Memorandum of Agreement

Exhibit 4.120

A1896

Execution Version
ISL/HD
030807

Memorandum of Agreement

Made and entered into between:-

ANGLOGOLD XXXXXXX LIMITED

(Reg No 1944/017354/06)

(a company duly incorporated in accordance with the company laws of the Republic of
South Africa with limited liability, herein represented by Xxxxxx Xxxxx Xxxxxx, he being
duly authorised hereto under and by virtue of a Delegation of Authority Policy which was
approved by the Audit and Corporate Governance Committee of the board of directors of
the company passed at Johannesburg on the 24

day of October 2003, and a certified

copy whereof is annexed hereto marked "A");

of the first part;

and

FRIEDSHELF 849 (PROPRIETARY) LIMITED

(Reg No 2007/004886/07)

(a company duly incorporated in accordance with the company laws of the Republic of
South Africa with limited liability, herein represented by Diederik Xxxxxx Xxxxxx van der
Xxxx, in his capacity as a director thereof, he being duly authorised hereto under and by
virtue of a resolution of the board of directors of the company passed at Johannesburg on
the 3

day of August 2007, and a certified copy whereof is annexed hereto marked "B");

of the second part;

and

DRDGOLD SOUTH AFRICAN OPERATIONS (PROPRIETARY) LIMITED

(Reg No 2005/033662/07)

(a company duly incorporated in accordance with the company laws of the Republic of
South Africa with limited liability, herein represented by Xxxxxx Xxxxxxxxx, in his capacity as
a director thereof, he being duly authorised hereto under and by virtue of a round
resolution passed in and during June 2007, and a certified copy whereof is annexed
hereto marked "C");

of the third part;

and

MINTAILS SOUTH AFRICA (PROPRIETARY) LIMITED

(Reg No 2004/007547/07)

day of August 2007, and a certified copy whereof is annexed hereto marked "D");

of the fourth part.

Definitions

1.1

In this agreement, unless inconsistent with the context, the following terms and/or

expressions shall have the separate meanings assigned to them hereunder and for

purposes of convenience the said definitions are reflected throughout this

agreement in capitals:-

1.1.1 “AGA”

shall mean AngloGold Xxxxxxx Limited

and shall be deemed to include its

successors in title;

1.1.2 “AGREEMENT”

shall mean this agreement between the

PARTIES and shall be deemed to

include all annexes thereto which shall

be initialled or signed, as the case may

be, by the PARTIES for purposes of

identification;

1.1.3 “ATTORNEYS”

shall mean Levy, Feinsteins &

Associates Incorporated practising

under the style of “Feinsteins” of

Johannesburg, RSA;

1.1.4 “BENONI CLUSTER”

shall mean the sand and slime dumps

resources situate across the entire area

of what is generally known and

described as “the Benoni Cluster” and

in no way derogating from the

generality thereof in the area delineated

in blue and yellow on the drawing

annexed hereto marked “E”;

1.1.5 “CLOSING DATE”

shall mean the date of the fulfilment or

waiver of the last of the conditions

precedent in clause 3 infra or at latest 5

(five) business days thereafter;

1.1.6 “COMPETITION

COMMISSION”

shall mean the Commission established

in accordance with the provisions of the

Competition Act, No 89 of 1998, as

amended, of the RSA;

1.1.7 “CONVERSION DATE”

shall mean the date, prior to the 30 April

2009, of the conversion of the ERGO

MINING RIGHTS from OLD ORDER

MINING RIGHTS to NEW ORDER

MINING RIGHTS, by the DME in terms

of the MPRDA;

1.1.8 “CPI”

shall mean the official Consumer Price

Index for Gauteng, RSA as determined

from time to time by the Director of

Statistics and as published in the

Government Gazette and in the absence

thereof as determined by the auditors of

AGA by reference to such other criteria

as they in their discretion may deem

apposite and whose decision in such

regard and in the absence of manifest

error shall be final and binding;

1.1.9 “DME”

shall mean the Department of Minerals

and Energy of the RSA;

1.1.10 “DRD SA”

shall mean DRDGold South African

Operations (Proprietary) Limited (a

subsidiary of DRDGold Limited), and

shall be deemed to include its

successors in title;

1.1.11 “EFFECTIVE DATE”

shall mean the 11 June 2007,

notwithstanding the SIGNATURE

DATE;

1.1.12 “EMP”

shall mean the Environmental

Management Programme, including the

closure plan, pertaining to the ERGO

ASSETS and as approved in writing by

the DME from time to time;

1.1.13 “ENVIRONMENT”

shall mean the environment, including

without limitation, atmosphere, surface

water, ground water, land surface, soil,

sub-surface strata and plant and animal

life including (without limitation) the

meaning ascribed to that term in the

National Environmental Management

Act, No 107 of 1998;

1.1.14 “ERGO ASSETS”

shall, in relation to the ERGO

OPERATIONS, collectively mean the:-

1.1.14.1

BENONI CLUSTER;

1.1.14.2

ERGO DESIGNATED

RIGHTS;

1.1.14.3

ERGO DUMPS;

1.1.14.4

ERGO MINING ASSETS;

1.1.14.5

ERGO MINING RIGHTS;

and

1.1.14.6

SITE,

to the exclusion, however, of the

EXCLUDED ASSETS;

1.1.15 “ERGO DESIGNATED

RIGHTS”

shall mean all the registered rights of

whatsoever nature and howsoever

arising, including without derogating

therefrom, servitudes or otherwise, of

and in connection with the BENONI

CLUSTER and the ERGO DUMPS

including those rights more fully

detailed in a schedule thereof annexed

hereto and marked “F”;

1.1.16 “ERGO DUMPS”

shall mean the sand and slime dumps

resources situate across the entire

areas formerly comprising and known

and described as the ERGO

OPERATIONS and in no way

derogating from the generality of the

aforegoing as more fully delineated in

yellow on the drawing annexed hereto

marked “E”;

