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(Incorporated in the Republic of Singapore)
(Company Registration No. 198703584K)
BY ATIC INTERNATIONAL INVESTMENT COMPANY LLC,
A WHOLLY-OWNED SUBSIDIARY OF ADVANCED TECHNOLOGY INVESTMENT COMPANY LLC,
BY WAY OF A SCHEME OF ARRANGEMENT
UNDER SECTION 210 OF THE COMPANIES ACT, CHAPTER 50 OF SINGAPORE
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MORGAN STANLEY ASIA (SINGAPORE) PTE. | CITIGROUP GLOBAL MARKETS SINGAPORE PTE. LTD. | |
(Incorporated in the Republic of Singapore) (Company Registration No. 199206298Z) | (Incorporated in the Republic of Singapore) (Company Registration No. 199002673E) |
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IMPORTANT | ||||
ADS Voting Record Date | : | 5 October 2009 at 5:00 p.m. (New York time) | ||
Last date and time for receipt by the ADS Depositary of the ADS Voting Instructions Card | : | 29 October 2009 at 10:00 a.m. (New York time) | ||
Last date and time for lodgement of Proxy Form for the Court Meeting | : | 2 November 2009 at 11:00 a.m. | ||
Date and time of the Court Meeting | : | 4 November 2009 at 11:00 a.m. | ||
Place of the Court Meeting | : | Republic Polytechnic Lecture Theatre at W2 (LT-W2) Level 1, 9 Woodlands Avenue 9 Singapore 738964 |
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OVERSEAS SHAREHOLDERS | 62 | |||||
TAXATION | 63 | |||||
ACTION TO BE TAKEN BY SHAREHOLDERS AND ADS HOLDERS | 66 | |||||
IFA’S ADVICE TO THE INDEPENDENT DIRECTORS | 67 | |||||
GENERAL | 67 | |||||
68 | ||||||
71 | ||||||
74 | ||||||
101 | ||||||
113 | ||||||
146 | ||||||
154 | ||||||
156 | ||||||
158 | ||||||
169 | ||||||
205 | ||||||
211 | ||||||
213 | ||||||
220 |
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“Abu Dhabi” | : The Emirate of Abu Dhabi, United Arab Emirates. | |
“Accelerated Amount” | : Has the meaning given to it inParagraph 3.10 of the Company’s Letter to Shareholders. | |
“Acquiror” | : ATIC International Investment Company LLC, a company incorporated in Abu Dhabi and having its offices at Mamoura Building A, Muroor Road, Abu Dhabi. | |
“Acquiror Affiliates” | : The parties acting in concert with the Acquiror (including ATIC and its subsidiaries) from time to time. | |
“Acquiror Convertible Securities” | : Securities which carry voting rights in the Acquiror or are convertible into Acquiror Shares or securities which carry voting rights in the Acquiror, or rights to subscribe for, or options in respect of, such Acquiror Shares or securities. | |
“Acquiror Directors” | : The directors of the Acquiror as at the Latest Practicable Date. | |
“Acquiror Shares” | : Issued and paid-up ordinary shares in the capital of the Acquiror. | |
“Acquisition” | : The proposed acquisition of the Company by the Acquiror pursuant to the Implementation Agreement. | |
“ACRA” | : The Accounting and Corporate Regulatory Authority of Singapore. | |
“ADRs” or “American Depositary Receipts” | : The certificates issued by the ADS Depositary to evidence the ADSs issued under the terms of the ADS Deposit Agreement, as such ADRs may be amended from time to time in accordance with the provisions of the ADS Deposit Agreement. | |
“ADSs” or “American Depositary Shares” | : The rights and interests in the Company Shares deposited under the ADS Deposit Agreement granted to the ADS Holders and beneficial owners pursuant to the terms and conditions of the ADS Deposit Agreement and, if applicable, the ADRs issued to evidence the ADSs issued thereunder. Each ADS represents the right to receive 10 Company Shares on deposit with the ADS Custodian Bank. | |
“ADS Custodian Bank” | : Citibank Nominees Singapore Pte Ltd. | |
“ADS Deposit Agreement” | : The Deposit Agreement by and among the Company, the ADS Depositary, the ADS Holders and beneficial owners of |
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ADSs evidenced by ADRs issued thereunder, dated 4 November 1999, as amended on 26 September 2007. | ||
“ADS Depositary” | : Citibank, N.A. | |
“ADS Depositary Notice” | : The notice given by the ADS Depositary to the ADS Holders as at the ADS Voting Record Date to provide,inter alia, notice of (i) how an ADS Holder may instruct the ADS Depositary to vote, or cause the ADS Custodian Bank to vote, the Company Shares underlying such ADS Holder’s ADSs at the Court Meeting and at the EGM, and (ii) the termination of the ADS Deposit Agreement (conditional upon the effectiveness of the Scheme). | |
“ADS Holder” | : The person or entity in whose name an ADS is registered on the books of the ADS Depositary maintained for such purpose. An ADS Holder may or may not be a beneficial owner of the ADSs. If an ADS Holder is not the beneficial owner of the ADSs registered in its name, such ADS Holder shall be deemed to have all requisite authority to act on behalf of the beneficial owners of the ADSs. | |
“ADS Voting Deadline” | : 10:00 a.m. (New York time) on 29 October 2009, being the latest time by which the ADS Voting Instructions Cards must be received by the ADS Depositary. | |
“ADS Voting Instructions Card” | : The voting instructions card for use by ADS Holders to instruct the ADS Depositary to vote the Company Shares represented by their ADSs in connection with the Court Meeting. | |
“ADS Voting Record Date” | : 5:00 p.m. (New York time) on 5 October 2009. | |
“Announcement” | : The joint announcement by the respective boards of directors of the Company and the Acquiror dated 7 September 2009 in relation to the Acquisition by way of the Scheme. | |
“Announcement Date” | : 7 September 2009, being the date of the Announcement. | |
“Applicable Laws” | : With respect to any person, any national, federal, state or local law (statutory, common or otherwise), constitution, treaty, convention, ordinance, code, rule, regulation, order, injunction, judgement, decree, ruling or other similar requirement enacted, adopted, promulgated or applied by a Governmental Authority that is binding upon or applicable to such person, as amended unless expressly specified otherwise. |
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“Articles” | : The Articles of Association of the Company. | |
“ATIC” | : Advanced Technology Investment Company LLC, a company incorporated in Abu Dhabi and having its offices at Mamoura Building A, Muroor Road, Abu Dhabi. | |
“ATIC Convertible Securities” | : Securities which carry voting rights in ATIC or are convertible into ATIC Shares or securities which carry voting rights in ATIC, or rights to subscribe for, or options in respect of, such ATIC Shares or securities. | |
“ATIC Directors” | : The directors of ATIC as at the Latest Practicable Date. | |
“ATIC Shares” | : Issued and paid-up ordinary shares in the capital of ATIC. | |
“Auditors” | : KPMG LLP, the auditors of the Company for the time being. | |
“Auditors’ Letter on the Outlook” | : Letter dated 22 September 2009 containing the report of the Auditors on the Outlook. | |
“Board” | : The board of directors of the Company. | |
“Books Closure Date” | : A date and time (before the Effective Date) to be announced by the Company on which the Transfer Books and the Register of Members of the Company will be closed in order to determine the entitlements of Shareholders under the Scheme. | |
“Business Day” | : Unless otherwise expressly specified, (i) a day (excluding Fridays, Saturdays and gazetted public holidays in Abu Dhabi) on which commercial banks are open for business in Abu Dhabi in relation to acts or matters to be done or delivered pursuant to the Implementation Agreement in such location or to acts or matters to be done or delivered by the Acquiror, (ii) a day (excluding Saturdays, Sundays and gazetted public holidays in Singapore) on which commercial banks are open for business in Singapore in relation to acts or matters to be done or delivered pursuant to the Implementation Agreement in such location or to acts or matters to be done or delivered by the Company and (iii) a day (excluding Fridays, Saturdays, Sundays and gazetted public holidays) on which commercial banks are open for business in Abu Dhabi and Singapore in relation to acts or matters to be done or delivered pursuant to the Implementation Agreement in both locations (such acts or matters to include the transfer of funds by the Acquiror for settlement of the Scheme Consideration). | |
“CDP” | : The Central Depository (Pte) Limited. |
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“CEO” | : Chief Executive Officer. | |
“Citi” | : Citigroup Global Markets Singapore Pte. Ltd. | |
“Class Meeting” | : Has the meaning given to it inParagraph 19.1 of the Company’s Letter to Shareholders. | |
“Code” | : The Singapore Code on Take-overs and Mergers. | |
“Companies Act” | : The Companies Act, Chapter 50 of Singapore. | |
“Company” | : Chartered Semiconductor Manufacturing Ltd. | |
“Company Convertible Securities” | : Securities which carry voting rights in the Company or are convertible into Company Shares or securities which carry voting rights in the Company, or rights to subscribe for, or options in respect of, such Company Shares or securities. | |
“Company Shares” | : Issued and paid-up ordinary shares in the capital of the Company from time to time. | |
“Competing Offer” | : Any offer or proposal by any person (other than the Acquiror or the parties acting in concert with it), pursuant to which such person or any other person may, whether directly or indirectly, and whether by share purchase, scheme of arrangement or amalgamation, capital reconstruction, purchase of assets, tender offer, general offer, partial offer, joint venture, dual listed company structure or otherwise: |
(i) | acquire or become the holder or owner of, or otherwise have an economic interest in: (a) all or substantially all the assets, businessand/or undertakings of the Company, or any Relevant Group Company, or (b) all or a significant portion of the share capital of the Company, or (c) any part of the share capital of a Relevant Group Company which is held by the Company; | ||
(ii) | acquire control of the Group; | ||
(iii) | merge with the Company or a Relevant Group Company; or | ||
(iv) | effect a transaction which would preclude or restrict the Scheme or the Offer, as the case may be, or the Acquisition, |
and for the purpose of this definition, a Competing Offer (I) will be deemed to be for “substantially all of the assets, |
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businessand/or undertakings” of the Company or any Relevant Group Company if the relevant assets, businessand/or undertakings in question computed on any of the bases set out in rules 1006(a) to 1006(c) of the Listing Manual (if applicable) amount to 30 per cent. or more, except that the net asset figures used for comparison with the transaction under consideration will be taken from the later of the latest audited accounts or the latest unaudited accounts (if any) of the Company or the Relevant Group Company and (II) shall not include the exercise of any call option by the shareholders under the CSP JVA. | ||
“Compulsory Acquisition” | : The compulsory acquisition of Company Shares by the Acquiror pursuant to Section 215(1) of the Companies Act in the event that the Offer becomes or is declared unconditional in all respects and the Acquiror has received acceptances in respect of not less than 90 per cent. of the number of Company Shares which are the subject of the Offer (other than Company Shares already held at the date of the Offer by the Acquiror, its related corporations or their respective nominees). | |
“Compulsory Acquisition Completion Date” | : The date and time of the completion of the Compulsory Acquisition. | |
“Consideration” | : The amount payable by the Acquiror for each Company Share to which the Scheme or the Offer relates, in accordance with the terms of the Scheme or the Offer, as the case may be. | |
“Conversion Agent” | : Has the meaning given to it in Article 4A of the Articles. | |
“Conversion Notice” | : Has the meaning given to it in Article 4A of the Articles. | |
“Converted Amount” | : Has the meaning given to it inParagraph 13.3.1 of the Explanatory Statement. | |
“COO” | : Chief Operating Officer. | |
“Court” | : The High Court of Singapore. | |
“Court Meeting” | : The meeting of Shareholders to be convened at the direction of the Court to approve the Scheme, notice of which is set out on pages 220 and 221 of this Scheme Document, and any adjournment thereof. | |
“Court Order” | : The order of the Court approving the Scheme under Section 210 of the Companies Act. |
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“Credit Suisse” | : Credit Suisse (Singapore) Limited. | |
“CRPS” | : Convertible redeemable preference shares in the capital of the Company, having the rights and subject to the restrictions set out in Article 4A of the Articles. | |
“CSP JVA” | : The Amended and Restated Joint Venture Agreement dated 23 October 2001 among the Company, EDB Investments Pte Ltd, Singapex Investments Pte Ltd and Avago Technologies General IP (Singapore) Pte. Ltd., as amended and supplemented by Amendment Agreement No. 1 dated 31 January 2002 and Deed of Accession and Ratification dated 26 January 2006. | |
“DB Related Entities” | : Has the meaning given to it inParagraph 3.1.1(iii) ofAppendix 4 of this Scheme Document. | |
“Deutsche Bank” | : Deutsche Bank AG, Singapore Branch. | |
“Directors” or “Company Directors” | : The directors of the Company as at the Latest Practicable Date. | |
“DTC” | : The Depository Trust Company, being the book-entry settlement facility for ADSs in the United States. | |
“Early Redemption Price” | : Has the meaning given to it in Article 4A of the Articles. | |
“Effective Date” | : The date on which the Scheme, if approved, becomes effective in accordance with its terms. | |
“EGM” | : Has the meaning given to it inParagraph 19.1 of the Company’s Letter to Shareholders. | |
“Encumbrances” | : All charges, mortgages, liens, hypothecations, judgments, encumbrances, easements, rights of pre-emption, securities, title retentions, preferential rights, preferential arrangements, trust arrangements or all other security interests or all other agreements or arrangements having a commercial effect analogous to the conferring of security or a similar right in favour of any person, and “Encumbrance” shall mean any of the above. | |
“Entitled Shareholders” | : Shareholders as at 5:00 p.m. on the Books Closure Date. | |
“ERCC” | : The Executive Resource and Compensation Committee of the Company. | |
“ESOP” | : The Company’s Share Option Plan 1999 approved and adopted on 30 March 1999, as amended and restated on |
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30 May 2001 and as the same may be further modified or altered from time to time. | ||
“Exchange Act” | : U.S. Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder. | |
“Explanatory Statement” | : The Explanatory Statement in compliance with Section 211 of the Companies Act as set out on pages 51 to 67 of this Scheme Document. | |
“Fairness Opinion” | : Each of: | |
(i) the oral opinion of Morgan Stanley, subsequently confirmed in writing, addressed solely to the Board, as to the fairness of the Scheme Consideration from a financial point of view to the holders of Company Shares (including Company Shares held in the form of ADSs), which is set out inAppendix 1A of this Scheme Document; and | ||
(ii) the oral opinion of Citi, subsequently confirmed in writing, addressed solely to the Board, as to the fairness of the Scheme Consideration from a financial point of view to the Shareholders and the ADS Holders (in each case, other than STS), which is set out inAppendix 1B of this Scheme Document, | ||
and “Fairness Opinions” shall mean both of them. | ||
“FAs” | : Morgan Stanley Asia (Singapore) Pte. and Citigroup Global Markets Singapore Pte. Ltd., the joint financial advisers to the Board in connection with the Acquisition and the Scheme. | |
“Fee” | : Has the meaning given to it inParagraph 3.9 of the Company’s Letter to Shareholders. | |
“First Restricted Period” | : The period from and including the Announcement Date to the date of termination of the Implementation Agreement in accordance with its terms and for a period of six months after such termination. | |
“FY” | : Financial year ended or ending 31 December of a particular year, as the case may be. Where “FY” is stated immediately before reference to a calendar year, it shall mean the financial year ended or ending 31 December of that calendar year. | |
“GLOBALFOUNDRIES” | : GlobalFoundries, Inc. |
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“GLOBALFOUNDRIES Employment Agreement” | : The employment agreement dated 29 September 2009 between Chia Song Hwee and GLOBALFOUNDRIES. | |
“Governmental Authority” | : Any domestic or foreign national, federal, state or local, government or governmental, semi-governmental, administrative, regulatory, fiscal or judicial agency, authority, body, commission, department, exchange, tribunal, court, agency, official or entity, including any political subdivision thereof. | |
“Group” | : The Company and its subsidiaries, and “Group Company” shall mean any company in the Group. | |
“GS” | : Goldman Sachs International. | |
“GS Option” | : The equity option transaction entered into between the Company and GS, as evidenced by the confirmation dated 27 March 2007 (reference number LTAA1419140936.0.0.0/00643091201), as amended and supplemented from time to time between the Company and GS. | |
“IFA” | : Deutsche Bank AG, Singapore Branch, the independent financial adviser to the Independent Directors. | |
“IFA’s Letter on the Outlook” | : Letter containing the report of the IFA on the Outlook as set out inAppendix 11 of this Scheme Document. | |
“IFA’s Letter on the Scheme” | : Has the meaning given to it inParagraph 15.2 of the Company’s Letter to Shareholders. | |
“Implementation Agreement” | : The Implementation Agreement dated 7 September 2009 between the Company and the Acquiror to effect the Acquisition by way of the Scheme. | |
“Independent Directors” | : The Directors who are considered independent under the Code for the purposes of making a recommendation to Shareholders on the Scheme or, where relevant, the Offer. | |
“IR Code” | : The United States Internal Revenue Code of 1986, as amended. | |
“Irrevocable Undertakings” | : The STS Irrevocable Undertaking and the Management Executive Irrevocable Undertakings. | |
“Latest Practicable Date” | : 1 October 2009, being the latest practicable date prior to the printing of this Scheme Document. | |
“Listing Manual” | : The Listing Manual of the SGX-ST, as amended or modified from time to time. |
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“Long-Stop Date” | : 8 March 2010, as may be extended as described inParagraph 3.1 of the Company’s Letter to Shareholders. | |
“Management Executive Irrevocable Undertakings” | : The letters of undertaking dated 7 September 2009 between (i) each of Chia Song Hwee and George Thomas, and (ii) the Acquiror and ATIC, pursuant to which each of Chia Song Hwee and George Thomas has given an irrevocable undertaking to the Acquiror to,inter alia, vote in favour of the Scheme, on terms described inParagraph 6.2 of the Company’s Letter to Shareholders, and “Management Executive Irrevocable Undertaking” shall mean either of them. | |
“Market Day” | : A day on which the SGX-ST is open for trading of securities or, where applicable, a day on which Nasdaq is open for trading of securities. | |
“Matching Offer Determination” | : Has the meaning given to it inParagraph 3.5.3 of the Company’s Letter to Shareholders. | |
“Matching Right” | : Has the meaning given to it inParagraph 3.5.1 of the Company’s Letter to Shareholders. | |
“Matching Right Notification” | : Has the meaning given to it inParagraph 3.5.1 of the Company’s Letter to Shareholders. | |
“Matching Right Period” | : Has the meaning given to it inParagraph 3.5.2 of the Company’s Letter to Shareholders. | |
“Material Obligations” | : Means the obligations of the Company under the Implementation Agreement: | |
(i) to comply with certain procedural aspects relating to the implementation of the Scheme, including: | ||
(a) taking all steps required to be taken by it in relation to the Scheme; | ||
(b) the preparation of this Scheme Document; | ||
(c) making an application to the Court for order(s) to convene the Court Meeting; | ||
(d) despatching this Scheme Document; | ||
(e) applying to the Court for the Court Order if the Scheme is approved by the requisite majorities at the Court Meeting; | ||
(f) lodging the Court Order with ACRA; |
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(g) ensuring that the Company, through its legal counsel, is represented at Court hearings convened for the purpose of Section 210 of the Companies Act; and | ||
(h) not taking any action which may frustrate or be prejudicial to the successful completion of the Acquisition or the implementation of the Scheme, subject to the provisions described inParagraph 3.5 of the Company’s Letter to Shareholders; and | ||
(ii) as described inParagraphs 3.5, 3.7 and19 of the Company’s Letter to Shareholders. | ||
“Morgan Stanley” | : Morgan Stanley Asia (Singapore) Pte. | |
“Nasdaq” | : Nasdaq Global Select Market. | |
“Nasdaq Listing Rules” | : The Listing Rules of Nasdaq, as amended or modified from time to time. | |
“Net Converted Amount” | : Has the meaning given to it inParagraph 13.3.2 of the Explanatory Statement. | |
“New Member” | : Has the meaning given to it inParagraph 19.2.1 of the Company’s Letter to Shareholders. | |
“No-Shop Period” | : The period commencing from the Announcement Date to the termination of the Implementation Agreement in accordance with its terms or, where the Switch Option is validly exercised, to the later of the closing date of the Offer or the date the Offer lapses or is withdrawn. | |
“Offer” | : The voluntary conditional cash offer by or on behalf of the Acquiror to acquire Company Shares not already owned, controlled or agreed to be acquired by the Acquiror, on the terms and subject to the conditions which will be set out in the offer document issued for or on behalf of the Acquiror. | |
“Offer Cut-Off Date” | : The closing date of the Offer, provided that: | |
(i) the Offer has become or been declared unconditional in all respects; and | ||
(ii) the Acquiror is entitled to exercise its rights of Compulsory Acquisition. | ||
“Options” | : Options granted by the Company pursuant to the ESOP. |
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“Outlook” | : The outlook set forth in Appendix 1 to the Company’s guidance for the third quarter ended 30 September 2009 that was released by the Company on 22 September 2009 and reproduced inAppendix 10 of this Scheme Document, which updated the Company’s third quarter 2009 guidance originally provided on 24 July 2009. | |
“Overseas Shareholders” | : Shareholders whose addresses are outside Singapore and the United States as shown on the Register of Members of the Company and the Depository Register maintained by CDP. | |
“Parties” | : The Company and the Acquiror, and “Party” shall mean either of them. | |
“PFIC” | : Passive foreign investment company, as the term is defined under United States taxation law. | |
“Preference Share Holders” | : Holders of CRPS. | |
“Preference Share Offer” | : The offer to be made by the Acquiror to the Preference Share Holders, as described inParagraph 3.1 of the Letter from the Acquiror to Shareholders inAppendix 3 of this Scheme Document. | |
“Prescribed Occurrences” | : Any event, reproduced inAppendix 6 of this Scheme Document, the occurrence of which between the Announcement Date and the Record Date would be a failure to fulfill one of the Scheme Conditions. | |
“Proxy Form” | : The proxy form for the Court Meeting. | |
“PSU Plan” | : The Company’s Performance Share Unit Plan 2007, approved and adopted on 24 April 2007, as the same may be modified or altered from time to time. | |
“PSUs” | : Units granted under the PSU Plan. | |
“Record Date” | : The date falling on the Business Day in Singapore immediately preceding the Effective Date. | |
“Redemption Amount” | : Has the meaning given to it in Article 4A of the Articles. | |
“Register of Substantial Shareholders” | : The Register of Substantial Shareholders of the Company. | |
“Relevant Group Company” | : Any of Chartered Semiconductor Manufacturing (Tampines) Pte. Ltd., Chartered Silicon Partners Pte Ltd and SMP. |
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“Restricted Affiliates” | : Certain persons (other than the Acquiror Affiliates) agreed in writing between the Parties at the Announcement Date. | |
“RSU Plan” | : The Company’s Restricted Share Unit Plan 2007, approved and adopted on 24 April 2007, as the same may be modified or altered from time to time. | |
“RSUs” | : Units granted under the RSU Plan. | |
