Date:

15 September 2009

Appointment of Sub-contract: Umlilo Protection Management P.O. Box 96552 Johannesburg 2019 Dear Madam, MAIN CONTRACT: Katherine Street Hotel We have pleasure in appointing you as a Selected Sub-contractor for the above contract as follows:A. Details of Sub-contract: 1. 2. 3. Scope of Work: Amount: Fire Sprinkler Installation R 2,989,776.54 inc VAT

Items forming Sub-contract Agreement See Annexure A

B.

Terms of Sub-contract: 1. 2. Principal Agents letter dated 11 August 2009 as attached, instructing us to appoint you as a Selected Sub-contractor. Save as varied or added to by the terms of this letter, the Conditions of Subcontract are the latest edition, with amendments, of the JBCC Nominated/Selected Sub-Contract Agreement in force as at the date of submission of offer. It is an express condition of this Letter of Appointment that a Construction/Performance Guarantee as set out in Clause 14.0 of the above referred Conditions of Sub-contract be lodged in this office within fourteen

3.1

days of receipt of this Letter of Appointment, failing which we reserve the right to terminate this agreement. 3.2 That proof of your insurance requirements, as listed below, are submitted by yourselves along with this signed Letter of Appointment. a) b) c) Public Liability for the sum of: R5,000,000.00 Workmens Compensation: Plant and other property: Copy of letter of good standing

4.0 The sub-contractor acknowledges that he is aware of the standard provisions of the Principal Contract, and that all the provisions of the Principal Contract requiring observance, performance or compliance on the part of the contractor shall be observed, performed and complied with by the subcontractor insofar as they relate and apply to the sub-contract works, and are not repugnant to or inconsistent with the express provisions of the subcontract as if all the same were severally set out herein. C. Programme Requirements: 1. 2. 3. Main Contract Period: 13 May 2009 12 August 2010 Penalties for Non-completion in terms of clause 30: R64, 500.00/calendar day The programme for the Principal Contract is maintained on site.

It is your responsibility within fourteen days of receiving this letter, to liaise with the site manager for your programme requirements, which are to be confirmed in writing by ourselves. 4. Actual progress may vary, and the onus is therefore placed on yourselves to liaise with our site personnel at the time periods that they will require, to ensure that your programme is brought into line with the overall achieved progress.

D.

Payments: 1. 2. 3. Retention: : Interim Certificate Maximum 10% 5%

Increase Costs: Rates are fixed for the duration of the contract Interim claims are to be submitted monthly to site before the 22nd of each month in sufficient detail reflecting the total value of work done to date.

VAT invoices are to be submitted to Concor House, PO Box 8259, Johannesburg 2000, marked for the attention of the Accounts Department. 4. The due date for payment to the Sub-Contractor is conditional upon Concor having received payment on due date from the Client.

5. E.

The Sub-Contractor is to provide banking details as per annexure B

Principal Contract Personnel: 1. 2. 3. 4. Contracts Manager: Site Agent: Contract Quantity Surveyor: Jackie Todd General Foreman: Kevin Butler

F.

Additional Conditions: 1. Special Conditions of Sub-Contract as per annexure A

We refer you to the particular requirements of the following as set out in the main contract agreement: a. BEE participation and goals b. HIV / Aids awareness c. Environmental management G. Safety: The Sub-Contractor shall at all times comply with the Occupational health & Safety Act No. 85 (1993) and with the requirements of annexure C H. Illegal Alien Declaration: The sub-contractor on signing this Letter of Appointment, hereby declares that he has no persons in his employ who would be classified as an Illegal Alien in terms of the Aliens Control Act No. 96 of 1991 and hereby indemnifies Concor Trencon JV against any loss liability claim or proceedings whatsoever arising out of the subcontractors non-compliance with the said Act no. 96 of 1991. I. Acceptance: This Letter of Appointment will form the basis of the Sub-contract Agreement between the sub-contractor and the main contractor. It has been sent to you in duplicate and it is a requirement that you sign in the space provided and initial each page and return a signed copy to this office within fourteen days of receiving this Letter of Appointment. If the sub-contractor is a company, then the signatory to this agreement is to enclose a Resolution by the Board of Directors granting authorization for the signatory to sign acceptance as per annexure D

Yours faithfully CONCOR

Contracts Director G. Cook

Contacts Manager K. Butler

Quantity Surveyor J. Todd

We hereby accept the appointment of ourselves as Sub-contractor/Supplier and agree to the terms and conditions stated herein. Dated at this day of 19

