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Date of publication: 2 September 2019

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TERMS AND CONDITIONS APPLICABLE TO COAL SALES TRANSACTIONS FROM BIG MAN
HARTOGSHOOP COLLIERIES [MINING PERMIT NUMBER MP30/5/1/3/2/11532MP]

1. SALE AND PURCHASE : Big Man Mining (Pty) Ltd (“the Seller”) agrees to sell to the
Purchaser run-of-mine (ROM) coal, i.e. raw mined coal (not
beneficiated in any manner whatsoever), as it is stockpiled in the
coal stockyard area that is adjacent to the mining area at Big
Man-Hartogshoop Colliery.

2. UNIT OF MEASUREMENT : Metric ton,

3. PRICE PER METRIC TON OF : a) As per the amounts indicated on the relevant pro forma
COAL invoice.

b) The price per ton is exclusive of value-added tax.

4. COAL STOCKPILES a) ROM coal that is extracted from the mining area is
accumulated in stockpiles.

b) A stockpile, once created, is surveyed1 by a duly registered

mine surveyor, given a unique stockpile identification
number and recorded in a coal stockyard inventory.

c) All stockpiles are recorded in an official survey report, duly

signed by the mine surveyor.

d) The accuracy of a duly signed survey report shall be

presumed prima facie.

e) 1.1 is used as the value of the relative density (RD) of the

stockpiled coal, i.e the relevant factor to convert volume to
weight.

f) The combined weight of a stockpile is therefore determined

by multiplying the volumetric volume in cubic meters multiplied
by 1.1 equals mass in kilograms, which is then converted to
metric ton by dividing it with 1000.

g) Coal stockpiles are sold as units.

5. INSPECTION OF COAL : a) Any potential coal purchaser will have the right to appoint a
STOCKPILES AND COAL commercial coal testing laboratory to extract representative
SPECIFICATIONS coal samples from those stockpiles from which the potential
purchaser intends purchasing coal from.

b) The sampling of coal by a coal testing laboratory must be

done prior to a potential coal purchaser placing an order for

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a volumetric measurement in cubic meters
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a consignment of coal and/or the issuing of a pro forma

invoice.

c) The sampling process shall be conducted by the technicians

of the relevant coal testing laboratory exclusively and by no
other persons.

d) The collection of samples from a specific stockpile may only

be conducted prior to the issuing of a purchase order by a
potential purchaser alternatively prior to relevant purchaser
ordering a consignment of coal.

e) The cost of analyzing the relevant samples will be for the

account of the relevant coal purchaser.

f) The Purchaser, by depositing the required amount into the

trust account of the Payment Agent with regards to a specific
pro forma invoice warrants its satisfaction with the coal that
is the subject of the specific pro forma invoice.

g) The Seller is unable to provide any warranty on fitness for

the purpose that the Purchaser might be purchasing coal for
and all coal is sold “as is”.

6. MANNER OF PAYMENT : Cash, into the account nominated by the Seller and as
indicated in part 7 below.

7. ACCOUNT NOMINATED : Account name : Retha du Plessis Attorneys Trust

FOR PAYMENT
Bank and branch : Standard Bank – Hatfield branch
Account number : 0322 797 87
Reference : Pro forma invoice number
8. PAYMENT AGENT : Ms Retha du Plessis of Retha du Plessis Attorneys shall act as
the Payment Agent.

9. PAYMENT PROCESS : a) The Purchaser shall be required to deposit an amount equal

to the grand total of the relevant pro forma invoice into the
trust account of the Payment Agent, as referred to in part 7
above.

b) A pro forma invoice will automatically lapse in the event that

a purchaser fails to make the required deposit within one
business day of the issuing of the pro forma invoice.

c) The Purchaser may after depositing the relevant amount

into the trust account of the Payment Agent post a security
guard in the coal stockyard to prevent any party from
tampering with a coal stockpile that is the subject of a
pending transaction. The aforesaid cost shall be for the
account of the Purchaser and the Purchaser shall be obliged
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to ensure that such security officers comply with the Mine

Health and Safety Act and Regulations.

