C O M M I S S I O N O F I N Q U IR Y I N TO S TAT E C A P T U R E H E L D AT PA R K TO W N , J O H A N N E S B U R G 10 3 0 M AY 2 0 1 9 D AY 1 0 2 20 30 MAY 2019 – DAY 102 P R O C E E D I N G S O N 3 0 M AY 2 0 1 9 C H A I R P E R S O N : G o o d m o r n i n g M s S e l l o , g o o d m o r n i n g e v e r y b o d y. A D V M A H L A P E S E L L O : M o r n in g C h a ir. C H A I R P E R S O N : I s e e t h a t t h e r e h a s n o t b e e n a n y i m p r o v e m e n t? A D V M A H LA P E S E L L O : A c t u a l ly C h a i r i t is s u r p r i s i n g t h e r e h a s n o t b e c a u s e i f t h e C h a ir h a s r e g a r d t o th e s p i n e o f th e fi le . CHAIRPERSON: Hm. A D V M A H L A P E S E L L O : T h e c o r r e c ti o n h a s b e e n m a d e . CHAIRPERSON: Hm. 10 ADV MAHLAPE SELLO: H o w w e d i d n o t fi n d i ts e l f t o t h e c o v e r a s a m a t t e r w e w e r e d i s c u s s in g th is m o r n in g b u t I h a v e b e e n a s s u r e d CHAIRPERSON: Ja. ADV MAHLAPE SELLO: T h a t t h e y a l l w i ll b e r e p r in t e d a n d r e f il e d a t le a s t th e r e … CHAIRPERSON: Ja. ADV MAHLAPE SELLO: CHAIRPERSON: T h e r e is p r o g r e s s t h e s p in e i s c o r r e c t . J a w e ll I g u e s s w e m u s t a c k n o w le d g e t h e p r o g r e s s that has happened. A D V M A H L A P E S E L L O : T h a n k y o u C h a ir. 20 CHAIRPERSON: Even if it does not meet the expectations that we had. A D V M A H L A P E S E L L O : U n d o u b t e d l y C h a i r. CHAIRPERSON: Ja. A D V M A H L A P E S E L L O : W e s h a l l e n d e a v o u r to i m p r o v e . C H A I R P E R S O N : Ye s . A D V M A H L A P E S E L L O : A n d t h is i s n o w C h a ir m a r k e d 8 8 – B B 8 [ c ] . B o Page 2 of 116 30 MAY 2019 – DAY 102 – [ a ] , [ b ] a n d [c ] w il l a ll b e . . C H A I R P E R S O N : M s S e ll o s ta r t e d b y s a y i n g 8 8 . A D V M A H L A P E S E L L O : I k n o w C h a ir. I a m lo o k i n g a t 8 a n d i t a ff e c ts w h a t I s a y. CHAIRPERSON: Ja. ADV MAHLAPE SELLO: T h e y w ill a ll b e c o r r e c t e d t h i s a f t e r n o o n s o t h e n e x t t i m e th e C h a ir h a s r e g a r d t o t h e s e fi le s t h e y w i ll b e … C H A I R P E R S O N : N o t h a t is fi n e . A D V M A H L A P E S E L L O : T h a n k y o u C h a ir. 10 C H A I R P E R S O N : T h a t is f in e . H m . A D V M A H L A P E S E L L O : C h a ir w e a r e s ti ll o n M N S R e p o r t s . CHAIRPERSON: Ja. A D V M A H L A P E S E L L O : A n d w e a r e n o w d e a li n g w it h th e M N S R e p o r t t h a t i s t i tl e d t h e R e l o c a ti o n o f 2 O E M ’s t o D u r b a n . C H A I R P E R S O N : Ye s . ADV MAHLAPE SELLO: C h a ir w i ll r e c a l l M r S e d u m e d i d e a l t w i t h 9 5 1 0 0 1 0 6 4 a n d a p p o i n t m e n t o f TA’s . C H A I R P E R S O N : Ye s . A D V M A H LA P E S E L L O : 20 To d a y w e d e a l w i t h t h e r e lo c a t io n a n d t o m o r r o w D o c t o r Bl o o m w i ll d e a l w i t h tr a n s a c ti o n s f lo w in g fr o m th e a d v ic e o f t h e TA’s . CHAIRPERSON: Ja. A D V M A H LA P E S E L L O : W h ic h w i ll b e to m o r r o w a n d t h a t w i ll c o m p l e t e t h e M N S r e p o r ts . C H A I R P E R S O N : O k a y. Page 3 of 116 30 MAY 2019 – DAY 102 A D V M A H L A P E S E L L O : T h a n k y o u C h a ir. CHAIRPERSON: Thank you. ADV MAHLAPE SELLO: T h e w i tn e s s w e w i ll – w e h a v e t o d a y is M r Thobani Mnyandu. CHAIRPERSON: Hm. A D V M A H LA P E S E L L O : A n d w i th y o u r p e r mis s i o n m a y h e b e s w o r n i n C h a ir ? C H A I R P E R S O N : O k a y p l e a s e a d m i n is te r t h e o a t h o r a ff ir m a t io n ? R E G I S T R A R : P le a s e s t a te y o u r fu ll n a m e s f o r th e r e c o r d ? 10 M R T H O B A N I T R E V O R M N YA N D U : T h o b a n i Tr e v o r M n y a n d u . REGISTRAR: D o y o u h a v e a n y o b je c ti o n s t o t a k in g t h e p r e s c r i b e d oath? M R T H O B A N I T R E V O R M N YA N D U : N o I d o n o t . REGISTRAR: D o y o u c o n s i d e r t h e o a th t o b e b i n d in g o n y o u r conscience? M R T H O B A N I T R E V O R M N YA N D U : Ye s . R E G I S T R A R : D o y o u s o l e m n ly s w e a r th a t a l l t h e e v i d e n c e y o u w i ll g iv e w i ll b e t h e t r u t h , t h e w h o l e t r u t h a n d n o th i n g b u t t h e tr u t h , i f s o p l e a s e r a i s e y o u r r ig h t h a n d a n d s a y, s o h e l p m e G o d . 20 M R T H O B A N I T R E V O R M N YA N D U : S o h e l p m e G o d . REGISTRAR: Thank you ADV MAHLAPE SELLO: Thank you. C h a ir b e fo r e M r M n y a n d u d e a ls w i t h h is p r e s e n ta t io n p e r h a p s t o p l a c e h is t e s ti m o n y i n i ts p r o p e r c o n te x t . Th e C h a ir w i ll r e c a l l t h a t l a s t w e e k Mr G o n s a lv e s r e p r e s e n ti n g t h e m i n o r i ty s h a r e h o l d e r i n th e C N R C o n s o r ti u m t e s ti f ie d a n d h e s p o k e Page 4 of 116 30 MAY 2019 – DAY 102 in la r g e p a r t o n t h e r e l o c a ti o n . Th e e v id e n c e o f Mr G o n s a lv e s c o n c e r n s r e l o c a ti o n fr o m the p e r s p e c ti v e s h a r e h o l d e r w i th in th e b id d e r. of the bidders or the m i n o r i ty Mr M n y a n d u to d a y is d e a l i n g w i t h t h e s a m e is s u e e x c e p t fr o m a d i ff e r e n t a n g l e . H e is d e a l in g w it h i t fr o m t h e Tr a n s n e t p e r s p e c t iv e a n d w h e t h e r Tr a n s n e t w a s a w a r e i n p a r t o f t h e in c r e a s e s in r e lo c a t io n s c o s t s t h a t w e r e b e i n g p r o p o s e d . W h a t p o s i ti o n it t o o k in r e g a r d t o th o s e in c r e a s e s a n d w h e t h e r i t w a s a g r e e a b l e t o s u c h i n c r e a s e s . S o a t t i m e t h e te s ti m o n y mi g h t s o u n d fa m i li a r b u t w e w o u ld l ik e to p o i n t o u t th a t t h is f r o m t h e Tr a n s n e t p e r s p e c t iv e . T h a n k 10 y o u C h a ir. W i th t h a t c o n t e x t th e n M r M n y a n d u y o u c o n f ir m t h a t y o u h a v e p r e p a r e d a p r e s e n t a ti o n o n t h e r e lo c a ti o n o f th e O E M ’s to D u r b a n . Yo u s h o u ld h a v e n e x t to y o u a f il e m a r k e d B B 8 [ c ]. M R T H O B A N I T R E V O R M N YA N D U : Ye s I c o n fir m C h a ir. A D V M A H L A P E S E L L O : A n d y o u c o n f ir m t h a t t h a t is t h e p r e s e n t a t i o n you have prepared? M R T H O B A N I T R E V O R M N YA N D U : I n d e e d i t is s o . A D V M A H L A P E S E L L O : T h e s tr u c tu r e o f t h e f il e C h a ir is t h e f ir s t p a r t o f t h e f il e i s t h e a c t u a l p r e s e n t a ti o n . T h e r e a r e t a b s 1 t o 7 t h a t f o ll o w d o c u m e n ts u n d e r t a b s 1 to 7 t h a t fo ll o w t h e p r e s e n t a ti o n . M r M n y a n d u 20 p l e a s e e x p la in w h a t t h o s e d o c u m e n t s a r e i n t a b s 1 t o 7 ? M R T H O B A N I T R E V O R M N YA N D U : T h e s e a r e d o c u m e n ts t h a t a r e n o t n e c e s s a r i ly a n n e x e d t o o u r r e p o r t . C H A I R P E R S O N : W e ll y o u s a i d h e is t e s t i fy in g fr o m t h e p e r s p e c tiv e o f Tr a n s n e t . D o y o u … A D V M A H L A P E S E L L O : N o , n o h e is g iv i n g a r e p o r t o n h o w Tr a n s n e t Page 5 of 116 30 MAY 2019 – DAY 102 d e a lt w i t h th e r e l o c a ti o n is s u e . C H A I R P E R S O N : Ye s b u t l e t m e k n o w f ir s t a b o u t h i m – a b o u t h i m . W h o is h e ? A D V M A H L A P E S E L L O : O h . Ye s I w a s g o in g to d o t h a t C h a ir I w a s … C H A I R P E R S O N : B e f o r e w e g o in t o a n y t h i n g . A D V M A H L A P E S E L L O : W e g o i n to t h e d o c u m e n ts . CHAIRPERSON: I must know who he – who he is. ADV MAHLAPE SELLO: T h e n M r M n y a n d u c o u l d y o u v e r y b r i e f ly t e ll t h e C h a ir w h o y o u a r e , w h a t r o l e y o u p l a y e d i n t h i s i n v e s t ig a ti o n a n d 10 y o u r r e l a ti o n s h i p w i th M N S ? M R T H O B A N I TR E V O R M N YA N D U : C h a ir a s a lr e a d y h a s b e e n s t a te d in f o r th e r e c o r d my n a m e i s T h o b a n i Tr e v o r M n y a n d u . I a m a n a t to r n e y a n d o n e o f t h e d ir e c t o r s a t M N S A t t o r n e y s . I a m t h e l e a d a t t o r n e y in t h e D e p a r t m e n t o f C o n s tr u c ti o n a n d E n g i n e e r i n g L a w. W e o ff e r a w i d e r a n g e o f s e r v i c e s i n t h a t a r e a o f l a w w h ic h in c l u d e s w h a t is r e f e r r e d t o a s fr o n t e n d s e r v ic e s . F r o m a l a r g e p e r s p e c tiv e w e a d v is e o r g a n s o f s t a te a s t o w h a t s h o u ld g o i n to te n d e r d o c u m e n t s , w h a t t h e y s h o u l d lo o k li k e s o w e a d v is e o n t h e le g a l fr a m e w o r k th a t is c o n c e r n e d w i th the preparation of such documents. 20 We also play a huge role in a d v is i n g o r g a n s o f s t a te a n d c o n tr a c t o r s a lik e o n c o n tr a c t m a n a g e m e n t 1 but more s p e c i fic a lly i n r e l a ti o n to disputes th a t a r i s e from c o n s tr u c ti o n e n g i n e e r in g c o n tr a c t s in c l u d in g b u t n o t li m i t e d to b a n k g u a r a n te e s , a d v a n c e d p a y m e n t b o n d g u a r a n te e s a n d t h e lik e . CHAIRPERSON: Thank you. A D V M A H L A P E S E L L O : T h a n k y o u . A n d y o u w e r e d ir e c t ly in v o lv e d i n Page 6 of 116 30 MAY 2019 – DAY 102 t h e i n v e s ti g a t i o n o f t h is p a r t ic u l a r a s p e c t t h e r e lo c a t io n o f t h e 2 O E M ’s ? M R T H O B A N I T R E V O R M N YA N D U : Ye s I c o n f ir m I w a s d ir e c tl y in v o lv e d I l e d t h e te a m t h a t p u t t o g e t h e r t h e r e p o r t . A D V M A H L A P E S E L L O : O k a y. CHAIRPERSON: Thank you. A D V M A H L A P E S E L L O : T h a n k y o u C h a ir. Yo u w e r e s ti ll e x p l a in in g t o the C h a ir the s tr u c t u r e of your s u b m is s i o n made up of your p r e s e n t a ti o n a n d f o l l o w e d b y 7 d o c u m e n ts a s fi le d u n d e r ta b s 1 t o 7 . 10 M R T H O B A N I T R E V O R M N YA N D U : C h a ir i n c o n s u l t a ti o n w i t h th e e v i d e n c e l e a d e r s w e p u t t o g e t h e r a p r e s e n t a ti o n t h a t s u m m a r is e s t h e c o n te x t a n d t h e c o n c l u s io n s o f t h e r e p o r t . Th e e x h i b it s t h a t a r e m a r k e d T T M 1 to T T M 7 a r e d o c u m e n t s t h a t a r e n o t n e c e s s a r il y a t ta c h e d t o t h e r e p o r t b u t n o n e w m a t t e r a r is e s fr o m t h e m s o i t d o e s n o t s e e k t o r a is e n e w p o i n ts b u t t h e y e x p a n d o n th e p o i n ts t h a t a r e c o n t a in e d i n th e reports. A D V M A H L A P E S E L L O : S o t h e n t h e is s u e s e m a n a t in g fr o m T T M 1 t o 7 are foreshadowed in the report? M R T H O B A N I T R E V O R M N YA N D U : I n d e e d t h e y a r e C h a ir. 20 ADV MAHLAPE SELLO: E x c e p t t h e r e p o r t d o e s n o t a t ta c h t h e d o c u m e n t a s a n e x h i b i t in r e s p e c t o f e a c h o f t h e p o i n ts ? M R T H O B A N I T R E V O R M N YA N D U : I n d e e d i t is s o . ADV MAHLAPE SELLO: O k a y. W i t h t h a t e x p la n a ti o n th e n I t h i n k w e h a v e t h e p r o p e r c o n t e x t . C o u l d y o u le a d u s th r o u g h y o u r p r e s e n t a ti o n ? M R T H O B A N I T R E V O R M N YA N D U : T h a n k y o u C h a ir. C h a ir ju s t t o g iv e Page 7 of 116 30 MAY 2019 – DAY 102 y o u ’r e a n o v e r v i e w o f w h a t t h e p r e s e n t a ti o n d e a ls w i t h w e h a v e g o t t h e c o n te n ts p a g e a t s l id e n u m b e r 2 . Th e c o n te n ts p a g e o u tl in e s t h a t w e w i ll g iv e y o u t h e b a c k g r o u n d i n r e la t io n t o t h e is s u e o f r e l o c a ti o n . M o s t i m p o r t a n tly w e w il l a s k f ir s t t h e q u e s t io n o f w h a t is r e lo c a t io n a n d w h e t h e r t h e r e w a s a c o m m e r c ia l r a t i o n a l e t o i t? W e w il l t h e n d e a l w i t h c o m m u n ic a ti o n s t h a t w e r e s e n t t o t h e O E M ’s i n r e l a ti o n to t h e i s s u e o f r e l o c a ti o n . A s w e l l a s h ig h li g h t t o y o u a t t h e o u ts e t a s to w h a t w a s t h e a tt i tu d e o f e a c h O E M i n r e s p e c t t h e r e o f . W e w i ll th e n d e a l fr o m t h e o n e p e r s p e c t iv e o f t h e O E M f ir s t w i t h t h e a p p r o v a l p r o c e s s . 10 What c o m m u n ic a ti o n s w e r e h a d to t a k e th e i s s u e o f r e l o c a ti o n c o s ts a s i t were forward? I n p a r ti c u l a r w e w i ll d e a l w i t h a p a r ti c u la r m e m o r a n d a p r e p a r e d i n t e r n a lly a t Tr a n s n e t . W e w i ll d e a l w i t h in t e r n a l m e e ti n g s a s w e ll a s e m a il c o m m u n ic a ti o n s a s I h a v e s a i d . T h e m e e ti n g s t h a t w e r e h e l d w it h th e r e s p e c tiv e O E M ’s . W e w i ll th e n h ig h l i g h t to y o u C h a ir t h a t p r io r t o th e a p p r o v a l o f t h e r e l o c a ti o n c o s ts w h a t c r i ti c a l c o m m u n ic a ti o n s w e r e h a d a m o n g s t th e n e g o ti a ti o n t e a m m e m b e r s w i t h i n Tr a n s n e t . W e w i ll d e a l w i t h – C h a ir w i th t h e in v o lv e m e n t o f a s tr u c t u r e k n o w n a s t h e Tr a n s n e t I n t e r n a l A u d i t w h o o u g h t t o h a v e p l a y e d a p a r tic u la r r o le i n t h e fa c il i ta t io n o f t h e n e g o t ia t io n s a s w e l l a s 20 t h e c o n c l u s io n o f t h e a p p r o v a l o f th e r e l o c a ti o n c o s ts . C h a ir w e w i ll t h e n t a k e y o u th r o u g h t h e s a l e a n d f in d in g s o f a n i n d e p e n d e n t e x p e r t t h a t w a s c o n t r a c t e d b y u s p u r s u a n t t o a p r i m a f a c ie v ie w t h a t w e h e l d o n t h e r e lo c a t io n c o s ts . T h a t is a r a i l l o g i s t ic s c o m p a n y th a t d o e s w o r k in t h e s p a c e . F i n a ll y C h a ir w e w i ll c o n c l u d e b y g iv in g y o u o u r f i n d in g s . A ls o e x p l a i n i n g w h a t o u r f in d i n g s m e a n f o r Tr a n s n e t c o n s id e r e d Page 8 of 116 30 MAY 2019 – DAY 102 t o g e th e r w it h t h e f i n d in g s o f t h e i n d e p e n d e n t e x p e r t w h o b y a n d la r g e a s w e f o u n d s u p p o r t t h e p r i m a fa c i e v i e w t h a t w e h a d . T h e la s t b i t w e w i ll d e a l w it h C h a ir r e l a te s t o th e r e c o m m e n d a ti o n s m a d e t o Tr a n s n e t . A D V M A H L A P E S E L L O : T h a n k y o u . Yo u m a y t h e n s t a r t . M R T H O B A N I T R E V O R M N YA N D U : T h a n k y o u C h a ir. C h a ir j u s t t o o u t li n e t h e b a c k g r o u n d a g a in . A D V M A H LA P E S E L L O : E x c u s e m e Mr M n y a n d u I a p o l o g is e . I g e t a m e s s a g e h e r e t h a t y o u a r e n o t p a r tic u la r l y a u d i b le c o u l d y o u p u ll t h e m ic r o p h o n e c l o s e r t o y o u . 10 M R T H O B A N I T R E V O R M N YA N D U : I a p o l o g is e C h a ir. A D V M A H L A P E S E L L O : Ye s . O k a y t h a n k y o u . M R T H O B A N I T R E V O R M N YA N D U : R i g h t . Fir s t ly C h a ir j u s t t o o u t li n e t h e b a c k g r o u n d t h a t l e d t o M n c e d is i N d l o v u & S e d u m e d i A t t o r n e y s b e i n g r e q u e s te d t o u n d e r ta k e a n i n v e s t ig a ti o n o n t h is is s u e . It arose o u t o f th e f a c t th a t d u r i n g J u ly 2 0 1 5 Tr a n s n e t a p p r o v e d t h e r e l o c a t i o n c o s ts f o r b o t h B T B o m b a r d ie r Tr a n s p o r ta t io n a n d C h in a N o r t h R a il a t a m o u n ts o f R 6 1 8 4 5 7 1 2 5 . 0 0 a n d R 6 4 7 1 8 1 4 9 4 . 0 0 r e s p e c t iv e ly. The is s u e o f r e l o c a ti o n C h a ir h a s b e e n t h e s u b je c t o f i n t e n s e d e b a t e r i d d l e d w i t h a l le g a ti o n s o f c o r r u p t io n t h a t w a s s a i d t o b e a s s o c i a te d w i t h it . 20 W h e n w e u n d e r t o o k t h e i n v e s t ig a ti o n s w e t h e r e f o r e s e t a c o u p l e o f q u e s t io n s t h a t a p p l ie d to th e i n v e s ti g a ti o n . A n d th is s l i d e w e s e e k t o s u m m a r i s e w h a t t h o s e q u e s t io n s w e r e . F ir s tl y C h a i r w e n e e d e d t o k n o w w h a t w a s r e l o c a t i o n i n i ts e l f ? W h a t is t h e m e a n i n g o f r e l o c a ti n g ? W e t h e n n e e d e d t o q u e s ti o n w h e t h e r th e r e w a s i n d e e d r e l o c a ti o n i n t h is in s t a n c e . W h e th e r i t w a s e n v is a g e d i n th e b u s in e s s c a s e b e c a u s e t h e Page 9 of 116 30 MAY 2019 – DAY 102 b u s i n e s s c a s e b y a n d l a r g e C h a ir a s e v i d e n c e h a s b e e n le d n o w w a s t h e d o c u m e n t t h a t g a v e e ff e c t to th e li n e i t e ms th a t w o u l d m a k e u p th e t o t a l b u d g e t f o r t h e 1 0 6 4 lo c o m o t iv e s p r o c u r e m e n t p r o c e s s . We then n e e d e d t o i n t e r r o g a t e w h e n e x a c tly a n d b y w h o m t h e d e c is i o n t o r e l o c a t e t h e t w o O E M ’s w a s ta k e n a n d w h e t h e r o r n o t t h e r e w a s a n y c o m m e r c ia l r a t io n a l e p r o v i d e d f o r th e r e l o c a ti o n o f t h e t w o O E M ’s . L a s tly w e n e e d e d t o a s k o u r s e l v e s a n d i n v e s ti g a te a n d c o m e to a c o n c l u s i o n o n w h e th e r o r n o t t h e a p p r o v e d r e l o c a ti o n c o s ts th a t w e h a v e j u s t r e f e r r e d w e r e in d e e d ju s ti fi a b l e . C h a ir in c o n s i d e r i n g th e f ir s t 10 q u e s t io n o f w h a t is r e l o c a ti o n w e d e c i d e d t o c o n s u l t t h e O x f o r d D i c t i o n a r y. Yo u w ill s e e t h e r e C h a ir a t s li d e n u m b e r 5 t h a t w e m a k e th e p o i n t t h a t th e O x f o r d D i c t i o n a r y c o n s i d e r s r e l o c a ti o n to b e t h e a c t io n o f m o v i n g t o a n e w p la c e a n d e s ta b l is h i n g o n e ’s h o m e o r b u s i n e s s th e r e . C h a ir r e l o c a t i o n th e r e f o r e p r o c e e d s fr o m th e p r e m is e th a t t h e r e is a m o v e fr o m o n e p l a c e t o a n o th e r. F o l l o w i n g o n fr o m t h is C h a ir y o u w i ll t h e n g e t c o n te x t a s t o w h y b o th i n o u r r e p o r t a s w e ll a s in th e p r e s e n t a ti o n t h e w o r d “r e l o c a ti o n ” is in in v e r t e d c o m m a s . As e a r l y a s J u n e 2 0 1 8 w h e n w e fir s t i n t e r v ie w e d t h e p r o j e c t e n g i n e e r o f Tr a n s n e t t h a t i s h e a d in g fr o m a Tr a n s n e t p e r s p e c t iv e t h e m a n u fa c t u r i n g o f t h e 20 lo c o m o t iv e s a n d c e r ti f y h is a c c e p t a n c e f r o m ti m e to t i m e . We were in f o r m e d b y Mr Fr ik k ie H a r r i s t h a t 1 . N o O E M m o v e d fr o m o n e p l a c e t o D u r b a n a n d th a t B T m o r e c l e a r l y B T a n d C N R h a d n o t s e t u p a n y ji g s n o r h a d t h e y e s t a b li s h e d s i t e w h e n th e r e q u e s t fo r t h e m t o b e l o c a t e d in D u r b a n w a s m a d e . T h e f in d in g th a t w e m a d e t h e r e f o r e a r is in g fr o m t h is w a s t h a t t h e r e w a s n o r e l o c a t io n . J u s t t o e x p l a in w h a t ji g s a r e ? Page 10 of 116 30 MAY 2019 – DAY 102 T h o s e a r e m e t a l m a t e r i a ls th a t a r e s e t u p in a m a n u f a c t u r i n g s i t e o f lo c o m o t iv e s i n o r d e r t o b e n d t h e m a t e r ia ls t h a t a r e t h e r e f o r th e m a n u f a c t u r in g o f th e l o c o m o ti v e to a p a r ti c u l a r d e g r e e . C h a i r in s li d e n u m b e r 6 a s h a s a lr e a d y b e e n c a n v a s s e d b e f o r e y o u t h i s m o r n i n g o u r v ie w – o u r f in d in g is th a t th e w o r d r e lo c a t i o n is a m is n o m e r i n s o f a r a s i t is m e n t io n e d i n th e c o n t e x t o f t h e 1 0 6 4 l o c o m o ti v e s tr a n s a c ti o n . Put d i ff e r e n t ly a n d t o r e it e r a te t h e p o i n t w e fo u n d t h a t th e r e w a s n o r e l o c a ti o n o f e it h e r B T n o r w a s t h e r e r e l o c a t i o n o f C N R . The n o t e w o r t h y p o i n t t o b e m a d e a t t h is p o i n t C h a ir is t h a t w h i ls t t h e r e w a s 10 n o t a r e l o c a ti o n p e r s e o f a n y O E M t h e r e w a s a d e c is i o n c o m m u n i c a t e d t o t h e O E M ’s fo r t h e m t o b e lo c a t e d a t a p la c e d i ff e r e n t t o th e o n e t h a t t h e y h a d in i ti a l ly t h o u g h t t h e y w o u l d b e w h e n t h e y p u t in t h e ir t e n d e r s u b m is s io n s . B u t C h a ir a s y o u w il l s e e g o i n g f o r w a r d w e h a v e f o u n d t h a t a l l c o m m u n i c a t io n s w e r e h a d i n t h is r e g a r d p r i o r t o t h e c o n c l u s io n o f t h e c o n tr a c t. A s w e ta k e y o u t h r o u g h t h e p r e s e n t a ti o n w e w i ll d e a l w i t h t h e r e s p e c t iv e c o m m u n ic a ti o n s o r r a t h e r th e c o m m u n i c a t io n s w i th t h e r e s p e c ti v e O E M ’s . A D V M A H L A P E S E L L O : O k a y. M R T H O B A N I T R E V O R M N YA N D U : C h a ir th e q u e s ti o n t h a t a r o s e fr o m 20 w h a t I h a v e j u s t e x p l a i n e d w h e n t h e d e c is io n w a s ta k e n t o c h a n g e t h e lo c a ti o n o f th e t w o O E M ’s is w h e t h e r t h e r e w a s a c o m m e r c ia l r a ti o n a le li n k e d t o t h a t d e c is i o n . And Chair the issue is covered in a report c o m m i s s io n e d b y P W C w h o w e r e in s tr u c t e d b y Tr a n s n e t b e t w e e n J a n u a r y a n d Fe b r u a r y 2 0 1 4 to c o n d u c t a n a s s e s s m e n t o f w h e th e r f ir s t o f a l l Tr a n s n e t E n g in e e r in g a n d o p e r a ti n g d iv is io n o f Tr a n s n e t w a s Page 11 of 116 30 MAY 2019 – DAY 102 g o i n g t o b e a b le t o d e l iv e r o n t h e 1 0 6 4 lo c o m o t iv e p r o g r a m m e 1 a n d 2 t o a d v is e a m o n g s t o t h e r t h i n g s a s to w h e t h e r o r n o t t h e r e w e r e a v a i la b le fa c i li ti e s t o h o u s e e a c h o f t h e O E M ’s . C h a ir y o u w i ll r e c a l l t h a t i n it i a l ly w h e n t h e t e n d e r w a s i s s u e d i t w a s i s s u e d fo r t h e m a n u f a c t u r in g o f e l e c tr ic lo c o m o t iv e s a s w e l l a s d i e s e l s l o c o m o t iv e s o n the one side. t w o O E M ’s . 8927. Th e v i e w a t t h a t p o in t w a s t h a t t h e r e w e r e g o i n g t o b e T h e P W C r e p o r t C h a ir is t o b e f o u n d a t Vo l u m e 1 2 p a g e B u t w h a t w e h a v e tr i e d t o d o i n t h is s l id e i s t o s u m m a r i s e t h e fi n d i n g s o f P W C . J u s t t o g e t b a c k a g a i n t o t h e is s u e o f th e d e c is i o n t o 10 a w a r d t o f o u r d i ff e r e n t O E M ’s a s o p p o s e d t o t w o t h a t b r o u g h t a b o u t t h e q u e s t io n a s t o w h e t h e r o r n o t th e f a c il i ty th a t w a s – i s k n o w n a s K o e d o e s p o o r t in P r e t o r ia w o u l d b e a b le t o h o u s e m o r e th a n t w o O E M ’s . ADV MAHLAPE SELLO: Please proceed. M R T H O B A N I T R E V O R M N YA N D U : G o in g a h e a d C h a ir P W C m a d e t h e fi n d i n g t h a t u n fo r t u n a t e l y P W – K o e d o e s p o o r t w o u ld n o t b e a b l e to h o u s e m o r e t h a n 2 O E M ’s a s t h e y w o u l d a r is e is s u e s r e l a te d t o in t e l le c t u a l p r o p e r ty i n r e l a ti o n t o t h e e le c t r ic l o c o m o ti v e s b e i n g c o n d u c t e d – b e i n g m a n u fa c tu r e d b y t w o O E M ’s a s w e l l a s th o s e b e in g m a n u f a c t u r e d b y th e d i e s e l O E M ’s . A s a r e s u l t a n d b a s e d o n a s t u d y 20 d o n e b y P W C o f th e f a c i li t ie s o f Tr a n s n e t a r o u n d t h e c o u n tr y t h e y p u t i n a n a l te r n a tiv e s u g g e s t i o n t h a t t h e o t h e r t w o O E M ’s c o u l d e i th e r b e lo c a t e d i n U i te n h a g e i n t h e E a s t e r n C a p e w h e r e Tr a n s n e t E n g in e e r in g h a s g o t f a c il i ti e s o r D u r b a n i n a p l a c e k n o w n a s B a y h e a d . T h e d e c is io n t h a t w a s m a d e h a d p r o s a n d c o n s t o i t w a s t h a t th e l o c a ti o n w o u l d r a th e r b e D u r b a n . J u s t t o p o in t o u t a t t h is p o in t C h a ir th a t t h e d e c is io n Page 12 of 116 30 MAY 2019 – DAY 102 a n d t h e c o m m u n ic a ti o n i n t h i s r e g a r d w a s m a d e p r io r t o t h e s i g n a t u r e o f t h e c o n tr a c ts a n d d u r i n g t h e n e g o t ia t io n s w i t h th e fo u r O E M ’s . ADV MAHLAPE SELLO: A n d b y r e f e r e n c e to t h e c o n t r a c t s y o u m e a n t h e m a in c o n tr a c t ? M R T H O B A N I T R E V O R M N YA N D U : Ye s w h e n I … A D V M A H L A P E S E L L O : T h e a ll o c a ti o n – t h e a w a r d . M R T H O B A N I T R E V O R M N YA N D U : W h e n I r e f e r t o … A D V M A H L A P E S E L L O : O r t h e t e n d e r. M R T H O B A N I T R E V O R M N YA N D U : Th e c o n tr a c t s I a m r e f e r r in g t o t h e 10 m a in c o n tr a c t s b e i n g t h e lo c o m o t iv e s s u p p ly a g r e e m e n ts c o n c l u d e d w i t h t h e fo u r O E M ’s . A D V M A H L A P E S E L L O : O k a y. M R T H O B A N I T R E V O R M N YA N D U : C h a ir w e t h e n m o v e o n to t h e n e x t s li d e to s u m m a r is e w h a t w a s th e c r i ti c a l a d v i c e t h a t w a s g iv e n t o Tr a n s n e t b y P W C o n c e t h e y h a d m a d e t h e r e c o m m e n d a ti o n s . PWC a d v is e d t h a t Tr a n s n e t s h o u l d r e q u e s t t h e O E M ’s t o j u s ti fy c o s ts in c u r r e d a s a r e s u l t o f t h e r e l o c a ti o n a n d t o s e e k a l t e r n a t iv e a s s e m b ly lo c a ti o n s w h e r e a d d it i o n a l c o s ts w o u l d n o t b e i n c u r r e d . W e m a k e th e p o i n t in th is s li d e t h a t w e h a v e f o u n d t h a t t h e a d v i c e g i v e n b y P W C 20 a b o v e w a s n o t c a r r ie d th r o u g h e i t h e r i n t h e n e g o t ia t io n s n o r w a s i t c o n ta in e d in t h e p r o p o s a ls b y t h e O E M ’s f o r t h e r e l o c a ti o n c o s ts . C h a i r w e a ls o m a k e th e p o i n t i n t h is s li d e t h a t i n th e l o c o m o t iv e s u p p l y a g r e e m e n ts t h a t w e r e c o n c lu d e d w i th t h e t w o O E M ’s b e i n g B T a n d C N R t h e c o n c e p t o f r e l o c a ti o n n o r t h e c o s t p l a y s a n y r o l e n o r i s it m e n ti o n e d in t h o s e a g r e e m e n ts . Page 13 of 116 30 MAY 2019 – DAY 102 ADV MAHLAPE SELLO: So on that point as at the point of conclusion o f th e l o c o m o tiv e s u p p l y a g r e e m e n ts w e c a n d e d u c e t h a t i t w a s n o t c o n te m p l a t e d b y t h e p a r t i e s t h a t a n y o f t h e O E M ’s w o u ld h a v e t o r e l o c a t e a n d t h e r e f o r e i n c u r c o s ts a s a c o n s e q u e n c e t h e r e o f? I f o n e o n t h e s tr ic t r e a d in g o f t h e a g r e e m e n t . M R T H O B A N I T R E V O R M N YA N D U : O n t h e s tr ic t r e a d i n g o f t h e lo c o m o t iv e s u p p l y a g r e e m e n t s . A D V M A H L A P E S E L L O : Ye s . M R T H O B A N I T R E V O R M N YA N D U : Ye s it is s o . 10 A D V M A H L A P E S E L L O : N o w a f t e r th e c o n c l u s i o n o f th e a g r e e m e n ts i n M a r c h 2 0 1 4 is t h e r e d o c u m e n t s i g n e d b y b o th p a r ti e s t h a t o p e n e d th e – o p e n e d u p t h e i s s u e o f r e l o c a ti o n a n d s t a r t a n e g o ti a ti o n p r o c e s s i n r e s p e c t t h e r e o f a n d i f th e r e is s u c h a d o c u m e n t d o e s t h a t d o c u m e n t in d i c a t e o n – i n t e r m s o f w h ic h c l a u s e i n t h e c o n tr a c t s u c h a n e g o ti a ti o n is b e i n g u n d e r t a k e n . M R T H O B A N I T R E V O R M N YA N D U : A t t h is p o i n t I w o u ld l ik e to t a k e t h e C h a ir t o T T M 1 w h ic h is o n p a g e 3 8 o f t h e b u n d l e b e f o r e th e C h a ir t h is m o r n in g . A D V M A H L A P E S E L L O : Ye s . 