For and behalf of: (Authorised Signatory) Sub-Contractors domicilium citandi et executandi Domicilium (Physical address) Code.. Telephone Fax No ANNEXURE A

Special Conditions of Sub-Contract Agreement

The following Special Conditions form take precedence over existing JBCC Nominated/Selected Sub-contract Conditions of Sub-Contract agreement. GENERAL NOTES: 1. The Principal Contract entered into between the Employer and the Contractor is the JBCC 2000 Series Principal Building Agreement March 2005 Edition as prepared by the Joint Building Contracts Committee Inc and recommended by the JBCC constituents, namely Association of South

African Quantity Surveyors, Building Industries Federation (South Africa), South African Association of Consulting Engineers, South African Institute of Architects, South African Property Owners Association and Specialist Engineering Contractors Committee. 2. The sub-contractor is referred to the Nominated/Selected Sub-contract agreement recommended by the Joint Building Contracts Committee, March 2005 (the JBCC sub-contract agreement) for the full intent and meaning of each clause thereof. Any modifications/corrections as may apply to the standard Nominated/Selected Sub-contract Agreement are incorporated hereinafter. 3. Any terms and conditions contained in the sub-contract quotation do not form a part of this sub-contract agreement unless specifically reduced to in writing herein.

ALTERATIONS AND AMMENDMENTS: Cl. 3.1 Cl. 4 This clause is deleted and shall not apply to this sub-contract agreement In the event of the sub-contract appointment including for Design, this clause is supplemented by the addition thereto of the following subclauses:

4.4

Notwithstanding the provisions of 4.2 there shall be and is an obligation on the sub-contractor, simultaneously with the signing of the Sub-contract agreement, to sign (in terms of a suitable written signing authority produced to and acceptable to the Principal Agent) and deliver the original to the contractor for onward transmission to the employer a Design Materials and Workmanship Warranty and Undertaking in favour of the employer which shall conform to the specimen Design Materials and Workmanship Warranty and Undertaking as specified in annexure E and/or drawn up by the Principal Agent. The sub-contractor shall be solely responsible for the suitability, efficiency and correctness of the sub-contract works. It is recorded that the sub-contractor acknowledges that he is an expert in his field with expert knowledge of every aspect thereof,

4.5

that this is the principal reason for his appointment, and he undertakes to effect the installation to the satisfaction of the Principal Agent and all authorities and that notwithstanding any approvals, comments, advice or information provided by any party whatsoever, the sub-contract works shall be installed as to function efficiently and effectively to the satisfaction of the Principal Agent and all authorities. 4.6 The efficiency and correctness of the design contained in these documents is the responsibility of the sub-contractor who shall ensure that the quality of workmanship and the installation meets the requirements of the specification and is done in such a manner that the performance matches or exceeds the specifications published by the manufacturers and/or suppliers. The sub-contractor by entering into this sub-contract shall be deemed to have offered his services, workmanship, materials and equipment to meet all the requirements of the specification and shall further be deemed to have ensured that the suppliers and manufacturers of the equipment installed by him under this subcontract will manufacture and supply such equipment to perform within the recommended limits of the manufacturers design and performance figures as well as to comply with the specification supplied.

4.7

Cl. 10.4

Additional clause added: Any insurance claims affected under the principal agreement shall become due and payable to the sub-contractor when and to the extent that the contractor is compensated for the sub-contractors portion of the claim in this respect less any deductible which the sub-contractor is liable for.

Cl. 14.1

This clause is amended by replacing the phrase twenty one (21) calendar days with the phrase fourteen (14) calendar days and adding the following sentence to the end of the clause. Security selected by the subcontractor in accordance with 14.3 or 14.4 shall be issued by an approved financial institution.

Cl. 15.4

This clause is deleted and shall not apply to this sub contract agreement.

Cl. 17.3.1 New clause added: Instructions issued to the sub-contractor by the contractor shall only be valid if issued in writing and signed by the contractors contract director or his authorized representative. Cl. 18.5 New clause added: The sub-contractor shall take site dimensions prior to the commencement of any sub-contract works and shall immediately notify the contractor of any discrepancy arising relative to the drawings. On being given access to the working area the sub-contractor shall check the dimensional accuracy of the work previously executed. Should there be any discrepancies the sub-contractor shall notify such discrepancies to the contractor in writing within three (3) working days of being given access. If the sub-contractor fails to give this notification within the prescribed period it shall be deemed that sub-contractor accepts that the previously executed work is within the specified tolerances.

