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SATSA BONDING SCHEME INFORMATION

FINANCIAL GUARANTEE FOR SOUTHERN AFRICA TOURISM SERVICES ASSOCIATION

THE PARTIES
The parties to this Financial Guarantee (“the Guarantee”) are Lombard Insurance Company Limited (“LOMBARD”) and Southern Africa Tourism Services Association (“SATSA”).

COVER
On payment of the applicable premium and subject to the terms, conditions and exclusions of the Guarantee, LOMBARD will during the Period of Guarantee indemnify SATSA against Loss incurred, arising from the Insolvency of a Member.

DEFINITIONS AND EXPLANATIONS
Appendix A: Refers to this attachment that details the Regulations of SATSA.
Insolvency: For the purposes of the Guarantee a Member shall be insolvent when it has ceased to trade as a result of any of the following steps having being taken against the Member:
1. A bankruptcy order has been made by the Court
2. An administration order has been made by the Court.
Losses: This shall refer to the losses incurred by any person having paid for services or products to be provided by a SATSA Member who is subsequently declared Insolvent before providing those services or products. The losses shall be limited to the lesser of the amount paid to the Insolvent Member, or the cost to complete the tour or services or provide the product. All other losses incurred for which no deposit was paid as well as further losses arising from the Insolvency of the Member are excluded from the Guarantee.
Maximum Indemnity: Refers to the maximum amount for which LOMBARD shall indemnify SATSA in terms of the Guarantee.
Member: Refers to Members of SATSA which Members have been disclosed:
1. On a Bordereau prior to the commencement of the Guarantee; or
2. Within 7 (seven) days of the end of the month during which any change in membership occurs.

Minor Expenses: Expenses incurred that, in aggregate, total 2% (two percent) of the Maximum Indemnity.
Salvage: Refers to money, including any type of dividend paid and/or payable, securities, indemnities, rights of action, counterclaim or set off or any other asset or advantage held, received by, due or otherwise available to a Member of SATSA for the purpose of reducing the Loss.

PERIOD OF THE GUARANTEE
This Guarantee will be valid for a period of twelve months from the Date of Commencement stated on the Schedule.

PREMIUM
1. The premium shall be paid in full and in advance.
2. The amount payable is stated in the Schedule.

CANCELLATION
The Guarantee may be cancelled by either party where:
1. SATSA changes Appendix A. In particular this shall include a relaxation of the Terms of Membership stated in Appendix A.
2. SATSA changes from its current statutory form.

OBLIGATIONS OF SATSA
The SATSA shall:
1 Strictly apply its Membership requirements as stated in Appendix A.
2 SATSA shall have disclosed all its members to LOMBARD prior to the commencement of the Guarantee.
3 Notify LOMBARD within 7 (seven) days of the end of the month during which any change in membership occurs.
4 Immediately notify LOMBARD in writing where SATSA knows or has reason to believe that a Member is or will be in financial difficulties.
5 Immediately notify LOMBARD in writing of the failure of the Member.
6 Immediately notify LOMBARD in writing of all losses incurred as a result of the failure.
7 Take all reasonable steps to mitigate its loss, including first requesting other Members to fulfil the obligations of the Insolvent Member at no additional cost to the Insolvent Member, SATSA or LOMBARD.
8 Obtain the written consent of LOMBARD prior to incurring any costs for which LOMBARD may be liable. Minor Expenses may be incurred without reference to LOMBARD.
9 Ensure that where it undertakes to complete an Insolvent Member’s obligations, it shall do so on the same terms and conditions as the Insolvent Member had undertaken to provide.

CLAIMS
1. SATSA shall lodge a claim within 30 (thirty) days of the Insolvency of the Member.
2. SATSA shall furnish LOMBARD with all documentary evidence:
2.1 Necessary to substantiate the claim within 90 days of date of Insolvency.
2.2 Of Insolvency
2.3 Of the efforts of SATSA to recover money from the Insolvent Member.
2.4 Efforts of SATSA to mitigate the Loss.

LIMITATION OF LIABILITY
1. The extent to which LOMBARD shall be liable is limited to the Maximum Indemnity set out in the Schedule.
2. Liability shall be further limited by:
2.1 Any monies recovered by other Members of SATSA from a tour operator, service or product provider contracted previously with an Insolvent Member
2.2 Any salvage and any liquidation dividend.

SALVAGE
1. Salvage recovered prior to settlement of a claim shall reduce the liability of LOMBARD in respect of the claim.
2. Salvage recovered after settlement of a claim shall be paid to LOMBARD.

