zccm-ih egm circular to shareholders egm 24 02 2014.pdf

8/13/2019 ZCCM-IH EGM Circular to shareholders EGM 24 02 2014.pdf

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SalientDtes ndTimesThedefinitions nd nterpretationsommencing n page5 of thiscircular pplymutatismutandiso thissection.

Record ate n order o receivehisCircular nd he Noticeof the EG MCircular osted o shareholders n or beforeLast ate o trade n order o be eligibleo voteat the EGMLastday o lodge ormsof proxy n respectof the EGM by 10h00EGM o be heldat 10h00at Southern unRidgeway otel,Lusaka, ambiaPublication f the results f the EGMNotes:1. All imes referred o in this circularare local imes n Zambia.2. The abovedatesand imes aresubject o amendment.Any materialvariationofthe abovedatesand imes will be published n the localpress.3. To be valid, he completedFormsof Proxymust be lodgedwith the CompanySecretary t 1stFloor,MukubapensionHouse,DedanKimathiRoad, Lusaka,no later than 48 hours before the ExtraordinaryGeneral Meeting that is to be held at 10h00on Monda 24 February 2OL4aT

SouthernSunRidgewayHotel,corner ChurchRoadand Independence venue n Lusaka, ambia.Querieslf you have any questions n any aspects f this Circularpleasecontactyour stockbroker, ccountant, anker, egalpractitioner r other professionaldvisor, r the Financial dvisoror Sponsoring roker, maraor Stockbrokersambiarespectively t the contactdetailsbelow:lmara BotswanaLimited2nd Floor,MorojaHouse,Unit 6Building , Plot54365CB DP Bag00186Gaborone,BotswanaTel: +27 L 5506000Email: [email protected]

2014Friday, 4 JanuaryFriday, 1 January

Tuesday, 8 FebruaryFriday, 1 February

Monday, 4 FebruaryFriday,28 February

Stockbrokers ambia imited2nd Floor,StockExchangeuildingCentralParkP.O.Box38956Lusaka, ambiaTef: +26O2L]-232456Email: [email protected]

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3. Purposeof this CircularThepurpose f this Circulars o provideZCCM-IH hareholders ith the requisitenformation,o enableShareholdersomakean informeddecision n respect f the EGMand the attendantResolutionshat are required o be approvedan dpassed y the Shareholdersn order o permit the Company,hrough he Directors nd Management,o implement heRightsOffer.4. The proposedRightsOffer and Recapitalisation f ZCCM-IH4.1. lntroductionIn order o implement he ZCCM-IH trategic lanand achievets critical bjectives,he Boardhas ecommendedhat theCompany houldundertake renounceable ightsOffer o all Shareholders.A "rightsoffer" isan offer made o exi sting hareholders f a company o subscribeor new shareson a pro rata basis.It isproposedhat thisZCCM-IHights fferbe conducted n a "claw-back" asis.Rights ffersare a common mechanismor raising largequantumof capital elative o existingmarketcapitalization,particularly hereshareholderso not wish o be diluted.4.2. The ZCCM{HClaw-backRightsOffer n summaryIt isenvisagedhat the proposedRightsOfferwill enableZCCM-IHaiseup to a maximumof ZMW 2.5 bill ion.Thereforenorder o undertake rights ffer of this magnitudehe following mplementation tepsand actionswill be required nd arenecessary:-

i. Increase f the authorised hare apital f the Company;ii. lssuance f newOrdinary hareso r aise he targetamountof up o a maximum f ZMW 2.5 bill ion;ii i. The new OrdinaryShares ill be issued o existing har eholdersf ZCCM-lH ro-rata o their existing hareholdirgin the Company;iv. The RightsOffer will be underwr ittenand undertakenas a clawbackoffer;v. Theselected nderwriters il l underwrite he RightsOfferon a claw-back asis; ndvi. Once he Resolutions re approvedby the Shareholderst the EGMon Monday,24 February 0 4, a detailedRenounceableightsOfferCircular il l be prepared ettingout detailed ermsand conditions f the ZCCM-IH law-backRightsOffer subscription rice,entitlement atio,offer dates, radingof rights,etc.)and posted o all eligibleexisting hareholderst the recorddate.