1.1.17 “ERGO MINING

ASSETS”

shall mean the piping and related

mining equipment of the ERGO

OPERATIONS as more fully set forth in

a schedule thereof annexed hereto and

marked “G”;

1.1.18 “ERGO MINING

RIGHTS”

shall, in relation to the applicable

ERGO ASSETS, mean AGA’s existing

OLD ORDER MINING RIGHTS (to be

converted to NEW ORDER MINING

RIGHTS) in respect of the ERGO

OPERATIONS entitling AGA or any

subsequent holder thereof to conduct

mining and allied operations on and

from the BENONI CLUSTER, the

ERGO DUMPS and the SITE or any

component thereof and in no way

derogating from the generality thereof

as more fully delineated in yellow on

the drawing annexed hereto and

marked “E”;

1.1.19 “ERGO OPERATIONS”

shall mean the mining and ancillary

operations comprising the ERGO

ASSETS, to the exclusion of the

EXCLUDED ASSETS;

1.1.20 “EXCLUDED ASSETS”

shall mean the following assets which

shall be expressly excluded from the

ERGO ASSETS and the ERGO

OPERATIONS, to wit:-

1.1.20.1 the Brakpan and Withok

Tailings Storage Facilities -

which remain the property of

AGA including the

rehabilitation and

environmental management

liability therefor;

1.1.20.2 the Brakpan plant and

storage facilities - which

have been acquired by

HVH Gold (Proprietary)

Limited (the ultimate

controlling company

whereof is MINTAILS AUS);

and

1.1.20.3

the East Daggafontein plant

and adjacent property -

which have been acquired

by Skeat Gold Mining East

Rand (Proprietary) Limited

and HVH Gold (Proprietary)

Limited (both of which

companies are ultimately

controlled by MINTAILS

AUS);

1.1.20.4 the buildings generally

known and described as the

farmhouse and change

house near the Brakpan

Tailings Storage Facility,

which shall remain the

property of AGA, including

any liability attaching

thereto; and

1.1.20.5 freehold land (agricultural

land) more fully detailed in a

schedule thereof annexed

hereto marked “H”, which

shall remain the property of

AGA including any liability

attaching thereto;

1.1.21 “INTERIM PERIOD”

shall mean the period calculated from

the EFFECTIVE DATE to the

CLOSING DATE;

1.1.22 “LEGISLATION”

shall, in no way derogating from the

generality of such term, mean that

which is applicable to the ERGO

ASSETS including:-

1.1.22.1 National Environmental

Management : Air Quality

Act, No 39 of 2004;

1.1.22.2 Conservation of Agricultural

Resources Act, No 43 of

1983;

1.1.22.3 Environment Conservation

Act , No 73 of 1989;

1.1.22.4

LRA insofar as same refers

to environmental protection

and development;

1.1.22.5

MPRDA;

1.1.22.6 Mine Health and Safety Act,

No 29 of 1996;

1.1.22.7

National Water Act, No 36 of

1998; and

1.1.22.8 The National Environmental

Management Act, No 107 of

1998;

1.1.23 “LRA”

shall mean Labour Relations Act No. 66

of 1995, as amended, of the RSA;

1.1.24 “MINTAILS AUS”

shall mean MinTails Limited, a public

company duly incorporated in

accordance with the laws of Australia

and the shares whereof are listed on

the Australian Stock Exchange;

1.1.25 “MINTAILS SA”

shall mean MinTails South Africa

(Proprietary) Limited (a wholly owned

subsidiary of MINTAILS AUS), and

shall be deemed to include its

successors in title;

1.1.26 “MPRDA”

shall mean the Mineral and Petroleum

Resources Development Act, No 28 of

2002, as amended, of the RSA;

1.1.27 “NEWCO”

shall mean Friedshelf 849 (Proprietary)

Limited and shall be deemed to include

its successors in title, and the beneficial

shareholders whereof are DRD SA and

MINTAILS SA in equal shares;

1.1.28 “NEW ORDER MINING

RIGHTS”

shall have the meaning ascribed

thereto in the MPRDA;

1.1.29 “OLD ORDER MINING

RIGHTS”

shall have the meaning ascribed

thereto in the MPRDA;

1.1.30 “PARTIES”

shall mean all four parties to the

AGREEMENT;

1.1.31 “PRIME”

shall mean the publicly quoted basic

annual rate of interest certified by any

manager of The Standard Bank of South

Africa Limited (whose appointment and

authority need not be proved) to be

charged by the aforesaid bank from time

to time on overdrawn current accounts

of its most favoured private sector

clients;

1.1.32 “RESOLUTIVE

CONDITIONS”

shall, subject to the fulfilment or waiver,

as the case may be, of the conditions

precedent in clause 3 infra, mean the

conditions more fully set forth in clause

4 infra;

1.1.33 “RSA”

shall mean the Republic of South

Africa;

1.1.34 “SIGNATURE DATE”

shall mean the date of signature of the

AGREEMENT by the PARTY last

signing same;

1.1.35 “SITE”

shall mean the East Daggafontein

Tailings Storage Facility and as

delineated in red on the drawing

annexed hereto marked “I”;

1.1.36 “SUB-CONTRACTING

AGREEMENT”

shall mean the agreement to be entered

into by and between AGA as sub-

contractor and NEWCO as sub-

contractee with regard to the utilisation

of the ERGO ASSETS by NEWCO for

its own benefit and account from the

CLOSING DATE until:-

1.1.36.1 the CONVERSION DATE;

and

1.1.36.2 the transfer, cession and

assignment of the NEW

ORDER MINING RIGHTS,

in terms of the conversion,

into the name of NEWCO in

terms of the MPRDA,

and on the basis that should the ERGO

MINING RIGHTS not have been

converted to NEW ORDER MINING

RIGHTS and transferred and assigned

unto and in favour of NEWCO by the 30

April 2009, then and in such event the

sub-contracting agreement shall

continue for a period of 10 (ten) years

thereafter with the right and option in

favour of NEWCO to renew the same

for an additional 5 (five) years and

during which period NEWCO shall be

entitled to make application for NEW

ORDER MINING RIGHTS in its own

name in substitution for the ERGO

MINING RIGHTS;

