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ARROWHEAD PROPERTIES LIMITED - Posting of circullar

Release Date: 26/03/2013 16:00
Code(s): AWA AWB     PDF:  
Wrap Text
Posting of circullar

ARROWHEAD PROPERTIES LIMITED
(formerly Nervada Trading 13 (Proprietary) Limited)
(Registration number 2011/000308/06)
JSE code: AWA ISIN: ZAE000158101
JSE code: AWB ISIN: ZAE000158119
(“Arrowhead”)

POSTING OF CIRCULAR

Introduction

Linked unitholders are advised that Arrowhead has posted a circular dated 26 March 2013 (the “circular”) to linked
unitholders in respect of:

-        the issue of 9 million Arrowhead “A” linked units and 9 million Arrowhead “B” linked units to the Arrowhead
         Charitable Trust in terms of a specific issue of shares for cash (the “specific issue”);
-        the granting by Arrowhead of a loan to the Arrowhead Charitable Trust to fund the subscription of such
         Arrowhead linked units; and
-        amendments to the Arrowhead Unit Purchase Trust deed to:
         -      increase the total scheme allocation, being the number of Arrowhead units which may be utilised for the
                purposes of the scheme constituted by the Arrowhead Unit Purchase Trust; and
         -      increase the fixed maximum number of scheme units to which any one participant may be entitled under
                the scheme constituted by the Arrowhead Unit Purchase Trust.

Copies of the circular will be available for inspection during normal business hours at the offices of Arrowhead, 2nd
Floor, 18 Melrose Boulevard, Melrose Arch, Johannesburg, 2196, from 26 March 2013 to 22 April 2013.

The circular is also available in electronic format at www.arrowheadproperties.co.za.

Terms defined in the circular shall bear the same meaning in this announcement.

Notice of general meeting

Included in the circular posted today, Tuesday, 26 March 2013, is a notice of general meeting of Arrowhead
shareholders and debenture holders, which general meeting is to be held at the offices of Arrowhead, 2 nd Floor, 18
Melrose Boulevard, Melrose Arch, Johannesburg, 2196 on Wednesday, 24 April 2013 at 10:00 to consider and, if
deemed fit, to pass, with or without modification, the resolutions necessary to effect, inter alia, the specific issue and
the proposed amendments to the Arrowhead Unit Purchase Trust deed.

Salient dates and times

The salient dates and times for the general meeting and the specific issue are as set out below. All times indicated
below are local times in South Africa. The dates and times indicated in the tables below are subject to change. Any
such changes will be released on SENS and, if required, published in the press.

                                                                                                                 2013
    Record date for receipt of notice purposes                                                       Friday, 15 March
    Circular posted on                                                                              Tuesday, 26 March
    Last day to trade in order to be eligible to vote at the general meeting                         Friday, 12 April
    Record date in order to be eligible to vote at the general meeting                               Friday, 19 April
    Last day to lodge forms of proxy in respect of the general meeting                               Monday, 22 April
    General meeting at 10:00 on                                                                   Wednesday, 24 April
    Results of the general meeting published on SENS n                                            Wednesday, 24 April
    Results of the general meeting publshed in the press on                                        Thursday, 25 April
    Subscription units issued to the Arrowhead Charitable Trust on                                   Monday, 29 April
The Arrowhead Charitable Trust

The object of the Arrowhead Charitable Trust is to make charitable donations and distributions to its beneficiaries
being:

-     underprivileged communities or individuals in cities, towns and areas where Arrowhead is invested;
-     projects designed to benefit the aforesaid communities or individuals; and/or
-     charitable organisations benefitting the aforesaid communities or individuals.

The Arrowhead Charitable Trust will generate its capital from the profit on the sale of the subscription units. Once the
trust loan has been repaid, the income generated from the trust capital will be used to make donations and distributions
to its beneficiaries.

Based on an assumed 20% increase in the price at which Arrowhead linked units trade over the period of the trust
loan, which assumption is merely illustrative and does not constitute any form of a projection or forecast or estimate,
the Arrowhead Charitable Trust will generate approximately R21,6 million in trust capital from which it could
generate in the region of R2,05 million a year in income available for charitable distributions.

While Arrowhead will have the right to appoint a trustee to the Arrowhead Charitable Trust, the Arrowhead Charitable
Trust will operate independently of Arrowhead and will have a majority of independent trustees.

The specific issue

Subject to fulfilment of the conditions precedent set out below, Arrowhead will issue the subscription units to the
Arrowhead Charitable Trust at the subscription price of R7.57 per A linked unit and R7.32 per B linked unit, being the
respective volume weighted average price at which Arrowhead A linked units and Arrowhead B linked units traded
for the 30 trading days preceding the last practicable date of the circular.

The issue of the subscription units will increase Arrowhead’s units in issue by 4.56% but these units will be accounted
for as treasury units until such time as they are sold by the trust or the trust loan repaid, whichever is the earliest.

The total subscription price payable for the subscription units will be financed by a loan from Arrowhead. The trust
loan, which will be secured by a pledge and cession in securitatem debiti of the subscription units (although
Arrowhead’s right to repurchase the subscription units in terms of the pledge and cession in securitatem debiti will be
subject to any necessary unitholder approval at that time), will be repayable out of the proceeds of the sale by the
Arrowhead Charitable Trust of the subscription units. The interest on the trust loan will be equivalent to the interest
distributions received on the subscription units. The trust loan shall be repayable in full on the earlier of:

-     the fifth anniversary of the subscription date; and
-     the date on which the Arrowhead Charitable Trust and Arrowhead agree in writing that the trust loan will be
      repaid.

The specific issue remains subject to the following conditions precedent, namely:

-     Arrowhead shareholders passing all resolutions required to approve the specific issue of the subscription units
      to the Arrowhead Charitable Trust for the subscription price payable in cash including the placement of 9
      million A linked units and 9 million B linked units of the authorised but unissued share capital of Arrowhead
      under the control of the Board for that purpose; and
-     Arrowhead shareholders passing all resolutions required to authorise the board of directors of Arrowhead to
      grant financial assistance to the Arrowhead Charitable Trust by way of the trust loan as is envisaged in section
      44 of the Companies Act.

Pro forma financial effects

Given that the interest received by Arrowhead on the trust loan will be equivalent to the distributions payable on the
subscription units, the issue of the subscription units will have no effect on distributions per unit until such time as the
subscription units are sold by the Arrowhead Charitable Trust.
Until such time as the trust loan is repaid, Arrowhead will consolidate the Arrowhead Charitable Trust. As a result of
this consolidation neither the subscription units nor the trust loan will be reflected in Arrowhead’s consolidated
financial statements and accordingly the transaction will have no effect on the pro forma historical earnings, headline
earnings or asset value per unit. Therefore no pro forma financial information has been provided.


26 March 2013


Corporate advisor, legal advisor and sponsor

Java Capital

Date: 26/03/2013 04:00:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE'). 
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