Notice of Annual General Meeting

as at 30 June 2007

Notice is hereby given that the annual general meeting of the Company will be held at 08:30 at Massmart House, 16 Peltier Drive, Sunninghill Ext 6, Sandton, on Wednesday, 21 November 2007, for purposes of:

  1. Transacting the following business:
     
    1.1 to receive and adopt the annual financial statements of the Company and the Group for the year ended 30 June 2007;
    1.2 to elect directors in the place of those retiring in accordance with the Company’s Articles of Association; and
    1.3 to transact such other business as may be transacted at an annual general meeting.
  2. Considering and, if deemed fit, passing, with or without modification, the following ordinary and special resolutions:
     

Ordinary resolutions:

  1. “Resolved that the annual financial statements of the Company and the Group for the year ended 30 June 2007, circulated together with this notice, be and are hereby adopted.”
  2. “Resolved that Mr KD Dlamini, who retires in terms of the Articles of Association and has offered himself for re-election, be and is hereby re-elected to the Board of Directors of the Company.”
  3. “Resolved that Dr NN Gwagwa, who retires in terms of the Articles of Association and has offered herself for re-election, be and is hereby re-elected to the Board of Directors of the Company.”
  4. “Resolved that Mr JC Hodkinson, who retires by rotation and has offered himself for re-election, be and is hereby re-elected to the Board of Directors of the Company.”
  5. “Resolved that Mr MJ Lamberti, who retires by rotation and has offered himself for re-election, be and is hereby re-elected to the Board of Directors of the Company.”
  6. “Resolved that Ms P Langeni, who retires by rotation and has offered herself for re-election, be and is hereby re-elected to the Board of Directors of the Company.”
  7. “Resolved that the non-executive directors’ annual remuneration for the 2008 financial year be set as follows:
     
    Chairman of the Board R625 000
    Deputy Chairman R450 000
    Directors R185 000
    Committee chairmen R185 000
    Committee members R87 000”
  8. “Resolved that Messrs Deloitte & Touche be and are hereby re-elected as the Company’s auditors for the ensuing financial year.”
  9. “Resolved that all the ordinary shares in the authorised but unissued share capital of the Company be and are hereby placed under the control of the directors in terms of section 221(2) of the Companies Act, 1973 (Act 61 of 1973), as amended (“the Act”), who shall be authorised to allot and issue such shares to such person or persons on such terms and conditions as they may deem fit but not exceeding 5% of the number of shares already in issue. Such allotment will be in accordance with the Act and the Listings Requirements of the JSE Limited (“JSE”)”.
  10. “Resolved that, subject to the JSE Listings Requirements, the directors be and are hereby authorised to issue the ordinary shares in the authorised but unissued share capital of the Company for cash to such person or persons on such terms and conditions as they may deem fit, subject to the following:
     
    10.1 the shares shall be of a class already in issue;
    10.2 the shares shall be issued to public shareholders (as defined in the JSE Listings Requirements) and not to related parties (as defined in the JSE Listings Requirements);
    10.3 the issues in the aggregate in any one financial year shall not exceed 5% (five percent) of the number of shares already in issue;
    10.4 the maximum discount at which the shares may be issued shall be 10% (ten percent) of the weighted average traded price of the shares over the 30 (thirty) business days prior to the date that the price of the issue is determined or agreed by the directors;
    10.5 the authority hereby granted will be valid until the Company’s next annual general meeting, provided that it will not extend to beyond 15 (fifteen) months;
    10.6 once the securities have been issued, the Company shall publish an announcement in accordance with paragraph 11.22 of the JSE Listings Requirements.”


Special resolution:

The approval of a 75% (seventy-five percent) majority of the votes cast by members present or represented by proxy at the annual general meeting and entitled to vote is required for this resolution to become effective:

  1. “Resolved that the Company and its subsidiaries be and are hereby authorised in terms of sections 85(2) and 85(3) of the Act, and the JSE Listings Requirements, from time to time to acquire the ordinary and/or preference shares in the issued share capital of the Company from such shareholder/s, at such price, in such manner and subject to such terms and conditions as the directors may deem fit, but subject to the Articles of Association of the Company, the Act and the JSE Listings Requirements, and provided that:
     
    1.1 the authority hereby granted will be valid until the Company’s next annual general meeting, provided that it will not extend to beyond 15 (fifteen) months from the date of registration of this special resolution;
    1.2 acquisitions may not be made at a price greater than 10% (ten percent) above the weighted average of the market value for the shares determined over the 5 (five) business days prior to the date that the price for the acquisition is effected;
    1.3 acquisitions in the aggregate in any one financial year shall not exceed 15% (fifteen percent) of that class of the Company’s issued share capital;
    1.4 the repurchase of securities will be effected through the order book operated by the JSE trading system and will be done without any prior understanding or arrangement between the Company and the counterparty;
    1.5 the Company will only appoint one agent to effect the repurchases on the Company’s behalf;
    1.6 the Company will only undertake a repurchase of securities if, after such repurchases, the Company complies with the JSE listing shareholder spread requirements;
    1.7 neither the Company nor its subsidiaries may repurchase securities during a prohibited period unless a repurchase programme is in place where the dates and quantities of securities to be traded during the relevant period are fixed and where full details of the programme have been disclosed in an announcement over SENS prior to the commencement of the prohibited period;
    1.8 an announcement complying with 11.27 of the JSE Listings Requirements will be published by the Company when the Company and/or its subsidiaries over any twelve month period have cumulatively repurchased 3% (three percent) of the Company’s issued ordinary and/or preference share capital and for each 3% (three percent) in aggregate thereafter.”


