Document:

<PAGE>
                               HARMONY UNDERTAKING

                                     Amongst

                       HARMONY GOLD MINING COMPANY LIMITED

                                       and

                    ARMGOLD HARMONY JOINT INVESTMENT COMPANY
                              (PROPRIETARY) LIMITED

                                       and

                                 NEDBANK LIMITED
                  (ACTING THROUGH ITS NEDBANK CAPITAL DIVISION)

                                                                  DENEYS | REITZ
                                                                       ATTORNEYS
<PAGE>
                              NOTARIAL CERTIFICATE

I, THE UNDERSIGNED,

                                MARK ROBERT KYLE

OF SANDTON IN THE GAUTENG PROVINCE OF THE REPUBLIC OF SOUTH AFRICA, NOTARY
PUBLIC BY LAWFUL AUTHORITY DULY ADMITTED AND SWORN, DO HEREBY CERTIFY AND ATTEST
UNTO ALL WHOM IT MAY CONCERN THAT I HAVE THIS DAY COLLATED AND COMPARED WITH THE
ORIGINAL THEREOF, THE COPY HERETO ANNEXED MARKED "A", BEING:

"A"  HARMONY UNDERTAKING AMONGST HARMONY GOLD MINING COMPANY LIMITED AND ARMGOLD
     HARMONY JOINT INVESTMENT COMPANY (PROPRIETARY) LIMITED AND NEDBANK LIMITED
     (ACTING THROUGH ITS NEDBANK CAPITAL DIVISION), DATED 15 APRIL 2005

AND I, THE SAID NOTARY, DO FURTHER CERTIFY AND ATTEST THAT THE SAME IS A TRUE
AND FAITHFUL COPY OF THE SAID ORIGINAL AND AGREES THEREWITH IN EVERY RESPECT. AN
ACT WHEREOF BEING REQUIRED, I HAVE GRANTED THESE PRESENTS UNDER MY NOTARIAL FORM
AND SEAL, TO SERVE AND AVAIL AS OCCASION SHALL OR MAY REQUIRE.

THUS DONE AND SIGNED AT SANDTON AFORESAID ON THIS THE 26TH DAY OF APRIL IN THE
YEAR TWO THOUSAND AND FOUR.

                                                                   NOTARY PUBLIC

DENEYS REITZ ATTORNEYS
SANDTON
<PAGE>
                               HARMONY UNDERTAKING

                                     Amongst

                       HARMONY GOLD MINING COMPANY LIMITED

                                       and

                    ARMGOLD HARMONY JOINT INVESTMENT COMPANY
                              (PROPRIETARY) LIMITED

                                       and

                                 NEDBANK LIMITED
                  (ACTING THROUGH ITS NEDBANK CAPITAL DIVISION)

                                                                  DENEYS | REITZ
                                                                       ATTORNEYS
<PAGE>
                                TABLE OF CONTENTS

<TABLE>
<S>                                                                           <C>
1. PARTIES ................................................................    1
2. DEFINITIONS AND INTERPRETATION .........................................    1
3. INTRODUCTION ...........................................................    7
4. REPAYMENT OF THE HARMONY LOAN OUTSTANDINGS .............................    8
5. AHJIC UNDERTAKING ......................................................    9
6. REPRESENTATIONS AND WARRANTIES .........................................    9
7. BREACH .................................................................   11
8. CONFIDENTIALITY ........................................................   12
9. NOTICES AND DOMICILIA ..................................................   13
10. GOVERNING LAW .........................................................   15
11. JURISDICTION ..........................................................   16
12. SEVERABILITY ..........................................................   16
13. GENERAL ...............................................................   16
14. COSTS .................................................................   17
15. COUNTERPARTS ..........................................................   18
</TABLE>
<PAGE>
                               HARMONY UNDERTAKING

1.   PARTIES

1.1  The Parties to this Agreement are:

1.1.1 HARMONY GOLD MINING COMPANY LIMITED;

1.1.2 ARMGOLD HARMONY JOINT INVESTMENT COMPANY (PROPRIETARY) LIMITED; and

1.1.3 NEDBANK LIMITED (ACTING THROUGH ITS NEDBANK CAPITAL DIVISION).

1.2  The Parties agree as set out below.

2.   DEFINITIONS AND INTERPRETATION

2.1  The headings to the clauses of this Agreement are for reference purposes
     only and shall in no way govern or affect the interpretation of nor modify
     nor amplify the terms of this Agreement nor any clause hereof.

2.2  Unless the context dictates otherwise, the words and expressions set forth
     below shall bear the following meanings and cognate expressions shall bear
     corresponding meanings:

2.2.1 "AGREEMENT" means this Harmony Undertaking;

2.2.2 "AHJIC" means ARMGold Harmony Joint Investment Company (Proprietary)
     Limited (Registration No. 2002/032163/07), a private company duly
     incorporated according to the company laws of South Africa;
<PAGE>
                                                                         Page 2.

2.2.3 "ARM" means African Rainbow Minerals Limited (Registration No.
     1933/004580/06), a public company duly incorporated according to the
     company laws of South Africa;

2.2.4 "ARM SHARES" means 28 614 740 (twenty-eight million six hundred and
     fourteen thousand seven hundred and forty) ordinary par value shares of
     R0,05 (five cents) each in the issued share capital of ARM listed on the
     JSE Securities Exchange, South Africa and constituting 14% (fourteen
     percent) of the issued share capital of ARM as at the Signature Date to be
     purchased by the Trust from AHJIC pursuant to the Sale of Shares Agreement;

2.2.5 "BUSINESS DAY" means any day other than a Saturday, Sunday or an official
     public holiday in South Africa in accordance with the Public Holidays Act,
     1994;

2.2.6 "DISTRIBUTION" means any payment in respect of Harmony's shareholding in
     AHJIC by or on behalf of AHJIC to Harmony, or to any person that directly
     or indirectly controls Harmony, by way of dividend, capital reduction
     (including, but not limited to, any share repurchase), interest, principal,
     fee, royalty, shareholder loan repayment or other distributions or payments
     whether or not made to the shareholders of AHJIC generally;

2.2.7 "EFFECTIVE DATE" shall bear the meaning ascribed to that term in the Sale
     of Shares Agreement;

2.2.8 "FIRST LOAN AGREEMENT" means the written agreement entitled "First Loan
     Agreement" concluded or to be concluded between Nedbank and the Trust on
     or about the Signature Date pursuant to which Nedbank lends and advances an
     amount of R480 400 000
<PAGE>
                                                                         Page 3.

