as covered in Section 2 below.

Potential Director Due diligence Company

Section 1 – Critical matters to consider

# Sub-section Questions to consider Reason Source

A1.1 RiskWhat are the main risks the company faces, and how are these risks managed?

To consider how mature the risk management process is

Inspection of risk register and risk management plan

A1.2 RiskDoes the company have sound and eff ective systems of internal controls?

To consider how mature the internal control system is

Inspection of internal audit reports and/or enquiry

A1.3 Risk

Is any material litigation presently being undertaken or threatened, either by the company or against it?

To consider how this impacts the future viability of the company and whether you want to be associated with the company.

Inspection of prior integrated report and/or enquiry

A1.4 RiskWhat are the key issues facing the board?

To ascertain whether you want to become involved with this board

Inspection of board appraisal report (if any) or enquiry

A1.5 Risk

Are you aware of the potential legal liabilities as a director? Which of those are covered by D&O insurance? What is the company’s policy on indemnifying directors? Are there any outstanding/pending claims that may result in directors’ liability?

To consider the risk involved with accepting the appointment

Review of board charter and enquiry

A1.6 Financial

What is the company’s current fi nancial position and what has its fi nancial track record been over the past three years?

To ascertain the fi nancial viability of the company

Inspection of prior annual/integrated reports

A1.7 Financial

Is the company a going concern? Is there any reason to suspect or believe that the company is insolvent or heading that way?

To ascertain the fi nancial viability of the company

Inspection of prior annual fi nancial statements, going concern assessments and fi nancial forecasts

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A1.8 FinancialHas the company achieved unqualified audits over for the previous years?

To ascertain the quality of the company’s financial function.

Inspection of prior signed financial statements

A1.9 FinancialHave previous audit reports revealed any issues/concerns about the company?

To ascertain any major concerns about the company

Inspection of prior signed financial statements

A1.10 Financial

Are non-executive directors paid?If so, how much, how often, on what basis? Have you considered your possible annual tax burden given that your current earnings need to be combined with your new earnings?

To consider the personal financial impact of the appointment

Review of board charterenquiry consideration

A1.11 Board composition

What is the current composition of the board? Who are the executives and non-executives? What is their background and how long have they served?

To gain an understanding of the current board and consider how well you would fill the gaps

Inspection of integrated report / website or enquiry


Is there a range of skills on the board and are those skills and experiences aligned to the company’s strategic objectives?


Inspection of board appraisal report and enquiry


Is the board composition suitably diverse to stimulate independent challenge and thought?




How has the board composition changed over the last few years? If there was a resignation, what was the reason (resignation/retirement/removal)?

To consider the company’s relationship with its directors.

Enquiry


Is there a suitably qualified company secretary supporting the board? Is there adequate internal support of the non-executives?

To gain an understanding of how sufficiently the board is supported

Inspection of board charter


What is the CEO’s relationship with the board? What is her/his performance review mechanism?

To ensure healthy tensions exist between the board and the executive



Are non-executives kept up to date of significant happenings between board meetings? What are the internal protocols for non-executive directors to obtain access to information?

To ascertain access to information for non-executives

Enquiry and inspection of board charter


Which board committees have been established and which would you be required to serve on?

To gain an understanding of how the board operates as well as the expectations of a potential director

Inspection of board charter and enquiry

A1.19 Board meetings

Where and how often are board meetings held? How long does a typical board meeting last?

To consider whether you would be able to make this time commitment

Inspection of board charter and enquiry


Does the board hold an annual strategy session?

To consider whether you would be able to make this time commitment

Enquiry

Section 1 – Critical matters to consider (continued...)

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A1.21 Desire

Is there anything about the nature and extent of the company’s business activities that would cause you concern both in terms of risk and any personal ethical considerations?

To identify the reputational risk of associating with the company.

Consideration

A1.22 DesireIf the company is not performing particularly well is there potential to turn it around?

To ascertain whether you have the time, desire and capability to make a positive impact.

Consideration

A1.23 Desire

Is this a good career move? Will you grow in terms of experience and/or ability as a result of joining the board?

To consider whether the appointment would make sense from a career progression perspective

Consideration

A1.24 SuitabilityAre you being brought onto the board to bolster an existing group, or to bring something new?

To ascertain expectations and whether you are able to fulfil those expectations

Inspection of Nomco minutes, previous board appraisal report and enquiry

A1.25 Suitability

What is the total time commitment required? Could you find the time to deal with emergency situations? Which other events would you be required to attend? What site visits would you be required to make?