“Scheme” | : The scheme of arrangement under Section 210 of the Companies Act, on the terms and subject to the conditions set out in this Scheme Document, as such Scheme may be amended or revised from time to time. | |
“Scheme Conditions” | : The conditions precedent which must (unless, where applicable, waived) be satisfied by not later than 5:00 p.m. on the Long-Stop Date (or such other date as the Company and the Acquiror may agree) for the Scheme to be implemented, and which are reproduced inAppendix 5 of this Scheme Document. | |
“Scheme Consideration” | : The cash amount of S$2.68 for each Scheme Share to be paid by the Acquiror to each Entitled Shareholder in accordance with the terms of the Scheme. | |
“Scheme Document” | : This document dated 9 October 2009 and any other document(s) which may be issued by or on behalf of the Company to amend, revise, supplement or update the document(s) from time to time. | |
“Scheme Shares” | : Has the meaning given to it inParagraph 2.3 of the Company’s Letter to Shareholders. | |
“SEC” | : The Securities and Exchange Commission of the United States. | |
“Second Restricted Period” | : The period from and including the Announcement Date to the later of (i) the date falling two years after the date of termination of the Implementation Agreement or (ii) the date | |
when the aggregate direct or indirect shareholding of the Acquiror and the Acquiror Affiliates falls below one per cent. of the voting rights of the Company from time to time. | ||
“Securities Account” | : The securities account maintained by a Depositor with CDP but excluding any securities sub-account. | |
“Securities Act” | : U.S. Securities Act of 1933, as amended. | |
“SGXNET” | : The website of the SGX-ST. |
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“SGX-ST” | : Singapore Exchange Securities Trading Limited. | |
“Shareholders” | : Persons who are registered as holders of Company Shares in the Register of Members of the Company and, where such person is CDP, Depositors who have Company Shares entered against their names in the Depository Register. | |
“SIC” | : The Securities Industry Council of Singapore. | |
“SIC Competitive Procedure” | : Any procedure which may, from time to time, be established by the SIC to resolve a competitive situation. | |
“Singapore” | : The Republic of Singapore. | |
“Singapore Dollars” or “S$” | : Singapore dollars, being the lawful currency of Singapore. | |
“SMP” | : Silicon Manufacturing Partners Pte Ltd. | |
“Special Resolution (1)” | : Has the meaning given to it inParagraph 19.1 of the Company’s Letter to Shareholders. | |
“Special Resolution (2)” | : Has the meaning given to it inParagraph 19.1 of the Company’s Letter to Shareholders. | |
“STS” | : Singapore Technologies Semiconductors Pte Ltd. | |
“STS Irrevocable Undertaking” | : The letter of undertaking dated 7 September 2009 between STS and the Acquiror and ATIC, pursuant to which STS has given an irrevocable undertaking to the Acquiror to,inter alia, vote in favour of the Scheme, on terms described inParagraph 6.1 of the Company’s Letter to Shareholders. | |
“Substantial Shareholder” | : Any person holding interests in five per cent. or more of all the Company Shares. | |
“Superior Offer” | : Has the meaning given to it inParagraph 3.5.1 of the Company’s Letter to Shareholders. | |
“Switch Option” | : Has the meaning given to it inParagraph 3.6.1 of the Company’s Letter to Shareholders. | |
“Termination Right” | : Has the meaning given to it inParagraph 3.3 of the Company’s Letter to Shareholders. | |
“Transfer Books” | : The transfer books of the Company. | |
“Transfer Consideration” | : The Consideration, subject to any adjustments, if required, in the event of a sub-division or consolidation of the ordinary share capital of the Company, such adjustments to be determined by the Board of Directors of the Company as appropriate. |
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“Transfer Date” | : Means: | |
(i) where the Acquisition is to be effected by way of a Scheme: | ||
(a) in the case of any new Company Shares which are issued to any New Member after the Voting Record Time and on or prior to the Effective Date, the date and time immediately after the Effective Date; and | ||
(b) in the case of any new Company Shares which are issued to any New Member after the Effective Date, the date and time immediately after the issue of any such new Company Shares; and | ||
(ii) where the Acquisition is to be effected by way of an Offer: | ||
(a) in the case of any new Company Shares which are issued to any New Member after the Offer Cut-Off Date and on or prior to the Compulsory Acquisition Completion Date, the date and time immediately after the Compulsory Acquisition Completion Date; and | ||
(b) in the case of any new Company Shares which are issued to any New Member after the Compulsory Acquistion Completion Date, the date and time immediately after the issue of any such new Company Shares. | ||
“United States” or “U.S.” | : The United States of America, its territories and possessions, any State of the United States of America and the District of Columbia. | |
“United States Dollars” and “US$” | : United States dollars, being the lawful currency of the United States. | |
“Unsolicited Offer” | : Has the meaning given to it inParagraph 3.7.2 of the Company’s Letter to Shareholders. | |
“U.S. Treasury” | : The Treasury of the United States. | |
“Voting Record Time” | : 48 hours before the date and time of the Court Meeting. |
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“VWAP” | : Volume weighted average price. | |
“%” or “per cent.” | : Per centum or percentage. |
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ADS Voting Record Date | : | 5 October 2009, 5:00 p.m. (New York time)(1) | ||
Latest date and time for receipt by the ADS Depositary of the ADS Voting Instructions Card | : | 29 October 2009, 10:00 a.m. (New York time) | ||
Latest date and time for lodgement of the Proxy Form | : | 2 November 2009, 11:00 a.m.(2)(3) | ||
Date and time of the Court Meeting | : | 4 November 2009, 11:00 a.m. | ||
Place of the Court Meeting | : | Republic Polytechnic Lecture Theatre at W2 (LT-W2) Level 1, 9 Woodlands Avenue 9 Singapore 738964 | ||
Expected date of the Court hearing the application to approve the Scheme | : | 12 November 2009 | ||
Expected last day of trading of the Company Shares on the SGX-ST | : | 4 December 2009 | ||
Expected Books Closure Date | : | 9 December 2009, 5:00 p.m.(4) | ||
Expected Record Date | : | 9 December 2009(5) | ||
Expected Effective Date | : | 10 December 2009(6) | ||
Expected date of termination of the ADS Deposit Agreement and expected last day of trading of the ADSs | : | 10 December 2009(5) | ||
Expected date for the payment of the Scheme Consideration | : | By 18 December 2009(5) | ||
Expected date for delisting of the Company from the SGX-ST | : | On or about 18 December 2009(5) | ||
Expected date for delisting of the ADSs from Nasdaq | : | On or about 21 December 2009(5) |
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(1) | Withdrawal of the Company Shares underlying the ADSs is expected to be suspended from the ADS Voting Record Date to the conclusion of the Court Meeting. | |
(2) | Shareholders are requested to lodge the Proxy Forms not less than 48 hours before the time appointed for the Court Meeting, but if they are not so lodged, they may be handed to the Chairman of the Court Meeting at the Court Meeting and before the commencement of the Court Meeting. | |
(3) | All Proxy Forms (if lodged before the Court Meeting) must be lodged with the Company Secretary at the registered office of the Company at 60 Woodlands Industrial Park D Street 2 Singapore 738406. Completion and lodgement of a Proxy Form will not preclude a Shareholder from attending and voting in person at the Court Meeting. | |
(4) | No transfer of Company Shares may be effected after 5:00 p.m. on the Books Closure Date. | |
(5) | Assuming that the Effective Date is 10 December 2009. | |
(6) | The Scheme will only be effective and binding upon lodgement of the Court Order with ACRA. The Court Order will be lodged with ACRA upon the satisfaction (or, where applicable, waiver) of all the Scheme Conditions and provided neither the Acquiror nor the Company exercises its Termination Right (if any). |
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DIRECTORS | : | James A. Norling (Chairman) Chia Song Hwee (President and CEO) Philip Tan Yuen Fah (Chairman of the Audit Committee) Peter Seah Lim Huat (Chairman of the ERCC) Charles E. Thompson Tay Siew Choon Pasquale Pistorio Steven H. Hamblin Maurizio Ghirga | ||||
COMPANY SECRETARY | : | Looi Lee Hwa | ||||
REGISTERED OFFICE | : | 60 Woodlands Industrial Park D Street 2 Singapore 738406 | ||||
SHAREHOLDERS SERVICES FOR COMPANY SHARES | : | M&C Services Private Limited 138 Robinson Road #17-00 The Corporate Office Singapore 068906 | ||||
SHAREHOLDERS SERVICES FOR AMERICAN DEPOSITARY SHARES | : | Citibank, N.A. 250 Royall Street Canton, MA 02021 United States of America | ||||
LEGAL ADVISER TO THE SCHEME AS TO SINGAPORE LAW | : | Allen & Gledhill LLP Advocates & Solicitors One Marina Boulevard #28-00 Singapore 018989 | ||||
LEGAL ADVISER TO THE SCHEME AS TO U.S. LAW | : | Latham & Watkins LLP 9 Raffles Place #42-02 Republic Plaza Singapore 048619 |
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JOINT FINANCIAL ADVISERS TO THE BOARD | : | Morgan Stanley Asia (Singapore) Pte. 23 Church Street #16-01 Capital Square Singapore 049481 | ||||
Citigroup Global Markets Singapore Pte. Ltd. 3 Temasek Avenue #12-00 Centennial Tower Singapore 039190 | ||||||
INDEPENDENT FINANCIAL ADVISER TO THE INDEPENDENT DIRECTORS | : | Deutsche Bank AG, Singapore Branch One Raffles Quay #17-00 South Tower Singapore 048583 | ||||
AUDITORS | : | KPMG LLP 16 Raffles Quay #22-00 Hong Leong Building Singapore 048581 |
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Company | Chartered Semiconductor Manufacturing Ltd., a company incorporated in Singapore. | |||
Acquiror | ATIC International Investment Company LLC, a company incorporated in Abu Dhabi and wholly-owned by Advanced Technology Investment Company LLC, which is a technology investment company wholly-owned by the Government of Abu Dhabi. | |||
Scheme | The Acquisition will be effected by way of the Scheme and in accordance with the Code. | |||
Scheme Terms | Under the Scheme, all the Scheme Shares held by Entitled Shareholders will be transferred to the Acquiror (i) fully paid, (ii) free from all Encumbrances and (iii) together with all rights, benefits and entitlements as at the Announcement Date and thereafter attaching thereto, including the right to receive and retain all dividends, rights and other distributions (if any) which may be announced, declared, paid or made by the Company on or after the Announcement Date. | |||
Scheme Consideration | S$2.68 in cash for each Scheme Share. | |||
Scheme Shares | The Scheme will be extended, on the same terms and conditions to: | |||
(i) | all Company Shares, including Company Shares represented by ADSs; and | |||
(ii) | all new Company Shares unconditionally issued or to be issued on or before the Books Closure Date pursuant to (a) the valid exercise of any Options (b) the vesting of any awards under the RSU Plan, (c) the vesting of any awards under the PSU Plan, (d) the valid conversion of any CRPS into new Company Shares and (e) the valid exercise by GS of the GS Option. | |||
For the purpose of the Scheme, the expression “Scheme Shares” shall include existing Company Shares and such new Company Shares. |
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Scheme Conditions | The Scheme is conditional upon the satisfaction (or, where applicable, waiver) of the Scheme Conditions by not later than 5:00 p.m. on 8 March 2010, as may be extended as described inParagraph 3.1 of the Company’s Letter to Shareholders. Full details of the Scheme Conditions are reproduced inAppendix 5 of this Scheme Document. | |||
Court Meeting | The Scheme has to be approved at the Court Meeting by a majority in number of, and representing not less than 75 per cent. in value of the Company Shares held by, Shareholders present and voting, either in person or by proxy, at the Court Meeting. Voting at the Court Meeting will be by way of poll. | |||
When the Scheme, with or without modification, becomes effective, it will be binding on all Entitled Shareholders, whether or not they were present in person or by proxy, and whether or not they voted at the Court Meeting, and if they voted, whether or not they voted in favour of the Scheme at the Court Meeting. For the avoidance of doubt, on and from the Effective Date, the Scheme will also be binding on the ADS Custodian Bank and the ADS Depositary in respect of the Company Shares underlying the ADSs, irrespective of how the ADS Holders instructed the ADS Depositary to vote at the Court Meeting. | ||||
Shareholders do not have any specific rights to require an independent appraisal of the value of the Company Shares in connection with the Scheme. | ||||
Delisting, Termination of ADS Deposit Agreement and Deregistration with the SEC | Upon the Scheme becoming effective and binding, the Company will become a wholly-owned subsidiary of the Acquiror, and (i) subject to the approval of the SGX-ST, the Company will be delisted from the Official List of the SGX-ST and (ii) subject to the filing of a notification with the SEC and prior written notification to Nasdaq, the ADSs will be delisted from Nasdaq. The Company also intends to deregister the Company Shares and ADSs with the SEC and terminate its reporting obligations under the Exchange Act. Notice is hereby given that, conditional upon the Scheme becoming effective, the ADS Deposit Agreement will be terminated as at the Effective Date. |
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Rationale of the Acquisition | ATIC has made a significant investment in the outsourced semiconductor manufacturing, commonly referred to as “foundry”, industry with the creation of GLOBALFOUNDRIES. GLOBALFOUNDRIES offers its customers leading edge foundry services from its facility in Dresden, Germany and is currently developing a new facility in New York, the United States. The Acquisition would allow ATIC to build on the complementary platforms of the Company and GLOBALFOUNDRIES, utilising the Company’s customer relationships and capabilities in both 8-inch and 12-inch fabrication, and GLOBALFOUNDRIES’ advanced technology expertise, capacity profile and global footprint, and capitalise on the continued growth in the global semiconductor foundry industry. | |||
Financial Evaluation of the Scheme Consideration | The Scheme Consideration represents premiums of: (i) (a) 14.2%, (b) 26.8% and (c) 44.2% to the benchmark prices of the Company Shares on the SGX-ST; and | |||
(ii) | (a) 15.2%, (b) 28.5% and (c) 56.1% to the benchmark prices of the ADSs on Nasdaq, | |||
for the periods of (a) 30 trading days, (b) 90 trading days and (c) six months, respectively, up to 4 September 2009, being the latest practicable date prior to the Announcement Date. | ||||
STS Irrevocable Undertaking | STS, which held 586,752,688 Company Shares as at the Latest Practicable Date, representing approximately 62.28 per cent. of all the Company Shares, has entered into a letter of undertaking dated 7 September 2009 with the Acquiror and ATIC, pursuant to which it has given an irrevocable undertaking to the Acquiror to,inter alia, (i) vote or procure the voting of all its Company Shares in favour of the Scheme at the Court Meeting, or accept the Offer in respect of all of its Company Shares in the event the Acquiror validly exercises the Switch Option, and (ii) to the extent permitted by applicable laws, vote or procure the voting of all its Company Shares in favour of Special Resolution (1) and Special Resolution (2) at the EGM. | |||
Management Executive Irrevocable Undertakings | Each of Chia Song Hwee (President and CEO of the Company) and George Thomas (Chief Financial Officer of the Company) has entered into a letter of undertaking dated 7 September 2009 with the Acquiror and ATIC, pursuant to which each of them has given an irrevocable undertaking to the Acquiror on terms substantially similar to the STS Irrevocable Undertaking. |
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Directors’ Intentions | As at the Latest Practicable Date all Directors intend to vote in favour of the Scheme at the Court Meeting in respect of their own beneficial shareholdings. | |||
IFA’s Advice to the Independent Directors in relation to the Scheme | Subject to the qualifications, bases and further advice set out in the IFA’s Letter on the Scheme, the IFA has advised the Independent Directors to recommend that, in the absence of a superior offer, Shareholders shouldvote in favour of the Scheme at the Court Meeting. | |||
The summary above should be read in conjunction with, and in the context of, the full text of the advice of the IFA to the Independent Directors on the Scheme as set out inAppendix 2 of this Scheme Document. | ||||
Independent Directors’ Recommendation to Shareholders | Subject to the qualifications and bases set out inParagraph 16 of the Company’s Letter to Shareholders, the Independent Directors consider, from a financial point of view, the terms of the Scheme to be fair and reasonable. The Independent Directors therefore unanimously recommend that, in the absence of a superior offer, Shareholdersvote in favour of the Scheme at the Court Meeting. | |||
No Third Party Proposals | No alternative offers for the Company Shares from any third party have been received by the Company, as at the Latest Practicable Date. |
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Company Registration Number: 198703584K
Directors: James A. Norling (Chairman) Chia Song Hwee (President and CEO) Philip Tan Yuen Fah (Chairman of the Audit Committee) Peter Seah Lim Huat (Chairman of the ERCC) Charles E. Thompson Tay Siew Choon Pasquale Pistorio Steven H. Hamblin Maurizio Ghirga | Registered Office: 60 Woodlands Industrial Park D Street 2 Singapore 738406 |
1. | INTRODUCTION |
1.1 | Acquisition. On 7 September 2009, the respective boards of directors of the Company and the Acquiror jointly announced that the Company and the Acquiror had entered into the Implementation Agreement to effect the Acquisition by way of the Scheme. The Acquiror is a company incorporated in Abu Dhabi and wholly-owned by ATIC. ATIC is a technology investment company wholly-owned by the Government of Abu Dhabi. |
1.2 | Delisting, Termination of ADS Deposit Agreement and Deregistration with the SEC. Upon the Scheme becoming effective and binding, the Company will become a wholly-owned subsidiary of the Acquiror, and, (i) subject to the approval of the SGX-ST, the Company will be delisted from the Official List of the SGX-ST and (ii) subject to the filing of a notification with the SEC and prior written notification to Nasdaq, the ADSs will be delisted from Nasdaq. An application has been made to seek confirmation from the SGX-ST to delist the Company from the Official List of the SGX-ST upon the Scheme becoming effective and binding. The Company also intends to deregister the Company Shares and ADSs with the SEC and terminate its reporting obligations under the Exchange Act. Notice is hereby given that, conditional upon the Scheme becoming effective, the ADS Deposit Agreement will be terminated as at the Effective Date. |
The SGX-ST has advised that subject to the effectiveness of the Scheme and the completion of the Acquisition, it has no objection to the delisting of the Company from the Official List of the SGX-ST. The SGX-ST’s confirmation, however, is not an indication of the merits of the delisting of the Company from the Official List of the SGX-ST. | ||
SHAREHOLDERS AND ADS HOLDERS SHOULD NOTE THAT BY VOTING IN FAVOUR OF THE SCHEME OR INSTRUCTING THE ADS DEPOSITARY TO VOTE IN FAVOUR OF THE |
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SCHEME, RESPECTIVELY, THE COMPANY WILL BE DELISTED FROM THE SGX-ST AND THE ADSs WILL BE DELISTED FROM NASDAQ IF THE SCHEME BECOMES EFFECTIVE IN ACCORDANCE WITH ITS TERMS. FURTHERMORE, IN SUCH EVENT, THE COMPANY INTENDS TO DEREGISTER THE COMPANY SHARES AND ADSs WITH THE SEC AND TERMINATE ITS REPORTING OBLIGATIONS UNDER THE EXCHANGE ACT. NOTICE IS HEREBY GIVEN THAT, CONDITIONAL UPON THE SCHEME BECOMING EFFECTIVE, THE ADS DEPOSIT AGREEMENT WILL BE TERMINATED AS AT THE EFFECTIVE DATE. |
1.3 | Purpose. The purpose of this Scheme Document is to set out information pertaining to the Scheme, to seek your approval of the Scheme and to give you notice of the Court Meeting. |
1.4 | Explanatory Statement. An Explanatory Statement setting out the key terms of, the rationale of, and the effects of the Scheme, the material interests of the Directors and the procedures for the implementation of the Scheme is set out on pages 51 to 67 of this Scheme Document. It should be read in conjunction with the full text of this Scheme Document. |
1.5 | Third Party Proposals. From the Announcement Date up to the Latest Practicable Date, no alternative offers for the Company Shares from any third party have been received by the Company. |
2. | THE SCHEME |
2.1 | Terms. |
2.1.1 | The Acquisition will be effected by way of the Scheme and in accordance with the Code. | |
2.1.2 | Under the Scheme: |
(i) | all the Scheme Shares held by Entitled Shareholders will be transferred to the Acquiror: |
(a) | fully paid; | |
(b) | free from all Encumbrances; and | |
(c) | together with all rights, benefits and entitlements as at the Announcement Date and thereafter attaching thereto, including the right to receive and retain all dividends, rights and other distributions (if any) which may be announced, declared, paid or made by the Company on or after the Announcement Date; and |
(ii) | in consideration for such transfer, and upon and subject to the Scheme becoming effective, each Entitled Shareholder will be entitled to receive from the Acquiror the Scheme Consideration, beingS$2.68 in cash for each Scheme Share, provided that if any dividend or distribution with respect to the Company Shares is declared or announced on or after the Announcement Date, and such dividend or distribution is paid or made to holders of the Company Shares of record as at any date that is on or prior to the Effective Date, the Scheme Consideration shall be reduced by the amount of such dividend or distribution. |
2.1.3 | ADS Holders will be entitled to receive their consideration from the ADS Depositary in accordance with the terms of the ADS Deposit Agreement. Based on the prevailing |
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exchange rate from Bloomberg L.P. on the Latest Practicable Date, of S$1.4138 to US$1, the equivalent amount of consideration for each ADS is approximately US$18.96, less the applicable ADS Depositary’s fees, taxes and expenses. The actual amount per ADS that ADS Holders will receive will depend on the applicable prevailing exchange rate at the time of conversion by the ADS Depositary of the Scheme Consideration from Singapore Dollars to United States Dollars and the amount of applicable ADS Depositary’s fees, taxes and expenses. |
2.2 | Scheme Consideration. The Scheme Consideration was arrived at after arm’s length negotiations between the Company and the Acquiror, on a willing-seller, willing-buyer basis, after taking into consideration, amongst other things, the recent market price of the Company Shares. |
2.3 | Scheme Shares. The Scheme will be extended, on the same terms and conditions to: |
2.3.1 | all Company Shares, including Company Shares represented by ADSs; and | |
2.3.2 | all new Company Shares unconditionally issued or to be issued on or before the Books Closure Date pursuant to (i) the valid exercise of any Options, (ii) the vesting of any awards under the RSU Plan, (iii) the vesting of any awards under the PSU Plan, (iv) the valid conversion of any CRPS into new Company Shares and (v) the valid exercise by GS of the GS Option. |
2.4 | Waiver of Rights to a General Offer. Shareholders and ADS Holders should note that by voting in favour of the Scheme or instructing the ADS Depositary to vote in favour of the Scheme, respectively, they are agreeing to the Acquiror and the parties acting in concert with it acquiring effective control of the Company without having to make a general offer for the Company. |
2.5 | No Cash Outlay. Shareholders should note that no cash outlay (including any stamp duties or brokerage expenses) will be required from Shareholders under the Scheme. |
3. | PRINCIPAL TERMS OF THE IMPLEMENTATION AGREEMENT |