20 M R TH O B A N I T R E V O R M N YA N D U : T h i s i s e m a i l c o r r e s p o n d e n c e s e n t t o o n e o f t h e O E M ’s a n d p r io r to t h e c o n c l u s io n o f t h e l o c o m o ti v e s u p p ly a g r e e m e n ts . I t is s e n t b y a s u p p l y c h a i n s e r v ic e s p e r s o n n e l a t Tr a n s n e t Fr e i g h t R a i l w h o p l a y e d t h e r o le o f b e in g t h e i n t e r f a c e 1 i n t h e n e g o ti a ti o n s o f t h e l o c o m o tiv e s u p p ly a g r e e m e n ts a s w e l l a s b e i n g th e in t e r fa c e a s w e w i ll s e e l a t e r i n r e la t io n t o th e n e g o t ia t io n f o r t h e Page 14 of 116 30 MAY 2019 – DAY 102 r e l o c a ti o n c o s ts . A D V M A H L A P E S E L L O : Ye s . M R T H O B A N I T R E V O R M N YA N D U : C h a ir a s e v i d e n c e h a s a l r e a d y b e e n l e d t h e l o c o m o tiv e s u p p l y a g r e e m e n t s w e r e c o n c lu d e d o n 1 7 March 2014. T h e e m a i l b e fo r e y o u C h a ir a t T T M 1 o n p a g e 3 8 is a d d r e s s e d b y M s L i n d i w e M d l e ts h e to M r A u b r e y L e k w a n e a s w e ll a s a D a v i d A n g li n w h o a r e fr o m B o m b a r d ie r Tr a n s p o r t a ti o n . I w o u l d l ik e to r e a d in t o th e r e c o r d i f t h e C h a ir w i ll a l l o w ? CHAIRPERSON: Ja. 10 M R T H O B A N I T R E V O R M N YA N D U : Th e s u b j e c t o f t h e e m a i l r e a d s a s f o ll o w s : “ R e v i s e d Pr o p o s a l . T h e d a te o f t h e e m a il is 6 M a r c h 2014. D e a r Te n d e r e r y o u a r e r e q u e s te d to s u b m i t y o u r r e v is e d p r o p o s a l w h ic h i n c lu d e th e la t e s t T E s c o p e o f w o r k b y n o l a te r t h a n 1 4 h 0 0 t o m o r r o w 7 March 2014. Price impact for Durban must be s u b m i tt e d o n M o n d a y a t 1 0 a m . T F R a ls o r e q u e s t e d t h a t y o u s h a r e y o u r s u b - c o n t r a c to r s p r ic e s a s p e r y o u r d is c u s s i o n y e s t e r d a y. K in d l y b e o n s t a n d b y fo r 20 t o m o r r o w. Ti m e w i ll be c o m m u n ic a t e d in th e m o r n in g . ” A D V M A H L A P E S E L L O : O k a y. M R T H O B A N I T R E V O R M N YA N D U : C h a ir t h is … A D V M A H L A P E S E L L O : S o t h a t is a n i n v i t a t i o n fr o m Tr a n s n e t ? M R T H O B A N I T R E V O R M N YA N D U : Ye s . Page 15 of 116 30 MAY 2019 – DAY 102 A D V M A H L A P E S E L L O : Ye s . M R T H O B A N I T R E V O R M N YA N D U : T h i s d e m o n s t r a t e s th a t th e r e w a s a n i n v i t a ti o n f r o m Tr a n s n e t i n w r i t in g t o t h e o n e O E M t o g i v e a p r i c e in d i c a t io n a n d fa c t o r in w h a t i t w o u ld c o s t th e O E M – t h e p a r ti c u la r O E M t o b e l o c a t e d a n d m a n u f a c t u r e d fr o m D u r b a n . W e h a v e n o t b e e n a b l e to d is c o v e r a d ir e c t r e s p o n s e to t h i s b u t fr o m t h e c o m m u n ic a ti o n s t h a t fo ll o w a s w e ll a s t h e lo c o m o t iv e s u p p ly a g r e e m e n ts i t w o u l d s e e m t h a t t h e p a r t ic u l a r O E M c h o s e n o t t o p u t i n a p r ic e p r o p o s a l i n s o f a r a s o u r i n v e s t ig a ti o n s a r e c o n c e r n e d a n d t h e r e f o r e t h e a g r e e m e n t w a s 10 c o n c l u d e d o n t h e b a s i s th a t t h e p a r t ic u l a r O E M w o u l d b e lo c a t e d e ls e w h e r e . C h a ir it is r e le v a n t a t t h is p o i n t t o t a k e y o u t o a p p e n d ix 2 o f o u r r e p o r t w h ic h is t o fo u n d a t Vo l u m e 1 2 p a g e s 8 8 3 0 . ADV MAHLAPE SELLO: C h a i r if – i f I m a y I o m i t te d t o p o i n t o u t M r M n y a n d u ’s t e s ti m o n y w il l r e ly o n ly o n 1 2 a n d 1 3 s o t h e C h a ir c o u l d h a v e 1 3 r e a d y – a t th e r e a d y. T h e r e s t a r e n o t a p p l ic a b l e . T h a n k y o u C h a ir. C o u ld y o u r e p e a t t h a t p a g e n u m b e r a g a i n M r M n y a n d u ? M R T H O B A N I T R E V O R M N YA N D U : I t i s 8 8 3 0 fo r t h e C h a ir. ADV MAHLAPE SELLO: Ye s . 8830 is the cover sheet the actual d o c u m e n t s t a r ts a t 3 3 1 . 20 M R T H O B A N I T R E V O R M N YA N D U : 8 8 3 1 . ADV MAHLAPE SELLO: 8831. M R T H O B A N I T R E V O R M N YA N D U : A p o l o g i e s . A D V M A H L A P E S E L L O : Ye s . M R T H O B A N I T R E V O R M N YA N D U : W h a t t h e C h a ir w i ll s e e a t p a g e 8 8 3 1 i s th a t th is is a n i n te r n a l m e m o r a n d u m a t Tr a n s n e t a d d r e s s e d t o Page 16 of 116 30 MAY 2019 – DAY 102 M r Br ia n M o le f e th e G r o u p C h i e f Ex e c u ti v e a t t h e t i m e . reads: T h e s u b je c t T h e a w a r d o f T F R – o f t h e T F R 1 0 6 4 l o c o m o t iv e s te n d e r to o r i g in a l ly e q u i p m e n t m a n u f a c t u r e r s a n d t h e ir a s s o c i a te d s u b - c o n tr a c ts w i t h Tr a n s n e t . B e l o w th a t C h a ir y o u w il l s e e i t is d a t e d 1 6 M a y 2 0 1 4 w h ic h is s o m e t w o m o n t h s a f t e r th e c o n c l u s io n o f t h e lo c o m o t iv e s u p p ly a g r e e m e n ts . A D V M A H LA P E S E L L O : S o r r y Mr M n y a n d u to b e p r e c is e i t is w i t h Tr a n s n e t E n g i n e e r i n g w h ic h a s y o u e x p l a i n e d i s a d i v i s i o n w i t h i n Tr a n s n e t? 10 M R T H O B A N I T R E V O R M N YA N D U : Ye s . A D V M A H L A P E S E L L O : T h a t is w h a t it r e a d s y e s . M R T H O B A N I T R E V O R M N YA N D U : Tr a n s n e t E n g i n e e r i n g . A D V M A H L A P E S E L L O : Ye s . M R T H O B A N I T R E V O R M N YA N D U : T h e m e m o r a n d u m is fr o m a M r R i c h a r d Va l li h u h i s t it l e a t t h e t i m e b e in g C h ie f Ex e c u ti v e o f t h e O p e r a t in g D i v is io n Tr a n s n e t E n g i n e e r i n g . ADV MAHLAPE SELLO: Hm. M R T H O B A N I T R E V O R M N YA N D U : C h a ir if y o u t u r n t o p a g e 8 8 3 2 th e p u r p o s e o f t h e m e m o r a n d u m i s s u m m a r is e d a s to r e q u e s t t h e Tr a n s n e t 20 G r o u p C h i e f E x e c u t iv e t o fo r m a l ly c o m m u n ic a te t h e a l lo c a t io n o f B o m b a r d i e r Tr a n s p o r ta t io n a n d C N R t o Tr a n s n e t E n g in e e r i n g D u r b a n f a c i li ty. A D V M A H L A P E S E L L O : Ye s . M R T H O B A N I T R E V O R M N YA N D U : C h a ir p e r h a p s w e c a n t u r n t o 8 8 3 3 s o a s n o t t o d e t a in o u r s e l v e s w i t h t h e m e m o r a n d u m a n d d e a l w i th t h e Page 17 of 116 30 MAY 2019 – DAY 102 a m b i t w e s e e k t o d r a w y o u r a t t e n t io n t o i n t h is m e m o r a n d u m . At p a r a g r a p h 5 a t 8 8 3 3 i t r e a d s a s f o l lo w s : “ T h e d e c is io n t o a ll o c a t e C S R Z h u z h o u e le c tr ic lo c o m o t iv e c o m p a n y a n d G E ju s t t o p o in t o u t C S R Zhuzhou is the CSR being the lo c o m o t iv e m a n u f a c t u r e r th a t w a s a w a r d e d 3 5 9 lo c o m o tiv e s a t – t o t h e K o e d o e s p o o r t f a c il it y w a s b a s e d o n t h e f a c t t h a t s u b - c o n tr a c ts w it h t h e s e O E M ’s a l r e a d y e x is t a n d t h a t t h e f a c il it y c u r r e n tly h o ld s p r o d u c t io n li n e s f o r l o c o m o ti v e s d e s ig n e d b y t h e m . ” 10 C h a ir y o u w i ll r e c a ll t h a t e v i d e n c e a s b e i n g l e d b y M r S e d u m e d i t h a t p r i o r t o th e c o n c lu s i o n o f t h e 1 0 6 4 l o c o m o tiv e s p r o g r a m m e t h e r e h a d b e e n a tr a n s a c ti o n f o r t h e a c q u is it i o n o f 9 5 l o c o m o ti v e s w h ic h a r e e l e c tr ic l o c o m o ti v e s t h a t w e r e m a n u f a c tu r e d a t K o e d o e s p o o r t b y C S R a n d 4 3 d i e s e l l o c o m o ti v e s t h a t w e r e b e in g m a n u f a c t u r e d b y G E . I t is i n r e s p e c t t h o s e l o c o m o ti v e s t h a t p a r a g r a p h 5 is b a s e d . ADV MAHLAPE SELLO: And sorry the 43 by GE were also m a n u f a c t u r e d i n K o e d o e s p o o r t? M R T H O B A N I T R E V O R M N YA N D U : I n d e e d . 20 A D V M A H L A P E S E L L O : Ye s . M R T H O B A N I T R E V O R M N YA N D U : C h a ir w e t h e n t a k e y o u t o p a r a g r a p h 6 w h ic h r e a d s : “ C N R r o l li n g s t o c k S o u t h A fr ic a w h ic h is t h e C N R C o n s o r t iu m o n c e i t had been in c o r p o r a te d have i n d ic a te d t h e ir a c c e p ta n c e o f th e i r a l lo c a t io n t o t h e D u r b a n f a c il i ty t h r o u g h t h e ir a c ti o n s w h i c h w e w il l Page 18 of 116 30 MAY 2019 – DAY 102 p r o m p tly y o u to C h a ir a n d p l a n n i n g a r o u n d t h e u s e o f t h e D u r b a n f a c i li ty. B o m b a r d i e r Tr a n s p o r t a ti o n h a s h o w e v e r e x p r e s s e d th e i r r e q u ir e m e n t f o r a n o ffi c i a l c o m m u n i c a t io n i n f o r m in g t h e m t h a t t h e i r f a c to r y s i t e w i ll b e D u r b a n . ” S e c t io n 1 .1 . 3 3 o f t h e s u b - c o n tr a c t t h is r e l a te s t o th e s u b - c o n t r a c t a g r e e m e n t c o n c l u d e d b e t w e e n Tr a n s n e t E n g i n e e r in g o n t h e o n e e n d a s w e ll a s B o m b a r d i e r r e a d s a s f o l l o w s : “ F a c il it i e s s h a ll m e a n t h e r o ll i n g s t o c k a s s e m b l y a n d e n g i n e e r i n g f a c i li t ie s o f th e s u b - c o n t r a c t o r s i tu a t e d i n K o e d o e s p o o r t o r a n y o th e r 10 lo c a ti o n o f t h e s u b - c o n tr a c t o r a s m a y b e a g r e e d u p o n b y t h e p a r t i e s . U n t il s u c h ti m e a s th e c o m m u n i c a t io n h a s b e e n r e c e iv e d B o m b a r d i e r Tr a n s p o r t a t i o n in s is t s t h a t t h e c o n tr a c t u a l a g r e e m e n t is K o e d o e s p o o r t. ” C h a ir i n r e l a ti o n t o w h a t h a p p e n e d p u r s u a n t t o th is c o m m u n ic a ti o n … ADV MAHLAPE SELLO: B e f o r e w e g e t t h e r e s o o u r u n d e r s t a n d in g o f S e c t io n 1 .1 . 3 3 o r C la u s e 1 .1 . 3 3 o f s u b - c o n tr a c t w e m u s t u n d e r s t a n d t h a t t h e p a r ti e s c o n tr a c t e d o n t h e b a s is t h a t t h e p r o d u c ti o n m a y b e i n K o e d o e s p o o r t o r a n y p la c e in S o u t h A f r ic a ? M R T H O B A N I T R E V O R M N YA N D U : Ye s . A D V M A H LA P E S E L L O : 20 A n d it is o n th a t b a s i s t h a t t h e y c o n tr a c t e d a n d th e y a c c e p t e d t h a t t e r m ? M R T H O B A N I T R E V O R M N YA N D U : T h a t i s c o r r e c t C h a ir. ADV MAHLAPE SELLO: Thank you. CHAIRPERSON: such ti m e as A n d w h y w a s B o m b a d ie r Tr a n s p o r t a ti o n s a y i n g u n ti l th e c o m m u n ic a t i o n has been r e c e iv e d Bombadier Tr a n s p o r t a t i o n i n s is ts th a t t h e c o n tr a c tu a l a g r e e m e n t i s K o e d o e s p o o r t . Page 19 of 116 30 MAY 2019 – DAY 102 Wa s – was there already an arrangement in terms of which K o e d o e s p o o r t h a d b e e n a g r e e d w it h th e m a s a s i t e ? M R T H O B A N I T R E V O R M N YA N D U : C h a i r in r e l a t i o n t o th e m a i n a g r e e m e n t - t h e L o c o m o t iv e s … CHAIRPERSON: Hm. M R T H O B A N I T R E V O R M N YA N D U : S u p p l y A g r e e m e n t . CHAIRPERSON: Hm. M R T H O B A N I T R E V O R M N YA N D U : T h e fa c il i ty … CHAIRPERSON: Hm. 10 M R T H O B A N I T R E V O R M N YA N D U : For e n g i n e e r in g or the m a n u f a c t u r in g o f t h e l o c o m o tiv e s is n o t e d a s K o e d o e s p o o r t . C H A I R P E R S O N : O h , o k a y. M R T H O B A N I T R E V O R M N YA N D U : Ye s C h a ir. C H A I R P E R S O N : O k a y. ADV MAHLAPE SELLO: A n d i f I m a y ju s t f o l lo w o n t h a t q u e s t i o n a t p a r a g r a p h 5 o f – o f th a t m e m o r a n d u m p a g e 8 8 3 3 it s t a t e s th a t : “ T h e d e c is io n to a ll o c a te b o t h C S R a n d G E w a s based – was the reason …” M R T H O B A N I T R E V O R M N YA N D U : Ye s . 20 ADV MAHLAPE SELLO: It advances the reasons. M R T H O B A N I T R E V O R M N YA N D U : Ye s . A D V M A H L A P E S E L L O : A t t h e ti m e t h a t d e c is i o n w a s m a d e is th e r e a r e c o r d o f a f ir m d e c is i o n to r e l o c a te o r a l l o c a te B o m b a d i e r a n d C N R t o Durban? M R T H O B A N I T R E V O R M N YA N D U : I n o u r fi n d i n g s th e r e h a d b e e n a Page 20 of 116 30 MAY 2019 – DAY 102 fir m d e c is i o n b a s e d o n t h e fi n d i n g s o f t h e P W C R e p o r t a s w e ll a s n o w w i t h p a r tic u la r r e fe r e n c e t o t h e c o r r e s p o n d e n c e t h a t w e h a v e t a k e n th e C h a ir t o a t T T M 1 . A D V M A H L A P E S E L L O : O k a y. Yo u m a y p r o c e e d . M R T H O B A N I T R E V O R M N YA N D U : T h a n k y o u C h a ir. C h a ir w e w o u ld n o w l ik e t o t a k e y o u t o v o l u m e 1 2 - t h e s a m e v o l u m e – a t p a g e 8 8 3 7 . C h a ir w e c a n m a k e i t 8 8 3 8 b e c a u s e 8 8 3 7 i s t h e c o v e r i n g p a g e . CHAIRPERSON: A D V M A H L A P E S E L L O : Ye s . 10 M R T H O B A N I T R E V O R M N YA N D U : T h i s is c o r r e s p o n d e n c e o n t h e le t t e r h e a d o f B o m b a d i e r Tr a n s p o r t a ti o n . I t is a d d r e s s e d t o Tr a n s n e t Fr e i g h t R a i l o n 6 J u n e 2 0 1 4 . CHAIRPERSON: ADV MAHLAPE SELLO: Huh-uh. M R T H O B A N I T R E V O R M N YA N D U : T h e s u b j e c t r e a d s : “ A l lo c a t io n of B o m b a d ie r Tr a n s p o r t a ti o n to the Tr a n s n e t E n g i n e e r i n g ’s D u r b a n F a c il i ty - L e t te r o f M r Br ia n M o l e f e to D r L u t z B e r tl in g dated 21 May 2014”. 20 A D V M A H L A P E S E L L O : Ye s . M R T H O B A N I T R E V O R M N YA N D U : “ D e a r M r J i y a n e , fu r t h e r t o o u r i n fo r m a l d is c u s s i o n s B o m b a d i e r h a s n o w r e c e i v e d t h e l e tt e r a b o v e m e n ti o n e d f r o m y o u r Group C h ie f E x e c u t iv e Chief O p e r a ti n g M r Br ia n M o le f e v i a o u r O ffi c e r M r L u tz B e r tl in g Page 21 of 116 on 30 MAY 2019 – DAY 102 26 May 2014. M r M o l e f e o ffi c i a l ly i n f o r m e d u s t h a t Tr a n s n e t E n g i n e e r i n g ’s D u r b a n F a c il i ty s h o u l d h o s t o u r o p e r a ti o n s a n d a s k e d B o m b a d ie r Tr a n s p o r ta t io n to agree. A r e s p o n s e le t t e r w a s p r o v id e d b y D r B e r tl i n g on 5 June 2014 c o n f ir m i n g that our p r o j e c t t e a m w o u l d c o n ta c t T F R d ir e c t ly t o c o n f ir m t h e n e x t s te p . ” C h a ir what we seek to do with t h is correspondence fr o m th e p e r s p e c t iv e o f t h e O E M b e in g B o m b a d ie r is t h a t c o m m u n ic a t i o n t h e n 10 w a s h a d a n d t h e r e w a s c o n fir m a t i o n t h a t i t w a s a c c e p te d t h a t i t w o u l d b e l o c a te d a t D u r b a n . T h a t i s w h a t w e s e e k t h e C h a ir t o n o t e fr o m t h i s . I n r e l a ti o n t o t i m e l i n e C h a ir a n d i n s o fa r a s o u r s l id e n u m b e r 9 is c o n c e r n e d . W e w o u l d n o w li k e t o t a k e y o u t h r o u g h th e a t t i tu d e o f C N R C o n s o r t iu m … A D V M A H L A P E S E L L O : A n d b e f o r e w e d o s o ju s t w it h r e f e r e n c e t o t h e a p p e n d ic e s y o u j u s t r e f e r r e d u s t o . M R T H O B A N I T R E V O R M N YA N D U : Ye s . A D V M A H L A P E S E L L O : W h a t is y o u r in t e r p r e ta t io n o f th e a g r e e m e n ts t h a t is s i g n e d b y B o m b a d i e r a n d C N R ? 20 W o u ld i t - if o n e w e r e t o c o n c l u d e th a t it w a s n o t o p e n t o a n y o f t h e O E M s t o in s is t o n o p e r a ti n g fr o m K o e d o e s p o o r t w o u l d t h a t b e a – a p r o p e r in t e r p r e ta t io n o f th a t a g r e e m e n t? M R T H O B A N I T R E V O R M N YA N D U : Ye s in t e r p r e t a ti o n o f th e a g r e e m e n t . A D V M A H L A P E S E L L O : O k a y, t h a n k y o u . Page 22 of 116 that w o u ld be a proper 30 MAY 2019 – DAY 102 M R T H O B A N I T R E V O R M N YA N D U : C h a ir a t s l id e n u m b e r 9 w e w o u l d n o w l ik e to t a k e y o u t h r o u g h t h e a t ti t u d e o f C N R C o n s o r ti u m in s o f a r a s i t c o n c e r n s th e d e c is io n w e s h o u ld s a y t o lo c a t e o r r a th e r b e l o c a te d in t h e D u r b a n F a c il i ty o f Tr a n s n e t E n g i n e e r i n g . T T M 2 w h i c h is t o b e f o u n d a t p a g e 3 9 b e fo r e th e b u n d l e t h a t is w i th C h a ir th is m o r n i n g is a le t t e r fr o m t h e C N R C o n s o r t iu m . T h e le t te r is d a te d 1 0 M a r c h . We m a k e t h e p o i n t a t t h i s p o i n t C h a ir t h a t th a t is e x a c t ly a w e e k p r i o r t o t h e c o n c lu s i o n o f th e L o c o m o t iv e S u p p l y A g r e e m e n t . ADV MAHLAPE SELLO: Huh-uh. 10 M R T H O B A N I T R E V O R M N YA N D U : I t is a d d r e s s e d t o – s o r r y C h a ir – i t is a d d r e s s e d t o M s L in d i w e M d l e ts h e w h o a t th e ti m e w a s a C o m m o d i ty M a n a g e r i n th e S u p p l y C h a i n S e r v i c e s U n i t o f Tr a n s n e t Fr e ig h t R a il . W e h a v e a l r e a d y e x p l a i n e d t h e p a r t ic u l a r r o l e t h a t s h e w a s p la y i n g i n r e l a ti o n to t h e n e g o t ia t io n s . I n fa c t w e h a v e a lr e a d y d e m o n s tr a t e d i t t h r o u g h th e c o r r e s p o n d e n c e t h a t s h e h a d s e n t t o B o m b a d i e r o n 9 M a r c h 2 0 1 4 . I t s a y s C h a ir : “ D e a r L i n d i w e , w it h r e f e r e n c e t o t h e T F R r e q u e s t r e l a ti n g to t h e C N R r e s p o n s e t o f o r t h e c o s t i m p a c t o f b u il d in g t h e lo c o m o t iv e s i n D u r b a n w e w o u ld l ik e 20 t o p o i n t o u t t h a t o u r o r i g i n a l q u o t a ti o n i s b a s e d u p o n b u il d i n g th e l o c o m o t iv e s i n K o e d o e s p o o r t o r G e r m is t o n . W e u n d e r s t a n d fr o m T E … ” W h i c h is m e a n t t o d e n o t e Tr a n s n e t E n g in e e r i n g . “ … t h a t th e K o e d o e s p o o r t F a c i li ty h a s a lr e a d y b e e n a l lo c a t e d b u t C N R w o u l d l ik e t o r e q u e s t t h a t b e f o r e Page 23 of 116 30 MAY 2019 – DAY 102 a f i n a l d e c is io n i s m a d e r e g a r d i n g t h i s m a tt e r t h a t w e a r e g r a n t e d s i t e v i s i ts fo r b o t h D u r b a n a n d G e r m is t o n . As regards the request for the cost i m p a c t o f t h is d e c i s i o n C N R w o u l d lik e t o p o i n t o u t that our preliminary studies show that the cost of b u il d in g t h e l o c o m o ti v e s i n D u r b a n w il l b e h i g h e r than th e cost of b u i ld i n g the lo c o m o tiv e s in G e r m is t o n . ” A D V M A H L A P E S E L L O : Ye s . 10 M R T H O B A N I T R E V O R M N YA N D U : C h a ir if y o u tu r n o v e r l e a f i t is t h e n fr o m C N R d a t e d 11 M a r c h “ T h e I m p a c t o f M a n u f a c t u r i n g in D u r b a n v e r s u s J o h a n n e s b u r g . ” W h a t w e h a v e tr i e d to d o i n s li d e n u m b e r 9 a n d t h e tw o s l id e s th a t f o l l o w i s t o s u m m a r i s e a n d b e a b le to ta k e y o u t h r o u g h th e p a r tic u la r q u o ta t io n – a s w e s e e i t – r e c e i v e d b y Tr a n s n e t fr o m C N R . A D V M A H L A P E S E L L O : Ye s . M R T H O B A N I T R E V O R M N YA N D U : T h e C h a ir w i ll n o t e t h a t o n t h e e x tr e m e l e f t t h o s e a r e t o p ic s w h ic h r e la t e t o m a n u f a c tu r i n g . C h a ir w e a r e t o u n d e r s t a n d th is a s t h e c a p i t a l – i t is t o d e n o t e t h e c a p i t a l 20 e x p e n d i t u r e t h a t w o u l d b e i n c u r r e d if C N R w e r e t o b e l o c a t e d i n D u r b a n . W e w i ll m a k e s o m e e x a m p le s f o r y o u C h a ir i n r e l a ti o n t o w h a t w o u ld c o s t le s s a n d w h a t w o u l d b e a s a v i n g a s a r e s u l t o f C N R b e i n g lo c a t e d i n D u r b a n . T h e f ir s t i te m is a n e n g i n e p e r l o c o m o t iv e . I n t h e t h ir d c o l u m n i t r e a d s t h a t t h e r e w o u l d b e a n e x tr a c o s t o f R 8 0 0 0 . T h e r e i s a c o m m e n t t h a t is p u t in t h e r e i n o r d e r t o s u b s t a n t ia t e - a s w e Page 24 of 116 30 MAY 2019 – DAY 102 s e e i t – w h y th e r e w o u l d b e t h e e x tr a c o s t . T h e c o m m e n t r e a d s : “Engine imported but te s t i n g done in Johannesburg.” T h a t i s t o b e u n d e r s t o o d C h a i r s a y i n g w h il s t t h e e n g in e s w o u l d b e i m p o r t e d fo r e a c h lo c o m o t iv e fr o m C h i n a o r a n y w h e r e e l s e t h a t t h e y w i ll b e p r o c u r in g fr o m a n d g e t t o t h e D u r b a n H a r b o u r th e r e w o u l d b e a n e x tr a c o s t fo r t h e e n g i n e s to b e t e s t e d . W e t h e n s e e k t o – o n th e o th e r h a n d – d r a w y o u r a tt e n ti o n t o w h a t w a s g o i n g t o b e a s a v i n g … A D V M A H L A P E S E L L O : B e f o r e w e g e t t h a t – w e g e t t o t h a t p o in t . 10 M R T H O B A N I T R E V O R M N YA N D U : Ye s C h a ir. ADV MAHLAPE SELLO: I f – i f I u n d e r s t a n d y o u c o r r e c tl y. T h e e x tr a c o s t – t h e e n g i n e is i m p o r t e d ? M R T H O B A N I T R E V O R M N YA N D U : Ye s . A D V M A H L A P E S E L L O : F u l ly a s s e m b le d f r o m C h i n a ? M R T H O B A N I T R E V O R M N YA N D U : Ye s C h a ir. ADV MAHLAPE SELLO: It arrives at Durban Harbour? M R T H O B A N I T R E V O R M N YA N D U : Ye s C h a ir. ADV MAHLAPE SELLO: A n d i f m a n u fa c t u r i n g o f t h e lo c o m o t iv e s is u n d e r t a k e n a t K o e d o e s p o o r t t h a t e n g i n e w o u l d t h e n h a v e to b e 20 tr a n s p o r t e d t o J o h a n n e s b u r g ? M R T H O B A N I T R E V O R M N YA N D U : T h a t i s c o r r e c t C h a ir. ADV MAHLAPE SELLO: A n d i t is a t J o h a n n e s b u r g t h a t i t w il l b e t e s te d ? M R T H O B A N I T R E V O R M N YA N D U : T h a t i s c o r r e c t C h a ir. ADV MAHLAPE SELLO: S o t h a t c o s t w a s g o i n g t o b e i n c u r r e d i n th e Page 25 of 116 30 MAY 2019 – DAY 102 fir s t p la c e ? W h y is i t l is t e d h e r e a s a n e x tr a c o s t? D o e s th a t – is t h a t in t e n d e d t o c o v e r t h e c o s t o f r e t u r n i n g t h e e n g i n e b a c k to D u r b a n f o r m a n u f a c t u r e o f t h e lo c o m o t iv e ? M R T H O B A N I T R E V O R M N YA N D U : C h a ir u n f o r tu n a te ly th e q u o ta t io n it s e l f is n o t s u b s t a n t ia t e d … A D V M A H L A P E S E L L O : O k a y. M R T H O B A N I T R E V O R M N YA N D U : B u t w e c a n f o l l o w t h a t th e e x tr a c o s t t o b e i n c u r r e d is t o t a k e it b a c k to t h e D u r b a n B a y h e a d S i t e fo r i t t o b e f i t te d o n t h e lo c o m o t iv e . 10 A D V M A H L A P E S E L L O : O t h e r w is e t h e c o s t o f tr a n s p o r t i n g i t fr o m t h e h a r b o u r t o J o h a n n e s b u r g w a s a l r e a d y in c l u d e d i n t h e o r i g i n a l q u o t e o n t h e b a s i s o f w h ic h t h e p a r t ie s c o n tr a c t e d ? M R T H O B A N I T R E V O R M N YA N D U : T h a t i s c o r r e c t C h a ir. A D V M A H L A P E S E L L O : T h a n k y o u . Ye s y o u m a y p r o c e e d , t h a n k y o u . M R T H O B A N I T R E V O R M N YA N D U : T h a n k y o u . C h a ir t o t a k e y o u t h e n t o a li n e i t e m t h a t d e n o t e d i n t h is q u o t a t i o n w h a t w o u l d b e a s a v i n g f o r Tr a n s n e t w e u s e a g a i n a n i te m t h a t h a s a s i m il a r a m o u n t o f R 8 0 0 0 . I t is i n r e l a ti o n t o w h e e ls a n d a x le s . A D V M A H L A P E S E L L O : T h a t w il l b e th e s e v e n t h e n tr y – I t h in k . 20 M R T H O B A N I T R E V O R M N YA N D U : T h e e i g h t h . CHAIRPERSON: A D V M A H L A P E S E L L O : E i g h t h e n tr y o n t h e le f t c o l u m n , y e s . M R T H O B A N I T R E V O R M N YA N D U : Ja. d e n o te d t h e r e w a s a n a m o u n t o f R 8 0 0 0 . s e e o n th e fa r r i g h t h a n d s id e i s … Page 26 of 116 C h a ir th e s a v i n g t h a t w a s T h e c o m m e n t t h a t y o u w i ll 30 MAY 2019 – DAY 102 C H A I R P E R S O N : I a m s o r r y. Th e r e a r e t w o R 8 0 0 0 e n tr ie s th e r e u n d e r “ S a v i n g s ” . W h ic h o n e a r e y o u d e a l in g w i t h ? ADV MAHLAPE SELLO: M R T H O B A N I T R E V O R M N YA N D U : W h e e l s a n d a x le s . A D V M A H L A P E S E L L O : W h ic h s h o u l d b e t h e s e c o n d o n e C h a ir. CHAIRPERSON: Oh, okay the second one. A D V M A H L A P E S E L L O : Ye s C h a ir. M R T H O B A N I T R E V O R M N YA N D U : Ye s C h a ir. C H A I R P E R S O N : O k a y, th a n k y o u . 10 M R T H O B A N I T R E V O R M N YA N D U : Th e c o m m e n t o n t h e f a r r ig h t h a n d s id e r e a d s i m p o r t e d c o m p o n e n ts . ADV MAHLAPE SELLO: Huh-uh. M R T H O B A N I T R E V O R M N YA N D U : T h e u n d e r s t a n d i n g is t h a t th e w h e e l s a n d a x le s w o u l d t h e r e f o r e b e i m p o r te d to t h e D u r b a n H a r b o u r. T h e r e w o u l d n o t b e a c o s t t o b r i n g th e m u p to J o h a n n e s b u r g a n d r e t u r n t h e m a n d th e r e fo r e t h e r e w o u l d b e a c o s t s a v i n g o f R 8 0 0 0 f o r Tr a n s n e t . A D V M A H L A P E S E L L O : P l e a s e e x p la in t h a t a g a i n M r M n y a n d u . M R T H O B A N I T R E V O R M N YA N D U : 20 In respect of wheels and axles an a m o u n t o f R 8 0 0 0 w o u ld n o t b e i n c u r r e d a n d i t w o u ld b e a s a v i n g fo r Tr a n s n e t i n t h a t t h e w h e e ls a n d th e a x l e s … A D V M A H L A P E S E L L O : O k a y. M R T H O B A N I T R E V O R M N YA N D U : W h ic h a r e p a r ts o f t h e l o c o m o ti v e w o u ld b e i m p o r te d t o D u r b a n t a k e n fr o m D u r b a n to t h e s i t e … A D V M A H L A P E S E L L O : O k a y. Page 27 of 116 30 MAY 2019 – DAY 102 M R T H O B A N I T R E V O R M N YA N D U : F o r m a n u f a c tu r e . CHAIRPERSON: W h a t is t h e s ig n if ic a n c e o f th e t w o a m o u n ts b e in g e x a c tl y t h e s a m e i n r e g a r d t o t h e e n g in e a n d t h e w h e e ls a n d a x l e s ? M R T H O B A N I T R E V O R M N YA N D U : C h a i r – C h a ir t h e r e is n o t . I t h o u g h t i t w o u ld b e e a s i e r t o f in d o n th e s l id e a n d t h a t is w h y I r e fe r r e d y o u t o th e R 8 0 0 0 . CHAIRPERSON: W e ll is i t n o t a n i n d ic a ti o n th a t i t is – it r e l a t e s t o tr a n s p o r t a ti o n b e c a u s e t h e tr a n s p o r t a ti o n f r o m D u r b a n t o J o h a n n e s b u r g w o u ld p r o b a b ly c o s t th e s a m e ? 