Cl. 20.1.2 This clause is amended with the inclusion of the following at the end of the clause: The contractor shall be entitled to deduct monies from the subcontractors certified amount in circumstances where the subcontractor is found to be using the contractors water, fuel and/or power supply for commissioning. The subcontractor shall be solely responsible for contacting the contractor to ascertain the costs involved as no claims whatsoever shall be entertained as a consequence of the subcontractors failure to contact the contractor. Cl. 20.1.3 This clause is deleted in its entirety and replaced with the following: The provision of a limited area (if available) for the sub-contractor to establish temporary office accommodation and workshops and for the storage of plant and materials and goods. The sub-contractor may however be required to move his establishment from time to time and

shall allow for such occurrences in his tender pricing as under no circumstances will any costs in this regard be entertained. Cl. 20.1.6 This clause is deleted in its entirety and replaced with the following: The use of site telephone, facsimile machine, site security, access control points, induction facilities and protective clothing, where provided, subject to the payment by the subcontractor for the usage thereof. The subcontractor shall be solely responsible for contacting the contractor to ascertain the costs involved and no claims and/or costs whatsoever shall be entertained as a consequence of the subcontractors failure to contact the contractor. Cl. 20.1.7 New clause added: Should the sub-contractor use the contractors facilities as listed in subclauses 20.1.4 and 20.1.5 in a fashion that the contractor incurs additional expense; the contractor shall be entitled to recover such expense from the sub-contractor for the use of such facilities at open market rates.

CL.20.1.8 New clause added: The subcontractor to provide his own task lighting at no additional cost. Cl. 21.3 This clause is amended with the addition of the following to the end of the clause: Should the sub-contractor require to make use of the contractors equipment, crane, scaffolding, or hoisting facilities, the contractor shall be entitled to recover the costs of the usage thereof from the subcontractor at open market rates. Cl. 21.4 New Clause Added: The sub-contractor shall regularly clear away all rubbish, debris and excess materials resulting from his execution of the sub-contract works

and/or from his employees and maintain the works and the sub-contract works in a clean and satisfactory state to the reasonable satisfaction of the contractor. Such rubbish, debris and excess materials shall be removed off site by the sub-contractor as the works proceed. In the event that this condition is not adhered to, the contractor shall instruct the sub-contractor in writing giving the subcontractor 72 hours notice to rectify the situation. Should the subcontractor fail to perform the task after receipt of such instruction from the contractor, the contractor may then execute the task on behalf of the sub-contractor and the contractor shall then be entitled to recover all costs related thereto, as calculated at day work rates from the sub-contractor, in accordance with Clause 33.0. Cl.31.9.1 This clause is omitted Cl.31.9.2 This Clause is replaced with the following: Be made fourteen (14) calendar days after the contractor has received payment from the employer and subject to the subcontractor providing the contractor with a tax invoice for the amount due prior to receiving such payment. Cl.31.15 This clause is omitted

Cl.31.15.1 This clause is omitted Cl 31.15.2 This clause is omitted Cl.34.10.2 This Clause is replaced with the following: Be made fourteen (14) calendar days after the contractor has received payment from the employer and subject to the subcontractor providing the contractor with a tax invoice for the amount due prior to receiving such payment. Cl.34.11 This Clause is amended by replacing the phrase practical completion in the third line with the phrase final completion

Cl.34.11.1 The following new Clause is added:

The contractor shall only be liable to pay the subcontractor compensatory interest in the event of the employer paying compensatory interest to the contractor. Cl.34.14 This Clause is replaced with the following: Where the employer fails to pay the contractor the amount included in the final certificate in terms of the principal agreement the contractor shall notify the subcontractor within five (5) working days of the employers default. Cl.34.14.2 This Clause is deleted. Cl.34.15.1 This Clause is amended by replacing the phrase in terms of 34.10 at the end of the sentence with the phrase in terms of 34.10.2 Cl.34.15.2 This Clause is amended by replacing the phrase in terms of 34.10 or 34.14.1 at the end of the sentence with the phrase in terms of 34.10.2 or 34.14.1 Cl.34.15.3 This Clause is deleted. Cl.38.5.6 This Clause is amended with the inclusion of the following at the end of the clause: to the extent that it is certified as due for payment to the sub-contractor under the principal agreement.

