THIS DOCUMENT IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION

Transcription

1 THIS DOCUMENT IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION If you are in any doubt as to the action you should take in relation to this notice, please consult your Central Securities Depository Participant ( CSDP ), stockbroker, banker, attorney, accountant or other professional adviser immediately. Action required Shareholders are referred to page 1 of this notice which sets out the detailed action required by both certificated and dematerialised shareholders. (Incorporated in the Republic of South Africa) (Registration number 1999/025903/06) Ordinary share code: CPI ISIN: ZAE Preference share code: CPIP ISIN: ZAE ( Capitec or the company ) Notice is hereby given that: 1. the annual general meeting ( AGM ) of the shareholders of Capitec will be held in the Auditorium, the Conference Centre, Spier, R310, Stellenbosch on Friday, 1 June 2012, at 12:00 to transact the business as set out in this notice of the AGM; and 2. a general meeting of holders of non-redeemable, non-cumulative, non-participating preference shares ( preference shares ) will be held in the Reynolds Room, Manor House, the Conference Centre, Spier, R310, Stellenbosch on 1 June 2012 at 11:15 to consider the proposed amendments to the terms and conditions of the preference shares as set out in this notice of the general meeting. Corporate adviser and sponsor Transfer secretaries Date of issue: 2 May 2012 This notice is available in English only. A copy of this notice is available on the website at from 2 May 2012.

2 INDEX Page no. Notice of annual general meeting 1 Who may attend the vote 1 Purpose of the meeting Presentation of audited annual financial statements Presentation by the social and ethics committee 1 Ordinary resolutions Rotation of current directors: MS du P le Roux CA Otto PJ Mouton Appointment of new director JD McKenzie Reappointment of auditors Auditors fee Placement of unissued shares under authority of directors general issues Placement of unissued shares under authority of directors share option scheme Issues for cash general authority Non-binding endorsement of the remuneration policy 3 Special resolutions Approval of directors fees Approval to increase share capital Approval to amend the memorandum of incorporation to reflect the new authorised share capital Approval of terms and conditions attaching the new class of preference shares Adoption of new memorandum of incorporation General authority to company to repurchase its shares General authority to subsidiaries to repurchase shares Financial assistance Authority to grant options in terms of the company s approved employee share incentive scheme Other business 10 Voting 10 Annexures Annexure A Summarised financial results for the year ended 29 February Annexure B Summary CVs of directors and executive managers 18 Annexure C Additional information required in terms of the JSE Limited Listings Requirements in respect of special resolutions 3 and 4 21 Annexure D Participation at the AGM via electronic communication 27 Proxy form 29 Instructions and notes to the form of proxy 30 Notice of a general meeting of holders of non-redeemable, non-cumulative, non-participating preference shares 31 Who may attend and vote 31 Purpose of the meeting 31 Special resolutions 1. Approval to replace existing clause of the terms and conditions of the non-redeemable, non-cumulative, non-participating preference shares with a new clause Approval to replace existing clause of the terms and conditions of the non-redeemable, non-cumulative, non-participating preference shares with a new clause Other business 32 Annexure I Participation at the general meeting via electronic communication 33 Proxy form 35 Instructions and notes to the form of proxy 36

3 Capitec Bank Holdings Limited (Incorporated in the Republic of South Africa) (Registration number 1999/025903/06) ( Capitec or the company ) (JSE share code: CPI ISIN: ZAE ) Notice of annual general meeting Notice is hereby given that the annual general meeting ( AGM ) of the shareholders of Capitec will be held in the Auditorium, the Conference Centre, Spier, R310, Stellenbosch on Friday, 1 June 2012, at 12:00 to transact the business as set out in this notice of the AGM. WHO MAY ATTEND AND VOTE? A. If you are the registered holder of certificated shares or if you hold dematerialised shares which are registered in your name: You may attend the AGM in person. Alternatively, you may appoint one or more proxies, who need not be a member(s) of the company, to attend, speak and vote in your stead at the AGM by completing the attached form of proxy in accordance with the instructions it contains. The completed form of proxy must be returned to the transfer secretaries to be received by no later than 12:00 on Wednesday, 30 May Your attention is also drawn to the rights established by section 58 of the Companies Act 2008 (Act 71 of 2008), as amended ( the Act ), as may be applicable, set out on the attached form of proxy. The form of proxy may be delivered at or posted to the company s transfer secretaries, Computershare Investor Services (Pty) Limited, 70 Marshall Street, Johannesburg, 2001 (PO Box 61051, Marshalltown, 2107). Completion of a form of proxy will not preclude such shareholder from attending and voting (in preference to that shareholder s proxy) at the AGM. B. If you hold dematerialised shares through a Central Securities Depository Participant ( CSDP ) or stockbroker, in which case the shares are not registered in your name: And you wish to attend the AGM, you must obtain a letter of representation from your CSDP or stockbroker. And you do not wish to attend the AGM but would like your vote to be recorded at the meeting, you should contact your CSDP or stockbroker and furnish them with your voting instructions. You must not complete the attached form of proxy. Beneficial owners must verify with the relevant CSDP or stockbroker the cut-off time to lodge such voting instruction. The date on which shareholders must be recorded as such in the register maintained by the transfer secretaries of the company for purposes of being entitled to receive this notice is Friday, 20 April 2012 ( Notice Record Date ). The date on which shareholders must be recorded as such in the register maintained by the transfer secretaries of the company for purposes of being entitled to attend and vote at this meeting is Friday, 25 May 2012 ( Voting Record Date ), with the last day to trade being Friday, 18 May Meeting participants may be required to provide identification to the reasonable satisfaction of the chairman of the meeting. Note: (i) Unless specifically stated otherwise, when