     (Four Hundred and Eighty Million Four Hundred Thousand Rand) to the Trust;

2.2.9 "HARMONY" means Harmony Gold Mining Company Limited

     (Registration No. 1950/038232/06), a public company duly incorporated
     according to the company laws of South Africa;

2.2.10 "HARMONY LOAN AGREEMENT" means the written agreement entitled "Loan
     Agreement" concluded between Nedbank and Harmony on 24 December 2004;

2.2.11 "HARMONY LOAN OUTSTANDINGS" means, at any time and from time to time and
     in respect of the Harmony Loan Agreement, the aggregate of all amounts of
     principal, accrued and unpaid interest and all and any other amounts due
     and payable to Nedbank under the Harmony Loan Agreement;

2.2.12 "NEDBANK" means Nedbank Limited (Registration No. 1951/000009/06) (acting
     through its Nedbank Capital division), a public company and registered bank
     duly incorporated according to the company and banking laws of South
     Africa;

2.2.13 "PARTIES" means:

2.2.13.1 AHJIC;

2.2.13.2 Harmony; and

2.2.13.3 Nedbank,

     and "PARTY" means, as the context requires, either of them;
<PAGE>
                                                                         Page 4.

2.2.14 "SALE OF SHARES AGREEMENT" means the written agreement entitled "Sale of
     Shares Agreement" concluded or to be concluded between Harmony, AHJIC and
     the Trust on or about the Signature Date;

2.2.15 "SIGNATURE DATE" means the date of the signature of the Party last
     signing this Agreement in time;

2.2.16 "SOUTH AFRICA" means the Republic of South Africa as constituted from
     time to time;

2.2.17 "TRUST" means the trustees for the time being of an oral trust
     established by oral agreement between Frank Abbott (as founder) and
     Nedbank, Harmony, Frank Abbott and Deneys Reitz Trustees (Proprietary)
     Limited (each as trustees) on 15 April 2005 and known as the "ARM
     Broad-Based Empowerment Trust".

2.3  Any reference in this Agreement to:

2.3.1 a "clause" shall, subject to any contrary indication, be construed as a
     reference to a clause hereof;

2.3.2 the "control" by one entity of another entity shall be construed so as to
     mean the power of the first such entity to direct the management and the
     policies of the second such entity, whether through the ownership of voting
     capital, by contract or by any other means;

2.3.3 "law" shall be construed as any law (including common or customary law) or
     statute, constitution, decree, judgment, treaty, regulation, directive,
     bye-law, order or any other legislative measure of any government,
     supranational, local government, statutory or regulatory body or court; and
<PAGE>
                                                                         Page 5.

2.3.4 a "person" shall be construed as a reference to any person, firm, company,
     trust, corporation, government, state or agency of a state or any
     association or partnership (whether or not having separate legal
     personality) of two or more of the foregoing.

2.4  Unless inconsistent with the context or save where the contrary is
     expressly indicated:

2.4.1 if any provision in a definition is a substantive provision conferring
     rights or imposing obligations on any Party, notwithstanding that it
     appears only in this interpretation clause, effect shall be given to it as
     if it were a substantive provision of this Agreement;

2.4.2 when any number of days is prescribed in this Agreement, same shall be
     reckoned exclusively of the first and inclusively of the last day unless
     the last day falls on a day which is not a Business Day, in which case the
     last day shall be the next succeeding Business Day;

2.4.3 in the event that the day for payment of any amount due in terms of this
     Agreement should fall on a day which is not a Business Day, the relevant
     day for payment shall be the next succeeding Business Day;

2.4.4 in the event that the day for performance of any obligation to be
     performed in terms of this Agreement should fall on a day which is not a
     Business Day, the relevant day for performance shall be the next succeeding
     Business Day;

2.4.5 any reference in this Agreement to an enactment is to that enactment as at
     the Signature Date and as amended or re-enacted from time to time;
<PAGE>
                                                                         Page 6.

2.4.6 any reference in this Agreement to this Agreement or any other agreement
     or document shall be construed as a reference to this Agreement or, as the
     case may be, such other agreement or document as the same may have been, or
     may from time to time be, amended, varied, novated or supplemented; and

2.4.7 no provision of this Agreement constitutes a stipulation for the benefit
     of any person who is not a Party to this Agreement.

2.5  Unless inconsistent with the context, an expression which denotes:

2.5.1 any one gender includes the other genders;

2.5.2 a natural person includes an artificial person and vice versa; and

2.5.3 the singular includes the plural and vice versa.

2.6  Where any term is defined within the context of any particular clause in
     this Agreement, the term so defined, unless it is clear from the clause in
     question that the term so defined has limited application to the relevant
     clause, shall bear the same meaning as ascribed to it for all purposes in
     terms of this Agreement, notwithstanding that that term has not been
     defined in this interpretation clause.

2.7  The rule of construction that, in the event of ambiguity, the contract
     shall be interpreted against the Party responsible for the drafting
     thereof, shall not apply in the interpretation of this Agreement.

2.8  The expiration or termination of this Agreement shall not affect such of
     the provisions of this Agreement as expressly provide that they will
     operate after any such expiration or termination or which of necessity must
     continue to have effect after such expiration or termination,
<PAGE>
                                                                         Page 7.

     notwithstanding that the clauses themselves do not expressly provide for
     this.