To ascertain whether you are able to make the time commitment required to adequately fulfil the responsibility

Consideration

A1.26 Suitability

Would accepting the directorship put you in a position of having a conflict of interest?

To consider whether you would be independent

Consideration

Section 1 – Critical matters to consider (continued...)

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Section 2 – Informative matters to consider


A2.1 BackgroundWhat is the legal status of the company?

To obtain a basic understanding of the company

Inspection of prior integrated report / website

A2.2 Background What is the company’s history? To obtain a basic understanding of the company


A2.3 BackgroundWhat is the nature and extent of the company’s business activities?



A2.4 BackgroundWhat are the company’s vision, mission and values as set by the board?



A2.5 BackgroundWhat are the company’s strategy and current business plan?

To obtain a basic understanding of the company’s strategy


A2.6 BackgroundWhat is the company’s group structure, if any?

To obtain a basic understanding of structure in which the company operates


A2.7 Background What are the company’s key dependencies?

To obtain an understanding of what the company relies on


A2.8 Stakeholders Who are the major shareholders of the company?



A2.9 Stakeholders

Who are the company’s major stakeholders?

To obtain an understanding of who the major stakeholders are and how this impacts the company


A2.10 StakeholdersDoes the company have an effective stakeholder communications policy?

To ascertain how well the company communicates with its stakeholders

Inspection of prior integrated report / website or enquiry

A2.11 Stakeholders

If the company operates in a regulated sector, who are the regulators and what is the relationship with the regulators like?

To consider the company’s regulatory standing


A2.12 Stakeholders Who are the company’s major competitors?

To consider how well the company is doing in its market

Enquiry

A2.13 Stakeholders

What is the company’s competitive position and market share in its main business areas?

To consider how well the company is doing in its market

Inspection of prior integrated report / website/marketing reports or enquiry

A2.14 Financial

Has the company issued an integrated report?

To ascertain the company’s attitude towards sustainability and integrated strategy and reporting.

Inspection of prior integrated reports and enquiry

A2.15 Financial

Who are the company’s auditors? How long have they served? And if there has been a recent change, why?

To ascertain auditor independence and he company’s relationship with its auditors.

Enquiry

A2.16 GovernanceDoes the company apply King III or any other governance guidelines?

To ascertain the company’s attitude towards corporate governance

Inspection of website/integrated report.

A2.17 Governance

Have you reviewed board policies including board charter, board code of conduct, conflicts of interest policy, induction policy, chair role description, director development policy, board effectiveness evaluation policy, delegations of authority?

To understand the powers and expectations of a director of the company and the implications of board related documents/policies

Inspection of the relevant documents mentioned

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A2.18 Governance

Are the board, its committees and individual directors evaluated annually and are action plans put in place to address areas of weakness?

To ascertain the boards stance towards continual improvement

Inspection of board charter and previous board appraisal report

A2.19 Governance

Are you aware of where and how to get advice if you have concerns regarding corporate governance matters?

To enable awareness Inspection of board charter or enquiry

A2.20 Governance

Does the company offer a suitable director induction programme and adequate ongoing professional development? Is it clear from the company how you will acquire an understanding of the business activity?

To ascertain the company’s commitment to director development

Review of board charter/induction programmes and enquiry


What is attendance and participation at board meetings like?

To consider the commitment of the current board members

Inspection of board minutes and enquiry


How focused and complete is the board agenda?

To ascertain the boards effectiveness through meaningful agendas

Inspection of previous board agendas and enquiry


How far in advance of meetings are board packs sent out?Are board packs sufficiently detailed and well presented?

To ascertain how well the secretariat function supports the board by enabling the board members to fully prepare for meetings

Inspection of board charter/board packs and enquiry


Is there an annual work plan and how comprehensive is it?

To consider how the board ensures that it fulfils its responsibilities

Review of annual work plan and enquiry


Do board minutes have the right level of detail?

To consider how well the secretariat function supports the board

Review of board minutes

Section 2 – Informative matters to consider (continued...)

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Annexure CSCHEDULE 21 Directors declaration This director’s declaration must be provided in letter format addressed to the JSE in accordance with the JSE’s Listings Requirements.