4.3. Shareholding tructure and statuson the stockexchangeAs set out in Table1 below, he GRZ urrently olds87.5% shareholdingn ZCCM-lHmadeup of 6O.3o/oesignated s "A "Shares nd273%designated s 8" Shares. he balance f the shareholdingf 12.4%is esignated s"B" Shares nd heseare heldby the public.The 12.4% B" Shares eld by the publicand he 27.3yo8" Shares eld by GRZwere istedon theLuSEn 1995. he A" Shares eldby GRZ re currently ot l istedon anystockexchange.Table1: ZCCM-lH hareholdingtructure

4.4. RationaleforRecapitalisationTheproposedRightsOfferhasa numberof crit ical nd mportantobjectiveshat nclude he following:o Strengtheninghe Company's alance heet n the long erm by issuance f new OrdinaryShareso Shareholdersy

way of conducting renounceablelawback ights ffer o raise p to a maximum f ZMW 2.5bill ion;r lnject additional resh equity capital nto ZCCM-I H hich the Companycan util ize or strategic nvestments nddevelopments;ndo Avoid nvoluntary ilutionof anyclass f shareholders.

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ln accordance ith the Articles f Association,he authorised nd unissuedOrdinaryShares re under he controlof theDirectors r asdirected ndauthorised y he Shareholdersubject o the provisions f the Companies ct .Any variationof rights attaching o OrdinaryShares equires he consentof Shareholders y special esolution naccordance ith the Articles f Associationf ZCCM-lH.7. Resolutionsor approvalat the EGMAt the EGM o be held on Monday,24 February 014 notice or the meeting s contained t Annexure - f this Circular),Shareholdersre required o vote on the Resolutionsertainingo the Recapitalisation,he consequentialmendments fthe Articles s well as he util isation f the Euroclear PIServiceor recognition f beneficial hareholdersradingunderEuronext/Pais Bou se.8. Directors'Responsibil ityStatementThe Directors, hosenamesaregivenunderCorporatenformationon page2 of this Circular ollectively nd ndividuallyaccept ull responsibil ityor the accuracy f the information ivenand certify hat to the bestof their knowledge nd beliefthere are no other facts he omission f which would make any statement alseor misleading,hat they havemadeal lreasonable nquirieso ascertain uch acts whereapplicable),nd hat this Circular ontains ll he information equiredto enableShareholderso make an informeddecision n respectof the EGMand the attendantResolutionshat arerequired o be approvedand passed y the Shareholdersn order to permit the Company,hrough he Directors ndManagement,o implement he RiShts ffer.9. Documentsavailable or inspectionThe ollowingdocuments, r copies hereof,wil l be availableor inspection uringnormalbusiness oursbetweenFriday,31 January2OL4andMonday, 24 February2OL4 rom the registeredoffice of the Company, he officesof the TransferSecretary nd the off icesof the Sponsoring roker, he addresses f which are set out in the "Corporate nformation"section n page2 of thisCircular:9.1. TheArticles f Associationf ZCCM-lH;9.2. The auditedconsolidatedinancial tatements f ZCCM-lHor the financial earsended31 March 2O t,2012 an d2QT3:9.3. The orm of the Resolutionsf Shareholderso be presented t the EGM;an d9.4. ThisCircularo Shareholdersated24 January Ot4.

Datedat Lusakahis 24thday ofJanuary2Ot4

On Behalfof the Boardof ZCCM-IH tC

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Annexure : Noticeof Extra-Ordinary eneralMeeting

ZCCM NVESTMENTSOLDINGSLC(lncorporatedn he Republic f ZambiaCompanyRegistration umber: 71)ShareCode: CCM-IH

lSlN:2M0000000037( ZCCM-|H r the Company )Directors

W D Mung'omba (ExecutiveChairman),P C Kabamba,S K M Mutemba,C K Mwananshiku, B E K Ngandu,J M D Patterson