2.9  This Agreement shall be binding on and enforceable by the estates, heirs,
     executors, administrators, trustees, permitted assigns or liquidators of
     the Parties as fully and effectually as if they had signed this Agreement
     in the first instance and reference to any Party shall be deemed to include
     such Party's estate, heirs, executors, administrators, trustees,
     successors-in-title, permitted assigns or liquidators, as the case may be.

2.10 The use of any expression in this Agreement covering a process available
     under South African law such as winding-up (without limitation eiusdem
     generis) shall, if any of the Parties to this Agreement is subject to the
     law of any other jurisdiction, be construed as including any equivalent or
     analogous proceedings under the law of such other jurisdiction.

2.11 Where figures are referred to in numerals and in words, if there is any
     conflict between the two, the words shall prevail.

3.   INTRODUCTION

3.1  Harmony and Nedbank have entered into the Harmony Loan Agreement pursuant
     to which Harmony is indebted to Nedbank.

3.2  Harmony is a shareholder of AHJIC which is proposing to dispose of the ARM
     Shares to the Trust pursuant to the Sale of Shares Agreement.

3.3  The Trust requires funding for the purposes of acquiring the ARM Shares
     pursuant to the Sale of Shares Agreement.

3.4  Nedbank is willing to provide a portion of such funding to the Trust
     pursuant to the First Loan Agreement, provided that Harmony undertakes that
     it will repay in full the Harmony Loan Outstandings immediately
<PAGE>
                                                                         Page 8.

     after the payment of the purchase price by the Trust to AHJIC under the
     Sale of Shares Agreement.

4.   REPAYMENT OF THE HARMONY LOAN OUTSTANDINGS

4.1  Harmony shall pay the Harmony Loan Outstandings in cash to Nedbank on the
     Effective Date without deduction or set-off by electronic transfer into the
     following bank account:

4.1.1 Account Name : Nedbank Capital Project Administration;

4.1.2 Bank : Nedbank Limited;

4.1.3 Account Number: 1979 373 078;

4.1.4 Branch : 100 Main Street;

4.1.5 Branch Code : 19-79-05.

4.2  Harmony shall not withdraw the undertaking given by it in terms of clause
     4.1 prior to 30 May 2005.

4.3  Harmony hereby undertakes in favour of Nedbank that it shall duly and
     promptly comply with any reasonable request, and shall sign all documents
     as may be reasonably required, by Nedbank in order to give effect to the
     payment undertaking given by Harmony in clause 4.1.

4.4  Nedbank acknowledges that the payment by Harmony to Nedbank in accordance
     with the provisions of clause 4.1 shall constitute a valid and proper
     discharge by Harmony of its obligation to pay the Harmony Loan
     Outstandings.
<PAGE>
                                                                         Page 9.

5.   AHJIC UNDERTAKING

5.1  AHJIC hereby irrevocably undertakes in favour of Nedbank that on the
     Effective Date, AHJIC will make a Distribution to Harmony in an amount not
     being less than the amount of the Harmony Loan Outstandings.

5.2  AHJIC hereby undertakes in favour of Nedbank that it shall (to the extent
     required of it) duly and promptly comply with any reasonable request, and
     shall sign all documents as may be reasonably required, by Nedbank in order
     to give effect to the payment undertaking given by Harmony in clause 4.1.

6.   REPRESENTATIONS AND WARRANTIES

6.1  Harmony hereby represents and warrants in favour of Nedbank on the
     Signature Date, on each day between the Signature Date and the Effective
     Date and on the Effective Date that:

6.1.1 Harmony is a public company duly organised and existing under the laws of
     South Africa with the power and authority to enter into and to exercise its
     rights and perform its obligations under this Agreement;

6.1.2 Harmony has procured the taking of all necessary corporate and other
     action to authorise the execution of this Agreement;

6.1.3 this Agreement is legal and binding on, and enforceable against, Harmony
     in accordance with its terms;

6.1.4 the provisions of this Agreement are not in material conflict with, and
     will not constitute a breach of the provisions of, any other agreement or
     undertaking which is binding on Harmony; and
<PAGE>
                                                                        Page 10.

6.1.5 Harmony is fully acquainted with the contents, meaning and import of the
     First Loan Agreement.

6.2  AHJIC hereby represents and warrants in favour of Nedbank on the Signature
     Date, on each day between the Signature Date and the Effective Date and on
     the Effective Date that:

6.2.1 AHJIC is a private company duly organised and existing under the laws of
     South Africa with the power and authority to enter into and to exercise its
     rights and perform its obligations under this Agreement;

6.2.2 AHJIC has procured the taking of all necessary corporate and other action
     to authorise the execution of this Agreement;

6.2.3 this Agreement is legal and binding on, and enforceable against, AHJIC in
     accordance with its terms;

6.2.4 the provisions of this Agreement are not in material conflict with, and
     will not constitute a breach of the provisions of, any other agreement or
     undertaking which is binding on AHJIC; and

6.2.5 AHJIC is fully acquainted with the contents, meaning and import of the
     First Loan Agreement.

6.3  Each of the representations and warranties given by Harmony and AHJIC in
     terms of clauses 6.1 and 6.2 shall:

6.3.1 prima facie be deemed to be a representation of act inducing Nedbank to
     enter into this Agreement and the First Loan Agreement;

6.3.2 be presumed to be material unless the contrary is proved;
<PAGE>
                                                                        Page 11.

6.3.3 insofar as any of the representations or Warranties is promissory or
     relates to a future event, be deemed to have been given as at the due date
     for fulfilment of the promise or for the happening of the event, as the
     case may be; and

6.3.4 be a separate representation or warranty and in no way be limited or
     restricted by reference to or inference from the terms of any other
     representation or warranty.

6.4  Nedbank is entering into this Agreement and the First Loan Agreement
     relying upon the representations and warranties given by Harmony and AHJIC
     in clauses 6.1 and 6.2.

