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Shareholder announcement: EGM
Choppies Enterprises Limited
(Registration number 2004/1681)
JSE share code: CHP
BSEL share code: CHOPPIES
ISIN: BW0000001072
Tax reference number: C08710401018
(“Choppies” or the “Company”, together with its subsidiaries the “Group”)
SHAREHOLDER ANNOUNCEMENT: EGM
Further to the circular issued on 14 August 2019 (the “Circular”) and subsequent announcement
released on 27 August 2019, shareholders are advised as follows:
1. The board of directors of Choppies (the “Board”) convened an emergency meeting on
Sunday, 1 September 2019, which continued on 2 September 2019, and, of the 6 directors
present, resolved by a majority vote of 5 directors to 1, to postpone the extraordinary
general meeting of the Company (“EGM”), originally scheduled to be held at 10am
tomorrow, 4 September 2019 at the Grand Aria Hotel in Gaborone, to 10am on
Wednesday, 16 October 2019 at a venue to be announced (the “Postponement of the
EGM”)
2. However, taking into account the proximity of time in relation to the originally scheduled
EGM, potential shareholder inconvenience and the requirement to comply with the
Constitution of Choppies (the “Constitution”), the Board advises shareholders that the
Postponement of the EGM in respect of the matters scheduled to be discussed and voted
upon will be requested, with the permission of the meeting, as an adjournment resolution
of the EGM by way of a majority vote at the EGM (the “Adjournment Resolution”) in
accordance with clause 19 of the Constitution. The Adjournment Resolution will be tabled
at the appropriate time during the EGM. The EGM will therefore commence as scheduled
at 10am tomorrow 4 September 2019 at the Grand Aria Hotel in Gaborone.
3. The reasons for the request for the Adjournment Resolution are set out below.
3.1 It was the intention of the Board to update and engage with shareholders at the
EGM, so as to allow them the benefit of full and complete information prior to
casting a vote on the resolutions to appoint the various candidates for the office of
director of the Company. The Board considers that such an update is in necessary
discharge of its fiduciary duties and in the best interests of shareholders and the
Company.
3.2 In the Circular, at paragraph 2.6, the Board indicated that it expected the audited
financial statements of the Group for the year ended June 2018 (the “2018 AFS”) to
have been released within a 6-8 week period of the delivery to the Board on 6
August 2019 of the Forensic Report prepared by Ernst & Young (the “Forensic
Report”). In subsequent further discussions with the external auditors of the
Company, PricewaterhouseCoopers (“PwC”), it has become clear to the Board that
the 2018 AFS will not be capable of finalisation until at least early November 2019.
It is anticipated by the Board that the Postponement of the EGM will enable further
and better information to be made available to shareholders by the time the
postponed EGM occurs.
3.3 Additionally, it has come to the Board’s attention that a vast number of
shareholders have not had the opportunity to review the Forensic Report in light of
the constraints imposed in relation to such review by Ernst & Young. The Board has
now taken the decision to make the Forensic Report public and there will be a
separate announcement by the Company as to the availability of the Forensic
Report, including on the Choppies website.
3.4 It is necessary for all shareholders to have unfettered access to the Forensic Report
so that its full import is known to and assessed by each shareholder prior to any
action by that shareholder. The Postponement of the EGM will achieve this.
3.5 The CEO has been charged on 26 August 2019 with serious misconduct and with
acts of dishonesty. His disciplinary hearing was scheduled to commence on 30
August 2019. Mr Ottapathu has however sought and obtained an interdict to
postpone the disciplinary hearing until after the EGM as originally scheduled.
Shareholders are advised that the disciplinary hearing will now take place between
30 September 2019 and 4 October 2019, before an independent and credible
Senior Counsel, Advocate NA Cassim SC, in a transparent and fair manner. The
Board has allowed Mr Ottapathu legal representation of his choice by senior
counsel even though, in a disciplinary hearing of this nature, legal representation is
not permitted in terms of the relevant Company policies written by the CEO
himself.
4. The Board was ready and prepared to hold the EGM, as originally scheduled and in terms
of its originally indicated agenda, on 4 September 2019, but it has become necessary for
the Board to take into consideration the interdict and its effect.
5. In the event that the requisite majority decision of the meeting is achieved, the EGM will
be postponed to the date indicated in paragraph 1 above. Should such a majority not be
achieved, the EGM will continue as originally scheduled and in terms of its original
agenda. All voting at the EGM, including in relation to the Adjournment Resolution, will be
by way pf poll.
Per the announcement published on 1 November 2018, the trading of the Company shares on
both the Botswana Stock Exchange Limited (“BSEL”) and its secondary listing on the
Johannesburg Stock Exchange (“JSE”) remains suspended until further notice.
The Company's primary listing is on the BSEL and its secondary listing is on the JSE.
By Order of the Board
3 September 2019
BSEL Sponsoring Broker
African Alliance Botswana Limited
JSE Sponsor
RAND MERCHANT BANK (A division of FirstRand Bank Limited)
Date: 03/09/2019 02:33:00
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