shareholders are referred in this notice of AGM to the integrated report, the said integrated report refers to the 2012 integrated report containing the complete annual financial statements of the company and group for the financial year ended 29 February The said integrated report can be: 1. accessed on the internet at relations/financial results/integrated annual reports; or 2. obtained free of charge by requesting same from the company secretary at enquiries@capitecbank.co.za or attention: The company secretary, Capitec Bank Limited, PO Box 12451, Die Boord, Stellenbosch, 7613; or 3. in the case of shareholders who have requested to receive the integrated report, it is distributed together with this notice of the AGM. (ii) For avoidance of any doubt, the memorandum and articles of association of the company have been renamed memorandum of incorporation in accordance with the Act. (iii) Electronic participation in the AGM Shareholders or their proxies may participate in the meeting by way of telephone conference call. A total of 20 telecommunication lines will be available for such participation. Shareholders or their proxies who wish to participate in the AGM via the teleconference facility must follow the instructions on Annexure D attached to this notice of AGM. Shareholders who wish to participate in the meeting by phoning in must note that they will not be able to vote during the meeting. Such shareholders, should they wish to have their vote counted at the meeting, must in accordance with A and B above, to the extent applicable: (i) complete the proxy form as set out in paragraph A above; or (ii) contact their CSDP or stockbroker as set out in paragraph B above. PURPOSE OF THE MEETING The purpose of this meeting is to transact the business set out below. 1.1 Presentation in terms of the Act, of the: audited annual financial statements, including the directors report; and report of the audit committee, of the company and the group, being Capitec and its subsidiaries, for the year ended 29 February Note: Please refer to the summarised form of the financial statements attached hereto as Annexure A. Also refer to pages 109 and 111 of the integrated report for the audit committee and directors reports. 1.2 Presentation in terms of the Act, by the chairman of the social and ethics committee of the matters over which it presides. 1

4 2. To consider and, if deemed fit, approve the following ordinary resolutions with or without modification: Note: For any of the ordinary resolutions numbers 2.1 to 2.6 and 2.8 to be adopted, more than 50% of the voting rights exercised on each individual resolution must be exercised in favour thereof. 2.1 Ordinary resolution number 1 Resolved that each of the following directors who retire by rotation in terms of article 77.1 of the memorandum of incorporation of the company and, being eligible, offer themselves for re-election, be re-elected by separate vote as non-executive directors of the company: Michiel Scholtz du Pré le Roux Chris Adriaan Otto Petrus Johannes Mouton Summary curricula vitae of the non-executive directors listed under ordinary resolution number 2.1 above are included in Annexure B on page 18 of this notice of the AGM. The directors affairs committee has reviewed the composition of the board and has determined that the board represents an appropriate mix of skill and experience. Taking into account the past performance of and contributions made by the directors listed under items to above, it is recommended that they be re-appointed to the board. The reason for this ordinary resolution is that the memorandum of incorporation of the company requires that a third of the nonexecutive directors rotate annually at the AGM. 2.2 Ordinary resolution number 2 Resolved that John David McKenzie, appointed to the board of the company on 1 March 2012, having retired in terms of article of the company s memorandum of incorporation and being eligible, has offered himself for re-election, be re-elected as an independent non-executive director of the company. A summary curriculum vitae of Mr McKenzie is included in Annexure B on page 18 of this notice of the AGM. The reason for this ordinary resolution is that the memorandum of incorporation requires that new directors that have been appointed by the board, retire at the following AGM of the company. This is also in line with the Act which requires that at least 50% of directors be appointed by the shareholders. The appointment of Mr McKenzie will enhance the mixture of business skills and experience available to the company taking into account the nature and complexity of the business of a bank controlling company. It will also facilitate compliance with corporate governance requirements such as the balance of non-executive and independent directors on the board. 2.3 Ordinary resolution number 3 Resolved that Messrs PricewaterhouseCoopers Inc. be reappointed as auditors of the company to hold office until the conclusion of the next AGM of the company. The reason for this ordinary resolution is that the company, being a public, listed company, must have its financial results audited. Refer to page 79 of the integrated report where matters relating to the external auditor are dealt with. 2.4 Ordinary resolution number 4 In terms of the memorandum of incorporation of the company, it is herewith resolved that the authority of the audit committee to determine the remuneration of the auditors be confirmed. The reason for this ordinary resolution follows from the fact that although the Act specifies that the audit committee is required to determine the remuneration of the auditors, the current memorandum of incorporation of the company requires that the remuneration of the auditors be dealt with at the AGM. Details of fees paid to the external auditor are included in note 22 to the annual financial statements on page 149 of the integrated report. 2.5 Ordinary resolution number 5 Resolved that the unissued ordinary shares in the authorised ordinary share capital of the company, limited to 5% (1) of the issued ordinary share capital of the company, save to the extent that a rights issue may be undertaken by the company, in which case the 5% limitation will not apply, and all the non-redeemable, non-cumulative, non-participating preference shares ( preference shares ) in the authorised but unissued preference share capital of the company be placed under the control of the directors; until the next AGM of the company; and that they be hereby authorised to allot and issue any such shares as they may deem fit, subject to the Act, the memorandum of incorporation of the company and the Listings Requirements of the JSE Limited. Note: (1) At the time of finalising this notice of the AGM, 5% of the issued ordinary share capital amounted to ordinary shares. The reason for this ordinary resolution is that the board requires authority to issue ordinary and/or preference shares from time to time as may be required, inter alia, as part of Capitec s fund raising exercises and to maintain a healthy capital adequacy ratio. 