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Revised Terms of Subscription Agreement Regarding a Specific Issue of Shares for Cash
NUTRITIONAL HOLDINGS LIMITED
(Incorporated in the Republic of South Africa)
(Registration Number 2004/002282/06)
Share code: NUT ISIN: ZAE000156485
(“the Company” or “NUT”)
REVISED TERMS OF SUBSCRIPTION AGREEMENT REGARDING A SPECIFIC
ISSUE OF SHARES FOR CASH TO A BLACK ECONOMIC EMPOWERMENT
(“BEE”) CONSORTIUM
1. Introduction and Rationale
1.1. Shareholders are referred to the announcement
released on SENS on 13 August 2014, wherein the
Company advised that it had concluded a
subscription agreement with Philisani, a black-
controlled entity led by Mr Thabo Mokgatlha (“BEE
consortium” or “Philisani”) in terms of which the
Company will issue 1 300 000 000 (one billion three
hundred million) new ordinary shares at an issue
price of R0.01 (one cent) per share to the BEE
Consortium for cash (“BEE Subscription”).
1.2. Shareholders are advised that the Company and
Philisani have revised the terms of the BEE
Subscription.
2. Specific Issue
2.1 The parties have agreed that, the Company will
issue, and the BEE Consortium will subscribe for,
1 000 000 000 (one billion) new ordinary shares in
the authorised but unissued share capital of the
Company (“Subscription Shares”) at an issue price
of R0.01 (one cent) per share (“Issue Price”), being
a 10% discount to the 30-day volume weighted average
trading price of NUT shares as at 13 October 2014
(being the date on which the Subscription Agreement
was concluded), and constituting a total purchase
consideration of R10 000 000 (ten million rand)
(“Specific Issue”).
2.2 In terms of the Specific Issue Mr Thabo Mokgatlha
will be appointed as Chief Executive Officer of the
Company. Mr Rob Etchells will remain as a director
of the Company as Chief Operating Officer.
2.3 The Company’s attorneys have confirmed that the BEE
Consortium have provided payment and/or security to
the satisfaction of the Board of Directors of NUT
for the payment of it’s obligations in terms of the
Specific Issue.
2.4 The Company is currently pursuing alternative
sources of equity funding to raise an additional
R3 000 000 (three million rand).
3. Consortium Members
3.1 The shareholders of the BEE Consortium comprise Mr
Thabo Mokgatlha (51%), Mr Rob Etchells, chief
executive officer of NUT (16.33%), Mr Rick Wilson
(16.33%) and Zustonelli Limited (16.34%).
3.2 Notwithstanding that Mr Etchells is a minority
shareholder in the BEE Consortium, the Specific
Issue will be deemed to be an issue to a related
party in terms of paragraph 10(2) of the Listings
Requirements of the JSE Limited (“JSE”) as Mr
Etchells has a vested interest in the Specific
Issue.
4. Conditions Precedent
The implementation of the Specific Issue will be subject to
the fulfilment of the following conditions precedent on or
before 31 December 2014:
4.1. the board of directors of the Company (“the Board”)
agreeing to call a general meeting of NUT
shareholders for purposes of approving, inter alia,
the Specific Issue; and
4.2. all regulatory approvals including, inter alia,
those required in terms of the JSE Listings
Requirements and the Companies Act having been
obtained.
To the extent that the conditions precedents are not
fulfilled or waived (as the case may be) on or before
31 December 2014, the BEE Subscription will not become
effective and the Specific Issue will not be made.
5. Pro forma financial effects
5.1. The pro forma financial effects set out below have
been prepared for purposes of assisting the
Company’s shareholders to assess the impact of the
Specific Issue on the earnings per share (“EPS”),
headline earnings per share (“HEPS”), net asset
value per share (“NAV”) and tangible net asset value
per share (“TNAV”).
5.2. It is assumed for purposes of the pro forma
financial effects that the Specific Issue took place
with effect from 1 March 2013 for purpose of the
statement of comprehensive income and at 28 February
2014 for purposes of the statement of financial
position.
5.3. The pro forma financial effects have been prepared
for illustrative purposes only and, because of their
nature, may not fairly present the Company’s
financial position, results of its operations,
changes in equity or cash flows.
5.4. The pro forma financial effects are the
responsibility of the Board and have not been
reviewed by the auditors of the Company.
Per Audited 28 Adjustments Pro forma %
Nutritional February for the after the Change
share 2014 Specific Specific
(cents) Issue Issue
EPS (loss) (0.32) 0.13 (0.19) 40.6%
HEPS (0.32) 0.14 (0.18) 43.8%
(loss)
NAV 1.55 (0.20) 1.35 (12.9%)
TNAV 0.90 0.02 0.92 2.2%
Number of 1 907 368 1 000 000 2 907 368 52.4%
shares in
issue
(‘000)
Weighted 1 907 368 1 000 000 2 907 368 52.4%
average
number of
shares in
issue
(‘000)
Notes:
a. The “Audited 28 February 2014” has been extracted, without
adjustment, from the audited financial statements of
Nutritional for the financial year ended 28 February 2014.
b. The “Pro forma after the Specific Issue” column is based on
the assumption that 1 000 000 000 NUT ordinary shares will
be issued to the BEE Consortium for a total consideration of
R10 million.
c. It was assumed that the Company’s gearing was reduced with
the proceeds of the Specific Issue. The interest expense
incurred for the year ending 28 February 2014, amounting to
R488 000 has been reversed in the pro forma’s. Interest
earned on the residual proceeds of the Specific Issue has
been provided at R188 000.
d. Once-off transaction costs of approximately R460 000 have
been capitalised, comprising advisor fees, JSE fees and
printing costs.
e. A tax rate of 28% is assumed for the pro forma adjustments.
f. All adjustments above will have a continuing effect except
where otherwise stated.
6. NUT General Meeting
6.1. A circular, including a notice convening the NUT
General Meeting, detailing the terms of the Specific
Issue as well as the action required of the
Company's shareholders will be posted to
shareholders in due course.
6.2. Further announcements concerning the relevant
dates, including the date of the NUT General
Meeting, pertaining to the Specific Issue will be
released in due course.
14 October 2014
Umhlanga
Designated Advisor: PSG Capital Proprietary Limited
Date: 14/10/2014 05:45:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE').
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