7.   BREACH

     If any Party commits a breach or fails in the observance of any of the
     terms and conditions hereof and fails to remedy such default or breach
     within 14 (fourteen) days of delivery of written notice requiring it so to
     do, then the non-defaulting Party shall be entitled to cancel this
     Agreement against the defaulting Party or to claim immediate payment and/or
     performance by the defaulting Party of all of the defaulting Party's
     obligations whether or not the due date for payment and/or performance
     shall have arrived, in either event without prejudice to the non-defaulting
     Party's rights to claim damages. The aforegoing is without prejudice to
     such other rights as the non-defaulting Party may have at law; provided
     always that, notwithstanding anything to the contrary contained in this
     Agreement, the non-defaulting Party shall not be entitled to cancel this
     Agreement, for any breach by the defaulting Party unless such breach is a
     material breach going to the root of this Agreement and is incapable of
     being remedied by a payment in money, or if it is capable of being remedied
     by a payment in money, the defaulting Party fails to pay the amount
     concerned within 14 (fourteen) days after such amount has been determined.
<PAGE>
                                                                        Page 12.

8.   CONFIDENTIALITY

8.1  None of the Parties shall issue any press release or any other public
     document or make any public statement, in each case relating to or
     connected with or arising out of the agreement or the matters contained
     therein (save for any such release, announcement or document which is
     required to be given, made or published by law or under the rules and
     regulations of any stock exchange) without obtaining the prior approval of
     the other Parties to the contents thereof and the manner of its
     presentation and publication; provided that such approval shall not to be
     unreasonably withheld or delayed.

8.2  In the case of a release, announcement or document which is required to be
     given, made or published by law or under the rules and regulations of any
     stock exchange, the Party liable so to give, make or publish the same shall
     give to the other Parties as much advance warning thereof as is reasonable
     in the circumstances together with drafts or a copy thereof as soon as it
     is at liberty so to do.

8.3  Each Party shall at all times keep confidential (and to ensure that its
     employees and agents shall keep confidential) any information which it has
     acquired or may acquire in relation to the other Parties or to any matter
     arising from or in connection with this Agreement, save for any
     information:

8.3.1 which is publicly available or becomes publicly available through no act
     or default of any Party; or

8.3.2 which was in the possession of that Party prior to its disclosure
     otherwise than as a result of any breach by a Party of any obligation of
     confidentiality owed to the other Parties whether pursuant to this
     Agreement or otherwise; or
<PAGE>
                                                                        Page 13.

8.3.3 which is disclosed to that Party by a third party which did not acquire
     the information under an obligation of confidentiality; or

8.3.4 which is independently acquired by that Party as a result of work carried
     out by a person to whom no disclosure of such information has been made,

     and shall not use or disclose such information except:

8.3.5 with the consent of the other Parties; or

8.3.6 in accordance with an order of court of competent jurisdiction; or

8.3.7 in order to comply with any law or governmental regulations by which the
     Party concerned is bound; or

8.3.8 where necessary for the purpose of enforcing its rights under this
     Agreement.

8.4  The provisions of this clause 8 shall survive any termination of this
     Agreement.

9.   NOTICES AND DOMICILIA

9.1  NOTICES

9.1.1 Each Party chooses the address set out opposite its name below as its
     address to which any written notice in connection with this Agreement may
     be addressed.
<PAGE>
                                                                        Page 14.

9.1.1.1 HARMONY: Block 27
                 Randfontein Office Park
                 Corner Main Reef Road and Ward Avenue
                 RANDFONTEIN

                 Telefax No. : (011) 411 2398
                 Attention : The Company Secretary

9.1.1.2 AHJIC:   Block 27
                 Randfontein Office Park
                 Corner Main Reef Road and Ward Avenue
                 RANDFONTEIN

                 Telefax No. : (011) 411 2398
                 Attention : The Company Secretary

9.1.1.3 NEDBANK: 4th Floor, F Block
                 135 Rivonia Road
                 Sandown
                 SANDTON
                 2057

                 Telefax No. : (011) 294 8421
                 Attention : Head of Specialised Finance

9.1.2 Any notice or communication required or permitted to be given in terms of
     this Agreement shall be valid and effective only if in writing but it shall
     be competent to give notice by telefax transmitted to its telefax number
     set out opposite its name above.

9.1.3 Any Party may by written notice to the other Parties change its chosen
     address and/or telefax number for the purposes of clause 9.1.1 to any other
     address(es) and/or telefax number, provided that the change shall become
     effective on the 14th (fourteenth) day after the receipt of the notice by
     the addressee.

9.1.4 Any notice given in terms of this Agreement shall:
<PAGE>
                                                                        Page 15.

9.1.4.1 if delivered by hand be deemed to have been received by the addressee on
     the date of delivery;

9.1.4.2 if transmitted by facsimile be deemed to have been received by the
     addressee on the 1st (first) Business Day after the date of transmission,

     unless the contrary is proved.

9.1.5 Notwithstanding anything to the contrary herein contained, a written
     notice or communication actually received by a Party shall be an adequate
     written notice or communication to it, notwithstanding that it was not sent
     to or delivered at its chosen address and/or telefax number.

9.2  DOMICILIA

9.2.1 Each of the Parties chooses its physical address referred to in clause 9.1
     as its domicilium citandi et executandi at which documents in legal
     proceedings in connection with this Agreement may be served.

9.2.2 Any Party may by written notice to the other Parties change its domicilium
     from time to time to another address, not being a post office box or a
     poste restante, in South Africa; provided that any such change shall only
     be effective on the 14th (fourteenth) day after deemed receipt of the
     notice by the other Parties pursuant to clause 9.1.4.

10.  GOVERNING LAW

     The entire provisions of this Agreement shall be governed by and construed
     in accordance with the laws of South Africa.
<PAGE>
                                                                        Page 16.

11.  JURISDICTION

     The Parties hereby irrevocably and unconditionally consent to the
     non-exclusive jurisdiction of the Witwatersrand Local Division of the High
     Court of South Africa (or any successor to that division) in regard to all
     matters arising from this Agreement.

