The offer of Krugerrand Custodial Certificates does not constitute an “offer to the public” (as defined in the Companies Act, No. 71 of 2008 (as amended)) (“Companies Act’) and this Offering Circular does not, nor is it intended to, constitute a “registered prospectus” (as is defined in the Companies Act) prepared and registered under the South African Companies Act. To the extent that Krugerrand Custodial Certificates are offered for subscription, such offer is made in terms of section 96(1)(b) of the Companies Act such that the total acquisition cost of the Krugerrand Custodial Certificates for any single addressee acting as principal is equal to or greater than ZAR 1 000 000. Accordingly, any offer made in terms of this Offering Circular does not constitute an "offer to the public or any section of the public" within the meaning of the Companies Act. PROSPECTIVE PURCHASERS OF ANY KRUGERRAND CUSTODIAL CERTIFICATES SHOULD ENSURE THAT THEY UNDERSTAND FULLY THE NATURE OF THE KRUGERRAND CUSTODIAL CERTIFICATES AND THE EXTENT OF THEIR EXPOSURE TO RISKS, AND THAT THEY CONSIDER THE SUITABILITY OF THE KRUGERRAND CUSTODIAL CERTIFICATES AS AN INVESTMENT IN THE LIGHT OF THEIR OWN CIRCUMSTANCES AND FINANCIAL POSITION OFFERING CIRCULAR For the listing of Krugerrand Custodial Certificates on the Exchange Traded Fund sector of the JSE created, listed and issued by FirstRand Bank Limited The Krugerrand Custodial Certificates will be listed on the “Exchange Traded Funds” sector of the JSE under the abbreviated name and alpha code “KCCGLD” and ISIN Code ZAE000195830 with effect from the commencement of business on Monday, 10 November 2014 and traded on the JSE through any authorised user of the JSE. The directors of FirstRand Bank Limited, whose names are set out in clause 16.4 of this Offering Circular, collectively and individually, accept full responsibility for the accuracy of information contained in this Offering Circular and certify that, to the best of their knowledge and belief, no facts have been omitted, the omission of which would make any statement false or misleading, that they have made all reasonable enquiries to ascertain such facts and that the Offering Circular contains all information required by law and the JSE Listings Requirements. The JSE’s approval of the listing of the Krugerrand Custodial Certificates is not to be taken in any way as an indication of the merits of an ETF or of the Krugerrand Custodial Certificates. The JSE has not verified the accuracy and truth of the contents of this Offering Circular and, to the extent permitted by law, will not be liable for any claim of whatever kind. Claims against the JSE Guarantee Fund may only be made in respect of trading in Krugerrand Custodial Certificates on the JSE and in accordance with the terms of the rules of the Guarantee Fund and can in no way relate to the issue of Krugerrand Custodial Certificates. The Merchant Bank, Sponsor, Market Maker and Attorneys have consented in writing to act in the capacity stated and to their names being included in this Offering Circular and have not withdrawn their consent prior to the publication of this Offering Circular. Any prospective investor with questions in relation to the Krugerrand Custodial Certificates is invited to contact Ebrahim Patel on +27 011 282 1275. Queries may also be directed by email to [email protected]. An abridged version of this Offering Circular was published in the press and released on the Stock Exchange News Service of the JSE on Monday, 10 November 2014. Date of issue: 21 October 2014 Merchant Bank, Sponsor and Market Maker Attorneys CORPORATE INFORMATION Company secretary and registered office of the Issuer Attorneys Carnita Low Webber Wentzel 4 Merchant Place 10 Fricker Road Cnr Rivonia Road and Fredman Drive Illovo Boulevard Sandton, 2146 Sandton, 2196 (PO Box 786273, Sandton, 2146) (P O Box 61771, Marshalltown, 2107) Incorporated in the Republic of South Africa on 11 January 1929 Merchant Bank, Sponsor and Market Maker Central Securities Depository Rand Merchant Bank (A division of FirstRand Bank Limited) Strate Limited (Registration number 1929/001225/06) 1st Floor 1 Merchant Place 9 Fricker Road Cnr Rivonia Road and Fredman Drive Illovo Boulevard Sandton, 2146 Sandton, 2196 (PO Box 786273, Sandton, 2146) (PO Box 78608, Sandton, 2146) Transfer secretaries Brink’s Southern Africa (Proprietary) Limited (Registration number 1996/004662/07) 40 Electron Road Isando, 1601 This Offering Circular is available in English only. Copies may be obtained from the registered office of the Market Maker and the Transfer Secretaries at the addresses set out above. 