10 I d o n o t k n o w w h e th e r th a t is p e tr o l a n d w h a t e v e r e ls e b e c a u s e o th e r w is e v e r y i n t e r e s ti n g t h a t i t s h o u ld b e e x a c tl y t h e s a m e a m o u n t . I f y o u a r e g o in g to u s e th e s a m e … M R T H O B A N I T R E V O R M N YA N D U : ( I n d is t in c t ) . CHAIRPERSON: If it is tr a n s p o r t a ti o n s o y o u t a l k a b o u t p e tr o l. Yo u t a lk a b o u t w h a t e v e r e ls e th e n o n e c o u l d u n d e r s t a n d i f i t i s e x a c tly t h e s a m e a m o u n t . O t h e r w is e i t is d i ffic u l t t o u n d e r s t a n d w h y t h e r e s h o u l d b e t h i s c o i n c i d e n c e t h a t i t is t h e s a m e a m o u n t s . M R T H O B A N I T R E V O R M N YA N D U : C h a ir y o u r c o n c l u s i o n is a lo g i c a l o n e to f o l l o w. … CHAIRPERSON: Hm. 20 M R T H O B A N I T R E V O R M N YA N D U : Fr o m w h a t i s i n t h e d o c u m e n t . CHAIRPERSON: Hm. M R T H O B A N I T R E V O R M N YA N D U : Ye s . C H A I R P E R S O N : H m . O k a y, t h a n k y o u . A D V M A H L A P E S E L L O : A n d o n th a t b a s is w e m a y a s s u m e t h e n s e e i n g a s it is a s a v i n g th a t t h a t tr a n s p o r t c o s t o f th e w h e e l s a n d t h e a x l e s Page 28 of 116 30 MAY 2019 – DAY 102 w o u ld h a v e f o r m e d p a r t o f t h e o r i g i n a l q u o t a ti o n ? M R T H O B A N I T R E V O R M N YA N D U : T h a t i s t o b e u n d e r s t o o d fr o m t h e quotation. ADV MAHLAPE SELLO: And it is a saving because now they no longer h a v e t o b e tr a n s p o r t e d t o J o h a n n e s b u r g w h e n t h e y g e t t o th e D u r b a n Harbour? M R T H O B A N I T R E V O R M N YA N D U : I n d e e d i t is s o C h a ir. A D V M A H L A P E S E L L O : O k a y. M R T H O B A N I T R E V O R M N YA N D U : 10 C h a ir - w e t h e n t a k e y o u to s li d e n u m b e r 1 0 to d e a l w i th th e n e x t s e c ti o n o f t h e q u o t a t i o n th a t s t a r ts a t page 40. A D V M A H L A P E S E L L O : S o r r y b e f o r e y o u d o s o . T h e r e s e e m s to b e a – a fi x e d a m o u n t a t o t a l c o s t fo r t h e r e c o ll e c ti o n a t th e b o t t o m o f n in e ? M R T H O B A N I T R E V O R M N YA N D U : Ye s . A D V M A H L A P E S E L L O : A n d t h a t is 4 m il li o n ? M R T H O B A N I T R E V O R M N YA N D U : 4 m il li o n . ADV MAHLAPE SELLO: So we are informed by CNR that these a d j u s t m e n t s - a d d s o m e d e d u c t o t h e r s - th e c o s t w il l b e 4 m i ll io n ? M R T H O B A N I T R E V O R M N YA N D U : I n d e e d i t is s o C h a ir. 20 A D V M A H L A P E S E L L O : O k a y. T h e n w e g o o v e r l e a f . M R T H O B A N I T R E V O R M N YA N D U : T h e n w e g o o v e r l e a f . A D V M A H L A P E S E L L O : Ye s . M R T H O B A N I T R E V O R M N YA N D U : O v e r l e a f i t is t h e s e c o n d p a r t o f … C H A I R P E R S O N : I a m – I a m s o r r y. M R T H O B A N I T R E V O R M N YA N D U : Ye s C h a ir. Page 29 of 116 30 MAY 2019 – DAY 102 C H A I R P E R S O N : Is t h a t 4 m il li o n th e to t a l o f a l l t h e o t h e r i t e m s u n d e r “ E x tr a C o s t ” ? I s t h a t t o t a l o f a l l th e – o r n o t o r is i t a s e p a r a te – is i t a … M R T H O B A N I T R E V O R M N YA N D U : C h a ir t h e … C H A I R P E R S O N : A n e x tr a c o s t o n it s o w n n o t t o t a ll in g ? M R T H O B A N I T R E V O R M N YA N D U : C h a ir it t o t a ls a ll o f t h e e x tr a c o s t s t h a t a r e t o b e f o u n d i n t h e c o lu m n i n w h i c h it a p p e a r s . S o i t is a s u m made up of … C H A I R P E R S O N : I – n o , n o i t c a n n o t b e . My – m y a r i t h m e ti c is n o t s o 10 good but … M R T H O B A N I T R E V O R M N YA N D U : C h a ir f o r t h e p u r p o s e … CHAIRPERSON: T h a t 4 m il li o n t h e h i g h e s t o f t h o s e a m o u n ts is R 4 0 0 0 0 . T h e n e x t h i g h e s t is R 2 0 0 0 0 . A ll th e o t h e r s a r e t o o s m a l l t o m a k e u p 4 m il li o n . M R T H O B A N I T R E V O R M N YA N D U : C h a ir f o r t h e p u r p o s e s o f – t h i s is a c o s t a n d e x t r a c o s t p e r l o c o m o tiv e . A D V M A H L A P E S E L L O : P e r l o c o m o tiv e . M R T H O B A N I T R E V O R M N YA N D U : For the purposes of our p r e s e n t a ti o n … 20 C H A I R P E R S O N : Th e fo u r – t h e 4 m i ll io n ? Th e o n e y o u s a y i s a n e x tr a c o s t p e r l o c o m o tiv e ? M R T H O B A N I T R E V O R M N YA N D U : I t i s s u p p o s e d to b e t h e t o t a l f o r a l l lo c o m o t iv e s . C H A I R P E R S O N : Fo r a ll l o c o m o t iv e s ? A D V M A H L A P E S E L L O : Ye s . Page 30 of 116 30 MAY 2019 – DAY 102 M R T H O B A N I T R E V O R M N YA N D U : F o r a l l l o c o m o t iv e s . CHAIRPERSON: So it is not a total of adding up the amounts that are a b o v e th e 4 m ill i o n in t h a t c o lu m n ? M R T H O B A N I T R E V O R M N YA N D U : Ye s C h a ir. C H A I R P E R S O N : O k a y. N o … A D V M A H L A P E S E L L O : Ye s . C H A I R P E R S O N : O k a y, o k a y. M R T H O B A N I T R E V O R M N YA N D U : But you can accept Chair even though … 10 C H A I R P E R S O N : ( In d is ti n c t) . M R T H O B A N I T R E V O R M N YA N D U : Yo u c a n a c c e p t C h a ir e v e n t h o u g h nothing turns on it. C H A I R P E R S O N : Ye s . M R T H O B A N I T R E V O R M N YA N D U : T h a t o n a n y s c o r e … CHAIRPERSON: Ja. M R T H O B A N I T R E V O R M N YA N D U : Th e a m o u n t th a t is t h e – t h e t o t a l there … CHAIRPERSON: Ja. M R T H O B A N I T R E V O R M N YA N D U : Is in c o r r e c t . 20 C H A I R P E R S O N : O k a y. M R T H O B A N I T R E V O R M N YA N D U : J a . C H A I R P E R S O N : O k a y. M R T H O B A N I T R E V O R M N YA N D U : I t i s a l i t tl e u n d e r R 5 m il li o n o n o u r c a l c u l a ti o n s . C H A I R P E R S O N : O k a y. Page 31 of 116 30 MAY 2019 – DAY 102 M R T H O B A N I T R E V O R M N YA N D U : Ye s C h a ir. C H A I R P E R S O N : O k a y. A D V M A H L A P E S E L L O : O k a y. M R T H O B A N I T R E V O R M N YA N D U : T h e n e x t p a r t o f t h e p r e s e n ta t io n a t s li d e 1 0 w e d e a l w it h t h e n e x t p a r t o f t h e q u o t a t io n a n d t h is r e l a t e s t o t h e s u b je c t o f t h e i m p o r t e d l o c o m o tiv e . W h a t w e a r e to u n d e r s ta n d fr o m t h i s is t h a t t h e r e w o u l d b e a s a v i n g s o f i m p o r t e d l o c o m o t iv e s . Th e n u m b e r i n b r a c k e t s is t h e n u m b e r o f l o c o m o t iv e s th a t w o u ld b e i m p o r t e d a n d t h e s a v i n g is d e n o t e d a s R 1 m il li o n . Fo r l o c o m o ti v e s th a t 10 w o u ld b e f u l ly a s s e m b le d a n d s h i p p e d t o t h e D u r b a n H a r b o u r. A D V M A H L A P E S E L L O : Ye s . M R T H O B A N I T R E V O R M N YA N D U : W h a t w e a r e to … C H A I R P E R S O N : I a m s o r r y. Pl e a s e j u s t g o b a c k . M R T H O B A N I T R E V O R M N YA N D U : Ye s C h a ir. C H A I R P E R S O N : T h e n u m b e r i n b r a c k e t s r e p r e s e n ts w h a t ? M R T H O B A N I T R E V O R M N YA N D U : Th e n u m b e r o f l o c o m o t iv e s th a t w o u ld b e f u l ly a s s e m b le d i n C h i n a a n d tr a n s p o r te d b y s h i p to D u r b a n . C H A I R P E R S O N : O k a y, a lr ig h t . M R T H O B A N I T R E V O R M N YA N D U : Ye s . 20 C H A I R P E R S O N : O k a y. M R T H O B A N I T R E V O R M N YA N D U : r e l a ti o n to 20 l o c o m o tiv e s that S o th e s a v i n g s o f R 1 m il li o n i s in would not be tr a n s p o r t e d to Johannesburg. ADV MAHLAPE SELLO: A n d i n t h is i n s t a n c e th e R 1 m il li o n s a v i n g is n o t p e r l o c o m o tiv e . It is a t o ta l s a v in g o n t h e 2 0 ? Page 32 of 116 30 MAY 2019 – DAY 102 M R T H O B A N I T R E V O R M N YA N D U : I n d e e d i t is s o C h a ir. A D V M A H L A P E S E L L O : O k a y. M R T H O B A N I T R E V O R M N YA N D U : T h e n e x t li n e i te m d e a ls w i t h s a v in g s o n k it s a n d 1 5 o f t h e m . C h a ir b e f o r e w e ta k e y o u th r o u g h th e a m o u n t w e w o u ld j u s t l ik e e x p l a i n w h a t k i t s a r e . It r e la t e s to t h e b o g i e w h ic h is a p a r t o f t h e l o c o m o ti v e , t h e u n d e r fr a m e a n d s o m e b o d y p a n e l s t h a t w o u l d b e i m p o r t e d fr o m D a li a n . J u s t to g iv e c o n t e x t to th e c o n v e r s a ti o n fr o m t h a t p e r s p e c t iv e 1 5 l o c o m o t iv e s w e r e g o in g t o b e p r o d u c e d b y C N R a s s e m i k n o c k d o w n k i ts . T h a t is t o s a y s o m e o f i t is 10 m a n u f a c t u r e d in C h in a a n d t h e n s o m e o f i t – t h e p a r ts a r e i m p o r t e d t o S o u th A f r i c a a n d th e n fu ll a s s e m b ly h a p p e n s in S o u t h A fr ic a . The a m o u n t t h a t w a s d e n o t e d a s a s a v i n g t h e r e w a s R 2 8 5 0 0 0 . A g a in w e u n d e r s t a n d o n th e b a s i s t h a t th e 1 5 k i ts w o u ld t h e n n o t n e e d t o tr a v e l to – inland. C h a ir y o u w i ll s e e i n t h e n e x t c o l u m n b e lo w th a t i s t h e t o t a l s a v i n g fr o m t h a t p e r s p e c ti v e a n d it a m o u n t s t o R 1 2 8 5 0 0 0 . A D V M A H L A P E S E L L O : Ye s . M R T H O B A N I T R E V O R M N YA N D U : And therefore the last it says the t o t a l e x tr a c o s ts is R 2 . 7 9 m i ll io n . It is R 2 7 9 2 9 0 0 fo r t h e C h a ir. A D V M A H L A P E S E L L O : A r i t h m e tic a lly d o e s th a t a d d u p ? 20 M R T H O B A N I T R E V O R M N YA N D U : A r i t h m e t ic a ll y t h a t d o e s n o t a d d up. A D V M A H L A P E S E L L O : O k a y. M R T H O B A N I T R E V O R M N YA N D U : C h a ir t h e f i n a l p a r t o f t h e q u o t a ti o n r e c e i v e d f r o m C N R d u r i n g M a r c h 2 0 1 4 is m a d e u p o f c o s t r e la t e d t o Fl i g h t s a n d Ac c o m m o d a t io n r e fe r r e d to a s F N A C o s ts . Page 33 of 116 The quotation 30 MAY 2019 – DAY 102 p r o c e e d s fr o m th e b a s is t h a t th e r e w o u l d b e a m i n i m u m o f f o u r p e o p le t o f ly to D u r b a n e v e r y w e e k fr o m J o h a n n e s b u r g . A D V M A H L A P E S E L L O : Ye s . M R T H O B A N I T R E V O R M N YA N D U : T h a t c o s t i s d e n o t e d a s a n a m o u n t of R1 320 000 and a c c o m m o d a ti o n . th e next l in e item is in r e l a ti o n to the F r o m t h e r e a d in g o f t h e q u o t a ti o n w e a r e m a d e t o u n d e r s t a n d t h a t i t w o u ld b e t h e a c c o m m o d a ti o n f o r t h e f o u r p e o p le fl y i n g t o D u r b a n . T h a t a m o u n t i s p u t d o w n a s R 9 6 0 0 0 0 . T h e r e i s n o in d i c a t io n a s to w h a t t h e fl ig h ts w o u l d b e . T h e r e i s n o i n d ic a ti o n a s to 10 w h e r e th e a m o u n ts a r e q u o te d fr o m . ADV MAHLAPE SELLO: A n d b e fo r e y o u – y o u l e a v e t h a t p o i n t g o i n g b a c k t o M r H a r r is ’ c o n c lu s i o n th a t n e i th e r B o m b a d ie r n o r C N R h a d a b a s e in J o h a n n e s b u r g . Pr e s u m a b ly th e r e w a s n o p e r s o n n e l a s w e ll ? M R T H O B A N I T R E V O R M N YA N D U : Ye s C h a ir. A D V M A H L A P E S E L L O : A n d y o u r c o n c l u s io n t h a t a s a f a c t t h e r e f o r e i t c o u l d n o t h a v e r e l o c a te d fr o m J o h a n n e s b u r g t o g e t t o D u r b a n o r to b e placed in Durban? M R T H O B A N I T R E V O R M N YA N D U : Ye s C h a ir. ADV MAHLAPE SELLO: 20 D o y o u h a v e a n i n d ic a ti o n o f w h o th e s e fo u r p e o p l e a r e t h a t fl y fr o m J o h a n n e s b u r g e v e r y w e e k a n d w h y th e y m u s t fl y fr o m J o h a n n e s b u r g t o D u r b a n e v e r y w e e k ? M R T H O B A N I T R E V O R M N YA N D U : N o w e d o n o t C h a ir. ADV MAHLAPE SELLO: I s th e r e a n y d o c u m e n t a ti o n th a t y o u h a v e s e e n w h e r e Tr a n s n e t i n t e r r o g a t e s b o t h t h e fi g u r e s a n d t h e b a s is f o r t h e fi g u r e s i n th is r e g a r d ? Page 34 of 116 30 MAY 2019 – DAY 102 M R T H O B A N I T R E V O R M N YA N D U : N o t h e r e is n o t s u c h a d o c u m e n t C h a ir. A D V M A H L A P E S E L L O : O k a y, t h a n k y o u . M R T H O B A N I T R E V O R M N YA N D U : C h a ir t h e e x tr a F N A C o s t s d e n o t e d o n t h i s s l id e i s f o r F li g h t s a n d A c c o m m o d a ti o n is s i m p ly a d d i n g t h e t w o a m o u n ts . I t is R 2 2 8 0 0 0 0 . C h a ir t h e la s t i t e m th a t w a s d e a l t w i th i n r e s p e c t o f t h e q u o ta t io n w a s n e w o ffic e s e t u p f o r 6 0 p e r s o n n e l a n d t h a t a m o u n t w a s R 6 0 4 8 0 0 . Th e la s t p o i n t to b e m a d e is t h a t t h e t o ta l e x tr a c o s t s a s i n d ic a t e d i n 1 0 M a r c h 2 0 1 4 q u o t a t i o n r e c e i v e d fr o m C N R 10 w a s t h a t i t w a s g o i n g t o c o s t R 9 7 5 5 6 0 0 f o r i t to b e l o c a te d i n D u r b a n . ADV MAHLAPE SELLO: A n d t h a t is m a d e u p o f th e 4 m i ll io n – y o u r s li d e 9 ? M R T H O B A N I T R E V O R M N YA N D U : Ye s C h a ir. ADV MAHLAPE SELLO: P l u s t h e 2 . 7 m il li o n a t s li d e 7 w h ic h a r e s a v in g s o r e x tr a c o s ts i n r e l a ti o n t o i m p o r t e d l o c o m o ti v e a n d w h a t t h e y d e n o te a s F li g h t a n d A c c o m m o d a ti o n C o s ts a n d o ffic e s f o r n e w p e r s o n n e l . A l l t h a t t a k e n t o g e t h e r w i ll g iv e a t o ta l o f 9 .7 m i ll io n … M R T H O B A N I T R E V O R M N YA N D U : To g e t h e r … A D V M A H L A P E S E L L O : A c c o r d i n g t o th is d o c u m e n t ? 20 M R T H O B A N I T R E V O R M N YA N D U : Ye s C h a ir t o g e t h e r w i th th e to t a l e x tr a t r a n s p o r t c o s ts . A D V M A H L A P E S E L L O : Ye s . M R T H O B A N I T R E V O R M N YA N D U : T h a t i s c o r r e c t . A D V M A H L A P E S E L L O : Ye s , th a n k y o u . P l e a s e p r o c e e d . M R T H O B A N I T R E V O R M N YA N D U : T h a n k y o u C h a ir. Page 35 of 116 C h a ir w e n o w 30 MAY 2019 – DAY 102 seek to take you through the approval process of the cost for r e l o c a ti o n . A D V M A H L A P E S E L L O : Ye s . CHAIRPERSON: T h a t 9 . 7 m il li o n t o t a l e x tr a c o s t s is t h a t t h e a m o u n t t h a t w a s – a r r iv e d a t b y – th a t Mr – i s M r G o n s a lv e s ? A D V M A H L A P E S E L L O : M r G o n s a lv e s , y e s C h a ir. C H A I R P E R S O N : Mr G o n s a l v e s h e is t h e o n e w h o ( i n t e r v e n e s ) . ADV MAHLAPE SELLO: I t i s Mr G o n s a lv e s w h o te s ti fi e d o n b e h a l f o f t h e m i n o r i ty s h a r e h o ld e r i n t h e C N R C o n s o r ti u m . 10 CHAIRPERSON: Ye s . T h a t – th a t is t h e a m o u n t th a t h e w a s t a l k i n g a b o u t. A D V M A H L A P E S E L L O : T h a t is t h e a m o u n t t h a t h e w a s t a lk i n g a b o u t . CHAIRPERSON: O k a y, a lr i g h t b u t b a s e d o n w h a t y o u h a v e s a i d e v e n t h a t a m o u n t t h e r e a r e c e r t a i n th in g s t h a t a r e n o t e x p la i n e d . Is th a t r ig h t ? M R T H O B A N I T R E V O R M N YA N D U : I n d e e d t h a t is s o C h a ir. C H A I R P E R S O N : S o th a t m a y b e – m a y b e n o t th e tr u e c o s ts m ig h t h a v e been lower? M R T H O B A N I T R E V O R M N YA N D U : I n d e e d – in d e e d i t is s o C h a ir. 20 CHAIRPERSON: Thank you. A D V M A H L A P E S E L L O : Ye s M r M n y a n d u y o u m a y p r o c e e d . M R T H O B A N I T R E V O R M N YA N D U : C h a ir a t s li d e n u m b e r 1 2 w e n o w s e e k t o t a k e y o u th r o u g h th e a p p r o v a l p r o c e s s in r e l a ti o n t o t h e c o s t o f r e l o c a ti o n . W e fir s t s e e k t o h i g h li g h t s o m e s a li e n t p o i n ts i n r e la t io n to C N R a n d th e n d e a l w i th B T b e fo r e w e g e t t o t h e a c t u a l a p p r o v a l o f th e Page 36 of 116 30 MAY 2019 – DAY 102 c o s ts . P u r s u a n t t o th e r e c e i p t b y Tr a n s n e t o f t h e q u o t a ti o n o f R 9 . 7 m il li o n b y C N R w e h a v e f o u n d t h a t t h e r e w e r e n o f u r th e r e n g a g e m e n ts d u r i n g t h e y e a r 2 0 1 4 u n t il F e b r u a r y 2 0 1 5 d u r i n g w h ic h a p r o p o s a l w a s s u b m i tt e d b y C N R w h i c h e s t i m a t e s t h e c o s ts i n s id e t h e t e x t o f t h e r e p o r t t o b e a p p r o x i m a te ly R 1 0 0 m il li o n f o r r e l o c a ti o n . H o w e v e r i n t h e s a m e d o c u m e n t C h a ir i t a ls o r e fl e c ts a t t h e e n d o f i t a n e s ti m a t e o f R 3 1 8 m il li o n . C h a ir t h a t is t o b e fo u n d a t v o l u m e 1 2 p a g e 9 0 1 3 . A D V M A H L A P E S E L L O : Ye s . M R T H O B A N I T R E V O R M N YA N D U : 10 We have no record and we have n o t s e e n s u c h a r e c o r d i n o u r i n v e s t ig a ti o n o f t h e q u o t a ti o n h a v i n g b e e n i n t e r r o g a t e d , h a v i n g b e e n r e s p o n d e d t o b y Tr a n s n e t b u t w e g a t h e r fr o m t h e f u r th e r c o r r e s p o n d e n c e s t h a t th e r e w e r e t h a t s u c h a q u o t a ti o n was not accepted. C h a ir a p r e v io u s w i t n e s s – M r G o n s a lv e s – h a s a lr e a d y l e d e v id e n c e a b o u t a n a g r e e m e n t t h a t w e s p e a k a b o u t a t s l id e 12. A D V M A H L A P E S E L L O : B e f o r e w e g e t to t h a t w e h a v e – I h a v e t u r n e d to your page – the document at 9013 volume - volume 12 – your A p p e n d i x 7 a n d i n p a r t ic u l a r I a m a t p a g e 9 0 1 7 . M R T H O B A N I T R E V O R M N YA N D U : Ye s C h a ir. 20 A D V M A H L A P E S E L L O : A n d u n d e r i te m 4 “ P o t e n t i a l C o s t I n c r e a s e ” . M R T H O B A N I T R E V O R M N YA N D U : Ye s C h a ir. ADV MAHLAPE SELLO: U n d e r s t a n d in g s e q u e n c e o f e v e n ts Tr a n s n e t w a s p r o v i d e d w i t h t h e 9 - o d d m i ll io n i n c r e a s e to t h e c o s t – n o – 9 - o d d m il li o n … M R T H O B A N I T R E V O R M N YA N D U : Q u o ta t io n . Page 37 of 116 30 MAY 2019 – DAY 102 A D V M A H L A P E S E L L O : C o s t fo r r e lo c a t io n t o D u r b a n ? M R T H O B A N I T R E V O R M N YA N D U : Ye s C h a ir. ADV MAHLAPE SELLO: S o w e a r e s o m e w h e r e i n th e b a ll p a r k o f 1 0 m il li o n ? M R T H O B A N I T R E V O R M N YA N D U : Ye s C h a ir. ADV MAHLAPE SELLO: S u b s e q u e n t ly a n d i n F e b r u a r y 2 0 1 5 Tr a n s n e t is t h e n s e r v e d w i t h th is d o c u m e n t a n d a t i t e m 4 i t s t a t e s : “ I t is e s t i m a te d th a t i t w i ll g e t t h e c o s t in c r e a s e … ” T h a t is th e r e l o c a ti o n . 10 M R T H O B A N I T R E V O R M N YA N D U : Ye s C h a ir. A D V M A H L A P E S E L L O : T h e c o s t w il l b e m o r e t h a n 1 0 0 m i ll io n s u c h a s t h e f o l l o w i n g f ie l d s : tr a n s p o r t a ti o n c o s t in c r e a s e , h u m a n s t a ff c o s t in c r e a s e , te c h n i c a l c o s t i n c r e a s e . M R T H O B A N I T R E V O R M N YA N D U : Ye s C h a ir. ADV MAHLAPE SELLO: T h a t is 9 0 m il l io n d i ffe r e n c e b e tw e e n th is a m o u n t a n d th e p r e v i o u s ly q u o te d q u o t a t i o n o f 1 0 m i ll io n ? M R T H O B A N I T R E V O R M N YA N D U : Ye s i t i s C h a ir i n th e s p a c e o f 11 m o n th s . ADV MAHLAPE SELLO: 20 Were you able to get any understanding on h o w t h is c a m e a b o u t a n d t h e j u s ti f ic a ti o n f o r th is j u m p ? M R T H O B A N I T R E V O R M N YA N D U : N o w e w e r e n o t C h a ir. A D V M A H L A P E S E L L O : D i d y o u m a k e e n q u ir ie s ? M R T H O B A N I T R E V O R M N YA N D U : W e tr i e d m a k i n g e n q u i r i e s th r o u g h t h e d o c u m e n t a ti o n i ts e l f … A D V M A H L A P E S E L L O : O k a y. Page 38 of 116 30 MAY 2019 – DAY 102 M R T H O B A N I T R E V O R M N YA N D U : B u t h o w e v e r th e p r o p o s a l s g iv e s n o in d ic a t i o n . ADV MAHLAPE SELLO: D o e s t h i s d o c u m e n t m a k e r e fe r e n c e t o t h e p r e v i o u s R 9 m i ll io n q u o ta t io n ? M R T H O B A N I T R E V O R M N YA N D U : N o i t d o e s n o t C h a ir. A D V M A H L A P E S E L L O : O k a y. T h a n k y o u . Yo u m a y p r o c e e d . M R T H O B A N I T R E V O R M N YA N D U : D u r in g A p r il 2 0 1 5 C h a ir we d is c o v e r e d a n a g r e e m e n t w h ic h I h a v e – a lr e a d y h a s b e e n h i g h l ig h t e d t o th e C h a ir – w a s d e a l t w i t h M r G o n s a lv e s w h o is a m i n o r i ty 10 s h a r e h o l d e r a n d a D ir e c t o r o f t h e C N R C o n s o r t iu m . The agreement w a s c o n c lu d e d b e t w e e n C N R a n d B E X – B u s i n e s s E x p a n s i o n S t r u c t u r e d – a c o m p a n y t h a t w a s g o i n g to a s s i s t C N R w it h t h e b e n c h m a r k i n g o f it s r e l o c a ti o n c o s t s . I t i s a n a g r e e m e n t a s I s a y C h a ir t h a t is t o b e fo u n d a t v o l u m e 1 2 p a g e 9 0 2 2 in c o n s u l t a ti o n w i t h t h e e v i d e n c e le a d e r s to t h e e x t e n t th a t e v i d e n c e h a s a lr e a d y b e e n l e d o n i t . W e s h a l l n o t c o v e r i t s a v e t o c o n fir m t o t h e C h a i r th a t a c o p y o f t h e a g r e e m e n t w a s o b t a i n e d fr o m Tr a n s n e t a n d i t is th e e x a c t a g r e e m e n t th a t is o n r e c o r d i n t h e e v i d e n c e b u n d le s o f th e C o m m i s s i o n . A D V M A H L A P E S E L L O : A n d a g a i n I a m – t h e v e r y d o c u m e n t t h a t s a id 20 t h e c o s t w i ll b e i n e x c e s s o f 1 0 0 m i ll io n i n f a c t g a v e a n e w c o s t o f 3 8 0 m il li o n ? M R T H O B A N I T R E V O R M N YA N D U : Ye s t h a t is c o r r e c t C h a ir. ADV MAHLAPE SELLO: S o t h e l ip is a c t u a lly fr o m 9 m i ll io n t o 3 8 0 m il li o n i n 11 m o n th s ? M R T H O B A N I T R E V O R M N YA N D U : I n d e e d i t is s o C h a ir. Page 39 of 116 30 MAY 2019 – DAY 102 ADV MAHLAPE SELLO: Th a n k y o u . Yo u m a y p r o c e e d . Yo u a r e d e a li n g w it h th e B E X A g r e e m e n t . M R T H O B A N I T R E V O R M N YA N D U : Ye s . C h a ir w h ils t w e d o n o t d e a l e x t e n s iv e ly w i th t h e B E X A g r e e m e n t – r a t h e r t h e a g r e e m e n t b e t w e e n C N R a n d B E X – w e d o p o i n t o u t th a t B E X w e r e e n ti tl e d t o e a r n t h e d i ff e r e n c e b e t w e e n 5 8 0 m i ll i o n a n d R 6 4 7 m i ll io n . O n o u r c a lc u la t io n t h a t w o r k s o u t t o R 6 7 m i ll i o n f o r c o m p u t i n g th e c o s ts . A D V M A H L A P E S E L L O : Ye s . M R T H O B A N I T R E V O R M N YA N D U : W h i ls t w e a r e n o t – c a n n o t c o n fir m 10 t h e d a t e o n w h ic h p a y m e n t w a s m a d e C h a ir w e h a v e s e e n a n i n v o i c e n u m b e r o n e a n d th e a t to r n e y s f o r C N R h a v e c o n fi r m e d t h a t p a y m e n t was indeed made. C h a ir t h is is to b e f o u n d a t p a g e 9 0 3 5 o f y o u r v o l u m e 1 2 b u n d le . A D V M A H L A P E S E L L O : Ye s . Is i t n e c e s s a r y t o g o t h e r e ? C H A I R P E R S O N : W e l l d o e s th e s li d e n o t s a y n i n e – A p p e n d ix 9 ? ADV MAHLAPE SELLO: It is Appendix 9. C H A I R P E R S O N : O h . O k a y, o n v o l u m e 1 2 ? ADV MAHLAPE SELLO: On volume 12. CHAIRPERSON: Oh, okay yes. 20 ADV MAHLAPE SELLO: And … C H A I R P E R S O N : D o w e n e e d to g o t h e r e t o t h a t p a g e ? ADV MAHLAPE SELLO: Mr Mnyandu let me just check with you. That is t h e s a m e i n v o i c e t h a t M r G o n s a lv e s l e d e v i d e n c e o n ? M R T H O B A N I T R E V O R M N YA N D U : Ye s it is s o C h a ir. A D V M A H L A P E S E L L O : Yo u h a v e s e e n th e i n v o i c e a lr e a d y C h a ir. Page 40 of 116 30 MAY 2019 – DAY 102 CHAIRPERSON: Ja. A D V M A H L A P E S E L L O : Ye s . CHAIRPERSON: No that is fine. ADV MAHLAPE SELLO: S o w e m a y p r o c e e d o n th a t b a s i s . We are f a m ili a r w i t h th e i n v o i c e . M R T H O B A N I T R E V O R M N YA N D U : C h a ir th e r e is a p a r t ic u l a r p a r a g r a p h t h a t w e w o u l d li k e t o t a k e t h e C h a ir th r o u g h . A D V M A H L A P E S E L L O : O k a y. C H A I R P E R S O N : Ye s p le a s e d o s o . 10 A D V M A H L A P E S E L L O : ( I n te r v e n e s ) . M R T H O B A N I T R E V O R M N YA N D U : W h i c h a s s is ts o r r a t h e r a s s is t e d u s in f o r m in g a p r i m a fa c i e v i e w i n r e l a ti o n t o . . . ADV MAHLAPE SELLO: At 9036? M R T H O B A N I T R E V O R M N YA N D U : A t 9 0 3 6 o n c e th e C h a i r is t h e r e . A D V M A H L A P E S E L L O : Ye s . M R T H O B A N I T R E V O R M N YA N D U : T h e C h a ir w i ll n o t e i t is a le t t e r o n t h e le t t e r h e a d o f H o g a n L o v e l ls A t t o r n e y s . A D V M A H L A P E S E L L O : Ye s . M R T H O B A N I T R E V O R M N YA N D U : 20 T h e s u b je c t r e a d s , r e p o r t a b l e ir r e g u l a r i ty C R R C R o lli n g S t o c k o u r c l i e n t. T h e C h a ir w ill n o t i t is a d d r e s s e d t o K P M G a n d h e c o n t e x t to i t i s th a t th e r e h a d b e e n th e r e p o r t in g o f a n a c c o u n t i n g ir r e g u la r i ty in r e l a ti o n to t h e p a y m e n t o f 6 7 m i ll io n r a n d t o B e c k s w h ic h K P M G h a d f o u n d , t h e C h a ir w i ll s e e th e s u m m a r i s e d a t p a r a g r a p h 1 . 3 a s f o l lo w s , “ W e u n d e r s ta n d th a t a t th is t i m e a n d o n t h e b a s i s o f t h e Page 41 of 116 30 MAY 2019 – DAY 102 in f o r m a ti o n p r o v id e d t o y o u , y o u a r e o f t h e v i e w t h a t t h e p r o p o s a l a n d t h e a g r e e m e n t c o n t a i n a ll e g e d ir r e g u l a r i ti e s f o r the f o ll o w i n g reasons. 1) the proposal s ig n if ic a n tly m is r e p r e s e n t e d to Tr a n s n e t t h e c o s t o f r e l o c a ti o n o f r e lo c a t io n o f a m a n u f a c tu r i n g f a c il i ty fr o m P r e to r i a t o D u r b a n a n d 2 ) a p a y m e n t m a d e b y o u r c l ie n t t o B e c k s a p p e a r to “l a c k s o u n d c o m m e r c ia l s u b s ta n c e a n d p u r p o s e ” . C h a ir w i t h o u t d e ta in i n g y o u w e w o u l d l ik e t o t a k e y o u t o p a r a g r a p h 2 .1 … ( in t e r v e n ti o n ) . 10 CHAIRPERSON: I’ m s o r r y is t h i s t h e p a r t y o u w e r e r e ly i n g o n t o s a y t h e a tt o r n e y s h a v e c o n fi r m e d p a y m e n t ? M R T H O B A N I T R E V O R M N YA N D U : Ye s C h a ir C H A I R P E R S O N : T h is is th e p a r t y o u w e r e r e l y i n g o n ? M R T H O B A N I T R E V O R M N YA N D U : Ye s C h a ir. CHAIRPERSON: Okay thank you. M R T H O B A N I T R E V O R M N YA N D U : C h a i r w e ’ d n o w lik e t o t a k e y o u to p a r a g r a p h 2 .1 a t p a g e 9 0 3 9 . ADV MAHLAPE SELLO: 39 or 37 Mr Mnyandu? M R T H O B A N I T R E V O R M N YA N D U : P a r a g r a p h 2 . 2 1 … ( i n te r v e n t io n ) . 20 A D V M A H L A P E S E L L O : O h 2 1 I th o u g h t 2 . 1 y e s 2 . 2 1 is a t 9 0 3 9 . M R T H O B A N I T R E V O R M N YA N D U : Ye s , C h a ir, a t t h i s p o i n t t h e l e t t e r h a s a lr e a d y s e t- o u t t h e b a c k g r o u n d in r e l a ti o n t o C N R n o w k n o w n a s C R R C R o ll i n g S t o c k a n d B E X a n d h o w t h e y b e c a m e a b o u t t o fo r m t h e r e l a ti o n s h i p . Th is d e a l s w i t h t h e p e r s p e c ti v e o f C N R i n r e la t io n t o t h e r e l o c a ti o n c o s ts . Br ie f ly, p a r a g r a p h 2 . 2 1 r e a d s , Page 42 of 116 30 MAY 2019 – DAY 102 “ O u r c l ie n t w a s o f th e v i e w a t t h e t i m e , t h a t Tr a n s n e t w o u ld n o t a g r e e to a p r o j e c t c o s t o f 5 8 0 m i ll io n r a n d a n d t h a t t h e f i n a l p r o j e c t c o s t m i g h t b e lo w e r th a n t h i s . B a s e d o n o u r c l ie n t ’s p r i o r b u s i n e s s t h a t o u r c l ie n t b e li e v e t h a t Tr a n s n e t w il l r e q u ir e a d is c o u n t o n th is a m o u n t , t h u s o u r c l ie n t b e l i e v e d t h a t t h e fi n a l p r o j e c t c o s t w il l b e c l o s e r to 5 8 0 m i ll i o n r a n d . H e n c e th e y b e li e v e d t h e r e w a s v e r y li t t le r i s k f o r t h e i n a g r e e i n g in a n u p s id e f e e a r r a n g e m e n t w i th B E X ” , I t is ju s t t h a t n o t e t h a t w e n e e d e d t o t a k e t h e C h a ir to . 10 A D V M A H L A P E S E L L O : B e fo r e y o u l e a v e t h a t n o t e , t h i s is – t h is le t t e r is f r o m t h e a t t o r n e y s a n d i t i s a d v a n c i n g C N R c o n s o r t iu m p o s i ti o n . M R T H O B A N I T R E V O R M N YA N D U : Ye s C h a ir. A D V M A H L A P E S E L L O : W h e r e it s e e k s t o j u s t if y t h e c o n c l u s i o n o f t h e a g r e e m e n t f o r s e r v ic e s w i t h B E X . M R T H O B A N I T R E V O R M N YA N D U : Ye s C h a ir. ADV MAHLAPE SELLO: A n d a t p a r a g r a p h 2 . 2 1 t h a t y o u ’v e ju s t r e fe r r e d u s t o a t p a g e 9 0 9 3 , th e l e t t e r i n f o r m s u s t h a t, i n t r u t h , C N R b e li e v e d , p r e s u m a b ly o n t h e b a s is o f s o m e c a l c u la t io n t h a t t h e a c tu a l c o s t o f r e lo c a t io n w o u ld b e 5 8 0 . 