3.1 | Scheme Conditions. The Scheme is conditional upon the satisfaction (or, where applicable, waiver) of the Scheme Conditions by not later than 5:00 p.m. on (i) 8 March 2010 or (ii) if Cash is to be tested as at the 4th Test Date (pursuant to, and as such terms are defined inParagraph (m) ofAppendix 5 of this Scheme Document), 11 March 2010, in each case, as may be extended as described inparagraph 3.5.4 of this Letter to Shareholders or such other date as the Parties may agree. |
3.2 | Non-Satisfaction of Scheme Conditions. The Scheme will only become effective and binding if all the Scheme Conditions have been satisfied (or, where applicable, waived) and provided neither the Company nor the Acquiror exercises its Termination Right (if any). Shareholders should note that if any of the Scheme Conditions are not satisfied (or, where applicable, waived) or if the |
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Scheme has not become effective on or before 5:00 p.m. on the Long-Stop Date or such other date as the Parties may agree, either the Company or the Acquiror, as the case may be, may terminate the Implementation Agreement (save for the surviving provisions) by notice in writing to the other Party. |
3.2.1 | Acquiror’s Benefit: The Acquiror alone may waive the Scheme Conditions inParagraphs (b)(ii),(h)(i),(j),(l),(m) and(n) ofAppendix 5 of this Scheme Document. Any breach or non-fulfilment of any such Scheme Conditions may be relied upon only by the Acquiror. The Acquiror may at any time and from time to time at its sole and absolute discretion waive any such breach or non-fulfilment. | |
3.2.2 | The Company’s Benefit: The Company alone may waive the Scheme Conditions inParagraphs (b)(i),(h)(ii), and(k) ofAppendix 5 of this Scheme Document. Any breach or non-fulfilment of any such Scheme Conditions may be relied upon only by the Company. The Company may at any time and from time to time at its sole and absolute discretion waive any such breach or non-fulfilment. | |
3.2.3 | Mutual Benefit: The Parties together may jointly waive the Scheme Conditions inParagraphs (f) and(g) ofAppendix 5 of this Scheme Document (each, to the extent legally permissible) andParagraph (i) ofAppendix 5 of this Scheme Document (but only to the extent that both Parties are not in default, otherwise the Scheme Condition inParagraph (i) ofAppendix 5 of this Scheme Document shall be for the benefit of the Party not in default). | |
3.2.4 | Other Conditions: For the avoidance of doubt, the Parties agree that the Scheme Conditions inParagraphs (a),(c),(d) and(e) ofAppendix 5 of this Scheme Document are not capable of being waived by either or both Parties. |
3.3 | Termination Right. The Implementation Agreement may be terminated by either Party at any time on or prior to the Record Date (provided that the Party seeking termination does so only after it has had prior consultation with the SIC), and on the following grounds (each, a “Termination Right”): |
3.3.1 | Mutual Consent: by the mutual written consent of the Parties; | |
3.3.2 | Court Order: by either Party, if any court of competent jurisdiction or Governmental Authority has issued an injunction, order, decree or ruling or taken any other action permanently enjoining, restraining or otherwise prohibiting or preventing the consummation of the Acquisition or the implementation of the Scheme (or the proposed transactions relating to the Scheme), and such order, decree, ruling, other action or refusal shall have become final and non-appealable; | |
3.3.3 | Breach: either: |
(i) | by the Acquiror, if the Company is in material breach of any provision of the Implementation Agreement (other than a provision which is qualified by a materiality test, in which case any breach shall suffice) or has failed to perform and comply in all material respects with any Scheme Conditions which are expressed to be for the benefit of the Acquiror, and has failed to cure such breach after reasonable notice of such breach (specifying, to the extent reasonably practicable, the nature and circumstances of the breach) has been given, on or prior to the Record Date; or |
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(ii) | by the Company, if the Acquiror is in material breach of any provision of the Implementation Agreement (other than a provision which is qualified by a materiality test, in which case any breach shall suffice) or has failed to perform and comply in all material respects with any Scheme Conditions which are expressed to be for the benefit of the Company and has failed to cure such breach after reasonable notice of such breach (specifying, to the extent reasonably practicable, the nature and circumstances of the breach) has been given, on or prior to the Record Date, |
3.3.4 | Shareholders’ Approvals: by either Party, if the resolutions submitted to the Court Meeting are not approved (without amendment) by the requisite majorities of Shareholders; | |
3.3.5 | Competing Offer: by either Party, if a Competing Offer under Rule 14 or 15 of the Code becomes or is declared unconditional in all respects or becomes effective, as the case may be; or | |
3.3.6 | SIC Competitive Procedure: by either Party, in the event that, following the conclusion of the SIC Competitive Procedure, the latest bid submitted by the Acquiror pursuant to such SIC Competitive Procedure is lower than the latest bid submitted by other competing offeror(s) pursuant to the SIC Competitive Procedure. |
3.4 | Consultation with the SIC. Any Party seeking to terminate the Implementation Agreement by exercising the Termination Right or invoking the non-satisfaction of any of the Scheme Conditions as set out inParagraphs (b) and(f) to(n) ofAppendix 5 of this Scheme Document to terminate the Implementation Agreement must first consult with the SIC and obtain the SIC’s approval of, or a statement that the SIC has no objections to, such termination. |
3.5 | Matching Right for Superior Offer. |
3.5.1 | Matching Right and Matching Right Notification: The Parties have agreed that in the event that the Independent Directors, in the exercise of their fiduciary obligations, decide to recommend or announce their intention to recommend a Competing Offer which they determine in good faith and in their sole discretion, following receipt of advice from their financial and legal advisers, to be superior to the terms offered by the Acquiror (the “Superior Offer”), the Company will promptly (and in any event, prior to the recommendation of or announcement of intention to recommend the Superior Offer) notify the Acquiror of such determination (the “Matching Right Notification”), and give the Acquiror the right at its discretion to match the Superior Offer (the “Matching Right”). | |
3.5.2 | Matching Right Period: From the date of the Matching Right Notification, the Acquiror is entitled to match the Superior Offer during the applicable period set out below (the “Matching Right Period”): |
(i) | in the event the Switch Option is not or has not been validly exercised, (a) for a period as specified in the Matching Right Notification of not less than 10 Business |
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Days in Abu Dhabi (in relation to the first exercise by the Acquiror of the Matching Right), and (b) for a period as specified in the Matching Right Notification of not less than three Business Days in Abu Dhabi (in relation to any subsequent exercise by the Acquiror of the Matching Right); or |
(ii) | in the event the Switch Option is or has been validly exercised, for (a) a period of not less than three Business Days in Abu Dhabi; or (b) for such lesser period as is necessary to enable the Company to comply with its obligations under Rule 22.2 of the Code. |
3.5.3 | Matching Offer Determination: In the event that the Acquiror exercises the Matching Right, the Independent Directors shall determine, in good faith and in their sole discretion, following receipt of advice of their financial and legal advisers, whether the Acquiror has matched the Superior Offer, and shall notify the Acquiror of such determination in writing (the “Matching Offer Determination”). |
3.5.4 | Delay, Postponement or Adjournment: In the event the Scheme Document has not been despatched prior to the commencement of the applicable Matching Right Period or the establishment of the SIC Competitive Procedure, as the case may be, the Company shall be entitled to delay or postpone such despatch, until after (i) the expiration of the applicable Matching Right Period, if the Matching Right is not validly exercised, or the Independent Directors having delivered to the Acquiror the Matching Offer Determination, if the Matching Right is validly exercised or (ii) the completion of the SIC Competitive Procedure, as the case may be. |
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3.6 | Switch Option. |
3.6.1 | Switch Option: Subject to prior consultation with the SIC, the Acquiror shall have the right at its discretion to elect to proceed by way of an Offer in lieu of proceeding with the Acquisition by way of the Scheme (the “Switch Option”), if: |
(i) | any person (other than the Acquiror or any of the parties acting in concert with it) publicly announces a Superior Offer (whether on a firm intention or a pre-conditional basis) for no less than 30 per cent. of the voting rights of the Company; | |
(ii) | the Acquiror validly exercises the Matching Right, and receives or is deemed to have received the Matching Offer Determination stating that it has matched the Superior Offer; and | |
(iii) | the Acquiror duly announces its firm intention to make the Offer. |
3.6.2 | Terms of the Offer: If the Acquiror validly exercises the Switch Option, the Acquiror shall make the Offer on the same or better terms as those set out in the Acquiror’s proposal to the Company when exercising the Matching Right. The acceptance condition of such Offer may be set at only more than 50 per cent. of the Company Shares (including Company Shares held in the form of ADSs), and not conditional on higher level acceptances. | |
3.6.3 | Termination of Implementation Agreement: If the Acquiror validly exercises the Switch Option, the Implementation Agreement shall terminate with effect from the date of announcement by the Acquiror of its firm intention to make the Offer, save for certain surviving provisions and the provisions relating to the Matching Right and to non-solicitation, as described inParagraphs 3.5 and3.7 of this Letter to Shareholders, respectively. |
3.7 | Non-Solicitation. |
3.7.1 | No-Shop: During the No-Shop Period, the Company shall,inter alia, (i) deal exclusively with the Acquiror to complete the Scheme and (ii) not, and shall not permit any of its Group Companies or their respective employees, officers and advisers to (whether directly or indirectly) solicit, encourage, initiate or participate in any offer, proposal, expression of interest or make any initial or further approach to any person, or entertain any approach from or enter into or continue negotiations or discussions with any person (other than the Acquiror or any of the parties acting in concert with it), or communicate any intention to do any of these things, with respect to any Competing Offer, provided that such restriction shall not apply to the making of normal presentations by or on behalf of the Company, to brokers, investors or analysts in the ordinary and usual course of the Company’s business generally, and shall not restrict the provision of information by or on behalf of the Company to the SGX-ST or SEC via a report onForm 6-K. | |
3.7.2 | Unsolicited Offer: Neither the Company nor the Company Directors are prohibited or restricted, during the No-Shop Period, from receiving abona fide unsolicited or uninitiated offer or proposal with respect to any Competing Offer (an “Unsolicited Offer”). In the event that any of the Company, the Group Companies, or their respective directors, employees, officers or advisers receives any Unsolicited Offer, the Companyand/or the |
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Company Directors shall be entitled, subject to the obligations described inParagraph 3.5 of this Letter to Shareholders, to,inter alia: |
(i) | announce such Unsolicited Offer, insofar as such announcement is required under the Listing Manual, the Code, the Nasdaq Listing Rules or any Applicable Laws; | |
(ii) | comply with Rule 9.2 of the Code; | |
(iii) | enter into negotiations, discussions or otherwise entertain such Unsolicited Offer if necessary for the Company Directors to comply with and discharge their fiduciary duties to the Company and the Shareholders; and | |
(iv) | in the exercise of the fiduciary duties of the Company Directors, make or refrain from making any recommendation to the Shareholders as the Company Directors may deem fit in respect of the Unsolicited Offer. |
3.7.3 | Notice: During the No-Shop Period, if the Company (i) is informed of or otherwise becomes aware of (a) an Unsolicited Offer, (b) any approach, solicitation or attempt to initiate any negotiations, correspondence or discussions, or (c) any other proposal that the Company reasonably believes could lead to a Competing Offer or (ii) enters into any discussions relating to the same, the Company will notify the Acquiror immediately in writing. Unless the Company is subject to a binding confidentiality agreement in effect prior to the date of the exclusivity agreement entered into with ATIC, the Company will disclose to the Acquiror all material terms of such proposal including the identity of the other parties and any price or price range. If the Company is bound by a confidentiality agreement, the Company will disclose to the Acquiror only information that the Company is permitted to disclose under such confidentiality agreement. |
3.8 | Certain Restrictions. |
3.8.1 | During the First Restricted Period, the Acquiror shall not, and shall procure that the Acquiror Affiliates and the Restricted Affiliates shall not, unless pursuant to the terms of the Implementation Agreement or with the Company’s prior written consent: |
(i) | acquire any Company Shares or Company Convertible Securities, whether or not such Company Convertible Securities may be settled in cash or otherwise and whether at the discretion of the Acquiror or any of the Acquiror Affiliates or the Restricted Affiliates; | |
(ii) | make an offer for the Company Shares or Company Convertible Securities or announce or take any action which would require the announcement of any similar transaction involving the Company Shares or the Company Convertible Securities; or | |
(iii) | enter into any agreement, arrangement or understanding (whether conditionally, and whether legally binding or not) with any person in relation to any of the foregoing, or assist, advise or encourage any person to achieve any of the foregoing, |
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(a) | any CRPS or any Company Shares or Company Convertible Securities after the Switch Option is validly exercised; or | |
(b) | any Company Shares in aggregate representing less than 10 per cent. of the voting rights of the Company from time to time subject to compliance with the provisions described inParagraph 3.8.2 of this Letter to Shareholders; and |
3.8.2 | during the First Restricted Period and during the Second Restricted Period, the Acquiror shall and shall procure that each of the Acquiror Affiliates (and each of the Restricted Affiliates for so long as such Restricted Affiliate is a party acting in concert with the Acquiror Affiliates) shall: |
(i) | in respect of all and not some only of the Company Shares held by it, vote in favour of any resolution (including an ordinary, a special or a scheme resolution) of the Company which is recommended by a majority of the Company Directors and shall not otherwise vote any such Company Shares; | |
(ii) | in respect of all and not some only of the Company Shares held by it, accept any tender offer, general offer or partial offer which is recommended by a majority of the Company Directors; | |
(iii) | not convene, requisition or join in requisitioning, any general meeting of the Company; | |
(iv) | not propose any nominee for appointment to the Board (whether by way of an ordinary resolution or otherwise); | |
(v) | not seek to control or influence the business strategy or management of the business of the Group; or | |
(vi) | not enter into any agreement, arrangement or understanding (conditionally or otherwise and whether legally binding or not) with any person in relation to the foregoing or assist, advise or encourage any person to achieve any of the foregoing. |
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3.9 | Fee. The Company shall pay the Acquiror a sum equal to S$25,375,176.64 (the “Fee”) in the following events, provided that the Company shall not be obliged to pay any amount which the SIC determines would not be permitted by Rule 13 of the Code: |
3.9.1 | Recommendation of Competing Offer: if a Competing Offer or an intention to make a Competing Offer is announced by a third party (whether or not such Competing Offer is pre-conditional), and: |
(i) | the Independent Directors recommend or announce their intention to recommend such Competing Offer over the Scheme or do not unequivocally recommend that Shareholders vote in favour of the Scheme; or | |
(ii) | in the event that prior to the announcement of the Competing Offer or the intention to make a Competing Offer, the Independent Directors, having recommended that Shareholders vote in favour of the Scheme, withdraw such recommendation or announce their intention to withdraw such recommendation and subsequently, recommend or announce their intention to recommend such Competing Offer or do not unequivocally recommend that Shareholders vote in favour of the Scheme, |
3.9.2 | Breach of Material Obligations: if the Company breaches any of its Material Obligations: |
(i) | prior to the date of the Court Meeting, and Shareholders’ approval of the Scheme is not obtained; or | |
(ii) | after Shareholders’ approval of the Scheme is obtained and the Scheme does not become effective by the Long-Stop Date or such other date as the Parties may agree, due to any of the Scheme Conditions inParagraphs (d) and(e) ofAppendix 5 of this Scheme Document not being fulfilled other than as a result of the Company exercising its right to terminate the Implementation Agreement on the grounds described inParagraph 3.3.3(ii) of this Letter to Shareholders; or |
3.9.3 | Entertainment of Unsolicited Offer: if the Company exercises its right to enter into negotiations or discussions or otherwise entertains an Unsolicited Offer if necessary for the Company Directors to comply with and discharge their fiduciary duties, and Shareholders’ approval of the Scheme is not obtained. |
3.10 | Acceleration of RSUs and PSUs. Pursuant to the terms of the Implementation Agreement, the Company shall accelerate all outstanding RSUs and PSUs granted under the RSU Plan and the PSU Plan, respectively, as at the Announcement Date, on and subject to the effectiveness of the Scheme or if the Switch Option is exercised, on the Offer becoming or being declared unconditional in all respects. The Acquiror has undertaken to pay the Company a sum in cash equal to the Scheme Consideration multiplied by the aggregate number of Company Shares comprised in such accelerated RSUs and PSUs (collectively, the “Accelerated Amount”) (less |
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any applicable withholding tax amount) not later than five Business Days prior to the dates on which such payments are due to the grantees as described below provided that: |
3.10.1 | the aggregate number of Company Shares comprised in the accelerated RSUs under the RSU Plan shall not exceed 3,791,945; and | |
3.10.2 | the aggregate number of Company Shares comprised in the accelerated PSUs under the PSU Plan shall not exceed 979,754. |
4. | THE PREFERENCE SHARE OFFER |
5. | THE GS OPTION |
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6. | IRREVOCABLE UNDERTAKINGS |
6.1 | STS Irrevocable Undertaking. STS, which holds 586,752,688 Company Shares as at the Latest Practicable Date, representing approximately 62.28 per cent. of all the Company Shares, has entered into the STS Irrevocable Undertaking, pursuant to which it has given an irrevocable undertaking to the Acquiror to,inter alia: |
6.1.1 | Vote in Favour of the Scheme at the Court Meeting: vote or procure the voting of all its Company Shares (i) in favour of the Scheme at the Court Meeting and (ii) against any resolution or proposal to adjourn the Court Meeting, except in the event the Company seeks an adjournment of the Court Meeting for any reason described inParagraph 3.5.4 of this Letter to Shareholders or with the prior written consent of the Acquiror; | |
6.1.2 | Accept the Offer: in the event the Acquiror validly exercises the Switch Option, (i) accept the Offer in respect of all its Company Shares not later than five business days after the despatch by or on behalf of the Acquiror of the formal document in relation to the Offer and (ii) not withdraw its acceptance of the Offer, without the prior written consent of the Acquiror; and |
6.1.3 | Vote in Favour of Special Resolution (1) and Special Resolution (2) at the EGM: to the extent permitted by applicable laws, vote or procure the voting of all its Company Shares (i) in favour of Special Resolution (1) and Special Resolution (2) at the EGM, and (ii) against any resolution or proposal to adjourn the EGM, except in the event the Company seeks an adjournment of the EGM where the Company seeks an adjournment of the Court Meeting for any reason described inParagraph 3.5.4 of this Letter to Shareholders or with the prior written consent of the Acquiror. |
6.2 | Management Executive Irrevocable Undertakings. Each of Chia Song Hwee (President and CEO of the Company) and George Thomas (the Chief Financial Officer of the Company) has entered into the Management Executive Irrevocable Undertaking pursuant to which each of them has given an irrevocable undertaking to the Acquiror on terms substantially similar to the STS Irrevocable Undertaking. |
6.3 | Termination. The Irrevocable Undertakings will each terminate on the earliest of the following dates: |
6.3.1 | the Long-Stop Date, or such other date as the Acquiror and the party giving the relevant Irrevocable Undertaking may agree in writing, if the Scheme lapses, is withdrawn or does not become effective by such time for any reason other than a breach by such party of its obligations under the relevant Irrevocable Undertaking; |
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6.3.2 | the date an Offer is made, in the event the Acquiror makes such Offer in lieu of proceeding with the Scheme and such Offer is not made in compliance with the valid exercise of the Switch Option; | |
6.3.3 | the date the Scheme lapses, is withdrawn or does not become effective for any reason other than a breach by the party giving the relevant Irrevocable Undertaking of its obligations under the relevant Irrevocable Undertaking; and | |
6.3.4 | the date the Scheme becomes effective in accordance with its terms, |
6.4 | No Other Irrevocable Undertakings. Save for the Irrevocable Undertakings, the Company understands from the Acquiror that none of the Acquiror, ATIC and any party acting in concert with them has received any other irrevocable undertakings from any other party to vote in favour of, or reject, the Scheme as at the Latest Practicable Date. |
7. | INFORMATION ON THE COMPANY |
8. | INFORMATION ON THE ACQUIROR AND ATIC |
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9. | RATIONALE AND BENEFITS OF THE ACQUISITION AND FUTURE PLANS FOR THE GROUP |
9.1 | Rationale and Benefits of the Acquisition. The Acquiror’s rationale and benefits of the Acquisition are set out inParagraph 4.1 of the Letter from the Acquiror to Shareholders inAppendix 3 of this Scheme Document and are reproduced in italics below: |
9.2 | Future Plans for the Group. The Acquiror’s future plans for the Group are set out inParagraph 4.2 of the Letter from the Acquiror to Shareholders inAppendix 3 of this Scheme Document and are reproduced in italics below: |
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10. | FINANCIAL EVALUATION OF THE SCHEME CONSIDERATION |
10.1 | Scheme Consideration. The Scheme Consideration represents a premium/(discount) over the recent market prices of the Company Shares and the ADSs. Specifically, the Scheme Consideration represents the following premium/(discounts): |
Premium/ | ||||||||||||||||||
Benchmark | Premium/ | (Discount to) | ||||||||||||||||
price of the | (Discount to) the | the | ||||||||||||||||
Company | benchmark price | Benchmark price | benchmark | |||||||||||||||
Shares on the | of the Company | of the ADSs on | price of the | |||||||||||||||
SGX-ST(1) | Shares on the | Nasdaq(1)(2) | ADSs on | |||||||||||||||
(S$) | SGX-ST (%) | (US$) | Nasdaq (%) | |||||||||||||||
(i) | Last transacted price as quoted on 28 May 2009(3) | 2.18 | 22.9 | 14.81 | 25.9 | |||||||||||||
