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• until the third anniversary from the Implementation Date, the Voting Pool Members may notdispose of their shares without prior written consent from the Company, and in the event of anydisposal of shares, the disposing Voting Pool Members must first offer their shares to theexisting Voting Pool Members; and• the Voting Pool Agreement shall endure so long as:– the Voting Pool Members beneficially own at least 5% of the entire issued capital ofGold Reef; and– until in terms of BEE regulations and regulations of the relevant gaming boards, Gold Reefshares can be transferred without Gold Reef’s BEE Status being negatively affected.The existing BEE economic interests in the subsidiaries, joint venture and management contractsof the Company are set our below:BEE shareholder Subsidiary, Joint venture or PercentageManagement contracteconomic interestALI BEE shareholders Akani Egoli 25,02ALSH BEE shareholders Silverstar 50,00ALICM BEE shareholders Akani Egoli Contract 25,00ALMI BEE shareholders Akani Msunduzi 15,00ALGI BEE shareholders Goldfields Casino 12,00Reygrande West Coast Leisure 10,00Satara Goldfields Contract 30,00The ordinary resolution authorising the Proposed Share Exchange is contained in the attachednotice of general meeting of shareholders (ordinary resolution number 1). The Proposed ShareExchange is subject to approval by a 50% majority of the votes, excluding the votes of the BEEshareholders and their associates, at the general meeting of shareholders.4.2 The ALI acquisition4.2.1 Nature of business of ALIGold Reef owns a direct and economic interest of 50,00% in the ordinary share capital ofAkani Egoli and a 49,98% direct and economic interest in ALI. The remaining 50,02% of ALIis owned by the ALI BEE shareholders. This results in the ALI BEE shareholders owning anindirect and economic interest of 25,02% in Akani Egoli.The ALI BEE shareholders that Gold Reef will be transacting with are as follows:• Black Management Forum Investment Company Limited;• G7 Investments Holdings (Proprietary) Limited;• Mary Jantjies Family Trust;• Newshelf 698 (Proprietary) Limited;• Newshelf 800 (Proprietary) Limited;• Platoon Trade and Invest 15 (Proprietary) Limited;• Prime Portfolio Investments “A” (Proprietary) Limited;• Saddle Path Props 20 (Proprietary) Limited;• XAU Investments CC;• Y Investments Limited; and• Young Women’s Christian Association – Dube Charitable Trust.4.2.2 Details of the ALI acquisitionGold Reef will acquire the remaining 50.02% interest in ALI from the ALI BEE shareholdersfor approximately R384,8 million. The effect of the ALI acquisition is that Gold Reef will havea direct and economic interest of 100,00% in ALI and consequently Akani Egoli.The ALI acquisition will be settled by the issue of 16 881 426 Gold Reef shares andR64,1 million in cash. The cash component will be used by the ALI BEE shareholders tosettle various taxes arising from the ALI acquisition and to settle the Outstanding ALI BEEPreference Shares.12
4.3 The ALSH acquisition4.3.1 Nature of business of ALSHGold Reef owns a direct and economic interest of 50,00% in the ordinary share capitalof Silverstar.ALSH owns the remaining 50,00% direct and economic interest in Silverstar. The ALSH BEEshareholders own an indirect and economic interest of 100,00% in ALSH.4.3.2 Details of the ALSH acquisitionGold Reef will acquire 100,00% of the economic interest in ALSH from the ALSH BEEshareholders for approximately R519,2 million. The effect of the ALSH acquisition is thatGold Reef will:• have an economic interest of 100,00% in ALSH and consequently Silverstar;• assume external debt of R91,8 million, which will be immediately repaid by Gold Reeffollowing the successful implementation of the Proposed Share Exchange and Top-upTransaction.The ALSH acquisition will be settled by the issue of 27 323 575 Gold Reef shares.Prior to the Proposed Share Exchange Silverstar was accounted for as a joint venture andonly 50% of its assets, liabilities, revenues and expenses were consolidated. After theProposed Share Exchange ALSH and Silverstar will become wholly owned subsidiaries.The consideration was allocated to the net liabilities of ALSH and Silverstar.Allocation ofconsiderationAsset or liability of ALSH and Silverstar acquired(R’000)AssetsProperty, plant and equipment 49 951Receivables and prepayments 5 249LiabilitiesExternal debt (91 468)Deferred tax liabilities (2 820)Trade and other payables (294)Interest rate hedge (10 251)Bank overdraft (31 397)Amounts owing to related parties (33 160)Net liabilities assumed (114 190)Total consideration paid 519 1484.4 The ALICM acquisition4.4.1 Nature of business of ALICM• GRM holds a 75,00% economic interest in the Akani Egoli Contract.• ALICM holds the remaining 25,00% economic interest in the Akani Egoli Contract.4.4.2 Details of the ALICM acquisition633 338Gold Reef will acquire 100,00% of the economic interest in ALICM from ALICM BEEshareholders for approximately R30,7 million. The effect of the ALICM acquisition is thatGold Reef will hold a 100,00% economic interest in ALICM and consequently the Akani EgoliContract.13
