GOLD BRANDS INVESTMENTS LIMITED - Disposal of the Black Steer Franchise Business and Renewal of Cautionary

Disposal of the Black Steer Franchise Business and Renewal of Cautionary

GOLD BRANDS INVESTMENTS LIMITED
Incorporated in the Republic of South Africa
(Registration number 2015/168426/06)
Share code: GBI     ISIN: ZAE000212791
(“Gold Brands” or “the Company”)


DISPOSAL OF THE BLACK STEER FRANCHISE BUSINESS AND RENEWAL OF CAUTIONARY


1. INTRODUCTION

   The board of directors of Gold Brands (“the Board”) wishes to advise shareholders that Gold Brands has
   entered into a binding term sheet (“Term Sheet”) with Laudian Franchise Management One Proprietary
   Limited (“Laudian”), in terms of which Gold Brands, through its wholly-owned subsidiary Black Steer
   Enterprises Proprietary Limited (“BSE”), will dispose of the Black Steer Franchise Business (“Black
   Steer”) (“the Disposal”).

2. THE DISPOSAL

  2.1   Nature of the business of Black Steer

        Black Steer, “The Original” Steak House, is a household name famous for their steaks, burgers and
        legendary ribs. The re-engineering of the brand image in 2006 ensures that the “Living Legend” lives
        on.

  2.2   Rationale for the Disposal

        The Board has decided to dispose of the Blacksteer Franchise Business in order to increase
        cash flow into the Company and settle debt.

  2.3   Purchasers

        Gold Brands has entered into the Term Sheet with Laudian, the ultimate shareholders of which are:

        - Christopher Leonard van Zyl; and
        - Danie van Zyl.

  2.4   Purchase consideration and application of sale proceeds

        The purchase consideration payable by Laudian in respect of the Disposal is an amount of
        R3.2 million in cash and will be settled as follows:

        2.4.1. an initial amount of R750 000 on the date of signature of the Term Sheet;

        2.4.2. R1 250 000 on the date of signature of the agreements contemplated in paragraph 2.5 below;
               and

        2.4.3. R300 000 per month for the following four months after the payment contemplated in
               paragraph 2.4.2 above.

        The sale proceeds will be used to increase cash flow into the Company.

  2.5   Conditions precedent

        The Disposal is subject to the fulfilment of, inter alia, the following suspensive conditions:

       2.5.1 the execution of a comprehensive Sale of Business Agreement by BSE and Laudian (“the
             Parties”) and their duly authorised representatives, which agreement must be signed by no
             later than 17h00 on 18 July 2018;

       2.5.2 the conclusion of such written agreements as may be necessary for the cession, making over
             and transferring of all contracts that form part of the business assets of Black Steer to Laudian,
             which agreements must be signed by no later than 17h00 on 18 July 2018;

       2.5.3 the conclusion of such agreements as may be necessary for the transfer of all intellectual
             property rights owned by BSE in respect of Black Steer to Laudian and the conclusion of the
             required documents and agreements to give effect thereto, which agreement must be signed
             by no later than 17h00 on 18 July 2018;

       2.5.4 obtaining the requisite board and shareholder approvals for the proposed transactions from all
             of the Parties, which must be obtained by no later than 17h00 on 18 July 2018;
       2.5.5 proper publication of the sale of Black Steer as a going concern in accordance with the
             provisions of Section 34 of the Insolvency Act 24 of 1936; and

       2.5.6 that all statutory and regulatory approvals are obtained to lawfully implement the Disposal.

3. FINANCIAL INFORMATION

   The value of the net assets that are the subject of the Disposal as at 28 February 2018 was R3 343 338.
   The profit after tax attributable to the net assets that are subject to the Disposal for the year ended
   28 February 2018 was R787 150.

4. CLASSIFICATION OF THE DISPOSAL

   The Disposal is classified as a Category 2 transaction in terms of the Listings Requirements of JSE Limited.

5. RENEWAL OF CAUTIONARY ANNOUNCEMENT

   Notwithstanding the terms included in this announcement and further to the cautionary announcement
   released on 29 June 2018, shareholders are advised that the formal process to evaluate the disposal of a
   subsidiary of Gold Brands is ongoing, which if successfully concluded may have a material effect on the
   price of the Company’s securities.

   Accordingly, shareholders are advised to continue exercising caution when dealing in the Company’s
   securities until a further announcement is made.


Johannesburg
11 July 2018

Designated Adviser
Merchantec Capital

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