(ii) | Last transacted price as quoted on 4 September 2009, being the latest practicable date prior to the Announcement Date | 2.66 | 0.8 | 18.78 | (0.7 | ) | ||||||||||||
(iii) | VWAP for the period of five trading days up to the latest practicable date prior to the Announcement Date | 2.53 | 5.9 | 17.57 | 6.1 | |||||||||||||
(iv) | VWAP for the period of 30 trading days up to the latest practicable date prior to the Announcement Date | 2.35 | 14.2 | 16.19 | 15.2 | |||||||||||||
(v) | VWAP for the period of 90 trading days up to the latest practicable date prior to the Announcement Date | 2.11 | 26.8 | 14.50 | 28.5 | |||||||||||||
(vi) | VWAP for the period of six months up to the latest practicable date prior to the Announcement Date | 1.86 | 44.2 | 11.94 | 56.1 |
(1) | The figures set out in thisParagraph 10.1 are based on data extracted from Bloomberg L.P. and are adjusted (where applicable, retroactively) for the Company’s27-for-10 rights offering completed on 15 April 2009 and10-for-1 share consolidation effective on 21 May 2009. | |
(2) | One ADS represents the right to receive 10 Company Shares on deposit with the ADS Custodian Bank. | |
(3) | On 29 May 2009, the Singapore Business Times reported on a possible acquisition by ATIC of the Company Shares held by STS which was followed by a holding announcement by the Company on the same day. 28 May 2009 is therefore the trading day immediately prior to the commencement of market speculation. |
11. | APPROVALS REQUIRED |
11.1 | Approvals. The Scheme will require,inter alia, the following approvals: |
11.1.1 | the approval of the Scheme by a majority in number of, and representing not less than 75 per cent. in value of the Company Shares held by, Shareholders present and voting, either in person or by proxy, at the Court Meeting; and | |
11.1.2 | the approval of the Scheme by the Court. |
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11.2 | Exemptions. In relation to the Code, the SIC has confirmed that the Scheme is exempted from Rules 14, 15, 16, 17, 20.1, 21, 22, 28, 29 and 33.2 and Note 1(b) on Rule 19 of the Code, subject to the following conditions: |
11.2.1 | the common substantial shareholders of the Company and the Acquiror abstain from voting on the Scheme; | |
11.2.2 | the Acquiror and parties acting in concert with it abstain from voting on the Scheme; | |
11.2.3 | the Company Directors who are also Acquiror Directors abstain from making a recommendation on the Scheme to the Shareholders; and | |
11.2.4 | the Company appoints an independent financial adviser to advise Shareholders on the Scheme. |
12. | DISCLOSURES |
12.1 | Shareholdings and Dealings. Disclosures in relation to shareholdings and dealings in (i) Company Shares or Company Convertible Securities, (ii) Acquiror Shares or Acquiror Convertible Securities, and (iii) ATIC Shares or ATIC Convertible Securities, are set out inAppendix 4 of this Scheme Document. |
12.2 | Further Disclosures. Appendix 4 of this Scheme Document sets out certain additional information relating to the Company. |
13. | OVERSEAS SHAREHOLDERS |
13.1 | Overseas Shareholders. The applicability of the Scheme to Overseas Shareholders may be affected by the laws of the relevant overseas jurisdictions. Accordingly, Overseas Shareholders should keep themselves informed of and observe any applicable legal requirements. This Scheme Document will be sent to all Overseas Shareholders unless, due to restrictions or potential restrictions on sending such documents into the relevant overseas jurisdictions, this Scheme Document may not be sent to any Overseas Shareholder in such jurisdictions. For the avoidance of doubt, the Scheme is proposed to all Shareholders and applies to all the Scheme Shares, including those to whom this Scheme Document may not be and will not be sent. |
13.2 | Foreign Jurisdiction. It is the responsibility of any Overseas Shareholder who wishes to (i) request for this Scheme Documentand/or any related documents or (ii) vote on or |
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participate in the Scheme, to satisfy itself/himself as to the full observance of the laws of the relevant jurisdiction in that connection, including the obtaining of any governmental or other consent which may be required, and compliance with all necessary formalities or legal requirements. |
13.3 | Notice. The Company and the Acquiror each reserves the right to notify Shareholders of any matter, including the fact that the Scheme has been proposed, to any or all Shareholders with a registered address outside Singapore and the United States by an announcement to the SGX-ST or paid advertisement in a daily newspaper published and circulated in Singapore, and in each case, submitted to the SEC via a report onForm 6-K, in which case such notice shall be deemed to have been sufficiently given notwithstanding any failure by any Shareholder to receive or see such announcement or advertisement. For the avoidance of doubt, for as long as the Company remains listed on the SGX-ST, it will continue to notify all Shareholders of any matter relating to the Scheme by announcement to the SGXNET, and for so long as the Company remains a reporting company in the United States, it will submit to the SEC material matters relating to the Scheme via a report onForm 6-K. |
14. | CONFIRMATION OF FINANCIAL RESOURCES |
15. | FINANCIAL ADVISERS TO THE BOARD |
15.1 | Joint Financial Advisers to the Board: Morgan Stanley and Citi have been appointed as the FAs to the Board in connection with the Acquisition and the Scheme. |
15.1.1 | Morgan Stanley’s Fairness Opinion. Morgan Stanley has rendered its Fairness Opinion, addressed solely to the Board, that, as at 7 September 2009, based on the considerations and subject to the qualifications set forth in its Fairness Opinion, the Scheme Consideration to be paid to the holders of Company Shares (including Company Shares held in the form of ADSs) pursuant to the Implementation Agreement was fair from a financial point of view to such holders. A copy of the Fairness Opinion issued by Morgan Stanley is reproduced inAppendix 1A of this Scheme Document. The Fairness |
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Opinion issued by Morgan Stanley does not constitute independent advice for the purposes of Rule 7.1 of the Code. |
15.1.2 | Citi’s Fairness Opinion. Citi has rendered its Fairness Opinion, addressed solely to the Board, that, as at 7 September 2009, based upon the considerations and subject to the qualifications set forth in its Fairness Opinion, the Scheme Consideration to be paid to the Shareholders and the amount of consideration to be paid to the ADS Holders pursuant to the Implementation Agreement was fair from a financial point of view to such holders of Company Shares and ADSs (in each case, other than STS). A copy of the Fairness Opinion issued by Citi is reproduced inAppendix 1B of this Scheme Document. The Fairness Opinion issued by Citi does not constitute independent advice for the purposes of Rule 7.1 of the Code. |
15.2 | Independent Financial Adviser to the Independent Directors. Deutsche Bank has been appointed as the IFA to advise the Independent Directors for the purpose of making a recommendation to Shareholders in respect of the Scheme and the Preference Share Offer. |
16. | INDEPENDENT DIRECTORS’ RECOMMENDATION |
16.1 | Recommendation. All Directors (except Chia Song Hwee, the President and CEO of the Company, for the reasons set out inParagraph 16.3 of this Letter to Shareholders) consider themselves to be independent for purposes of making a recommendation to Shareholders in respect of the Scheme. |
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16.2 | No Regard to Specific Objectives. The Independent Directors advise that Shareholders, in deciding whether to vote in favour of the Scheme, carefully consider the full text of the advice of the IFA to the Independent Directors on the Scheme and in particular, the various factors highlighted by the IFA in the IFA’s Letter on the Scheme. |
16.3 | Exemption in Relation to Directors’ Recommendations. Chia Song Hwee has been exempted by the SIC from joining in the recommendations to Shareholders in relation to the Scheme, for the following reasons: |
16.3.1 | he will be receiving the cash payment mentioned inParagraph 11.2 ofAppendix 4 of this Scheme Document; and |
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16.3.2 | the Company is listed on both the SGX-ST and Nasdaq and it is required to comply with both the Code and U.S. securities laws in respect of the Acquisition. Under the Nasdaq rules, Chia Song Hwee does not qualify as an Independent Director because he is the CEO of the Company. Accordingly, U.S. investors would generally not expect Chia Song Hwee to be independent for the purpose of the Scheme. |
17. | DIRECTORS’ INTENTIONS |
18. | GENERAL |
18.1 | Copies of Scheme Document. Shareholders, including Overseas Shareholders, may obtain additional copies of this Scheme Document and any related documents during normal business hours at the registered office of the Company at 60 Woodlands Industrial Park D Street 2 Singapore 738406 on any day prior to the date of the Court Meeting. Alternatively, an Overseas Shareholder may write to the Company at the same address to request for this Scheme Document and any related documents to be sent to an address in Singapore by ordinary post at it/his own risk, not later than 10 Market Days prior to the date of the Court Meeting. |
18.2 | General Information. Your attention is drawn to further relevant information in theAppendices of this Scheme Document. TheseAppendices form part of this Scheme Document. |
19. | EXTRAORDINARY GENERAL MEETING AND CLASS MEETING |
19.1 | EGM and Class Meeting. Pursuant to the terms of the Implementation Agreement, the Company has undertaken to procure that an extraordinary general meeting (the “EGM”) be held immediately upon the conclusion of the Court Meeting (if the resolutions submitted to the Court Meeting are approved by the requisite majorities of Shareholders), for the purposes of passing special resolutions to amend the Articles by incorporating the provisions described inParagraphs 19.2 (“Special Resolution (1)”) and19.3 (“Special Resolution (2)”) of this Letter to Shareholders. Immediately upon conclusion of the EGM, the Company will procure that a meeting of the Preference Share Holders (the “Class Meeting”) be held for the purpose of passing Special Resolution (2). |
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19.2 | Transfer of New Company Shares. If passed at the EGM, Special Resolution (1) would amend the Articles such that: |
19.2.1 | where the Acquisition is to be effected by way of a Scheme, subject to and upon the Scheme becoming effective and binding in accordance with its terms, if any new Company Shares are issued to any person other than any of GLOBALFOUNDRIES, the Acquiror or a subsidiary of any holding company for the time being of the Acquiror (a “New Member”) after: |
(i) | the Voting Record Time and on or prior to the Effective Date; or | |
(ii) | the Effective Date, |
19.2.2 | where the Acquisition is to be effected by way of an Offer, subject to and upon the completion of the Compulsory Acquisition, if any new Company Shares are issued to any New Member after: |
(i) | the Offer Cut-Off Date and on or prior to the Compulsory Acquisition Completion Date; or | |
(ii) | the Compulsory Acquisition Completion Date, |
19.3 | Company’s Right to Treat Conversion as Redemption. If passed at both the EGM and at the Class Meeting, Special Resolution (2) would amend the Articles such that, subject to and upon: |
19.3.1 | where the Acquisition is to be effected by way of a Scheme, the Scheme becoming effective and binding in accordance with its terms; or | |
19.3.2 | where the Acquisition is to be effected by way of an Offer, the completion of the Compulsory Acquisition, |
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19.4 | Effect of Special Resolution (1) and Special Resolution (2). |
19.4.1 | The effect of Special Resolution (1) is that, upon the Scheme becoming effective and binding or the completion of the Compulsory Acquisition, Company Shares which are issued to a New Member will be compulsorily acquired by the Acquiror (as the Acquiror may direct in writing to the Company) at the same consideration as the consideration for which Company Shares are acquired by the Acquiror under the Scheme or the Offer, as the case may be, subject to such adjustments as may be appropriate in the event of asub-division or consolidation of the ordinary share capital of the Company. | |
19.4.2 | The effect of Special Resolution (2) is that, upon the Scheme becoming effective and binding or the completion of the Compulsory Acquisition, if any Preference Share Holder wishes to convert the CRPS held by it into Company Shares, the Company may (but shall not be obliged to) settle such obligation to such Preference Share Holder by paying the Redemption Amount in lieu of issuing such Company Shares. |
19.5 | Preference Share Holders’ Right to Vote at the EGM. Pursuant to Article 4A.11(1)(c) of the Articles, Preference Share Holders may vote at any general meeting of the Company if the resolution in question,inter alia, varies the rights attached to the CRPS or is for the winding up of the Company. As Special Resolution (2) to be voted at the EGM varies the rights attached to the CRPS, the Preference Share Holders are entitled to attend and vote on Special Resolution (2) at the EGM. The Preference Share Holders are not entitled to vote on Special Resolution (1) at the EGM. |
19.6 | Notice of EGM, Notice of Class Meeting and ADS Depositary Notice. Notice of the EGM for the purpose of passing Special Resolution (1) and Special Resolution (2), together with the accompanying Proxy Statement, has been despatched by the Company to Shareholders and Preference Share Holders at the same date as the date of despatch of the Scheme Document. Notice of the Class Meeting for the purpose of passing Special Resolution (2), together with the accompanying Proxy Statement, has been despatched by the Company to Preference Share Holders at the same date as the date of despatch of the Scheme Document. The ADS Depositary Notice, which includes notice of the EGM for the purpose of passing Special Resolution (1) and Special Resolution (2), together with the ADS Voting Instructions Card, will be despatched by the ADS Depositary to ADS Holders on the same date as the date of despatch of the Scheme Document to ADS Holders. |
20. | DIRECTORS’ RESPONSIBILITY STATEMENT |
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1. | INTRODUCTION |
1.1 | Acquisition. On 7 September 2009, the respective boards of the Company and the Acquiror jointly announced that the Company and the Acquiror had entered into the Implementation Agreement to effect the Acquisition by way of the Scheme. The Acquiror is a company incorporated in Abu Dhabi and wholly-owned by ATIC. ATIC is a technology investment company wholly-owned by the Government of Abu Dhabi. |
1.2 | Explanatory Statement. This Explanatory Statement should be read in conjunction with the full text of this Scheme Document, including the Scheme as set out on pages 213 to 219 of this Scheme Document. Capitalised terms used in this Explanatory Statement have the same meaning as those defined on pages 4 to 19 of this Scheme Document unless otherwise indicated. |
2. | THE SCHEME |
2.1 | Terms. |
2.1.1 | Scheme: The Acquisition will be effected by way of the Scheme and in accordance with the Code. | |
2.1.2 | Transfer of Shares: Under the Scheme: |
(i) | all the Scheme Shares held by Entitled Shareholders will be transferred to the Acquiror: |
(a) | fully paid; | |
(b) | free from all Encumbrances; and |
(c) | together with all rights, benefits and entitlements as at the Announcement Date and thereafter attaching thereto, including the right to receive and retain all dividends, rights and other distributions (if any) which may be announced, declared, paid or made by the Company on or after the Announcement Date; and |
(ii) | in consideration for such transfer, and upon and subject to the Scheme becoming effective, each Entitled Shareholder will be entitled to receive from the Acquiror the Scheme Consideration, beingS$2.68 in cash for each Scheme Share, provided that if any dividend or distribution with respect to the Company Shares is declared or announced on or after the Announcement Date, and such dividend or distribution is paid or made to holders of the Company Shares of record as at any date that is on or prior to the Effective Date, the Scheme Consideration shall be reduced by the amount of such dividend or distribution. |
2.1.3 | ADS Holders: ADS Holders will be entitled to receive their consideration from the ADS Depositary in accordance with the terms of the ADS Deposit Agreement. Based on the prevailing exchange rate from Bloomberg L.P. on the Latest Practicable Date, of S$1.4138 to US$1, the equivalent amount of consideration for each ADS is approximately US$18.96, less the applicable ADS Depositary’s fees, taxes and expenses. The actual |
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amount per ADS that ADS Holders will receive will depend on the applicable prevailing exchange rate at the time of conversion by the ADS Depositary of the Scheme Consideration from Singapore Dollars to United States Dollars and the amount of applicable ADS Depositary’s fees, taxes and expenses. |
2.2 | Scheme Consideration. The Scheme Consideration was arrived at after arm’s length negotiations between the Company and the Acquiror, on a willing-seller, willing-buyer basis, after taking into consideration, amongst other things, the recent market price of the Company Shares. |
2.3 | Scheme Shares. The Scheme will be extended, on the same terms and conditions to: |
2.3.1 | all Company Shares, including Company Shares represented by ADSs; and | |
2.3.2 | all new Company Shares unconditionally issued or to be issued on or before the Books Closure Date pursuant to (i) the valid exercise of any Options (ii) the vesting of any awards under the RSU Plan, (iii) the vesting of any awards under the PSU Plan, (iv) the valid conversion of CRPS into new Company Shares and (v) the valid exercise by GS of the GS Option. |
2.4 | Waiver of Rights to a General Offer. Shareholders and ADS Holders should note that by voting in favour of the Scheme or instructing the ADS Depositary to vote in favour of the Scheme, respectively, they are agreeing to the Acquiror and the parties acting in concert with it acquiring effective control of the Company without having to make a general offer for the Company. |
2.5 | No Cash Outlay. Shareholders should note that no cash outlay (including any stamp duties or brokerage expenses) will be required from Shareholders under the Scheme. |
3. | PRINCIPAL TERMS OF THE IMPLEMENTATION AGREEMENT |
4. | THE PREFERENCE SHARE OFFER |
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5. | THE GS OPTION |
6. | IRREVOCABLE UNDERTAKINGS |
6.1 | STS Irrevocable Undertaking. STS, which holds 586,752,688 Company Shares as at the Latest Practicable Date, representing approximately 62.28 per cent. of all the Company Shares, entered into the STS Irrevocable Undertaking, pursuant to which it has given an irrevocable undertaking to the Acquiror to,inter alia: |
6.1.1 | Vote in Favour of the Scheme at the Court Meeting: vote or procure the voting of all its Company Shares (i) in favour of the Scheme at the Court Meeting and (ii) against any resolution or proposal to adjourn the Court Meeting, except in the event the Company seeks an adjournment of the Court Meeting for any reason described inParagraph 3.5.4 of the Company’s Letter to Shareholders or with the prior written consent of the Acquiror; | |
6.1.2 | Accept the Offer: in the event the Acquiror validly exercises the Switch Option, (i) accept the Offer in respect of all its Company Shares not later than five business days after the despatch by or on behalf of the Acquiror of the formal document in relation to the Offer and (ii) not withdraw its acceptance of the Offer, without the prior written consent of the Acquiror; and | |
6.1.3 | Vote in Favour of Special Resolution (1) and Special Resolution (2) at the EGM: to the extent permitted by applicable laws, vote or procure the voting of all its Company Shares (i) in favour of Special Resolution (1) and Special Resolution (2) at the EGM, and (ii) against any resolution or proposal to adjourn the EGM, except in the event the Company seeks an adjournment of the EGM where the Company seeks an adjournment of the Court Meeting for any reason described inParagraph 3.5.4 of the Company’s Letter to Shareholders or with the prior written consent of the Acquiror. |
6.2 | Management Executive Irrevocable Undertakings. Each of Chia Song Hwee (President and CEO of the Company) and George Thomas (the Chief Financial Officer of the Company) has entered into the Management Executive Irrevocable Undertaking pursuant to which each of them has given an irrevocable undertaking to the Acquiror on terms substantially similar to the STS Irrevocable Undertaking. |
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6.3 | Termination. The Irrevocable Undertakings will each terminate on the earliest of the following dates: |
6.3.1 | the Long-Stop Date, or such other date as the Acquiror and the party giving the relevant Irrevocable Undertaking may agree in writing, if the Scheme lapses, is withdrawn or does not become effective by such time for any reason other than a breach by such party of its obligations under the relevant Irrevocable Undertaking; | |
6.3.2 | the date an Offer is made, in the event the Acquiror makes such Offer in lieu of proceeding with the Scheme and such Offer is not made in compliance with the valid exercise of the Switch Option; | |
6.3.3 | the date the Scheme lapses, is withdrawn or does not become effective for any reason other than a breach by the party giving the relevant Irrevocable Undertaking of its obligations under the relevant Irrevocable Undertaking; and | |
6.3.4 | the date the Scheme becomes effective in accordance with its terms, |
6.4 | No Other Irrevocable Undertakings. Save for the Irrevocable Undertakings, the Company understands from the Acquiror that none of the Acquiror, ATIC and any party acting in concert with them has received any other irrevocable undertakings from any other party to vote in favour of, or reject, the Scheme as at the Latest Practicable Date. |
7. | INFORMATION ON THE COMPANY |
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8. | INFORMATION ON THE ACQUIROR AND ATIC |
9. | RATIONALE AND BENEFITS OF THE ACQUISITION AND FUTURE PLANS FOR THE GROUP |
10. | COURT MEETING |
10.1 | Court Meeting. The Scheme, which is proposed pursuant to Section 210 of the Companies Act, has to be approved at the Court Meeting by a majority in number of, and representing not less than 75 per cent. in value of the Company Shares held by, Shareholders present and voting, either in person or by proxy, at the Court Meeting. Voting at the Court Meeting will be by way of poll. |
10.2 | ADS Holders. ADS Holders will not be entitled to attend or vote at the Court Meeting. However, ADS Holders may instruct the ADS Depositary to exercise the voting rights for the Company Shares represented by their ADSs. Pursuant to the ADS Deposit Agreement, voting instructions may be given only in respect of a number of ADSs representing an integral number of Company Shares. The ADS Depositary shall endeavour, insofar as reasonably practicable and permitted under applicable law, the provisions of the Articles and the provisions of the ADS Deposit Agreement, to vote or cause the ADS Custodian Bank to vote the Company Shares (in person or in proxy) represented by such ADS Holder’s ADSs in accordance with the ADS Holder’s instructions. |
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10.3 | Notice. The notice of the Court Meeting is set out on pages 220 to 221 of this Scheme Document. You are requested to take note of the date and time of the Court Meeting. |
11. | REGULATORY APPROVALS |
11.1 | SIC. |
11.1.1 | Code: The SIC has confirmed that the Scheme is exempted from Rules 14, 15, 16, 17, 20.1, 21, 22, 28, 29 and 33.2 and Note 1(b) on Rule 19 of the Code, subject to the following conditions: |
(i) | the common substantial shareholders of the Company and the Acquiror abstain from voting on the Scheme; | |
(ii) | the Acquiror and parties acting in concert with it abstain from voting on the Scheme; | |
(iii) | the Company Directors who are also Acquiror Directors abstain from making a recommendation on the Scheme to the Shareholders; and |
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(iv) | the Company appoints an independent financial adviser to advise Shareholders on the Scheme. |