12.  SEVERABILITY

     Each provision in this Agreement is severable from all others,
     notwithstanding the manner in which they may be linked together or grouped
     grammatically, and if in terms of any judgment or order, any provision,
     phrase, sentence, paragraph or clause is found to be defective or
     unenforceable for any reason, the remaining provisions, phrases, sentences,
     paragraphs and clauses shall nevertheless continue to be of full force. In
     particular, and without limiting the generality of the aforegoing, the
     Parties acknowledge their intention to continue to be bound by this
     Agreement notwithstanding that any provision may be found to be
     unenforceable or void or voidable, in which event the provision concerned
     shall be severed from the other provisions, each of which shall continue to
     be of full force.

13.  GENERAL

13.1 This document constitutes the sole record of the agreement between the
     Parties in regard to the subject matter thereof.

13.2 No Party shall be bound by any express or implied term, representation,
     warranty, promise or the like, not recorded herein.

13.3 No addition to, variation or consensual cancellation of this Agreement and
     no extension of time, waiver or relaxation or suspension of any of the
     provisions or terms of this Agreement shall be of any force or effect
     unless in writing and signed by or on behalf of all the Parties.
<PAGE>
                                                                        Page 17.

13.4 No latitude, extension of time or other indulgence which may be given or
     allowed by any Party to any other Party in respect of the performance of
     any obligation hereunder or enforcement of any right arising from this
     Agreement and no single or partial exercise of any right by any Party shall
     under any circumstances be construed to be an implied consent by such Party
     or operate as a waiver or a novation of, or otherwise affect any of that
     Party's rights in terms of or arising from this Agreement or estop such
     Party from enforcing, at any time and without notice, strict and punctual
     compliance with each and every provision or term hereof.

13.5 The Parties undertake at all times to do all such things, to perform all
     such acts and to take all such steps and to procure the doing of all such
     things, the performance of all such actions and the taking of all such
     steps as may be open to them and necessary for or incidental to the putting
     into effect or maintenance of the terms, conditions and import of this
     Agreement.

13.6 Save as is specifically provided in this Agreement, no Party shall be
     entitled to cede or delegate any of its rights or obligations under this
     Agreement without the prior written consent of the other Parties affected
     by such transfer of rights or obligations, which consent may not
     unreasonably be withheld or delayed.

14.  COSTS

14.1 The costs and expenses of and incidental to the negotiation, preparation
     and execution of this Agreement and the implementation of the transactions
     contemplated herein shall be paid in accordance with the terms of the First
     Loan Agreement.

14.2 All legal costs incurred by any Party in consequence of any default of the
     provisions of this Agreement by any other Party shall be payable on demand
     by the defaulting Party on the scale as between attorney and own
<PAGE>
                                                                        Page 18.

     client and shall include collection charges, the costs incurred by the
     non-defaulting Party in endeavouring to enforce such rights prior to the
     institution of legal proceedings and the costs incurred in connection with
     the satisfaction or enforcement of any judgement awarded in favour of the
     non-defaulting Party in relation to its rights in terms of or arising out
     of this Agreement.

15.  COUNTERPARTS

     This Agreement may be executed by each Party signing a separate copy
     thereof and each of the copies together shall constitute the Agreement of
     the Parties.

SIGNED at SANDTON on this the 15th day of APRIL 2005.

                                        For and on behalf of
                                        HARMONY GOLD MINING COMPANY LIMITED

                                        /s/ Nomfundo Qangule
                                        ----------------------------------------
                                        Name: Nomfundo Qangule
                                        Capacity: Director
                                        Who warrants her authority hereto

SIGNED at SANDTON on this the 15th day of APRIL 2005.

                                        For and on behalf of
                                        ARMGOLD HARMONY JOINT INVESTMENT COMPANY
                                        (PROPRIETARY) LIMITED

                                        /s/ Frank Abbott
                                        ----------------------------------------
                                        Name: Frank Abbott
                                        Capacity: Director
                                        Who warrants his authority hereto
<PAGE>
                                                                        Page 19.

SIGNED at SANDTON on this the 15th day of APRIL 2005

                                        For and on behalf of
                                        NEDBANK LIMITED (ACTING THROUGH ITS
                                        NEDBANK CAPITAL DIVISION)

                                        /s/ Kevin Ryder
                                        ----------------------------------------
                                        Name: Kevin Ryder
                                        Capacity: Authorised Signatory
                                        Who warrants his authority hereto

                                        /s/ Mark Saunders Tyler
                                        ----------------------------------------
                                        Name: Mark Saunders Tyler
                                        Capacity: Authorised Signatory
                                        Who warrants his authority heretoExhibit 10.1
 

 

EMPLOYMENT AGREEMENT

 

THIS AGREEMENT is dated as of October 6, 2005 (“Effective Date”) between ALLIANCE FINANCIAL CORPORATION (“Corporation”), ALLIANCE BANK,N.A. (“Bank”) (collectively “Alliance”) having a principal place of business at 120 Madison Street, Syracuse, New York 13202, and JOHN H. WATT, JR., residing at 42 Monroe Avenue, Pittsford, New York 14534, the (“Executive”).

 

The Corporation and the Executive desire to set forth the terms upon which the Executive will continue to be employed by the Corporation and the Bank after the expiration on October 6, 2005 of the Executive’s existing Employment Agreement dated January 21, 2004.

 

	1. 	  	      Definitions 

	
             
  	
            (a)
 	
            “Cause” means a finding by the Board of Directors of the Corporation (the “Board of Directors) that any of the following conditions exist:  (i) the Executive’s willful and continued failure to substantially perform his duties under this Agreement (other than as a result of Disability) that is not or cannot be cured within 30 days of Alliance giving Executive notice of the failure to perform. In the case of termination of the Executive within 6 months after a Change in Control, no act or failure to act will be deemed “willful” unless effected by the Executive not in good faith and without a reasonable belief that his action or failure to act was in or not opposed to the best interests to Alliance or its successor; (ii) a willful act or omission by the Executive constituting dishonesty, fraud,
or other malfeasance, and any act or omission by the Executive constituting immoral conduct, which is injurious to the financial condition or business of Alliance; (iii) the Executive’s indictment for a felony offense under the laws of the United States or any state; or (iv) breach by the Executive of the restrictive covenant in Section 6(a) hereof.
 

