Zeder Investments : Unbundling of Kaap Agri Shareholding and Further Cautionary Announcement

ZEDER INVESTMENTS LIMITED (Incorporated in the Republic of South Africa) (Registration number: 2006/019240/06) Share code: ZED

ISIN: ZAE000088431

LEI: 37890022AF5FD117D649 ("the Company" or "Zeder")

UNBUNDLING OF KAAP AGRI SHAREHOLDING AND FURTHER CAUTIONARY ANNOUNCEMENT

Unless defined in the body of this Announcement, capitalised terms shall have the meanings ascribed to them in the definitions section at the end of this Announcement.

1. ZEDER UNBUNDLING

1. Shareholders are hereby advised that the Board has resolved to unbundle the Company's shareholding of 31 286 956 Kaap Agri Shares, comprising approximately 42.2% of the total issued share capital of Kaap Agri, to Shareholders by way of a pro rata distribution in specie, in the ratio of 1 Kaap Agri share for every 49.22692 Zeder Shares held on the Zeder Unbundling Record Date ("Distribution Ratio"), subject to the fulfilment of the Zeder Unbundling Condition.
2. The Zeder Unbundling, if implemented, will constitute a pro rata distribution in specie in terms of section 46 of the Companies Act and section 46 of the Income Tax Act, with Shareholders thereafter having a direct interest in Kaap Agri rather than an indirect interest via Zeder.
3. As Kaap Agri is listed on the JSE and will remain listed on the JSE on the implementation of the Zeder Unbundling, the Zeder Unbundling will not require the approval of Shareholders in terms of paragraph 5.85 of the JSE Listings Requirements.

2. RATIONALE FOR THE ZEDER UNBUNDLING

1. The Board believes that the Zeder Unbundling will be in the best interest of Shareholders in order to maximise shareholder wealth.
2. The Zeder Unbundling is aimed to theoretically maximise wealth for Shareholders for the reasons set out below -

1. The Zeder Unbundling will result in Shareholders holding the Kaap Agri Distribution Shares directly, which will eliminate the current discount applied to the Kaap Agri Distribution Shares currently included in the sum of the parts ("SOTP") value of the Company.
2. On a per Zeder Share basis, the Kaap Agri Distribution Shares had an attributable value of R1.02 on Friday, 25 February 2022 (based on Kaap Agri's volume- weighted average price ("VWAP") over the 30 trading days preceding that date) and accordingly comprised 21.8% of the SOTP value per Zeder Share on the same date. Kaap Agri's success resulted in it constituting a large part of the Zeder

portfolio in recent times. Post the Zeder Unbundling, Zeder will remain well capitalised and will be in a healthy liquidity position.

2.2.3. Zeder has been a shareholder in Kaap Agri since 2006 and was instrumental in the listing of Kaap Agri on the JSE during 2017. The Board has tremendous gratitude towards all the people at Kaap Agri for the success story it has been fortunate to be part of. A special word of thanks goes to Sean Walsh (CEO), Graeme Sim (CFO) and the rest of the Kaap Agri board of directors. Kaap Agri has a strong management team and board of directors, and remains well capitalised. Zeder is proud to have been associated with Kaap Agri.

3. FURTHER INFORMATION REGARDING THE ZEDER UNBUNDLING

3.1. Zeder Unbundling Condition

1. The Zeder Unbundling is subject to the fulfilment of the condition precedent that by no later than Friday, 22 April 2022 the Financial Surveillance Department of the South African Reserve Bank approves the Zeder Unbundling on terms and conditions acceptable to Zeder.
2. Zeder may, at any time, extend the date for fulfilment of the Zeder Unbundling Condition.

3.2. Implementation of the Zeder Unbundling

1. Under the Zeder Unbundling, Shareholders will receive the Kaap Agri Distribution Shares in Dematerialised form only.
2. Accordingly, all Certificated Shareholders wishing to receive their Kaap Agri Distribution Shares in Dematerialised form must appoint a CSDP under the terms of the Financial Markets Act, directly or through a Broker, to receive the Kaap Agri Distribution Shares on their behalf.
3. Should a Certificated Shareholder not appoint a CSDP under the terms of the Financial Markets Act, directly or through a Broker, to receive the Kaap Agri Distribution Shares on its behalf, such Shareholder will be issued with a statement of allocation, reflecting its Kaap Agri Distribution Shares, by the Transfer Secretaries. Such Shareholders can thereafter instruct the Transfer Secretaries to transfer their Kaap Agri Distribution Shares, represented by the statement of allocation, to their appointed CSDP or can instruct the Transfer Secretaries to issue them with a share certificate at any time following the Zeder Unbundling.
4. If a Shareholder is in any doubt as to what action to take in respect of the Zeder Unbundling, such Shareholder should consult its Broker, CSDP, banker, attorney or other professional advisor.

3.3. Fractional Entitlements

3.3.1. Where a Shareholder's entitlement to the Kaap Agri Distribution Shares in terms of the Zeder Unbundling, calculated in accordance with the Distribution Ratio, gives rise to a fraction of a Kaap Agri Distribution Share, such fraction will be rounded down to the nearest whole number, resulting in allocations of whole Kaap Agri Distribution Shares and a cash payment in respect of the fraction to such Shareholder. The fractional entitlements will be delivered in aggregate to each

CSDP and they will be responsible for the payment of the cash fractional payment to Shareholders, which will be funded from the disposal of the fractional entitlements to which they are entitled on the market.