(a) | the Company understands that there are no common substantial shareholders of the Company and the Acquiror; | |
(b) | the Company understands that the Acquiror and the parties acting in concert with it(1) do not hold any voting rights in the Company and as such will not vote on the Scheme; and |
(c) | there are no Company Directors who are also Acquiror Directors or who are acting in concert with the Acquiror. |
11.2 | Scheme Conditions. The SIC has confirmed that it has no objections to the Scheme Conditions. However, any Party seeking to terminate the Implementation Agreement by exercising its Termination Right must first consult with the SIC and obtain the SIC’s approval of, or a statement that the SIC has no objections to, such termination. |
12. | EFFECT OF THE SCHEME |
12.1 | Effect of the Scheme. Upon the Scheme becoming effective and binding, the Company will become a wholly-owned subsidiary of the Acquiror, and (i) subject to the approval of the SGX-ST, the Company will be delisted from the Official List of the SGX-ST and (ii) subject to the filing of a notification with the SEC and prior written notification to Nasdaq, the ADSs will be delisted from Nasdaq. An application has been made to seek confirmation from the SGX-ST to delist the Company from the Official List of the SGX-ST upon the Scheme becoming effective and binding. The Company also intends to deregister the Company Shares and ADSs with the SEC and terminate its reporting obligations under the Exchange Act. Notice is hereby given that, conditional upon the Scheme becoming effective, the ADS Deposit Agreement will be terminated as at the Effective Date. |
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13. | IMPLEMENTATION OF THE SCHEME |
13.1 | Court Approval. Upon the approval of the Scheme by a majority in number of, and representing not less than 75 per cent. in value of the Company Shares held by, Shareholders present and voting, either in person or by proxy, at the Court Meeting, an application will be made to the Court by the Company to approve the Scheme. Voting at the Court Meeting will be by way of poll. |
13.2 | Procedures. Subject to the Scheme becoming effective and binding, the procedures for the implementation of the Scheme are as follows: |
13.2.1 | Transfer of Scheme Shares: the Scheme Shares held by Entitled Shareholders will be transferred to the Acquirorand/or its nominee, as follows: |
(i) | in the case of Entitled Shareholders (not being Depositors), the Company shall authorise any person to execute or effect on behalf of all such Entitled Shareholders, not later than three Business Days after the Effective Date, an instrument or instruction of transfer of all the Scheme Shares held by such Entitled Shareholders and every such instrument or instruction of transfer so executed shall be effective as if it had been executed by the relevant Entitled Shareholders; and | |
(ii) | in the case of Entitled Shareholders (being Depositors), CDP shall, not later than three Business Days in Singapore after the Effective Date, debit all the Scheme Shares standing to the credit of the Securities Account of such Entitled Shareholders and credit all of such Scheme Shares to the Securities Account of the Acquiror or such Securities Accounts as directed by the Acquiror. |
13.2.2 | Payment of the Scheme Consideration: the Acquiror shall, not later than 10 days after the Effective Date, and against the transfer of the Scheme Shares set out inParagraph 13.2.1 of this Explanatory Statement above, make payment of the Scheme Consideration payable on the transfer of the Scheme Shares to: |
(i) | Entitled Shareholders whose Scheme Shares are not deposited with CDP: |
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(ii) | Entitled Shareholders whose Scheme Shares are deposited with CDP: |
13.2.3 | Cancellation of Share Certificates: as at and from the Effective Date, all existing share certificates relating to the Scheme Shares held by Entitled Shareholders will cease to have any effect as evidence of title of the Scheme Shares represented therein, and Entitled Shareholders (not being Depositors) are required to forward their existing share certificates |
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relating to their Scheme Shares to M&C Services Private Limited’s registered office at 138 Robinson Road #17-00 The Corporate Office Singapore 068906 as soon as possible, but not later than 10 days after the Effective Date for cancellation. |
13.3 | Additional Procedures for ADS Holders. On the Effective Date, the Company Shares underlying the ADSs will be transferred to the Acquiror, and the certificates in respect of the ADSs should be surrendered to the ADS Depositary in accordance with the ADS Deposit Agreement and any procedures as may be notified by the ADS Depositary to the ADS Holders. The ADS Custodian Bank, as Entitled Shareholder pursuant toParagraph 13.2.2(ii) of this Explanatory Statement, will receive an amount in Singapore Dollars equal to the total Scheme Consideration payable in respect of all the Scheme Shares held by the ADS Custodian Bank in accordance with the Scheme. Upon the ADS Depositary receiving confirmation from the ADS Custodian Bank of receipt of the aggregate Scheme Consideration from CDP, the ADS Depositary will, pursuant to and in accordance with the terms of the ADS Deposit Agreement, as promptly as practicable: |
13.3.1 | convert or cause to be converted (by sale or in any other manner as it may reasonably determine) such aggregate amount of the Scheme Consideration from Singapore Dollars into United States Dollars (the “Converted Amount”); and | |
13.3.2 | distribute such Converted Amount (net of any applicable fees, any reasonable and customary expenses incurred in such conversion and any expenses incurred on behalf of ADS Holders in complying with currency exchange control or other governmental requirements) (the “Net Converted Amount”) upon surrender of their ADSs to the ADS Depositary. |
14. | BOOKS CLOSURE DATE |
14.1 | Notice of Books Closure Date. Subject to the approval of the Scheme by Shareholders at the Court Meeting and the approval of the Scheme by the Court, notice will be given of the Books Closure Date for the purpose of determining the entitlements of the Entitled Shareholders under the Scheme. The Books Closure Date is tentatively scheduled on 9 December 2009 at 5:00 p.m. |
14.2 | Dates of Closure of ADS Depositary Books. Upon receipt of notice from the Company of the Books Closure Date, the ADS Depositary shall announce the applicable dates for closure of the ADS Depositary books for issuance and cancellation of ADSs. |
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14.3 | No Transfers. No transfer of the Company Shares may be effected after the Books Closure Date. |
14.4 | Delisting, Termination of ADS Deposit Agreement and Deregistration with the SEC. Upon the Scheme becoming effective and binding, the Company will become a wholly-owned subsidiary of the Acquiror, and (i) subject to the approval of theSGX-ST, the Company will be delisted from the Official List of theSGX-ST and (ii) subject to the filing of a notification with the SEC and prior written notification to Nasdaq, the ADSs will be delisted from Nasdaq. An application has been made to seek confirmation from the SGX-ST to delist the Company from the Official List of the SGX-ST upon the Scheme becoming effective and binding. The Company also intends to deregister the Company Shares and ADSs with the SEC and terminate its reporting obligations under the Exchange Act. Notice is hereby given that, conditional upon the Scheme becoming effective, the ADS Deposit Agreement will be terminated as at the Effective Date. |
14.4.1 | the Company is expected to be delisted and withdrawn from the Official List of theSGX-ST on or about 18 December 2009. It is therefore expected that, subject to the approval of the SGX-ST, the Company Shares will cease to be traded on the SGX-ST from 4 December 2009 at 5:00 p.m., being three Market Days before the expected Books Closure Date; and | |
14.4.2 | the ADSs are expected to be suspended from trading on Nasdaq upon the effectiveness of the Scheme on 10 December 2009 and, subject to the filing of a notification with the SEC and Nasdaq, the ADSs are expected to be formally delisted and withdrawn from Nasdaq on or about 21 December 2009. |
15. | SETTLEMENT AND REGISTRATION PROCEDURES |
15.1 | Settlement and Registration Procedures. Subject to the Scheme becoming effective and binding, the following settlement and registration procedures will apply: |
15.1.1 | Entitled Shareholders whose Scheme Shares are not deposited with CDP: |
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15.1.2 | Entitled Shareholders whose Scheme Shares are deposited with CDP: |
15.2 | Additional Settlement Procedures for ADS Holders. Entitlements of ADS Holders to the distribution of the Net Converted Amount (or any part thereof) will be determined on the basis of the number of ADSs surrendered to the ADS Depositary. |
16. | DIRECTORS’ AND SUBSTANTIAL SHAREHOLDERS’ INTERESTS IN THE COMPANY SHARES |
17. | OVERSEAS SHAREHOLDERS |
17.1 | Overseas Shareholders. The applicability of the Scheme to Overseas Shareholders may be affected by the laws of the relevant overseas jurisdictions. Accordingly, Overseas Shareholders should keep themselves informed of and observe any applicable legal requirements. This Scheme Document will be sent to all Overseas Shareholders unless, due to restrictions or potential restrictions on sending such documents into the relevant overseas jurisdictions, this Scheme Document may not be sent to any Overseas Shareholder in such jurisdictions. For the avoidance of doubt, the Scheme is proposed to all Shareholders and applies to all the Scheme Shares, including those to whom this Scheme Document may not be and will not be sent. |
17.2 | Foreign Jurisdiction. It is the responsibility of any Overseas Shareholder who wishes to (i) request for this Scheme Documentand/or any related documents or (ii) vote on or participate in the Scheme, to satisfy itself/himself as to the full observance of the laws of the relevant jurisdiction in that connection, including the obtaining of any governmental or other |
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consent which may be required, and compliance with all necessary formalities or legal requirements. |
17.3 | Notice. The Company and the Acquiror each reserves the right to notify Shareholders of any matter, including the fact that the Scheme has been proposed, to any or all Shareholders with a registered address outside Singapore and the United States by an announcement to the SGX-ST or paid advertisement in a daily newspaper published and circulated in Singapore, and in each case, submitted to the SEC via a report onForm 6-K, in which case such notice shall be deemed to have been sufficiently given notwithstanding any failure by any Shareholder to receive or see such announcement or advertisement. For the avoidance of doubt, for as long as the Company remains listed on the SGX-ST, it will continue to notify all Shareholders of any matter relating to the Scheme by announcement to the SGXNET, and for so long as the Company remains a reporting company in the United States, it will submit to the SEC material matters relating to the Scheme via a report onForm 6-K. |
18. | TAXATION |
18.1 | Singapore Taxation. The statements made herein regarding taxation are general in nature and based on certain aspects of the tax laws of Singapore, announced budget measures in the Singapore Budget Statement 2009 and administrative guidelines issued by the relevant authorities in force as at the Latest Practicable Date and are subject to the enactment of such budget measures and any changes in such laws or administrative guidelines, or in the interpretation of these laws or guidelines, occurring after such date, which changes could be made on a retrospective basis. These laws and guidelines are also subject to various interpretations and the relevant tax authorities or the courts could later disagree with the explanations or conclusions set out below. The statements below are not to be regarded as advice on the tax implications or tax position of any Shareholder or ADS Holder. The statements made herein do not purport to be a comprehensive description of all of the tax considerations that may be relevant to a decision to vote in favour of the Scheme at the Court Meeting and do not purport to deal with the tax consequences applicable to all categories of investors some of which (such as dealers in securities) may be subject to special rules: |
18.1.1 | Gains on Disposal or Exercise: Singapore does not impose tax on capital gains. However, there are currently no specific laws or regulations which address the characterisation of capital gains and hence gains or profits derived by any Shareholder |
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or ADS Holder from the disposal of any Company Share or ADS may be construed to be of an income nature and subject to tax, especially if they arise from activities which are regarded as the carrying on of a trade or business in Singapore. |
18.1.2 | Stamp Duty: Where existing Company Shares or ADSs evidenced in certificated form are acquired in Singapore, stamp duty is payable on the instrument of transfer of the Company Shares or ADSs at the rate of S$2.00 for every S$1,000 of the consideration for, or market value of, the Company Shares or ADSs, whichever is higher. The stamp duty is borne by the purchaser (and, in the case of the Scheme, by the Acquiror). Where no instrument of transfer of the Company Shares or ADSs is required to be executed, no stamp duty is payable on the acquisition of existing Company Shares or ADSs. Where an instrument of transfer of the Company Shares or ADSs is wholly executed outside Singapore and is received in Singapore stamp duty will be payable within 30 days of receipt of the instrument of transfer in Singapore. |
18.1.3 | Estate Duty: Singapore estate duty has been abolished with respect to all deaths occurring on or after 15 February 2008. |
18.2 | U.S. Taxation. TO COMPLY WITH INTERNAL REVENUE SERVICE CIRCULAR 230, YOU ARE HEREBY NOTIFIED THAT (i) THIS SCHEME DOCUMENT IS NOT INTENDED OR WRITTEN BY US TO BE USED, AND CANNOT BE USED BY ANY TAXPAYER, FOR THE PURPOSE OF AVOIDING PENALTIES THAT MAY BE IMPOSED ON THE TAXPAYER UNDER THE INTERNAL REVENUE CODE, (ii) THIS SCHEME DOCUMENT IS WRITTEN TO SUPPORT THE PROMOTION OR MARKETING OF THE TRANSACTIONS OR MATTERS ADDRESSED HEREIN AND (iii) A TAXPAYER SHOULD SEEK ADVICE BASED ON THE TAXPAYER’S PARTICULAR CIRCUMSTANCES FROM AN INDEPENDENT TAX ADVISOR. |
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18.2.1 | Disposition of Company Shares or ADSs: |
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18.2.2 | Passive Foreign Investment Company: |
18.2.3 | Information Reporting: |
19. | ACTION TO BE TAKEN BY SHAREHOLDERS AND ADS HOLDERS |
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20. | IFA’S ADVICE TO THE INDEPENDENT DIRECTORS |
21. | GENERAL |
21.1 | Copies of Scheme Document. Shareholders, including Overseas Shareholders, may obtain additional copies of this Scheme Document and any related documents, during normal business hours at the registered office of the Company at 60 Woodlands Industrial Park D Street 2 Singapore 738406 on any day prior to the date of the Court Meeting. Alternatively, an Overseas Shareholder may write to the Company at the same address to request for this Scheme Document and any related documents to be sent to an address in Singapore by ordinary post at it/his own risk, not later than 10 Market Days prior to the date of the Court Meeting. |
21.2 | General Information. Your attention is drawn to further relevant information in theAppendices of this Scheme Document. TheseAppendices form part of this Scheme Document. This Explanatory Statement is qualified by, and should be read in conjunction with, the full text of this Scheme Document, including the Scheme as set out on pages 213 to 219 of this Scheme Document. |
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![(MORGAN STANLEY LETTER HEAD)](https://capedge.com/proxy/6-K/0000950123-09-049467/z00367z0036711.gif)
Chartered Semiconductor Manufacturing Ltd.
60 Woodlands Industrial Park D, Street Two
Singapore 738406
(i) | reviewed certain publicly available financial statements and other business and financial information of the Company; |
(ii) | reviewed certain internal financial statements and other financial and operating data concerning the Company; |
(iii) | reviewed certain financial projections prepared by the management of the Company; |
(iv) | discussed the past and current operations and financial condition and the prospects of the Company with senior executives of the Company; |
(v) | reviewed the reported prices and trading activity for the Shares (including Shares held in the form of ADSs); |
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(vi) | compared the financial performance of the Company and the prices and trading activity of the Shares (including Shares held in the form of ADSs) with that of certain other publicly-traded companies comparable with the Company and their securities; |
(vii) | reviewed the financial terms, to the extent publicly available, of certain comparable acquisition transactions; |
(viii) | participated in discussions and negotiations among representatives of the Company, the Buyer and certain parties and their financial and legal advisors; |
(ix) | reviewed the Scheme Implementation Agreement, and certain related documents (including the announcement jointly issued by the Company and the BidCo in connection with the Scheme); and |
(x) | performed such other analyses and considered such other factors as we have deemed appropriate. |
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By: |
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3 Temasek Avenue | T 65 6432 1000 | |||
#17-00 Centennial Tower | F 65 6722 4200 | |||
Singapore 039190 |
![(CITI LOGO)](https://capedge.com/proxy/6-K/0000950123-09-049467/z00367z0036712.gif)
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![(DEUTSCHE BANK LOGO)](https://capedge.com/proxy/6-K/0000950123-09-049467/z00367z0036709.gif)
Singapore Branch
#17-00 South Tower
Singapore 048583
Fax +65 6538 2610 / 6538 2629
Chartered Semiconductor Manufacturing Ltd.
60 Woodlands Industrial Park D
Street 2
Singapore 738406
1. | INTRODUCTION |
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2. | TERMS OF REFERENCE |
(a) | reviewed certain publicly available information collated by us including financial statements of the Company and other announcements made by the Company, information contained in the Scheme Document, as well as certain information provided and representations made to us by the Directors and management (“Management”) of the Company; |
(b) | compared the financial performance of the Company and the prices and trading activity of its shares with those of certain other comparable publicly-traded companies; |
(c) | reviewed the financial terms, to the extent publicly available, of certain comparable acquisition transactions; |
(d) | reviewed the reported historical prices and trading activity of the Company Shares over different observation periods; |
(e) | reviewed publicly available analyst reports including recent target prices of the Company prior to the Announcement; |
(f) | participated in discussions with representatives of the Company and its advisers with respect to the Scheme; and |
(g) | performed such other analysis as we have deemed appropriate. |
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3. | THE SCHEME |
3.1 | Terms of the Scheme |
(a) | all the Scheme Shares held by Entitled Shareholders will be transferred to the Acquiror: |
(i) | fully paid; | |
(ii) | free from all Encumbrances; and | |
(iii) | together with all rights, benefits and entitlements as at the Announcement Date and thereafter attaching thereto, including the right to receive and retain all dividends, rights and other distributions (if any) which may be announced, declared, paid or made by the Company on or after the Announcement Date; and |
(b) | in consideration for such transfer, and upon and subject to the Scheme becoming effective, each Entitled Shareholder will be entitled to receive from the Acquiror the Scheme Consideration, beingS$2.68 in cash for each Scheme Share, provided that if any dividend or distribution with respect to the Company Shares is declared or announced on or after the Announcement Date, and such dividend or distribution is paid or made to holders of the Company Shares of record as at any date that is on or prior to the Effective Date, the Scheme Consideration shall be reduced by the amount of such dividend or distribution; and |
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(c) | ADS Holders will be entitled to receive their consideration from the ADS Depositary in accordance with the terms of the ADS Deposit Agreement. Based on the prevailing exchange rate from Bloomberg L.P. on the Latest Practicable Date of S$1.4138 to US$1, the equivalent amount of consideration for each ADS is approximately US$18.96, less the applicable ADS Depository’s fees, taxes and expenses. The actual amount per ADS that ADS Holders will receive will depend on the applicable prevailing exchange rate at the time of conversion by the ADS Depository of the Scheme Consideration from Singapore Dollars to United States Dollars and the amount of applicable ADS Depository’s fees, taxes and expenses. |
(a) | all Company Shares, including Company Shares represented by ADSs; and |
(b) | all new Company Shares unconditionally issued or to be issued on or before the Books Closure Date pursuant to (i) the valid exercise of any Options, (ii) the vesting of any awards under the RSU Plan, (iii) the vesting of any awards under the PSU Plan, (iv) the valid conversion of any CRPS into new Company Shares and (v) the valid exercise by GS of the GS Option. |
3.2 | Principal Terms of the Implementation Agreement |
(a) | the Matching Right conferred upon the Acquiror as set out inparagraph 3.5 of the Company’s Letter to Shareholders in the Scheme Document; |
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(b) | the Switch Option conferred upon the Acquiror as set out inparagraph 3.6 of the Company’s Letter to Shareholders in the Scheme Document; |
(c) | the non-solicitation obligations of the Company as set out inparagraph 3.7 of the Company’s Letter to Shareholders in the Scheme Document; |
(d) | certain restrictions on the Acquiror from acquiring or making an offer to acquire, Company Shares or Company Convertible Securities, or entering into any agreement, arrangement or understanding with any person in relation to any of the foregoing, for certain specified periods, as set out inparagraph 3.8 of the Company’s Letter to Shareholders in the Scheme Document; and |
(e) | the acceleration of all outstanding RSUs and PSUs granted under the RSU Plan and the PSU Plan and the undertaking by the Acquiror to make such payment for the Company Shares comprised in such accelerated RSUs and PSUs, as set out inparagraph 3.10 of the Company’s Letter to Shareholders in the Scheme Document. |
3.3 | The Preference Share Offer |
3.4 | Options |
3.5 | The GS Option |
3.6 | Irrevocable Undertakings |
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(a) | Vote in favour of the Scheme at the Court Meeting: vote or procure the voting of all its Company Shares (i) in favour of the Scheme at the Court Meeting and (ii) against any resolution or proposal to adjourn the Court Meeting, except in the event the Company seeks an adjournment of the Court Meeting for any reason described inparagraph 3.5.4 of the Company’s Letter to Shareholders in the Scheme Document or with the prior written consent of the Acquiror; |
(b) | Accept the Offer: in the event the Acquiror validly exercises the Switch Option, (i) accept the Offer in respect of all its Company Shares not later than five business days after the despatch by or on behalf of the Acquiror of the formal document in relation to the Offer and (ii) not withdraw its acceptance of the Offer, without the prior written consent of the Acquiror; and |
(c) | Vote in favour of the Special Resolution (1) and Special Resolution (2) at the EGM: to the extent permitted by applicable laws, vote or procure the voting of all its Company Shares (i) in favour of Special Resolution (1) and Special Resolution (2) at the EGM, and (ii) against any resolution or proposal to adjourn the EGM, except in the event the Company seeks an adjournment of the EGM where the Company seeks an adjournment of the Court Meeting for any reason described inparagraph 3.5.4 of the Company’s Letter to Shareholders in the Scheme Document or with the prior written consent of the Acquiror. |