1.1.37 “SURETIES” shall mean DRD SA and MINTAILS

SA, whose obligations as such in

favour of AGA shall be joint and

several;

1.1.38 “SURETYSHIP”

shall mean the Deed of Suretyship to

be executed by the SURETIES in

favour of AGA and substantially as set

forth in the specimen thereof annexed

hereto and marked “J”;

1.1.39 “TERM SHEET”

shall mean the term sheet entered into

by and between the PARTIES at

Johannesburg, RSA on the 5 June

2007 in terms whereof NEWCO agreed

to acquire from AGA the ERGO

ASSETS for the consideration and

upon the salient terms and conditions

therein set forth, it being recorded that

the time lines therein contained were

orally extended from time to time;

1.1.40 “TRADE XXXX/TRADE

NAME”

shall mean the trade name ‘Ergo”, and

any other trademarks and logos bearing

such name or similar thereto, whether

registered or not;

1.1.41 “TRANSACTION”

shall mean the transaction which

constitutes the subject matter of the

AGREEMENT between the PARTIES;

1.1.42 “VAT ACT”

shall mean the Value Added Tax Act,

No 89 of 1991, as amended, of the

RSA;

1.1.43 “ZAR” / “RAND” shall mean the currency of the RSA.

1.2 Words importing:-

1.2.1

the singular shall include the plural and vice versa;

1.2.2

any one gender shall include the others;

1.2.3

persons shall, where the context admits, include firms or

corporations.

1.3

Where figures are referred to in numerals and words, then the latter shall prevail in

the event of any dispute.

1.4

Any reference to a statute, regulation or other legislation shall be a reference to

such statute, regulation or other legislation as at the date of signature of these

presents and as amended or substituted from time to time.

1.5

When any number of days is prescribed in the AGREEMENT, same shall be

business days and shall be reckoned exclusively of the first and inclusively of the

last day unless the last day falls on a Saturday, Sunday or public holiday in the

RSA, in which case the last day shall be the next succeeding business day which is

not a Saturday, Sunday or public holiday.

1.6

The use of the word “including” followed by a specific example/s shall not be

construed as limiting the meaning of the general wording preceding it and the

eiusdem generis rule shall not be applied in the interpretation of such general

wording or such specific example/s.

1.7

Where any term is defined within a particular clause other than as set forth in this

clause 1, then that term shall bear the meaning ascribed to it in that clause

wherever it is used in the AGREEMENT.

1.8

The terms of the AGREEMENT having been negotiated, the contra proferentem

rule shall not be applied in the interpretation thereof.

1.9

Any term which refers to a RSA legal concept or process (in no way derogating

from the generality thereof, for example “winding-up” or “curatorship”) shall be

deemed to include a reference to the equivalent or analogous concept or process

in any other jurisdiction in which the AGREEMENT may apply or to the laws of

which any party cited hereunder may be or become subject.

Recordal

It is recorded that:-

2.1

AGA is the lawful holder of the ERGO ASSETS;

2.2

AGA is desirous of selling and/or ceding and assigning all its right, title and interest

in and to the ERGO ASSETS to NEWCO, which is desirous of acquiring the same

from AGA;

2.3

to facilitate the sale, transfer, cession and assignment of the ERGO ASSETS from

AGA to NEWCO, it is necessary as a pre-requisite thereto for AGA to procure the

approval by the DME of the conversion of the ERGO MINING RIGHTS from OLD

ORDER MINING RIGHTS to NEW ORDER MINING RIGHTS;

2.4

pending the arrival of the CONVERSION DATE, NEWCO is nevertheless desirous

of:-

2.4.1 conducting the ERGO OPERATIONS utilising the ERGO ASSETS; and

2.4.2

accordingly concluding the SUB-CONTRACTING AGREEMENT with

AGA,

with effect from the CLOSING DATE;

2.5 the PARTIES reached agreement in principle in regard to the aforegoing and

accordingly executed the TERM SHEET; and

2.6

in amplification of the TERM SHEET and as therein provided, the PARTIES have

agreed to enter into a more comprehensive agreement as more fully set forth

hereafter.

Conditions Precedent

3.1

Notwithstanding anything to the contrary in the AGREEMENT contained, it shall be

subject to the fulfilment of the following conditions precedent, to wit:-

3.1.1

the execution of the SUB-CONTRACTING AGREEMENT by the

respective parties thereto; and

3.1.2

the execution of the SURETYSHIP by the respective parties thereto;

within a period of 14 (fourteen) days after the SIGNATURE DATE and which

documents shall be held by the ATTORNEYS ‘in trust’ pending the arrival of the

CLOSING DATE and the implementation of the provisions of clause 13 infra; and

3.1.3

the written approval, to the extent necessary, of the COMPETITION

COMMISSION - within a period of 120 (one hundred and twenty) days

after the fulfilment of the last of the remaining conditions precedent as

set forth in clauses 3.1.1 and 3.1.2 supra.

3.2

The aforegoing conditions are stipulations for the benefit of AGA and NEWCO and

accordingly shall only be capable of being waived (to the extent possible) in writing

by them.