	
             
  	
            (b)
 	
            “Change in Control” means:
 

 

	
             
  	
            (i)
 	
            any acquisition or series of acquisitions by any Person other than the Corporation, any of its affiliates, any executive benefit plan of the Corporation or its affiliates or any Person holding common shares of the Corporation for or pursuant to the terms of such an executive benefit plan, that
 

 

	
             
  	
            (a)
 	
            results in that Person becoming the beneficial owner (as defined in Rule 13d-3 under the Securities Act of 1934, as amended (the “Exchange Act”)), directly or indirectly, of securities of the Corporation representing 30% or more of either the then outstanding shares of common stock of the Corporation (“Outstanding Corporation Common Stock”) or the combined voting power of the Corporation’s then outstanding securities entitled to then vote in the election of the Corporation’s directors (“Outstanding Corporation Voting Securities”) except that any such acquisition of Outstanding Corporation Voting Securities will not constitute a Change in Control while that Person does not exercise voting power of its Outstanding Corporation Voting Stock or otherwise exercise control with respect to any matter concerning or affecting the
Corporation, or Outstanding 
 

 

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Corporation Voting Securities, and promptly sells, transfers, assigns or otherwise disposes of that number of shares of Outstanding Corporation Common Stock necessary to reduce its beneficial ownership (as defined in Rule 13d-3 under the Exchange Act) of the Outstanding Corporation Common Stock to below 30%;

 

	
             
  	
            (b)
 	
            would be required to be reported in response to Item 5.01 of the Current Report on Form 8-K, pursuant to Section 13 or 15(d) of the Exchange Act.
 

 

	
             
  	
            (ii)
 	
            At any time when, during any period not longer than 24 consecutive months, individuals who at the beginning of the period constitute the Board of Directors cease to constitute a majority of the board, unless the election or nomination for the election by the Corporation’s shareholders of each new board member was approved by a vote of at least 2/3 of the board members still in office who were board members at the beginning of that period (including, for these purposes, new members whose election or nomination was so approved);
 

 

	
             
  	
            (iii)
 	
            approval by the shareholders of the Corporation of:
 

 

	
             
  	
            (a)
 	
            a dissolution or liquidation of the Corporation,
 

 

	
             
  	
            (b)
 	
            a sale of substantially all of the assets or earning power of the Corporation o an unrelated party,
 

 

	
             
  	
            (c)
 	
            an agreement to merge or consolidate or otherwise reorganize, with or into one or more unrelated Persons, as a result of which less than 75% of the outstanding securities of the surviving or resulting entity are or will be owned by the shareholders of the Corporation immediately before such merger, consolidation or reorganization,
 

 

	
             
  	
            (iv)
 	
            a tender offer is made for 30% or more of the Outstanding Corporation Voting Securities and shareholders owning beneficially or of record more than 30% or more of the Outstanding Corporation Voting Securities have tendered or offered to sell their shares pursuant to that tender offer, at the time those shares have been accepted by the tender offer; provided, however, that 
 

 

	
             
  	
            (v)
 	
            a Change in Control will not be deemed to have occurred under any of the preceding subparagraphs if the action (agreement, acquisition or other) is approved by a majority of the Board of Directors, the Corporation is the resulting entity, and at least 51% of the ownership of voting control of the Corporation remains unchanged from the ownership immediately prior to such action.
 

 

	
            (c)
 	
            “Disability” means:
 

 

Long term disability as defined in Alliance’s long term disability policy covering the Executive or if not so defined in such a plan than by a determination by a qualified independent physician selected by the Executive and Alliance which such determination shall be deemed to be final. In the event of Disability the Executive will cease to be employed on the last day of the month in which the Executive’s disability is determined in writing.

	
            (d)
 	
            “Good Reason” means any of the following circumstances:
 

 

	
             
  	
            (i)
 	
            A significant reduction in the scope of the Executive’s duties.
 

 

	
             
  	
            (ii)
 	
            Removal from, or failure to re-elect the Executive to the position of Executive Vice President of Alliance’s ultimate parent entity.
 

 

 

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            (iii)
 	
            A material breach of this Agreement by Alliance that is not or cannot be cured within 30 days of the Executive giving notice of the breach.
 

 

	
             
  	
            (iv)
 	
            A Constructive Termination occurs within twelve months subsequent to the occurrence of a Change of Control.
 

 

	
             
  	
            (v)
 	
            The Executive no longer reports directly to the Chief Executive Officer of the Corporation or its successor
 

 

	
             
  	
            (e)
 	
            “Person” has the meaning given to that term in Sections 13 (d) and 14(d) of the Exchange Act, but excluding any Person described in and satisfying the conditions of Rule 13 d-1(b)(1) of Section 13.
 

 

	
             
 	
            (f)
 	
            “Constructive Termination” shall mean Termination of Executive’s employment by the Executive subsequent to the occurrence of:  (A) a significant change in the nature or scope of the Executive’s authority (such as a change in his status or authority as an officer of the ultimate parent corporation in a corporate group) from that prior to a Change of Control, (B) any reduction in the Executive’s total compensation (including bonuses and benefits) from that prior to a Change or Control, or (C) a change in the general location where the Executive is required to perform services from that prior to a Change of Control.
 

 

	
            2.
 	
