Proforma undertaking letter from remaining shareholders of acquiree company under Practice Note 2.9.6

Transcription

1 1 Appendix I Proforma undertaking letter from remaining shareholders of acquiree company under Practice Note [Name of remaining shareholder of acquiree] [Company registration number/ic number] [Address] Date [Name of acquirer] [Company registration number/ic number] [Address] Dear Sirs, [Name of acquiree company] - Letter of Undertaking Pursuant to an Exemption under Practice Note of the Malaysian Code on Take-overs and Mergers 1998 (Code) [Detailed background of proposed transaction leading to the mandatory offer obligation, including, but not limited to, the following: - Background information on acquirer and remaining shareholder, including name and number of shares held in acquiree; - Details of transaction, i.e. whether acquisition is through sale and purchase agreement (S&P) or market purchase. If through S&P, to include principal terms other than those outlined below (in particular the main warranties and indemnities to be sought from the shareholders and whether such warranties and indemnities differ between shareholders); - Purchase consideration, form of consideration (cash/share exchange/convertibles) and consideration per share; - Confirmation on any special arrangements between the acquirer and any shareholders other than the proposed consideration set out above (negative statement if none); - Potential offer price per share to be offered by acquirer, if such mandatory offer is to be undertaken in accordance with the relevant provisions of the Code; - Rationale for the transaction; and - Resultant shareholding of acquirer in acquiree after completion of proposed transaction.]

2 2 2. Code implications pursuant to the transaction and the seeking of exemption under PN2.9.6 wherein the exemption would only be granted upon fulfillment of certain specified criteria under the said practice note, which include, inter-alia, the submission of an undertaking from remaining shareholder that it would not accept a takeover offer if such an offer is extended by the acquirer. 3. Undertaking by remaining shareholder that, after giving due consideration to the legal and financial implications of the transaction, including the mandatory offer implications thereof, not to accept any take-over offer at the potential offer price of [RM] per share, if such an offer is extended by the acquirer to acquire the shares in the acquiree held by the remaining shareholder. Yours sincerely [Signature] [Name of the remaining shareholder. If the remaining shareholder is a corporation, name and designation of person authorized to issue undertaking letter on behalf of the company]

3 3 Appendix II Example of the proforma undertaking letter from remaining shareholders of Acquiree company under Practice Note ABC Sdn Bhd ( A) 2, Blok F Jalan Kenari Kuala Lumpur 30 April 2002 The Board of Directors Acquirer Berhad ( B) 30, Jalan Enggang Ipoh Perak Dear Sirs, Acquiree Sdn Bhd - Letter of Undertaking Pursuant to an Exemption under Practice Note (PN) of the Malaysian Code on Take-overs and Mergers 1998 (Code) 1. BACKGROUND INFORMATION 1.1 Information on Acquirer Berhad and ABC Sdn Bhd (ABC) We refer to the above matter and to the proposed acquisition by Acquirer Berhad of 4,000,000 ordinary shares of RM1.00 each, representing 50% equity interest in Acquiree Sdn Bhd, for a purchase consideration of RM40,000,000 from XYZ Sdn Bhd (Proposed Acquisition). We, ABC, are the holders of the remaining 2,000,000 ordinary shares of RM1.00 each or 25% equity interest in Acquiree Sdn Bhd.

4 4 1.2 Details of the Proposed Acquisition We understand that Acquirer Berhad and XYZ Sdn Bhd had entered into a sale and purchase agreement (S&P) on 20 November 2001 in relation to the Proposed Acquisition. (To state main warranties and indemnities in the S&P to be sought from shareholders of Acquiree Berhad, if any) We understand that the purchase consideration of RM40,000,000 is to be wholly satisfied by an issue of 8,000,000 new Acquirer Berhad shares of RM1.00 each at an issue price of RM5.00 per share. Other than the said consideration stated, we have been advised that there are no other special arrangements between Acquirer Berhad and XYZ Sdn Bhd in relation to the Proposed Acquisition. We understand that the rationale of the Proposed Acquisition is to allow Acquirer Berhad to participate in the proposed corporate restructuring of CDE Industries Berhad. Upon completion of the Proposed Acquisition, Acquirer Berhad would increase its holding in Acquiree Sdn Bhd from 25% to 75%. 2. IMPLICATIONS OF THE CODE ON THE PROPOSED ACQUISITION Acquiree Sdn Bhd is considered an acquiree company pursuant to PN 1.2 of the Code since the purchase consideration for the Proposed Acquisition is more than RM20.0 million, and Acquiree Sdn Bhd s shareholders funds stand at more than RM10.0 million. Upon completion of the Proposed Acquisition, Acquirer Berhad would be obliged under Part II of the Code and Section 33B(2) of the Securities Commission Act 1993 to extend a mandatory offer to acquire the remaining 2,000,000 ordinary shares of RM1.00 each in Acquiree Sdn Bhd not already held by it at a cash offer price of not less than RM5.00 per share, or one new Acquirer Berhad share of RM1.00 each at an issue price of RM5.00 per share for every one Acquiree Sdn Bhd share of RM1.00 each (Mandatory Offer).

5 5 3. UNDERTAKING FROM ABC We understand that Acquirer Berhad is seeking an exemption from having to extend a Mandatory Offer under PN of the Code from the Securities Commission (SC) (Proposed Exemption). This exemption would only be granted by the SC upon submission of a letter of undertaking by us not to accept the Mandatory Offer, if such an offer is extended by Acquirer Berhad. In view of the above, we, ABC Sdn Bhd, hereby CONFIRM and AGREE that after giving due consideration to the legal and financial implications of the Proposed Acquisition, including the Mandatory Offer implication thereof, we hereby undertake not to accept any take-over offer at the potential cash offer price of RM5.00 per share, or alternatively, one (1) new Acquirer Berhad share of RM1.00 each at an issue price of RM5.00 per share for every one (1) Acquiree Sdn Bhd share of RM1.00 each if such an offer is extended by Acquirer Berhad. Yours sincerely ABC Sdn Bhd [Signature] Name :.. Designation :..