3.3

Should any of the aforesaid conditions precedent not be fulfilled or waived (where

possible) within the period/s stipulated in clause 3.1 supra or within such extended

period as the affected PARTY may in writing agree upon, then and in such event

the AGREEMENT shall ipso facto be and become null and void ab initio and the

PARTIES shall be obliged to restore each other as near as possible to the status

quo ante as at the SIGNATURE DATE and none of the PARTIES shall have any

claims against the other/s of them save in the event of a breach of the provisions of

clause 3.4 infra provided, however, that if any of the conditions precedent are

waived, then and in such event same shall ipso facto be deemed to have been

converted to irrevocable undertakings by the relevant PARTIES in favour of AGA

or NEWCO, as the case may be, to be fulfilled within a period of 14 (fourteen) days

after written demand therefor, failing which AGA or NEWCO, as the case may be,

shall without prejudice to its rights, be entitled to take such action against the

defaulting PARTY as it in its sole and absolute discretion may deem fit and either

claim specific performance or cancellation of the AGREEMENT, including in either

event a claim for damages sustained by it. Notwithstanding the aforegoing, if the

waiver is due to an impossibility of performance, then it shall not be converted into

an undertaking.

3.4 The PARTIES reciprocally warrant in favour of each other that they will in good

faith use their reasonable commercial endeavours to timeously procure the

fulfilment of the conditions precedent which are applicable to them and to such end

shall supply such information and/or execute such reasonable documentation as

may be required by any third party, be it regulatory authorities or otherwise, in

relation to the said conditions within a period of 5 (five) business days after a

written request therefor.

RESOLUTIVE CONDITIONS

4.1

Subject to the timeous fulfilment or waiver, as the case may be, of the conditions

precedent in clause 3 supra, the AGREEMENT shall be further subject to the non-

fulfilment of the following RESOLUTIVE CONDITIONS, to wit:-

4.1.1

the failure of AGA to procure the conversion of the ERGO MINING

RIGHTS from OLD ORDER MINING RIGHTS to NEW ORDER MINING

RIGHTS; and

4.1.2

the failure of AGA and NEWCO to procure the sale and/or transfer,

cession and assignment of the ERGO MINING RIGHTS after

conversion, to NEWCO,

within a period of 5 (five) years after the CLOSING DATE or within such extended

period/s as the PARTIES may in good faith in writing agree upon, save that should

either one of the aforesaid conditions not be fulfilled prior to the expiration of a

period of 4 (four) years and 6 (six) months calculated from the CLOSING DATE

notwithstanding all reasonable efforts by AGA and NEWCO and through no fault

of either one of them, then and in such event NEWCO shall be entitled to lodge an

application for new mining rights in connection with the ERGO OPERATIONS with

the DME.

4.2

It is recorded that the RESOLUTIVE CONDITIONS are stipulations for the benefit

of AGA and NEWCO and accordingly may only be waived in writing by them, in

whole or in part, as the case may be.

4.3

Should either of the RESOLUTIVE CONDITIONS in clause 4.1 be fulfilled and not

be waived in writing within the time period stipulated or within such extended

period/s as AGA and NEWCO may in writing determine, then and in such event the

SUB-CONTRACTING AGREEMENT shall nevertheless continue, upon the terms

and conditions therein set forth.

4.4 The PARTIES reciprocally warrant in favour of each other that they will in good

faith use their reasonable commercial endeavours to timeously sign and/or procure

the signature of all necessary documents as may be applicable to the aforegoing,

upon written request therefor.

Warranties

5.1

AGA warrants in favour of the remaining PARTIES and upon the veracity whereof

the AGREEMENT shall be founded that:-

5.1.1

it is the lawful holder of the ERGO MINING RIGHTS;

5.1.2

it will not during the subsistence of the AGREEMENT do any act, matter

or thing which could adversely affect its ability to procure the conversion

of the aforegoing rights from OLD ORDER MINING RIGHTS to NEW

ORDER MINING RIGHTS and the subsequent transfer, cession and

assignment thereof to NEWCO;

5.1.3

it will discharge all and sundry its obligations under and in terms of the

AGREEMENT;

5.1.4

it will furnish, upon written request therefor, NEWCO and/or its duly

authorised representatives with all reasonable documentation in its sole

possession and/or under its control in order to facilitate the

implementation of the provisions of the AGREEMENT;

5.1.5

it shall not be incumbent upon NEWCO to take over any liabilities,

whether for rehabilitation or otherwise, in respect of the EXCLUDED

ASSETS which constitute the subject matter of extraneous agreements;

5.1.6 whilst the TRADE XXXX/TRADE NAME has not been registered by it, it

nevertheless enjoys proprietary rights in respect thereof and which rights

shall pass from AGA to NEWCO as an integral part of the ERGO

ASSETS;

5.1.7

it will upon written request by NEWCO or its duly authorised agents,

execute all documentation necessary for and/or incidental to procuring

as expeditiously as possible:-

5.1.7.1

the conversion of the ERGO MINING RIGHTS from OLD

ORDER MINING RIGHTS to NEW ORDER MINING

RIGHTS; and

5.1.7.2

the assignment of the ERGO DESIGNATED RIGHTS

from AGA to NEWCO.

5.2

Save for the aforesaid warranties, the AGREEMENT is concluded on the basis that

AGA has given no other warranties or representations, whether express or implied.

Acknowledgments, Indemnity and Warranties by NEWCO

6.1

NEWCO acknowledges that:-

6.1.1 its acquisition

the

ERGO ASSETS shall be“voetstoots” in all respects;

6.1.2 from the CLOSING DATE but retrospectively with effect from the

EFFECTIVE DATE, it shall be responsible for the environmental

management, environmental rehabilitation, health and safety and related

costs in relation to the ERGO ASSETS. The environmental

management, environmental rehabilitation, health and safety and related

costs in respect of the ERGO ASSETS shall include but not be limited

to:-

6.1.2.1

if required, the obtaining by NEWCO, as soon as

reasonably possible after the CLOSING DATE, of permits

or certificates required in terms of the LEGISLATION or

any other legislation in respect of the ERGO ASSETS;

6.1.2.2

restoration, anti-pollution measures, anti-flooding

measures, making safe, radiation decontamination,

rehabilitation, compliance with the terms of the EMP,

LEGISLATION, any permit, licence or record of decisions

and implementing any closure plans as approved by the

DME;