            Alliance employs the Executive, and the Executive accepts employment upon the terms and conditions of this Agreement as Executive Vice President of the Corporation and of the Bank, in full charge of the operation of the businesses assigned to the Executive from time to time and including without limitation as of the date hereof the Bank’s commercial, trust and investment management and leasing businesses.  In addition the Executive will engage in certain strategic planning duties on behalf of the Corporation.  The foregoing employment is subject to the provisions of the by-laws of Alliance in respect of the duties assigned from time to time by the Boards of Directors, and also subject at all times to the control of the Boards of Directors.  Subject to the yearly election by the Board of Directors in the exercise of their
judgment and consistent with other provisions of this Agreement, the Executive will continue to be elected to the position of Executive Vice President of both the Corporation and the Bank.  The Executive will perform and discharge those responsibilities which are commensurate with his position.  The Executive agrees to perform his duties and discharge his responsibilities in a faithful manner and to the best of his ability.  The Executive may not accept other gainful employment but he may become a director, trustee or other fiduciary of other corporations, all with the prior consent of the Boards of Directors.
 

 

	
            3.
 	
            The period of employment of the Executive under this Agreement is the period beginning on the Effective Date and ending 36 months after the Effective Date. However on the expiration of the initial 12-month period beginning on the Effective Date, and on the expiration of the 12-month period after that date (that date and expiration of each 12-month period after that date is referred to as the “Renewal Date”), unless previously terminated, the term will be automatically extended for 12 months, unless prior to the October 1 immediately preceding the Renewal Date Alliance gives notice to the Executive that the term will not be extended.
 

 

 

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Notwithstanding the foregoing:

	
             
  	
            (a)
 	
            The Executive’s employment will terminate automatically upon death or Disability of the Executive, subject to the duty of Alliance to provide reasonable accommodation under the Americans with Disabilities Act.
 

 

	
             
  	
            (b)
 	
            Alliance, at its sole option, may terminate the employment of the Executive at any time for any reason by delivering 60 days’ prior written notice to the Executive,
 

 

	
             
  	
            (c)
 	
            Alliance, at its sole option, may terminate the employment of the Executive at any time for Cause by delivering 60 days’ prior written notice to the Executive.
 

 

	
             
  	
            (d)
 	
            The Executive, at his sole option, may terminate his employment for Good Reason by providing 60 days’ prior written notice to Alliance.
 

 

	
             
  	
            (e)
 	
            The Executive, at his sole option, may terminate his employment absent Good Reason by providing 60 days’ prior written notice to Alliance.
 

 

Any notice of termination given by either party must specify the particular termination provision of this Agreement under which notice is being given in reasonable detail.

 

	
            4.
 	
            Alliance shall pay the Executive for all services rendered a base salary of $155,000 per year, payable in equal bi-weekly installments.  Salary payments shall be subject to withholding and other applicable taxes.  On an annual basis, the Compensation Committee of the Corporation’s Board of Directors will review the base salary of the Executive to consider appropriate increases in the base salary and make recommendations to the Corporation’s Board of Directors with respect thereto.  During the term of this Agreement the Employee will be entitled to receive an annual cash bonus calculated pursuant to Alliance’s incentive programs in effect from time to time.  The Board of Directors, in its sole discretion, may award bonuses to the Executive in addition to those above, as it may from time to time determine.
 

 

	
            5.
 	
            The Executive will report directly at all times to the Chief Executive Officer of the Corporation.
 

 

	
            6.
 	
            Relative to confidential information and trade secrets belonging to Alliance, Alliance and the Executive agree as follows:
 

 

	
             
  	
            (a)
 	
            During the term of this Agreement, the Executive may have access to, and become familiar with, various trade secrets and confidential information belonging to Alliance.  The Executive acknowledges that such confidential information and trade secrets are owned, and shall continue to be owned, solely by Alliance.  During the term of  his employment and for six months thereafter, if such employment terminates without Cause, or for twelve months thereafter, if such employment terminates for Cause, the Executive agrees not to use, communicate, reveal, or otherwise make available such information for any purpose whatsoever, or to divulge such information to any person, partnership, corporation or entity other than Alliance or persons expressly designated by Alliance, unless the Executive is compelled to disclose such information by judicial process.
 

 

	
             
  	
            (b)
 	
            For a period of six months after this Agreement has been terminated without Cause, or for twelve months after this Agreement has been terminated for Cause, regardless of whether the termination is initiated by Alliance or the Executive, the Executive agrees that he will not, directly or indirectly, solicit any person, company, firm or corporation who is or was a customer of Alliance during a period of one year  prior to termination of the Executive’s  
 

 

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employment or who was solicited by the Executive during his period of employment.   The Executive agrees not to solicit such customers on behalf of himself or any other person, firm, company or corporation.

 

	
             
  	
            (c)
 	
            The Executive agrees for a period of six months after termination of his employment without Cause, or for twelve months after the termination of his employment for Cause, he will not accept employment with a direct competitor, or enter into direct competition with Alliance, either by himself or through any entity owned or managed in whole or in part by the Executive anywhere within the State of New York except for the New York City metropolitan statistical area.
 

 

	
             
  	
            (d)
 	
            The Executive acknowledges that compliance with this paragraph is necessary to protect Alliance’s business and good will and that a breach of the clauses contained herein may irreparably and continually damage Alliance, and that an award of money damages may not be adequate to compensate for such harm.  Consequently, the Executive agrees that in the event he intentionally breaches or threatens to breach any of these covenants, Alliance shall be entitled to both a preliminary or permanent injunction, without the posting of bond or other security, in order to prevent continuation of such harm and money damages, insofar as they can be determined, including, without limitation, all reasonable costs and attorney’s fees incurred by Alliance in enforcing the provisions of this Agreement.  Nothing in this Agreement, however, shall prohibit Alliance from also
pursuing any other remedy.
 

 

	
            7.
 	
