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Lonmin - Signing of New Era Labour Agreement Lonmin Plc (Incorporated in England) (Registered in the Republic of South Africa under registration number 1969/000015/10) ISIN code: GB0031192486 Share code: LON Issuer code: LOLMI (`Lonmin`) Signing of New Era Labour Agreement Lonmin Plc, the National Union of Mineworkers (`NUM`), Solidarity and UASA announce that they have agreed and signed a New Era Labour Agreement (the `agreement`). This innovative agreement represents a new era in labour relations at Lonmin and has been drawn up and finalised by the joint union management problem solving forum (JUMPS), a committee made up of representatives from Lonmin management and NUM, Solidarity and UASA. The agreement is effective from 1 October 2005 for a 5-year term and covers all employees at Lonmin`s mining operations at Marikana, South Africa. The agreement is a living agreement and the parties have committed to continuous problem solving through the JUMPS structure. Under the terms of the agreement basic pay will be increased annually by a percentage equal to the South African CPIX inflation measure. Employees will have the opportunity to earn bonuses over and above CPIX by sharing in the improvements they achieve in costs and productivity under a gain sharing scheme, called Platinum Plus. The terms of the gain share will allow employees to share on an equal basis in an annual bonus pool equivalent to 25% of improvements in costs and productivity over an agreed base value. The agreement equalises the pay and conditions of employees across the Lonmin property and eliminates the historical differences that existed between each of Lonmin`s three mines. Lonmin employees will be invited to participate in shaping the future of the Lonmin business though the continued existence of JUMPS and will be encouraged to share their ideas for the continuous improvement of the operations. These ideas will be evaluated and implemented using Lonmin`s existing Six Sigma programme. The wage agreement with employees at Lonmin`s Western Platinum Refinery ends in September 2006 and will be re-negotiated at that time. Commenting on the new agreement, Brad Mills, Chief Executive Officer said: `The New Era Labour Agreement marks a new chapter in labour relations in South Africa. For the first time labour and management are working together to build a healthy business and have both given up their adversarial past. I want to thank the leadership of all of the unions for their bold vision and courage in joining us in this agreement which for the first time aligns the work force with the enterprise`s business case. Our Platinum Plus gain sharing programme represents a real opportunity for our workers to participate in the success of our improving business. The long term nature of the agreement and our commitment to continuous problem solving will ensure that the interests of management and the unions stay aligned over time.` Commenting on the new agreement, Victor Tseka, Lonmin Co-ordinator of NUM said: `The JUMPS process and New Era Labour Agreement has been a totally new challenge for NUM and Lonmin. Having completed the process we believe that this living agreement represents the best outcome for our members and a new opportunity to work together to benefit both Lonmin and its employees. We believe this represents the new era for the mining industry, South Africa and Africa` Commenting on the new agreement, Gerhard Viljoen, Co-ordinator, Solidarity said: `It took courage from all of Lonmin`s employees to enter into this agreement taking into consideration our past history in the mining industry. This definitely marks a new chapter for labour relations in South Africa and could provide a blue print for other mining companies currently involved in negotiations. ` Commenting on the new agreement, Hannes Scholtz, UASA Co-ordinator said: `UASA found the negotiation and completion of the New Era Labour Agreement a challenging event. It is from now on that every Lonmin employee will have to prove we are each willing and able to make the process workable. In making the agreement workable it can only create a harmonious workforce.` Enquiries: Alex Shorland-Ball, Vice President, Investor Relations & Communications, Lonmin plc Tel: +44 (0)7917 038 684 or +27 (0)14 571 2032 (22 June only) Nadja Vetter and Anthony Cardew, Cardew Group Tel: +44 (0)20 7930 0777 Date: 22/06/2005 09:30:35 AM Produced by the JSE SENS Department
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