Address: 1st Floor, Mukuba PensionHouse,Dedan Kimathi Road,LusakaNOTICE FEXTRAORDINARYENERAL EETINGNotice s herebygiven hat an Extraordinary eneralMeetingof Shareholdersf the Companywill be held at 10h00onMonday,24 February 014at SouthernSun Ridgeway otel,cornerChurchRoadand Independence venue n Lusaka,Zambia the EGM ), or the purposes f considering nd, f deemed it, passing, ith or without modification,he specialandordinary esolutionsubstantiallyn the form setout below n the manner equired y he Companies ct .A. SPECIAL ESOLUTIONSPercentage fvoting rights required o passspecial esolutions s 75%ofthe voting ri ghts exercised.a) SPECIAI ESOTUTIONa) - Increase f AuthorisedShareCapitalTHAT he authorised harecapitalof the Company, omprising 0,000,000 rdinary hares f ZMW 0.01par valueeach,madeup of 54,000,000A Ordinary hares f ZMW 0.01parvalueeachand 36,000,000B Ordinary hares f ZMW 0.01parvalueeach be ncreasedo 200,000,000 rdinary hares f ZMW0.01 ar valueeachby creating 10,000,000 rdinaryshares f ZMW0.01 ar valueeachmadeup of 56,000,000A Ordinary hares f ZMW 0.01parvalueand44,000,0008Ordinary hares f ZMW0.01 ar valueeach for purposes f implementinghe Transaction;Motivation for special esolution(a )The reason or s pecial esolution a) s to increasehe numberof OrdinarySharesn the authorised harecapitalof theCompany n or der o createsufficient uthorisedOrdinarySharesn the authorised harecapitalof the Companyor thepurpose f implementinghe proposed ransaction nd any other uture ssues f shares hat may be undertaken y th eCompany.b) SPECIAI ESOTUTIONb) - Amendments o wording on sharecapital n the Articlesof AssociationTHATsubject o the approvalof special esolution a) above,Article 3 (A) of the Articlesof Association f the Companybeamended y the replacement f the numbers nd words K 900,000,000ivided nto 54,000,000A OrdinaryShares f K10 each and 36,000,000 8 Ordinary Sharesof K 10 each with the number and words ZMW 2,000,000divided into120,000,000A Ordinary hares f ZMW 0.01eachand 80,000,0008 Ordinary hares f ZMW 0.01each ;c) SPECIAI ESOTUTIONc) Amendments o wording on sharecapital n the Articlesof AssociationTHATsubject o the approvalof special esolution a) and (b) above,Article3 (B) of the Articlesof Association f th eCompanybe amendedby the replacement f the numbersand words A Ordinory Shdres f K 70 each and 8 OrdindrySharesof K 70.00 each with the number and words A Ordinary shares of ZMW 0.07 each dnd 8 Ordindry SharesofZMW 0.07 each;Motivation for special esolutions b) and (c)The reason or special esolutions b) and (c) is to obtain approval rom the Shareholders f the Com pany or theamendment o the Articles f Associationf the Companyo giveeffect o the changen authorised hare apital ecordedin special esolutiona)aboveand n inewith the rebased ambian wacha.

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d) SPECIAL ESOTUTIONd) - Amendments to the Articles of Association o a llow for identificationof beneficialshareholders ndernomineearrangements

THAT he Company's rticles f Association e amended o authorise he Company o utilizeany beneficial hareholderidentification ervices hichmay be availableo it under he rulesand procedures f any StockExchanger Central haresDepository,n Zambiaor outsideof Zambia,holdingany of the Company'sssuedsharesas nominee,and that suchamendment e and s herebyapproved s hiswill provide he Companywith a directchannel of communication ith al lshareholders ho are undersuchnominee rrangementsor purposes f corporate ctionsncludinghe RightsOffer.Motivation for special esolution d)The eason or specialesolution c) s o obtainapproval rom the Shareholdersf the Companyor the amendmento theArticles f Associationf the Companyo provide or the useof beneficial hareholderdentificationervices. hiswill allowfor the Companyo be able o useEuroclear'sPIServiceor directcontactof thoseShareholdershoseshares re radedon Euronext/Parisoursen France nd heldunderEuroclear.e) SPECIALESOLUTIONe)- increasing orrowingpowersof the DirectorsTHATArticle96 of the Articles f Association f the Company e amendedby the replacement f the number USS 00mil l ionwith he number ndwordsKwacha quivalent f USS bi l l ion.Motivation for special esolution e)The easonor specialesolution d) s o obtainapprovalrom the Shareholdersf the Companyor the amendmento theArticles f Associationf the Companyo increasehe borrowing owers f the Directors.B ORDINARY ESOLUTIONS:Percentage f voting rightsrequired o passordinary resolutions s 50%plusone vote of the voting rights exercised.a) ORDINARYesolutiona):Allocation f Renounceable ights o Share holdersn Pro-rataTHAT he Board be and is herebyauthorised o allocate o the sharehold ers f the Companyon a pro rata basis,renounceableights o subscribeor ordinary hares f the Company ursuanto the RightsOffer;b) ORDINARY esolution b): ssuance f new ordinarysharesunder the RightsOfferTHAT he Boardbe and s herebyauthorisedo issue nd allot suchnumberof new OrdinarySharesn the authorised utunissued harecapitalof the Company or purposes f implementing he renounceable law-backRightsOffer. Suchauthoritywill include he author.ityo issueand allot such numberof new shares n the authorised ut unissued harecapital f the Companyo anyunderwriter(s) f suchRightsOffer;c) ORDINARY esolution c):Registration f the incrementalAuthorisedShareswith the SECTHAT he Boardbe and s herebyauthorisedo registerhe additional uthorised hares ith the Securities nd ExchangeCommission f Zambiaand submitan applicationor the listingof the total issued harecapitalof the Company n theLusaka tockExchangethe LuSE );d) ORDNARY esolution d): Dematerialisation f the ShareRegisterTHAT he Boardbe and s herebyauthorisedo takeall necessaryctions o ensure hat the Company's ainshare egisteris dematerializeduch hat all of the Company's hares, urrently eld n physical ertificateormat,are depositednto heCentral hares epository fthe LuSEor custody ndon-going ecordkeeping;e) ORDINARY esolution e):Authorisationof the Board o conduct he RightsOffer and the TransactionTHATtheBoardbe and s herebyauthorisedo performsuchactsand do all hings ncidentalo the implementation f theRightsOfferand he Transaction;ndf) ORDINARY esolution f): Approval of all actionsby the Board o facilitate he RightsOffer and the TransactionTHATwe the membersof the Company pprove, onfirmand ratify n all respects ll actions, xecutions nd deliveriesheretoforeakenor madeby he Boardor suchauthorised erson n the nameor on behalfof the Companyn connectionwith the carrying ut of the RightsOfferand he Transaction.C) ORDINARY esolution g):Appointment of a DirectorAt the AnnualGeneralMeeting held on 30 December2013,Shareholdersesolved hat a resolution o consider heappointment f a non-executiveiiectoron the Board f the Companyo representminorityShareholderse abledat thenextgeneralmeeting f members f the Company.THATwe the members f the Company pprove,hat a person e appointedo representhe minority hareholdersn th eZCCM-IH oardand hat the Directors reherebyauthorisedo undertake llactions ecessaryn the nameor on behalfof

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Annexure : Formof Proxyl^vE......-................. .......'.'..........(Pleases lock apitals)of............................. Being (a) member (s) of ZCCM nvestmentsHoldingslc, reby PPoint*Mr WilaD. Mung'omba f MukubaPension ouse, 309DedanKimathiRoad,P O Box30O48, uska 01-01,ambia rfailing im, uch therperson smaybe appointed hairmanf themeeting r Mr/Mrs/Ms/Dr 'u, ry/ou, proxy o vote or me/uson my/ourbehalfat the EGMof the Companyo be hldat 10h00on Monday,24Februarv014at Southern unRidgewayotet, ornerChurchRod nd ndependencevenuen Lusaka,ambia.

(tf execltedby a corporation,his orm shouldbe givenunder ts commonsealorgigned n ts behalfby anattorneyor officerof the corporation uly authorisd)'This Form of proxy should be submitted so as to reach the Companynot less hn 48 hours before time of holding themeeting.Notice of revocationof this Form of Proxy must be receivedby the Companyat its registeredoffice at least onehour before he time appointed or the meeting.please ndicatewith an X, in the spacesblow, how you wish your vote to be cast. f no such ndication s given, he proxywillvote or abstain t his/herdiscretionDetailsof ResolutionSpecialesolution a) :lncrease f Authorised hareCapitalSpecialesolution b) :Amendmentso the wording n Article {A} n he Articles f AssociationSpecialesolut ionc):Amendmentso the wording n 3 (B) n he Articles f AssociationSpecialesolution d) :Amendmento the Articles f Associationo allow or identification f beneficialshareholderndernomineestructureSpecialesolution e) :lncreasing orrowingpowersof the DirectorsOrdinary esolution a)Authorisationo allocate enounceableights o ShareholdersOrdinaryesolut ionb):Authorisationo issue ew Ordinary hares nder he RightsOfferOrdinarYesolution c) :Authorisationo registerhe authorised hare apital f the Company ith the SEC ndlisting f total ssued hare apital n the LUSE'Ordinaryesolut iond):Authorisationo dematerialisehe ShareRegisterOrdinary esolution e) :Authorisationo the Board o implement he RightsOfferand he TransactionOrdinary esolution f):Approval f actions y he Board o facilitatehe RightsOfferand heTransactionOrdinary esolution g)Authorisationo appointa director o representminority hareholders

ik o, t thenamepr intedhereandinsertnameofproxydesired'