Personal details

1 Applicant issuer and effective date of appointment: . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

2. Surname of Director: . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

3. Any former surname: . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

4. First name: . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

5. Identity number: . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

6. Director function and capacity in terms of paragraph 3.84(f): . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

7. Physical address: . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

8. Postal address: . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

9. Telephone number (business): . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

10. Fax no.: . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

11. E-mail address: . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Qualifications and experience 12. Are you a director, or alternate director of any other company that is publicly listed or traded, or a partner in any partnership? If so, state the name of any such company or partnership, the nature of business where this is not indicated in the title, and the date you became a director or partner.

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13. Provide details of your qualifications and relevant experience as required in terms of Section 7.B of the

Listings Requirements.

Qualifications: . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

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Experience: . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

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14. Have you ever 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 as described in section 7.B of the Listings Requirements? If so, give full particulars.

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15. Are you being appointed as a director of an ALTx company? If yes please confirm whether you have attended the ALTx Directors Induction Programme?

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Integrity

16. Have you ever been convicted of any offence resulting from dishonesty, fraud, theft, forgery, perjury, misrepresentation or embezzlement? If yes, provide details.

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17. Has any company been put into liquidation or been placed under business rescue proceedings or had an administrator or other executor appointed during the period when you were (or within the preceding 12 months had been) one of its directors, or alternate directors or equivalent position? If yes, provide details.

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18. Have you ever been adjudged bankrupt or sequestrated in any jurisdiction? If yes, provide details.

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

19. Have you at any time been a party to a scheme of arrangement or made any other form of compromise with your creditors? If yes, provide details.

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

20. Have you ever been found guilty in disciplinary proceedings, by an employer or regulatory body, due to dishonest activities? If yes, provide details.

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

21. Have you ever been barred from entry into any profession or occupation? If yes, provide details.

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

22. Have you at any time or has a company of which you were a director or alternate director or officer at the time of the offence, been convicted in any jurisdiction of any criminal offence, or an offence under legislation relating to the Companies Act. All such convictions must be disclosed even though they may now be “spent convictions”.

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

23. Have you ever been removed from an office of trust, on the grounds of misconduct, involving dishonesty? If so, give full particulars.

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

24 Has any court granted an order declaring you to be delinquent or placed you under probation in terms of Section 162 of the Act and/or Section 47 of the Close Corporations Act, 1984 (Act No. 69 of 1984)? If so, give full particulars.

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

I . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . director of . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (name of company)

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (the “issuer”) declare that to the best of my knowledge and belief (having taken all reasonable care to ensure that such is the case) the answers to all the above questions are true, and I hereby give my authority to the JSE to disclose any of the foregoing particulars as the JSE may, in its absolute discretion think fit.

I also acknowledge that . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (name of company), of which I am a director has agreed to be bound by and to comply with the JSE’s Listings Requirements, as amended from time to time, and, in my capacity as a director, I undertake and agree to discharge my duties in ensuring such compliance whilst I am a director. The delegation of any of my duties to any sub-committee or anyone else will not absolve me of my duties and responsibilities in terms of the Listings Requirements.

I further acknowledge that certain requirements contained in the JSE’s Listings Requirements, as amended from time to time, affect me directly as a director and, in my personal capacity, as well as in my capacity as a director, I undertake to be bound by and to comply with all such requirements whilst I am a director.

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14

Annexure DSample Confidentiality AgreementIt is understood and agreed to that the below parties will provide and receive certain information during the director appointment due diligence process that is and must be kept confidential. To ensure the protection of such information, it is agreed that:

1. The confidential information includes, inter alia:

•Relevantpersonalinformationaboutapotentialdirector •Business,financial,governanceandotherrelevantinformationaboutthecompany

2. The parties agree not to disclose the confidential information obtained to anyone unless required to do so by law.

3. This Agreement records the entire agreement between the parties concerning the disclosure of Confidential Information. Any addition or modification to this Agreement must be made in writing and signed by the parties.

4. If any of the provisions of this Agreement are found to be unenforceable, the remainder shall be enforced as fully as possible and the unenforceable provision(s) shall be deemed modified to the limited extent required to permit enforcement of the Agreement as a whole.

WHEREFORE, the parties acknowledge that they have read and understand this Agreement and voluntarily accept the duties and obligations set forth herein.

Signed by the parties:

Name: . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Capacity: . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .On behalf of [insert company name]

Signature: . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Date: . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Name: . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Potential non-executive director: . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Signature: . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Date: . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

15

Notes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 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16

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