4. | INFORMATION ON THE ACQUIROR AND ATIC |
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5. | INFORMATION ON THE COMPANY |
6. | RATIONALE FOR THE SCHEME AND FUTURE PLANS FOR THE COMPANY |
7. | FINANCIAL ASSESSMENT OF THE SCHEME |
(a) | trading comparable analysis to assess the valuation multiples implied by the Scheme Consideration in comparison with trading multiples of comparable companies; |
(b) | precedent transaction analysis to assess the valuation multiples implied by the Scheme Consideration in comparison with multiples of similar control transactions; |
(c) | share price analysis to assess how the Scheme Consideration compares to the historical share price of the Company over different observation periods; |
(d) | comparison of the Scheme Consideration to the average analyst target prices for the Company prior to the Announcement; and |
(e) | precedent take-over analysis to compare the premium/discount of the Scheme Consideration over the historical share price of the Company to selected take-over offer transactions in Singapore. |
(a) | Trading comparable analysis |
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(i) | Price to net tangible book value(1) per share (“P/BV”); |
(ii) | Enterprise value (“EV”) to normalised(2) earnings before interest, tax, deprecation and amortisation (“EBITDA”) for the last twelve months (“EV/LTM EBITDA”); and |
(iii) | EV to revenue (“Revenue”) for the last twelve months (“EV/LTM Revenue”). |
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Market Cap | ||||||||
Company | Company description | (S$mn) | ||||||
United Microelectronics Corporation (“UMC”) | UMC, together with its subsidiaries, manufactures and sells advanced process integrated circuits (“ICs”) for applications spanning various sectors of the semiconductor industry in Taiwan. It develops system-on-chip (“SOC”) ICs for various applications, including copper interconnects,low-k dielectrics, embedded DRAM, and mixed signal/radio frequency complementary metal oxide semiconductor (“CMOS”). UMC also offers foundry services and mask tooling services. The company was founded in 1980 and is headquartered in Hsinchu City, Taiwan with additional offices in Japan, Singapore, Europe, and the United States. | 9,125 | ||||||
Semiconductor Manufacturing International Corporation (“SMIC”) | SMIC, together with its subsidiaries, engages in the computer-aided design, manufacture, packaging, testing, and trade of integrated circuits. It provides wafer fabrication services and manufactures logic, mixed-signal and radio frequency, high voltage, memory, and specialty semiconductors. It serves integrated device manufacturers, fabless semiconductor companies, and systems companies. The company has a strategic partnership agreement with Toppan Printing Co., Ltd. and strategic cooperation agreement with Datang Telecom Technology & Industry Holdings Co., Ltd. SMIC sells its products and services in the United States, Europe, Taiwan, Japan, and the Asia Pacific. The company was founded in 2000 and is headquartered in Shanghai, the People’s Republic of China. | 1,487 | ||||||
Taiwan Semiconductor Manufacturing Company (“TSMC”) | TSMC engages in the manufacturing, selling, packaging, testing, and computer-aided designing of various integrated circuits and other semiconductor devices, as well as manufacturing of masks. It offers a range of wafer fabrication processes, logic semiconductors and memory semiconductors. The company also offers a range of design services. TSMC serves primarily fabless semiconductor companies/systems companies and integrated device manufacturers in North America, Asia, and Europe. TSMC was founded in 1987 and is headquartered in Hsinchu, Taiwan. | 73,192 | ||||||
Note: Market capitalization in S$ as at the Latest Practicable Date and translated at the relevant spot exchange rate as at that date | ||||||||
Source: Company filings, Company websites | ||||||||
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Comparable companies trading analysis | ||||||||||||||||||||||||||||||
Normalized enterprise | ||||||||||||||||||||||||||||||
value / Last twelve | Second | |||||||||||||||||||||||||||||
Enterprise | Market | % of | months (“LTM”) | Quarter 2009 | ||||||||||||||||||||||||||
value(a) | Capitalization(b)(c) | 52 week | ||||||||||||||||||||||||||||
(S$mn) | (S$mn) | high | Revenue (x) | EBITDA (x) | P/BV (x) | |||||||||||||||||||||||||
Leading Edge Foundries | ||||||||||||||||||||||||||||||
UMC | 7,651 | 9,125 | 97 | % | 2.15 | 6.4 | 1.09 | |||||||||||||||||||||||
SMIC | 2,518 | 1,487 | 77 | % | 1.68 | 4.4 | 0.48 | |||||||||||||||||||||||
Mean (UMC and SMIC only) | 1.91 | 5.4 | 0.78 | |||||||||||||||||||||||||||
TSMC | 62,988 | 73,192 | 100 | % | 5.29 | 9.3 | 3.90 | |||||||||||||||||||||||
Mean (all) | 3.04 | 6.7 | 1.82 | |||||||||||||||||||||||||||
Chartered - offer price of S$2.68 | 4,489 | 2,525 | 100 | % | 2.26 | 9.5 | 1.11 | |||||||||||||||||||||||
LTM comparable company financial analysis | ||||||||||||||||||||||||||||||||||||||||
FCF as | Net | Total | Net | |||||||||||||||||||||||||||||||||||||
Revenue | Revenue | EBITDA | a % of | income | debt(a)/ | debt(a)/ | ||||||||||||||||||||||||||||||||||
(S$mn) | growth | margin | revenue(d) | margin | ROIC(e) | EBITDA (x) | EBITDA (x) | |||||||||||||||||||||||||||||||||
Leading Edge Foundries | ||||||||||||||||||||||||||||||||||||||||
UMC | 3,559 | (28 | %) | 33 | % | 26 | % | (18 | %) | (5 | %) | 0.4 | Net cash | |||||||||||||||||||||||||||
SMIC | 1,501 | (29 | %) | 38 | % | (6 | %) | (40 | %) | (8 | %) | 2.8 | 1.7 | |||||||||||||||||||||||||||
Mean (UMC and SMIC only) | (29 | %) | 36 | % | 10 | % | (29 | %) | (6 | %) | 1.6 | 1.7 | ||||||||||||||||||||||||||||
TSMC | 11,912 | (24 | %) | 57 | % | 44 | % | 26 | % | 27 | % | 0.1 | Net cash | |||||||||||||||||||||||||||
Mean (all) | (27 | %) | 43 | % | 21 | % | (11 | %) | 5 | % | 1.1 | 1.7 | ||||||||||||||||||||||||||||
Chartered | 1,989 | (9 | %) | 24 | % | (13 | %) | (20 | %) | (6 | %) | 6.4 | 4.1 | |||||||||||||||||||||||||||
Notes: | ||||||||||||||||||||||||||||||||||||||||
LTM as of 30 June 2009 | ||||||||||||||||||||||||||||||||||||||||
Normalized EBITDA adjusted for one-off gains or charges. Tangible book value adjusted for goodwill and other intangible assets | ||||||||||||||||||||||||||||||||||||||||
(a) Total debt and net debt as of 30 June 2009 | ||||||||||||||||||||||||||||||||||||||||
(b) Market capitalization calculated based on the closing price as at the Latest Practicable Date and diluted shares outstanding (treasury method) as at the Latest Practicable Date. All relevant information has been converted into S$ based on the spot exchange rate as at the Latest Practicable Date | ||||||||||||||||||||||||||||||||||||||||
(c) Chartered’s market capitalization is calculated based on the Scheme Consideration and diluted shares outstanding (treasury method) as at the Latest Practicable Date | ||||||||||||||||||||||||||||||||||||||||
(d) FCF means free cash flow, which is derived from the formula EBITDA – capital expenditure | ||||||||||||||||||||||||||||||||||||||||
(e) ROIC means return on invested capital which is derived from the formula (LTM earnings before interest after tax) / (second quarter 2009 net debt + minority interest + shareholder’s equity) | ||||||||||||||||||||||||||||||||||||||||
Source: Company filings, Datastream | ||||||||||||||||||||||||||||||||||||||||
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n | The implied P/BV multiple is at a premium to the equivalent multiple of the Comparable Company Subset; | |
n | The implied EV/LTM Revenue multiple is at a premium to the equivalent multiple of the Comparable Company Subset; and | |
n | The implied EV/LTM EBITDA multiple is at a premium to the equivalent multiple of the Comparable Company Subset. |
(b) | Precedent transaction analysis |
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Stake | ||||||
Target | Target description | acquired | ||||
SMIC | SMIC, together with its subsidiaries, engages in the computer-aided design, manufacture, packaging, testing, and trade of integrated circuits. It provides wafer fabrication services and manufactures logic, mixed-signal and radio frequency, high voltage, memory, and specialty semiconductors. It serves integrated device manufacturers, fabless semiconductor companies, and systems companies. The company has a strategic partnership agreement with Toppan Printing Co., Ltd. and strategic cooperation agreement with Datang Telecom Technology & Industry Holdings Co., Ltd. SMIC sells its products and services in the United States, Europe, Taiwan, Japan, and the Asia Pacific. The company was founded in 2000 and is headquartered in Shanghai, the People’s Republic of China. | 16% | ||||
GLOBALFOUNDRIES | GLOBALFOUNDRIES, a silicon foundry, provides outsourced semiconductor manufacturing services. It also engages in the research, development, and design enablement of semiconductors for integrated device manufacturers, fabless, or original equipment manufacturer enterprises. The company offers automated precision and lean manufacturing, wafer fabrication, and supply chain management services. Its products include silicon on insulator integrated circuits, silicon chips, and microprocessors. The company has strategic partnerships with Qimonda and Fraunhofer-Gesellschaft. GLOBALFOUNDRIES was founded in 2009 and is headquartered in Sunnyvale, California. It has semiconductor production facilities in Dresden, Germany; Malta and Hopewell Junction, New York; and Austin, Texas. | 66% | ||||
Jazz Technologies Inc. | Jazz Technologies Inc., formerly known as Acquicor Technology Inc., is an independent semiconductor foundry that provides process technologies, design solutions, and application knowledge for the manufacture of analog and mixed-signal semiconductors. It offers specialty process technologies; design platform for analog and mixed-signal semiconductors; and specialty process technologies, including analog CMOS, radio frequency CMOS, high voltage CMOS, BiCMOS, and SiGe BiCMOS processes. The company’s analog and mixed-signal semiconductor devices are used in cellular phones, wireless local area networking devices, digital TVs, set-top boxes, gaming devices, switches, routers, and broadband modems. Jazz Technologies Inc. also provides circuit design, photo mask making, wafer fabrication, probe, and assembly and test services. | 100% | ||||
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Stake | ||||||
Target | Target description | acquired | ||||
Hitachi Semiconductor Singapore Pte Ltd (“Hitachi Semiconductor”) | Hitachi Semiconductor manufactures semiconductor devices. The company offers wafers, drivers for liquid crystal displays used in handphones, flash memory products, micro controller devices for automotive manufacturers, and integrated circuit card devices used in banking and subscriber identity module cards. It also provides dynamic random access memory, flash, and logic devices used in personal computers, servers, handphones, personal digital assistants, DVD recorders, car engine controls, and security products. In addition, the company offers testing services, as well as foundry services to semiconductor manufacturers. | 100% | ||||
Jazz Semiconductor Inc. | Jazz Semiconductor, Inc., an independent semiconductor foundry company, focuses on specialty process technologies for the manufacture of analog and mixed-signal semiconductor devices. It provides an array of specialty process technologies and design solutions for the manufacture of analog and mixed-signal semiconductors. The company primarily manufactures semiconductor wafers for its customers; offers circuit design services; and provides photomask making, wafer fabrication services, wafer probe services, and assembly and test services. Its customers’ analog and mixed-signal semiconductor devices are designed for use in products such as cellular phones, wireless local area networking devices, digital TVs, set-top boxes, gaming devices, switches, routers, and broadband modems. The company serves customers targeting wireless, optical networking, power management, storage, aerospace/defense, and other high performance applications primarily in the United States. The company was founded in 2002. | 100% | ||||
Source: Company filings, Company websites | ||||||
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(S$mn) | ||||||||||||||||||||||||||||||||||||||
Transaction value | Enterprise value / | |||||||||||||||||||||||||||||||||||||
Announced | Stake | Price / | LTM | LTM | ||||||||||||||||||||||||||||||||||
date | Target | Acquirer | acquired | Equity | Enterprise | Book | Revenue | EBITDA | ||||||||||||||||||||||||||||||
10 Nov 08 | SMIC(a) | Datang Holdings | 16.0 | % | 256 | NM | 0.32 | x | NM | NM | ||||||||||||||||||||||||||||
7 Oct 08 | GLOBALFOUNDRIES(a)(b) | ATIC | 65.8 | % | 2,627 | NA | 1.11 | x | NA | NA | ||||||||||||||||||||||||||||
20 May 08 | Jazz Technologies | Tower Semiconductor | 100.0 | % | 54 | 230 | 0.82 | x | 0.80 | x | 6.5 | x | ||||||||||||||||||||||||||
15 Feb 08 | Hitachi Semiconductor | Chartered | 100.0 | % | 344 | 335 | 0.97 | x | 1.23 | x | NA | |||||||||||||||||||||||||||
26 Sep 06 | Jazz Semiconductor | Acquicor Technology(c) | 100.0 | % | 413 | 369 | 0.99 | x | 1.17 | x | 8.4 | x | ||||||||||||||||||||||||||
All transaction mean: | 0.84 | x | 1.07 | x | 7.4 | x | ||||||||||||||||||||||||||||||||
Transaction mean for 100% acquisitions: | 0.93 | x | 1.07 | x | 7.4 | x | ||||||||||||||||||||||||||||||||
7 Sep 09 | Chartered(d) | ATIC | 100.0 | % | 2,525 | 4,489 | 1.11 | x | 2.26 | x | 9.5 | x | ||||||||||||||||||||||||||
Notes: | ||||||||||||||||||||||||||||||||||||||
Tangible book value adjusted for goodwill and other intangible assets. Normalized EBITDA adjusted for one-off gains or charges | ||||||||||||||||||||||||||||||||||||||
Exchange rate based on announcement date for each transaction | ||||||||||||||||||||||||||||||||||||||
NM is shown when the values are not meaningful | ||||||||||||||||||||||||||||||||||||||
NA is shown when the figures are not available | ||||||||||||||||||||||||||||||||||||||
Net debt as of latest available balance sheet prior to announcement of transaction | ||||||||||||||||||||||||||||||||||||||
(a) Transactions are not directly comparable due to less than 100 per cent. stake acquired; GLOBALFOUNDRIES transaction also included a long term supply contract with the seller, Advanced Micro Devices (“AMD”), who also retained a 34.2 per cent. stake, assuming full conversion of convertible instrument held by ATIC | ||||||||||||||||||||||||||||||||||||||
(b) Transaction multiple calculated on value received by AMD consisting of pro-forma ownership in Series A preferred shares in GLOBALFOUNDRIES and cash received for Series B preferred shares. Excludes impact of ATIC’s cash investment into GLOBALFOUNDRIES. ATIC ownership shown post cash investment and assumes full conversion of convertible instrument held by ATIC | ||||||||||||||||||||||||||||||||||||||
(c) Jazz Technologies was formally known as Acquicor Technology | ||||||||||||||||||||||||||||||||||||||
(d) Exchange rate based on the Latest Practicable Date | ||||||||||||||||||||||||||||||||||||||
Source: Company filings, Analysts’ reports | ||||||||||||||||||||||||||||||||||||||
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(c) | Share price analysis |
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(d) | Analysts’ estimates of price targets for the Company Shares |
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(e) | Precedent take-over analysis |
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Premium / (discount) of offer | |||||||||||||||||||||
price(a) to share price prior | |||||||||||||||||||||
to announcement | |||||||||||||||||||||
Volume-weighted | |||||||||||||||||||||
average price | |||||||||||||||||||||
Announced | (“VWAP”)(c) | ||||||||||||||||||||
Announced | value | ||||||||||||||||||||
date | Target | Acquirer | (S$mn) | 1-day(b) | 1-mth | 3-mths | 6-mths | ||||||||||||||
24 May 09 | Singapore Petroleum | PetroChina | 3,221 | 24% | 51% | 90% | 121% | ||||||||||||||
02 Dec 08 | Singapore Food Industries(d) | Singapore Airport Terminal Services | 509 | 26% | 22% | 21% | 19% | ||||||||||||||
25 Aug 08 | Singapore Computer Systems | Singapore Telecommunications | 238 | 56% | 70% | 70% | 68% | ||||||||||||||
10 Jul 08 | GMG Global(e)(f) | Sinochem International | 268 | 57% | 58% | 64% | 74% | ||||||||||||||
10 Jun 08 | SNP Corporation(g) | Toppan Printing | 209 | 39% | 40% | 47% | 48% | ||||||||||||||
07 Jun 08 | Unisteel Technology(h)(i) | Latch Holding (Labuan) | 785 | 44% | 45% | 45% | 28% | ||||||||||||||
04 Feb 08 | AsiaPharm(j) | LuYe Pharmaceutical Investment | 276 | 30% | 34% | 33% | 28% | ||||||||||||||
20 Jan 08 | Robinson and Company(k) | ALF Global | 619 | 64% | 65% | 60% | 54% | ||||||||||||||
06 Jan 08 | Straits Trading Company(l) | The Cairns | 1,452 | 35% | 31% | 35% | 42% | ||||||||||||||
07 Dec 07 | Sincere Watch(m) | A-A United | 530 | 10% | 19% | 33% | 38% | ||||||||||||||
05 Dec 07 | Frontline Technologies(h) | BT Singapore | 202 | 29% | 34% | 38% | 38% | ||||||||||||||
29 Oct 07 | Labroy Marine | Dubai Drydocks World | 2,358 | 3% | 9% | 20% | 18% | ||||||||||||||
08 Aug 07 | ECS Holdings | VST Holdings | 244 | 6% | 10% | 13% | 20% | ||||||||||||||
27 Jun 07 | United Test and Assembly Center(h)(n) | Global AT&T Electronics | 1,804 | 32% | 30% | 31% | 37% | ||||||||||||||
13 Jun 07 | Sembawang Kimtrans(o) | Toll Express (Asia) | 326 | 13% | 14% | 15% | 16% | ||||||||||||||
28 May 07 | Pan United Marine | Dubai Drydocks World | 648 | 3% | 14% | 22% | 33% | ||||||||||||||
22 May 07 | Amtek Engineering(p) | Metcomp Co (Singapore) | 262 | 41% | 50% | 59% | 66% | ||||||||||||||
05 Apr 07 | MMI Holdings(h)(q) | Precision Capital | 1,005 | 16% | 28% | 44% | 62% | ||||||||||||||
04 Mar 07 | RSH | Golden Ace | 370 | (13%) | 15% | 42% | 44% | ||||||||||||||
01 Mar 07 | STATS ChipPAC(o) | Singapore Technologies Semiconductors | 1,842 | 18% | 23% | 33% | 47% | ||||||||||||||
08 Jan 07 | Guthrie GTS(r) | Alam Indah Bintan | 164 | 16% | 20% | 32% | 38% | ||||||||||||||
Minimum | (13%) | 9% | 13% | 16% | |||||||||||||||||
Mean | 26% | 32% | 40% | 45% | |||||||||||||||||
Median | 26% | 30% | 35% | 38% | |||||||||||||||||
Maximum | 64% | 70% | 90% | 121% | |||||||||||||||||
7 Sep 09 | Chartered(s) | ATIC | 2,525 | 1% | 13% | 19% | 44% | ||||||||||||||
Chartered(t) | ATIC | 2,525 | 23% | 41% | 64% | 62% | |||||||||||||||
Source: Bloomberg, Company filings, Factiva | |||||||||||||||||||||
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Notes: | ||||
(a) | Offer price based on final bid price per share | |||
(b) | Last transacted price before the announcement of the relevant transaction or the possibility of the relevant transaction | |||
(c) | Volume-weighted average share price for the1-month,6-month and12-month periods up to and inclusive of day before announcement of the offer, which is computed as the sum of trading value divided by the sum of trading volume for the respective relevant periods | |||
(d) | Premium calculated with reference to 21 October 2008, being the last full day of trading prior to the query by the SGX-ST regarding a substantial increase in the price of shares in Singapore Food Industries Limited (“SFI”). On 23 October 2008, SFI announced that Ambrosia Investment Pte. Ltd. was evaluating options in respect of its stake in SFI | |||
(e) | Partial offer | |||
(f) | Premium calculated with reference to 24 April 2008, being the last full day of trading of the shares prior to an unusual increase in the price and volume of traded shares in GMG Global Limited (“GMG Global”). On 10 July 2008, GMG Global announced the voluntary conditional cash partial offer for 51 per cent. of the issued andpaid-up shares of GMG Global by Sinochem International (Overseas) Pte. Ltd. | |||
(g) | Premium calculated with reference to 17 April 2008, being the last trading day prior to SNP Corp Ltd’s (“SNP”) announcement that it had been informed by its majority shareholder, Green Dot Capital Pte Ltd (“Green Dot”) that Green Dot was evaluating options with respect to its 54 per cent. stake in SNP | |||
(h) | Scheme of arrangement | |||
(i) | On 16 April 2008, Unisteel Technology Ltd (“Unisteel”) replied to a query by the SGX-ST regarding the substantial increase in Unisteel’s share price on 15 April 2008 that Unisteelwas in the preliminary stages of reviewing strategic options. On 7 June 2008, the proposed acquisition relating to Unisteel was announced. The market premia in the table above were computed with reference to 14 April 2008, being the last full day of trading prior to the query by SGX-ST on 15 April 2008 | |||
(j) | Premium calculated with reference to 29 January 2008, being the last trading day prior to high trading volumes and substantial price increases in AsiaPharm Group Ltd shares,leading to a suspension of the shares on 31 January 2008 prior to the announcement date of 5 February 2008 | |||
(k) | On 20 January 2008, ALF Global Private Ltd (“ALF”) announced its intention to make a voluntary conditional cash offer for the shares in the capital of Robinson and Company, Limited at a price of S$6.25. Subsequently, ALF increased the offer price to S$7.00 on 17 March 2008, and to S$7.20 on 3 April 2008. The bid premia in the table above were computed based on the final offer price of S$7.20 and market prices prior to the first offer announcement on 20 January 2008 | |||
(l) | On 6 January 2008, Standard Chartered Bank on behalf of The Cairns Pte Ltd (“The Cairns”) announced itsintention to make a voluntary conditional cash offer for the shares in the capital of The Straits Trading Company Limited at a price of S$5.70. Subsequently, The Cairns increased the offer price to S$6.50 on 28 January 2008, and to S$6.70 on 18 February 2008. The bid premia in the table above were computed based on the final offer price of S$6.70 and market prices prior to the first offer announcement on 6 January 2008. Incomputing the premium of the offer price over the last transacted price, the last transacted price on 4 January 2008 had been used | |||
(m) | On 7 December 2007, a pre-conditional offer for Sincere Watch Limited (“Sincere Watch”) was announced. Theoffer price for each Sincere Watch share was S$2.051 in cash and 0.228 new share in the capital of Peace Mark (Holdings) Limited (a company listed on Hong Kong Stock Exchange) at the issue price of HK$12.096 each (equivalent to S$2.246 at the exchange rate ratio of S$1.00: HK$5.385 as at 6 December 2007, being the date immediately preceding the pre-conditional offer), equivalent to a total | |||
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notional value of approximately S$2.563. The computations in the table above were based on such notional value and prices prior to 7 December 2007 | ||||
(n) | Premium calculated with reference to 1 June 2007, being the last trading day prior to the publication of the DBS Group research report saying that United Test and Assembly Center Ltd was a “good buyout candidate” | |||
(o) | 2-tiered offer | |||
(p) | Premium calculated with reference to 13 April 2007, being the last full day of trading in the shares prior to the announcement on 16 April 2007 by Amtek Engineering Ltd (“Amtek Engineering”) announcing that certain shareholders, including a substantial shareholder and shareholders who are executive directors, have been approached in relation to possible transactions involving their shares in Amtek Engineering | |||
(q) | Premium calculated with reference to 8 February 2007, being the last trading day before MMI Holdings Ltd (“MMI”) announced it had received expressions of interest in relation to a potential transaction involving MMI | |||
(r) | On 28 February 2007, Kim Eng Capital Pte Ltd, on behalf of Alam Indah Bintan Pte Ltd (“Alam Indah Bintan”), announced its intention to make a voluntary conditional cash offer for the shares in the capital of Guthrie GTS Limited (“Guthrie”) at a price of S$0.395. Subsequently, Alam Indah Bintan increased the offer price to S$0.435 on 5 March 2007. The market premia in the table above were computed with reference to 28 December 2006, being the last full day of trading of the shares in Guthrie prior to the release of a holding announcement by Guthrie on 29 December 2006 released by Guthrie in relation to a possible offer for Guthrie. On 8 January 2007, the offer was announced by Kim Eng Capital Pte Ltd, on behalf of Alam Indah Bintan | |||
(s) | Based on the closing share prices as at the Pre-Announcement Date | |||
(t) | Based on the closing share prices as at the Unaffected Price Date | |||
Source: Bloomberg, Company filings, Factiva | ||||
(i) | a premium of approximately 23 per cent. to the closing price of the Company Shares on the Unaffected Price Date and a premium of approximately 1 per cent. to the closing price of the Company Shares on the Pre-Announcement Date. This compares to a premium of 26 per cent. to the mean of the last trading price for the selected transactions; |