2.6 Ordinary resolution number 6 Resolved that of the unissued ordinary shares in the authorised ordinary share capital of the company, in addition to the number of unissued ordinary shares referred to in ordinary resolution number 5 above, be placed under the control of the directors until the next AGM of the company; and that they be hereby authorised to allot and issue any such shares for purposes of the share option scheme of the company governed in terms of the Capitec Bank Holdings Share Trust deed, as they may deem fit, subject to the Act, the memorandum of incorporation of the company and the Listings Requirements of the JSE Limited. 2

5 The reason for this ordinary resolution is that the board requires authority to issue ordinary shares as may be required when participants in the share option scheme of Capitec Bank exercise options granted to subscribe for ordinary Capitec shares in terms of the Capitec Bank Holdings Share Trust ( the share option scheme ), the terms of which have been approved by shareholders at a general meeting held on 7 February 2002, and amendments thereto, on 2 June Ordinary resolution number 7 Resolved that, subject to ordinary resolution number 5 being approved, the directors be hereby authorised as a general approval to allot and issue ordinary shares and options or convertible securities that are convertible into an existing class of equity securities for cash without restriction, as they may deem fit, subject to compliance with the Act, the memorandum of incorporation of the company and the Listings Requirements of the JSE Limited ( JSE ), provided that: This general approval shall expire at the date of the company s next AGM in 2013 or 1 September 2013, whichever is the earlier; Any such issue will be securities of a class already in issue, or limited to such securities or rights that are convertible into a class already in issue; The securities will be issued only to public shareholders as defined in the Listings Requirements of the JSE and not to related parties; During the period permitted in terms of this general approval: the general issues of securities of a specific class will, in any financial year not exceed, in the aggregate, 5% of the company s issued share capital in that class at the date of the first such issue, it being recorded that ordinary shares issued in terms of ordinary resolution number 6 above will not diminish the number of ordinary shares that may comprise the 5% of ordinary shares that can be issued as contemplated in ordinary resolution number 5 above and this ordinary resolution number 7. the securities of a particular class will be aggregated with the securities that are compulsorily convertible into securities of that class and, in the case of the issue of compulsorily convertible securities, aggregated with the securities of that class into which they are compulsorily convertible; the number of securities which may be issued, shall be based on the number of securities of that class in issue, added to those that may be issued in future at the date of such application; (1) less any securities of the class issued or to be issued in future arising from options/convertible securities issued during the current financial year; (2) plus any securities of that class to be issued pursuant to: (i) a rights issue (which has been announced, is irrevocable and is fully underwritten); or (ii) acquisitions (which has had final terms announced) which may be included as though they were securities in issue at the date of application; and In determining the price at which an issue of equity securities may be made in terms of this general authority, the maximum discount permitted will be 10% of the weighted average traded price of the equity securities as measured over the 30 business days prior to the date that the price of the issue is agreed between the company and the party subscribing for the securities. The JSE will be consulted for a ruling if the company s securities have not traded in such 30 business day period. Note: For this resolution to be adopted at least 75% of the equity security holders present in person or by proxy at the AGM of the company must cast their vote in favour of this ordinary resolution. The reason for this ordinary resolution is that the board requires authority to issue ordinary shares for cash as may be required as part of Capitec s normal fund raising exercises and to maintain a healthy capital adequacy ratio. 2.8 Ordinary resolution number 8 non-binding endorsement of the remuneration policy Resolved, in line with good corporate governance practice, that the remuneration policy of the group (excluding the directors fees paid to the non-executive directors for their services as directors and members of board committees) and its implementation as set out in the remuneration report on page 50 of the integrated report, be endorsed. The reason for this resolution is to obtain an advisory vote of shareholders on the remuneration policy of the group. The vote enables the board to gain insight into shareholders views on the remuneration policy adopted by the remuneration committee of the group. The vote will, however, be non-binding on the company. 3. To consider and, if deemed fit, approve the following special resolutions with or without modification: Note: For any of the special resolutions numbers 3.1 to 3.9 to be adopted, at least 75% of the voting rights exercised on each individual resolution must be exercised in favour thereof. 3.1 Special resolution number 1 Resolved, to the extent applicable in terms of section 66(9) of the Act, that non-executive directors of the company be paid fees for services rendered as directors of Capitec and Capitec Bank during the financial year ending on 28 February 2013, in accordance with the scale of remuneration as set out below: Chairman of the board* R Board membership** R Chairman of a board committee** R Committee membership** R * The chairman of the board is paid a retainer as chairman of the board and receives no further payment for membership of committees. ** Non-executive directors receive a retainer fee per membership of the board and each of the board committees. No fee is paid in respect of the directors affairs committee. Note: Executive directors are not remunerated for their services as directors of the company or its subsidiaries. 3