1. In accordance with the JSE Listings Requirements, the weighted average traded price for a Kaap Agri Distribution Share on the last day to trade, currently anticipated to be Tuesday, 5 April 2022, plus one business day less 10% will be used to calculate the cash value of the respective fractions of Kaap Agri Distribution Shares to be paid to the applicable Shareholders. The cash value in respect of the fractions of Kaap Agri Distributions Shares will be announced on SENS on the day immediately preceding the Zeder Unbundling Record Date, which is currently anticipated to occur on Thursday, 7 April 2022.
2. Certificated Shareholders whose bank account details are not held by the Transfer Secretaries, are requested to provide such details to the Transfer Secretaries to enable payment of the cash amount due for the aforementioned fraction of a Kaap Agri Distribution Share. Should no details be on record, the funds will be held by the Company in trust until such time as the details have been provided and the cash fraction will thereafter be paid to the Shareholder upon its request without interest, subject to the applicable laws of prescription.

3.4. Tax considerations in relation to the Zeder Unbundling

1. Shareholders should consult their own tax advisors regarding any tax consequences of the Zeder Unbundling.
2. It is expected that the distribution of the Kaap Agri Shares in terms of the Zeder Unbundling should qualify as an "unbundling transaction" for purposes of section 46(1) of the Income Tax Act and should accordingly qualify for rollover relief for tax purposes in South Africa for Zeder and its Shareholders, save to the extent that the relevant Shareholder falls within one or more of the categories described in paragraph 3.4.8 below, in which case section 46 of the Income Tax Act will not be applicable to such Shareholder and the distribution in those cases will be deemed to be a dividend in specie. The tax consequences for Foreign Shareholders should be confirmed by such Foreign Shareholders with advisors in those jurisdictions.
3. Consequently, the receipt of the Kaap Agri Distribution Shares by Shareholders resident in South Africa should qualify for tax relief and should not constitute a "return of capital" or a "dividend".
4. Any Shareholder holding Zeder Shares as trading stock or on capital account, as the case may be, will be deemed to acquire the Kaap Agri Distribution Shares as trading stock or as capital assets on the same basis. The Shareholders must allocate a portion of the expenditure or base cost in respect of the Zeder Shares to the Kaap Agri Distribution Shares and reduce the expenditure or base cost in respect of the Zeder Shares with reference to market values of these shares. The Shareholders will be deemed to have incurred the expenditure or base cost allocated to the Kaap Agri Distribution Shares on the same date that it was incurred in respect of the Zeder Shares.
5. The expenditure or base cost, as the case may be, to be allocated to the Kaap Agri Distribution Shares will be determined by applying the ratio that the market value of Kaap Agri Distribution Shares, as at the last day to trade Zeder Shares in

order to be recorded in the Register to participate in the Zeder Unbundling, plus one Business Day, currently anticipated to be Wednesday, 6 April 2022, bears to the sum of the market value, at the end of that day, of the Kaap Agri Distribution Shares and the Zeder Shares.

1. Zeder will advise Shareholders of the specified ratio at which expenditure must be allocated by way of an announcement expected to be published on SENS on Thursday, 7 April 2022. The allocated expenditure must be used in the determination of any profits or losses or capital gains or losses, as the case may be, derived on any future disposals of the Zeder Shares or Kaap Agri Distribution Shares.
2. The distribution of the Kaap Agri Distribution Shares to ordinary Shareholders will be exempt from the payment of any STT.
3. The provisions of section 46 of the Income Tax Act will not apply to the unbundling of the Kaap Agri Distribution Shares to a Shareholder who is not a resident or a person that is exempt from tax in South Africa, for instance pension funds and the Government of South Africa, and which holds at least 5% of the ordinary shares in Zeder immediately before the Zeder Unbundling.
4. In terms of sections 46(5) and 46(5A) of the Income Tax Act, the distribution of the Kaap Agri Distribution Shares must be disregarded for dividends tax purposes and must also not be treated as a return of capital for the purposes of paragraph 76B of the Eighth Schedule to the Income Tax Act.
5. Shareholders who are non-resident for tax purposes in South Africa are advised to consult their own professional tax advisors regarding the tax treatment of the Zeder Unbundling in their respective jurisdictions, having regard to the tax laws in their jurisdiction and any applicable tax treaties between South Africa and their country of residence.

3.5. Foreign Shareholders

1. No action has been taken by Zeder to obtain any approval, authorisation or exemption to permit the distribution of the Kaap Agri Distribution Shares or the possession or distribution of this Announcement (or any other publicity material relating to the Kaap Agri Distribution Shares) in any jurisdictions other than South Africa.
2. The Zeder Unbundling is being conducted under the procedural requirements and disclosure standards of South Africa which may be different from those applicable in other jurisdictions. The legal implications of the Zeder Unbundling on persons resident or located in jurisdictions outside of South Africa may be affected by the laws of the relevant jurisdiction. Such persons should consult their professional advisors and inform themselves about any applicable legal requirements, which they are obligated to observe. It is the responsibility of any such persons wishing to participate in the Zeder Unbundling to satisfy themselves as to the full observance of the laws of the relevant jurisdiction in connection therewith.
3. Foreign Shareholders should refer to and take into account the disclaimers set out at the end of this Announcement in relation to those jurisdictions.

3.6. Exchange Control

1. Zeder will apply for the requisite exchange control approval from the Financial Surveillance Department of the South African Reserve Bank for the Zeder Unbundling.
2. Shareholders who are not resident in, or whose registered addresses are outside the Common Monetary Area, will need to comply with the Exchange Control Regulations with further details to be included in the finalisation announcement.
3. If Shareholders are in any doubt as to what action to take, they should consult their professional advisors.

3.7. Further information

1. There are 1 543 260 354 Zeder Shares in issue at the date of this Announcement. The Company's income tax number is 9406891151.
2. The Zeder Unbundling will occur from income reserves.

4. SALIENT DATES AND TIMES

4.1. The salient dates for the Zeder Unbundling are as follows: