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Posting of circular, notices of general meetings and important dates and times
Fairvest Property Holdings Limited
Incorporated in the Republic of South Africa
(Registration Number: 1998/005011/06)
Linked unit code: FVT
ISIN code: ZAE000034658
(Approved as a REIT by the JSE)
(“Fairvest” or “the Company”)
POSTING OF CIRCULAR, NOTICES OF GENERAL MEETINGS AND IMPORTANT
DATES AND TIMES
1. INTRODUCTION
1.1. Fairvest linked unitholders are advised that the Company has
today, 24 April 2015, distributed a circular (“Circular”) to
linked unitholders regarding the conversion of Fairvest’s
current linked unit capital structure to a share only
structure (“Capital Conversion”) by -
1.1.1. delinking each Fairvest share from its accompanying
debenture so as to no longer constitute a linked unit
(“Delinking”);
1.1.2. implementing a scheme of arrangement in terms of section
114 of the Companies Act, No. 71 of 2008 (as amended)
(“Companies Act”), which entails –
1.1.2.1. cancelling all ordinary debentures for no consideration;
1.1.2.2. capitalising the issue price of each ordinary debenture
to the stated capital attributable to the ordinary
shares issued by the Company from an accounting
perspective for purposes of financial reporting in
accordance with International Financial Reporting
Standards (“IFRS”) and increasing the stated capital of
the Company by the issue price of each cancelled
ordinary debenture, as contemplated in section 25BB(8)
of the Income Tax Act, No. 58 of 1962 (as amended); and
1.1.2.3. terminating the Company’s debenture trust deed, without
payment or other compensation to Fairvest debenture
holders;
such scheme of arrangement being proposed by Fairvest’s
board of directors (“Board”) between the Company and its
debenture holders (“Scheme”); and
1.1.3. replacing Fairvest’s existing memorandum of incorporation
(“Existing Memorandum of Incorporation”) with a new
memorandum of incorporation (“New Memorandum of
Incorporation”), which will provide for the new share only
capital structure of the Company. The New Memorandum of
Incorporation will no longer make reference to A ordinary
shares, A debentures or A linked units (none of which are
currently in issue).
2. NOTICES OF GENERAL MEETINGS
2.1. The Circular contains notices (“Notices”) of the following
general meetings (“General Meetings”) to be held in order to
obtain the necessary approvals for the Capital Conversion –
2.1.1. a general meeting of Fairvest linked unitholders to be
held at 10:00 on Monday, 25 May 2015 at Office 18003, 18th
Floor, Triangle House, 22 Riebeek Street, Cape Town,
Western Cape, (“Linked Unitholders’ Meeting”) to consider
and, if deemed appropriate, to approve the resolutions, as
set out in the notice of the Linked Unitholders’ Meeting,
annexed to the Circular;
2.1.2. a general meeting of Fairvest debenture holders to be held
on Monday, 25 May 2015 at 10:30 or as soon as reasonably
possible after the conclusion of the Linked Unitholders’
Meeting, whichever is the earlier, to be held at the same
location as the Linked Unitholders’ Meeting, (“Debenture
Holders’ Meeting) to consider and, if deemed appropriate,
to approve the resolutions, as set out in the notice of
the Debenture Holders’ Meeting, annexed to the Circular;
and
2.1.3. a general meeting of Fairvest shareholders to be held on
Monday, 25 May 2015 at 11:00 or as soon as reasonably
possible after the conclusion of the Debenture Holders’
Meeting, whichever is the earlier, to be held at the same
location as the Debenture Holders’ Meeting,
(“Shareholders’ Meeting”) to consider and, if deemed
appropriate, to approve the resolutions, as set out in the
notice of the Shareholders’ Meeting, annexed to the
Circular.
2.2. A copy of the Circular, including the Notices of the above
General Meetings, is also available on the Company’s website
(www.fairvest.co.za).
3. RATIONALE
3.1. In terms of paragraph 13.49(c) of the Listings Requirements
of the JSE Limited (“JSE Listings Requirements“), the total
consolidated liabilities of a REIT (as reflected in the IFRS
results) may not exceed 60% of its total consolidated assets
(as reflected in its IFRS results) (“Gearing Threshold”).
3.2. The JSE Listings Requirements employ the IFRS definition of
a liability, meaning that a company is required to include
any debentures it has issued when determining whether the
Gearing Threshold above is being complied with.
3.3. For purposes of calculating the gearing ratio, the JSE has,
as an interim measure, allowed all REITS to exclude
debentures which form part of their linked unit capital
structure, including any debenture premium, when calculating
the Gearing Threshold. This interim measure will, in the
case of Fairvest, expire on 1 July 2015.
3.4. After 1 July 2015, the Company’s gearing ratio must be
calculated with reference to Fairvest’s total consolidated
liabilities, as reflected in its IFRS financial statements,
including all issued debentures.
3.5. Should the Capital Conversion be approved and be
implemented, this will result in the cancellation of all of
the Company’s debentures and reduce the Company’s gearing
ratio so as to comply with the required Gearing Threshold.
4. SCHEME CONDITIONS
4.1. The Scheme will be subject to the fulfilment of the
following conditions precedent (“Scheme Conditions”) on or
before 31 August 2015 –
4.1.1. that the Delinking be approved by the requisite majority
of linked unitholders;
4.1.2. that the Scheme be approved by the requisite majority of
debenture holders (“Scheme Special Resolution”), as
contemplated in section 115(2) of the Companies Act, and –
4.1.2.1. that, to the extent required, the Scheme be approved by
the court in terms of section 115(2)(c) of the Companies
Act; and
4.1.2.2. that, if applicable, Fairvest does not treat the Scheme
Special Resolution as a nullity, as contemplated in
section 115(5)(b) of the Companies Act;
4.1.3. that the cancellation of the Company’s authorised A
ordinary shares and the replacement of the Existing
Memorandum of Incorporation by the New Memorandum of
Incorporation be approved by the requisite majority of
shareholders;
4.1.4. that the approval of the Takeover Regulation Panel and any
other relevant regulatory authorities (either
unconditionally or subject to conditions acceptable to
Fairvest) be obtained; and
4.1.5. that, by no later than the date upon which the last of the
Scheme Conditions (excluding the Scheme Condition in this
paragraph 4.1.5) is fulfilled, no event, matter or
circumstance has arisen which in the opinion of the
directors of the Company may or will render the Capital
Conversion impractical or inadvisable to proceed with, or
which may or will render its implementation prejudicial to
the Company.
4.2. The Scheme Condition in paragraph 4.1.5 has been inserted
for the benefit of Fairvest and may be waived by Fairvest,
in its sole discretion, wholly or in part, at any time prior
to the date for fulfilment of that Scheme Condition.
4.3. Fairvest will be entitled to extend the date for the
fulfillment of any or all of the Scheme Conditions, by up to
90 days, in its sole discretion.
5. INDEPENDENT EXPERT REPORT
5.1. The Board has appointed Mazars Corporate Finance Proprietary
Limited (“Independent Expert”), in accordance with section
114(2) of the Companies Act, to provide an independent
professional expert’s opinion regarding the Scheme, and to
make appropriate recommendations to the Board in the form of
a fair and reasonable opinion.
5.2. The Independent Expert has considered the terms and
conditions of the Scheme and is of the opinion that the
terms and conditions are fair and reasonable to debenture
holders.
5.3. The full report by the Independent Expert, prepared in
accordance with section 114(3) of the Companies Act, is
contained in the Circular.
6. VIEWS OF THE BOARD
6.1. None of Fairvest directors have any conflict of interests in
relation to the Scheme and all directors are able to make
impartial decisions in relation to the Scheme. Accordingly,
all directors are considered to be independent, as defined
under Regulation 81 of the Companies Regulations, 2011 for
purposes of the Scheme.
6.2. The Board, after due consideration of the terms and
conditions of the Scheme, is in favour of the Scheme and
recommends that linked unitholders vote in favour of the
resolutions set out in the Notices.
6.3. Those directors who hold Fairvest linked units intend to
vote in favour of the resolutions set out in the Notices.