6.1.2.3

general compliance with the LEGISLATION;

6.1.2.4

compliance with the safety and health requirements in

terms of the Mine Health and Safety Act, 1996 (Act No. 29

of 1996) and the Occupational Health and Safety Act,

1993 (Act No. 85 of 1993); and

6.1.2.5

compliance with all lawful directives of the relevant

regulatory authorities;

6.1.3

its duly authorised representatives have seen and inspected the ERGO

ASSETS and have concluded various legal and other due diligence

exercises in connection therewith and have expressed their satisfaction

therewith in all respects, it being recorded that it is NEWCO’s intention to

utilise the ERGO ASSETS for mining and allied purposes;

6.1.4

it is further cognisant of the fact that notwithstanding the sale by AGA to

it of the ERGO ASSETS as recorded in the AGREEMENT, it shall not be

possible for AGA to transfer, cede and assign the ERGO MINING

RIGHTS, to the extent required, in respect of the ERGO ASSETS into

the name of NEWCO until after the CONVERSION DATE.

6.2

NEWCO hereby indemnifies and holds AGA harmless in respect of all claims,

damages, losses and/or expenses, which may be made against and/or suffered by

AGA in connection with and/or arising out of any breach by NEWCO of its

obligations in terms of clause 6.1 and/or any breach by NEWCO of the

LEGISLATION.

6.3

NEWCO warrants in favour of AGA that for the INTERIM PERIOD and thereafter,

to the extent applicable:-

6.3.1

it will insure the ERGO ASSETS for a consideration of not less than the

purchase price hereafter referred to and at the cost of NEWCO;

6.3.2

it shall pay the costs of, and assume full responsibility and liability for the

security and asset protection (including insurance against all recognised

hazards) associated with the ERGO ASSETS;

6.3.3

it has the legal capacity and has taken all necessary corporate action

required to empower and authorise it to enter into and implement the

AGREEMENT on the terms and conditions herein set out;

6.3.4

it will, insofar as it is affected thereby, provide all the documents

necessary for the conversion of the ERGO MINING RIGHTS from OLD

ORDER MINING RIGHTS to NEW ORDER MINING RIGHTS;

6.3.5

it will upon written request therefor provide and sign all documents

necessary for and/or incidental to procure the transfer of the ERGO

MINING RIGHTS from AGA into the name of NEWCO after the

CONVERSION DATE and will effect payment of all legal and ancillary

costs associated therewith upon request therefor;

6.3.6

it will at all times comply with the LEGISLATION and its obligations

under and in terms of the AGREEMENT.

Sale

Subject to the fulfilment or waiver, as the case may be, of the conditions precedent in

clause 3 supra and the arrival of the CLOSING DATE (and hence the implementation of

the provisions of clause 13 infra) and subject further to the warranties, acknowledgments

and indemnities hereinbefore and hereinafter contained and the non-fulfilment of the

RESOLUTIVE CONDITIONS:-

7.1

AGA does hereby sell, cede and assign to NEWCO which does hereby purchase

and take cession from it "voetstoots", the ERGO ASSETS; and

7.2

the benefits of and the risks attaching to the aforesaid acquisition and cession shall

pass from AGA to NEWCO retrospectively from the EFFECTIVE DATE.

Purchase Consideration and Payment thereof

8.1

The purchase consideration payable by NEWCO to AGA for the ERGO ASSETS

shall be the aggregate of the amounts due in terms of sub-clauses 8.2 to 8.4 infra,

which shall be allocated as provided in Annexe “K” hereto and be payable as

hereinafter set forth.

8.2

The consideration payable by NEWCO to AGA attributable to the ERGO ASSETS

(save the BENONI CLUSTER for which express provision is made in terms of

clause 8.3 infra) shall be the agreed sum of ZAR42 800 000,00 (forty two million

eight hundred thousand RAND) plus Value Added Tax plus interest at PRIME on

the outstanding balance from time to time determined and payable on a monthly

basis, as to:-

8.2.1

ZAR7 000 000,00 (seven million RAND) plus Value Added Tax on the

SIGNATURE DATE, which amount shall constitute a non-refundable

deposit, whether the AGREEMENT is ultimately rendered unconditional

or not; and

8.2.2

the balance of ZAR35 800 000,00 (thirty five million eight hundred

thousand RAND), plus Value Added Tax, in 23 (twenty three) equal

monthly instalments, the first of which shall be payable on the 1 August

2007 and so payable on the first day of each and every succeeding

month to the ATTORNEYS, to be held by them ‘in trust’ and placed in an

interest bearing account pending the arrival of the CLOSING DATE

when the aggregate of the amounts paid plus accumulated interest

thereon as hereafter, shall be released to AGA and whereafter the said

payments shall be made directly by NEWCO to AGA. In such regard it

is recorded that:-

8.2.2.1 the PARTIES are aware that the monies so invested will

be deemed to constitute trust monies as contemplated by,

and subject to the protection of, Section 78 of the

Attorneys Act, No 53 of 1979, as amended, of the RSA;

8.2.2.2

the account will be in the name of the ATTORNEYS and

under their control;

8.2.2.3

the provisions hereof constitute the required written

instruction/authorisation to the ATTORNEYS in

accordance with rule 77.1 of the Rules of the Law Society

of the Northern Province of the RSA to so invest such

funds; and

8.2.2.4

the said funds shall be invested for the benefit of AGA

pending the arrival of the CLOSING DATE, whereupon

the capital sum and the interest which has accrued

thereon shall be released by the ATTORNEYS to AGA.

8.3

The consideration attributable to the BENONI CLUSTER shall be determined in

accordance with the following formula:-

A x B = C

where:-

A = ZAR1,00 (one RAND) (escalated by the CPI on each anniversary

of the EFFECTIVE DATE)

per tonne of material moved, worked or reclaimed by NEWCO

from the BENONI CLUSTER and as determined in accordance

with the standard market verification procedures applicable thereto

and in the event of any dispute, the provisions of clause 17 infra

shall be applicable

the amount payable per month.

The amount determined as aforesaid shall be payable monthly in arrear from the

last day of the month during which mining operations, pursuant to the SUB-

CONTRACTING AGREEMENT, commence on the BENONI CLUSTER or any

part thereof, and so payable on the last day of each and every succeeding month.

In this regard NEWCO shall afford AGA 14 (fourteen) days’ written notice of its

intention to commence mining on any part of the BENONI CLUSTER on or after

the CLOSING DATE.

8.4

In addition to the consideration attributable to the SITE, NEWCO shall on the

SIGNATURE DATE, deliver to AGA a satisfactory financial institution guarantee in

the sum of ZAR23 000 000,00 (twenty three million RAND) in terms whereof AGA

is indemnified in respect of the rehabilitation obligations associated with the SITE,

the said guarantee to be expressed as payable to AGA or its nominee.

Notwithstanding the furnishing of the aforesaid guarantee, AGA and NEWCO shall

evaluate the implementation of the EMP in relation to the ERGO ASSETS from

time to time in order to determine whether the face value of the guarantee can be

reduced and on the basis that if any dispute arises in regard thereto, same shall be

resolved in accordance with the provisions of clause 17 infra.

8.5 Should the RESOLUTIVE CONDITIONS be fulfilled and should AGA have suffered

any damages to the ERGO ASSETS as a result of the work conducted on the

ERGO OPERATIONS by NEWCO, then the latter shall be shall be obliged to

compensate AGA therefor on the basis, however, that NEWCO shall not be liable

for any punitive damages or consequential losses and should the PARTIES be

unable to reach agreement as to the quantum of the compensation, then and in

such event the adjudication provisions of clause 17 shall be applicable in such

regard.

Environment, Health and Safety and Related Costs

9.1

NEWCO shall on the CLOSING DATE, but retrospectively with effect from the

EFFECTIVE DATE, be liable for compliance with all obligations of and in

connection with the ERGO ASSETS and for the payment of all monies in respect

thereof, including without derogating from the generality of the aforegoing, the cost

of all assessment rates, taxes, levies, imposts, sewerage, municipal services and

any other monies due in connection therewith in terms of the applicable

LEGISLATION;

9.2

NEWCO hereby indemnifies and holds AGA harmless in respect of all claims,

damages, loss or other expense which may be made, caused and/or suffered by

AGA in connection with and/or arising out of its use of the ERGO ASSETS, to the

exclusion, however, of any consequential loss.

9.3

AGA shall furnish NEWCO as soon as reasonably possible after the SIGNATURE

DATE, with copies of the EMP, the ERGO DESIGNATED RIGHTS, the ERGO

MINING RIGHTS and permits or certificates required in terms of the

LEGISLATION.

9.4

NEWCO hereby indemnifies and holds AGA harmless in respect of all claims,

damages, losses and/or expenses which may be made against and/or suffered by

AGA in connection with and/or arising out of any breach by NEWCO of its

obligations in terms of this clause 9 and/or any breach by NEWCO of the

LEGISLATION, to the exclusion, however, of any punitive damages and/or

consequential loss.

9.5 With effect from the CLOSING DATE and until NEWCO has been granted the

necessary permits and licences to conduct its operations at the ERGO

OPERATIONS and until, or in the event of, the registration of a servitude, as

hereafter, in respect of the ERGO OPERATIONS, NEWCO shall comply with all of

AGA’s relevant Codes of Practice, Standards, Special Instructions and its EMP and

NEWCO shall respect the ENVIRONMENT.

9.6

Pending the transfer of all relevant accounts by the Ekurhuleni Municipality on the

one hand and Eskom Limited on the other and in relation to the ERGO ASSETS,

from AGA to NEWCO and to the extent required:-

9.6.1

AGA shall provide electricity for the ERGO ASSETS from its

transformer at cost plus 0% (zero per centum). Although AGA

shall use its reasonable endeavours to provide a continuous

supply of electricity, it shall not be liable for any damage or loss

flowing from the interruption, supply or non-supply of electricity;

and

9.6.2

AGA shall maintain and provide an emergency water supply at

legislated pressure at no cost. This water shall, however, be

utilised exclusively for the emergency fire water line which

NEWCO undertakes to maintain according to the prescribed

regulations. AGA shall provide normal water supply at cost

plus 0% (zero per centum).

9.7

NEWCO hereby indemnifies and holds AGA harmless in respect of all claims,

damage, loss and/or expense which may be made against and/or suffered by AGA

in connection with and/or arising out of the use of the ERGO ASSETS and the

associated infrastructure, plant and equipment save that NEWCO shall not be

liable for any punitive damages or consequential losses.

10. Assignment, SUB-CONTRACTING AGREEMENT and DME Approval

10.1 Pending the DME approval and subject thereto and accordingly the conversion of

the ERGO MINING RIGHTS from OLD ORDER MINING RIGHTS to NEW ORDER

MINING RIGHTS and the transfer thereof into the name of NEWCO:-

10.1.1 the PARTIES shall enter into and comply with the provisions of the SUB-

CONTRACTING AGREEMENT; and

10.1.2

in no way derogating from the aforegoing, AGA shall with effect from the

CLOSING DATE be deemed to have ceded, assigned, transferred and

made over unto and in favour of NEWCO all its right, title and interest in

and to the ERGO ASSETS.

10.2 The PARTIES reciprocally warrant in favour of each other that they will sign all

documents necessary for and/or incidental to the aforegoing upon written request

therefor and will do all things necessary to achieve their contemplated objectives.

11. Employees

11.1 As an integral part of its proposed closure of the ERGO OPERATIONS, it is

recorded that AGA had already retrenched all employees who were employed by

AGA in respect thereof and that it is accordingly not incumbent upon NEWCO to

take over any such employees.

11.2

AGA hereby indemnifies and holds NEWCO harmless in respect of all claims,

damage, loss and/or expense which may be made against and/or suffered by

NEWCO in connection with and/or arising out of the employment by AGA of any

persons at the ERGO OPERATIONS prior to the CLOSING DATE.

12. Non-Publication

12.1 The PARTIES record that it is not their intention to advertise the sale of the ERGO

ASSETS in terms of Section 34 of the Insolvency Act, No 24 of 1936, as amended.

12.2 By reason of the aforegoing, AGA does hereby indemnify, hold harmless and

absolve NEWCO in respect of all claims of whatsoever nature arising in relation to

the non-publication of the sale in accordance with the aforesaid Act.

13. CLOSING DATE

On the CLOSING DATE the PARTIES and/or their duly authorised representatives shall

meet at a pre-determined time and venue and at which:-

13.1

AGA shall, subject to the overriding provisions of the AGREEMENT, be deemed to

have delivered to NEWCO:-

13.1.1

all of the tangible and intangible assets of the ERGO OPERATIONS, the

former in good order and condition, fair wear and tear excepted where

applicable; and

13.1.2 physical possession and de facto control of the ERGO OPERATIONS;

13.2 the PARTIES shall procure that the ATTORNEYS:-

13.2.1 release the SURETYSHIP; and

13.2.2

all accumulated instalments plus interest thereon as provided in clause

8.2.2 supra,

to AGA for its own benefit and account.

14. Ownership of ERGO ASSETS

Notwithstanding anything to the contrary in the AGREEMENT contained, upon payment

by NEWCO to AGA of the purchase consideration of ZAR42 800 000,00 (forty two million

eight hundred thousand RAND), ownership of the ERGO ASSETS (subject only to the

conversion of the ERGO MINING RIGHTS from OLD ORDER MINING RIGHTS to NEW

ORDER MINING RIGHTS and the subsequent sale, transfer, cession and assignment

thereof into the name of NEWCO), shall pass from AGA to NEWCO and be deemed to be

vested in NEWCO in all respects.

15. Good Faith and Implementation

15.1 The PARTIES undertake to do all such things, perform all such acts and take all

steps to procure the doing of all such things and the performance of all such acts,

as may be necessary or incidental to give or conducive to the giving of effect to the

terms, conditions and import of the AGREEMENT.

15.2 The shall at all times during the continuance of the AGREEMENT

observe the principles of good faith towards one another in the performance of their

obligations in terms of the AGREEMENT. This implies, without limiting the

generality of the aforegoing, that:-

15.2.1

they will at all times during the term of the AGREEMENT act reasonably,

honestly and in good faith;

15.2.2 they will perform their obligations arising from the AGREEMENT

diligently and with reasonable care; and

15.2.3

they will make full disclosure to each other of any matter that may affect

the execution of the AGREEMENT or its implementation from time to

time.

16. Breach

16.1 Should any of the PARTIES commit a breach of any of the provisions of the

AGREEMENT which are applicable to it, either prior or subsequent to the

CLOSING DATE, then and in such event the aggrieved PARTY/IES shall be

obliged to afford the guilty PARTY/IES a period of 30 (thirty) days' written notice [or

within such longer period not to exceed a further 30 (thirty) days should it not be

possible for the breach to be remedied within the first period], calculated from the

date of receipt thereof, within which to remedy the breach, failing which the

aggrieved PARTY/IES shall then be entitled at its/their sole and absolute discretion

and subject to the overriding provisions of clause 16.2 infra, to cancel the

AGREEMENT and claim damages, alternatively to abide thereby and claim

damages without prejudice to any other rights then vested in the aggrieved

PARTY/IES in law.

16.2

Notwithstanding anything to the contrary in 16.1 supra:-

16.2.1 the aggrieved PARTY/IES shall only be entitled to cancel the

AGREEMENT if the breach is a material breach of a material provision

which strikes at the roots of the AGREEMENT and cannot otherwise be

reasonably remedied by monetary compensation, save that after

payment of the purchase consideration in clause 8.2.2 supra, AGA shall

not be entitled to cancel the AGREEMENT and shall be restricted to a

claim for specific performance;

16.2.2 in the AGREEMENT where a PARTY alleges that it is an aggrieved

PARTY/IES and/or that it has a claim and/or has suffered a loss then the

onus of proving any breach and/or claim and/or loss will rest on the

PARTY/IES making the allegation;

16.2.3

should any dispute arise with regard to any proposed or purported

cancellation of the AGREEMENT, then the provisions of clause 17 infra

shall be and become operative.

17. Adjudication of Disputes

17.1 Save as otherwise provided in the AGREEMENT, should any dispute arise

between the PARTIES in regard to:-

17.1.1

the interpretation of;

17.1.2

the effect of;

17.1.3 the PARTIES' respective rights or obligations under;

17.1.4

a breach of;

17.1.5 the termination of;

17.1.6

any matter arising out of the termination of,

the AGREEMENT, that dispute shall be decided by arbitration in the manner set

out in this clause 17.

17.2 The arbitrator shall be appointed by the PARTIES, and failing agreement, shall be

nominated by the Arbitration Foundation of South Africa ("AFSA"). Should AFSA

not be in existence at the time, the nomination shall be by the Chairman for the

time being of the Johannesburg Bar Council.

17.3 The arbitration shall be held at Xxxxxxxxxxxx, Xxxxxxx, XXX and 'in camera' on

the basis that such proceedings will be strictly private and confidential.

17.4

The arbitration shall be held in accordance with the Rules of AFSA, or if AFSA shall

not be in existence, in accordance with the formalities and procedures settled by

the arbitrator, which shall be in an informal and summary manner, that is, it shall

not be necessary to observe or carry out either the usual formalities or procedure

or the strict rules of evidence, and otherwise subject as aforesaid of the Arbitration

Act, 1965, of the RSA and any statutory modification or re-enactment thereof.