6 The reason for this special resolution is to obtain the approval of shareholders for the non-executive directors fees recommended by the human resources and remuneration committee of Capitec and Capitec Bank. Non-executive directors of Capitec and Capitec Bank are paid a fee for their services as directors of the two companies. It is a fixed fee paid at the end of August and February in each year of service. The fee is not dependent on attendance of board and board committee meetings and is determined by the human resources and remuneration committee and approved by the full board. The fee is adjusted on an annual basis. The non-executive directors fees for the financial year ended on 29 February 2012 is set out in Annexure C on pages 23 and 24 of this notice of AGM. The Act requires that non-executive directors fees be authorised by shareholders by way of a special resolution. Executive directors receive remuneration for services as employees of Capitec Bank; no fees are paid to them for their services as directors of any of the companies in the Capitec group. The remuneration policy of Capitec Bank is set out on pages 50 to 55 of the integrated report and the remuneration paid to the executive directors for the financial year ended on 29 February 2012 in Annexure C on pages 21 to 24 of this notice of the AGM. The effect of this special resolution is that the company will be able to pay non-executive directors for their services rendered as directors of the company. 3.2 Special resolution number 2 Resolved that, in terms of section 36(2) of the Act and article 29.1 of the memorandum of incorporation, the authorised share capital of the company be and is hereby increased from R (six million rand) to R (seven million rand) by the creation of (one hundred million) compulsorily convertible or written-off non-redeemable, non-cumulative, nonparticipating preference shares of R0.01 (one cent) each, the terms and conditions of which are set out in Addendum I to the memorandum of incorporation of the company, to be adopted in terms of special resolution number 4 below. The reason for this special resolution is to increase the authorised share capital of the company to R by the creation of compulsorily convertible or written-off non-redeemable, non-cumulative, non-participating preference shares of R0.01 ( the compulsorily convertible preference shares ) to provide for a new class of preference shares the terms and conditions of which comply with the loss absorbency requirements under Basel III. Worldwide, banking regulators are moving away from a pure liquidation regime to a rescue and resolution regime. Loss absorbency requires the preference shares to either be written off or converted to ordinary equity prior to a public sector injection of capital in the event that a bank is rescued. This gives the banking regulator an additional bank rescue option. Shareholders must note that the compulsorily convertible preference shares will automatically convert to ordinary shares or automatically be written of, at the election of the South African Reserve Bank (or other relevant authority) upon a trigger event as explained in clause of the terms and conditions set out in special resolution 4 below, and no prior shareholder approval will be obtained as required in terms of the memorandum of incorporation of the company for the conversion of such preference shares into ordinary shares. The effect of this special resolution is that the authorised share capital of the company will be increased to R through the creation of compulsorily convertible preference shares of R0.01 each. 3.3 Special resolution number 3 Resolved that, in terms of section 36(2) of the Act, section 56(1)(a) of the Banks Act, 1990 (Act 94 of 1990) and subject to the passing of special resolution number 2, the memorandum of incorporation of the company be and is hereby amended by the deletion of the entire paragraph 8(a) and the substitution thereof with the following new paragraph 8(a): 8(a) Par value: The share capital of the company is R (seven million rand) divided into: (five hundred million) ordinary shares with a par value of R0.01 (one cent) each; (one hundred million) non-redeemable, non-cumulative, non-participating preference shares of R0.01 (one cent) each; and (one hundred million) compulsorily convertible or written-off non-redeemable, non-cumulative, non-participating preference shares of R0.01 (one cent) each. The reason for and effect of this resolution are as set out under special resolution number Special resolution number 4 Resolved that, subject to the passing and registration of special resolutions number 2 and 3 above, the company s memorandum of incorporation be and is hereby amended by inserting the following new Addendum I as follows: terms AND CONDITIONS OF THE COMPULSORILY CONVERTIBLE OR WRITTEN-OFF NON-REDEEMABLE, NON- CUMULATIVE, NON-PARTICIPATING PREFERENCE SHARES THE PROCEEDS OF WHICH WILL RANK AS PRIMARY SHARE CAPITAL UNDER THE BANKS ACT, 1990 AND ADDITIONAL TIER 1 CAPITAL AS CONTEMPLATED IN THE BASEL III FRAMEWORK 1. General The following terms shall attach to the compulsorily convertible or written-off non-redeemable, non-cumulative, non-participating preference shares of R0.01 each in the share capital of the company: 1.1 For purposes of this Schedule Additional Tier 1 Capital has the meaning given to such expression in the Basel III Framework; 4

7 1.1.2 Banks Act means the Banks Act, 1990; Basel III Framework means the document entitled Basel Committee on Banking Supervision Basel III: A global regulatory framework for more resilient banks and banking systems December 2010 (rev June 2011) published by the Bank for International Settlements; business day means any day other than a Saturday, Sunday or statutory public holiday in the Republic of South Africa; Capital Regulations means any legislation, regulations, requirements, guidelines and policies relating to capital adequacy in effect in South Africa in relation to banks registered under the Banks Act and licensed to conduct the business of a bank in South Africa (including, without limitation, any amendments made to the Banks Act pursuant to the Basel III Framework); Conversion means the conversion of the preference shares into Ordinary Conversion Shares in accordance with clause 3; Conversion Price means, in relation to each Ordinary Conversion Share, the volume weighted average price of one ordinary share of the company for the 30 (thirty) business days ending on and including the business day preceding the trigger event date, as published by the JSE; deemed value means the deemed value of each preference share for purposes of calculating the preference dividend, being