2 TABLE OF CONTENTS PAGE CORPORATE INFORMATION .................................................................................................. inside front cover INTERPRETATION AND DEFINITIONS ................................................................................................................ 4 1. Introduction ..................................................................................................................................... 8 2. The underlying assets of the Krugerrand Custodial Certificates ........................................................ 8 3. Structure of the Krugerrand Custodial Certificates ........................................................................... 9 4. Krugerrand Custodial Certificates fee structure ................................................................................ 9 5. Safe custody of the Coins ............................................................................................................... 10 6. Legal nature of the Krugerrand Custodial Certificates .................................................................... 10 7. Allocation and delivery of the Allocated Krugerrand ...................................................................... 11 8. Collection of Krugerrands ............................................................................................................... 11 9. Issuer’s election and reset mechanism ........................................................................................... 12 10. Reconciliation of records ................................................................................................................ 12 11. Procedure in the event of mismatches ........................................................................................... 12 12. Delisting procedure ........................................................................................................................ 13 13. NAV ................................................................................................................................................ 13 14. ASSOCIATED RISKS OF INVESTING IN KRUGERRAND CUSTODIAL CERTIFICATES ............................. 14 15. REGULATORY CONSIDERATIONS IN RESPECT OF THE KRUGERRAND CUSTODIAL CERTIFICATES ..... 16 16. THE ISSUER ..................................................................................................................................... 19 ANNEXURE I ....................................................................................................................................................... THE TERMS AND CONDITIONS ATTACHING TO A KRUGERRAND CUSTODIAL CERTICATE ................................ 24 3 INTERPRETATION AND DEFINITIONS In this Offering Circular and the annexures hereto, unless the context indicates otherwise, the words in the first column shall have the meanings assigned to them in the second column, the singular includes the plural and vice versa, an expression which denotes one gender includes the other genders, a natural person includes a juristic person and vice versa, and cognate expressions shall bear corresponding meanings. To the extent that there is a conflict between Offering Circular and the clauses in the Contract, the clauses in the Contract shall prevail. “Allocated Krugerrand/s” or “Krugerrand a specific one ounce fine gold Krugerrand coin with a standard mass of Coin/s” approximately 33,965 grams as referred to in Schedule 2 to the South African Reserve Bank Act 90 of 1986, identified by its Unique Number, to be allocated by the Allocator to a Holder through the application of the Allocation Algorithm; “Allocation Algorithm” the bespoke algorithm-based allocation system that will be used by the Allocator to identify the Krugerrand to be Delivered to the Holder; “Allocator” the Issuer, acting as allocator of Krugerrand Coins as set out in clause 9.3 of the Contract; “AM” before noon; “Block” a quantity of 1 000 (one thousand) or more Krugerrand Custodial Certificates; “Business Day” a day other than a Saturday, Sunday or an official public holiday in the Republic of South Africa; “CISCA” the Collective Investment Schemes Control Act 45 of 2002 or any successor Act that may repeal and replace CISCA; “Collection Conditions” (i) providing to the Issuer a Collection Notice (by hand, by e-mail, by facsimile, by registered post or in such other manner as the Issuer may authorize from time to time), together with the statements evidencing the title of the Holder of the relevant Krugerrand Custodial Certificates, and (ii) the Holder giving such instructions as are required by the Issuer for the delisting and cancellation thereof; “Collection Date” the date of actual receipt of a Collection Notice by the Issuer, provided that the Collection Notice is received during JSE trading hours on a Trading Day. If the Collection Notice is