20 M R T H O B A N I T R E V O R M N YA N D U : Ye s C h a ir. A D V M A H L A P E S E L L O : B u t w e k n o w t h a t ’s n o t w h a t C N R c l a i m e d a s a r e l o c a ti o n c o s t . M R T H O B A N I T R E V O R M N YA N D U : I n d e e d . A D V M A H L A P E S E L L O : A n d t h e y d id t h i s k n o w in g th a t th e a c tu a l c o s t is 5 8 0 i f i t i s t h e a c t u a l c o s t . Page 43 of 116 30 MAY 2019 – DAY 102 M R T H O B A N I T R E V O R M N YA N D U : I n d e e d C h a ir. ADV MAHLAPE SELLO: Thank you, yes you may proceed. M R TH O B A N I T R E V O R M N YA N D U : T h a n k y o u C h a ir. A t s li d e n u m b e r 1 3 w e m a k e t h e p o i n t a s m a d e in o u r r e p o r t t h a t t h e a g r e e m e n t w a s b a s e d o n a r i s k s h a r i n g m o d e l w h i c h w e ’ v e a lr e a d y d e a l t w i th , th a t w e n o t e t o b e v e r y s u s p ic i o u s f o r t h e r e a s o n s a lr e a d y o u t li n e d t o t h e C h a ir. F u r th e r m o r e , w e ’ d lik e t o p o i n t o u t t h a t t h e a g r e e m e n t is a ls o s u s p i c i o u s o n th e f a c t – b a s e d o n t h e f a c t t h a t t h e C h a ir w il l r e c a l l th a t e v i d e n c e w a s l e d b y M r S e d u m e d i t h a t C N R , a s a c o n s o r ti u m , h a d 10 p l a c e d i n o r s u b m it t e d a b i d o r p r o p o s a l f o r t h e m a n u f a c t u r in g o f b o th e l e c tr ic a s w e ll a s d ie s e l l o c o m o ti v e s . C h a ir fr o m o u r p e r s p e c ti v e i t is t h e r e f o r e u n f a th o m a b l e t h a t t h e r e w o u ld b e a n O E M t h a t w o u l d r e q u ir e t h e a s s is t a n c e o f a t h ir d p a r t y i n o r d e r t o c o m p u te t h e p r ic e d i ff e r e n c e o f i t b e i n g l o c a te d i n o n e p l a c e a s o p p o s e d to t h e o t h e r. ADV MAHLAPE SELLO: A n d in b id d i n g f o r b o t h d ie s e l a n d e l e c tr ic e ffe c tiv e l y, t h e y b i d f o r 1 0 6 4 l o c o m o ti v e s . M R T H O B A N I T R E V O R M N YA N D U : I n d e e d i t is s o C h a ir. A D V M A H L A P E S E L L O : Ye s . M R T H O B A N I T R E V O R M N YA N D U : W e t h e n m o v e o n t o th e n e x t s l id e . 20 A D V M A H L A P E S E L L O : Ye s . M R T H O B A N I T R E V O R M N YA N D U : C h a i r o n 1 9 M a y 2 0 1 5 , t h e r e is a m e m o r a n d u m t h a t is p r e p a r e d b y Ms M d l e ts h e , M s L i n d i w e M d l e t s h e in w h ic h s h e s o u g h t a p p r o v a l f r o m t h e , t h e n a c ti n g G r o u p C h i e f E x e c u t iv e , M r S iy a b o n g a G a m a f o r t h e n e g o ti a ti o n o f t h e te r ms o f th e r e lo c a t io n with CNR. Page 44 of 116 30 MAY 2019 – DAY 102 A D V M A H L A P E S E L L O : Ye s . M R T H O B A N I T R E V O R M N YA N D U : W h il s t t h e m e m o r a n d u m n o t e s t h a t a s e p a r a t e s u b m is s i o n is t o b e m a d e o r h a s b e e n p r e p a r e d f o r B T w e h a v e n o t d is c o v e r e d s u c h a m e m o r a n d u m b u t fr o m t h e p r o c e s s e s th a t e n s u e d a r is i n g h is m e m o r a n d u m , w e a r e i n d e e d a b l e t o c o n fir m t h a t B T w a s c o m m u n ic a t e d w i th t o th e s a m e e ffe c t . C h a ir w e s e e k t o t a k e y o u through the genesis or the purpose of the memorandum, the purpose of t h e m e m o w a s to s e e k a p p r o v a l f o r th e f o l lo w in g , 1 ) fo r t h e te a m t o n e g o ti a te t h e c o m m e r c i a l te r ms o f r e l o c a ti o n … ( in t e r v e n ti o n ) . 10 C H A I R P E R S O N : I’ m s o r r y th e m e m o r a n d u m is a t w h a t p a g e ? M R T H O B A N I T R E V O R M N YA N D U : C h a i r it is t o b e f o u n d a t v o lu m e 1 3 a t p a g e 9 11 0 . A D V M A H L A P E S E L L O : T h e a c tu a l d o c u m e n t s t a r ti n g a t 9 111 . CHAIRPERSON: I t h i n k t h e a p p e a r a n c e o f A p p e n d ix b e f o r e t h e v o l u m e … ( in t e r v e n ti o n ) . A D V M A H L A P E S E L L O : Is c o n fu s i n g a b i t . CHAIRPERSON: I t’s c o n f u s in g b e c a u s e I’ m u s e d t o t h e s e b u n d l e s s t a r ti n g w i th a v o l u m e . A D V M A H L A P E S E L L O : I n d e e d C h a ir. 20 C H A I R P E R S O N : S o I t a k e ti m e t o – I k i n d o f m is s t h e m . ADV MAHLAPE SELLO: W e s h a ll a m e n d , C h a ir, y o u r c o p y a n d r e m o v e r e f e r e n c e s to a p p e n d ix a n d ju s t g iv e d ir e c t r e f e r e n c e t o t h e v o l u m e a n d t h e p a g e n u m b e r. C H A I R P E R S O N : I m e a n I a p p r e c ia t e th a t h a v i n g a p p e n d ix ( i n d i s t i n c t) m i g h t b e h e l p fu l b u t … ( i n te r v e n ti o n ) . Page 45 of 116 30 MAY 2019 – DAY 102 ADV MAHLAPE SELLO: It perhaps may come at the end of the…(intervention) CHAIRPERSON: Maybe it can come at the end. A D V M A H L A P E S E L L O : N o t a t th e b e g i n n in g , y e s C h a i r C H A I R P E R S O N : I’l l fi n d t h i s p a g e ju s t n o w. ADV MAHLAPE SELLO: CHAIRPERSON: 9 111 C h a ir. Thank you. A D V M A H L A P E S E L L O : T h a n k y o u C h a ir. M R T H O B A N I T R E V O R M N YA N D U : 10 C h a i r w e s u m m a r is e a s I’ v e s a i d t h a t th e p u r p o s e o f t h e m e m o w a s to s e e k a p p r o v a l fo r t h e t e a m t o n e g o ti a te t h e r e lo c a t io n to D u r b a n w i th C N R . T h e b a c k g r o u n d s p e a k s t o t h e is s u e s t h a t w e ’ v e a lr e a d y c o v e r e d a n d n e e d s n o t t o b e c o v e r e d f o r y o u C h a ir … ( i n te r v e n t io n ) . ADV MAHLAPE SELLO: M r M n y a n d u p l e a s e p u l l t h e m i c – s w in g i t towards you yes. M R T H O B A N I T R E V O R M N YA N D U : A p o l o g i e s C h a ir. A D V M A H L A P E S E L L O : Ye s t h a n k y o u . M R T H O B A N I T R E V O R M N YA N D U : I f w e g o to p a r a g r a p h 6 u n d e r b a c k g r o u n d C h a ir i t s a y s , 20 “ A t e a m w il l b e … ( i n t e r v e n t i o n ) . CHAIRPERSON: I’m sorry before you go to paragraph 6, at some stage it w o u l d h e l p i f y o u c o u l d j u s t t e ll m e , w h e r e d o w e f in d t h e fi r s t u s e o f t h is t e r m , r e l o c a ti o n a n d b y w h o m , i f y o u r i n v e s t ig a ti o n h e l p e d y o u t o e s t a b li s h th a t b u t i t d o e s n ’ t h a v e t o b e n o w, l a te r, b u t i f y o u w e r e n o t a b l e t o d is c o v e r t h a t y o u w il l j u s t l e t m e k n o w. Page 46 of 116 30 MAY 2019 – DAY 102 M R T H O B A N I T R E V O R M N YA N D U : A lr ig h t C h a ir. C H A I R P E R S O N : O k a y. M R T H O B A N I T R E V O R M N YA N D U : C h a ir i f w e g o t o t h e p u r p o s e it i s A) the team, “ To s e e k a p p r o v a l f o r t h e t e a m t o n e g o t i a te t h e r e lo c a t io n t o Durban with CNR. B ) S e e k a p p r o v a l fo r a v a r i a t i o n o r d e r t o fi n a l is e th e r e lo c a t io n o f t h e p r o g r a m m e o f t h e c o n s t r u c t i o n o f 2 3 3 c la s s 4 5 D l o c o m o t iv e s to D u r b a n t o a m a x i m u m v a l u e o f R 6 6 9 7 8 4 2 8 6 .0 0 S e p a r a t e s u b m i s s i o n h a s b e e n 10 prepared f o r B T, w e k n o w t h a t th e r e is a t y p o a t B i n s o fa r a s i t r e f e r s t o 2 3 3 l o c o m o ti v e s i t o u g h t to b e 2 3 2 . C) it is also to seek a p p r o v a l f o r a l e t te r t o b e is s u e d t o C N R t o c o m m e n c e n e g o ti a ti o n f o r th is r e l o c a ti o n o f t h e p r o g r a m m e ” . A D V M A H L A P E S E L L O : O k a y. M R T H O B A N I T R E V O R M N YA N D U : F o r t h e s e p u r p o s e s C h a ir w e ’d j u s t lik e t o d r a w y o u r a t t e n ti o n t o t h e c a p o f 6 6 9 m il li o n r a n d th a t is requested. W e f o u n d it o d d t h a t a Tr a n s n e t o ff ic i a l, i n t e r n a l ly w o u ld r e q u e s t f o r a c a p a t 6 6 9 m il li o n r a n d . U p o n i n v e s t ig a ti n g t h e is s u e , t h e a m o u n t r e s e m b l e s e x a c t ly w h a t is t o b e f o u n d a t p a g e 4 2 , b u t th e C h a ir 20 n e e d n o t g o th e r e n o w a t p a g e 4 2 o f t h e E x h i b i t B u n d l e t h a t i s b e f o r e t h e C h a ir. S o it i s th e l a te s t p r o p o s a l t h a t h a d b e e n r e c e i v e d fr o m C N R e v e n th o u g h i t is d a te d J u n e 2 0 1 5 , i t c o i n c i d e s , a s I s a y th e a m o u n t c o i n c i d e s w i th t h e m e m o d o n e b y M s L in d i w e M d l e ts h e , i f w e g o t o t h e b o t t o m … ( in t e r v e n t i o n ) . ADV MAHLAPE SELLO: B e fo r e y o u l e a v e t h a t p o in t , y o u s a y th e Page 47 of 116 30 MAY 2019 – DAY 102 6 6 9 m i lli o n o d d e m a n a te s f r o m a p r o p o s a l b y C N R ? M R T H O B A N I T R E V O R M N YA N D U : I n d e e d C h a ir. ADV MAHLAPE SELLO: A n d y o u r e fe r r e d t h e C h a ir t o t h e d o c u m e n t a n d y o u s a i d i t ’s n o t n e c e s s a r y r e a ll y t o g o th e r e a t t h e m o m e n t . M R T H O B A N I T R E V O R M N YA N D U : A t t h e m o m e n t . A D V M A H LA P E S E L L O : A n d y o u s a y t h a t d o c u m e n t is d a t e d J u n e 2015. M R T H O B A N I T R E V O R M N YA N D U : I n d e e d C h a ir. A D V M A H L A P E S E L L O : P l e a s e r e f e r to p a g e 9 11 5 o f th e m e m o t o M r 10 G a m a … ( i n t e r v e n t io n ) . CHAIRPERSON: Maybe before that this amount of 669 784 286.00 that is d e a lt w i t h u n d e r p u r p o s e , d o e s i t l o o k li k e s o m e b o d y, f o r Tr a n s n e t m a y h a v e r e c e i v e d th e p r o p o s a l f r o m C N R a n d h a d j u s t t a k e n t h a t a m o u n t a s i s a n d s a i d t o G a m a t h a t’s w h a t w e s h o u l d t a lk a b o u t ? M R T H O B A N I T R E V O R M N YA N D U : I n d e e d i t l o o k s l ik e th a t C h a ir. C H A I R P E R S O N : Ye s w i th o u t a n y d is c u s s i o n fr o m w h a t y o u c o u l d f in d . M R T H O B A N I T R E V O R M N YA N D U : I t s e e m s th e r e w a s i n d e e d n o in t e r r o g a ti o n o f t h e a m o u n t . C H A I R P E R S O N : Ye s . 20 M R T H O B A N I T R E V O R M N YA N D U : It is a request to approve that a m o u n t a s a c e il in g f o r t h e n e g o t ia t io n s C h a ir. C H A I R P E R S O N : Ye s , y e s , o k a y t h a n k y o u . ADV MAHLAPE SELLO: A n d t h e o th e r – p le a s e g o t o 9 11 5 a n d f o ll o w i n g o n t h e q u e s t i o n t h a t t h e C h a i r h a s j u s t p o s e d t h a t , th a t n u m b e r a p p e a r s t o b e u p li f te d d ir e c t ly f r o m C N R p r o p o s a l i n to t h is Page 48 of 116 30 MAY 2019 – DAY 102 memorandum. Yo u t e s t if i e d t h a t , th a t p r o p o s a l i s d a te d J u n e 2 0 1 5 . M R T H O B A N I T R E V O R M N YA N D U : I n d e e d C h a ir. A D V M A H L A P E S E L L O : B u t t h is m e m o r a n d u m i s d a te d 1 9 M a y 2 0 1 5 . M R T H O B A N I T R E V O R M N YA N D U : I n d e e d C h a ir. A D V M A H LA P E S E L L O : So the number was known somewhere, s o m e h o w t o s o m e b o d y w it h in Tr a n s n e t b e f o r e t h e a c t u a l p r o p o s a l w a s received? M R T H O B A N I T R E V O R M N YA N D U : I n d e e d C h a ir. ADV MAHLAPE SELLO: 10 D o y o u k n o w h o w t h a t c a m e t o b e o r is t h a t a s k in g t o o m u c h ? MR THOBANI TREVOR M N YA N D U : During th e course of our in v e s t i g a t io n s w e w e r e n ’ t a b l e to d e te r m i n e . ADV MAHLAPE SELLO: Thank you. M R T H O B A N I T R E V O R M N YA N D U : B u t i t is t o b e n o te d C h a ir t h a t t h e p a r t ic u l a r m e m o r a n d u m a c t u a l ly c o n t a in s t w o s i g n a t u r e p a g e s b e c a u s e if t h e C h a ir g o e s to 9 11 4 , i t is w h e r e t h e a m o u n t a t th e t o p a t r e c o m m e n d a ti o n o f 6 6 9 is t o b e f o u n d b u t o n t h e p a g e a t w h i c h M r Gama signs the memorandum, the amount is d e n o te d as R 6 3 5 8 5 1 7 8 6 .0 0 20 A D V M A H L A P E S E L L O : O k a y. M R T H O B A N I T R E V O R M N YA N D U : E v e n t h a t a m o u n t c o m e s fr o m a p a r t ic u l a r p r o p o s a l s u b m i t te d o n b e h a lf o f C N R . A D V M A H L A P E S E L L O : Is t h a t … ( in t e r v e n ti o n ) . C H A I R P E R S O N : S o th e p a g e 9 11 4 a n d p a g e 9 11 5 a r e t h e s e p a g e s tw o p a g e s o f d i ff e r e n t d o c u m e n ts o r – I s e e t h e y b o t h s a y r e c o m m e n d a ti o n Page 49 of 116 30 MAY 2019 – DAY 102 a t th e t o p a n d t h e n s a y c o m p i l e d b y, t h e y d o n ’ t – th e y ’r e c o m p il e d b y L i n d i w e M d l e t s h e b o t h o f th e m b u t t h e s ig n a tu r e o n t o p o f L i n d i w e M d le t s h e ’s n a m e , th e s ig n a t u r e s a r e d i ff e r e n t o n th e tw o d o c u m e n ts a n d t h e – o r d o e s i t l o o k l ik e i t ’s o n e p e r s o n w h o s ig n e d f o r L i n d i w e M d le t s h e , Ravi N a ir and P e te r Se li n g a , what was h a p p e n in g … ( i n t e r v e n t io n ) . M R T H O B A N I T R E V O R M N YA N D U : S o r r y t o d is tu r b ju s t t o c o n f ir m . C H A I R P E R S O N : Ye s . M R T H O B A N I T R E V O R M N YA N D U : 10 T h e r e a d in g th a t y o u s e e o n t h e s ig n a tu r e li n e s o f M s L i n d iw e M d l e t s h e , M r R a v i N a i r a s w e ll M r S e li n g a s a y, s e e a t t a c h e d . C H A I R P E R S O N : O h t h e y s a y, s e e a t ta c h e d , t h e y a r e n o t s i g n a t u r e s . M R T H O B A N I T R E V O R M N YA N D U : I n d e e d C h a ir. C H A I R P E R S O N : O k a y. M R TH O B A N I T R E V O R M N YA N D U : The signatures are on the next page. CHAIRPERSON: B u t th e n Mr A n o j Si n g h ’s s ig n a t u r e is t h e r e a n d Mr G a m a ’s s i g n a t u r e is t h e r e o n p a g e 9 11 4 a n d th e y a r e r e p e a te d a t p a g e 9 11 5 , w h a t is th e m e a n i n g o f th is ? 20 M R T H O B A N I T R E V O R M N YA N D U : C h a ir w e w e r e n o t a b l e t o d e t e r m i n e M s L in d iw e M d le t s h e h e r s e l f , w h e n in t e r v ie w e d c o u l d n o t e x p l a i n a s to w h y th e r e w e r e tw o s ig n a tu r e p a g e s . CHAIRPERSON: Ye s th e m o s t s e n i o r – w a s t h e m o s t s e n i o r o f a ll t h e s e p e o p le , w e l l i t w a s M r G a m a a s o f t h is t i m e , h e w a s a c t in g G r o u p C h i e f E x e c u tiv e . Page 50 of 116 30 MAY 2019 – DAY 102 M R T H O B A N I T R E V O R M N YA N D U : I n d e e d C h a ir a n d t h e a p p r o v a l w a s s o u g h t fr o m h i m . CHAIRPERSON: A n d t o t h e e x t e n t t h a t h e s i g n e d t w o p a g e s th a t c o n ta in e d th e s a m e th i n g in t e r m s o f t h e r e c o m m e n d a ti o n e x c e p t fo r t h e fi g u r e a t 9 11 4 i t’s o n e a m o u n t , a t 9 11 5 i t ’s a d i ffe r e n t a m o u n t , h e a p p r o v e d t w o d i ff e r e n t a m o u n ts f o r t h e s a m e t h i n g , is th a t r i g h t? M R T H O B A N I T R E V O R M N YA N D U : Ye s C h a ir. C H A I R P E R S O N : O k a y. MR 10 THOBANI TREVOR M N YA N D U : The u n d e r s ta n d i n g as we u n d e r s t o o d i t fr o m o u r i n t e r v ie w w a s t h a t t h e o n e th a t w a s a c tu a lly a p p r o v e d i s th e la t e r p r o p o s a l w h ic h i s t h e o n e , a s I s a y, d a t e d J u n e 2 0 1 5 a n d i t c o n t a i n s t h e a m o u n t o f 6 6 9 m il l io n r a n d . CHAIRPERSON: A n d h o w d i d t h e o t h e r o n e c o m e a b o u t , y o u d o n ’t know? M R T H O B A N I T R E V O R M N YA N D U : I t w a s e a r l ie r, i t h a d b e e n s u b m i tt e d e a r li e r b y C N R . CHAIRPERSON: B u t t h is d o c u m e n t t h a t w e a r e l o o k i n g a t w h ic h h a s g o t t h e s e t w o p a g e s 9 9 1 4 a n d 9 11 5 … ( i n t e r v e n ti o n ) . M R T H O B A N I T R E V O R M N YA N D U : 20 I a p o l o g is e C h a ir, p e r h a p s w e s h o u l d h a v e p o i n te d o u t, i f y o u l o o k a t t h e p a g e 9 11 4 , i t s i g n e d d u r i n g the month of June. CHAIRPERSON: 2015. M R T H O B A N I T R E V O R M N YA N D U : 2 0 1 5 , 9 J u n e . A D V M A H L A P E S E L L O : Ye s . M R T H O B A N I T R E V O R M N YA N D U : S o it i s a p p r o v e d b y Mr G a m a Page 51 of 116 30 MAY 2019 – DAY 102 b a s e d o n t h e la t e r p r o p o s a l r e c e iv e d in J u n e . C H A I R P E R S O N : Ye s . M R T H O B A N I T R E V O R M N YA N D U : Ye s C h a ir. C H A I R P E R S O N : A n d t h e n th e d o c u m e n t – t h e n 9 11 5 t h e r e i s n o d a te a p p e a r i n g n e x t t o M r G a m a ’s s i g n a t u r e t o i n d ic a te w h e n h e s ig n e d i t b u t S e l i n g a , I d o n ’ t k n o w i f i t ’s M s o r M r S ip h iw e S e l in g a h e o r s h e s ig n e d o n 1 9 M a y 2 0 1 5 a n d M r L in d i w e M d le t s h e s i g n e d o n t h e s a m e d a y, I ’ m n o t s e e i n g …( i n t e r v e n ti o n ) . M R T H O B A N I T R E V O R M N YA N D U : T h e r e is n o d a t e . 10 A D V M A H L A P E S E L L O : I t l o o k s lik e – is i t 1 9 … ( i n t e r v e n t io n ) . M R T H O B A N I T R E V O R M N YA N D U : I t l o o k s lik e 1 9 M a y 2 0 1 5 C h a ir. CHAIRPERSON: 2 0 1 5 , S o t h e d o c u m e n t – M r G a m a ’s a p p r o v a l o n p a g e 9 11 4 is l a t e r t h a n t h e a p p r o v a ls o n 9 11 5 . M R T H O B A N I T R E V O R M N YA N D U : I n d e e d C h a ir. CHAIRPERSON: So – but then only he approved that on that page and M r S i n g h o n 9 11 4 to th e e x t e n t t h a t th e i r s i g n a t u r e s a r e g o o d e n o u g h f o r th e a p p r o v a l , t h a t w o u l d b e th e a m o u n t t h a t m u s t b e s e e n a s h a v i n g been approved. M R T H O B A N I T R E V O R M N YA N D U : I n d e e d C h a ir. 20 C H A I R P E R S O N : A n d r e p l a c in g th is o th e r o n e , a t p a g e 9 11 5 . M R T H O B A N I T R E V O R M N YA N D U : CHAIRPERSON: In d e e d C h a ir. I s e e t h a t s o m e b o d y w r o t e a t 9 11 5 t h a t – I t h i n k m a y b e M r G a m a h e n e e d s c l a r i ty o n c e r ta i n t h i n g s s o m a y b e th a t ’s w h y t h e r e ’s th e o n e o n p a g e 9 11 4 b e c a u s e h e n e e d e d t o h a v e s o m e c l a r i t y b u t I w o n d e r w h y h e s i g n e d b e f o r e g e tt i n g t h e c l a r i ty. Page 52 of 116 30 MAY 2019 – DAY 102 M R T H O B A N I T R E V O R M N YA N D U : I n d e e d C h a ir it ’s a m y s t e r y. C H A I R P E R S O N : J a o k a y, t h a n k y o u . A D V M A H L A P E S E L L O : I’ m s ti ll tr y i n g to r e c o n c i l e 9 11 4 w i th 9 11 5 . I f o n e l o o k s a t 9 11 4 i t’s s e e k i n g a p p r o v a l f o r a n a m o u n t o f 6 6 9 mi ll i o n . M R T H O B A N I T R E V O R M N YA N D U : Ye s C h a ir. A D V M A H LA P E S E L L O : I t s a y s c o m p il e d a n d ty p e d , L i n d i w e M d le t s h e , o n t h e s i g n a t u r e li n e it ’s n o t h e r s i g n a t u r e i t’s w r i tt e n s e e a tt a c h e d . M R T H O B A N I T R E V O R M N YA N D U : S e e a t t a c h e d . 10 ADV MAHLAPE SELLO: For Mr Ravi Nair? M R T H O B A N I T R E V O R M N YA N D U : R a v i N a ir. A D V M A H L A P E S E L L O : T h e s a m e th i n g a p p li e s , i t s a y s s e e a t ta c h e d . M R T H O B A N I T R E V O R M N YA N D U : I n d e e d C h a ir. A D V M A H L A P E S E L L O : S o d o e s M r S e li n g a s a y, Mr A n o j S i n g h s i g n s o n w h a t a p p e a r s t o b e 2 8 t h M a y 2 0 1 5 a n d M r G a m a s ig n s o n t h e 9 t h o f June 2015. M R T H O B A N I T R E V O R M N YA N D U : Ye s C h a ir. ADV MAHLAPE SELLO: W h a t is th e a tt a c h e d t h a t w e a r e b e in g r e fe r r e d t o ? 20 M R T H O B A N I T R E V O R M N YA N D U : A g a i n th r o u g h o u r in t e r v i e w s w e d is c o v e r e d t h a t w h a t is a tt a c h e d is – w h a t i s d e n o t e d b y th e s e e a tt a c h e d , m y r e c o m m e n d a ti o n o f th e m e m o r a n d u m h a s a l r e a d y b e e n s ig n e d f o r, s e e a t ta c h e d . ADV MAHLAPE SELLO: O k a y n o w w il l th e s e e a t t a c h e d b e w h a t a p p e a r s a t 9 11 5 ? Page 53 of 116 30 MAY 2019 – DAY 102 M R T H O B A N I T R E V O R M N YA N D U : I n d e e d i t is s o C h a ir. A D V M A H L A P E S E L L O : S o 9 11 5 w o u ld a p p e a r t o b e t h e la s t p a g e o f a memorandum. M R T H O B A N I T R E V O R M N YA N D U : I n d e e d C h a ir. A D V M A H L A P E S E L L O : I f w e w e r e t o f o l l o w t h e s tr u c t u r e o f A p p e n d ix 10. M R T H O B A N I T R E V O R M N YA N D U : I n d e e d C h a ir. A D V M A H L A P E S E L L O : A n d y e s Ms L i n d i w e M d l e t s h e s ig n e d t h e r e o n t h e 1 9 t h o f M a y 2 0 1 5 , e x c e p t w h e n I l o o k a t t h e r e c o m m e n d a t io n i t is 10 n o w f o r 6 3 5 m il li o n . M R T H O B A N I T R E V O R M N YA N D U : Ye s in d e e d C h a ir. ADV MAHLAPE SELLO: S o w o u ld m y lo g ic b e c o r r e c t if I s a y, p a g e 9 11 5 i s th e f in a l p a g e o f a – a n o t h e r m e m o a n d n o t A p p e n d i x 1 0 , t h e r e ’s a n o t h e r m e m o t h a t a r g u e d f o r a p p r o v a l o f 6 3 5 mi ll i o n . M R T H O B A N I TR E V O R M N YA N D U : C h a ir o n t h e b a s is th a t t h e fr o n t o f A p p e n d i x 1 0 … ( i n te r v e n t io n ) . A D V M A H L A P E S E L L O : P r e c i s e ly b e c a u s e t h a t fr o n t s p e a k s o f 6 6 9 . M R T H O B A N I T R E V O R M N YA N D U : Ye s . ADV MAHLAPE SELLO: 20 S o t h e r e m u s t b e a n o th e r m e m o t h a t s p e a k s of 635. M R T H O B A N I T R E V O R M N YA N D U : A D V M A H LA P E S E L L O : Ye s C h a ir. W h i c h i s n o t a n n e x e d h e r e o r a t ta c h e d b u t o n ly t h e s i g n e d r e c o m m e n d a t io n p a g e is a n n e x e d . M R T H O B A N I T R E V O R M N YA N D U : Ye s it is s o C h a ir. A D V M A H L A P E S E L L O : O k a y. Page 54 of 116 30 MAY 2019 – DAY 102 CHAIRPERSON: I’ m n o t s u r e t h a t I h a v e fo ll o w e d y o u r e x c h a n g e b u t le t m e a s k t h is . I t s e e m s – i t s e e ms – i t w o u ld s e e m i l lo g i c a l o r m a y b e ill o g i c a l is n o t t h e r i g h t w o r d b u t i t m a y b e i t w o u l d b e s t r a n g e i f th e , s e e a t ta c h e d , a t 9 11 4 w a s m a d e w i t h t h e in t e n t io n o f r e f e r r i n g to 9 11 5 b e c a u s e , s e e a t t a c h e d , a b o v e Mr M d le t s h e ’s s i g n a t u r e li n e a n d M r N a i r ’s s i g n a t u r e l in e fr o m w h a t y o u s a i d e a r l ie r o n , i n t h a t e v e n t c o l d o n ly m e a n , I h a v e a l r e a d y s ig n e d . M R T H O B A N I TR E V O R M N YA N D U : I n d e e d t h a t is w h a t is t o b e u n d e r s t o o d C h a ir. 10 CHAIRPERSON: Ye s b u t t h e p r o b l e m w i t h t h a t u n d e r s t a n d i n g o f , s e e a tt a c h e d , is th e tw o p a g e s c o u l d n o t h a v e b o t h b e e n m e a n t to b e u s e d . M R T H O B A N I T R E V O R M N YA N D U : Pr i n c i p a l ly C h a ir b e c a u s e t h e y r e fe r t o d i ff e r e n t n u m b e r s , t h a t t h e r e is a r e q u e s t fo r a p p r o v a l o n . CHAIRPERSON: Ye s so th a t is th e one problem w it h that u n d e r s t a n d in g , t h e o t h e r p r o b l e m is i f – i s th a t i t w o u l d b e s o e a s y t o s ig n th e r e u n l e s s t h e i d e a w a s t h a t M d l e ts h e – M s M d l e ts h e a n d M a r N a ir w e r e n o t a v a il a b l e , I d o n ’ t k n o w b u t i t j u s t m a k e s i t v e r y d i ff ic u l t t o u n d e r s t a n d p r e c is e ly w h a t w a s b e i n g r e c o m m e n d e d b y w h o a n d w h a t was being approved by Mr Gama. 20 M R T H O B A N I T R E V O R M N YA N D U : E v e n m o r e s o C h a ir w h e n o n e c o n s i d e r s t h a t t h e s i g n a t u r e li n e s w i th t h e , s e e a t ta c h e d , a b o v e th e n a m e s o f t h e p e r s o n n e l a t Tr a n s n e t t h a t w o u l d ta k e th e m e m o r a n d u m t o M r G a m a , y e s C h a ir. C H A I R P E R S O N : Ye s , y e s . M R T H O B A N I T R E V O R M N YA N D U : A s I s a y, d u r i n g t h e c o u r s e o f o u r Page 55 of 116 30 MAY 2019 – DAY 102 in v e s t i g a t io n s a n d in t e r v ie w s th e r e w a s n o d ir e c t a n s w e r i n r e l a ti o n t o w h y t h is m e m o r a n d u m w a s d o n e i n th is m a n n e r. CHAIRPERSON: B u t w h e n y o u f o u n d t h is d o c u m e n t , d i d y o u f in d i t w i t h t h e s e tw o p a g e s a s p a r t o f t h e d o c u m e n t ? M R T H O B A N I T R E V O R M N YA N D U : I n d e e d C h a ir. CHAIRPERSON: Ye s . M R T H O B A N I T R E V O R M N YA N D U : O n fir s t i n v e s t ig a ti o n w e w e r e o f t h e v ie w t h a t p e r h a p s t h e o n e r e l a t e d to B T w h o a t t h e t i m e h a d a q u o t a t i o n v e r y c l o s e t o th e n u m b e r w h ic h is 6 3 5 m il li o n b u t w e l a te r 10 d is c o v e r e d th a t th e r e w a s a p r o p o s a l fr o m C N R t o t h e e ff e c t o f R 6 3 5 8 5 1 0 0 0 .0 0 m o r e o v e r, a s w e s a y, t h e l a s t l e t te r, w h ic h is C , u n d e r r e c o m m e n d a ti o n s , i t s a y s , l e tt e r t o b e i s s u e d t o C N R to c o m m e n c e n e g o ti a ti o n , s o t o o d o e s 9 11 4 r e a d , l e t t e r t o b e i s s u e d to C N R . C H A I R P E R S O N : Ye b u t y o u s a y y o u r te a m d i d s p e a k t o M s M d le t s h e ? M R T H O B A N I T R E V O R M N YA N D U : Ye s C h a ir. C H A I R P E R S O N : A n d y o u p u t th is to h e r. M R T H O B A N I T R E V O R M N YA N D U : Ye s C h a ir. C H A I R P E R S O N : A n d y o u s a y s h e c o u ld n o t e x p la in i t? M R TH O B A N I T R E V O R M N YA N D U : 20 O n m a n y q u e s t io n s s h e c o u l d n o t e x p l a i n th e s e q u e n c e o f e v e n t s , n o r w h a t l e d t o p a r t ic u l a r d e c i s i o n s that she took. CHAIRPERSON: A n d w h a t d i d s h e a tt r i b u te t h a t to , d id s h e s a y s h e h a d fo r g o t te n , s h e c o u ld n ’ t r e m e m b e r o r s h e ju s t s ta r e d a t y o u ? M R T H O B A N I T R E V O R M N YA N D U : C h a ir in c e r t a i n i n s ta n c e s s h e c o u l d n ’ t r e m e m b e r b u t I s h o u l d p l a c e o n r e c o r d t h a t t h e i n t e r v ie w w i t h Page 56 of 116 30 MAY 2019 – DAY 102 h e r w a s r a th e r a b r a s i v e . C H A I R P E R S O N : W a s s h e h o s t il e ? M R T H O B A N I T R E V O R M N YA N D U : I n a m a n n e r y e s C h a ir. C H A I R P E R S O N : Ye s t h a t i n t e r v i e w w a s n ’ t r e c o r d e d b y … ( i n te r v e n t io n ) . M R T H O B A N I T R E V O R M N YA N D U : I t i s t r a n s c r i b e d C h a ir, i t is p a r t o f t h e tr a n s c r ip t s t h a t w il l b e d e l iv e r e d . C H A I R P E R S O N : Ye s o k a y a n d w h a t a b o u t M r G a m a a n d M r A n o j S in g h t h e y h a d l e f t Tr a n s n e t b y t h e ti m e y o u h a d t h is c h a n c e o r d i d y o u g e t a c h a n c e t o p u t th is to t h e m a n d h e a r w h a t t h e y h a d t o s a y ? 