Statement by the Board of Directors

In accordance with the JSE Listings Requirements, the directors state that:

a) the intention of the directors is to utilise the authority at a future date, provided that the cash resources of the Company are in excess of its requirements. In this regard, the directors will take into account, inter alia, an appropriate capitalisation structure for the Company and the long-term cash needs of the Company, and will ensure that any such utilisation is in the interests of the shareholders;
b) having considered the effect of the maximum number of ordinary and preference shares that may be acquired pursuant to the authority and the date upon which such acquisition/s will take place:
 
  • the Company and its subsidiaries will be able in the ordinary course of business to pay their debts for a period of twelve months after the date of this notice of annual general meeting;
  • the assets of the Company and its subsidiaries will be in excess of the liabilities of the Company and its subsidiaries for a period of twelve months after the date of this notice of annual general meeting, such assets and liabilities being fairly valued in accordance with International Financial Reporting Standards and in accordance with the accounting policies used in the Company and the Group annual financial statements for the year ended 30 June 2007;
  • the issued share capital and reserves of the Company and its subsidiaries will be adequate for purposes of the business of the Company and its subsidiaries for a period of twelve months after the date of this notice of annual general meeting;
  • the working capital available to the Company and its subsidiaries will be adequate for purposes of the business of the Company and its subsidiaries for a period of twelve months after the date of this notice of annual general meeting.

The Company will ensure that its sponsor provides the necessary sponsor letter on the adequacy of the working capital in terms of the JSE Listings Requirements, prior to the commencement of any purchase of the Company shares on the open market.

Reason and effect

The reason for special resolution number 1 is to give a mandate to the directors to repurchase ordinary and preference shares in the Company.

The effect of special resolution number 1 will be that the Company and its subsidiaries will be authorised to acquire ordinary and preference shares in the Company.

Voting and proxies

All holders of ordinary and preference shares in the share capital of the Company are entitled to attend and vote at the annual general meeting. Subject to any rights or restrictions for the time being attached to any ordinary and/or preference shares, on a show of hands, every holder of ordinary and/or preference shares who is present in person, or in the case of a company, the representative appointed in terms of section 188 of the Act, has one vote. On a poll, each holder of ordinary and/or preference shares has so many votes for each ordinary and preference share (as the case may be) as is determined in accordance with section 195 of the Act, read with the Company’s Articles of Association.

In terms of the Listings Requirements, Massmart ordinary shares held by and registered in the name of The Massmart Holdings Limited Employees Share Trust will not have their votes at the annual general meeting taken into account for Listings Requirements resolution approval purposes. However, Massmart preference shares held by the Massmart Thuthukani Empowerment Trust and the Massmart Black Scarce Skills Trust will have their votes at the annual general meeting taken into account for Listings Requirements resolution approval purposes.

If you hold certificated shares (i.e. have not dematerialised your shares in the Company) or are registered as an own name dematerialised shareholder, then:

  • you may attend and vote at the annual general meeting; alternatively
  • you may appoint a proxy to represent you at the annual general meeting by completing the attached form of proxy and returning it to the registered office of the Company to be received by no later than 48 hours prior to the time appointed for the holding of the meeting (excluding Saturdays, Sundays and public holidays).

If you own dematerialised shares (i.e. have replaced the paper share certificates representing the shares with electronic records of ownership under the JSE’s electronic settlement system, STRATE Limited (“STRATE”), and are not registered as an “own name dematerialised shareholder” (i.e. specifically instructed your Central Securities Depository Participant (“CSDP”) to hold your shares in your own name on the Company’s sub-register), then, subject to the mandate between yourself and your CSDP or broker:

  • if you wish to attend the annual general meeting you must contact your CSDP or broker, as the case may be, and obtain the relevant letter of representation from it; alternatively
  • if you are unable to attend the annual general meeting but wish to be represented at the meeting, you must contact your CSDP or broker, as the case may be, and furnish it with your voting instructions in respect of the annual general meeting. You must not complete the attached form of proxy. The instructions must be provided in accordance with the mandate between yourself and your CSDP or broker, as the case may be, within the time period required by your CSDP or broker, as the case may be.

CSDPs, brokers or their nominees, as the case may be, recorded in the Company’s subregister should, when authorised in terms of their mandate or instructed to do so by the owner on behalf of whom they hold dematerialised shares in the Company, vote by either appointing a duly authorised representative to attend and vote at the annual general meeting or by completing the attached form of proxy in accordance with the instructions thereon and returning it to the registered office of the Company to be received not less than 48 hours prior to the time appointed for the holding of the meeting.

In terms of the JSE Listings Requirements for special resolution number 1, general information is included in the annual report attached, including:

(i) Directors and management
(ii) Major shareholders
(iii) Material changes
(iv) Directors’ interests in securities
(v) Share capital of the Company
(vi) Litigation

The directors whose names appear here collectively and individually accept full responsibility for the accuracy of the information given and certify that to the best of their knowledge and belief there are no facts that have been omitted which would make any statement false or misleading, and that all reasonable enquiries to ascertain such facts have been made and that the circular (the notice to the annual general meeting) contains all information required by law and the JSE Listings Requirements.

By order of the Board

Ilan Zwarenstein
Company Secretary

Johannesburg
10 October 2007