notice of annual general meeting

Notice is hereby given that the first annual general meeting of the shareholders of Blue Label Telecoms will be held in the boardroom, Blue Label Telecoms Corporate Offices, 75 Grayston Drive, Sandton, on Wednesday, 12 November 2008 at 10:00 to conduct the following business

4. To approve the non-executive directors’ remuneration for the year ending 31 May 2009.

Proposed remuneration for non-executive directors:

5. To re-appoint PricewaterhouseCoopers Inc. as independent registered auditors of the company, to authorise the directors to fix the remuneration of the auditors for the past year’s audit as reflected in note 18 of the annual financial statements and to note that the individual registered auditor who will undertake the audit during the financial year ending 31 May 2009 is Mr EJ Gerryts.

To consider and, if deemed fit, pass with or without modification the following special resolution and ordinary resolutions.

6. Special resolution number 1 – General authority to repurchase shares

Resolved that the company or any of its subsidiaries be and they are hereby authorised, by way of a general approval, to acquire ordinary shares issued by the company, in terms of section 85 and 89 of the Companies Act, No 61 of 1973, as amended (the Companies Act), and in terms of the JSE Limited (the JSE) Listings Requirements, being that:

• any such acquisition of ordinary shares shall be effected through the order book operated by the JSE trading system and done without any prior understanding or arrangement with the counterparty;
• this general authority shall be valid until the company’s next annual general meeting, provided that it shall not extend beyond 15 (fifteen) months from the date of passing of this special resolution number 1;
• an announcement will be published as soon as the company or any of its subsidiaries have acquired ordinary shares constituting, on a cumulative basis, 3% of the number of ordinary shares in issue and for each 3% in aggregate of the initial number acquired thereafter, in compliance with paragraph 11.27 of the JSE Listings Requirements;
• acquisition of shares in aggregate in any one financial year may not exceed 20% of the company’s ordinary issued share capital as at the date of passing of this special resolution number 1;
• ordinary shares may not be acquired at a price greater than 10% above the weighted average of the market value at which such ordinary shares are traded on the JSE as determined over the five business days immediately preceding the date of repurchase of such ordinary shares;
• the company has been given authority by its articles of association;
• at any point in time, the company and/or its subsidiaries may only appoint one agent to effect any repurchase;
• the company and/or its subsidiaries undertaking that they will not enter the market to repurchase the company’s shares until the company’s sponsor has provided written confirmation to the JSE regarding the adequacy of the company’s working capital in accordance with Schedule 25 of the JSE Listings Requirements;
• the company remaining in compliance with the shareholder spread requirements of the JSE Listings Requirements; andthe company and/or its subsidiaries not repurchasing any shares during a prohibited period, as defined in the JSE Listings Requirements unless a repurchase programme is in place, where dates and quantities of shares to be traded during the prohibited period are fixed and full details of the programme have been disclosed in an announcement over the Securities Exchange News Service (SENS) prior to the commencement of the prohibited period.

Before entering the market to effect the general repurchase, the directors, having considered the effects of the repurchase of the maximum number of ordinary shares in terms of the aforegoing general authority, will ensure that for a period of 12 (twelve) months after the date of the notice of annual general meeting:

• the company and the Blue Label Telecoms group will be able, in the ordinary course of business, to pay its debts;
• the consolidated assets of the company and the Blue Label Telecoms group, fairly valued in accordance with International Financial Reporting Standards, will exceed the liabilities of the company and the Blue Label Telecoms group;
• the company and the Blue Label Telecoms group’s ordinary share capital, reserves and working capital will be adequate for ordinary business purposes; and
• the working capital of the company and the Blue Label Telecoms group will be adequate for the purposes of the business of the company and the Blue Label Telecoms group.

The following additional information, some of which may appear elsewhere in the annual report of which this notice forms part, is provided in terms of the JSE Listings Requirements for purposes of the general authority:

• directors – Board of directors'
• major beneficial shareholders – Shareholder analysis
• directors’ interests in shares – Directors' report
• share capital of the company

Litigation statement

In terms of paragraph 11.26 of the JSE Listings Requirements, the directors, whose names appear on pages the Board of directors' of this annualreport of which this notice forms part, are not aware of any legal or arbitration proceedings that are pending or threatened, that may have or had in the recent past, being at least the previous 12 (twelve) months, a material effect on the Blue Label Telecoms group’s financial position.

Directors’ responsibility statement

The directors whose names appear on the Board of directors' of this annual report confirm that to the best of their knowledge and belief:

• the statements made in the annual report are true and correct;
• there are no facts which have been omitted which would make any statement false or misleading and that all reasonable inquiries to ascertain such facts have been made;
• the annual report contains all information required by law and in the JSE Listings Requirements; and in these circumstances the directors accept responsibility for the information contained in this annual report.

Material change

Other than the facts and developments reported on in this annual report, there have been no material changes in the affairs or financial position of the company and its subsidiaries since the date of signature of the audit report and up to the date of this notice.