Page 4: 9. GENERAL MEETING OF SHAREHOLDERS
Page 8 and 9: “ALSH BEE shareholders”“Artic
Page 10: “joint independent professionalex
Page 13: 2. RATIONALE FOR THE PROPOSED SHARE
Page 17 and 18: Total consideration paid to each BE
Page 19 and 20: • Eglin Investments No. 30 (Propr
Page 21 and 22: for on the Implementation Date in t
Page 23 and 24: 5.2 BorrowingsDetails of all materi
Page 25 and 26: The detailed pro forma financial in
Page 27 and 28: 9. GENERAL MEETING OF SHAREHOLDERS
Page 29 and 30: Abridged curricula vitae of the dir
Page 32 and 33: 11.1.7 Directors’ emolumentsThe t
Page 34 and 35: 11.3 Directors’ opinionThe Board
Page 36 and 37: Annexure 1AFAIR AND REASONABLE OPIN
Page 38 and 39: • considered prevailing economic
Page 40 and 41: Annexure 1BFAIR AND REASONABLE OPIN
Page 42 and 43: • considered the performance and
Page 44 and 45: Annexure 2THE PRO FORMA FINANCIAL I
Page 46 and 47: Notes:(1) Extracted from the review
Page 48 and 49: considering the evidence supporting
Page 50 and 51: GROUP BALANCE SHEET AT 31 DECEMBERN
Page 52 and 53: GROUP CASH FLOW STATEMENT FOR THE Y
Page 54 and 55: NOTES TO THE ANNUAL FINANCIAL STATE
Page 56 and 57: 1.2 Financial statement presentatio
Page 58 and 59: Subsequent costs are included in th
Page 60 and 61: depends on the purpose for which th
Page 62 and 63: usiness combination) of other asset
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Leases of property, plant and equip
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The nominal value less estimated cr
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4. OTHER INCOME2006 2005 2004R’00
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8. TAXATION2006 2005 2004R’000 R
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11. PROPERTY, PLANT AND EQUIPMENTFu
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15. INVESTMENT IN ASSOCIATE2006 200
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16. INVESTMENT IN JOINT VENTURES (c
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18. SHARE INCENTIVE SCHEME (continu
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23. OTHER RESERVESExistingcontrolbu
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25. INTEREST BEARING BORROWINGS (co
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28. PROVISIONSPerformanceTotalGamin
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30. BUSINESS COMBINATIONS (continue
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31. RELATED PARTY TRANSACTIONS (con
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33. CONTINGENCIES, COMMITMENTS AND
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Annexure 5PRICE HISTORY OF GOLD REE
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Annexure 6STATEMENT IN RESPECT OF T
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Remuneration and Nominations Commit
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Annexure 7STATEMENT OF OTHER DIRECT
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DIRECTOR STATUS COMPANYRESIGNED STA
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DIRECTOR STATUS COMPANYACTIVE TWINC
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Annexure 8EXTRACTS FROM THE ARTICLE
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17.2 Questions arising at any meeti
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AKANI EGOLI ARTICLES OF ASSOCIATION
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17.5 The directors may delegate or
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19.4 Questions arising at any meeti
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Annexure 9COMPLETE LIST OF ACQUISIT
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Amount NumberBEE partner Agreement
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Amount NumberBEE partner Agreement
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CONTENTS1. INTRODUCTION 1202. SUMMA
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There has been no change in the con
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4.10 Acquisition and disposal of ma
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After implementation of the Share E
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10.2 Litigation statementThe litiga
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COMMENTARYIn terms of the Listings
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GOLD REEFR E S O R T SGOLD REEF RES
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