ANNEXURE B Sub-contractors Banking Detail

Sub-contractor Name:

Account Name:

Bank:

Branch:

Branch Code:

Account Number:

Account Type:

ANNEXURE C Safety Appointment/Appointment of Contracting Supervisor Notes:

1. No sub-contractor or supplier of plant shall be allowed to commence with any work

on the Project until such a time as the Mandatory Agreement is put in place.

2. The sub-contractor shall simultaneously with the Mandatory Agreement provide

the following;

 Letter of good standing from the Workmans Compensation Commissioner. Appointment 11(i) of the sub-contractors responsible person for the Project Appoint a Safety Representative who shall represent the sub-contractor at monthly Safety Meetings 3. The sub-contractor shall also be responsible for; Providing certified First Aiders for the subcontractors employees, failing which an agreement must be entered into between the sub-contractor and the Contractor for the use of the Contractors First Aiders. Any costs arising from the use of the Contractors First Aiders shall be soley for the account of the sub-contractor. Submitting monthly safety reports to the Contractor. Compiling and submitting a Risk Assessment for the work which the sub-contractor is employed to execute. Abide to all safety rules and regulations as may be applicable to the Project. Sign a copy of the Contractors safety rules on the Project. Adhere to Risk Assessments supplied by the Contractor. Attend and induction course to be presented by the Contractor. The cost of the induction course shall be for the subcontractors account and the sub-contractor is advised to contact the Contractor to ascertain the costs thereof. No costs will be entertained as a consequence of the sub-contractors failure to provide for the costs hereof.

APPOINTMENT OF CONTRACTING SUPERVISOR of __________________________________ Section 8(2)

(e) (i)

Providing such information, training may be necessary to ensure, as far as is reasonably practicable, the health and safety work of his employees; ensure that work is performed and that plant or machinery is used under the general supervision of a person trained to understand the hazards associated with it, and who has the authority to ensure that precautionary measures taken by the employer are implemented; and causing all employees to be informed regarding the scope of their authority as contemplated in section 37(1)(b).
.. (name) as the for: (project/site) hereby appoint/authorise at . Close (Company,

(j)

.. ..

SUPERVISOR

Corporation/Enterprise/Owner/User) Special Instructions/Information: .. Signed:.. Date:.

ACCEPTANCE OF APPOINTMENT/AUTHORISATION I accept and understand the requirements of this appointment/authorization. Signed: . Date:

Special Training/Certificate : .

ANNEXURE D BOARD RESOLUTION

RESOLUTION OF THE BOARD OF DIRECTORS OF

----------------------------------------------------------------------HELD AT __________________ ON THE _________ DAY OF __________________ 20 ______________

RESOLVED: that ___________________________________ in his capacity as a Director of the Company, is hereby authorised to enter into and sign contract and other documents for and on behalf of the Company in all matters relating to the contract mentioned below. CONTRACT NAME: ____________________________________

COMPANY NAME: ____________________________________ CERTIFIED A TRUE COPY

SIGNED:

____________________ DIRECTOR / MEMBER

ANNEXURE E Form of Indemnity for Design of the Contract Works

For:

(Description of Sub-Contract Works)

 (the Employer) WE, (the Sub-Contractor) do hereby jointly and severally indemnify and hold harmless, The Employer: The Principle Agent: The Contractor(s): Principal Contract Date:

or any one or more of them from liability for any claim which may be made against any of the above parties by any person whatsoever or any loss or damage whatsoever which the parties may suffer arising out of any defect in design, detailing, calculations, manufacturing and erection of the work to the extent undertaken by the Sub-contractor in terms of a certain Contract between the Contractor and Sub-contractor dated:__________________. In the event of any of the aforesaid parties receiving any claim or suffering any loss or damage as aforesaid, such party shall forthwith notify the Contractor and the Sub-contractor by registered post and shall furnish the Contractor and the Sub-contractor of details of such claim, loss or damage. The Sub-contractor shall be obliged within 60 days of the date of posting such registered notification rectify and/or make payment to the addressor of such notice of the amount of such claim, loss or damage or alternatively to provide security to the satisfaction of such addressor for the full amount of such claim or damage. SIGNED BY THE SAID SUB-CONTRACTOR THIS _____ DAY OF ______________ 20____.

WITNESS:________________________

SUB-CONTRACTOR: ___________________