an amount determined by the directors at the time of allotment and issue of the first preference shares, notwithstanding the actual issue price of a preference share (that is the nominal value of the preference share plus a premium thereon) which may vary because of a difference in the premium at which the preference shares may be issued from time to time; Holder means the holder of preference share/s as recorded in the company s register of shareholders; Income Tax Act means the Income Tax Act, 1962 (Act 58 of 1962), as amended or substituted from time to time; issue price means the actual issue price of each preference share, being the par value of a preference share plus the premium at which a preference share is allotted and issued; JSE means the JSE Limited (registration number 2005/022939/06), licensed as an exchange in terms of the Securities Services Act, 2004; Ordinary Conversion Shares means ordinary shares to be issued by the company to a Holder pursuant to a Conversion and which ordinary shares will be fully paid up and will rank pari passu in all respects with the fully paid ordinary shares in issue on the Trigger Event Date; preference dividend means a non-cumulative, non-participating, preference cash dividend calculated in accordance with this Schedule 3; preference dividend calculation date means the last day of February and 31 August of each year; preference dividend payment date means a date at least 5 (five) business days prior to the date on which the company pays its ordinary dividend, if any, in respect of the same period, but in any event the preference dividend shall be payable not later than 120 (one hundred and twenty) business days after the last day of February and 31 August, respectively; preference dividend rate means, subject to clause below, a rate determined by the directors at the time of allotment and issue of the first preference shares, which will not exceed the prime rate; preference shares means the compulsorily convertible or written-off non-redeemable, non-cumulative, nonparticipating preference shares of R0.01 each in the share capital of the company; Preference Share Amount means, in relation to one preference share, the issue price of that preference share; Primary Share Capital means primary share capital as defined in the Banks Act; prime rate means the publicly quoted basic rate of interest expressed as a percentage per year, compounded monthly in arrear and calculated on a 365 (three hundred and sixty five)-day year factor (irrespective of whether or not the year is a leap year) from time to time quoted by the corporate bankers of the Capitec group as being its prime overdraft rate as certified by any manager of such bank, whose appointment and/or designation need not be proved. A certificate from any manager of the bank concerned as to the prime rate at any time shall constitute prima facie proof thereof; Registrar of Banks means the Registrar of Banks contemplated in the Banks Act; Relevant Authority means the Registrar of Banks or such other governmental authority in South Africa as has (or will have) the responsibility, for purposes of and/or as contemplated in the Basel III Framework, of making decisions relating to the declaration of a bank as being non-viable, with the effect of triggering loss absorption within the relevant capital instruments (including compulsorily convertible non-redeemable non-cumulative preference shares) issued by that bank; 5

8 Trigger Event means the earlier of: a decision that a write-off of the preference shares, without which the company would become non-viable, is necessary, as determined by the Relevant Authority; and a decision to make a public sector injection of capital into the company, or equivalent support, without which the company would become non-viable, as determined by the Relevant Authority; Trigger Event Date means the date on which the Relevant Authority notifies the company (i) of the occurrence of a Trigger Event and (ii) that the preference shares must be converted into ordinary shares (as contemplated in clause 3) or that the preference shares must be written off (as contemplated in clause 4), as the case may be; 1.2 The following are the rights, privileges, restrictions and conditions which attach to the preference shares: The issue price for each tranche of preference shares to be issued will be determined by the directors at the time of allotment thereof Each preference share will rank as regards dividends and a repayment of capital on the winding-up of the company prior to the ordinary shares, and any other class of shares in the capital of the company not ranking prior to or pari passu with the preference shares. The preference shares shall confer on the Holders, on a per preference share and equal basis, the right to a return of capital on the winding-up of the company of an amount equal to the aggregate of the par value and premium of the preference shares then in issue, divided by the total number of preference shares in issue in priority to any payment in respect of any other class of shares in the capital of the company not ranking prior to or pari passu with the preference shares Each preference share will confer upon the Holder thereof the right to receive out of the profits of the company which it shall determine to distribute, in priority to any payment of dividends to the Holders of any other class of shares in the capital of the company not ranking prior to or pari passu with the preference shares, the preference dividend calculated in terms of clause below The preference dividend shall be calculated: by multiplying the deemed value of the preference shares by the applicable preference dividend rate applicable on the preference dividend calculation date (determined on a 365-day year factor, irrespective of whether the year is a leap year or not), on a daily basis, in arrear, but never compounded, for the appropriate period referred to in clause below; and from the date following a preference dividend calculation date until and including the preference dividend calculation date immediately following as if the shares have been in issue from the date following the previous preference dividend calculation date, regardless of the date of issue The preference dividend shall, if declared: accrue on the preference dividend calculation date, calculated in accordance with clause above; be payable on the preference dividend payment date; and failing payment by the relevant preference dividend payment date, considered to be in arrear If a preference dividend is not declared by the company in respect of the period to which such preference dividend calculation date relates, the preference dividend will not accumulate