10 M R T H O B A N I T R E V O R M N YA N D U : C h a ir w e d i d n ’ t – w e d i d g e t a c h a n c e to s p e a k t o M r G a m a , w e d id n ’t p u t t h i s p a r t ic u l a r m e m o r a n d u m t o h i m a t t h e t i m e , a t t h e ti m e w e w e r e i n v e s ti g a ti n g t h e l a r g e p a r t o f t h e 1 0 6 4 l o c o m o ti v e s tr a n s a c ti o n w h i c h w a s t h e p r o c u r e m e n t p r o c e s s f o ll o w e d . W h i ls t w e d id t o u c h b r i e f ly o n t h e is s u e o f r e lo c a t io n th is p a r t ic u l a r m e m o r a n d u m w a s n o t p u t t o h i m . CHAIRPERSON: And Mr Anoj Singh? M R T H O B A N I T R E V O R M N YA N D U : H e h a d l e ft Tr a n s n e t . CHAIRPERSON: Oh, okay thank you. ADV MAHLAPE SELLO: 20 A n d t h e n a t 9 11 4 a s w e p o i n te d o u t o n th e s ig n a tu r e l in e s o f M s L in d i w e M d le t s h e , Mr N a ir a n d M r S e li n g a r e s p e c ti v e ly i t ’s a m a n u s c r i p t w r i t te n , s e e a tt a c h e d , d i d y o u in v e s t i g a t e w h o w r o t e t h a t o n e a c h li n e ? M R T H O B A N I T R E V O R M N YA N D U : W h e n w e a s k e d Ms L i n d i w e M d le t s h e s h e d i d n ’ t h a v e a c lu e . ADV MAHLAPE SELLO: D id s h e s a y d e fi n i t e ly t h a t s h e d i d n o t , a t Page 57 of 116 30 MAY 2019 – DAY 102 le a s t i n s o f a r a s h e r n a m e is c o n c e r n e d , w r i t e , s e e a t ta c h e d , o n th is document? M R T H O B A N I T R E V O R M N YA N D U : D e fi n i t iv e ly, y e s . A D V M A H LA P E S E L L O : A n d s h e s a i d w h a t , d id s h e c l a i m t h a t s h e d o e s n ’t k n o w w h o w r o t e t h a t a n d u n d e r w h a t c ir c u m s t a n c e s ? M R T H O B A N I T R E V O R M N YA N D U : Ye s b u t s h e d i d o w n u p to c o m p il in g th e m e m o r a n d u m s . ADV MAHLAPE SELLO: S o t h e n s h e w o u l d b e a w a r e o f b o th m e m o r a n d u m s f o r C N R , fi r s tly fo r 6 3 5 a n d t h e n s u b s e q u e n tly fo r th is 10 669. M R T H O B A N I T R E V O R M N YA N D U : S o r r y th e m e m o r a n d u m – le t m e say the memorandum. A D V M A H L A P E S E L L O : T h is m e m o r a n d u m ? M R T H O B A N I T R E V O R M N YA N D U : Ye s . ADV MAHLAPE SELLO: Of 669? M R T H O B A N I T R E V O R M N YA N D U : O f 6 6 9 . ADV MAHLAPE SELLO: D i d y o u h a v e a d is c u s s i o n w i t h h e r a b o u t , s e e m in g ly a n o th e r m e m o r a n d u m f o r 6 3 5 ? M R T H O B A N I T R E V O R M N YA N D U : 20 F o r t h e p u r p o s e s o f o u r in t e r v ie w w e d id n ’t a t t a c k t h e – r a t h e r a s k t h e q u e s ti o n fr o m t h a t p e r s p e c tiv e b e c a u s e a s I s a y, a m o n g s t o t h e r th in g s , t h e i n te r v i e w w a s h o s ti le . A D V M A H L A P E S E L L O : A lr ig h t t h a n k y o u . C h a ir i t ’s j u s t b e e n b r o u g h t t o m y a tt e n ti o n , I a p o l o g i s e … ( in t e r v e n ti o n ) . C H A I R P E R S O N : T h a t ’s fi n e . A D V M A H L A P E S E L L O : T h a n k y o u C h a ir. Page 58 of 116 30 MAY 2019 – DAY 102 CHAIRPERSON: W e ’l l t a k e th e t e a a d j o u r n m e n t , i t’s h a l f p a s t n o w w e ’l l r e s u m e a t q u a r t e r to t w e lv e , w e a d j o u r n . INQUIRY ADJOURNS INQUIRY RESUMES C H A I R P E R S O N : Yo u m a y p r o c e e d Ms S e ll o . A D V M A H L A P E S E L L O : T h a n k y o u C h a ir. CHAIRPERSON: Thank you. A D V M A H LA P E S E L L O : Mr M n y a n d u w h e n w e r o s e fo r t e a w e w e r e s t il l tr y i n g t o m a k e s e n s e o f th e m e m o r a n d u m f o r th e a p p r o v a l o f 6 6 9 10 tr y i n g t o r e c o n c il e p a g e s 9 11 4 to 9 11 5 . T h e q u e r i e s I h a d i n r e s p e c t o f t h a t d o c u m e n t a r e a d d r e s s e d th a n k y o u . I d o n o t k n o w if t h e C h a ir h a s g o t a n y o th e r is s u e s a r is in g fr o m t h e d o c u m e n t o r w h e t h e r th e r e a r e o th e r c o m m e n t s y o u M r M n y a n d u w o u ld li k e to m a k e i n r e s p e c t o f th a t document before we move on. CHAIRPERSON: No we can move on. M R T H O B A N I T R E V O R M N YA N D U : N o t h e r e a r e n o t C h a ir. ADV MAHLAPE SELLO: Thank you. Then you may proceed. M R T H O B A N I T R E V O R M N YA N D U : C h a ir w e t h e n p r o c e e d t o s l id e number 15. 20 A D V M A H L A P E S E L L O : Ye s . M R T H O B A N I T R E V O R M N YA N D U : To – t o g iv e a n o v e r v ie w o f t h e t e a m c o m p o s it i o n a n d th e n d e a l w i t h w h a t t h e m a n d a te t h a t w a s s o u g h t f o r t h e t e a m w a s g o in g to b e . A D V M A H L A P E S E L L O : Ye s . M R T H O B A N I T R E V O R M N YA N D U : Th e t it l e s a r e t h e G r o u p C h i e f Page 59 of 116 30 MAY 2019 – DAY 102 Fi n a n c i a l O ff ic e r M r A n o j S in g h a t t h e t i m e . T h e C h i e f E x e c u t iv e o f Tr a n s n e t E n g in e e r in g Mr T h a m s a n q a J i y a n i. ADV MAHLAPE SELLO: Hm. M R T H O B A N I T R E V O R M N YA N D U : The Group Head of Supply Chain M a n a g e m e n t w h ic h w a s M r G a r r y P it a a s w e ll a s a r e p r e s e n ta t iv e fr o m t h e E x e c u t iv e L e g a l a n d C o m p li a n c e Mr S e li n g o . ADV MAHLAPE SELL O: I am sorry to interrupt you Mr Mnyandu I am lo o k in g a t t h e s c r e e n in f r o n t o f m e a n d I s e e m t o h a v e a d i ff e r e n t f e e d . I s e e m t o h a v e a – o k a y n o w i t is b a c k . I w a s ju s t c h e c k i n g th a t w e a r e 10 o n t h e r i g h t c o m p u te r. I t is s o r t e d y o u m a y p r o c e e d t h a n k y o u . M R TH O B A N I T R E V O R M N YA N D U : T h a n k y o u C h a ir. A t s li d e n u m b e r 1 5 w e h i g h l i g h t th a t t h e t e a m i n s o f a r a s th e m e m o r a n d u m g o e s w a s g o i n g t o d e t e r m i n e th e a p p r o a c h t h a t w o u l d b e s t y i e l d b e n e fi t s fo r Tr a n s n e t a s w e l l a s t h e O E M ’s b y t a k in g i n t o c o n s i d e r a ti o n tw o th i n g s . A D V M A H L A P E S E L L O : Ye s . M R T H O B A N I T R E V O R M N YA N D U : Q u a n ti fy in g d i ff e r e n t n e g o t i a t i o n le v e ls a n d th e r e a s o n s f o r a r e v is e d p r ic in g . A D V M A H L A P E S E L L O : Ye s . M R TH O B A N I T R E V O R M N YA N D U : A n d 2 r e v ie w in g t h e a c c u r a c y a n d 20 a s s u m p t io n s in t h e m o d e l s i n o r d e r to in f o r m t h e n e g o t ia t io n s . ADV MAHLAPE SELLO: Ye s . C H A I R P E R S O N : S o t h i s is t h e Tr a n s n e t te a m ? M R T H O B A N I T R E V O R M N YA N D U : I n d e e d C h a ir. CHAIRPERSON: Hm. M R T H O B A N I T R E V O R M N YA N D U : C h a i r u n d e r t h e h e a d e r M o t iv a t i o n Page 60 of 116 30 MAY 2019 – DAY 102 t h e m e m o r a n d u m h i g h li g h te d i n o r d e r to m o v e t o D u r b a n t h e r e w o u l d b e d i ff e r e n t h e a d s o f a d d i ti o n a l c o s ts . A D V M A H L A P E S E L L O : Ye s . M R T H O B A N I T R E V O R M N YA N D U : Th e m e m o r a n d u m s u m m a r is e d t h e s e d i ff e r e n t h e a d s o f c o s ts a s l a b o u r c o s ts . A D V M A H L A P E S E L L O : Ye s . M R T H O B A N I T R E V O R M N YA N D U : M a te r ia l c o s t s , w a r e h o u s i n g c o s t s , t e c h n ic a l support, o p e r a ti o n a l and l o g is ti c a l e ff e c t s , p h y s ic a l tr a n s p o r t a ti o n o f m a t e r i a ls a n d r e s o u r c e s , i n c r e m e n t a l w a r e h o u s i n g 10 c o s ts , f in a n c in g a n d r is k c o s ts d u e t o ti m e c o n s tr a i n ts a n d d e l a y s . T h e m e m o r a n d u m a ls o i ll u s tr a t e d t h a t t h e r e w o u l d b e a n c il l a r y b e n e fi ts f o r Tr a n s n e t and savings a s s o c i a te d with the two O E M ’s now m a n u f a c t u r in g fr o m D u r b a n . ADV MAHLAPE SELLO: Yo u r h e a d i n g a t s l i d e 1 6 s p e a k s o f th e – s p e a k s to t h e 1 9 M a y 2 0 1 5 m e m o r a n d u m . M R T H O B A N I T R E V O R M N YA N D U : Ye s C h a ir. A D V M A H L A P E S E L L O : A n d t h a t is o u r p a g e 9 111 . M R T H O B A N I T R E V O R M N YA N D U : Ye s C h a ir. A D V M A H L A P E S E L L O : T h e i s s u e s li s te d t h e r e … 20 C H A I R P E R S O N : W e l l t h a t i s w h a t I w a s e x a c t ly tr y i n g t o lo o k a t s o w e h a v e n o t m o v e d a w a y fr o m t h e m e m o r a n d u m b u t y o u d is c u s s in g w h a t i t d e a lt w i t h ? M R T H O B A N I T R E V O R M N YA N D U : W h a t t h e m e m o r a n d u m s o u g h t CHAIRPERSON: Ja. M R T H O B A N I T R E V O R M N YA N D U : A p p r o v a l f o r. Page 61 of 116 30 MAY 2019 – DAY 102 CHAIRPERSON: I th in k w h a t c o n fu s e d m e i s t h a t I th o u g h t s h e w a s s a y in g s h e w a s m o v i n g a w a y fr o m t h e m e m o r a n d u m . ADV MAHLAPE SELLO: I h a d u n d e r s t o o d M r M n y a n d u to s a y h e is d o n e w i th t h e m e m o r a n d u m b u t c l e a r ly n o t . CHAIRPERSON: Ja, ja. A D V M A H L A P E S E L L O : C h a ir. M R T H O B A N I T R E V O R M N YA N D U : I a p o l o g is e C h a ir. C H A I R P E R S O N : O k a y. N o t h a t is fi n e . M R T H O B A N I TR E V O R M N YA N D U : 10 W e a r e d o n e w i th l o o k i n g a t t h e c o p y i ts e lf . A D V M A H L A P E S E L L O : Ye s . M R T H O B A N I TR E V O R M N YA N D U : B u t s u m m a r i s i n g s o m e o f th e [i n d is t in c t] p a r ts o f t h e m e m o r a n d u m . C H A I R P E R S O N : J a , j a . O k a y. A D V M A H L A P E S E L L O : J a . M y q u e s t io n t h e n is y o u l is t t h e s e i s s u e s o r th e s e fa c t o r s t h a t e x p la in t h e c o s ts o f r e l o c a ti o n . M R T H O B A N I T R E V O R M N YA N D U : I n d e e d C h a ir. ADV MAHLAPE SELLO: And we are – I must – we must understand fr o m y o u r s li d e t h a t t h o s e is s u e s e m a n a t e fr o m t h e m e m o r a n d u m i ts e lf ? 20 M R T H O B A N I T R E V O R M N YA N D U : I n d e e d C h a ir. A D V M A H LA P E S E L L O : Then I go back to my previous question. In li g h t o f th e f a c t t h a t th e a c t u a l p r o p o s a l c o m e s i n J u n e 2 0 1 5 h o w d o t h e d r a f t e r s o f th is m e m o r a n d u m i n M a y k n o w t h e f a c t o r s th a t w i ll b e t a k e n in t o c o n s id e r a ti o n in c o m p u t i n g th e c o s ts o f r e l o c a ti o n ? W e r e y o u a b l e t o e s t a b l is h ? Page 62 of 116 30 MAY 2019 – DAY 102 M R T H O B A N I T R E V O R M N YA N D U : I t is i n r e l a t i o n t o t h e m e m o r a n d u m r e c e i v e d e a r li e r in M a y w h i c h is fo r t h e a m o u n t o f R 6 3 5 m il li o n o d d . A D V M A H L A P E S E L L O : H a v e – d o y o u h a v e th a t m e m o r a n d u m ? M R T H O B A N I T R E V O R M N YA N D U : W e a c t u a lly d o h a v e a c o p y. A D V M A H L A P E S E L L O : A c o m p le t e o n e ? M R T H O B A N I T R E V O R M N YA N D U : Ye s . S o n o t t h e m e m o r a n d u m t h e p r o p o s a l fr o m C N R – a p o lo g i e s C h a ir. ADV MAHLAPE SELLO: Okay… CHAIRPERSON: 10 Wa s t h e p r o p o s a l b y w a y o f j u s t a le t t e r o r a m o r e c o m p r e h e n s iv e d o c u m e n t ? M R T H O B A N I T R E V O R M N YA N D U : I t i s a c o m p r e h e n s iv e d o c u m e n t . C H A I R P E R S O N : O k a y a n d b u t i t i s n o t h e r e i n th e b u n d l e t h a t is h e r e ? M R T H O B A N I T R E V O R M N YA N D U : N o C h a ir. C H A I R P E R S O N : O h . S o t h a t – in t h a t m e m o r a n d u m t h e f i g u r e i s 6 3 5 ? M R T H O B A N I T R E V O R M N YA N D U : I n d e e d i t is s o C h a ir. CHAIRPERSON: Ye s . W h ic h is w h e r e th e 6 3 5 m a y h a v e b e e n t a k e n fr o m ? M R T H O B A N I T R E V O R M N YA N D U : I n d e e d C h a ir. C H A I R P E R S O N : O k a y. O k a y. 20 ADV MAHLAPE SELLO: O k a y t h e n a g a in le t u s lo o k a t s e q u e n c e . R e m e m b e r w e s t a r te d a t 9 m il li o n . M R T H O B A N I T R E V O R M N YA N D U : Ye s . A D V M A H L A P E S E L L O : T h a t is w h a t w e g o t fr o m C N R . M R T H O B A N I T R E V O R M N YA N D U : Ye s . A D V M A H L A P E S E L L O : T h a t is t h e n u p d a t e d t o 3 1 8 ? Page 63 of 116 30 MAY 2019 – DAY 102 M R T H O B A N I T R E V O R M N YA N D U : Ye s . A D V M A H LA P E S E L L O : M u s t t h e C h a ir u n d e r s t a n d t h a t th a t 3 1 8 m il li o n p r o p o s a l w a s s u b s e q u e n tl y f o ll o w e d b y a n o t h e r o f 6 3 5 m i lli o n ? M R T H O B A N I T R E V O R M N YA N D U : I n d e e d C h a ir. ADV MAHLAPE SELL O: And then the yet to come in June of 2015 after t h is m e m o r a n d u m o f 6 6 9 ? M R T H O B A N I T R E V O R M N YA N D U : I n d e e d C h a ir. ADV MAHLAPE SELLO: O k a y s o w e a r e n o w o n a – w e a r e ta lk in g about third and fourth proposals now? 10 M R T H O B A N I T R E V O R M N YA N D U : I n d e e d C h a ir. A D V M A H L A P E S E L L O : T h a n k y o u . W e f o l lo w in g y e s . M R T H O B A N I T R E V O R M N YA N D U : Th e m e m o r a n d u m w a s a p p r o v e d b y M r G a m a w e m a k e th e n o t e s o n 1 9 M a y 2 0 1 5 . A D V M A H L A P E S E L L O : Ye s . M R T H O B A N I T R E V O R M N YA N D U : G o i n g f o r w a r d t h e f o l lo w in g p e r s o n n e l m a d e u p t h e n e g o t ia t io n t e a m . M r A n o j S i n g h , M r G a r r y P i t a , M r N d ip h i w e S il in g a , M r E M o l e ts a n e , Mr T h a m s a n q a J iy a n i a s w e ll a s M s L i n d iw e M d le ts h e . A D V M A H L A P E S E L L O : F o r t h e r e c o r d I t h i n k t h a t is M s E M o l e ts a n e 20 n o t M r. M R T H O B A N I T R E V O R M N YA N D U : O h . A D V M A H L A P E S E L L O : T h a t is w h a t y o u h a v e o n t h e s l i d e . C H A I R P E R S O N : S o r r y w h ic h o n e ? A D V M A H L A P E S E L L O : H e – M s E M o le ts a n e . M R T H O B A N I T R E V O R M N YA N D U : M o l e t s a n e . Page 64 of 116 30 MAY 2019 – DAY 102 A D V M A H L A P E S E L L O : O n b e h a l f o f T E h e h a d s a i d Mr M o le t s a n e . CHAIRPERSON: Mr oh. M R T H O B A N I T R E V O R M N YA N D U : A p o l o g i e s . C H A I R P E R S O N : O h o k a y. M R T H O B A N I T R E V O R M N YA N D U : M y a p o l o g i e s C h a ir. Ms E M o le t s a n e . A D V M A H L A P E S E L L O : Ye s . M R T H O B A N I TR E V O R M N YA N D U : C h a ir w e n o w ta k e y o u t h r o u g h t h e p r o p o s a l s s u b m i t te d o n b e h a l f B o m b a r d i e r Tr a n s p o r t a ti o n B T h a v in g 10 t a k e n y o u t h r o u g h t h e p r o p o s a ls o f C N R a f t e r w h ic h w e w i ll t h e n l o o k a t t h e p r o c e s s f o l l o w e d i n t e r n a lly i n o r d e r t o a p p r o v e t h e r e lo c a t io n c o s ts . B o m b a r d i e r Tr a n s p o r t a ti o n . CHAIRPERSON: I a m s o r r y. I thought earlier on you had said B o m b a r d i e r Tr a n s p o r t a ti o n h a d n o t p u t u p a p r o p o s a l w h e n t h e y w e r e a s k e d t o . D i d t h e y s u b s e q u e n t ly d o ? M R T H O B A N I T R E V O R M N YA N D U : Ye s C h a ir. C H A I R P E R S O N : O h a n d th is is w h a t w e ta lk i n g a b o u t n o w ? M R T H O B A N I T R E V O R M N YA N D U : Ye s C h a ir. C H A I R P E R S O N : O k a y. 20 M R T H O B A N I T R E V O R M N YA N D U : Yo u w i ll r e c a l l t h a t w e m a d e t h e p o i n t t h a t o n t h e 6 J u n e t h e y a d d r e s s e d a le t t e r to Tr a n s n e t Fr e i g h t R a il r e c o r d in g t h a t p u r s u a n t to t h e is s u a n c e o f a l e tt e r b y t h e t h e n G r o u p C h i e f E x e c u t iv e M r Br ia n M o l e fe w h ic h w a s a f te r t h e s ig n a tu r e o f t h e m a in a g r e e m e n t a s w e l l a s t h e s u b - c o n tr a c t. T h e y w e r e n o w w il li n g t o c o n s id e r b e i n g lo c a t e d in D u r b a n a n d t h e y w o u l d w o r k o n t h e Page 65 of 116 30 MAY 2019 – DAY 102 n e c e s s a r y d o c u m e n t a t io n i n o r d e r to c o m m u n ic a te t o Tr a n s n e t w h a t w o u ld b e t h e c o s t d i ffe r e n c e o f t h e m b e in g l o c a t e d e l s e w h e r e . CHAIRPERSON: Thank you. A D V M A H L A P E S E L L O : A n d b y 6 o f J u n e it is 2 0 1 4 ? M R T H O B A N I T R E V O R M N YA N D U : 2014. A D V M A H L A P E S E L L O : To b e e x a c t. M R T H O B A N I T R E V O R M N YA N D U : 2 0 1 4 t o c l a r i fy C h a ir. A D V M A H L A P E S E L L O : Ye s . M R T H O B A N I T R E V O R M N YA N D U : 10 C h a i r f o l l o w in g o n fr o m w h a t w e h a v e j u s t d is c u s s e d t h e n B T p r e s e n te d t h r e e p r o p o s a ls t o Tr a n s n e t . W h i ls t w it h – b e t w e e n – i n b e t w e e n t h e s e t h r e e p r o p o s a ls th e r e w e r e le t t e r s t h a t w e r e is s u e d b y B T i n w h ic h B T s o u g h t t o t r y a n d e x p l a i n o r s u b s t a n t ia t e it s p r o p o s a l s . S e p te m b e r 2 0 1 4 . T h e p r o p o s a l s w e r e s u b m i t t e d d u r in g A s e c o n d p r o p o s a l s u b m i t te d d u r in g A p r i l 2 0 1 5 a n d t h e t h ir d p r o p o s a l w h ic h w a s e v e n t u a l ly a c c e p te d a l b e i t w it h a d is c o u n t a p p li e d is t h e J u ly 2 0 1 5 o ffe r w h ic h C h a i r w il l f in d fr o m p a g e 6 3 o f t h e b u n d l e th a t th e C h a i r h a s t h is m o r n in g . ADV MAHLAPE SELLO: And the… M R T H O B A N I T R E V O R M N YA N D U : J u s t t o … 20 A D V M A H L A P E S E L L O : T h a t b e y o u r t a b 4 o f y o u r p r e s e n ta t io n ? M R T H O B A N I T R E V O R M N YA N D U : U n d e r t a b 4 o f t h e p r e s e n t a ti o n . A D V M A H L A P E S E L L O : Ye s . M R T H O B A N I T R E V O R M N YA N D U : J u s t t o t a k e th e … CHAIRPERSON: T h a t is – t h a t is t a b f o r t h e p r e s e n t a ti o n i s E x h i b i t B B 8 [ c ]. Page 66 of 116 30 MAY 2019 – DAY 102 A D V M A H L A P E S E L L O : Ye s C h a ir. C H A I R P E R S O N : I t h i n k w e ju s t n e e d e d t o p u t t h a t o n r e c o r d A D V M A H L A P E S E L L O : O n r e c o r d i n d e e d C h a ir. CHAIRPERSON: Because we might not have put it on record. So tab number ADV MAHLAPE SELLO: 4. CHAIRPERSON: 4. A D V M A H L A P E S E L L O : Ye s C h a ir. C H A I R P E R S O N : T h a n k y o u . Ye s . 10 M R T H O B A N I T R E V O R M N YA N D U : C h a ir u n d e r ta b n u m b e r 4 w h a t y o u w i ll f i n d is e m a i l c o r r e s p o n d e n c e fr o m M s L i n d i w e M d le ts h e in w h ic h w e a r e a b l e t o g a th e r a n d c o n fir m t h a t th e p r o p o s a ls fr o m B T w e r e i n d e e d s h a r e d w i t h Tr a n s n e t b e c a u s e s h e in tu r n o n 2 0 J u n e 2 0 1 5 w a s s h a r in g t h e d i ff e r e n t v e r s io n s w it h h e r c o l l e a g u e s a t Tr a n s n e t. A n d o v e r le a f th e p r o p o s a l s f r o m Tr a n s n e t . T h e C h a ir n e e d n o t c o n s i d e r t h e m in t e n s e ly b e c a u s e b o t h in o u r r e p o r t a s w e l l a s i n t h e p r e s e n ta t io n w e h ig h l i g h t t h a t th e r e l o c a ti o n c o s ts i n s o fa r a s B T w a s c o n c e r n e d w e r e m a d e u p o f t h e tr a n s p o r t a ti o n c o s ts , lo g i s tic s c o s ts , t h e l o s s o f i n d u s t r i a l f o o t p r in t s y n e r g i e s a n d is h o w t h e a m o u n t o f 6 3 4 in t h e f ir s t i n s t a n c e 20 R 6 3 4 3 1 5 0 0 0 ,0 0 w a s m a d e u p w h i c h th e n i n A p r il b e c a m e a n o ffe r o f R 6 3 4 3 1 5 0 0 0 ,0 0 t h e C h a ir w i ll s e e th is n o w fr o m s l i d e 1 9 o f t h e p r e s e n t a ti o n . A n d t h e n l a s t ly a s w e s a i d t h e o ff e r o f R 6 1 8 4 5 7 1 2 5 , 0 0 . A s w e h a v e s a i d t h o s e a r e t h e t h r e e p o i n ts th a t th e p r o p o s a l s o n B T were based on. We make the point in our report there is however no c o n c l u s iv e b r e a k d o w n o f t h e c o s ts w h ic h w o u l d s e e k t o s u p p o r t t h e Page 67 of 116 30 MAY 2019 – DAY 102 a m o u n ts t h a t w e r e c l a i m e d in e a c h r e s p e c t . CHAIRPERSON: W h a t w a s – w h a t is t h e l o s s o f i n d u s tr i a l f o o t p r i n t synergies? M R T H O B A N I T R E V O R M N YA N D U : C h a ir a s w e – a s w e u n d e r s t a n d i t . CHAIRPERSON: Hm. M R T H O B A N I T R E V O R M N YA N D U : I t i s a n a r g u m e n t t h a t s a y s if I a s a n O E M a m b a s e d in G a u te n g . CHAIRPERSON: Hm. M R TH O B A N I T R E V O R M N YA N D U : I h a v e g o t r e l a ti o n s s y n e r g ie s w i t h 10 p a r t ic u l a r s u p p l ie r s w h o w o u l d n o t n e c e s s a r ily b e a b le t o s u p p ly m e w i t h th e m a t e r ia ls I n e e d if I w e r e to b e l o c a te d in a d i ff e r e n t l o c a ti o n or would do so at an extra cost. C H A I R P E R S O N : S o e ff e c ti v e ly s a y in g i f I o p e r a t e fr o m J o h a n n e s b u r g . / M R T H O B A N I T R E V O R M N YA N D U : Ye s C h a ir. CHAIRPERSON: I have in the course of my business certain people t h a t I d e a l w it h w h o m a y s u p p l y m e w it h c e r ta i n th i n g s fo r m y b u s i n e s s a n d I h a v e a c e r ta in – I h a v e e s ta b lis h e d c e r ta in r e l a t i o n s h i p s w i t h t h e m a n d m a y b e I g e t d i s c o u n ts a n d if w e o p e r a t e fr o m D u r b a n I t a k e t h a t i n to a c c o u n t w h e n I q u o te t o y o u b u t i f I a m g o in g t o b e i n a n o t h e r 20 p l a c e I w i ll n o t h a v e th o s e d is c o u n t s a n d t h e r e fo r e I w o u l d – I w o u ld p a y m o r e t h a n I w o u l d p a y i f I w a s i n J o h a n n e s b u r g a n d th a t I h a v e to pass on to you. M R T H O B A N I T R E V O R M N YA N D U : I n d e e d C h a ir. C H A I R P E R S O N : Ye s . O k a y. B u t i t s h o u l d – d o e s i t w a r r a n t – d o e s i t w a r r a n t to b e a n i te m u n d e r lo s s b e c a u s e a l l I r e a ll y n e e d t o d o is l o o k Page 68 of 116 30 MAY 2019 – DAY 102 a t h o w m u c h I w il l g e t th i n g s i n D u r b a n a n d s a y w e ll m y p r i c e w i ll g o u p b e c a u s e t h is is w h a t I w i ll b e p a y in g fo r t h i n g s t h a t I m u s t g e t. M R T H O B A N I T R E V O R M N YA N D U : C h a ir in o r d e r t o u n d e r s t a n d c a n I r e p h r a s e th e q u e s t io n a n d a s k w h e t h e r it w a r r a n ts a p r ic e v a r i a ti o n a s such. CHAIRPERSON: Hm. M R T H O B A N I T R E V O R M N YA N D U : C h a ir i t w o u l d d e p e n d o n th e n e g o ti a ti o n s o f p a r ti e s t h a t h a v e c o n tr a c t e d a r m ’s l e n g t h b u t i t w o u l d n o t a u t o m a t ic a ll y a r is e th a t th e y s h o u l d b e a n a d d it i o n a l c o s t. 10 CHAIRPERSON: Hm. M R T H O B A N I T R E V O R M N YA N D U : N o . C H A I R P E R S O N : H m . J a o k a y th a n k y o u . A D V M A H L A P E S E L L O : A n d i f a n y t h i n g – i f a n y t h in g i t m i g h t r e s u l t i n a saving? M R T H O B A N I T R E V O R M N YA N D U : I n d e e d C h a ir. ADV MAHLAPE SELLO: N o w I l o o k a t y o u r t a b fo r T T M 4 a t t a b 4 o f B B 8 [ c ] a n d i n p a r t ic u l a r a t p a g e 7 1 I s e e t h a t t h e R 6 3 4 3 1 6 0 0 0 ,0 0 i s g iv e n a s a fi x e d p r ic e a n d i t is a g l o b u l a r a m o u n t. I have looked through the document and unless I misread the document I do not see 20 t h e b r e a k d o w n o f t h a t a m o u n t p e r i t e m a s y o u h a v e li s t e d in a s e n s e t h a t I d o n o t s e e w h a t p o r t io n o f t h a t R 6 3 4 m il li o n is a ll o c a t e d f o r tr a n s p o r t a ti o n c o s ts a n d f o r l o g is ti c s a n d w h a t b a la n c e t h e n i s c o m p u te d a s a l o s s o f i n d u s tr ia l fo o t p r i n t s y n e r g i e s ? M R TH O B A N I T R E V O R M N YA N D U : In d e e d i t is s o C h a ir t h e r e is n o b r e a k d o w n h e n c e w e m a k e th e p o in t th a t w h e r e th e r e is n o b r e a k d o w n Page 69 of 116 30 MAY 2019 – DAY 102 o f t h e c o s ts th a t is i n s u p p o r t o r w o u l d b e i n s u p p o r t o f t h e a m o u n t c la i m e d . ADV MAHLAPE SELLO: D id y o u – w e r e y o u a b l e t o g e t a n u n d e r s t a n d in g fr o m a n y m e m b e r o f Tr a n s n e t t h a t y o u i n t e r v i e w e d a s t o t h e e x a c t m e a n i n g o f l o s s o f i n d u s tr i a l fo o t p r i n t s y n e r g i e s ? M R T H O B A N I T R E V O R M N YA N D U : N o C h a ir I m u s t r e c o r d t h a t w e d id n o t n e c e s s a r i ly e n g a g e t h e m o n th a t c o n c e p t. A D V M A H LA P E S E L L O : A n d I th i n k M r S e d u m e d i p o i n t e d o u t t h a t y o u h a d a s y e t n o t e n g a g e d w it h B o m b a r d i e r o n t h e s e is s u e s ? 10 M R T H O B A N I T R E V O R M N YA N D U : Ye s t h a t is c o r r e c t C h a ir. C H A I R P E R S O N : To th e e x te n t t h a t lo g is ti c c o s ts a r e lis t e d a s s e p a r a t e fr o m tr a n s p o r t a ti o n c o s ts w h a t d id t h a t e n t a i l? M R TH O B A N I T R E V O R M N YA N D U : C h a ir I th i n k i t w o u ld o n l y b e e x p l a i n a b l e o r e x p l a i n e d b y t h e d r a f t e r s o f – o r t h o s e w h o c o n s id e r e d t h e t w o to b e d i ff e r e n t . Because one – when one speaks of tr a n s p o r t a ti o n c o s ts . CHAIRPERSON: Hm. M R T H O B A N I T R E V O R M N YA N D U : O n e is r e fe r r i n g t o l o g is t ic s . C H A I R P E R S O N : H m . T h a t is … 20 MR THOBANI TREVOR M N YA N D U : T h a t is what we would – u n d e r s t a n d in g . C H A I R P E R S O N : Ye s . M R T H O B A N I T R E V O R M N YA N D U : Ye s C h a ir. CHAIRPERSON: And you did not get a chance to talk to Bombardier a b o u t t h a t? Page 70 of 116 30 MAY 2019 – DAY 102 M R T H O B A N I T R E V O R M N YA N D U : C h a ir a s h a s j u s t p o i n t e d o u t . C H A I R P E R S O N : Ye s . MR THOBANI TREVOR M N YA N D U : We have not yet engaged B o m b a r d i e r in r e l a ti o n to t h e s e is s u e s . CHAIRPERSON: Ja. Ye s . B u t i t w o u l d a p p e a r t h a t Tr a n s n e t d i d n o t in t e r r o g a t e t h e – t h a t a s w e ll h e y ? M R T H O B A N I T R E V O R M N YA N D U : Ye s C h a ir. CHAIRPERSON: Hm. Okay thank you. A D V M A H LA P E S E L L O : 10 Th a n k y o u C h a ir. Now Mr Mnyandu again lo o k in g a t t h e p a p e r s p l e a s e r e f e r to T T M 4 a t p a g e 6 3 o f B B 8 [ c ] a n d t h a t y o u s a i d is t h e e m a il fr o m M s L in d iw e M d le t s h e o f 2 0 J u n e 2 0 1 5 . M R T H O B A N I T R E V O R M N YA N D U : Ye s . A D V M A H LA P E S E L L O : C i r c u l a ti n g t o h e r c o ll e a g u e s th e B o m b a r d i e r proposal. M R T H O B A N I T R E V O R M N YA N D U : Ye s . ADV MAHLAPE SELLO: I read that email and it says and I quote: “Good day please find attached Bombardier proposal as requested. 1 . In i ti a l p r o p o s a l d a t e d 2 6 S e p t e m b e r 2 0 1 4 a n d a s 20 b u ll e ts • A d d i t io n a l i n f o r m a ti o n d a t e d 2 O c t o b e r 2 0 1 4 . • F u r th e r c l a r i f ic a t i o n d a t e d 1 0 O c t o b e r 2 0 1 4 . • D e t a i l e d e x p l a n a t io n d a t e d 3 N o v e m b e r 2 0 1 4 . 2 . A n d s e c o n d ly r e v i s e d p r o p o s a l d a t e d 1 0 A p r i l 2 0 1 5 . ” W h e n I p e r u s e d T T M 4 I s e e m t o f in d o n ly a l e t t e r fr o m B o m b a r d i e r Page 71 of 116 30 MAY 2019 – DAY 102 dated 26 September 2014. W h a t – a d o c u m e n t t e r m e d fi n a l n o t ic e o f c o n tr a c to r p r o p o s e d v a r ia t i o n w i th r e s p e c t t o Tr a n s n e t’s r e q u e s t to m o v e T E ’s f a c i li ty l o c a ti o n fr o m K o e d o e s p o o r t to D u r b a n a n d th a t w o u l d a p p e a r a t p a g e 7 2 t o a ls o b e d a t e d 2 6 S e p te m b e r 2 0 1 4 . It is then f o ll o w e d b y a s c h e d u l e o f d e l iv e r i e s . M R T H O B A N I T R E V O R M N YA N D U : Ye s C h a ir. ADV MAHLAPE SELLO: I d o n o t s e e m t o h a v e u n d e r T T M 1 4 t h is a d d it i o n a l i n f o r m a ti o n d a t e d 2 O c to b e r 2 0 1 4 , th e f u r t h e r c la r i fi c a t io n o f 1 0 O c to b e r 2 0 1 4 , d e t a il e d e x p l a n a t i o n o f 3 N o v e m b e r 2 0 1 4 . 10 M R T H O B A N I T R E V O R M N YA N D U : To … A D V M A H L A P E S E L L O : Yo u c o n fi r m th a t ? M R T H O B A N I T R E V O R M N YA N D U : Ye s C h a ir. ADV MAHLAPE SELLO: O k a y. N o w m y q u e s t io n is w e r e y o u a b l e to lo c a t e th e s e p a r t ic u l a r d o c u m e n t s th a t a r e l is te d h e r e f o r – i s s u e d in October 2014 and November – October and November 2014? M R T H O B A N I T R E V O R M N YA N D U : Ye s . To p l a c e m a t te r s i n to c o n te x t. A D V M A H L A P E S E L L O : Ye s . M R T H O B A N I T R E V O R M N YA N D U : Th is w a s in f o r m a ti o n t h a t c a m e t o h a n d p u r s u a n t to t h e c o m p le t io n o f o u r r e p o r t t o g e t h e r w i t h th e 20 s t a te m e n t th a t w i ll b e s u b m i tt e d to t h e c o m m is s i o n . A D V M A H L A P E S E L L O : Ye s . M R T H O B A N I T R E V O R M N YA N D U : W e w i ll p r o v i d e t h e f u r t h e r c la r i fi c a t io n s w h ic h a r e d o c u m e n ts t h a t w e a t t a c h e d t o th e p a r ti c u la r email. A D V M A H L A P E S E L L O : O k a y. Page 72 of 116 30 MAY 2019 – DAY 102 M R T H O B A N I T R E V O R M N YA N D U : R a th e r w h a t th e e m a i l s e e k s to d o is t o a t l e a s t g i v e c r e d e n c e to th e f a c t th a t t h e p r o p o s a ls f r o m B o m b a r d i e r w e r e in d e e d r e c e i v e d b y Tr a n s n e t . ADV MAHLAPE SELLO: O k a y. S o t h e n w e c a n e x p e c t th r o u g h t h e s u b m is s io n o f a s u p p l e m e n ta r y s t a t e m e n t t h e d o c u m e n t s l is t d a t e d 2 October 2014, 10 October 2014, 3 November 2014 and the revised p r o p o s a l o f 11 0 A p r i l 2 0 1 5 . M R T H O B A N I T R E V O R M N YA N D U : I c o n f i r m C h a ir. A D V M A H L A P E S E L L O : O k a y. T h a n k y o u . 