The participation by Brimstone in a BEE consortium to invest in Grindrod Limited and withdrawal of cautionary Brimstone Investment Corporation Limited (Incorporated in the Republic of South Africa) Registration number 1995/010442/06 Share Code: BRT ISIN: ZAE000015277 Share Code: BRN ISIN: ZAE000015285 ("Brimstone") FURTHER ANNOUNCEMENT REGARDING THE PARTICIPATION BY BRIMSTONE IN A BLACK ECONOMIC EMPOWERMENT (“BEE”) CONSORTIUM TO INVEST IN GRINDROD LIMITED (“GRINDROD”) AND WITHDRAWAL OF CAUTIONARY ANNOUNCEMENT 1. Introduction Shareholders are referred to the announcement released on SENS on 8 April 2014 (“Terms Announcement”) advising that Brimstone had entered into a binding memorandum of understanding with Grindrod, Calulo Investments Proprietary Limited, Calulo Newco Proprietary Limited and Solethu Investments Proprietary Limited relating to the establishment of a consortium special purpose vehicle (the “Consortium SPV”) for the purpose of concluding an aggregate R1.6 billion equity investment in Grindrod (the “BEE Transaction”), resulting in the Consortium SPV having a shareholding in Grindrod of 8.4%. The Consortium SPV will, subject to the fulfilment or waiver of the conditions precedent set out in the Terms Announcement, subscribe for 64 million Grindrod ordinary shares at a price of R25.00 per share. In terms of the BEE Transaction, Brimstone shall pay a cash consideration of R450 million for a 59.2% shareholding in the Consortium SPV, which shares will be held by Brimstone or such other subsidiary of Brimstone as Brimstone may nominate. Further to the Terms Announcement, the unaudited pro forma financial effects of the BEE Transaction (“Financial Effects”) have now been determined and are disclosed below. 2. Financial Effects Based on Brimstone’s published audited consolidated results for the financial year ended 31 December 2013, the Financial Effects of the BEE Transaction on Brimstone’s basic and diluted earnings per share (“EPS”), basic and diluted headline earnings per share (“HEPS”), net asset value per share (“NAV”) and tangible net asset value per share (“TNAV”) are set out below. The Financial Effects are prepared for illustrative purposes only and, because of its nature, may not give a fair presentation of Brimstone’s financial position, changes in equity and results of operations or cash flows. The Financial Effects are the responsibility of the board of directors of Brimstone. Before the BEE After the BEE Percentage (1) Transaction Transaction change (cents) (cents) (%) (2)(3) EPS – basic 189.9 202.7 6.8 (2)(3) EPS – diluted 162.2 173.1 6.8 (2)(3) HEPS – basic 188.4 201.3 6.8 (2)(3) HEPS – diluted 160.9 171.9 6.8 (4)(5) NAV 1 324.0 1 324.0 - (4)(5) TNAV 1 263.6 1 263.6 - Shares in issue (000) 244 531 244 531 - Notes: 1. The “Before the BEE Transaction” financial information has been extracted, without adjustment, from Brimstone’s published audited consolidated results for the financial year ended 31 December 2013. 2 2. EPS and HEPS as reflected in the “After the BEE Transaction” column are based on the assumption that the BEE Transaction was implemented on 1 January 2013 for statement of comprehensive income purposes. 3. EPS and HEPS were adjusted for the after tax effects of: - costs of funding the BEE Transaction, being R450 million at 90% of prime bank overdraft rate; - Brimstone’s equity accounted share of the profits of the Consortium SPV after taking into account the following in the books of the Consortium SPV: Cost of funding the BEE Transaction, being: R450 million at 79.5% of prime bank overdraft rate; and R400 million at 80% of prime bank overdraft rate, - receipt of dividends from the investment in Grindrod. The dividends were assumed to be the same as those declared and paid by Grindrod during 2013; - fair value gains on the investment based on the difference between the purchase price and transaction costs capitalised and the closing price of Grindrod ordinary shares on 31 December 2013 at R28.03. It has been assumed that the investment will be accounted for at fair value approximating market prices for the purposes of the Financial Effects; and - interest income on dividends received at bank deposit rates. 4. NAV and TNAV as reflected in the “After the BEE Transaction” column are based on the assumption that the BEE Transaction was implemented on 31 December 2013 for statement of financial position purposes. 5. There were no adjustments that affected the NAV and TNAV figures. 3. Withdrawal of cautionary announcement Brimstone shareholders are advised that they no longer need to exercise caution when dealing in their Brimstone shares as the Financial Effects of the BEE Transaction have now been disclosed. 18 June 2014 Cape Town Investment Bank and Sponsor Nedbank Capital Legal Advisers ENS Date: 18/06/2014 02:00:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE'). The JSE does not, whether expressly, tacitly or implicitly, represent, warrant or in any way guarantee the truth, accuracy or completeness of the information published on SENS. The JSE, their officers, employees and agents accept no liability for (or in respect of) any direct, indirect, incidental or consequential loss or damage of any kind or nature, howsoever arising, from the use of SENS or the use of, or reliance on, information disseminated through SENS.