(ii) | a premium of approximately 41 per cent. to the1-month VWAP of the Company Shares prior to the Unaffected Price Date and a premium of approximately 13 per cent. to the1-month VWAP of the Company Shares prior to the Pre-Announcement Date. This compares to a premium of 32 per cent. to the mean of the1-month VWAP for the selected transactions; |
(iii) | a premium of approximately 64 per cent. to the3-month VWAP of the Company Shares prior to the Unaffected Price Date and a premium of approximately 19 per cent. to the3-month VWAP of the Company Shares prior to the Pre-Announcement Date. This compares to a premium of 40 per cent. to the mean of the3-month VWAP for the selected transactions; and |
(iv) | a premium of approximately 62 per cent. to the6-month VWAP of the Company Shares prior to the Unaffected Price Date and a premium of approximately 44 per cent. to the6-month VWAP of the Company Shares prior to the Pre-Announcement Date. This compares to a premium of 45 per cent. to the mean of the6-month VWAP for the selected transactions. |
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8. | OTHER CONSIDERATIONS |
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9. | CONCLUSION AND ADVICE |
(a) | the valuation multiples implied by the Scheme Consideration are at a premium to the trading levels of UMC and SMIC, which we consider to be the most comparable companies to the Company; |
(b) | the valuation multiples implied by the Scheme Consideration are at a premium to the transaction multiples where a 100 per cent. stake was acquired; |
(c) | the Scheme Consideration represents a 31 per cent. premium to the mean of the analysts’ target price of S$2.05(6); |
(d) | the Company Shares have traded in a band between S$0.70 and S$2.98 (on a rights issue and share consolidation adjusted basis) in the 12 month period prior to the Announcement; |
(e) | on 29 May 2009, the Singapore Business Times reported on a possible acquisition by ATIC of Temasek’s shareholding in the Company. As such, the last traded price of the Company Shares on 28 May 2009 can be regarded as the “unaffected” share price prior to market speculation regarding a potential transaction; |
(f) | the Scheme Consideration represents a 23 per cent. premium to the closing price on 28 May 2009, a 1 per cent. premium to the closing price on the Pre-Announcement Date and a 44 per cent. premium to the six-month VWAP prior to the Announcement Date; |
(g) | following the Announcement, the Company Shares have traded in a band between S$2.58 and S$2.62, suggesting that the market does not expect any competing offer to be forthcoming; |
(h) | the Company has confirmed to us that alternative strategic options were considered prior to the Announcement, including preliminary discussions with alternative partners, but the Company was of the view that none of these options represented as compelling a proposal as the Scheme; |
(i) | the Company has confirmed to us the need for substantial, continued capital investment going forward. We note that the Company currently has the highest financial leverage(7) of the comparable companies in its peer group; |
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(j) | Temasek(8), the 62.28 per cent. majority shareholder of the Company, has provided an irrevocable commitment to ATIC to vote in favor of the Scheme; and |
(k) | the Company has not been approached by any person since the Announcement with a competing offer. |
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Sandeep Pahwa | Suneet Weling | |
Managing Director | Director |
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1. | INTRODUCTION |
2. | THE SCHEME |
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3. | OFFER AND OTHER ARRANGEMENTS |
3.1 | Preference Share Offer |
3.2 | Extraordinary General Meeting and Class Meeting |
(a) | Where the Acquisition is to be effected by way of: |
(i) | a Scheme, subject to and upon the Scheme becoming effective and binding in accordance with its terms, if any new Company Shares are issued to any person other than any of GLOBALFOUNDRIES, the Acquiror or any subsidiary of any holding company for the time being of the Acquiror (a “New Member”) after: |
(aa) | the Voting Record Time and on or prior to the Effective Date; or | |
(bb) | the Effective Date, |
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(ii) | an Offer, subject to and upon the completion of the Compulsory Acquisition, if any new Company Shares are issued to any New Member after: |
(aa) | the Offer Cut-Off Date and on or prior to the Compulsory Acquisition Completion Date; or | |
(bb) | the Compulsory Acquisition Completion Date, |
(b) | Subject to and upon: |
(i) | where the Acquisition is to be effected by way of a Scheme, the Scheme becoming effective and binding in accordance with its terms; or | |
(ii) | where the Acquisition is to be effected by way of an Offer, the completion of the Compulsory Acquisition, |
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3.3 | Switch Option and Break Fee |
(a) | any person (other than the Acquiror or any of its concert parties) publicly announces a Superior Offer (whether on a firm intention or a pre-conditional basis) for no less than 30% of the voting rights of the Company; | |
(b) | the Acquiror validly exercises the Matching Right and receives or is deemed to have received the Matching Offer Determination stating that the Acquiror has matched the Superior Offer; and | |
(c) | the Acquiror duly announces its firm intention to make the Offer. |
(I) | if a Competing Offer or an intention to make a Competing Offer is announced by a third party (whether or not such Competing Offer is pre-conditional) and: |
(A) | whether pursuant to their fiduciary obligations or otherwise, the Independent Directors recommend or announce their intention to recommend the Competing Offer over the Scheme or do not unequivocally recommend that Shareholders vote in favour of the Scheme; or | |
(B) | in the event that prior to the announcement of the Competing Offer or the intention to make a Competing Offer, the Independent Directors had recommended that Shareholders vote in favour of the Scheme, the Independent Directors withdraw such recommendation or announce their intention to withdraw such recommendation (provided that no Fee shall be payable under the circumstances described in thisParagraph 3.3(I) in respect of any withdrawal or announcement of intention to withdraw such recommendation unless, subsequent to such withdrawal or announcement of intention to withdraw, the Independent Directors recommend or announce their intention to recommend the Competing Offer over the Scheme or do not unequivocally recommend that Shareholders vote in favour of the Scheme), |
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(II) | if the Company breaches any of the applicable Material Obligations: |
(A) | prior to the date of the Court Meeting and Shareholders’ approval for the Scheme is not obtained; or | |
(B) | after Shareholders’ approval for the Scheme is obtained and the Scheme does not become effective by the Long-Stop Date due to any of the Scheme Conditions inParagraphs (d) and(e) ofAppendix 5 to the Scheme Document not being fulfilled other than as a result of the Company exercising its termination right as described underParagraph 3.3.3(ii) of the Company’s Letter to Shareholders in the Scheme Document; or |
(III) | if the Company exercises its right to enter into negotiations, discussions or otherwise entertains an Unsolicited Offer, and the Shareholders’ approval for the Scheme is not obtained. |
3.4 | Options |
3.5 | The GS Option |
4. | RATIONALE AND BENEFITS OF THE PROPOSED ACQUISITION AND FUTURE PLANS FOR THE COMPANY |
4.1 | Rationale and Benefits of the Proposed Acquisition |
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4.2 | Future Plans for the Group |
5. | GENERAL AND FINANCIAL INFORMATION RELATING TO THE ACQUIROR |
6. | GENERAL AND FINANCIAL INFORMATION RELATING TO THE COMPANY |
6.1 | There is no restriction in the Memorandum and Articles of the Company on the right to transfer any Company Shares which has the effect of requiring the holders of the Company Shares, before transferring them, to offer them for purchase to members of the Company or to any other person. |
6.2 | As at the Latest Practicable Date, save for the information on the Company which is publicly available (including, without limitation, the audited consolidated financial statements of the Group for FY2006, FY2007 and FY2008 and the unaudited financial statements of the Group for the three (3) and six (6) months ended 30 June 2009 summaries of which are disclosed inAppendix 4 to the Scheme Document) and save as disclosed in the Scheme Document, there has not been, within the knowledge of the Acquiror, any material change in the financial position or prospects of the Company since 31 December 2008 (being the date of the last balance sheet of the Company laid before the Shareholders in a general meeting). |
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7. | SPECIAL ARRANGEMENTS |
7.1 | Employment Arrangements |
7.2 | As at the Latest Practicable Date: |
(a) | Save as disclosed in the Scheme Document andParagraphs 7.1 and8 of this Letter, there is no agreement, arrangement or understanding between the Acquiror or any party acting in concert with it, and any of the present or recent Directors or the present or recent Shareholders, that has any connection with or is dependent on the Scheme. | |
(b) | Save as disclosed in the Scheme Document, there is no agreement, arrangement or understanding whereby any of the Scheme Shares acquired by the Acquiror pursuant to the Scheme will or may be transferred to any other persons. However, the Acquiror reserves the right to direct or transfer any of the Scheme Shares acquired by the Acquiror pursuant to the Scheme to ATIC or GLOBALFOUNDRIES, or a wholly-owned subsidiary of ATIC or GLOBALFOUNDRIES. | |
(c) | Save as disclosed in the Scheme Document, no payments or other benefits will be made or given to any Director or to any director of any corporation (which is by virtue of Section 6 of the Companies Act deemed to be related to the Company) as compensation for loss of office or otherwise in connection with the Scheme. | |
(d) | Save as disclosed in the Scheme Document andParagraphs 7.1 and8 of this Letter, no agreement or arrangement exists between the Acquiror and any of the Directors or any other person in connection with or conditional upon the outcome of the Scheme or otherwise connected with the Scheme. |
8. | IRREVOCABLE UNDERTAKINGS |
9. | INTERESTS AND DEALINGS IN SECURITIES |
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10. | IMPLEMENTATION OF THE SCHEME AND SETTLEMENT AND REGISTRATION PROCEDURES |
11. | AVAILABILITY OF FINANCIAL RESOURCES |
12. | MARKET QUOTATIONS |
13. | RESPONSIBILITY STATEMENT |
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(Letter from the Acquiror to Shareholders)
GENERAL AND FINANCIAL INFORMATION ON ATIC AND THE ACQUIROR
1. | INCORPORATION |
2. | DIRECTORS |
Name | Address | Designation | ||
Ibrahim Ajami | c/o PO Box 45005 Abu Dhabi United Arab Emirates | Director | ||
Samak Azar | c/o PO Box 45005 Abu Dhabi United Arab Emirates | Director |
3. | PRINCIPAL ACTIVITIES |
4. | SHARE CAPITAL |
5. | FINANCIAL INFORMATION ON ATIC AND THE ACQUIROR |
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6. | MARKET QUOTATIONS |
(a) | Transacted Prices |
Transacted | ||||||||||||||||
Volume of | ||||||||||||||||
Highest | Lowest | the | ||||||||||||||
Closing | Closing | Last | Company | |||||||||||||
Price | Price | Closing Price | Shares | |||||||||||||
(S$) | (S$) | (S$) | (’000) | |||||||||||||
Monthly Trades 2009 | ||||||||||||||||
March | 1.66 | 0.70 | 1.35 | 68,837 | ||||||||||||
April | 1.75 | 1.25 | 1.65 | 222,272 | ||||||||||||
May | 2.20 | 1.65 | 2.20 | 168,690 | ||||||||||||
June | 2.36 | 2.02 | 2.05 | 115,240 | ||||||||||||
July | 2.27 | 1.81 | 2.24 | 49,592 | ||||||||||||
August | 2.41 | 2.24 | 2.38 | 62,132 | ||||||||||||
September | 2.66 | 2.48 | 2.60 | 119,072 |
(b) | Highest and Lowest Prices |
(c) | Closing Prices |
(i) | 4 September 2009, the last Business Day prior to the date of the Announcement, was S$2.66 per Company Share; and | |
(ii) | the Latest Practicable Date was S$2.62 per Company Share. |
7. | DISCLOSURE OF INTERESTS IN SECURITIES AND DEALINGS |
(a) | As at the Latest Practicable Date, save for the Irrevocable Undertakings from the Undertaking Shareholders, none of the Acquiror, its directors, or any party acting in concert with the Acquiror for the purpose of the Scheme, has received any irrevocable undertaking to vote in favour of the Scheme at the Court Meeting prior to the posting of this Letter. Details of the Company Shares held by the Undertaking Shareholders are set out inParagraph 6 of the Explanatory Statement in the Scheme Document. | |
(b) | Save as disclosed in thisParagraph 7 of this Schedule A as at the Latest Practicable Date, or as at 29 September 2009 (being two (2) Business Days prior to the Latest Practicable |
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Date) in relation to Credit Suisse and such entities and branches within the Credit Suisse Group AG presumed to be acting in concert with the Acquiror (the “CS Entities”), none of the Acquiror, its directors, any party acting in concert with the Acquiror for the purpose of the Scheme, owns, controls or has agreed to acquire Company Shares or securities which carry voting rights in the Company, or instruments convertible into, rights to subscribe for or options in respect of such Company Shares or such securities. |
(c) | Save as set out below, as at the Latest Practicable Date, or as at 29 September 2009 (being two (2) Business Days prior to the Latest Practicable Date) in relation to the CS Entities, none of the Acquiror, its directors, any party acting in concert with the Acquiror for the purpose of the Scheme or the Undertaking Shareholders, has dealt for value in any Company Shares or securities which carry voting rights in the Company, or instruments convertible into, rights to subscribe for or options in respect of such Company Shares or such securities, during the period commencing three (3) months prior to the Announcement Date and ending on the Latest Practicable Date or 29 September 2009 (as the case may be): |
Price (US$) | Number of | Number of | ||||||||
per | Company | Company | ||||||||
Date of | Nature of | Company | Shares* | Shares* | ||||||
Name | Transaction | Transaction | Share* | Acquired | Sold | |||||
Credit Suisse Securities (USA) LLC | 20 July 2009 | Buy | 14.60 | 300 | — | |||||
21 July 2009 | Sell | 14.67 | — | 100 | ||||||
23 July 2009 | Sell | 15.86 | — | 100 | ||||||
23 July 2009 | Sell | 16.24 | — | 100 | ||||||
5 August 2009 | Buy | 15.41 | 500 | — | ||||||
6 August 2009 | Sell | 15.50 | — | 100 | ||||||
14 August 2009 | Sell | 15.88 | — | 300 | ||||||
14 August 2009 | Sell | 15.93 | — | 100 |
* | American Depositary Receipt(s) |
(d) | Save for the Irrevocable Undertakings from the Undertaking Shareholders, as at the Latest Practicable Date, or as at 29 September 2009 (being two (2) Business Days prior to the Latest Practicable Date) in relation to the CS Entities, none of the Acquiror, its directors, or any party acting in concert with the Acquiror for the purpose of the Scheme, has entered into any arrangement of the kind referred to in Note 7 on Rule 12 of the Code, including indemnity or option arrangements, or any agreement or understanding, formal or informal, of whatever nature, relating to (i) the Company Shares or securities carrying voting rights in the Company; (ii) securities carrying conversion or subscription rights into any of (i); or (iii) options in respect of (i) or (ii) which may be an inducement to deal or refrain from dealing in the aforesaid securities. |
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1. | DIRECTORS |
Name | Address | Description | ||
James A. Norling | 7239 N Desert Fairways Drive Paradise Valley Arizona 85253 United States of America | Director and Chairman | ||
Chia Song Hwee | 35 Greenbank Park Green Bank Park Singapore 589396 | Director, President and CEO | ||
Philip Tan Yuen Fah | 33 Namly Drive Shamrock Park Singapore 267447 | Director and Chairman of the Audit Committee | ||
Peter Seah Lim Huat | 45 Binjai Park Binjai Park Singapore 589845 | Director and Chairman of the ERCC | ||
Charles E. Thompson | 3750 E. Minton Place Mesa Arizona 85215 United States of America | Director | ||
Tay Siew Choon | 6 Third Avenue Singapore 266579 | Director | ||
Pasquale Pistorio | Via Marconi 19 23873 Missaglia Lecco Italy | Director | ||
Steven H. Hamblin | 9431 Windrush Drive Spring Texas 77379 United States of America | Director | ||
Maurizio Ghirga | Via Matteotti 102 21020 Casciago (Va) Italy | Director |
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2. | PRINCIPAL ACTIVITIES |
3. | DISCLOSURE OF SHAREHOLDINGS AND DEALINGS |
3.1 | Disclosures of Interests in Securities. |
3.1.1 | Interests in the Securities of the Company: |
(i) | As at the Latest Practicable Date, save as disclosed below, none of the Company Directors owns, controls or has agreed to acquire any Company Shares or Company Convertible Securities: |
(a) | Interests in Company Shares: |
Direct Interest | Deemed Interest | ||||||||||||||
Name of | No. of | No. of | |||||||||||||
Company | Company | Percentage | Company | Percentage | |||||||||||
No. | Director | Shares | (%) | Shares | (%) | ||||||||||
(1) | James A. Norling | 39,799 | n.m. | — | — | ||||||||||
(2) | Chia Song Hwee | 188,000 | 0.02 | — | — | ||||||||||
(3) | Philip Tan Yuen Fah | 5,351 | n.m. | — | — | ||||||||||
(4) | Peter Seah Lim Huat | 5,268 | n.m. | — | — | ||||||||||
(5) | Charles E. Thompson | 41,890 | n.m. | — | — | ||||||||||
(6) | Tay Siew Choon | 4,154 | n.m. | — | — | ||||||||||
(7) | Pasquale Pistorio | 652,684 | 0.07 | — | — | ||||||||||
(8) | Steven H. Hamblin | 13,422 | n.m. | — | — | ||||||||||
(9) | Maurizio Ghirga | 3,389 | n.m. | — | — | ||||||||||
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(b) | Interests in Options: |
No. of | ||||||||||||
Company | ||||||||||||
Name of | Shares | Exercise Price | ||||||||||
Company | comprised in | per Company | ||||||||||
No. | Director | Options | Share (S$) | Exercise Period | ||||||||
(1) | James A. Norling | 220,473 | S$7.10 to S$25.80 | 1 May 2002 to 31 August 2012 | ||||||||
(2) | Chia Song Hwee | 1,362,878 | S$4.78 to S$94.50 | 29 October 1999 to 31 August 2017 | ||||||||
(3) | Philip Tan Yuen Fah | 34,302 | S$7.10 to S$8.10 | 26 August 2006 to 31 August 2012 | ||||||||
(4) | Peter Seah Lim Huat | 34,302 | S$7.10 to S$8.10 | 26 August 2006 to 31 August 2012 | ||||||||
(5) | Charles E. Thompson | 24,878 | S$7.10 to S$8.10 | 26 August 2006 to 31 August 2012 | ||||||||
(6) | Tay Siew Choon | 24,878 | S$7.10 to S$8.10 | 26 August 2006 to 31 August 2012 | ||||||||
(7) | Pasquale Pistorio | 24,878 | S$7.10 to S$8.10 | 26 August 2006 to 31 August 2012 | ||||||||
(8) | Steven H. Hamblin | 15,831 | S$7.10 to S$8.10 | 25 August 2007 to 31 August 2012 | ||||||||
(9) | Maurizio Ghirga | 5,277 | S$7.10 | 31 August 2008 to 31 August 2012 | ||||||||
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(c) | Interests in RSUs: |
Name of | No. of | ||||||||
Company | Company Shares | ||||||||
No. | Director | comprised in RSUs | Vesting Period | ||||||
(1) | James A. Norling | 44,717 | 30 May 2010 to 7 August 2012 | ||||||
(2) | Chia Song Hwee | 229,522 | 30 May 2010 to 29 May 2012 | ||||||
(3) | Philip Tan Yuen Fah | 24,967 | 30 May 2010 to 7 August 2012 | ||||||
(4) | Peter Seah Lim Huat | 24,967 | 30 May 2010 to 7 August 2012 | ||||||
(5) | Charles E. Thompson | 20,585 | 30 May 2010 to 7 August 2012 | ||||||
(6) | Tay Siew Choon | 21,935 | 30 May 2010 to 7 August 2012 | ||||||
(7) | Pasquale Pistorio | 17,258 | 30 May 2010 to 7 August 2012 | ||||||
(8) | Steven H. Hamblin | 23,206 | 30 May 2010 to 7 August 2012 | ||||||
(9) | Maurizio Ghirga | 23,206 | 30 May 2010 to 7 August 2012 | ||||||
(d) | Interests in PSUs: |
Name of | No. of | ||||||||
Company | Company Shares | ||||||||
No. | Director | comprised in PSUs | Vesting Period | ||||||
(1) | James A. Norling | — | — | ||||||
(2) | Chia Song Hwee | 116,062 | 31 August 2010 to 29 May 2012 | ||||||
(3) | Philip Tan Yuen Fah | — | — | ||||||
(4) | Peter Seah Lim Huat | — | — | ||||||
(5) | Charles E. Thompson | — | — | ||||||
(6) | Tay Siew Choon | — | — | ||||||
(7) | Pasquale Pistorio | — | — | ||||||
(8) | Steven H. Hamblin | — | — | ||||||
(9) | Maurizio Ghirga | — | — | ||||||
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(ii) | As at the Latest Practicable Date, save as disclosed below and based on the Register of Substantial Shareholders maintained by the Company, none of the Substantial Shareholders has any interest, direct or indirect, in any Company Shares or Company Convertible Securities: |
Name of Substantial Shareholder | Direct Interest | Deemed Interest | ||||||||||
No. of Company Shares | Percentage (%) | No. of Company Shares | Percentage (%) | |||||||||
Temasek Holdings (Private) Limited | — | — | 586,752,688 | 62.28 | ||||||||
Singapore Technologies Semiconductors Pte Ltd | 586,752,688 | 62.28 | — | — | ||||||||
Dodge & Cox International Stock Fund | 74,293,836 | 7.89 | — | — | ||||||||
(iii) | As at the Latest Practicable Date, none of (a) the IFA, (b) entities or branches which are members of the Deutsche Bank AG group of companies and which are incorporated, established or registered in Singapore or Hong Kong (the “DB Related Entities”) and (c) funds whose investments are managed by the IFA or the DB Related Entities on a discretionary basis, owns, controls or has agreed to acquire any Company Shares or Company Convertible Securities. |
3.1.2 | Interests in the Securities of the Acquiror: |
(i) | As at the Latest Practicable Date, none of the Company or its subsidiaries owns, controls or has agreed to acquire any Acquiror Shares or Acquiror Convertible Securities. | |
(ii) | As at the Latest Practicable Date, none of the Company Directors owns, controls or has agreed to acquire any Acquiror Shares or Acquiror Convertible Securities. |
3.1.3 | Interests in the Securities of ATIC: |
(i) | As at the Latest Practicable Date, none of the Company or its subsidiaries owns, controls or has agreed to acquire any ATIC Shares or ATIC Convertible Securities. | |
(ii) | As at the Latest Practicable Date, none of the Company Directors owns, controls or has agreed to acquire any ATIC Shares or ATIC Convertible Securities. |
3.2 | Disclosure of Dealings in Securities. |
3.2.1 | Dealings in the Securities of the Company: |
(i) | Pursuant to the Company’s27-for-10 rights offering completed on 15 April 2009, the following Company Directors subscribed for, and were allocated, excess rights to subscribe for the following number of Company Shares or ADSs, as the case |
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may be, at the following prices: (a) Steven Hugh Hamblin, 5,000 ADSs at US$0.45 per ADS; (b) Charles E Thompson, 662 Company Shares at S$0.07 per Company Share, (c) Tay Siew Choon, 662 Company Shares at S$0.07 per Company Share, and (d) Philip Tan Yuen Fah, 829 Company Shares at S$0.07 per Company Share. Further, Pasquale Pistorio, who took up rights to subscribe for 4,000,000 Company Shares (out of his entitlement to subscribe for 6,750,000 Company Shares) sold rights to subscribe for 2,750,000 Company Shares. Save as disclosed above, none of the Company Directors has dealt for value in the Company Shares or Company Convertible Securities during the period commencing six months immediately preceding the Announcement Date and ending on the Latest Practicable Date. |
(ii) | None of (a) the IFA, (b) the DB Related Entities and (c) funds whose investments are managed by the IFA or the DB Related Entities on a discretionary basis, has dealt for value in any Company Shares or Company Convertible Securities during the six month period immediately preceding the Announcement Date and ending on the Latest Practicable Date. |
3.2.2 | Dealings in the Securities of the Acquiror: |
(i) | None of the Company or any of its subsidiaries has dealt for value in the Acquiror Shares or Acquiror Convertible Securities during the period commencing six months immediately preceding the Announcement Date and ending on the Latest Practicable Date. | |
(ii) | None of the Company Directors has dealt for value in the Acquiror Shares or Acquiror Convertible Securities during the period commencing six months immediately preceding the Announcement Date and ending on the Latest Practicable Date. |
3.2.3 | Dealings in the Securities of ATIC: |