7. IMPORTANT DATES AND TIMES
2015
Record date for linked unitholders to be recorded Friday, 17 April
in the register in order to receive the Circular
Circular posted to linked unitholders on Friday, 24 April
Notices convening the General Meetings released on Friday, 24 April
SENS on
Notices convening the General Meetings published Tuesday, 28 April
in the South African press on
Last day to trade in order to be eligible to vote Friday, 8 May
at the General Meetings, on
Voting record date being 17:00 on Friday, 15 May
Proxy forms to be lodged at the transfer Thursday, 21 May
secretaries preferably by 10:00 on
Proxy forms not lodged with the transfer Monday, 25 May
secretaries to be handed to the chairman of the
applicable General Meeting before the proxy
exercises the rights of the linked unitholder,
debenture holder or shareholder (as the case may
be) at the relevant General Meeting on
Linked Unitholders’ Meeting to be held at 10:00 Monday, 25 May
on
Debenture Holders’ Meeting to be held at 10:30 Monday, 25 May
or as soon as reasonably possible after the
conclusion of the Linked Unitholders’ Meeting,
whichever is the earlier, on
Shareholders’ Meeting to be held at 11:00 or as Monday, 25 May
soon as reasonably possible after the conclusion
of the Debenture Holders’ Meeting, whichever is
the earlier, on
Results of the General Meetings released on SENS Monday, 25 May
on
Results of the General Meetings published in the Tuesday, 26 May
South African press on
If the Scheme is approved at the Debenture
Holders’ Meeting:
Last date for debenture holders who voted against Monday, 1 June
the Scheme to require Fairvest to seek court
approval for the Scheme in terms of section
115(3)(a) of the Companies Act (where applicable)
on
Last date for debenture holders who voted against Monday, 8 June
the Scheme to apply to court for leave to apply
for a review of the Scheme in terms of section
115(3)(b) of the Companies Act on
The following dates assume that no person votes
against the Scheme Special Resolution and that
neither court approvals nor the review of the
Scheme is required and will be confirmed in the
Finalisation Date announcement if the Scheme
becomes unconditional:
Registration of the New Memorandum of Monday, 8 June
Incorporation by CIPC anticipated to occur by
Finalisation date expected to be on Tuesday, 9 June
Finalisation date announcement expected to be Tuesday, 9 June
released on SENS on
Finalisation date announcement expected to be Wednesday, 10 June
published in the South African press on
Last day to trade in existing linked units on Friday, 19 June
the JSE prior to the implementation of the
Scheme (“Scheme LDT”) expected on
Suspension of listing of linked units on the Monday, 22 June
JSE expected at the commencement of trade on
Trading in delinked ordinary shares under the Monday, 22 June
new ISIN ZAE000203808 and the existing code of
“FVT” expected to commence on
Scheme record date expected to be Friday, 26 June
Operative date of the Scheme expected to be on Monday, 29 June
Expected date on which dematerialised Monday, 29 June
shareholders will have their CSDP/broker
accounts updated with their delinked ordinary
shares
Expected date of issue to certificated Monday, 29 June
shareholders of replacement share certificates for
their delinked ordinary shares
Expected date for termination of listing of Monday, 29 June
linked units on the JSE at the commencement of
trade on
Notes:
1. The above dates and times are subject to such changes as may be
announced on SENS by Fairvest, as approved by the JSE and/or the
Takeover Regulation Panel, if required.
2. If a General Meeting is adjourned or postponed, forms of proxy
submitted for such General Meeting will remain valid in respect
of any adjournment or postponement of such General Meeting.
3. Although the salient dates and times are stated to be subject to
change, such statement may not be regarded as consent or
dispensation for any change to time periods which may be
required in terms of the Companies Act or the Companies
Regulations, 2011 where applicable, and any such consents or
dispensations must be specifically applied for and granted.
4. All times referred to above are references to South African
time.
5. No dematerialisation or re-materialisation of linked units may
take place from the business day following the Scheme LDT.
24 April 2015
Cape Town
Sponsor and corporate advisor
PSG Capital
Independent Expert
Mazars
Attorneys
Cliffe Dekker Hofmeyr
Date: 24/04/2015 04:15:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE').
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