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Annexure : Formof ProxYof ZCCM Investments

Lusaka 0101., ambia r

oatedhid9F.lloayot...fh0i.S.zor4 signature(tfexecutedyacorporetion,his orrn hould eSivenndrtscomrnoneal rsignedn tsbehlt yanattomeyrofficer f hcorporationuvauthorised)'This Form of proxy should be submitted so as to reachthe Companynot less han 48 hours before time of holding themeeting.Noticeof revocationof this Formof Proxymust be receivedby the Companyat its registeredoffice at least onehour before he time appointed or the meeting.please ndicatewith an X, in the spacesbelow, how you wish your vote to be cast. f no such ndication s givn. he proxywillvote or abstain t his/herdiscretion

Specialesolution a}:lncrease f Authorised hareCapitalSpecialesolution b} :Amendmentso the wording n Article (A) n the Articles f AssociationSpecialesolution c) :Amendmentso the wording n 3 (B) n the Articles f AssociationSpecialesolution d) :Amendmento the Articles f Associationo allow or identificatio n f beneficialshareholder ndernominees tructureSpecialesolution e) :Increasing orrowingpowersof the DlrectorsOrdinary esolution a) :Authorisationo allocate enounceableights o ShareholdersOrdinaryesolut ionb):Authorisationo issue ew Ordinary hares nder he RightsOfferOrdinary esolution c):Authorisationo registerhe authorised hare apital f the Company ith the SEC ndlisting f total ssued hare apital n the LuSE'Ordinary esolution d)Authorisationo dematerialisehe ShareRegisterOrdinary esolution e} :Authorisationo the Board o implement he RightsOfferand he TransactionOrdinary esolution f):Approvalof actionsby the Board o facilitate he Rights ffer and he TransactionOrdinary esolution g) :Authorisationo appointa director o representminority hareholdersutthenamepr intedhereandinsertnameofproxydesired.

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Annexure : Formof ProxYl/W8........................ '(Pleasese lock apitls)of............................. . '. .... Being {a) member (s) of ZCCM nvestmentsHoldingslc, erebYPPoint*Mr WilaD.Mung,ombf Mukuba ension ouse, 309Dedan imathi oad, O Box30048, usaka0101, ambia rfailing im,such therperson smaybeappointedhairman f the meeting r Mr/Mrs/Ms/Dr. , ,i/o* proxy o vote for me/usn my/ou,behalfat the EGMof the Companyo be heldat 10h00on Mondav,24February014 t SouthernunRidgewayotel, orner hurchRoad nd ndependencevenuen Lusaka,ambia'

Dtedhis...........Dayf... '. '.. '... '....-2014 signature 'itf executed ya corporation,his orm shouldbe givenundr ts common eelo. siSned n its behalfby an attorneyor offlcerof the corporation ulYaLrthorised)This Form of Proxy should be submitted so as to reach the Compnynot less han 48 hours before time of holding the ting. t,'loti. of revocationof this Formof Proxymust be receivedby the Companyat its registeredoffice at least onehourbefore he time appointedor the meeting'please ndicatewith an X, in the spacesbelow, how you wish your vote to be cast. f no such ndication s given, he proxywill voteor bstain t his/herdiscretion.Detailsof Resolution For Against AbstainSpecia lesolut iona) :lncrease f Authorised hareCapital xAmendmentsCI he wording n Art icle3 {A) n he Art icles f Associat ion XSpecia lesolut ionc):Amenclmentso the wordine n 3 (B) n the Art icles f Associat ion XSpecialesolution d) :Amendmento the Art icles f Associationo allow or identification f beneficialcharpholder ndernominees tructure xSpecialesolution e) :tnr^roecinsorrowinsoowersof the Directors XOrdinary esolution a) :Authorisationo allocate enounceableights o Shareholders XOrdinaryesolut ionb):ar fhorisationo issue ewOrdinarV hares nder he RightsOffer XOrdinaryesolut ionc) :Authorisationo registerhe authorised hare apital f the Company ith the SEC ndlicrinp f total ssued hare apital n the LUSE.

XOrdinary esolution d) :arrthnricationo dematerialisehe ShareRegister xOrdinary esolution e):rrrhorisationo the Board o implementhe RightsOfferand he Transaction xOrdinary esolution f)annroval f actions v he Board o facilitatehe Rights ffer and he Transaction XOrdinary esolution g)Authorisationo appointa director o representminorityshareholders X*Note: nam pr intedhereandinser tnameofproxydesired.

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