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Executive Remuneration and Performance Management

Mercy Ranko

General Manager: Human Resources

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SUMMARY OF PERFORMANCE MANAGEMENT PROCEDURE

Procedure

1. Plan Performance Management- Define strategic objectives- Compile Executive Balanced Scorecards- Compile Divisional/ Departmental Balanced Scorecards- Formulate group objectives and performance standards

2. Implement Performance Management- Conclude Individual Performance Compact- Monitor employee performance- Conduct Interim Performance Review

Level 5: Outstanding: Work performance is exceptional and far exceeds the performance standard/ target required Level 4: Above standard: Work performance is superiorLevel 3: Successful: Work performance is goodLevel 2: Improvement neededLevel 1: Unsatisfactory

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3. Review Performance Management- Collate and analyse annual Employee Performance Review results- Monitor performance management

4. Manage Unsatisfactory Performance- Identify unsatisfactory performance- Respond to unsatisfactory performance- Initiate the performance improvement process- Conduct the performance improvement process- No improvement - disciplinary process which may lead to dismissal- Appeals

SUMMARY OF PERFORMANCE MANAGEMENT PROCEDURE (cont.)

Executive performance results are determined as follows:1. 70% Individual 2. 30% Overall company performance

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ILLUSTRATIVE MEASURES & EVALUATION OF OBJECTIVES

Objectives Key Performance Indicators (KPIs) %Weighting

1. Financial Perspective (25%)

Funding 1. Timeous, accurate and relevant submission of reports (listed below) to Board, Investors and Stakeholders to facilitate sufficient funding throughout the year to fund operations in line with the Board approved budget at the beginning of the year:

i. Corporate Plan (28 February)

ii. Quarterly Reports (1.5 months after each quarter)

iii. MTEF (30 August 2008)

iv. Annual Report (30 August 2008)

a. Score 5: All reports are of excellent quality, accurate, submitted timeously, within

agreed timelines and changes in the environment as well as in shareholder

perspectives are proactively reflected

b. Score 4: All reports are of excellent quality, accurate, submitted timeously and

within agreed timelines

c. Score 3: All reports are relevant, accurate and submitted timeously

d. Score 2: One or two reports are submitted more than a month late or contain

significant inaccuracies

e. Score 1: Two or more reports are submitted more than a month late and contain

serious inaccuracies

5%

Note:Weightingdeterminedon keyfocus areasfor business

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ILLUSTRATIVE MEASURES & EVALUATION OF OBJECTIVES (CONT.)

Objectives Key Performance Indicators (KPIs) %Weighting

1. Financial Perspective (25%)

Funding 2. Commitment by Shareholders / Investors to fund the three year

corporate plan.

a. Score 5: Commitment by February 2009 to fund 3 year Plan

b. Score 4: Commitment by February 2009 to fund the 2009/10 and 2010/11 budget

c. Score 3: Commitment by February 2009 to fund the 2009/10 budget

d. score 2: Commitment by February 2009 to fund only part of the 2009/10 budget

e. Score 1: No commitment by February 2009 to fund any part of the 3 year plan. The extent and nature of the involvement of all shareholders in the funding of the 3 year corporate plan will be taken into account

3. 95% of audit findings to be closed out within agreed timeframe as from July 2008.

a. Score 5: 100% of audit findings are closed out within agreed timeframes

b. Score 4: 95% of audit findings are closed out within agreed timeframes and no significant findings are closed out late

c. Score 3: 90% of audit findings and 95% of significant audit findings are closed out within an average of 1 month after agreed upon time frame

d. Score 2: 90% of audit findings and 90% of significant audit findings are closed out within an average of 1 month after the agreed time frame

e. Score 1: Less than 90% of all audit findings are closed out within an average of 1 month after the agreed time frame

5%

5%

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ILLUSTRATIVE MEASURES & EVALUATION OF OBJECTIVES (CONT.)

Objectives Key Performance Indicators (KPIs) %Weightin

g

Internal Processes(12)

Licensing The North American NGNP JV between PBMR and Westinghouse and the SASOL

programme (in South Africa) are the focus of these activities

a. Score 5: SASOL Technical Assessment and Business Development process both support pre-feasibility phase and pre-feasibility is completed in the reporting period. PBMR Westinghouse JV submits a bid against the RFP to DoE

b. Score 4: SASOL Technical Assessment and Business Development process both support pre-feasibility phase and pre-feasibility progressed 50% in the reporting period. PBMR Westinghouse JV timeously prepares a bid against the RFP to DoE within the required RFP timelines

c. Score 3: SASOL Technical Assessment and Business Development process both support pre-feasibility phase and pre-feasibility is initiated and progressed in the reporting period. PBMR Westinghouse JV timeously prepares a bid against the RFP to DoE within the required RFP timelines

d. Score 2: SASOL exits or PBMR Westinghouse does not participate in DoE NGNP process and RFP

e. Score 1: SASOL exits or PBMR Westinghouse does not participate in DoE NGNP process and RFP as a result of PBMR not seen as a viable partner or not effectively managing the process

5%

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Objectives Key Performance Indicators (KPIs) %Weighting

Internal Processes(12)

OrganisationCulture

1. EE equity targets

a. Score 5: 60% or more of all new appointments are black and 30% or more of all new appointments are female

b. Score 4: 50-59% of all new appointments are black and 25-29% of all new

appointments are female

c. Score 3: 40-49% of all new appointments are black and 20-24% of all new

appointments are female

d. Score 2: 30-39% of all new appointments are black and 15-19% of all new

appointments are female

e. Score 1: Less than 30% of all new appointments are black or less than 15% of all new appointments are female

2. BBBEE: PBMR Independently reviewed rating in March 2009

a. Score 5: BBBEE rating 3

b. Score 4: BBBEE rating 4

c. Score 3: BBBEE rating 5

d. Score 2: BBBEE rating 6

e. Score 1: BBBEEE rating of lower than 6

5%

5%

ILLUSTRATIVE MEASURES & EVALUATION OF OBJECTIVES (CONT.)

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Status and filling of vacancies

Position Title

Pre-restruc-turing

Post restruc-turing

Chief Executive Officer Vacant

Chief Financial Officer Filled √

General Manager: Human Resources Filled

General Manager: Engineering Filled √

General Manager: Corporate Legal Counsel Filled

General Manager: Corporate Services Filled

General Manager: PBMR Way Filled

General Manager: Projects Filled

General Manager: Nuclear Safety, Licensing and SHEQ (acting CEO) Filled √

General Manager: Business Development Vacant

Chief Technology Officer Filled

Note: PBMR is currently undergoing restructuring

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Thank You