TRANSACTION CAPITAL LIMITED - Amendment to Joint Venture Agreement

Amendment to Joint Venture Agreement

Transaction Capital Limited                        TransCapital Investments Limited
(Incorporated in the Republic of South Africa)     (Incorporated in the Republic of South Africa)
Registration number: 2002/031730/06                (Registration No. 2016/130129/06)
JSE share code: TCP                                 Bond Company code: TCII
ISIN: ZAE000167391
(“Transaction Capital” or the “Company”)

AMENDMENT TO JOINT VENTURE AGREEMENT

INTRODUCTION

Shareholders are referred to the circular dated 6 August 2019 (“the Circular”) regarding the joint venture
agreement dated 29 July 2019 between Transaction Capital Risk Services International Proprietary Limited
(2016/403162/07) (“TCRSI”), a wholly owned subsidiary of Transaction Capital, and Genki Group Limited
(registration number 1983821, incorporated in the BVI) (“Genki Group”) owned by the respective foreign
trusts of Jonathan Jawno, Michael Mendelowitz and Roberto Rossi (“the Founders”) (“the Joint Venture”)
to invest abroad in credit orientated alternative assets, including value driven credit related investments
through TC Global Finance Limited (“TCGF”) (“the Agreement”). The Circular also required shareholder
approval regarding the further allocation of EUR 80 million (in addition to the initial allocation amount of
EUR 20 million allocated to the Joint Venture and as announced on SENS on 19 December 2018).

Shareholders are referred to the Circular, available on the Company’s website, for full details. Terms and
definitions in the Circular shall have the same meaning in this announcement unless otherwise defined.

On 5 September 2019, shareholders (excluding the Founders respective entities) approved the additional
allocation amount for investment in the Joint Venture (wherein TCRSI and Genki participate equally), as a
category 2 transaction in terms of paragraph 9(5)(a) of the JSE Listings Requirements (“the JSE LR’s”) and
a related party transaction in terms of paragraph 10 of the JSE LR, together with the terms and conditions
of the Agreement.


AMENDMENT TO DEFINTION OF “TARGET ASSETS”

Shareholders are hereby advised that the Agreement between TCRSI and the Genki Group was amended
in writing on 12 May 2021, in respect of the definition of “Target Assets”.

The definition of Target Assets, including the amendment will read as follows:

“…means credit-orientated alternative assets. ‘Assets’ include but are not limited to bilateral and multi-
lateral loans, corporate and consumer related distressed debt, non-performing loans, insolvency claims,
and other Special Situation Opportunities, as well as equity, partnerships, securitisation or other interests
in any of the foregoing or in any business with a principal focus on any of the foregoing or in any business
outside the Republic of South Africa whose assets and/or activities fall within the scope of, or are ancillary
to, the assets and/or activities of Transaction Capital and its subsidiaries or other entities (which fall within
the ambit of the expertise, knowledge and infrastructure of the Genki Group and its associates), the
financial results of which are or are required to be consolidated in Transaction Capital’s annual financial
statements in accordance with Transaction Capital’s accounting policies from time to time.“

RATIONALE FOR THE AMENDMENT - NEW BUSINESS OPPORTUNITIES

The Transaction Capital Group actively identifies and invests in alternative asset classes, in which our best-
in-class technology, proprietary data and analytics capabilities enable us to generate outstanding
returns. This extends to operating unique, high-potential businesses in market sectors where historically
low levels of stakeholder trust provide compelling opportunities for disruption. We partner with expert,
entrepreneurial and co-invested management teams to scale, grow and position these highly specialised,
digitally advantaged and vertically integrated businesses to offer market-leading value propositions. The
Transaction Capital strategy has continued to evolve in line with business opportunities and market
dynamics and has broadened since the date of the Circular beyond the narrow focus of credit-orientated
alternative assets. An example of this evolution was the investment of a 49.9% stake in WeBuyCars in
September 2020.

TCGF aims to identify transformational deals that may launch the Transaction Capital Group on an
international stage, especially in circumstances where investing in international assets may not
necessarily be seamlessly managed and/or integrated into any of the Transaction Capital Group’s existing
businesses. This investment approach differs from many other South African companies. Having the
founders based offshore via an established London office and an associated infrastructure and IP base is
an essential component not only of quality deal origination but also of ongoing risk management of the
investment assets. In addition, the Founders’ close proximity to an international investment, together
with their direct financial exposure, should result in a lower risk, better outcome for Transaction Capital
and its shareholders.

Shareholders should note the following, amongst other factors:
1. The maximum investment amount of EUR 100 million by TCRSI has not changed;
2. The Agreement contains formal processes and protections for both Joint Venture parties;
3. The Company (through TCRS and ultimately through the Joint Venture) is able to proactively pursue
   opportunities in Target Assets presented;
4. The allocated amount has been and will be invested cautiously over time in Target Assets which meet
   the Joint Venture mandate;
5. The Company will continue to report back to shareholders on progress made as regards investments
   by the Joint Venture at interim and year-end results presentations; and
6. Save for the amendment referred to above, all the terms and conditions of the Agreement will
   continue to be of full force and effect.

As the amendment is not considered material or in conflict with the Agreement, and further has no impact
on the financial effects previously reported. The JSE has no objection with the amendment proceeding
without the necessity for a circular.

Hyde Park
28 May 2021
Enquiries: Sharon Nayger - Company Secretary
Telephone: +27 (0) 82 904 0654

JSE Equity Sponsor: INVESTEC BANK LIMITED
JSE Debt Sponsor: RAND MERCHANT BANK (A division of FirstRand Bank Limited)

Date: 28-05-2021 04:00:00
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