10 C H A I R P E R S O N : C a n I g o b a c k t o t h a t is s u e o f w h a t t h e l o g is ti c s c o s ts r e fe r r e d t o a s w e l l a s t h e o t h e r i t e m . D i d y o u a s k M s M d l e ts h e w e l l w h a t th e s e w e r e a n d w h a t h e r u n d e r s ta n d i n g w a s o f th e l o g is t ic s c o s t s in s o f a r a s t h e y w e r e a s e p a r a t e i t e m fr o m tr a n s p o r t a ti o n c o s t s b e c a u s e if th e y a g r e e d t o p a y in g f o r c e r ta i n t h i n g s a t l e a s t t h e y s h o u l d u n d e r s t a n d w h a t th o s e t h i n g s a r e . M R T H O B A N I T R E V O R M N YA N D U : C h a i r a g a i n to p l a c e m a t te r s in t o c o n te x t in s o f a r a s th e d is c u s s i o n s a h e a d w it h M s M d l e ts h e . 1. T h e e x c h a n g e s i n r e la t io n t o t h e is s u e s o f r e l o c a t i o n w e r e r a t h e r h o s til e . 20 2 . S h e g a v e th e i m p r e s s i o n t h a t s h e b e i n g a S C S o f S u p p ly C h a ir S e r v ic e s p e r s o n n e l w o u ld n o t h a v e t h e e x p e r t is e to d e a l w it h a n a s s e s s m e n t o f t h e p r o p o s a ls n o t w i t h s t a n d i n g t h e f a c t th a t s h e w a s p a r t o f t h e n e g o ti a ti o n te a m . T h e r e f o r e w e t o o k t h e v i e w t h a t t o tr y a n d t a k e h e r th r o u g h e a c h o f th e proposals Page 73 of 116 30 MAY 2019 – DAY 102 CHAIRPERSON: Ja. M R T H O B A N I T R E V O R M N YA N D U : W o u ld n o t b e … CHAIRPERSON: Serve any purpose. M R T H O B A N I T R E V O R M N YA N D U : W o u l d n o t b e s e r v i n g a n y p u r p o s e f o r o u r i n v e s t ig a ti o n s . C H A I R P E R S O N : Ye s . O k a y. B u t y o u a r e n o t s u r e w h e th e r t h e l a c k o f c o o p e r a ti o n w a s – a r o s e j u s t fr o m th e f a c t t h a t s h e s e e m e d to b e h o s til e o r s h e m i g h t g e n u i n e ly n o t h a v e k n o w n c e r t a i n t h in g s b e c a u s e t h e y f a l l o u ts id e h e r e x p e r ti s e . 10 M R T H O B A N I T R E V O R M N YA N D U : C h a ir I a m n o t s u r e . C H A I R P E R S O N : Ye s . J a , j a . B u t I w o u l d h a v e t h o u g h t t h a t i f y o u a r e a m e m b e r o f a n e g o t ia t in g t e a m e v e n i f s o m e t h i n g f a ll s o u t s i d e y o u r e x p e r t is e th a t a t l e a s t fr o m th o s e i n t h e t e a m w h o h a v e th e e x p e r t is e y o u w o u l d w a n t t o u n d e r s ta n d w h a t is t h is a b o u t s o th a t i f y o u a s p a r t o f a te a m a r e p a r t y t o a d e c i s i o n t o s a y w e a p p r o v e th is y o u c a n a t le a s t e x p l a i n i f y o u a r e a s k e d . M R T H O B A N I T R E V O R M N YA N D U : C h a ir I t h in k – y e s th a t is w h a t o n e w o u ld e x p e c t . CHAIRPERSON: Hm. 20 M R TH O B A N I T R E V O R M N YA N D U : B u t I t h in k to – m a t te r s w i ll b e p l a c e d in t o b e t te r c o n t e x t a s w e m o v e f o r w a r d a n d w e d e a l w i t h s o m e c r i ti c a l e m a il c o m m u n i q u e a m o n g s t t h e n e g o t ia t io n t e a m m e m b e r s . C H A I R P E R S O N : Ye s o k a y. T h a n k y o . ADV MAHLAPE SELLO: B u t b e f o r e w e g e t t h e r e Mr M n y a n d u a g a i n I a m a t T T M 4 p a g e 6 3 o f y o u r b u n d le . I s e e th e a d d r e s s e e s t h e r e a p p e a r Page 74 of 116 30 MAY 2019 – DAY 102 a s M r G a r r y P it a , Mr T h a m s a n q a J iy a n i , Mr A n o j S i n g a n d M r Yu s u f L e h a r. M R T H O B A N I T R E V O R M N YA N D U : I n d e e d C h a ir. ADV MAHLAPE SELLO: F o l lo w in g o n t h e C h a i r ’s q u e s t i o n w e u n d e r s t a n d t h a t y o u d id n o t – y o u h a v e n o t h a d o p p o r t u n i ty t o i n te r v i e w M r A n o j Si n g h o n th e b a s is t h a t b y t h e ti m e y o u u n d e r t o o k y o u r in v e s t i g a t io n s h e w a s n o lo n g e r a n e m p l o y e e a t Tr a n s n e t? M R T H O B A N I T R E V O R M N YA N D U : I n d e e d C h a ir. A D V M A H L A P E S E L L O : N o w d id y o u h a v e o p p o r t u n i ty t o i n te r v i e w Mr 10 G a r r y P i t a , M r Yu s u f L a h e r, Mr T h a m s a n q a J i y a n i a n d i f y o u d i d d i d y o u r a i s e t h e s e is s u e s w i t h a n y o n e o f t h e m ? M R TH O B A N I T R E V O R M N YA N D U : W e h a d th e o p p o r t u n i ty i n d e e d t o in t e r v ie w M r Th a m s a n q a J i y a n i. A D V M A H L A P E S E L L O : Ye s . M R T H O B A N I T R E V O R M N YA N D U : H e p o i n t e d o u t t h a t h e w a s o n ly a b l e t o a tt e n d a s i n g l e m e e t i n g in r e s p e c t o f t h e n e g o t i a t i o n s a n d th a t h e p la y e d n o f u r t h e r r o l e . N o w w e w il l g e t t o t h e n o fu r t h e r r o l e a t a la t e r p o in t C h a ir. A D V M A H L A P E S E L L O : O k a y. 20 M R T H O B A N I T R E V O R M N YA N D U : W e th e r e fo r e d i d n o t ta k e h i m t h r o u g h th e p r o p o s a ls s u b m it t e d b y t h e O E M ’s . We did have the o p p o r t u n i ty a ls o to s p e a k t o M r Yu s u f L a h e r. A D V M A H L A P E S E L L O : Ye s . M R TH O B A N I T R E V O R M N YA N D U : W h o g a v e u s a v e r s io n t h a t h e h a d in t e r r o g a t e d p a r ti c u l a r l y th e C N R p r o p o s a l s a n d h e h a d s h a r e d c e r t a i n Page 75 of 116 30 MAY 2019 – DAY 102 c o m m e n t s a n d t h e y w e r e n o t n e c e s s a r i ly a t te n d e d t o t h a t is a p a r t t h a t w e w ill a l s o g e t t o i n th e p r e s e n t a ti o n . ADV MAHLAPE SELLO: Ja. A n d i n s o f a r a s Mr G a r r y P it a is concerned? M R T H O B A N I T R E V O R M N YA N D U : M r G a r r y P i ta w a s n o lo n g e r u n d e r t h e e m p l o y o f Tr a n s n e t a s a t th e ti m e w e u n d e r t o o k o u r in v e s t i g a t io n s . A D V M A H L A P E S E L L O : O k a y. T h a n k y o u . Yo u m a y p r o c e e d t h e n w it h your presentation. M R T H O B A N I T R E V O R M N YA N D U : 10 C h a ir h a v i n g g iv e n y o u t h e s e q u e n c e s o f t h e p r o p o s a ls r e la t e d to b o t h O E M ’s w e n o w t a k e y o u t o in it i a l m e e t in g s h e ld w i th th e m a r i s i n g fr o m th e a p p r o v a l b y Mr S iy a b o n g a G a m a f o r th e n e g o ti a ti o n s . Th a t p a r t ic u l a r m e e t in g w a s h e l d o r r a t h e r th o s e m e e t i n g s w e r e h e l d o n th e s a m e d a y, t h e s a m e l o c a ti o n b e i n g O R Ta m b o I n t e r n a ti o n a l A ir p o r t o n th e 1 9 J u n e 2 0 1 5 . CHAIRPERSON: That memorandum was 19 May or 19 June – 19 May? M R T H O B A N I T R E V O R M N YA N D U : 1 9 M a y C h a ir. C H A I R P E R S O N : O h o k a y. M R T H O B A N I T R E V O R M N YA N D U : O n 1 9 J u n e t h e n e g o t ia t io n te a m m e m b e r s f r o m Tr a n s n e t m e t w i th t h e r e p r e s e n t a ti v e s o f t h e r e s p e c ti v e 20 O E M ’s . C h a ir w h e n w e c o n d u c te d o u r in v e s ti g a t io n a n d w e w e r e p r o v i d e d w it h a tr a n s c r i p t o f th e m e e ti n g f o r r e a s o n s th a t w e w i ll d e a l w i t h n o w w e c o u l d n o t m a k e s e n s e o f i t s o a s to i n c lu d e i t i n o u r r e p o r t . H o w e v e r i n c o n s u lt a ti o n w it h th e e v i d e n c e t e a m le a d e r s f o r th e c o m m i s s io n w e a g r e e d th a t w e s h o u l d n o t d e p r i v e y o u o f t h e d o c u m e n t a n d i n s o d o in g i n p r o v id i n g i t to y o u w h ic h is T T M 7 i t is to b e fo u n d a t Page 76 of 116 30 MAY 2019 – DAY 102 p a g e 9 7 o f B B H – E x h ib i t B B 8 [ c ]. W e a ls o t h e n s o u g h t to s u m m a r is e the points of r e p r e s e n t a tiv e s . d is c u s s i o n s that were h e ld with each of th e C h a ir y o u w il l s e e th a t a t 9 7 a n d 9 8 r e g is te r s o r I s h o u l d s a y p r o p e r ly a t t e n d a n c e r e g is t e r s d a t e d 1 9 J u n e 2 0 1 5 f o r m e e ti n g s h e ld w i t h th e r e p r e s e n t a t iv e s o f t h e n e g o ti a ti o n t e a m . CHAIRPERSON: D i d t h e m e e t in g t h a t w e a r e t a l k i n g a b o u t i n v o l v e Tr a n s n e t m e e t in g w i t h e a c h o f t h e … M R T H O B A N I T R E V O R M N YA N D U : I n d e e d C h a ir. C H A I R P E R S O N : O f t h e e n t i ti e s n o t jo i n t ly ? 10 M R T H O B A N I T R E V O R M N YA N D U : I n d e e d C h a ir. C H A I R P E R S O N : J a . O k a y. M R TH O B A N I T R E V O R M N YA N D U : T h e tr a n s c r i p ts w o u l d h a v e y o u b e li e v e a s s u c h a t l e a s t u n f o r tu n a te ly a n d th e r e a s o n s t h a t w e w e r e r e fe r r i n g to w h e n w e c o n s i d e r e d w h e th e r o r n o t w e c o u l d m a k e s e n s e o f t h e tr a n s c r i p t i n th e f ir s t p l a c e i t d o e s n o t h a v e a n i n tr o d u c t i o n . I t d o e s not alert you to who is speaking at any point. recorded. Th e s p e a k e r s a r e n o t T h e p r o p o s a ls th a t a r e r e fe r r e d t o o n t h e 1 9 J u n e 2 0 1 5 m e e ti n g s i n r e s p e c t o f b o t h O E M ’s d o n o t a c tu a l ly te ll y o u w h ic h v e r s i o n s o f t h e p r o p o s a l s a r e b e i n g d is c u s s e d . 20 However what we s o u g h t to d o a s I s a id in s li d e 2 1 a n d th e s li d e t h a t f o l l o w s is t o s u m m a r i s e w h a t t h e d i s c u s s io n s w e r e a b o u t. C H A I R P E R S O N : Ye s . M R T H O B A N I T R E V O R M N YA N D U : We make the point that the – as y o u h a v e ju s t r e q u e s te d c l a r i f ic a t i o n C h a i r s e p a r a t e d i s c u s s io n s w e r e held with CNR and B T. The f ir s t d is c u s s i o n Page 77 of 116 was h e ld with 30 MAY 2019 – DAY 102 r e p r e s e n t a tiv e s o f C N R w h i c h i n c l u d e d M r M a r k S h a w w h o w a s t h e s o l e d ir e c t o r o f B e c k s a c o m p a n y th a t is a lr e a d y b e e n d e a l t w i t h C h a ir. W e a ls o m a k e th e p o in t a s I h a v e a l r e a d y tr i e d to o u t li n e t h a t t h e tr a n s c r ip t d o e s n o t g iv e y o u a n y in d i c a t io n a s t o w h o i s s p e a k i n g . Yo u r e a lly h a v e t o f o ll o w t h e c o n v e r s a ti o n in o r d e r t o u n d e r s t a n d t h a t th is w o u l d b e a Tr a n s n e t r e p r e s e n ta t iv e a n d t h i s w o u l d b e a C h i n e s e C N R r e p r e s e n t a tiv e . Apologies. In both in s t a n c e s Tr a n s n e t ’s r e p r e s e n t a tiv e s r e f e r r e d t o p r o p o s a ls r e c e iv e d fr o m t h e O E M ’s w i t h o u t n e c e s s a r i ly g i v i n g a n y in d i c a t io n w h a t w e r e t h o s e v e r s i o n s o f t h e 10 proposals. N o t a b ly Tr a n s n e t p e r s o n n e l a d d r e s s e d e a c h O E M o n t h e n e g a tiv e e c o n o m ic d o w n t u r n i n S o u t h A fr ic a . W e s o u g h t to h i g h li g h t t h a t C h a ir w h e n w e s u m m a r is e d t h e d is c u s s i o n s b e c a u s e i f t h e s e w e r e in d i v i d u a ls i n th e m e e t in g c o n c e r n e d w i t h t h e e c o n o m ic d o w n t u r n i n S o u th A f r i c a i t w o u l d b e s tr a n g e a w o r d y o u h a v e u s e d C h a ir t h a t th e y w o u ld a g r e e to a n a g g r e g a t e a m o u n t o f R 1 . 2 b il li o n in a n in s t a n c e w h e r e a s f a r a s w e h a v e f o u n d th e c o s ts a r e w h o l ly u n ju s ti fi a b l e a n d h a v e n o t b e e n s u b s ta n ti a te d . In respect of both proposals of the O E M ’s th e Tr a n s n e t p e r s o n n e l e m p h a s is e d t h e r e q u e s t f o r t h e O E M ’s to a ls o d e m o n s tr a t e w h a t w o u l d b e t h e s a v i n g s o c c a s i o n e d b y t h e m b e in g 20 lo c a t e d in D u r b a n . A D V M A H LA P E S E L L O : B e f o r e w e l e a v e t a b 7 I a m a t p a g e 1 0 0 a n d a c c o r d i n g t o th is d o c u m e n t t h is w o u l d b e th e fir s t p a g e o f th e tr a n s c r ip t ? M R T H O B A N I T R E V O R M N YA N D U : I n d e e d C h a ir. A D V M A H LA P E S E L L O : I t s t a r ts w i th a s y o u r i g h t ly s a y u n f o r tu n a te ly Page 78 of 116 30 MAY 2019 – DAY 102 t h e tr a n s c r i p t d o e s n o t i d e n t if y w h o t h i s – e a c h s p e a k e r is . I t s t a r ts w i t h a s p e a k e r s t a ti n g th a t w a s b e c a u s e o f m e i n C a p e To w n a n d th e m e d i a t o r w a s k ic k e d o u t o f t h i s p r o c e s s . M R T H O B A N I T R E V O R M N YA N D U : Ye s C h a ir. A D V M A H LA P E S E L L O : T h a t s t a r t w o u l d i n d ic a te t o m e th a t t h i s is n o t t h e f u l l t r a n s c r i p t o f t h a t m e e ti n g th a t th e r e h a d b e e n a n e n g a g e m e n t p r i o r t o t h a t s p e a k e r m a k in g t h a t c o m m e n t . M R T H O B A N I T R E V O R M N YA N D U : I n d e e d C h a ir. A D V M A H LA P E S E L L O : 10 W e r e y o u a b l e t o d e t e r m i n e h o w lo n g I w i ll c a l l i t th e u n r e c o r d e d p o r ti o n o f t h e m e e ti n g i f i t is t h a t i t h a d t a k e n b e f o r e th is s p e a k e r s t a t e d a s t h e y d id . M R T H O B A N I T R E V O R M N YA N D U : C h a ir w e w e r e n o t a b l e to w e a r e a w a it i n g in f o r m a t io n o n w h o t h e tr a n s c r i b e r s w e r e . A D V M A H L A P E S E L L O : Ye s . M R TH O B A N I T R E V O R M N YA N D U : W e a r e a w a it i n g th is i n f o r m a t i o n fr o m Tr a n s n e t Fr e i g h t R a i l . A D V M A H LA P E S E L L O : A n d if I g o to p a g e 1 2 3 e v e n w it h B T I s e e t h e s a m e p r o b l e m . I t – t h e tr a n s c r i p t k ic k s o f f w i t h t h e s p e a k e r s a y i n g t h e w a r e h o u s i n g a m I m i s ta k e n . A n d t h a t is n o t a – a u s u a l w a y o f s t a r ti n g 20 a m e e t in g o r a c o n v e r s a ti o n . M R T H O B A N I T R E V O R M N YA N D U : I t c e r t a i n l y is n o t C h a ir. ADV MAHLAPE SELLO: D o y o u h a v e – w e r e y o u p r o v i d e d w i th t h e a c t u a l a u d i o r e c o r d i n g o f t h is m e e t i n g ? M R T H O B A N I T R E V O R M N YA N D U : N o u n f o r tu n a te ly n o t C h a ir. A D V M A H L A P E S E L L O : W h a t is t h e s o u r c e o f th e tr a n s c r ip t ? Page 79 of 116 30 MAY 2019 – DAY 102 M R T H O B A N I T R E V O R M N YA N D U : I t i s o ffic i a ls i n th e S u p p l y C h a i n S e r v ic e s D e p a r t m e n t o f Tr a n s n e t Fr e i g h t R a i l. ADV MAHLAPE SELLO: O k a y. Did you go back to the same e m p l o y e e s t o e n q u ir e w h e t h e r th e y h a d a m o r e c o m p l e te tr a n s c r i p t o f t h e s e m e e ti n g s ? M R T H O B A N I T R E V O R M N YA N D U : In d e e d C h a ir. T h e y i n d ic a t e d th e y d o n o t a n d i t is in t h a t r e s p e c t o r i n th a t r e g a r d t h a t w e h a v e r e q u e s t e d a n d a r e s ti ll a w a i ti n g t h e d e ta il s o f t h e c o m p a n y t h a t w o u l d h a v e tr a n s c r ib e d t h e m e e t i n g . 10 A D V M A H L A P E S E L L O : D o y o u k n o w t h e id e n ti ty o f t h e c o m p a n y t h a t tr a n s c r ib e d ? M R T H O B A N I T R E V O R M N YA N D U : N o t a t th is m o m e n t C h a ir. ADV MAHLAPE SELLO: I t a k e i t th a t y o u h a v e e n q u ir e d a s t o t h e ir id e n t i ty ? M R T H O B A N I T R E V O R M N YA N D U : Ye s C h a ir i t is i n r e s p e c t o f t h a t e n q u ir y t h a t w e a w a i t i n fo r m a ti o n fr o m o ffic i a ls a t Tr a n s n e t Fr e i g h t R a il . ADV MAHLAPE SELLO: H o w f a r b a c k w a r d w a s th e r e q u e s t m a d e b y y o u t o th e o ffic i a ls o f Tr a n s n e t? 20 M R T H O B A N I T R E V O R M N YA N D U : W e h a v e h a d d is c u s s i o n s a b o u t i t a t l e a s t in A p r il o f t h i s y e a r. A D V M A H L A P E S E L L O : O k a y. M R T H O B A N I T R E V O R M N YA N D U : Ye s . ADV MAHLAPE SELLO: A n d s i n c e t h e n y o u h a v e r e c e iv e d n o f u r t h e r in f o r m a ti o n ? Page 80 of 116 30 MAY 2019 – DAY 102 M R T H O B A N I T R E V O R M N YA N D U : We have r e c e iv e d no further in f o r m a ti o n a n d t h e b a s is i s t h a t th e k n o w l e d g e a b l e p e r s o n i s n o t a t Tr a n s n e t . A D V M A H L A P E S E L L O : N o t a t Tr a n s n e t a n y m o r e ? M R T H O B A N I T R E V O R M N YA N D U : Ye s . T h a t is M s M d le ts h e w h o i s on suspension. A D V M A H L A P E S E L L O : O k a y. S o i f w e w e r e to m a k e e n q u ir i e s y o u – a r e y o u s u g g e s ti n g t h a t Ms M d l e ts h e w o u l d b e s o m e b o d y t o s p e a k to – t o f in d – t o a t l e a s t l a y o u r h a n d s o n a c o m p l e te v e r s i o n o f t h e 10 tr a n s c r ip t ? M R T H O B A N I T R E V O R M N YA N D U : In s o f a r a s w e h a v e b e e n a d v is e d C h a ir. A D V M A H L A P E S E L L O : I n s o fa r y o u h a v e b e e n a d v is e d , t h a n k y o u . M R T H O B A N I T R E V O R M N YA N D U : Ye s . ADV MAHLAPE SELLO: Then you may proceed. M R T H O B A N I T R E V O R M N YA N D U : C h a ir th e OEMs were a ls o r e q u e s t e d to c l a r i fy a s s u m p t i o n s m a d e a n d t h e c o n t in g e n c i e s b u i l t i n t o t h e ir p r o p o s a ls s o t h a t Tr a n s n e t c o u l d s e e k to a s s i s t th e O E M s w i t h whatever challenges they have. 20 Both OEMs were requested by Tr a n s n e t f o r a p r ic e r e d u c ti o n a n d a r e v i s e d o ffe r. T h e p r i c e r e d u c t io n w o u ld b e i n th e r a n g e b e t w e e n 1 5 a n d 2 5 p e r c e n t . I t w a s a g r e e d th a t o n c e t h e n e g o t ia t io n s w e r e f in a lis e d th e r e w o u ld b e a v a r i a t i o n o r d e r t o t h e m a i n c o n tr a c t c o n c l u d e d . T h e m a i n c o n tr a c t c o n c l u d e d b e in g th e L o c o m o t iv e S u p p l y A g r e e m e n t . I t w a s f u r th e r a g r e e d th a t C N R in p a r t ic u l a r w o u l d r e v is e i t s p r o p o s a l i n o r d e r to c o m m u n ic a t e w h a t w a s Page 81 of 116 30 MAY 2019 – DAY 102 n o t d e ta il e d i n i ts p r o p o s a ls a t th a t p o in t b e i n g t h e m il e s t o n e p a y m e n ts , t h e s c h e d u l e d d e l a y s a n d S u p p ly D e v e l o p m e n t . T h e r e v is e d p r o p o s a ls it w a s a g r e e d w it h b o t h O E M s w o u ld t h e n f o r m p a r t o f t h e v a r i a ti o n o r d e r t h a t w o u l d b e s i g n e d o ff . T h e r e i s p a r t ic u l a r r e f e r e n c e t o t h e Tr a n s n e t Te a m s e e k in g a p p r o v a l fr o m i t s B o a r d S u b C o m m i t t e e o n 3 0 J u n e 2 0 1 5 . A t l e a s t is i t r e c o r d e d i n t h e tr a n s c r ip t i n t h e p a r t t h a t d e a ls w i th C N R . A D V M A H L A P E S E L L O : O k a y. M R T H O B A N I T R E V O R M N YA N D U : T h e B o a r d S u b C o m m i t t e e t h a t w e 10 w o u ld u n d e r s t a n d i t to b e w o u ld b e t h e B o a r d A c q u is i t io n s a n d Disposals Committee. C H A I R P E R S O N : H m . N o w w i t h t h e li m i t a t io n s o r c o n s tr a i n ts t h a t c a m e w i t h t h e tr a n s c r i p t … M R T H O B A N I T R E V O R M N YA N D U : Ye s C h a ir. C H A I R P E R S O N : O f t h e s e m e e t in g s . M R T H O B A N I T R E V O R M N YA N D U : Ye s C h a ir. CHAIRPERSON: W e r e y o u a b l e t o f o r m a v i e w a s to w h e t h e r t h e Tr a n s n e t N e g o ti a ti o n Te a m i n t e r r o g a t e d h o w – f o r e x a m p le w i t h C N R – t h e c o s ts t h a t w e r e i n i t ia ll y e s ti m a t e d t o b e a r o u n d R 9 m i lli o n c o u l d g o 20 u p t o R 6 0 0 - a n d s o m e t h i n g m i ll io n fr o m th a t d i s c u s s i o n d i d y o u – w e r e y o u a b l e to s e e t h a t th e y r a is e d th is is s u e a n d h o w i t w a s e x p la i n e d o r is t h a t s o m e th in g t h a t y o u c a n n o t t e l l f r o m t h e tr a n s c r ip t ? M R T H O B A N I T R E V O R M N YA N D U : C h a i r fr o m t h e tr a n s c r i p t w e a r e u n a b l e to t e l l … C H A I R P E R S O N : Ye s . Page 82 of 116 30 MAY 2019 – DAY 102 M R T H O B A N I T R E V O R M N YA N D U : B u t fr o m e m a i l c o r r e s p o n d e n c e s … CHAIRPERSON: Hm. M R T H O B A N I T R E V O R M N YA N D U : That w i ll be covered in the p r e s e n t a ti o n … CHAIRPERSON: Hm. M R T H O B A N I T R E V O R M N YA N D U : W e d o s e e s o m e q u e s t io n s r a i s e d by some of the members … CHAIRPERSON: Members, yes. M R T H O B A N I T R E V O R M N YA N D U : 10 But we do not have evidence that t h o s e w e r e d e a l t w i th . C H A I R P E R S O N : Ye s . M R T H O B A N I T R E V O R M N YA N D U : L e t a l o n e d e a lt w i t h s u ffi c i e n t ly. C H A I R P E R S O N : Ye s , y e s . M R T H O B A N I T R E V O R M N YA N D U : Ye s C h a ir. CHAIRPERSON: A n d t h e – th e d is c o u n t th a t Tr a n s n e t r e q u e s te d t h e O E c o m e s t o g iv e th e m o f b e t w e e n 1 5 t o 2 5 p e r c e n t . D o y o u g e t – d id y o u g e t t o k n o w h o w Tr a n s n e t a r r i v e d a t t h a t – a t t h o s e d is c o u n t s b e c a u s e i f y o u h a v e b e e n t o ld t h a t t h e p r i c e o r t h e c o s t w il l b e 6 0 0 - a n d s o m e t h i n g m il li o n a n d y o u s a y p l e a s e g iv e m e a d is c o u n t o f 1 5 o r 2 5 20 p e r c e n t o n e is e n ti tl e d t o a s s u m e th a t y o u m e a n y o u w o u ld b e q u it e h a p p y w i th a 1 5 p e r c e n t d i s c o u n t s o y o u c o u l d p a y 1 0 0 s o f m il li o n s f o r s o m e t h i n g t h a t c o u ld h a v e b e e n R 9 m i ll io n a n d m a y b e e v e n l e s s ? M R T H O B A N I T R E V O R M N YA N D U : Ye s C h a ir. T h e r e is n e i th e r a d o c u m e n t n o r is th e r e a n y t h in g i n th e tr a n s c r i p t th a t s u g g e s ts o r d is c l o s e s h o w t h e r e q u e s t f o r a d i s c o u n t i n th a t r a n g e … Page 83 of 116 30 MAY 2019 – DAY 102 CHAIRPERSON: Hm. M R T H O B A N I T R E V O R M N YA N D U : W a s a r r iv e d a t . C H A I R P E R S O N : I t m i g h t b e d i ff ic u l t f o r y o u t o s a y th is b u t I a m – I a m g o i n g t o a s k y o u a n d y o u c a n i n d ic a te i f y o u a r e a b le t o – d i d y o u g e t a n y s e n s e w h e t h e r t h e Tr a n s n e t N e g o ti a ti n g Te a m w a s n e g o ti a ti n g e ffe c tiv e l y o r w a s c a r r y in g o u t th e ir d u ti e s t o n e g o ti a t e t h e b e s t p r ic e f o r Tr a n s n e t t o t h e b e s t o f t h e ir a b il i ti e s o r w e r e t h e y j u s t g o i n g t h r o u g h t h e m o ti o n s a n d I a c c e p t t h a t y o u m i g h t n o t b e a b l e t o s a y ? S o – b u t I a m ju s t w a n t in g – w o n d e r in g w h e t h e r … 10 M R T H O B A N I T R E V O R M N YA N D U : C h a ir … CHAIRPERSON: H a v in g g o n e t h r o u g h t h e t r a n s c r i p t y o u g o t a n y i m p r e s s io n . M R T H O B A N I T R E V O R M N YA N D U : C h a ir it is a q u e s t io n t h a t i s l i n k e d t o t h e f in d in g s t h a t w e m a k e … CHAIRPERSON: Hm. M R T H O B A N I T R E V O R M N YA N D U : A n d t h e r e f o r e fr o m t h a t p e r s p e c t iv e … CHAIRPERSON: Huh-uh. M R T H O B A N I T R E V O R M N YA N D U : 20 I am able to record that the n e g o ti a ti o n t e a m w a s n o t c a r r y in g o u t t h e n e g o ti a ti o n s i n a m a n n e r … CHAIRPERSON: Hm. M R T H O B A N I T R E V O R M N YA N D U : T h a t w o u ld b e s t s e r v e t h e i n t e r e s t … CHAIRPERSON: Hm. M R T H O B A N I T R E V O R M N YA N D U : O f Tr a n s n e t … Page 84 of 116 30 MAY 2019 – DAY 102 CHAIRPERSON: Hm. M R T H O B A N I T R E V O R M N YA N D U : A t le a s t . C H A I R P E R S O N : O k a y. M R T H O B A N I T R E V O R M N YA N D U : A t l e a s t C h a ir i n s o fa r a s fir s tly o r p r i n c i p a lly … CHAIRPERSON: Hm. M R T H O B A N I T R E V O R M N YA N D U : I n r e l a ti o n to t h e a d v ic e t h a t w a s g iv e n i n th e b e g i n n i n g b y P W C … CHAIRPERSON: Hm. 10 M R T H O B A N I T R E V O R M N YA N D U : When th e y said you must in t e r r o g a t e … CHAIRPERSON: Hm. M R T H O B A N I T R E V O R M N YA N D U : O r a s k t h e O E M s t o j u s ti f y t h e ir c o s ts … C H A I R P E R S O N : Ye s . M R T H O B A N I T R E V O R M N YA N D U : A n d w h a t w e u n d e r s t o o d fr o m t h e s e c o n d p a r t o f t h e a d v i c e is th a t is t h a t i f it w a s g o in g t o b e p r o h i b i ti v e … CHAIRPERSON: Hm. 20 M R T H O B A N I T R E V O R M N YA N D U : T h e n y o u s h o u ld s e e k a l t e r n a t iv e m e a s u r e s i n o r d e r t o g o to lo c a t io n s t h a t w o u l d n o t c o s t … CHAIRPERSON: Hm. M R T H O B A N I T R E V O R M N YA N D U : To o m u c h . CHAIRPERSON: H m a n d y o u r i n v e s t ig a t io n s d i d n o t r e v e a l th a t t h a t a d v ic e w a s f o ll o w e d o r t a k e n f u r t h e r i n a n y w a y ? Page 85 of 116 30 MAY 2019 – DAY 102 M R T H O B A N I T R E V O R M N YA N D U : Ye s C h a ir. C H A I R P E R S O N : O k a y, th a n k y o u . A D V M A H L A P E S E L L O : A n d i f I m a y j u s t e n q u ir e a lo n g t h e s a m e li n e s w h e n y o u s t a r t e d w i t h y o u r p r e s e n t a ti o n y o u in d i c a t e d t h a t P W C – I t h i n k y o u s a i d i t w a s – h a d o r y o u t o l d u s a s a f a c t t h a t Tr a n s n e t E n g i n e e r i n g h a d d i ffe r e n t f a c il it i e s . Some in Durban and some in Uitenhage and both were an option – both Durban and Uitenhage were an option? M R T H O B A N I T R E V O R M N YA N D U : Ye s C h a ir. 10 ADV MAHLAPE SELLO: D id y o u fi n d a n y d o c u m e n t a ti o n a s r e g a r d s w h e t h e r o r n o t t h e r e w a s a c o n s id e r a ti o n f o r y o u U it e n h a g e t o s e e i f it m i g h t r e s u l t in c h e a p e r c o s ts t h a n D u r b a n ? M R T H O B A N I T R E V O R M N YA N D U : N o C h a ir b u t i t is – b u t i t i s r e l e v a n t to a ls o p o i n t o u t t h a t h a v in g w e i g h e d o u t th e p r o s a n d c o n s i n r e l a ti o n to t h e s ti m u l a t i o n o f th e e c o n o m y a l o n g t h e c o a s t li n e p a r t ic u l a r r e c o m m e n d a ti o n w a s fir s t ly D u r b a n … A D V M A H L A P E S E L L O : O k a y. M R T H O B A N I T R E V O R M N YA N D U : B u t t h e li n e o f q u e s ti o n i n g a s I u n d e r s t a n d i t C h a ir i s – o k a y – s o i f w e p r o c e e d fr o m th e b a s is t h a t 20 D u r b a n is n o w g o i n g to b e c o s t p r o h i b it i v e i s th e r e a s tu d y t h a t w a s d o n e p u r s u a n t t o th a t i n o r d e r to c o n s id e r a n o t h e r l o c a t i o n . A D V M A H L A P E S E L L O : Ye s . M R T H O B A N I T R E V O R M N YA N D U : Ye s . ADV MAHLAPE SELLO: And … M R T H O B A N I T R E V O R M N YA N D U : N o w e h a v e n o t d i s c o v e r e d s u c h . Page 86 of 116 30 MAY 2019 – DAY 102 A D V M A H L A P E S E L L O : Yo u h a v e n o i n d i c a ti o n t h a t w a s d o n e ? M R T H O B A N I T R E V O R M N YA N D U : N o . A D V M A H L A P E S E L L O : O k a y, t h a n k y o u . M R T H O B A N I T R E V O R M N YA N D U : C h a ir a t s li d e 2 3 h a v in g d e a l t w i t h t h e f a c t t h a t t h e r e w a s ju s t a s i n g l e m e e t i n g t h a t w a s h e l d w e n o w w is h to draw your attention to c r i tic a l c o m m u n ic a t i o n amongst th e n e g o ti a ti n g te a m m e m b e r s w i t h p a r t ic u l a r r e f e r e n c e to v o l u m e 1 3 a t