            Alliance shall provide, and the Executive shall be entitled to receive, the benefits, including without limitation, health and medical benefit plans, any pension, profit sharing and retirement plans, and any insurance policies or programs offered to executives of Alliance from time to time provided to all executives.  In addition to the above benefits, the Executive shall be entitled to receive from Alliance, and Alliance shall provide to the Executive the following:
 

 

	
             
  	
            (a)
 	
            The use of an automobile provided by Alliance.  All normal expenses incurred in connection with the purchase or lease and business use of such automobile shall be borne by Alliance.  The automobile shall be selected by the Executive with the concurrence of Alliance.  The Executive shall take proper care of such vehicle, and shall be responsible for all damage to the same resulting from any misuse or neglect.  Alliance shall also, at its own expense, provide comprehensive insurance coverage for the vehicle, naming the Executive as a named insured.  Upon termination of employment for any reason whatsoever, the Executive shall deliver the automobile to Alliance at Alliance’s place of business.
 

 

	
             
  	
            (b)
 	
            Membership fees in a private club to be selected by the Executive with the concurrence of Alliance.
 

 

	
             
  	
            (c)
 	
            Four weeks of paid vacation per year.
 

 

	
            8.
 	
            Alliance will provide the following benefits upon termination of the Executive’s employment, in each case subject to applicable withholding requirements.
 

 

	
             
  	
            (a)
 	
            Upon termination of his employment by the Executive for Good Reason or termination of the Executive’s employment by Alliance (or its successor) for any reason other than death, Disability or Cause, the Executive will be entitled to receive from Alliance an amount equal to two times his average annual taxable compensation for the three most recent taxable years (or such shorter period of Executive’s employment by Alliance on an annualized basis) (“Average Taxable Compensation”) in a lump sum paid in the month following the actual termination of employment of the Executive.  The parties agree that, for purposes of this calculation, for 2003,  2004 and 2005 Executive’s taxable compensation was $150,000, $150,000 and $185,000, respectively.  If the Executive dies prior to such payment then such payment shall be made to his spouse, if she survives him, and if not, to the estate of the Executive.  In addition, in the event of such termination all unvested restricted stock grants, stock options and similar grants in favor of Executive pursuant to past existing or future compensation plans will vest on the date of termination.
 

 

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            (b)
 	
            Upon the termination of the Executive’s employment by the Executive absent Good Reason or by Alliance for Cause, the Executive shall receive his salary and fringe benefits through his termination date as well as an amount equal to his accrued and unused vacation days in a lump sum.
 

 

	
             
  	
            (c)
 	
            Upon termination of the Executive due to Disability, the Executive shall receive his base salary in effect on the date immediately before the Disability for the greater of (i) the remaining term of this Agreement or (ii) 6 months, in either case reduced by any disability insurance payments made to Executive on Alliance-paid insurance polices.  In addition Executive will receive an amount equal to his accrued and unpaid vacation pay if terminated due to Disability.
 

 

	
             
  	
            (d)
 	
            Upon termination due to death, the Executive’s spouse, if surviving, or if not his estate, shall receive the salary in place on the date of death through the end of the calendar month in which the death occurred plus an amount equal to his accrued and unpaid vacation days on a lump sum basis.
 

 

The Executive shall not be obligated to seek other employment or take other action to mitigate amounts payable under this Section 8 or any other section of this Agreement.

 

	
            9.
 	
            Any controversy or claim arising out of or relating to, this Agreement, or its breach, shall be settled by arbitration in the City of Syracuse, New York, in accordance with the then governing rules of the American Arbitration Association.  Judgment upon the award rendered may be entered and enforced in any court of competent jurisdiction.
 

 

	
            10.
 	
            Any notice required or desired to be given under this Agreement shall be deemed given, if in writing sent by Certified Mail-Return Receipt Requested to the Executive’s residence or to the Alliance’s office to the attention of the Chief Executive Officer, as the case may be.
 

 

	
            11.
 	
            Alliance will provide the Executive with coverage under Alliance’s standard directors and officers liability insurance policy at its expense and will indemnify the Executive to the fullest extent permitted under and subject to the terms and conditions of federal and state law, against all expenses and liabilities incurred by the Executive  in connection with or arising out of any action, suit or proceeding in which he may be involved by reason of his having been a director or officer of Alliance.
 

 

	
            12.
 	
            Alliance will require any successor (whether by acquisition of assets, merger, consolidation or otherwise) to all or substantially all of the operations or assets of the Corporation or the Bank, without regard to the form of such acquisition, to assume and agree to perform this Agreement in the same manner and to the same extent that Alliance would have been required to perform if no succession had taken place.
 

 

	
            13.
 	
            Alliance’s waiver of a breach of any provision of this Agreement by the Executive shall be operate or construed as a waiver of any subsequent breach by the Executive.  No waiver shall be valid unless in writing and signed by an authorized officer of the Employer.
 

 

 

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            14.
 	
            The Executive acknowledges that his services are unique and personal: accordingly, the Executive may not assign his rights or delegate his duties or obligations under this Agreement.  Alliance’s rights and obligations under this Agreement shall inure to the benefit of, and shall be binding upon, Alliance’s successors and assigns.
 

 

	
            15.
 	
            This Agreement contains the entire understanding of the parties except with respect to related incentive compensation agreements and plans.  Without limiting the foregoing, this Agreement supersedes the Employment Agreement between the parties dated January 21, 2004 and the last sentence of Section 8(a) supersedes the terms of each restricted stock agreement between the parties.  It may not be changed orally, but only by an agreement in writing signed by the party against whom enforcement of any waiver, change, modification, extension or discharge is sought.
 

 

	
            16.
 	
            This Agreement may be executed in two or more counterparts, each of which shall be deemed original, but all of which together shall constitute one and the same instrument.  
 

 

	
            17.
 	
            This Agreement shall be subject to and governed by the laws of the State of New York.
 

 

IN WITNESS WHEREOF, the parties hereunto executed this Agreement on November 2, 2005.

 

Alliance Financial Corporation

ALLIANCE BANK, N.A.

 

By: /s/ Jack H. Webb

	
             
 	
            President and Chief Executive Officer
 

 

 

/s/ John H. Watt. Jr.  

	
             
 	
            John H.  Watt, Jr., Executive
 

 

 

 

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