CONDITIONS
1. The Members shall be South African registered/domiciled entities.
2. SATSA shall permit LOMBARD access to examine and copy any documents within the control of SATSA and relevant to the Guarantee or to any claim arising or in connection with the Guarantee.
3. LOMBARD reserves the right to audit the SATSA at any time subject to fourteen (14) Days notice. SATSA shall, on request by LOMBARD, make available all the relevant documentation.
4. Where LOMBARD agrees to settle the claim, SATSA shall subrogate all rights and remedies to LOMBARD.

EXCLUSIONS
The Guarantee shall not cover any claim where:
1. The claim arises or is connected to circumstance existing prior to the Commencement Date of the Period of the Guarantee.
2. The claim is lodged 30 (thirty) days after the expiry of the Period of the Guarantee.
3. The Insolvent Member is not formally noted by the SATSA as a Member in a register of members or similar document.
4. The Insolvent Member has been a Member of SATSA for less than 90 (ninety) days at the time the Member is declared insolvent.
5. The claim arises from or is connected to tours, services or products that are booked or purchased after the date of the Insolvency of the Member.
6. The claim arises from or is connected to tours, services or products for which full or part payment has not been received.
7. SATSA is entitled to indemnity under any other insurance or guarantee.
8. The claim arises directly or indirectly from any dishonesty, fraud or malicious conduct of SATSA or the employees of SATSA.
9. The claim arose or is connected to war, invasion, acts of foreign enemies, hostilities (whether war be declared or not), civil war, acts of any terrorist group riots strikes, civil commotion, rebellion, insurrection, or military or usurped power.
10. The claim arose or is connected either directly or indirectly to ionising radiation or contamination by radioactive, toxic, explosive or other hazardous properties of any explosive nuclear assembly or nuclear component thereof.

WHOLE AGREEMENT
The Guarantee, Schedule and Appendix A are the whole agreement between the parties.

WARRANTY
1. SATSA warrants that the statements made in the Proposal were true at the date of the Proposal and at the date LOMBARD agreed to issue the Guarantee.
2. SATSA warrants that it has and will continue to disclose all material facts and circumstances to LOMBARD.
3. SATSA warrants that the Regulations in Appendix A are operative at the inception of the Guarantee and shall remain operative during the Period of the Guarantee.

VARIATION
1. The Guarantee shall not be varied except by mutual consent of the parties.
2. Any variation shall be confirmed in writing.
3. SATSA shall not assign any rights under the Guarantee except with the prior written consent of LOMBARD.

APPLICABLE LAW
This Guarantee shall be governed in all respects by South African law and shall be subject only to the jurisdiction of South African courts.

SERVICE OF NOTICES
1. The chosen address of SATSA is stated in the Schedule.
2. SATSA shall notify LOMBARD of any change of its chosen address by in writing within seven days of the change.

COMPLAINTS PROCEDURE
1. It is always the intention to provide a first class standard of service
2. Should you have any cause for complaint you should, in the first instance, contact the intermediary who arranged this Guarantee for you.
3. If the matter is not resolved to your satisfaction, please write to the Managing Director of LOMBARD Insurance Company Limited at P. O. Box 2740, Parklands, 2121
4. If the matter is not resolved to your satisfaction, you can approach the Ombudsman for Short-Term Insurance at P.O. Box 35655, Menlo Park, 0102 for assistance.
5. This procedure does not affect your rights at law

___________________________________________

SCHEDULE TO THE FINANCIAL GUARANTEE FOR SOUTHERN AFRICA TOURISM SERVICES ASSOCIATION

The Guarantee is provided to: Southern Africa Tourism Services Association

Address: Petrob House, 343 Surrey Avenue, Ferndale, Randburg, 2194

Commencement Date: 1st March 2007
Minimum or Deposit Premium: R 320 000 (ex VAT) per annum payable on commencement
Premium: R 400.00 per member (entire membership) pro rata for period of membership for new members
Adjustment Premium: Within 30 days of end of period of cover, being premium received for new members in excess of minimum of deposit premium
Maximum Indemnity: R 1 500 000.00
Maximum Indemnity Per Event: R 300 000.00
Maximum Indemnity Per Member: R 75 000.00
No Claims Bonus: If no claims have been experienced during the period of cover, and SATSA provides written evidence to that effect and releases Lombard from any future liability relating to that period, an amount of 45% of the premium paid will be due to SATSA.

DECLARATION

SATSA declares that at the time of signing the Guarantee, it has:
1. Acted in the utmost good faith.
2. Strictly applied the Terms of Membership stated in Appendix A.
3. No reason to believe that any of its members are in financial difficulties.

Signed for and on behalf of
SOUTHERN AFRICA TOURISM SERVICES ASSOCIATION

Signed for and on behalf of
LOMBARD INSURANCE COMPANY LIMITED

Address: Ground Floor, Broll Place, Sunnyside Office Park
2 Carse O’Gowrie Road, Parktown, 2193
SOUTH AFRICA

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