and will accordingly never become due to the Holders of the preference shares and payable by the company whether in preference to payments to any other class of shares in the company or otherwise If, in terms of Part VIII of the Income Tax Act, or any amendment thereto, the dividends tax contemplated in that Part VIII is or become applicable to the preference dividends, resulting in the preference dividends becoming taxable in the hands of the Holder, the percentage of the prime rate referred to in clause above will be increased by the company. Such increase will be calculated to put that Holder, net after deduction of the dividends tax levied, at a deemed rate of 10%, in the position he/she would have been prior to the implementation of such dividends tax. The company shall require its auditors to verify whether it is obliged to increase the percentage of the prime rate referred to in clause above in accordance with this clause The auditors, in deciding whether such increase is required in terms of this clause 1.2.7, shall act as experts and not as arbitrators or quasi-arbitrators and their decision in the absence of manifest error shall be final and binding on the company and all preference shareholders. The costs of such auditors shall be borne and paid by the company. For the avoidance of doubt it is recorded that any increase in a tax rate previously imposed on preference dividends will not oblige the company to take any action Save as set out in clauses 1.2.2, 1.2.3, and above, the preference shares shall not be entitled to any further participation in the profits or assets of the company nor on a winding-up to any surplus assets of the company The Holders of the preference shares shall be entitled to receive notice of and be present but not to vote, either in person or by proxy, at any meeting of the company, by virtue of or in respect of the preference shares, unless either or both of the following circumstances prevail at the date of the meeting: the preference dividend or any part thereof remains in arrear and unpaid as determined in accordance with clause after 6 (six) months from the due date thereof; and 6

9 a resolution of the company is proposed which resolution directly affects the rights attached to the preference shares or the interests of the Holders thereof, including a resolution for the winding-up of the company or for the reduction of its capital, in which event the preference shareholders shall be entitled to vote only on such resolution At every general meeting of the company, at which Holders of preference shares as well as other classes of shares are present and entitled to vote, a preference share Holder shall be entitled to that proportion of the total votes in the company which the aggregate amount of the nominal value of the preference shares held by him bears to the aggregate amount of the nominal value of all shares issued by the company Notwithstanding the provisions of clause 1.2.2, no shares in the capital of the company ranking, as regards rights to dividends or, on a winding-up as regards return of capital, in priority to the preference shares, shall be created or issued, nor will the rights for the time being attached to the preference shares be modified, amended, added or abrogated, without: the prior sanction of a resolution passed at a separate class meeting of the Holders of the preference shares in the same manner mutatis mutandis as a special resolution; or the consent in writing of the Holders of at least 75% (seventy five percent) of the preference shares. At every meeting of the Holders of the preference shares, the provisions of these clauses relating to general meetings shall apply, mutatis mutandis, except that a quorum at any such general meeting shall be persons holding or representing by proxy at least one quarter of the issued preference shares provided that if at any adjournment of such meeting a quorum is not so present, the provisions of the clauses relating to adjourned general meetings shall apply, mutatis mutandis. 2. Occurrence of the Trigger Event The preference shares will, at the sole and absolute discretion of the Relevant Authority, either (i) be compulsorily converted into Ordinary Shares (on the basis set out in clause 3) or (ii) be automatically written off (on the basis set out in clause 4), as the case may be, upon the occurrence of the Trigger Event. 3. Compulsory Conversion 3.1 If the Relevant Authority requires the preference shares to be converted into ordinary shares then, on and with effect from the Trigger Event Date: (a) the preference shares shall be compulsorily converted into (and shall be deemed to have been compulsorily converted into) Ordinary Conversion Shares: (b) the Ordinary Conversion Shares shall automatically be (and shall be deemed to have been) fully paid, without further action on the part of the company or any Holder. 3.2 The number of Ordinary Conversion Shares into which the Holder s preference share/s shall be compulsorily converted shall be determined by dividing the aggregate Preference Share Amount in respect of such preference share/s by the Conversion Price and then rounding the resultant figure upward or downward to the nearest whole number. 3.3 The company will at all times maintain all prior authorisations necessary to ensure the compulsory conversion of the preference shares into Ordinary Conversion Shares on and with effect from the Trigger Event Date. 4. Mandatory write-off If the Relevant Authority requires the preference shares to be written off then, on and with effect from the Trigger Event Date, all of the rights and all of the obligations (in each case, whether actual, contingent, accrued or otherwise) of the company and the Holders under the preference shares shall automatically terminate, and the preference shares shall be (and shall be deemed to have been) automatically written off (for purposes of and/or as contemplated in the Basel III Framework and the Capital Regulations), without further action on the part of the company or any holder. 5. Notice and certificates 5.1 The company will notify the Holders of the occurrence of a Trigger Event as soon as may be practicable after the Trigger Event Date. 5.2 In the case of a Conversion, the company will, if the Ordinary Conversion Shares are in certificated from, procure that the certificate/s evidencing the Ordinary Conversion Shares are delivered to the Holders. The reason for and effect of this resolution are as set out under special resolution number 2. Note that the approval of shareholders will be obtained to issue the preference shares detailed in this special resolution number Special resolution number 5 Resolved in terms of section 16(1)(c)(ii) of the Act, that the company hereby approves and adopts in terms of section 16(5)(a) of the Act, a new memorandum of incorporation ( MOI ), a copy of which has been tabled at the AGM and initialled by the chairman of the board for identification purposes, in substitution for the existing memorandum of incorporation. The date on which the MOI becomes effective will be the date of registration of the resolution by the Registrar of Banks in terms of section 56(5)(a) of the Banks Act 1990 (Act 94 of 1990). 7