p a g e 9 11 9 … C H A I R P E R S O N : I a m s o r r y. By t h e w a y M r M n y a n d u th e l e a d e r o f t h e 10 n e g o ti a ti o n t e a m o f Tr a n s n e t w a s w h o m ? M R T H O B A N I T R E V O R M N YA N D U : T h e G r o u p C h i e f Ex e c u ti v e – G r o u p C h i e f F in a n c ia l O ffi c e r … C H A I R P E R S O N : Ye s . M R T H O B A N I T R E V O R M N YA N D U : M r A n o j S i n g h . C H A I R P E R S O N : O k a y, th a n k y o u . M R T H O B A N I T R E V O R M N YA N D U : Ye s C h a ir. With p a r tic u la r r e fe r e n c e C h a i r t o v o l u m e 1 3 a t p a g e 9 11 9 . A D V M A H L A P E S E L L O : Ye s . M R T H O B A N I T R E V O R M N YA N D U : W e d r a w y o u r a t t e n t i o n to a n e m a il 20 s e n t b y M r G a r r y P i t a – a p o l o g i e s C h a ir. It is - 9 11 9 is w h e r e t h e a p p e n d ix c o v e r i s . S o w e s h o u l d a c tu a lly g o … C H A I R P E R S O N : Ye s . I t is 9 1 2 0 . I s t h a t r ig h t – 9 1 2 0 ? A D V M A H L A P E S E L L O : Yo u h a v e – i n y o u r s li d e y o u i n d i c a t e t h a t a s A p p e n d i x 11 ? M R T H O B A N I T R E V O R M N YA N D U : Ye s . Page 87 of 116 30 MAY 2019 – DAY 102 A D V M A H L A P E S E L L O : A t 9 11 9 is A p p e n d ix 1 2 . M R T H O B A N I T R E V O R M N YA N D U : O h a p o l o g i e s . A D V M A H L A P E S E L L O : A n d I s e e t h a t i t i s a s tr in g o f t h r e e e m a il s . I f w e s t a r t a t 9 1 2 1 i t is f r o m M s L i n d i w e M d le t s h e to M r Yo u s u f L a h e r. T h a t i s t h e n f o ll o w e d a t 9 1 2 0 w i t h a r e s p o n s e fr o m Mr Yo u s u f L a h e r to M s L i n d iw e M d le ts h e a n d la s t ly a t th e t o p o f 9 1 2 0 i t i s o n c e a g a in fr o m M r Yo u s u f L a h e r t o M s L in d i w e M d l e ts h e . M R T H O B A N I T R E V O R M N YA N D U : Ye s C h a ir. ADV MAHLAPE SELLO: 10 S o is th a t th e – th e – y o u w a n t e d u s t o f i n d t h e e m a i l fr o m M r G a r r y P it a ? M R T H O B A N I T R E V O R M N YA N D U : Ye s C h a ir. My apologies. I t is a c t u a ll y 9 11 7 . A D V M A H L A P E S E L L O : P a g e 9 11 7 ? M R T H O B A N I T R E V O R M N YA N D U : Ye s C h a ir. ADV MAHLAPE SELLO: O k a y. S o i t is t h e p a g e n u m b e r in g o n t h e s li d e t h a t is w r o n g ? M R T H O B A N I T R E V O R M N YA N D U : Ye s C h a ir. A D V M A H L A P E S E L L O : T h a n k y o u . W e h a v e c o r r e c te d t o s e v e n . M R T H O B A N I T R E V O R M N YA N D U : 20 C h a ir a s i s c le a r t h is is a n e m a il fr o m M r G a r r y P i ta s e n t o n 2 0 J u n e 2 0 1 5 a t 1 2 : 0 8 . Th e e m a i l is s e n t t o Mr Thamsanqa Jiyane. It is sent to as well M r A n o j S in g h , M s L i n d iw e M d le ts h e , Mr Yo u s u f L a h e r a n d Mr N d i p h i w e S i li n g a . subject reads “CNR Comments”. The email reads: “Dear all, below fi r s t q u e s t io n s f o r C N R . f in d my comm ents and I h a v e n o t r e c e iv e d t h e B T Page 88 of 116 Th e 30 MAY 2019 – DAY 102 proposal as yet and cannot comment other than w h a t I r a i s e d y e s te r d a y. I a m h e a d i n g o ff to a f a m ily f u n c ti o n a w a y f o r t h e r e s t o f t h e w e e k e n d b u t c a n n o t b e c o n ta c t e d o n m y p h o n e . ” C h a ir w h a t t h e n f o l lo w s a r e th e a c tu a l c o m m e n ts … C H A I R P E R S O N : I – I w o n d e r w h e th e r w h a t w a s m e a n t w a s – b u t c a n b e c o n ta c te d o n m y p h o n e b u t it d o e s n o t s e e m t o … A D V M A H L A P E S E L L O : C o n t e x t u a l th a t is w h a t is s u g g e s te d h e r e . C H A I R P E R S O N : Th e s e n t e n c e d o e s n o t s e e m to – t o – b u t i t is o k a y. 10 T h a t is h i m . T h a t is n o t y o u . M R T H O B A N I T R E V O R M N YA N D U : Ye s C h a ir. C H A I R P E R S O N : Ye s . ADV MAHLAPE SELLO: Before you proceed and deal with the issues t h a t h e r a is e s . Th is i s d a t e 2 0 J u n e 2 0 1 5 ? M R T H O B A N I T R E V O R M N YA N D U : I n d e e d i t is s o C h a ir. A D V M A H L A P E S E L L O : A n d o n th e p r e v i o u s d a y o n 1 9 J u n e t h e r e w a s a m e e t in g w i t h b o t h O E M s ? M R T H O B A N I T R E V O R M N YA N D U : I n d e e d C h a ir. A D V M A H L A P E S E L L O : W a s Mr G a r r y P it a p a r t o f t h a t m e e ti n g ? 20 M R T H O B A N I T R E V O R M N YA N D U : Ye s h e w a s . ADV MAHLAPE SELLO: S o h e w e n t i n t o t h a t n e g o t ia t io n w i t h B T w i t h o u t h a v i n g s e e n t h e B T P r o p o s a l i f t h is e m a il is to b e a c c e p t e d b e c a u s e h e s a y s I h a v e n o t r e c e iv e d t h e B T P r o p o s a l a s y e t ? M R T H O B A N I T R E V O R M N YA N D U : Ye s C h a ir u n l e s s h e w a s r e f e r r i n g t o a r e v is e d p r o p o s a l t h a t o u g h t to h a v e b e e n s e n t o v e r n ig h t . Page 89 of 116 30 MAY 2019 – DAY 102 A D V M A H L A P E S E L L O : O k a y. M R T H O B A N I T R E V O R M N YA N D U : B e c a u s e w e a t l e a s t k n o w fr o m o u r r e c o r d s th a t th e r e w a s B T P r o p o s a l o f A p r i l … A D V M A H L A P E S E L L O : Ye s . M R T H O B A N I T R E V O R M N YA N D U : 2 0 1 5 . A D V M A H L A P E S E L L O : O k a y. M R T H O B A N I T R E V O R M N YA N D U : Going back to A p p e n d ix M r G a r r y P i ta s a y s : “ T h e r e is n o m e n ti o n o f S D o r E D f o r a l l c o n tr a c ts 10 w e n o r m a l ly e i t h e r k e e p th e p e r c e n ta g e o f th e c o n tr a c t v a l u e , t h e S M E … ” W h i c h is n o t u n d e r s t o o d . “ … o r m a k e i t h i g h e r d e p e n d i n g o n th e c h a n g e . I s u g g e s t k e e p i n g it t h e s a m e p e r c e n t a g e o f n o w g r e a t e r c o n tr a c t v a l u e a s t h e c h a n g e w a s c r e a t e d d u e to o u r c h o i c e . Yo u s u f t o c h e c k w h e t h e r t h e r e w e r e a n y c o n ti n g e n c i e s in i n i ti a l o ff e r a s i f th e r e w a s t h e n i t m u s t b e t a k e n in t o a c c o u n t i n t h i s c a l c u l a ti o n . ” 20 T h e r e is a ty p o w e b e li e v e . “ O f th e y k n e w w e w e r e g o in g to s e n d th e m t o D u r b a n s o m a y b e t h e y a lr e a d y p r ic e d s o m e o f t h e r is k in t h e i n i ti a l o ff ic e . G e t l is t o f s u p p li e r s t h e y a r e u s in g i n G a u t e n g a n d t o t a l m a te r i a l t h e y e x p e c t fr o m th e m a s t h e y s a y t h e y a r e m o v in g R 1 .3 b il li o n Page 90 of 116 11 30 MAY 2019 – DAY 102 material but does not make sense as they do not h a v e m a n y s u p p l ie s s e t u p y e t p e r m y i n f o . They n e e d to p r o v e th e 1 .3 b i ll io n e x p e c te d v a l u e . P a g e 3 ta lk s o f li m i t e d m a n u fa c tu r i n g s k ill s a n d e n g in e e r s in th e a r e a b u t t h e p l a n t is s i t u a t e d in B a y h e a d w h e r e t h e r e a r e m a n y m a n u fa c tu r i n g c o m p a n i e s a n d a n a b u n d a n c e o f e n g in e e r s . T h e y a ls o t a lk o f t h e same team having to move to Durban yet charge on a n u m b e r o f o c c a s i o n s f o r m o r e l a b o u r s k i lls b u t 10 t h e y a r e s e n d in g t h e s a m e p e o p l e . S o w h y c h a r g e f o r t h is o n m o r e th a n o n e o c c a s i o n . ” ADV MAHLAPE SELLO: Huh-uh. M R T H O B A N I T R E V O R M N YA N D U : “ R 5 4 . 4 m i lli o n a d d e d s iz e o f t e a m fo r l a b o u r a n d q u a l it y a s s u r a n c e a n d C S T. Tr a n s n e t i n g e n e r a l n e e d to a d v is e i f t h e te a m i n K Z N h a s s u c h l o w s k i ll t o j u s t if y t h is a d d it i o n a l la b o u r f r o m O E M . s ig n if ic a n t. 1 7 8 . 8 m il li o n fo r m a te r i a l is T h e i n fl a to r y p e r c e n ta g e u s e s i s 5 . 5 p e r c e n t w h ic h th e y s a y is C P I . 20 Ye t C P I is 4 . 5 p e r c e n t . A d d i t io n a l ly t h e y s a y t h e y u s e 1 . 8 p e r c e n t p e r m o n t h f o r f o u r m o n t h s w h ic h a d d s t o 7 . 2 p e r c e n t . W h y ? Th e y a l s o s a y i t i s m u l ti p l ie d b y a t o t a l p r o j e c t c o s t. W h y t o ta l p r o j e c t c o s t a n d n o t ju s t t h e m a t e r i a l ? I f i t is m a t e r i a l i t s h o u ld b e 1 . 3 b i ll io n a s p e r p a g e 7 /1 2 . T h is n u m b e r is s u r e l y Page 91 of 116 30 MAY 2019 – DAY 102 o v e r s t a te d b y s o m e m a r g i n . The second part of m a t e r i a l c o s t s b e i n g R 1 6 . 8 m il li o n s t o r a g e w o u l d b e in c u r r e d i f i t w a s D u r b a n o r K D S . ” H e is m e a n t t o d e n o t e K o e d o e s p o o r t . “ S o s h o u l d n o t b e a n a d d i t io n a l c o s t u n l e s s I a m m is s i n g s o m e t h i n g . Te c h n ic a l s u p p o r t in m y m i n d a lr e a d y h a s s o m e c h a n g e i n th e a d d i ti o n a l la b o u r charge for assurance. 10 engineers and a d d i ti o n a l q u a li ty Ye t t h e y c h a r g e R 3 8 . 5 m ill i o n f o r a d d it i o n a l s u p p o r t e s p e c i a l ly fo r m a i n te n a n c e a n d post p r o d u c ti o n . p r o d u c t io n ? Why m a i n te n a n c e and post U n d e r t e c h n ic a l t h e a d d it i o n a l c o s t o f o n s i t e s e r v i c e is h ig h . A g a i n s t th e l is t o f s u p p li e r s a n d h o w th is is b r o k e n u p s e e m s e x c e s s iv e . ” C h a ir - h e th e n g o e s o n t o d e a l w i th tr a n s p o r t a ti o n . I n p a r t ic u l a r in t h e s e c o n d s e n t e n c e o f t h a t l a s t p a r a g r a p h o n 9 11 7 . H e n o t e s : “ T h e c h a r g e R 9 4 .2 m i ll io n f o r a d d i t io n a l tr a n s p o r t a n d a d v is e i t i s f o r 5 5 p e r c e n t l o c a l c o n t e n t . Ye t h e y h a v e 4 5 p e r c e n t i m p o r t e d w h i c h w il l n o t h a v e 20 a n y tr a v e l c o s ts o n c e i t h a s r e a c h e d t h e p o r t . We n e e d th is b e n e fi t b a c k e s t i m a te a s c l o s e R 9 0 m i ll i o n if y o u u s e t h e ir l o g i c . ” Tu r n in g o v e r l e a f a t 9 11 8 . H e t h e n s a y s : “ Yo u s u f t o c h e c k a s s u m p t i o n s t h e y h a v e u s e d p o s s i b ly o r p o s s i b l y P W C l ik e tr a n s p o r t c o s ts , Page 92 of 116 30 MAY 2019 – DAY 102 a v e r a g e C P I , in s u r a n c e c o s ts , s h e lv i n g a n d s t o r a g e p e r m ² c o s t s w h ic h s e e m e x tr e m e ly e x c e s s i v e . Tr a n s p o r t a l s o i n c l u d e l o c a l t e s t in g f o r 1 . 8 m il li o n b u t w h a t i s t h e a d d i ti o n a l c o s t th a t w o u l d n o t h a v e been incurred in Koedoespoort. Wa r e h o u s in g : Tr a n s n e t E n g in e e r i n g t o c h e c k t h i s a s I r e c a l l t h e m a s k in g Tr a n s n e t E n g in e e r i n g w a r e h o u s i n g i n i n i ti a l b id . to do what S o i f th e y a r e c h a r g i n g e x tr a t h e n … ” 10 I b e li e v e i t is a ty p o . “ E i g h t s h o u ld c h a r g e t h e m e x tr a b e d o n t h e ir n u m b e r s l ik e R 5 5 p e r m ² v e r s u s R 3 5 p e r m ² i n K o e d o e s p o o r t w h i c h s e e m s e x c e s s iv e a n d n e e d s t o be checked. T h e y a l s o c h a r g e fo r f e n c in g a n d s e c u r i ty a n d o ffi c e f u r n it u r e . W h y is t h a t a d d it i o n a l over Koedoespoort? S a m e g o e s w i t h a d d it i o n a l tr u c k s a n d fo r k l i ft s . Why more in Durban versus K o e d o e s p o o r t fo r th e s a m e w o r k ? Does not make s e n s e . U n d e r w a r e h o u s i n g R 11 2 0 0 m ² f o r s h e l v i n g 20 a n d s t o r a g e is r i d ic u lo u s a n d i m p o s s i b l e . fi x t h i s . Need to A g a i n th e y c h a r g e f o r a d d i ti o n a l o f 9 0 u n d e r w a r e h o u s in g c o s ts o f 2 5 – 2 4 . 5 m i lli o n p lu s R 5 . 8 m i ll io n f o r e n g in e e r s . ti m e they Yo u s u f to are charging check T h is is n o w t h e t h ir d for fi n a n c i n g a d d i ti o n a l c o s ts Page 93 of 116 and people. hedging 30 MAY 2019 – DAY 102 numbers. Al s o in d u s tr y s t a n d a r d f o r tr a i n i n g is 3 p e r c e n t n o t 6 p e r c e n t . S o 3 . 6 m il li o n i s o v e r s t a t e d . C o n ti n g e n c y m u s t b e t a l k e d a b o u t . T h i s is fix e d p r i c e . R e g a r d s , G a r r y. ” A D V M A H L A P E S E L L O : Ye s . M R T H O B A N I T R E V O R M N YA N D U : Ye s . C h a ir t h o s e a r e n u m e r o u s c o n c e r n s , a t t a c k s a n d r e q u e s ts f o r c l a r i f ic a ti o n s t h a t M r G a r r y P i t a h a d . ADV MAHLAPE SELLO: And not in significant concerns one may say? M R T H O B A N I T R E V O R M N YA N D U : A n d n o t i n s ig n i f ic a n t c o n c e r n s o n e 10 m u s t a d d e s p e c i a l ly w h e n o n e h a s r e g a r d to t h e a m o u n t s t h a t M r G a r r y P i ta is a t t a c k in g or seeking c l a r i f ic a ti o n in respect of throughout the email correspondence. ADV MAHLAPE SELLO: Huh-uh. M R T H O B A N I T R E V O R M N YA N D U : C h a ir w e w o u l d n o w l ik e to t a k e y o u t o A p p e n d ix 1 2 w h i c h is to b e f o u n d o n p a g e 9 1 2 0 … A D V M A H L A P E S E L L O : Ye s . M R T H O B A N I T R E V O R M N YA N D U : O f v o l u m e 1 3 . A D V M A H L A P E S E L L O : Ye s . M R T H O B A N I T R E V O R M N YA N D U : 20 O n – h a l fw a y th r o u g h th e p a g e o f 9 1 2 0 a n d o n 2 1 J u n e t h e C h a ir w i ll r e c a l l t h a t M r Yo u s u f L a h e r w a s r e q u e s t e d t o c h e c k a n u m b e r o f t h i n g s b y M r G a r r y P i ta o n th e p r e v i o u s d a y. H e s e n d th e e m a i l a n d h e s a y s : “ D e a r a ll , m y c o m m e n ts a s fo ll o w s : i n c r e a s i n g th e t e a m s iz e d o e s n o t m a k e s e n s e c o n s i d e r i n g t h e le a r n i n g c u r v e w il l m it i g a t e th is r e q u ir e m e n t w i t h i n Page 94 of 116 30 MAY 2019 – DAY 102 a short time. e l i m in a t e Tw o , n e g o ti a ti n g w i t h s u p p l ie r s w i ll the i n fl a t o r y a d d it i o n a l m o n t h s . c o s ts r e l a te d to fo u r I n a n y c a s e m a t e r ia l c o s ts g e n e r a l ly d o n o t i n c r e a s e o n a m o n t h l y b a s i s t h u s t h e i m p a c t s h o u ld n o t b e a s la r g e a s 1 .8 p e r c e n t . A ls o 1 . 8 p e r c e n t f o r f o u r m o n t h s d o e s n o t e q u a l 5 . 5 percent but rather 7.2 percent which is excessive. Three, from the e x p l a n a ti o n provided the in c r e m e n t a l c o s t o f p r o c u r e m e n t d o e s n o t r e l a te to 10 the move to Durban. T h i s s h o u ld n o t b e c h a r g e d . I n a n y c a s e 9 p e r c e n t in t e r e s t is e x c e s s i v e . F o u r, t h e a d d i t io n a l te c h n i c a l s u p p o r t r e q u ir e m e n t i n Durban does not make sense. The cost of this t e c h n ic a l s u p p o r t s h o u l d h a v e b e e n i n c l u d e d i n th e o r i g in a l p r ic e . F iv e , o n s i te s e r v ic e b y t e c h n ic i a n s s h o u l d h a v e b e e n in c l u d e d i n th e o r i g i n a l p r ic e . R31.5 m il li o n e x c e s s iv e . for tr a v e l and r e l o c a ti o n seems S i x , c a n th e tr a n s p o r t n o t b e d o n e b y T F R v i a r a il c o n t a i n e r s ? I f s o t h e n i n s u r a n c e c o s t s 20 w o u ld a l s o b e a m i n i m u m w a s w o u l d b e in t e r n a ll y in s u r e d . S e v e n , R 11 2 0 0 p e r m ² f o r s h e l v i n g s e e m s e x c e s s iv e . S C S c a n r e s e a r c h th is . E ig h t , h a s c o n s i d e r a ti o n b e e n g iv e n to T P … ” W h i c h is Tr a n s n e t Pr o p e r t y C h a ir. “…or Tr a n s n e t Fr e i g h t Rail P r o p e r ty Page 95 of 116 for th e 30 MAY 2019 – DAY 102 warehousing? N i n e , w h y t h e a d d i ti o n a l fo r k l i ft s ? 1 0 , h o w m u c h is t h e i n c e n t iv e a n d r e l o c a ti o n c o s t p e r s t a ff m e m b e r ? 11 , la b o u r in f la t io n d o e s n o t in c r e a s e o n a m o n t h ly b a s i s . The impact could p o s s i b ly o n ly b e a t t h e e n d o f th e p r o j e c t . 12, la b o u r in f la t io n r a te a p p li e d a t 5 . 5 p e r c e n t f o r th e f u ll y e a r w h e r e a s i t s h o u l d o n ly b e f o r f o u r m o n t h s . ( Se ll E 2 3 a n d s t a ff s h e e t) . ” T h e 1 3 t h a r e a o f c o n c e r n is : 10 “ T h e a d d i t io n a l c o s t t o r o l l o v e r t h e h e d g e m u s t b e c h e c k e d b y Tr e a s u r y. ” T h i s p o i n t w e a r e t o u n d e r s t a n d th a t w o u l d b e Tr a n s n e t Tr e a s u r y. “ 1 4 , a d d it i o n a l b o n d c o s ts m u s t b e c h e c k e d b y Tr e a s u r y. 1 5 , c o n t in g e n c y r is k o f 4 p e r c e n t a n d r is k p r o v i s i o n o f 9 p e r c e n t is u n e x p la i n e d a n d s e e m s t o b e a d d i t io n a l p r o f it . T h is s e e m s e x c e s s iv e . 16, o b t a i n a d e ta il e d l is t o f s u p p li e r s b e in g u s e d i n D u r b a n v e r s u s t h o s e in J o h a n n e s b u r g . T h e c o s t o f t h e l o n g t e r m m a i n te n a n c e c o n s u l t in g d o e s n o t 20 r e l a t e t o t h e m o v e t o D u r b a n ( s e l l E 2 9 s t a ff) . T h is s h o u l d n o t b e c h a r g e d a s i t s h o u ld h a v e b e e n in c l u d e d in the o r ig i n a l c o n t r a c t . in fl a ti o n is d o u b l e d ( R e f : 18, labour s e ll D 7 a n d s e l l E 2 3 “s t a ff ”) . B e s t r e g a r d s , Yo u s u f L a h e r. ” ADV MAHLAPE SELLO: S o o n 2 0 J u n e M r Pi t a r a is e s a – a r a n g e o f Page 96 of 116 30 MAY 2019 – DAY 102 concerns. M R T H O B A N I T R E V O R M N YA N D U : I n d e e d C h a ir. ADV MAHLAPE SELLO: R e g a r d in g t h e c o m p u ta t io n o f c o s ts b y th e OEMs? M R T H O B A N I T R E V O R M N YA N D U : I n d e e d C h a ir. ADV MAHLAPE SELLO: And request Mr Laher to do some c a l c u l a ti o n s ? M R T H O B A N T R E V O R M N YA N D U : I n d e e d C h a ir. ADV MAHLAPE SELLO: 10 Th is e m a il y o u h a v e j u s t r e a d d o e s n o t n e c e s s a r i ly s e e m t o s u g g e s t t h a t M r Yo u s u f L a h e r w a s d e a l i n g d ir e c tl y w i t h th e c o n c e r n s r a is e d b y Mr P i t a b u t i n s t e a d i t a p p e a r s t o m e – a t le a s t – t o b e M r L a h e r r a is i n g h is o w n s e t o f c o n c e r n s ? M R T H O B A N I T R E V O R M N YA N D U : I n d e e d i t is s o C h a ir. A D V M A H L A P E S E L L O : O k a y. T h e n w h a t tr a n s p ir e s n e x t ? M R T H O B A N I T R E V O R M N YA N D U : C h a i r w h a t t h e n tr a n s p ir e s n e x t is t h a t o n 2 3 J u n e M s L in d i w e M d l e ts h e s h a r e d v ia e m a i l a n d th e e m a i l is b e f o u n d a t A p p e n d ix 1 3 . T h a t is v o l u m e 1 3 p a g e 9 1 2 2 . I t w il l b e 9 11 – 9 1 2 3 C h a ir. A D V M A H L A P E S E L L O : Ye s . 20 M R T H O B A N I T R E V O R M N YA N D U : C h a ir i n o r d e r t o f o l lo w th e e m a il c h a i n p r o p e r l y w e n e e d t o r e a d t h e o n e th a t is a t t h e b o t to m f ir s t . M s L i n d iw e M d le ts h e s e n d s t h e e m a il a n d s a y s … ADV MAHLAPE SELLO: S o r r y M r M n y a n d u t h e - th e m ic – y o u r v o ic e is … M R T H O B A N I T R E V O R M N YA N D U : A p o l o g i e s C h a ir. Page 97 of 116 30 MAY 2019 – DAY 102 A D V M A H L A P E S E L L O : ( I n te r p r e t e r ) . M R T H O B A N I T R E V O R M N YA N D U : The email fr o m M s L i n d iw e M d le ts h e r e a d s : “Good d a y, p le a s e f in d attached revised Proposal for your review and comments. CNR Please n o t e t h a t b o th m e e ti n g s t h a t w e r e s c h e d u l e d t o t a k e p l a c e t o d a y – 2 3 J u n e 2 0 1 5 – w e r e p o s tp o n e d . B Ts P r o p o s a l is s t il l o u ts t a n d i n g . Th e y a r e h a v i n g a n a l ig n m e n t s e s s i o n th is a f t e r n o o n a n d t h e y w i ll r e v e r t b a c k t o u s to d a y w it h a n i n d ic a ti o n o n w h e n 10 t h e r e v is e d p r o p o s a l w il l b e s u b m it t e d t o Tr a n s n e t . ” Then it says: “Kind regards.” C h a ir w e t h e n g o to th e m id d l e s e c ti o n o f t h e – o f t h e p a g e . T h e e m a i l is s e n t b y M r Yo u s u f L a h e r to b e i n r e s p o n s e t o M s L in d i w e M d l e ts h e . He says: “Hi Lindiwe …” CHAIRPERSON: And that is 25 June? M R T H O B A N I T R E V O R M N YA N D U : 2 5 J u n e 2 0 1 5 . 20 CHAIRPERSON: Ja. M R T H O B A N I T R E V O R M N YA N D U : W h i c h is t w o d a y s a f t e r th e e m a i l fr o m M s M d l e ts h e . T h e e m a i l r e a d s : “ H i L i n d i w e , t h e ir p r o p o s a l h a s n o t c h a n g e d fr o m t h e p r e v i o u s s u b m is s i o n e x c e p t fo r th e ir n e w o ff e r on payment terms. A s s u c h t h e c o m m e n t s p e r my Page 98 of 116 30 MAY 2019 – DAY 102 e m a i l o v e r t h e w e e k e n d w o u l d s ti ll a p p l y. T h e ir p a y m e n t t e r m s o ffe r n e e d s t o b e c o n s i d e r e d i n li g h t o f Tr a n s n e t c a s h f lo w s i tu a ti o n fo r w h i c h Tr e a s u r y must advice.” C h a ir o n o u r i n v e s ti g a ti o n 2 0 J u n e 2 0 1 5 w a s a Fr i d a y w h ic h w a s w h e n M r G a r r y P i ta s e n t h is e m a i l . Th e r e s p o n s e fr o m M r Yo u s u f L a h e r w a s o n t h e 2 1 s t b e in g a S a t u r d a y a n d t h e r e f o r e w h e n h e r e f e r s o n 2 5 J u n e t o a n e m a il o v e r th e w e e k e n d h e i s r e fe r r in g t o A p p e n d ix 1 2 w h i c h w e h a v e ju s t c o n s i d e r e d . 10 A D V M A H L A P E S E L L O : O k a y. M R T H O B A N I T R E V O R M N YA N D U : b e s il e n c e . C h a ir t h e r e – t h e r e th e n s e e ms t o T h e r e is a b r e a k i n c o m m u n i c a t io n i n s o fa r a s e m a il c o r r e s p o n d e n c e s b e t w e e n t h e Tr a n s n e t R e lo c a ti o n N e g o ti a ti n g Te a m u p u n t il 1 0 J u ly. C H A I R P E R S O N : A n d s o f a r w e h a v e n o t s e e n a n y c o m m e n t s f o ll o w i n g t h a t m e e ti n g – t h o s e t w o m e e t in g s a t - I t h i n k y o u s a i d O R Ta m b o . Yo u h a v e n o t s e e n a n y c o m m e n ts fr o m t h e s e n i o r p e o p l e i n t h e t e a m Mr Anoj Singh … M R T H O B A N I T R E V O R M N YA N D U : I n d e e d C h a ir. 20 C H A I R P E R S O N : Fo r e x a m p le . O k a y, a lr i g h t. M R T H O B A N I T R E V O R M N YA N D U : I n d e e d C h a ir. A d d i t io n a l ly w e h a v e n o t s e e n a n y e m a il c o r r e s p o n d e n c e s s e n t t o Tr a n s n e t E n g in e e r i n g f o r them … C H A I R P E R S O N : Ye s . M R T H O B A N I T R E V O R M N YA N D U : To c h e c k t h e c o n s i d e r a t io n s o f th e Page 99 of 116 30 MAY 2019 – DAY 102 team – concerns of the team members. C H A I R P E R S O N : Ye s . M R T H O B A N I T R E V O R M N YA N D U : Nor has there been any c o r r e s p o n d e n c e s s e n t t o Tr a n s n e t ’s Tr e a s u r y D e p a r t m e n t f o r t h e m t o v a l i d a t e a m o n g s t o th e r t h i n g s … CHAIRPERSON: Hm. M R T H O B A N I T R E V O R M N YA N D U : T h e a d d i ti o n a l b o n d s t h a t a r e r e q u ir e d a n d w h e t h e r th e y w o u l d b e a c c e p t a b le . N o r h a v e w e s e e n a n y c o r r e s p o n d e n c e s s e n t t o th e Tr a n s n e t P r o p e r t y D iv is i o n w h ic h w o u l d b e 10 c o n s i d e r e d f o r i t e m s li k e w a r e h o u s in g i n a d i ff e r e n t lo c a t io n . ADV MAHLAPE SELLO: Hm. C H A I R P E R S O N : Ye s . M R T H O B A N I T R E V O R M N YA N D U : C h a ir a s w e s a y s li d e 2 7 – t h e r e t h e n s e e m s to b e a b r e a k i n c o m m u n ic a t io n u p u n ti l 1 0 J u ly 2 0 1 5 o n w h ic h d a t e b e g i n n i n g s t h e p r o c e s s to fi n a l i s e th e r e l o c a ti o n c o s ts . ADV MAHLAPE SELLO: And so we M r Yo u s u f L a h e r ’s c o m m u n ic a ti o n of last just are clear f o ll o w i n g 25 June reminding M s M d l e ts h e th a t th e is s u e s I r a i s e d r e m a i n o u t s t a n d i n g . I have not r e c e i v e d a n a n s w e r t h e r e to – t h e r e o n a n d M r G a r r y P i ta ’s o w n c o n c e r n s 20 a s r e fl e c t e d i n t h e e m a i l y o u r e a d i n to t h e r e c o r d a n d t h a t p e r i o d 2 3 J u n e to t h e d a t e y o u s a y 1 0 J u ly 2 0 1 5 fi n a l is a ti o n b e g i n s . I s th e r e any record of at least Mr Garry Pita been addressed on the concerns t h a t h e r a is e d ? M R T H O B A N I T R E V O R M N YA N D U : N o t h e r e i s n o t C h a ir. ADV MAHLAPE SELLO: A n d I – s i m i la r ly I ’l l t a k e it n e i th e r a r e Mr Page 100 of 116 30 MAY 2019 – DAY 102 Yu s u f L a h e r ’s c o n c e r n s r a is e d ? M R T H O B A N I T R E V O R M N YA N D U : N o th e r e is n ’ t C h a ir, p a r ti c u la r ly in r e s p e c t o f h i m , t h e r e is n ’ t a r e s p o n s e t o th e m a i l o f 2 5 J u n e . A D V M A H L A P E S E L L O : W h ic h r e m i n d s th e m o f t h e e a r li e r e m a i l w h e r e he set out these concerns. M R T H O B A N I T R E V O R M N YA N D U : Ye s C h a ir. A D V M A H L A P E S E L L O : Ye s . CHAIRPERSON: A n d d i d y o u c o m e a c r o s s a n y s u g g e s ti o n t h a t t h e r e w a s a m e e ti n g o f t h e m e m b e r s o f th e Tr a n s n e t n e g o t ia t in g t e a m w h e r e 10 t h e y d is c u s s e d t h e w a y f o r w a r d in t h e l i g h t o f th e c o n c e r n s t h a t h a d b e e n r a is e d p r i o r t o t a lk in g a b o u t f i n a lis i n g th e a g r e e m e n t? M R T H O B A N I T R E V O R M N YA N D U : N o C h a ir w e w e r e n o t a b le t o c o m e a c r o s s a n y r e c o r d t h a t d e m o n s tr a te s a m e e ti n g h a v i n g ta k e n p l a c e . C H A I R P E R S O N : A n d to w h a t e x te n t a r e y o u a b l e t o s a y t h a t t h e e m a i ls to w h ic h you have referred exchanged among members of th e n e g o ti a ti n g te a m , t o w h a t e x t e n t a r e y o u a b l e t o s a y t h a t t h o s e t o w h ic h y o u h a v e r e f e r r e d a r e b a s i c a ll y t h e o n ly o n e s t h a t w e r e e x c h a n g e d a m o n g t h e m e m b e r s o f t h e n e g o t ia t in g t e a m o f Tr a n s n e t i n r e g a r d to t h e s e n e g o ti a ti o n s a f t e r m e e ti n g w it h th e t w o e n ti ti e s ? 20 M R T H O B A N I T R E V O R M N YA N D U : C h a ir i t is p iv o t a l a t t h i s p o i n t to r e c o r d t h a t t h e e m a i l c o r r e s p o n d e n c e s w e ’v e g o t w e r e r e c e iv e d fr o m Tr a n s n e t d i r e c t ly, i t is a ls o i m p o r t a n t to r e c o r d t h a t w e a ls o h a v e h a d a c c e s s t o Tr a n s n e t ’s s e r v e r. It i s p o s s ib l e in c e r t a i n in s ta n c e s w h e r e t h e s u b je c t o f a p a r tic u la r e m a il d o e s n o t i n d ic a te t h a t w h ic h i s d is c u s s e d i n t h e e m a il a n d th e r e f o r e y o u w o u l d n o t b e a b l e t o fi n d i t Page 101 of 116 30 MAY 2019 – DAY 102 b u t i n s o f a r a s o u r s e a r c h e r s o n t h e s e r v e r h a v e c o n f ir m e d t h e r e w e r e n o f u r t h e r e n g a g e m e n ts in r e la t io n to t h e s e is s u e s . C H A I R P E R S O N : B u t y o u s a y t h e r e m i g h t b e s o m e p o s s i b i li ty t h a t y o u m i g h t h a v e m i s s e d s o m e if t h e s u b je c t d i d n ’ t … ( i n te r v e n t io n ) . M R T H O B A N I T R E V O R M N YA N D U : C h a ir w h a t I’ m tr y i n g t o c la r i fy i s t h a t i n s o f a r a s o u r s e a r c h e s h a v e g o n e o n t h e t w o O E M ’s b e i n g c o n c e r n e d th e r e w e r e n o f u r th e r e n g a g e m e n ts . C H A I R P E R S O N : I’ m t a lk i n g a b o u t c o m m u n ic a ti o n a m o n g t h e m e m b e r s o f t h e Tr a n s n e t n e g o t i a t i n g te a m in r e g a r d t o th e ir n e g o t ia t io n s w i t h t h e 10 t w o O E M ’ S . To w h a t e x te n t – t h e s e e m a il s t o w h i c h y o u h a v e r e f e r r e d c o u l d b e s a i d t o b e t h e o n ly o n e s t h a t w e r e e x c h a n g e d a m o n g t h i s te a m t o s a y, w h a t a r e w e g o in g t o d o w i th t h e p r o p o s a ls fr o m t h e s e e n t it i e s ? M R T H O B A N I T R E V O R M N YA N D U : P e r h a p s C h a ir, i n o r d e r t o a s s is t t h e C o m m i s s i o n in t h is r e g a r d o n e c a n r e c o l l e c t t h a t w h e n M s L in d iw e M d le t s h e w a s i n t e r v i e w e d a n d s h e w a s q u e s ti o n e d a b o u t th e s t e p s t h a t n e e d e d t o b e ta k e n i n s o f a r a s t h e c o m m e n ts , i n p a r t ic u l a r, o f Mr Yu s u f L a h e r a r e c o n c e r n e d , h e r r e s p o n s e w a s , M r Yu s u f L a h e r i n a n y e v e n t w a s n o t p a r t o f t h e n e g o t i a t i o n t e a m . S o t h a t g i v e s th e in d i c a t i o n t h a t I , a s L i n d i w e M d le ts h e d i d n o t n e e d t o t a k e h is c o n c e r n o r c o n c e r n s 20 s e r io u s ly. S o t h a t , t o g e t h e r w i th o u r s e a r c h e s a n d t h e i n v e s t ig a ti o n s c o n d u c t e d t h e r e f o r e l e a d s o n e t o t h e c o n c l u s i o n th a t t h e r e w e r e n o f u r th e r e n g a g e m e n ts . CHAIRPERSON: B u t i n s o f a r a s , t h r o u g h t e c h n ic a l m e a n s o f w h ic h I k n o w n o t h i n g t h a t i n v e s t ig a to r s w o u l d k n o w, t h e ir c o m p u te r s w e r e checked to see that r e a l ly there was Page 102 of 116 – there were no o th e r 30 MAY 2019 – DAY 102 c o m m u n ic a ti o n s th a t y o u m i g h t h a v e m i s s e d . M R T H O B A N I T R E V O R M N YA N D U : Ye s C h a ir CHAIRPERSON: Ye s , s o y o u fe e l q u i t e c o n fi d e n t th a t th e r e p r o b a b ly w e r e n o o t h e r e m a il s e x c h a n g e d a m o n g th e m ? M R T H O B A N I T R E V O R M N YA N D U : I n d e e d C h a ir. C H A I R P E R S O N : Ye s o k a y t h a n k y o u . ADV MAHLAPE SELLO: A t l e a s t – o r t h r o u g h Tr a n s n e t s e r v e r s ? M R T H O B A N I TR E V O R M N YA N D U : A t l e a s t n o t t h r o u g h Tr a n s n e t servers. 