The reason for and effect of this special resolution is to grant the directors of the company or its subsidiaries a general authority in terms of the Companies Act and the JSE Listings Requirements for the repurchase by the company or a subsidiary company of the company, of the company’s shares.

The repurchase of the company’s shares may be advisable having regard to a number of factors, including share price, surplus cash and the opportunity to enhance earnings per share. The company requests shareholders to give the directors a general authority for the company to purchase its shares should it be opportune to do so.

7. Ordinary resolution number 1 – Control of authorised but unissued shares

Resolved that a general authority be granted to the directors to allot and issue the unissued ordinary shares of the company subject to the following limitations:

• the authority shall be valid until the date of the next annual general meeting of the company, provided it shall not extend beyond 15 (fifteen) months from the date of this annual general meeting.
• issues in terms of this authority will not, in any financial year, in aggregate exceed 3% of the number of ordinary shares in the company’s issued share capital as at 31 May 2008.
• issues in terms of this authority shall be subject to the provisions of section 221 of the Companies Act and the JSE Listings Requirements.

8. Ordinary resolution number 2 – General authority to issue shares for cash

Resolved that subject to the general authority proposed in terms of ordinary resolution number 1 above and in terms of the JSE Listings Requirements, shareholders grant the directors a general authority for the allotment and issue of ordinary shares in the capital of the company for cash as and when suitable situations arise, subject to the following limitations:

• any issue of shares shall be to public shareholders as defined by the JSE Listings Requirements;
• this authority shall be valid until the date of the next annual general meeting of the company, provided it shall not extend beyond 15 (fifteen) months from the date of this annual general meeting;
• a paid press announcement giving details, including the impact on net asset value and earnings per share, will be published at the time of any such allotment and issue of shares representing, on a cumulative basis within one year, 3% or more of the ordinary number of issued shares prior to any such issues;
• that issues in the aggregate in any one financial year shall not exceed 3% of the ordinary shares in the issued share capital of the company from time to time; and
• in determining the price at which an allotment and issue of shares will be made in terms of this authority, the maximum discount permitted will be 10% of the weighted average traded price of the ordinary shares over the 30 days prior to the date that the price of issue is determined or agreed by the directors of the company.

In terms of the JSE Listings Requirements, the approval of 75% majority of the votes cast by shareholders present or represented by proxy at this annual general meeting will be required for this authority to become effective.

9. Ordinary resolution number 3 – Approval of the Blue Label Telecoms Forfeitable Share Plan (the share plan)

Resolved that the Blue Label Telecoms Forfeitable Share Plan, the rules of which was tabled at the meeting and initialled by the chairman of the meeting for the purposes of identification, be and is hereby adopted.

10. Ordinary resolution number 4 – Authorisation to implement the share plan

Resolved that, subject to ordinary resolution number 3 being passed at the meeting at which this ordinary resolution number 4 will be proposed and considered, the directors of Blue Label Telecoms be and are hereby authorised to do all such things and sign all documents, including company forms, and take all such action as they consider necessary to give effect to and implement the Forfeitable Share Plan.

11. Ordinary resolution number 5 – Signature of documents

Resolved that any one director or the secretary of the company be and is hereby authorised to do all such things and sign alldocuments and take all such action as they consider necessary to implement the resolutions set out in the notice convening this annual general meeting at which this ordinary resolution will be considered.

VOTING AND PROXIES

Shareholders may appoint a proxy to attend, speak and, in respect of the applicable resolution(s), vote in their stead. Shareholders holding dematerialised shares but not in their own name must furnish their Central Securities Depository Participant (CSDP) or broker with their instructions for voting at the annual general meeting should they wish to vote. If your CSDP or broker, as the case may be, does not obtain instructions from you, it will be obliged to act in terms of your mandate furnished to it, or if the mandate is silent in this regard, to complete the relevant from of proxy attached. Unless you advise your CSDP or broker, in terms of the agreement between you and your CSDP or broker by the cut-off time stipulated therein, that you wish to attend the annual general meeting or send a proxy to represent you at the annual general meeting, your CSDP or broker will assume you do not wish to attend the annual general meeting or send a proxy. If you wish to attend the annual general meeting or send a proxy, you must request your CSDP or broker to issue the necessary letter of representation to you.

Shareholders holding dematerialised shares in their own name, or who hold shares that are not dematerialised, and who are unable to attend the annual general meeting and wish to be represented thereat, must complete the relevant form of proxy attached in accordance with the instructions therein and lodge it with, or mail it to, the transfer secretaries.

Forms of proxy should be forwarded to reach the company’s transfer secretaries at the address given below by not later than 10:00 on Tuesday 11 November 2008. The completion of a form of proxy will not preclude a shareholder from attending the annual general meeting.

By order of the board

E Viljoen
Group Company Secretary

13 October 2008