10 The reason for this special resolution is to obtain the approval of the shareholders of the company to replace the existing memorandum of incorporation (previously known as the memorandum of incorporation and articles of association) with a new MOI drafted in line with the requirements of the Act. In terms of Schedule 5 of the Act every pre-existing company has until 1 May 2013 to amend its MOI in harmony with the Act. A copy of the MOI proposed for adoption is available for inspection from 17 May 2012 up to 1 June 2012 at the registered office of the company at 1 Quantum Street, Techno Park, Stellenbosch, 7600, and at the offices of the company s transfer secretaries, Computershare Investor Services (Pty) Limited, 70 Marshall Street, Johannesburg, The effect of this special resolution will be that the company will adopt a new memorandum of incorporation in compliance with the Act. 3.6 Special resolution number 6 Resolved that the company be authorised as a general approval, to repurchase any of the ordinary shares issued by the company upon such terms and conditions and in such amounts as the directors may from time to time decide, subject to the provisions of sections 46 and 48 of the Act, the Banks Act, 1990 (Act 94 of 1990), as amended ( the Banks Act ), the Listings Requirements of the JSE Limited ( JSE ) and the memorandum of incorporation of the company, provided always that: This general approval shall expire at the date of the company s next AGM in 2013 or 1 September 2013, whichever is the earlier; The repurchase will only be effected through the order book operated by the JSE trading system and done without any prior understanding or arrangement between the company and the counterparty (reported trades are prohibited); An announcement as contemplated in the Listings Requirements of the JSE will be published when the company has acquired, on a cumulative basis, 3% of the number of shares of the relevant class it had in issue prior to the acquisition. Such announcement must contain full details of the acquisition as well as for each 3% in aggregate of the initial number of that class acquired thereafter; Aggregate repurchases under this general authority will not exceed 20% of the company s issued share capital of that class in any one financial year as at the date this authority is granted; The company will not make the repurchases at a price more than 10% above the weighted average of the market value of the securities of that class in issue for the five business days immediately preceding the date on which the transaction is effected. The JSE will be consulted for a ruling if the company s securities have not traded in such five business day period; The company will, at any time, appoint only one agent to effect any repurchase(s) on the company s behalf; A repurchase will only be made in terms of this resolution if the board has resolved to authorise the repurchase, that the company and its subsidiaries have passed the solvency and liquidity test and that, since the test was performed, there have been no material changes to the financial position of the group; and The company will not repurchase its securities during any prohibited period as defined in paragraph 3.67 of the Listings Requirements of the JSE unless a repurchase programme is in place in respect of which the dates and quantities of ordinary shares to be traded during such period are fixed and full details of such programme have been disclosed in an announcement over SENS prior to the commencement of the prohibited period. The reason for this special resolution is that the company seeks a general authority to repurchase its shares in the market subject to the Act, the Banks Act and the Listings Requirements of the JSE. The directors have no present intention of making any purchases under this authority but believe that the company should retain the flexibility to take action if future purchases should be considered desirable and in the best interest of shareholders. In terms of the Listings Requirements of the JSE, any general repurchase by the company must, inter alia, be limited to a maximum of 20% of the company s issued share capital of that class in any one financial year at the time the authority is granted. The directors intend to use this authorisation only to repurchase if after such repurchase: The company and the group will each be able to repay its debt as it becomes due in the ordinary course of business for a period of twelve months following such repurchase; The aggregate consolidated assets of the company, as fairly valued in terms of International Financial Reporting Standards, will exceed the aggregate consolidated liabilities of the company for a period of twelve months following such repurchase; and The share capital and reserves and working capital of the company and the group will be adequate for ordinary business purposes for a period of twelve months from the date of the notice of the AGM. Refer to Annexure B included in this notice of the AGM for a full list of directors and executive management members of the company including a summary curriculum vitae of each. Refer to Annexure C included in this notice of the AGM for general information in respect of: directors statement of responsibility; major shareholders; material changes; directors interests in securities; the share capital of the company; and the litigation statement. The effect of this special resolution, if approved, is to grant a general authority to the directors of the company to repurchase the company s shares in the market subject to the provisions of the Act, the Banks Act, the memorandum of incorporation of the company and the Listings Requirements of the JSE, where applicable. Special resolution number 6 is a renewal of the resolution approved at the previous AGM held on 3 June Special resolution number 7 Resolved that the company, insofar as it may be necessary to do so, hereby approves, as a general approval, and authorises the acquisition by any subsidiary of the company of shares of any class issued by such subsidiary and/or by the company upon such terms and conditions and in such amounts as the directors of such subsidiary/ies may from time to time decide, subject to the provisions of sections 46 and 48 of the Act, the memorandum of incorporation of the company and, insofar as they may be applicable, the Banks Act, 1990 (Act 94 of 1990), as amended ( the Banks Act ) and the Listings Requirements of the JSE Limited ( JSE ), provided always that: 8