17.5

The arbitrator shall be entitled to:-

17.5.1

investigate or cause to be investigated any manner, fact or thing which

he considers necessary or desirable in connection with any matter

referred to him for decision;

17.5.2

decide the matters submitted to him according to what he considers just

and equitable in all the circumstances, having regard to the purpose of

the AGREEMENT; and

17.5.3

make such award, including an award for specific performance, an

interdict, damages or a penalty or the costs of arbitration or otherwise,

as he in his discretion may deem fit and appropriate.

17.6 The arbitration shall be held as quickly as possible after it is demanded with a view

to it being completed within 30 (thirty) days after it has been so demanded.

17.7 This clause is severable from the rest of the AGREEMENT and shall therefore

remain in effect even if the AGREEMENT is terminated.

17.8 Subject to the above provisions of this clause 17, the law governing the

AGREEMENT shall be the law of the RSA and the Court having jurisdiction to

enforce any award made under this clause shall be the Witwatersrand Local

Division of the High Court of South Africa and all appeal courts therefrom.

18. No Commission

The PARTIES acknowledge that no agent was instrumental in the conclusion of the

AGREEMENT and in the circumstances there is no commission payable to any third party

in connection therewith.

19. Legal and Ancillary Costs

Each PARTY shall be liable for its own costs of and in connection with the drafting and

drawing of the AGREEMENT and all matters ancillary thereto, save that the fees due and

payable to the COMPETITION COMMISSION in respect of the notification to such

regulatory authority, shall be borne and paid by NEWCO.

20. Domicilia

20.1 The PARTIES hereby choose domicilia citandi et executandi for all purposes under

the AGREEMENT at the addresses set opposite their respective names

hereunder:-

20.1.1

AGA – 00 Xxxxx Xxxxxx, Xxxxxxx, Xxxxxxxxxxxx, 0000 RSA - telefax

number 011 637-6323;

20.1.2

NEWCO - 0

Xxxxx, Xxxxx Xxxx, Xxxx Xxxxxxx Office Park, 337

Brooklyn Road, Brooklyn, Pretoria 0002, RSA - telefax number

012 346-4409.

20.2 Any notice to any of the PARTIES shall be addressed to it at its domicilium

aforesaid and either sent by telefax or delivered by hand. In the case of any notice

20.2.1

sent by telefax, it shall be deemed to have been received, unless the

contrary is proved, on the next business day after despatch; and

20.2.2

delivered by hand, it shall be deemed to have been received, unless the

contrary is proved on the date of delivery, provided such date is a

business day or otherwise on the next following business day.

20.3 Any PARTY shall be entitled, by notice to the other, to change its domicilium to

another address in the RSA, provided that the change shall only become effective

14 (fourteen) days after service of the notice in question.

20.4 Actual receipt of written notice shall constitute good and valid delivery of a notice

notwithstanding that such notice is given other than in terms of 20.2.1 or 20.2.2

supra.

21. Confidentiality/Announcements

21.1 The PARTIES agree and undertake not to make any public disclosures or

announcements regarding the conclusion or content of the AGREEMENT save with

the prior written consent of all the PARTIES.

21.2 The PARTIES acknowledge that the subject matter of this AGREEMENT shall be

and remain highly confidential at all material times and shall not be capable of

being disseminated in any form other than to bona fide professional advisors.

22. Non-Variation

22.1 No variation or amendment of the AGREEMENT will be of any force or effect

unless reduced to writing and signed by all the PARTIES.

22.2

No consensual termination of the AGREEMENT will be of any force or effect unless

reduced to writing and signed by all the PARTIES.

22.3 No waiver or abandonment of any PARTY's rights arising from the AGREEMENT,

accrued or otherwise, will be of any force or effect as against such PARTY unless

such waiver or abandonment is reduced to writing and signed by the PARTY

waiving and abandoning such rights.

22.4 No oral statements and no conduct by a PARTY relating to any purported variation,

amendment, cancellation, waiver or abandonment will estop a PARTY from relying

upon the formalities prescribed in the preceding sub-clauses of this clause.

23. Governing Laws

Irrespective of where any of the PARTIES may be domiciled or where the AGREEMENT

may be signed, it shall in all respects be governed, interpreted and implemented in

accordance with the laws of the RSA.

24. Signature in Counterparts

The AGREEMENT may be signed in separate counterparts, each of which shall be

deemed to be an original and all of which taken together shall constitute one and the

same instrument. A counterpart of the AGREEMENT in telefax form shall be conclusive

evidence of the original signature and shall be as effective in law as the counterparts in

original form showing the original signatures.

25. Whole Agreement

The AGREEMENT constitutes the whole agreement between the PARTIES with regard to

the subject matter hereof and no representations or warranties, by commission or

omission which are not recorded herein, shall be of any force or effect.

Thus done and signed by AGA at Johannesburg on this the 6

day of August 2007, in the

presence of the undersigned witnesses.

As witnesses:-

For: AngloGold Xxxxxxx Limited

/s/ XX Xxxxxx

- duly authorised signatory -

Thus done and signed by NEWCO at Johannesburg on this the 6

day of August 2007, in the

presence of the undersigned witnesses.

As witnesses:-

For: Friedshelf 849 (Proprietary) Limited

/s/ DAW van der Xxxx

- director -

Thus done and signed by DRD SA at Johannesburg on this the 6

day of August 2007, in the

presence of the undersigned witnesses.

As witnesses:-

For: DRDGold South African Operations
(Proprietary) Limited

/s/ D Pretorius

- director -

Thus done and signed by MINTAILS SA at Johannesburg on this the 6

day of August 2007, in

the presence of the undersigned witnesses.

As witnesses:-

For: MinTails South Africa (Proprietary)
Limited

/s/ DAW van der Xxxx

- director -

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Memorandum of Agreement

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