10 C H A I R P E R S O N : Ye s b u t o f c o u r s e it w o u l d b e s t r a n g e i f i t w a s t h r o u g h o th e r s e r v e r s is n ’ t it ? M R T H O B A N I T R E V O R M N YA N D U : S t r a n g e , y e s C h a ir. C H A I R P E R S O N : B e c a u s e t h i s w a s b u s i n e s s – t h is w a s w o r k r e l a t e d . M R T H O B A N I T R E V O R M N YA N D U : I n d e e d . C H A I R P E R S O N : O k a y, a lr ig h t . ADV MAHLAPE SELLO: T h a n k y o u th e n y o u ’ v e t a k e n u s n o w to t h e d a t e o f 1 0 t h J u ly 2 0 1 5 …( in t e r v e n ti o n ) . CHAIRPERSON: I’ m s o r r y l e t – j u s t b e f o r e th a t , u n le s s th e y h a d a m e e ti n g , t h a t I t h e Tr a n s n e t n e g o ti a ti n g t e a m , u n le s s t h e y h a d a 20 m e e ti n g t o w h ic h t h e y m a d e n o r e f e r e n c e i n e m a ils a m o n g t h e m s e lv e s t o s a y, l e t ’s h a v e a m e e ti n g . U n l e s s th e y h a d a m e e ti n g t o w h ic h t h e y m a d e n o r e f e r e n c e i n e m a il s , t h e n i t w o u l d l o o k l ik e t h e y w e n t i n to fi n a l is i n g t h e a g r e e m e n t w i t h o u t h a v i n g h a d a n o t h e r m e e ti n g to t a lk a m o n g th e m s e lv e s o r t o h a v e a n e x c h a n g e o f i d e a s th r o u g h e m a i ls to s a y, h o w d o w e a p p r o a c h t h is , d o w e h a v e c o n c e r n s , h o w d o w e Page 103 of 116 30 MAY 2019 – DAY 102 address concerns that have been raised. M R T H O B A N I T R E V O R M N YA N D U : Ye s C h a ir. C H A I R P E R S O N : A n d t h a t w o u ld b e q u i t e s tr a n g e . M R T H O B A N I T R E V O R M N YA N D U : S t r a n g e C h a ir. C H A I R P E R S O N : Ye s . ADV MAHLAPE SELLO: And if, on that score, I may then refer you b a c k t o 9 1 2 3 , th e e m a il fr o m M s L i n d i w e M d le t s h e o f 2 3 J u n e 2 0 1 5 , a t t h e b o t t o m , t h e b o t t o m e m a il a t 9 1 2 3 , s h e s t a te s t o th e a d d r e s s e e s , “ p l e a s e n o t e t h a t b o t h m e e ti n g s t h a t w e r e s c h e d u l e d t o t a k e 10 p l a c e to d a y 2 3 J u n e w e r e p o s t p o n e d ” . Yo u s e e t h a t? M R T H O B A N I T R E V O R M N YA N D U : I n d e e d C h a ir. ADV MAHLAPE SELLO: F ir s t q u e s ti o n , d o y o u k n o w w h a t t h e s e m e e ti n g s w e r e , t h e s e m e e ti n g s w e r e t h e y O E M ’s o r p r e s u m a b ly m e e ti n g s o f t h e n e g o ti a ti n g t e a m . M R T H O B A N I T R E V O R M N YA N D U : I a m – w e a r e u n a b l e to c la r i fy C h a ir, s a v e t o s t a t e i n o u r s e a r c h e s a g a in o n th e s e r v e r, t h e s e m e e ti n g s h a d n o t b e e n d is c u s s e d e a r li e r, s o i t m i g h t h a v e b e e n that t h e y w e r e a r r a n g e d b y o th e r m e a n s o t h e r th a n b y w a y o f e m a i l 20 c o m m u n ic a ti o n . ADV MAHLAPE SELLO: A n d b a s e d o n y o u r r e s p o n s e s to t h e C h a i r ’s q u e s t io n s , I t a k e i t th a t u p u n t il 1 5 t h J u n e – 1 5 t h J u ly t h o s e m e e t i n g s w e r e n o t h e l d a s t h e y w e r e p o s tp o n e d fr o m t h e 2 3 r d o f J u n e s o t h e y w e r e p o s t p o n e d o n th e 2 3 r d o f J u n e a n d I ta k e p o s t p o n e m e n t t o m e a n t h e y s h a ll b e h e l d o n a d i ff e r e n t d a te . Page 104 of 116 30 MAY 2019 – DAY 102 M R T H O B A N I T R E V O R M N YA N D U : Ye s C h a ir. A D V M A H L A P E S E L L O : A n d y o u a r e s u g g e s ti n g t h a t a t l e a s t w h a t e v e r t h a t d a t e m a y b e i t w a s n o t b e f o r e t h e 1 5 t h o f J u ly, t h e r e ’s n o r e c o r d o f t h o s e m e e ti n g s b e in g h e l d b e fo r e t h e 1 5 t h o f J u ly ? ? M R T H O B A N I T R E V O R M N YA N D U : C h a ir b e f o r e th e 1 0 t h o f J u ly. A D V M A H LA P E S E L L O : B e f o r e t h e 1 0 t h o f J u ly, m y a p o l o g i e s , 1 0 t h o f J u l y. M R T H O B A N I T R E V O R M N YA N D U : Ye s C h a ir. A D V M A H L A P E S E L L O : S e c o n d ly w e h a v e h e a r d f r o m a f e w w i tn e s s e s 10 a s w e l l a s M r S e d u m e d i , i t s e e m s c o m m o n p r a c t ic e t h a t w h e n t h e s e m a t t e r s a r e c o n s i d e r e d i n Tr a n s n e t, t e n d e r r e l a t e d a n d p r o p o s a l s a r e s u b m i tt e d f o r e v a l u a t i o n t h a t a c r o s s - f u n c t io n e v a lu a t io n t e a m is e i th e r a p p o i n t e d o r s o m e e v a lu a ti o n t e a m is a p p o i n t e d , w h a t e v e r it m a y b e c a l l e d a n d a t t h e c o n c lu s i o n o f w h a t e v e r t h e ir m a n d a t e is , th e y p r o d u c e a report. M R T H O B A N I T R E V O R M N YA N D U : I n d e e d C h a ir. ADV MAHLAPE SELLO: D i d w e h a v e a c r o s s - f u n c t i o n a l e v a l u a t io n t e a m i n r e s p e c t o f t h e s e r e l o c a ti o n p r o p o s a ls ? M R T H O B A N I T R E V O R M N YA N D U : N o w e d i d n o t C h a ir. 20 ADV MAHLAPE SELLO: S o w e o n ly h a d t h e n e g o ti a ti n g t e a m a s y o u lis t e d t h e r e . M R T H O B A N I T R E V O R M N YA N D U : C o r r e c t C h a ir. A D V M A H L A P E S E L L O : D i d th e n e g o ti a ti n g t e a m p r o d u c e a r e c o r d – a r e p o r t o n t h e ir n e g o ti a ti o n s w i t h b o th B o m b a r d ie r a n d C N R ? M R T H O B A N I T R E V O R M N YA N D U : T h e r e is n ’t a r e c o r d o f s u c h a Page 105 of 116 30 MAY 2019 – DAY 102 r e p o r t C h a ir. A D V M A H L A P E S E L L O : D i d y o u e n q u ir e a b o u t o n e ? M R T H O B A N I T R E V O R M N YA N D U : W e d i d e n q u ir e a b o u t o n e w h e n one supposes or rather has regard to the fact that there is a report or a d r a f t r e p o r t f r o m t h e Tr a n s n e t I n t e r n a l A u d i t Te a m , i n r e s p e c t o f w h ic h w e ’l l g e t t o s h o r tly, a n d w e w e r e t o l d t h e r e w a s n ’t s u c h a r e p o r t prepared. ADV MAHLAPE SELLO: Was a reason advanced for why one wasn’t prepared? 10 M R T H O B A N I T R E V O R M N YA N D U : N o C h a ir. ADV MAHLAPE SELLO: A n d i n th is r e g a r d w h o d i d y o u h a v e d is c u s s io n w i t h , w h o s o a d v i s e d y o u ? M R TH O B A N I T R E V O R M N YA N D U : I t w a s fir s t ly M r Yu s u f L a h e r a n d t h e s e c o n d ly M s L i n d i w e M d le t s h e . ADV MAHLAPE SELLO: Thank you. CHAIRPERSON: much discussion S o y o u r i n v e s t ig a ti o n s d i d n o t r e v e a l t h a t t h e r e w a s around the Tr a n s n e t n e g a ti o n team on th e i r n e g o ti a ti o n s w i t h t h e s e t w o e n t i ti e s o n t h i s v e r y h i g h a m o u n ts t h a t w e r e s u p p o s e d to b e lo o k e d i n to . 20 M R T H O B A N I TR E V O R M N YA N D U : C h a ir c a n y o u p l e a s e a s k t h e q u e s t io n a g a in . ADV MAHLAPE SELLO: Yo u r in v e s t i g a t io n s it w o u l d s e e m d i d n o t r e v e a l th a t t h e r e w a s m u c h d is c u s s i o n a m o n g th e Tr a n s n e t n e g o ti a ti n g t e a m o n th e s e p r o p o s a l s t h a t c a m e fr o m t h e s e t w o e n ti t ie s . M R T H O B A N I T R E V O R M N YA N D U : Ye s C h a ir. Page 106 of 116 30 MAY 2019 – DAY 102 CHAIRPERSON: I n d e e d y o u f o u n d n o t h in g th a t s u g g e s t e d th a t th e n e g o ti a ti o n t e a m o f Tr a n s n e t i n t e r r o g a t e d th e s e a m o u n ts i n a n y w a y – in a n y s e r i o u s w a y. MR TH O B A N I TREVOR M N YA N D U : O th e r th a n the email c o r r e s p o n d e n c e s t h a t w e ’v e ju s t r e f e r r e d t o C h a ir, w e w e r e n o t a b le t o fi n d s u c h c o m m u n i c a t io n s . C H A I R P E R S O N : A n d o f c o u r s e in r e g a r d t o o n e , I t h in k M s S e ll o s a i d M s M d l e ts h e s a i d M r L a h e r w a s n o t e v e n p a r t o f th e n e g o ti a ti o n t e a m . M R T H O B A N I T R E V O R M N YA N D U : Ye s C h a ir. 10 A D V M A H L A P E S E L L O : E x c e p t C h a ir t h a t w a s s a i d b y M r M n y a n d u n o t M s S e l lo , I w o u l d n ’ t h a v e k n o w n – I w o u l d n ’t h a v e t h a t k n o w l e d g e . CHAIRPERSON: I thought you were referring to some e m a i l … ( i n te r v e n t io n ) . A D V M A H L A P E S E L L O : H e s a i d t h a t a r o s e d u r in g th e i n t e r v ie w y e s . C H A I R P E R S O N : O k a y n o , M r M n y a n d u n o t Ms S e ll o . A D V M A H L A P E S E L L O : T h a n k y o u C h a ir. CHAIRPERSON: S o o k a y I g u e s s w e ’ ll g e t t o t h e p o i n t w h e r e , u l ti m a t e ly, n o w t h e y a g r e e to s o m e t h i n g . M R T H O B A N I T R E V O R M N YA N D U : 20 A g r e e d C h a ir. C H A I R P E R S O N : Ye s . ADV MAHLAPE SELLO: W h ic h is a t o p ic y o u s ta r t n o w o n y o u r s li d e 27. M R T H O B A N I T R E V O R M N YA N D U : W h i c h i s a t o p i c w e s ta r t n o w o n s li d e 2 7 C h a ir a n d w e t a k e y o u t o A p p e n d ix 4 0 a t 9 1 2 6 , C h a ir w e n o lo n g e r m e n ti o n th e c o v e r o f t h e A p p e n d i x . Page 107 of 116 30 MAY 2019 – DAY 102 CHAIRPERSON: Ye s . M R T H O B A N I T R E V O R M N YA N D U : t h e r e ’s an email sent by Mr At 9126 in volume 13 Chair Gary P i ta on 10 July 2015, it r e a d s …( i n t e r v e n ti o n ) . A D V M A H LA P E S E L L O : S o r r y, f o r r e f e r e n c e a t t h e b o t t o m o f 9 1 2 6 , r ig h t ? M R T H O B A N I T R E V O R M N YA N D U : C o r r e c t C h a ir, f o r y o u r r e a d i n g fr o m t h e b o t t o m o f t h e p a g e , “ H i L i n d i w e , fe e d b a c k fr o m t h e m e e ti n g t h i s m o r n i n g is th a t B T 10 w i ll b e s e n d i n g u s a n o t h e r l e t t e r p r o v i d i n g f u r th e r c l a r i ty o n t h e ir o ff e r. T h is i s e x p e c te d o n M o n d a y, c a n I a s k th a t y o u u p d a te a l l th e d o c u m e n t a ti o n i .e . m e m o f o r u s to s e n d t o th e a c ti n g G C E , w h i c h is f o r G r o u p C h i e f E x e c u tiv e f o r a p p r o v a l o f C N R a n d B T p r o p o s a l s a n d a l e tt e r fr o m G C E to C N R a n d B T a c c e p ti n g p r o p o s a ls . I n o r d e r to s a v e t i m e , s h o u l d t h e te a m c o p i e d b e h a p p y w i t h t h e p r o p o s a l s , w e c a n th e e ff e c t s ig n - o ff q u ic k ly. Pl e a s e a ls o e n s u r e t h a t t h e T I A , w h ic h is f o r Tr a n s n e t I n t e r n a l A u d i t C h a ir, s i g n - o ff f r o m ( in d i s ti n c t) is in c l u d e d i n t h e m e m o ” , t h e n i t s a y s G a r y P i ta , G r o u p C h i e f S u p p ly C h a in 20 O ff ic e r ” . A D V M A H LA P E S E L L O : B e f o r e y o u g o t o t h e r e s p o n s e t o t h a t e m a i l, t h e fir s t p a r a g r a p h o f t h a t e m a il r e a d s , “ f e e d b a c k fr o m th e m e e t in g th is m o r n in g i s t h a t B T w i ll b e s e n d i n g u s a n o t h e r l e t t e r ” . Page 108 of 116 30 MAY 2019 – DAY 102 M R T H O B A N I T R E V O R M N YA N D U : Ye s C h a ir. A D V M A H LA P E S E L L O : Th a t w o u l d s u g g e s t t h a t t h e r e w a s a m e e t in g h e l d t h a t m o r n in g , e i th e r M r G a r y P i t a w a s o r w a s n o t a p a r t o f t h a t m e e ti n g b u t M s L i n d i w e M d le t s h e m ig h t n o t h a v e b e e n a s h e is r e p o r t in g t o h e r. M R T H O B A N I T R E V O R M N YA N D U : ADV MAHLAPE SELLO: I n d e e d C h a ir. Th a t w o u ld b e a c o r r e c t i n t e r p r e ta t io n . N o w w e r e y o u a b l e t o e s ta b lis h w h a t t h i s m e e ti n g w a s a n d b e t w e e n w h o i t was? 10 M R T H O B A N I T R E V O R M N YA N D U : N o w e w e r e n o t a b l e t o C h a ir. A D V M A H L A P E S E L L O : O k a y, a n d I k n o w y o u s a i d y o u h a v e n ’ t h a d a n o p p o r t u n i ty to in t e r v ie w M r G a r y P it a . M R T H O B A N I T R E V O R M N YA N D U : M r G a r y P i t a . ADV MAHLAPE SELLO: H e w i ll s h e d l i g h t , I g u e s s , t h e d a y h e appears. C H A I R P E R S O N : B u t w h a t is c le a r fr o m t h a t e m a il is t h a t h e s a y s t h a t – is t h a t B T w a s g o in g t o b e s e n d i n g a l e t t e r p r o v id in g f u r t h e r c l a r i ty o n t h e ir o ff e r. S o – a n d w e k n o w th a t M r G a r y P i t a w a s o n e o f t h o s e w h o h a d s e n t e m a ils s e e k i n g – g iv in g c o m m e n t s , i s t h a t r i g h t ? 20 M R T H O B A N I T R E V O R M N YA N D U : I n d e e d C h a ir. CHAIRERSON: S o h e r e , a t l e a s t i n r e la ti o n t o B T h e t a lk s a b o u t a le t t e r th a t w o u l d b e s e n t , g iv i n g c l a r i t y a n d w e d o n ’ t k n o w w h e th e r i t w a s g o in g t o b e g iv i n g c l a r i ty o n s o m e o f t h e is s u e s h e h a d r a is e d o r w h e t h e r i t w a s c l a r i ty o n o t h e r a s p e c ts . M R T H O B A N I T R E V O R M N YA N D U : Ye s C h a ir Page 109 of 116 30 MAY 2019 – DAY 102 C H A I R P E R S O N : Ye s o k a y t h a n k y o u . M R T H O B A N I T R E V O R M N YA N D U : C h a ir m i g h t I a d d . C H A I R P E R S O N : Ye s . M R T H O B A N I T R E V O R M N YA N D U : B u t w h a t w e d o k n o w. C H A I R P E R S O N : Ye s . M R T H O B A N I T R E V O R M N YA N D U : I s t h a t t h e r e is s t il l t o b e a c la r i fi c a t io n r e c e iv e d f r o m B T, h o w e v e r M s M d l e t s h e is n o w b e i n g r e q u e s t e d t o p r e p a r e t h e n e c e s s a r y m e m o r a n d u m fo r t h e a p p r o v a l o f b o t h th e c o s t i n r e s p e c t o f B T a s w e l l a s C N R . 10 C H A I R P E R S O N : Ye s w h ic h m a y m e a n th a t t h e y – w h ic h m a y m e a n th a t t h e y k n o w – t h e y ’ v e b e e n g iv e n c l a r it y v e r b a l ly a n d w h a t’s l e ft is j u s t t h a t c la r i ty b e i n g i n w r i ti n g , t h a t ’s o n e w a y o f l o o k i n g a t i t . Another w a y o f l o o k i n g a t i t , i s p r o b a b ly w h a t y o u h a v e i n m in d th a t t h e y ’r e g o i n g a h e a d b e fo r e g e t t in g c la r i ty. M R T H O B A N I TR E V O R M N YA N D U : N o C h a ir, i t ’s n o t w h a t I h a d i n m i n d , I a g r e e t h a t, t h a t ’s o n e w a y o f lo o k i n g a t i t . C H A I R P E R S O N : Is t h e r e a n o th e r w a y, y o u th i n k ? M R T H O B A N I T R E V O R M N YA N D U : C h a ir I th i n k y o u a n d I a r e a d id e m , w e a r e i n a g r e e m e n t t h a t t h e r e w o u l d b e a n o th e r w a y. 20 C H A I R P E R S O N : Ye s . A D V M A H LA P E S E L L O : B u t e v e n th e n w e a t le a s t a c c e p t t h a t i t is c la r i ty t h a t M s M d l e ts h e d id n o t h a v e a s s h e p r e p a r e d th e m e m o . M R T H O B A N I T R E V O R M N YA N D U : I n d e e d C h a ir. A D V M A H L A P E S E L L O : O k a y. C H A I R P E R S O N : Ye s . Page 110 of 116 30 MAY 2019 – DAY 102 A D V M A H L A P E S E L L O : Ye s y o u m a y c o n t in u e , t h a n k y o u . M R T H O B A N I T R E V O R M N YA N D U : C h a ir s t ic k i n g t o o r s t a y in g o n p a g e 9 1 2 6 , g o in g f u r th e r u p th e p a g e t h e r e ’s a n e m a il fr o m M s L i n d iw e M d le t s h e o n 1 0 J u ly a t 4 h 1 4 , s h e w r i te s , “ H i G a r y, I w ill p r e p a r e a s r e q u e s t e d a n d c ir c u l a t e fo r c o m m e n t s b y M o n d a y, Ki d R e g a r d s , L i n d iw e M d l e ts h e ” . A D V M A H L A P E S E L L O : Ye s . M R T H O B A N I T R E V O R M N YA N D U : C h a ir w h a t w e w o u ld li k e y o u t o n o t e i n r e s p e c t o f th e e m a i l c o r r e s p o n d e n c e s e n t b y M r G a r y Pi t a o n 10 t h a t d a y b e i n g 1 0 J u l y 2 0 1 5 is th a t Mr Yu s u f L a h e r n o t a b ly is n o lo n g e r c o p i e d i n t h e e m a il e x c h a n g e s . C H A I R P E R S O N : Ye s . ADV MAHLAPE SELLO: A n d i t w a s M r G a r y P i t a w h o d ir e c t e d s p e c i f ic a l ly t o Mr Yu s u f L a h e r c e r ta i n t a s k s a n d a s k e d h i m to d o c e r ta i n things. M R T H O B A N I T R E V O R M N YA N D U : I n d e e d C h a ir. C H A I R P E R S O N : J u s t r e m in d m e a g a i n , w h a t w a s Mr L e h a r ’s p o s i ti o n ? M R T H O B A N I TR E V O R M N YA N D U : the 20 finance department of the H e w a s a n E x e c u tiv e M a n a g e r i n o p e r a t in g d i v is i o n a c q u ir i n g the lo c o m o t iv e s , Tr a n s n e t F r e i g h t R a il . C H A I R P E R S O N : Ye s . M R T H O B A N I T R E V O R M N YA N D U : Ye s . C H A I R P E R S O N : Th a t w o u l d s e e m t o s u g g e s t i t w a s s o m e b o d y w h o s e c o n c e r n s s h o u ld b e g iv e n s o m e a t te n ti o n . M R T H O B A N I T R E V O R M N YA N D U : Ye s C h a ir. Page 111 of 116 30 MAY 2019 – DAY 102 CHAIRPERSON: Ja okay yes. A D V M A H L A P E S E L L O : Ye s M r M n y a n d u . M R T H O B A N I TR E V O R M N YA N D U : C h a i r tu r n in g o v e r t o s l id e 2 8 o f t h e p r e s e n t a ti o n , w e n o w t a k e y o u t h r o u g h th e a p p r o v a l p r o c e s s a r is i n g fr o m t h e e m a i l s e n t b y M r G a r y P i t a , fir s tl y i n r e la t io n t o C N R o n 2 2 J u l y 2 0 1 5 , M s L in d i w e M d le ts h e c o m p il e d a s e p a r a t e m e m o r a n d u m f o r t h e a p p r o v a l o f t h e c o s t s o f C N R a t a n a m o u n t o f R 6 4 7 1 8 1 4 9 4 .0 0 . C h a ir t h is m e m o r a n d u m i s to b e f o u n d a t v o l u m e 1 3 a t p a g e 9 1 3 5 … ( i n te r v e n ti o n ) . 10 A D V M A H L A P E S E L L O : I’ m s o r r y M r M n y a n d u , b e f o r e t h e C h a ir d o e s t h a t I ’d li k e u s t o g o b a c k to 9 1 2 6 i n th a t e m a i l c h a i n a t t h e to p is a f u r th e r e m a i l f r o m M r G a r y P i t a b u t th is ti m e a d d r e s s e d t o Mr S e li n g a . M R T H O B A N I T R E V O R M N YA N D U : Ye s C h a ir. A D V M A H L A P E S E L L O : A n d i t s e e m s to s u g g e s t t h a t th e d o c u m e n t i s r e a d y a n d is r e q u e s t in g M r S e li n g a t o r e v i e w t h e l e g a l c la u s e s a n d c a v e a ts o n ly. M R T H O B A N I T R E V O R M N YA N D U : Ye s C h a ir. ADV MAHLAPE SELLO: S o b y th e 1 4 t h o f J u l y th e d o c u m e n t w a s , f o r a l l i n t e n ts a n d p u r p o s e s r e a d y. 20 M R T H O B A N I T R E V O R M N YA N D U : Ye s C h a ir. C H A I R P E R S O N : C a n I ta k e y o u b a c k , t h e M o n d a y o n w h ic h i t w a s s a id t h e le t t e r o f c la r i ty fr o m BT would be received, what – do you know w h a t d a t e t h a t M o n d a y w o u ld h a v e b e e n ? M R T H O B A N I T R E V O R M N YA N D U : I t w o u ld h a v e b e e n M o n d a y 1 3 J u l y C h a ir. Page 112 of 116 30 MAY 2019 – DAY 102 CHAIRPERSON: O k a y a n d t h e m e m o r a n d u m t h a t M s M d l e ts h e w a s p r e p a r in g s e e ms t o h a v e g o t – t o h a v e b e e n r e a d y b y w h e n ? M R T H O B A N I T R E V O R M N YA N D U : T h e 2 2 n d o f J u ly. CHAIRPERSON: Okay thank you. M R T H O B A N I T R E V O R M N YA N D U : T h a n k s C h a ir. A D V M A H L A P E S E L L O : O k a y s o th e n I s e e t h a t M r G a r y P i t a r e q u e s ts M r S e l i n g a t o h a v e r e g a r d t o t h e d o c u m e n t a n d r e v i e w t h e l e g a l c la u s e s a n d c a v e a ts r a is e d i n b o t h p r o p o s a ls e s p e c ia ll y i n t h e B T o ff e r. M R T H O B A N I T R E V O R M N YA N D U : Ye s C h a ir. 10 A D V M A H L A P E S E L L O : F i r s tl y w e r e y o u a b l e t o c o n s id e r a d o c u m e n t t h a t r e fl e c ts t h e c a v e a ts , p a r t ic u l a r l y r a is e d i n t h e B T p r o p o s a l? M R T H O B A N I T R E V O R M N YA N D U : Ye s w e w e r e C h a ir. ADV MAHLAPE SELLO: And what were those in brief? M R T H O B A N I T R E V O R M N YA N D U : I n s u m m a r y t h o s e s p o k e to t h e a m o u n t fir s t o f a l l b e i n g o ff e r e d b y B T f o r r e l o c a t i o n c o s ts , i t s p o k e t o t h e p a y m e n t t e r m s i n r e la t io n to t h e o ffe r a s w e l l a s a c h a n g e in t h e f a c i li ty t o b e r e c o r d e d a s D u r b a n B a y H e a d . A D V M A H LA P E S E L L O : O k a y, s o – a n d t h e y w a n t e d t h o s e i s s u e s a d d r e s s e d b e f o r e t h e y c o u l d f i n a ll y d e c id e , i s t h a t t h e u n d e r s ta n d i n g ? 20 M R T H O B A N I T R E V O R M N YA N D U : Ye s . A D V M A H LA P E S E L L O : O k a y t h e e m a il t h e n g o e s fu r t h e r t o s a y, t h e y r a i s e s o m e c l a u s e s w h ic h mi g h t h a v e a s ig n i fi c a n t i m p a c t p l e a s e a d v i s e s o w e c a n s i g n th is o ff A S A P, t h a t is Mr G a r y P i t a o n th e 1 4 t h o f J u ly. M R T H O B A N I T R E V O R M N YA N D U : I n d e e d C h a ir. ADV MAHLAPE SELLO: Okay now do you have a record of how Mr Page 113 of 116 30 MAY 2019 – DAY 102 S e li n g a d e a lt w i t h th a t r e q u e s t ? M R T H O B A N I TR E V O R M N YA N D U : In d e e d C h a ir i t is d e a l t w i t h in o u r r e p o r t , t h e r e s p o n s e is a n A p p e n d i x , i t ’s j u s t t h a t w e h a v e n o t c o v e r e d it i n th e p r e s e n ta t io n b u t w e c a n ta k e t h e C h a ir t h r o u g h if w e fi n d t h e A p p e n d i x o n th e r e p o r t . ADV MAHLAPE SELLO: If you recall, perhaps the essence of that A p p e n d i x , y o u m a y t e l l t h e C h a ir. MR THOBANI TR E V O R M N YA N D U : T h e A p p e n d ix – sorry the c o n c e r n e d w a s a r e s p o n s e fr o m M r S e li n g a i n w h ic h h e n o t e d 1 ) 10 6 1 7 m i lli o n r a n d a s a n o ff e r fr o m B T i s o k a y i f t h a t’s w h a t y o u h a v e a g r e e d . 2 ) T h e o t h e r c la u s e s w e r e fi n e , h o w e v e r, h e r a is e d a p a r ti c u l a r c o n c e r n o r a c o m m e n t i n r e l a t i o n to , I b e l ie v e , t h e d e l a y s , b u t I s ta n d t o b e c o r r e c t e d C h a ir, i t w o u l d b e a d o c u m e n t t h a t w e s h o u l d l o o k a t a s t h e A p p e n d i x b u t i n d e e d t h e r e w a s a r e s p o n s e t h a t d e a lt w it h t h e B T is s u e s i n t h a t f o r m . ADV MAHLAPE SELLO: Okay thank you. Chair we we hoped are m i n d f u l … ( in t e r v e n ti o n ) . CHAIRPERSON: We ( i n d i s t i n c t) achieved what to a c h i e v e … ( i n te r v e n t io n ) . 20 A D V M A H L A P E S E L L O : W h a t w e s e t o u t t o a c h ie v e t i m e w is e . CHAIRPERSON: Ye s b u t t h e r e h a s n ’ t b e e n a n y d e l a y w e h a v e b e e n e n g a g i n g M r M n y a n d u w i t h h is i m p o r t a n t is s u e s , h o w m u c h m o r e ti m e d o y o u n e e d …( i n t e r v e n ti o n ) . ADV MAHLAPE SELLO: H e ’s g o t s e v e n s li d e s to g o C h a ir, I g u e s s i f h e c o u ld i n d ic a t e to u s , i f w e d o n ’ t e n g a g e h i m a n y f u r t h e r h o w lo n g Page 114 of 116 30 MAY 2019 – DAY 102 t h a t m i g h t t a k e h i m b u t if t h e C h a ir e n g a g e s h i m a n d m y s e l f p e r h a p s t h a t m i g h t d o u b l e o r t r i p l e th e ti m e r e q u ir e d . C H A I R P E R S O N : W e l l I n e e d to b e o u t o f h e r e n o w. A D V M A H L A P E S E L L O : Ye s C h a ir. C H A I R P E R S O N : I w a s h o p in g th a t – I w a s h o p in g t o b e o u t o f h e r e a t h a l f p a s t t w e lv e a n d I w a s h o p in g th a t 1 o ’c l o c k w o u ld b e f i n e s o i t hasn’t happened. I ’ m w o n d e r in g w h e t h e r w e s h o u l d n ’ t m a k e s p a c e i f M r M n y a n d u is a v a i la b l e f o r to m o r r o w t o fi n is h p r o p e r ly b e f o r e w e s ta r t with the next witness. 10 ADV M A H LA P E SELLO: We could C h a ir, if Mr Mnyandu is a v a i la b le . . .( i n t e r v e n t i o n ) . M R T H O B A N I T R E V O R M N YA N D U : C h a ir I c o n f ir m I a m a v a i la b l e . C H A I R P E R S O N : Yo u a r e a v a i l a b l e ? M R T H O B A N I T R E V O R M N YA N D U : Ye s in d e e d . ADV MAHLAPE SELLO: A n d f o r t h a t p u r p o s e w e c o u ld s t a r t a t 9 o ’c l o c k c o n s id e r in g th e r e a r e s e v e n s l i d e s le f t th a t s h o u ld n o t t a k e u s m o r e t h a n a n h o u r, I’ m q u i t e m i n d f u l t h a t w e d o n ’ t i m p a c t th e ti m e o f t h e n e x t w i tn e s s . CHAIRPERSON: 20 Ye s w h a t ’s y o u r o w n e s ti m a t e o f h o w m u c h t i m e w e n e e d , I’ m tr y i n g to t h in k w h e t h e r w e s h o u ld s a y 9 o ’ c l o c k o r h a l f p a s t nine. A D V M A H LA P E S E L L O : I w o u l d – i t ’s g o t r e f e r e n c e s – th e 7 s li d e s h a v e r e f e r e n c e s t o c e r t a i n d o c u m e n ta t i o n a n d a s I h a v e s e e n it is w h e n w e c o n s i d e r t h e d o c u m e n ts t h a t p e r h a p s w e t a k e s li g h tly m o r e t i m e , I s e e a b o u t f o u r o r fiv e d o c u m e n t s t h a t h e c r o s s - r e fe r s , I t h in k I w o u l d Page 115 of 116 30 MAY 2019 – DAY 102 b e m o r e c o m f o r ta b l e w i t h o n e - h o u r C h a ir o th e r w i s e i f w e d o h a l f p a s t n i n e t h e n w e m a y f o r c e a d v o c a te P r e t o r iu s t o r u n ti ll 5 a n d h e m ig h t n o t b e q u i t e h a p p y w i th t h a t , s o . C H A I R P E R S O N : Ye s n o I t h i n k w e – I th in k le t ’s s t a r t a t h a l f p a s t n i n e . ADV MAHLAPE SELLO: Half past nine? C H A I R P E R S O N : J a l e t ’s s t a r t a t h a l f p a s t n in e b e c a u s e th e r e m a y b e s o m e t h i n g e l s e th a t I n e e d t o a t t e n d t o i f w e s t a r t a t n in e , t h e r e m i g h t b e s o m e d i ff ic u l t y, le t ’s s t a r t a t h a l f p a s t n i n e . A D V M A H L A P E S E L L O : C a te r i n g f o r o n e h o u r. 10 C H A I R P E R S O N : A n d h o p e – tr y a n d f in is h a t l e a s t w it h in a n h o u r o r 4 5 m i n u t e s d e p e n d in g . O k a y, a lr i g h t w e ’l l a d j o u r n t h e n fo r n o w. So Mr M n y a n d o w e w il l s t a r t a t h a l f p a s t n i n e t o m o r r o w, s o i f y o u c o u l d b e b a c k to m o r r o w. M R T H O B A N I T R E V O R M N YA N D O : Th a n k y o u C h a ir. C H A I R P E R S O N : Ye s , w e w i ll a d j o u r n u n t il to m o r r o w a t h a l f p a s t n i n e in t h e m o r n in g , w e a d j o u r n . A D V M A H L A P E S E L L O : T h a n k y o u C h a ir. I N Q U I R Y A D J O U R N S TO 3 1 M AY 2 0 1 9 Page 116 of 116