10. WEIGHT DETERMINATION a) The provisional weight of the coal that is to be delivered shall
AND RECONCILIATION be determined in accordance with clauses 4(a) to 4(f) above.

b) The final weight of the coal shall be determined by making

use of a duly calibrated weighbridge at the Big Man-
Hartogshoop Colliery.

c) The quantity of coal loaded on a specific delivery vehicle

shall be: Gross weight [of a delivery vehicle once loaded
with coal] minus Tare weight [empty delivery vehicle
immediately prior to entering the coal stockyard area] equals
Quantity of coal on specific delivery vehicle [net weight].

d) A Purchaser will have to right to observe the weighing

process as set out in clause 10(c) above.

e) The final weight of a consignment of coal will be determined

by a tally of all the weighbridge slips of the relevant delivery
vehicles.

f) The accuracy of a tally sheet in respect of a specific day that

is printed directly from the computer connected to the Trek
Scale weighbridge shall be presumed prima facie

g) If the Seller delivered a smaller quantity of coal to a

Purchaser than the quantity stated on the relevant pro forma
invoice, then the Seller shall instruct the Payment Agent to
do a refund to such a purchaser within 72 hours of the
Purchaser requesting a refund alternatively, issue a credit
note in favour of the relevant Purchaser.

h) If the quantity of coal delivered to a purchaser exceeds the

quantity as per the pro forma invoice, then the Seller will
issue an additional invoice which will become payable within
seven days of date of invoice.

11. DELIVERY PROCESS : a) The Parties agree the coal shall be delivered against the
term “Free Carrier” (“FCA”) as set out under INCOTERMS
2010®, at the Big Man Hartogshoop coal mine stockpile
facility, as follows;

The Purchaser takes Delivery in Quantities which the

Seller must Load from the product stockpile, or individual
stockpiles, onto the delivery vehicle of the Purchaser.
The Purchaser will take Delivery on its own road haul
vehicles.
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b) The Seller shall deliver the coal to the Purchaser at the

designated loading area located at the Big Man Hartogshoop
Colliery (“the loading area”) adjacent to the mining area.

c) The Purchaser shall give notice in writing2 to Mr Paul

Jordaan and Francois Greeff prior to delivery, and shall,
amongst others furnish the following information:

i. the details of the transport contractor; and

ii. the fleet list of the relevant delivery vehicles,

i.e. the registration numbers of the transport
vehicles and if applicable, its trailer(s).

d) The loading time of coal shall be between the hours of

07h00 and 19h00 on Mondays to Fridays unless such a day
falls on a public holiday, and in which case loading will not
take place.

12. DELIVERY AND PASSING a) Delivery of the coal shall deem to have taken place as when
OF RISK the relevant outbound delivery vehicles progressively pass
over the weighbridge at the loading area.

b) A coal purchaser shall be required to uplift a minimum of

1,000 (one thousand) metric tons of coal per day from the
Big Man Hartogshoop Colliery.

c) A coal purchaser shall be required to commence with the

upliftment of coal on the next business day immediately
following the day on which the Payment Agent has received
payment in her attorneys’ trust account.

d) A coal purchaser will deem to have taken delivery of 1,000

metric tons of coal per day unless the quantity of coal that is
to be delivered to the relevant coal purchaser is less than a
1,000 metric tons, in which case the relevant outstanding
quantity of coal will deem to have been delivered to such a
coal purchaser.

e) The provisions of clause 12(d) above will apply irrespective

of the fact that a coal purchaser has failed to physically uplift
the quantities as described in clause 12(d) above.

f) Risk shall pass to the Purchaser when the sale is perfecta.

g) The Purchaser may, after a sale has become perfecta, post

a security guard in the coal stockyard to prevent any party
from tampering with any coal stockpile that is the subject of
a pro forma invoice. The aforesaid cost shall be for the
account of the Purchaser and the Purchaser shall be obliged
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via email alternatively via WhatsApp message ( 071 608 8841 and/or 082 338 0093)
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to ensure that such security officers comply with the Mine

Health and Safety Act and Regulations and that he/she is
duly registered with the relevant authority.

13. ACCOUNTING AND : a) The Payment Agent shall account daily after delivery has
RECONCILIATION taken place alternatively after deemed delivery has taken
place.

b) Clauses 10(b) to 10(h) above will apply with the changes as

required to the context in the event of delivery.

c) Clauses 4(a) to 4(e), 12(b) and 12(d) above will apply with
the changes as required to the context in the event of
deemed delivery.

d) The quantity of coal delivered on a specific day shall always

be deemed as 1,000 metric tons, subject to the following
provisions:

i. If the quantity of coal that is to be delivered to a coal

purchaser is less than 1,000 metric tons, then the
deemed quantity of coal delivered will be the relevant
outstanding quantity.

ii. If a purchaser has removed less than 1,000 metric

tons of coal from the Big Man-Hartogshoop Colliery,
then the deemed quantity of coal will be calculated
by subtracting the total weight of the coal appearing
on the tally sheet for a specific day from 1,000 metric
tons.3

DATE OF THESE TERMS AND CONDITIONS: 2 September 2019

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It will, therefore, be possible for actual and deemed delivery to take place simultaneously.