11 This general approval shall expire at the date of the company s next AGM in 2013 or 1 September 2013, whichever is the earlier; A repurchase of securities in the company will only be effected through the order book operated by the JSE trading system and done without any prior understanding or arrangement between the company and the counterparty (reported trades are prohibited); An announcement as contemplated in the Listings Requirements of the JSE, will be published when the subsidiary has acquired, on a cumulative basis, 3% of the number of securities of that class which the company had in issue prior to the acquisition, containing full details thereof as well as for each 3% in aggregate of the initial number of that class acquired thereafter; Acquisitions by any company of its own securities under this general approval may not exceed 20% in the aggregate of the acquiree company s issued share capital of that class in any one financial year as at the date this authority is granted and in the case of the subsidiary acquiring shares in the company limited to an aggregate of 10% of the company s issued share capital of that class as at the date this authority is granted; The subsidiaries will not acquire securities in the company at a price more than 10% above the weighted average of the market value of securities of that class for the five business days immediately preceding the date of acquisition. To the extent applicable, the JSE will be consulted for a ruling if the company s securities have not traded in such five business day period; The subsidiaries will, at any point in time, appoint only one agent to effect any purchase(s) of the company s securities if applicable; and A repurchase will only be made in terms of this resolution if the board has resolved to authorise the repurchase, that the company and its subsidiaries have passed the solvency and liquidity test and that, since the test was performed, there have been no material changes to the financial position of the group; and The subsidiaries will not purchase any securities in the company during any prohibited period as defined in paragraph 3.67 of the Listings Requirements of the JSE unless a repurchase programme is in place in respect of which the dates and quantities of securities to be traded during such period are fixed and full details of such programme have been disclosed in an announcement on SENS prior to the commencement of the prohibited period. The reason for this special resolution is that the company, in so far as may be necessary, seeks a general authority to empower directors of subsidiaries to resolve that the said subsidiaries acquire shares issued by such subsidiaries and/or by the company in terms of the Act, their respective memorandums of incorporation and, where applicable, the Banks Act and the Listings Requirements of the JSE. The directors have no present intention of making any acquisition under this authority but believe that its subsidiaries should retain the flexibility to take action if future acquisitions should be considered desirable and in the best interests of shareholders. One such eventuality could be the acquisition of shares in the company by subsidiaries for delivery in terms of the Capitec Bank Holdings Share Trust (the share option scheme), the terms of which have been approved by shareholders at a general meeting held on 7 February 2002, and amendments thereto, on 2 June In terms of the Act, subsidiaries may acquire shares in the company to a maximum of 10% in the aggregate of the number of issued shares of the company. In terms of the Listings Requirements of the JSE, any general acquisition by a company of its listed shares must, inter alia, be limited to a maximum of 20% of that class of the issued share capital of the acquiree company in any one financial year at the time the authority is granted. The authorisation provided to subsidiaries to acquire their own shares or shares in the company will only be exercised by the directors of such subsidiaries if, at the discretion of the board of the company, circumstances should merit such purchase and if after such acquisition: The company, relevant subsidiaries and the group will each be able to repay its debt as it becomes due in the ordinary course of business for a period of twelve months following such acquisition; The aggregate assets of the company, relevant subsidiaries and the group, as fairly valued in terms of International Financial Reporting Standards, will exceed the aggregate liabilities of the company, the subsidiaries and the group for a period of twelve months following such acquisition; and The share capital and reserves and working capital of the company, relevant subsidiaries and the group will be adequate for ordinary business purposes for a period of twelve months from the date of the notice of the AGM. Refer to Annexure B included in this notice of the AGM for a full list of directors and executive management members of the company including a summary curriculum vitae of each. Refer to Annexure C included in this notice of the AGM for general information in respect of: directors statement of responsibility; major shareholders; material changes; directors interests in securities; the share capital of the company, and the litigation statement. The effect of this special resolution, if approved, is to grant a general authority to the directors of the company s subsidiaries to acquire shares issued by such subsidiaries and/or by the company, subject to the provisions of the Act, the memorandum of incorporation of the subsidiaries and the company and where applicable, the Banks Act and the Listings Requirements of the JSE. Special resolution number 7 is a renewal of the resolution approved at the previous AGM held on 3 June Special resolution number 8 Resolved in terms of section 45(3)(a)(ii) of the Act, as a general approval, that the board of the company be authorised to approve that the company provides any direct or indirect financial assistance ( financial assistance will herein have the meaning attributed to it in section 45(1) of the Act) that the board of the company may deem fit to any company or corporation that is related or inter-related ( related and inter-related will herein have the meaning attributed to it in section 2 of the Act) to the company, on the terms and conditions and for amounts that the board of the company may determine. 9