(i) | None of the Company or any of its subsidiaries has dealt for value in the ATIC Shares or ATIC Convertible Securities during the period commencing six months immediately preceding the Announcement Date and ending on the Latest Practicable Date. | |
(ii) | None of the Company Directors has dealt for value in the ATIC Shares or ATIC Convertible Securities during the period commencing six months immediately preceding the Announcement Date and ending on the Latest Practicable Date. |
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4.1 | Summary of Annual Financial Performance. |
4.1.1 | Summary of Annual Financial Performance: The financial data tabulated below is extracted from, and should be read with, the audited consolidated financial statements of the Group for FY2006, FY2007 and FY2008 and the related notes thereto (which are incorporated by reference and copies of which are also available for inspection as mentioned inParagraph 15 of this Appendix): |
For the Years Ended December 31
In thousands (except per share data)
2006 | 2007 | 2008 | ||||||||||
Net revenue | $ | 1,414,525 | $ | 1,355,486 | $ | 1,661,120 | ||||||
Cost of revenue | (1,070,512 | ) | (1,095,830 | ) | (1,447,309 | ) | ||||||
Gross profit | 344,013 | 259,656 | 213,811 | |||||||||
Other revenue | 21,030 | 22,930 | 13,367 | |||||||||
OPERATING EXPENSES | ||||||||||||
Research and development | 152,756 | 159,764 | 177,866 | |||||||||
Sales and marketing | 55,007 | 58,013 | 69,469 | |||||||||
General and administrative | 42,558 | 39,648 | 43,053 | |||||||||
Other operating expenses, net | 13,766 | 13,030 | 10,138 | |||||||||
Total operating expenses, net | 264,087 | 270,455 | 300,526 | |||||||||
Equity in income of associated companies, net | 36,040 | 33,836 | 25,997 | |||||||||
Other income (loss), net | (2,689 | ) | (2,418 | ) | 2,905 | |||||||
Interest income | 44,591 | 27,031 | 15,379 | |||||||||
Interest expense and amortization of debt discount | (87,950 | ) | (60,325 | ) | (67,971 | ) | ||||||
Income (loss) before income tax | 90,948 | 10,255 | (97,038 | ) | ||||||||
Income tax expense (benefit) | 23,924 | (91,433 | ) | (4,459 | ) | |||||||
Net income (loss) | 67,024 | 101,688 | (92,579 | ) | ||||||||
Less: Accretion to redemption value of convertible redeemable preference shares | 9,476 | 9,663 | 10,042 | |||||||||
Net income (loss) available to ordinary shareholders | $ | 57,548 | $ | 92,025 | $ | (102,621 | ) | |||||
Basic net earnings (loss) per ordinary share | $ | 0.02 | $ | 0.04 | $ | (0.04 | ) | |||||
Diluted net earnings (loss) per ordinary share | $ | 0.02 | $ | 0.04 | $ | (0.04 | ) | |||||
Basic net earnings (loss) per ADS | $ | 0.23 | $ | 0.36 | $ | (0.40 | ) | |||||
Diluted net earnings (loss) per ADS | $ | 0.23 | $ | 0.35 | $ | (0.40 | ) | |||||
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2006 | 2007 | 2008 | ||||||||||
Number of ordinary shares used in computing: | ||||||||||||
Basic net earnings (loss) per ordinary share | 2,528,056 | 2,538,357 | 2,541,435 | |||||||||
Effect of dilutive securities | 6,009 | 330,260 | — | |||||||||
Diluted net earnings (loss) per ordinary share | 2,534,065 | 2,868,617 | 2,541,435 | |||||||||
Number of ADS used in computing: | ||||||||||||
Basic net earnings (loss) per ADS | 252,806 | 253,836 | 254,144 | |||||||||
Effect of dilutive securities | 601 | 33,026 | — | |||||||||
Diluted net earnings (loss) per ADS | 253,407 | 286,862 | 254,144 | |||||||||
Net income (loss) | $ | 67,024 | $ | 101,688 | $ | (92,579 | ) | |||||
Net unrealized gains (losses) on change in cash flow hedging fair values | (1,664 | ) | 1,824 | (705 | ) | |||||||
Share of cash flow hedging gains of associated companies | 9 | 1 | — | |||||||||
Reclassification of cash flow hedging (gains) losses into earnings | 435 | (1,917 | ) | 554 | ||||||||
Foreign currency translation | 568 | (33 | ) | (658 | ) | |||||||
Unrealized losses onavailable-for-sale securities | (11 | ) | (149 | ) | (1,872 | ) | ||||||
Reclassification of realized losses onavailable-for-sale securities into earnings | 2,350 | 835 | 1,287 | |||||||||
Other comprehensive income (loss), net | 1,687 | 561 | (1,394 | ) | ||||||||
Comprehensive income (loss), net | $ | 68,711 | $ | 102,249 | $ | (93,973 | ) | |||||
4.1.2 | Summary of Interim Financial Performance: The financial data tabulated below is extracted from, and should be read together with, the unaudited condensed consolidated financial statements of the Group for the financial period ended 30 June 2009 and the related notes thereto (which is incorporated by reference and a copy of which is also available for inspection as mentioned inParagraph 15 of this Appendix): |
In thousands (except per share data) | ||||||||||||||||
Three Months Ended | Six Months Ended | |||||||||||||||
June 30, | June 30, | |||||||||||||||
2008 | 2009 | 2008 | 2009 | |||||||||||||
Net revenue | $ | 457,562 | $ | 349,012 | $ | 845,792 | $ | 592,947 | ||||||||
Cost of revenue | 387,711 | 318,086 | 711,339 | 589,493 | ||||||||||||
Gross profit | 69,851 | 30,926 | 134,453 | 3,454 | ||||||||||||
Other revenue | 2,710 | 2,041 | 8,320 | 3,857 | ||||||||||||
OPERATING EXPENSES | ||||||||||||||||
Research and development | 42,845 | 45,786 | 88,290 | 93,794 | ||||||||||||
Sales and marketing | 17,836 | 13,633 | 35,428 | 26,476 | ||||||||||||
General and administrative | 11,164 | 10,487 | 21,958 | 21,085 | ||||||||||||
Other operating expenses, net | 1,268 | 5,581 | 3,752 | 8,533 | ||||||||||||
Total operating expenses, net | 73,113 | 75,487 | 149,428 | 149,888 |
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In thousands (except per share data) | ||||||||||||||||
Three Months Ended | Six Months Ended | |||||||||||||||
June 30, | June 30, | |||||||||||||||
2008 | 2009 | 2008 | 2009 | |||||||||||||
Equity in income of associated companies, net | 9,458 | 6,109 | 19,251 | 4,479 | ||||||||||||
Other income (loss), net | (787 | ) | 72 | 9,723 | 271 | |||||||||||
Interest income | 3,559 | 1,431 | 8,616 | 2,591 | ||||||||||||
Interest expense and amortization of debt discount | (17,803 | ) | (15,429 | ) | (33,437 | ) | (30,491 | ) | ||||||||
Loss before income tax | (6,125 | ) | (50,337 | ) | (2,502 | ) | (165,727 | ) | ||||||||
Income tax benefit | 49,542 | 8,827 | 48,310 | 9,992 | ||||||||||||
Net income (loss) | 43,417 | (41,510 | ) | 45,808 | (155,735 | ) | ||||||||||
Less: Net loss attributable to the noncontrolling interest in CSP | — | 2,126 | — | 17,578 | ||||||||||||
Net income (loss) attributable to Chartered | 43,417 | (39,384 | ) | 45,808 | (138,157 | ) | ||||||||||
Less: Accretion to redemption value of convertible redeemable preference shares | 2,498 | 2,596 | 4,973 | 5,168 | ||||||||||||
Net income (loss) available to ordinary shareholders of Chartered | $ | 40,919 | $ | (41,980 | ) | $ | 40,835 | $ | (143,325 | ) | ||||||
Basic net earnings (loss) per ordinary share* | $ | 0.11 | $ | (0.05 | ) | $ | 0.11 | $ | (0.26 | ) | ||||||
Diluted net earnings (loss) per ordinary share* | $ | 0.10 | $ | (0.05 | ) | $ | 0.10 | $ | (0.26 | ) | ||||||
Basic net earnings (loss) per ADS* | $ | 1.07 | $ | (0.50 | ) | $ | 1.07 | $ | (2.62 | ) | ||||||
Diluted net earnings (loss) per ADS* | $ | 0.96 | $ | (0.50 | ) | $ | 1.01 | $ | (2.62 | ) | ||||||
Number of ordinary shares (in millions) used in computing:* | ||||||||||||||||
Basic net earnings (loss) per ordinary share | 383.1 | 835.9 | 383.1 | 546.7 | ||||||||||||
Effect of dilutive securities | 69.0 | — | 68.8 | — | ||||||||||||
Diluted net earnings (loss) per ordinary share | 452.1 | 835.9 | 451.9 | 546.7 | ||||||||||||
Number of ADS (in millions) used in computing:* | ||||||||||||||||
Basic net earnings (loss) per ADS | 38.3 | 83.6 | 38.3 | 54.7 | ||||||||||||
Effect of dilutive securities | 6.9 | — | 6.9 | — | ||||||||||||
Diluted net earnings (loss) per ADS | 45.2 | 83.6 | 45.2 | 54.7 | ||||||||||||
Net income (loss) | $ | 43,417 | $ | (41,510 | ) | $ | 45,808 | $ | (155,735 | ) | ||||||
Other comprehensive income (loss): | ||||||||||||||||
Net unrealized gains (losses) on change in cash flow hedging fair values | (68 | ) | 10 | 44 | 447 | |||||||||||
Reclassification of cash flow hedging losses into earnings | 95 | 209 | 236 | 2 | ||||||||||||
Foreign currency translation | 57 | 201 | 89 | 3 | ||||||||||||
Unrealized gains (losses) onavailable-for-sale securities | (261 | ) | 88 | (1,341 | ) | 280 | ||||||||||
Reclassification of realized losses onavailable-for-sale securities into earnings | 842 | — | 842 | 365 | ||||||||||||
Other comprehensive income (loss), net | 665 | 508 | (130 | ) | 1,097 |
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In thousands (except per share data) | ||||||||||||||||
Three Months Ended | Six Months Ended | |||||||||||||||
June 30, | June 30, | |||||||||||||||
2008 | 2009 | 2008 | 2009 | |||||||||||||
Comprehensive income (loss), net | 44,082 | (41,002 | ) | 45,678 | (154,638 | ) | ||||||||||
Less: Comprehensive loss attributable to the noncontrolling interest in CSP | — | 2,106 | — | 17,535 | ||||||||||||
Comprehensive income (loss) attributable to Chartered | $ | 44,082 | $ | (38,896 | ) | $ | 45,678 | $ | (137,103 | ) | ||||||
* | As adjusted retroactively for the rights offering and the share consolidation — see Note 4 of the unaudited condensed consolidated financial statements for more details. |
4.2 | Statement of Assets and Liabilities. |
In thousands | ||||||||
(except per share data) | ||||||||
As of | ||||||||
December 31, | June 30, | |||||||
2008 | 2009 | |||||||
ASSETS | ||||||||
Cash and cash equivalents | $ | 524,501 | $ | 773,571 | ||||
Restricted cash | 69,560 | 65,127 | ||||||
Marketable securities | 950 | 1,230 | ||||||
Receivables, less allowances of $2,451 in 2008 and $2,400 in 2009 | 224,428 | 241,564 | ||||||
Inventories | 189,498 | 146,396 | ||||||
Other investments | 19,634 | 4,800 | ||||||
Other current assets | 19,840 | 19,347 | ||||||
Total current assets | 1,048,411 | 1,252,035 | ||||||
Investment in associated companies | 28,924 | 32,368 | ||||||
Technology licenses and other intangible assets, net | 48,178 | 39,560 | ||||||
Property, plant and equipment, net | 2,845,668 | 2,749,271 | ||||||
Other non-current assets | 53,992 | 54,266 | ||||||
Total assets | $ | 4,025,173 | $ | 4,127,500 | ||||
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In thousands | ||||||||
(except per share data) | ||||||||
As of | ||||||||
December 31, | June 30, | |||||||
2008 | 2009 | |||||||
LIABILITIES, CONVERTIBLE REDEEMABLE PREFERENCE SHARES AND EQUITY | ||||||||
Payables | $ | 311,264 | $ | 248,472 | ||||
Current installments of long-term debt and capital lease obligations | 163,232 | 164,659 | ||||||
Other current liabilities | 102,355 | 80,315 | ||||||
Total current liabilities | 576,851 | 493,446 | ||||||
Long-term debt and capital lease obligations, excluding current installments | 1,677,228 | 1,716,465 | ||||||
Other non-current liabilities | 61,801 | 53,148 | ||||||
Total liabilities | 2,315,880 | 2,263,059 | ||||||
Convertible redeemable preference shares | 265,879 | 271,047 | ||||||
Ordinary share capital | 2,706,244 | 3,010,862 | ||||||
Accumulated deficit | (1,208,166 | ) | (1,346,323 | ) | ||||
Accumulated other comprehensive loss | (54,664 | ) | (53,610 | ) | ||||
Total shareholders’ equity of Chartered | 1,443,414 | 1,610,929 | ||||||
Noncontrolling interest in CSP | — | (17,535 | ) | |||||
Total equity | $ | 1,443,414 | $ | 1,593,394 | ||||
Total liabilities, convertible redeemable preference shares and total equity | $ | 4,025,173 | $ | 4,127,500 | ||||
5.1 | No Other Material Changes. As at the Latest Practicable Date, save (i) as disclosed in this Scheme Document, (ii) as publicly announced on the SGX-ST and submitted to the SEC via a report onForm 6-K and (iii) for the costs and expenses incurred or to be incurred in connection with the Acquisition and the implementation of the Scheme, there are no known material changes in the financial position of the Company subsequent to the last published audited consolidated financial statements for FY2008. |
5.2 | Outlook. Shareholders’ attention is drawn to the Outlook, which is reproduced inAppendix 10 of this Scheme Document. |
5.3 | Unaudited Condensed Consolidated Financial Statements for the Financial Period Ended 30 September 2009. Shareholders’ attention is further drawn to the unaudited condensed consolidated financial statements of the Group for the financial period ended 30 September 2009 and the related notes thereto to be released by the Company to the SGX-ST and submitted to the SEC via a report onForm 6-K towards the end of October 2009 in line with the Company’s customary practice. |
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5.4 | Others. In light of the Acquisition, the Company will not be providing guidance for its fourth quarter ending 31 December 2009 and will also not host a conference call or web cast. Results for the third quarter ended 30 September 2009 are currently scheduled to be announced towards the end of October 2009 in line with the Company’s customary practice. Considering that the Company is in the midst of the Acquisition, in order to be able to provide fourth quarter guidance, it would need to make several assumptions and estimates which are dependent on whether and when the Acquisition will be completed. This can result in significant uncertainty while forecasting its results for the fourth quarter ending 31 December 2009 and the management of the Company has therefore decided not to provide such guidance. |
(b) | Basis of Presentation |
2006 | 2007 | 2008 | ||||||||||
Net losses not allocated to the minority shareholders of CSP according to their proportionate ownership | $ | 12,831 | $ | 5,396 | $ | 826 |
(c) | Cumulative Effect Adjustment |
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(d) | Use of Estimates |
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(m) | Technology Licenses and Other Intangible Assets |
Years ended December 31, | Year ended December 31, | |||
2006 and 2007 | 2008 | |||
Technology licenses | 3 to 10 years | 3 to 10 years | ||
Other intangible assets | — | 3 to 6 years |
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Years ended December 31, | Year ended December | |||
2006 and 2007 | 31, 2008 | |||
Buildings | 20 years (or, if shorter, the remaining period of the lease of the land on which the buildings are erected) | 20 years (or, if shorter, the remaining period of the lease of the land on which the buildings are erected) | ||
Mechanical and electrical installations | 10 years | 6 to 15 years | ||
Equipment and machinery | 5 years | 5 to 8 years | ||
Office and computer equipment | 2 to 5 years | 2 to 5 years |
(o) | Impairment of Long-Lived Assets, including Technology Licenses and Other Intangible Assets |
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2006 | 2007 | 2008 | ||||||||||||||||||||||
Basic | Diluted | Basic | Diluted | Basic | Diluted | |||||||||||||||||||
Net income (loss) available to ordinary shareholders | $ | 57,548 | 57,548 | $ | 92,025 | 92,025 | $ | (102,621 | ) | (102,621 | ) | |||||||||||||
Accretion to redemption value of convertible redeemable preference shares | — | — | — | 9,663 | — | — | ||||||||||||||||||
Net income (loss) available for per-share / ADS computation | $ | 57,548 | 57,548 | $ | 92,025 | 101,688 | $ | (102,621 | ) | (102,621 | ) | |||||||||||||
Per-share computation: | ||||||||||||||||||||||||
Weighted-average number of ordinary shares outstanding | 2,528,056 | 2,528,056 | 2,538,357 | 2,538,357 | 2,541,435 | 2,541,435 | ||||||||||||||||||
Dilutive effect of potential ordinary shares issuable from share-based awards | — | 6,009 | — | 5,116 | — | — | ||||||||||||||||||
Dilutive effect of potential ordinary shares issuable from conversion of convertible redeemable preference shares | — | — | — | 325,144 | — | — | ||||||||||||||||||
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2006 | 2007 | 2008 | ||||||||||||||||||||||
Basic | Diluted | Basic | Diluted | Basic | Diluted | |||||||||||||||||||
Weighted-average number of ordinary shares outstanding for per-share computation | 2,528,056 | 2,534,065 | 2,538,357 | 2,868,617 | 2,541,435 | 2,541,435 | ||||||||||||||||||
Per-ADS computation: | ||||||||||||||||||||||||
Weighted-average number of ordinary shares outstanding | 252,806 | 252,806 | 253,836 | 253,836 | 254,144 | 254,144 | ||||||||||||||||||
Dilutive effect of potential ordinary shares issuable from share-based awards | — | 601 | — | 512 | — | — | ||||||||||||||||||
Dilutive effect of potential ordinary shares issuable from conversion of convertible redeemable preference shares | — | — | — | 32,514 | — | — | ||||||||||||||||||
Weighted-average number of ordinary shares outstanding for per-ADS computation | 252,806 | 253,407 | 253,836 | 286,862 | 254,144 | 254,144 | ||||||||||||||||||
Net earnings (loss) per ordinary share | $ | 0.02 | 0.02 | $ | 0.04 | 0.04 | $ | (0.04 | ) | (0.04 | ) | |||||||||||||
Net earnings (loss) per ADS | $ | 0.23 | 0.23 | $ | 0.36 | 0.35 | $ | (0.40 | ) | (0.40 | ) |
i. | The exercise price or conversion price of the securities exceeded the average fair value of the Company’s share price; or | |
ii. | The total assumed proceeds under the treasury stock method resulted in negative incremental shares; or | |
iii. | The accretion to redemption value of convertible securities per ordinary share obtainable on conversion was higher than the basic net earnings per ordinary share, as adjusted for the effect of any potentially dilutive securities which were more dilutive than the convertible securities; or | |
iv. | The conditions for the vesting of the performance share units were not expected to be met; or |
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v. | The Company had net losses. |
December 31, | ||||||||||||
2006 | 2007 | 2008 | ||||||||||
Convertible redeemable preference shares | 325,144 | — | 325,144 | |||||||||
Call options with Goldman Sachs International (“GS”) | 214,800 | 214,800 | 214,800 | |||||||||
Employee share options | 96,479 | 94,086 | 105,478 | |||||||||
Restricted share units | — | — | 11,328 | |||||||||
Performance share units | — | 2,316 | 4,719 |
7.1 | Save as disclosed below inParagraph 7.2 of this Appendix, as at the Latest Practicable Date, there has been no change in the accounting policies of the Group since 31 December 2008, the date to which the last audited consolidated financial statements of the Group were drawn up, which would result in a material variation in the figures provided in such audited consolidated financial statements. |
7.2 | On 1 January 2009, the Group adopted Financial Accounting Standards Board Accounting Standards Codification810-10 (the “ASC810-10”) on non-controlling interests in consolidated financial statements. Under the ASC810-10, accounting and reporting for minority interests are recharacterized as non-controlling interests and classified as a component of equity. The ASC810-10 also establishes reporting requirements that provide sufficient disclosures to clearly identify and distinguish between the interests of the parent and the interests of the non-controlling owners. Supplemental pro forma financial information is presented below as if the ASC810-10 was not adopted on 1 January 2009. |
Six Months Ended | ||||
June 30, 2009 | ||||
Presented in Thousands | ||||
Pro forma net loss attributable to the Company | 155,735 | |||
Pro forma net loss available to Shareholders | 160,903 | |||
Pro forma basic net loss per Company Share | 0.29 | |||
Pro forma diluted net loss per Company Share | 0.29 | |||
Pro forma basic net loss per ADS | 2.94 | |||
Pro forma diluted net loss per ADS | 2.94 |
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8.1 | Issued Share Capital. As at the Latest Practicable Date, the issued share capital of the Company is: |
8.1.1 | S$4,866,230,884.158, in respect of 942,060,579 Company Shares (including Company Shares represented by ADSs); and | |
8.1.2 | US$239,365,854.00, in respect of 28,350 CRPS, convertible into 68,810,679 Company Shares at the prevailing US$4.12 conversion price. |
8.2 | Shares Issued since 31 December 2008. |
8.2.1 | Company Shares: |
(i) | As at 31 December 2008, there were 2,543,199,909 Company Shares in issue. | |
(ii) | Between 1 January 2009 and 15 May 2009, 6,871,143,394 Company Shares were issued for cash by the Company pursuant to (a) a rights issue undertaken by the Company and (b) the issuance of Company Shares to certain of the Company’s employees under the Company’s Employee Share Purchase Plan 2004. Accordingly, as at 15 May 2009, there were 9,414,343,303 Company Shares in issue. | |
(iii) | Pursuant to the share consolidation exercise undertaken by the Company, every 10 Company Shares were consolidated into one Company Share, fractions disregarded, with effect from 5:00 p.m. on 20 May 2009. Accordingly, immediately upon such share consolidation, the Company had 941,433,787 Company Shares in issue. | |
(iv) | From 20 May 2009 up to the Latest Practicable Date, no Company Shares were issued for cash by the Company pursuant to the exercise of Options under the ESOP, and 590,918 Company Shares and 35,874 Company Shares were issued by the Company pursuant to the vesting of RSUs and PSUs, respectively. |
8.2.2 | CRPS: Since 31 December 2008, no further CRPS were issued by the Company. |
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8.3 | Company Convertible Securities. As at the Latest Practicable Date and save as disclosed below, there were no outstanding Company Convertible Securities: |
8.3.1 | Options: As at the Latest Practicable Date, there were outstanding Options to subscribe for an aggregate of 14,479,461 new Company Shares granted under the ESOP, details of which are as follows: |
No. of Company | Exercise Price per | ||||||||
Shares comprised | Company Share | ||||||||
Date of Grant | Exercise Period | in Options | (S$) | ||||||
29-Oct-99 | 29-Oct-99 to 29-Oct-09 | 222,445 | $19.00 | ||||||
29-Oct-99 | 29-Apr-00 to 29-Oct-09 | 42,412 | $19.00 | ||||||
29-Oct-99 | 29-Oct-00 to 29-Oct-09 | 21,597 | $19.00 | ||||||
06-Apr-00 | 06-Apr-01 to 06-Apr-10 | 828,380 | $94.50 | ||||||
03-Oct-00 | 03-Oct-01 to 03-Oct-10 | 1,126,977 | $67.20 | ||||||
28-Mar-01 | 28-Mar-02 to 28-Mar-11 | 664,578 | $26.90 | ||||||
15-Jun-01 | 15-Jun-02 to 15-Jun-11 | 139,351 | $28.60 | ||||||
15-Aug-01 | 15-Aug-02 to 15-Aug-11 | 628,219 | $28.30 | ||||||
18-Jan-02 | 18-Jan-03 to 18-Jan-12 | 13,255 | $27.00 | ||||||
22-Feb-02 | 22-Feb-03 to 22-Feb-12 | 625,601 | $23.00 | ||||||
01-May-02 | 01-May-02 to 01-May-12 | 176,746 | $25.80 | ||||||
30-Aug-02 | 30-Aug-03 to 30-Aug-12 | 1,212,299 | $12.40 | ||||||
20-Jan-03 | 20-Jan-04 to 20-Jan-13 | 22,615 | $6.70 | ||||||
28-Feb-03 | 28-Feb-04 to 28-Feb-13 | 619,880 | $4.78 | ||||||
07-Apr-03 | 07-Apr-04 to 07-Apr-13 | 37,695 | $4.58 | ||||||
29-Aug-03 | 29-Aug-04 to 29-Aug-13 | 1,387,092 | $7.30 | ||||||
27-Feb-04 | 27-Feb-05 to 27-Feb-14 | 1,492,713 | $11.30 | ||||||
30-Jul-04 | 30-Jul-04 to 30-Jul-14 | 281,540 | $6.80 | ||||||
26-Aug-05 | 26-Aug-06 to 26-Aug-10 | 131,896 | $7.70 | ||||||
26-Aug-05 | 26-Aug-06 to 26-Aug-15 | 1,350,988 | $7.70 | ||||||
03-Oct-05 | 03-Oct-06 to 03-Oct-15 | 150,782 | $7.70 | ||||||
26-Oct-05 | 26-Oct-06 to 26-Oct-15 | 15,076 | $7.10 | ||||||
13-Feb-06 | 13-Feb-07 to 13-Feb-16 | 30,156 | $8.90 | ||||||
27-Jun-06 | 27-Jun-07 to 27-Jun-16 | 30,156 | $9.30 | ||||||
10-Jul-06 | 10-Jul-07 to 10-Jul-16 | 12,060 | $9.10 | ||||||
21-Jul-06 | 21-Jul-07 to 21-Jul-16 | 9,044 | $8.20 | ||||||
25-Aug-06 | 25-Aug-07 to 25-Aug-11 | 154,334 | $8.10 | ||||||
25-Aug-06 | 25-Aug-07 to 25-Aug-16 | 1,701,856 | $8.10 | ||||||
03-Oct-06 | 03-Oct-07 to 03-Oct-16 | 30,156 | $7.80 | ||||||
05-Feb-07 | 05-Feb-08 to 05-Feb-17 | 15,076 | $9.90 | ||||||
02-Apr-07 | 02-Apr-08 to 02-Apr-17 | 15,076 | $9.70 | ||||||
02-Jul-07 | 02-Jul-08 to 02-Jul-17 | 18,092 | $9.00 | ||||||
10-Aug-07 | 10-Aug-08 to 10-Aug-17 | 9,044 | $7.50 | ||||||
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No. of Company | Exercise Price per | ||||||||
Shares comprised | Company Share | ||||||||
Date of Grant | Exercise Period | in Options | (S$) | ||||||
31-Aug-07 | 31-Aug-08 to 31-Aug-12 | 74,095 | $7.10 | ||||||
31-Aug-07 | 31-Aug-08 to 31-Aug-17 | 1,005,751 | $7.10 | ||||||
24-Sep-07 | 24-Sep-08 to 24-Sep-17 | 6,028 | $7.10 | ||||||
24-Oct-07 | 24-Oct-08 to 24-Oct-17 | 7,536 | $7.10 | ||||||
16-May-08 | 16-May-09 to 16-May-18 | 150,780 | $6.11 | ||||||
10-Jul-08 | 10-Jul-09 to 10-Jul-18 | 6,028 | $4.58 | ||||||
21-Jul-08 | 21-Jul-09 to 21-Jul-18 | 4,520 | $4.65 | ||||||
24-Oct-08 | 24-Oct-09 to 24-Oct-18 | 7,536 | $1.73 | ||||||
Total | — | 14,479,461 | — | ||||||
8.3.2 | RSUs: As at the Latest Practicable Date, there were 3,791,383 Company Shares comprised in outstanding RSUs, details of which are as follows: |
No. of Company Shares | ||||||
Date of Grant | comprised in RSUs | Vesting Period | ||||
31-Aug-07 | 176,708 | 31-Aug-10 | ||||
30-May-08 | 824,030 | 30-May-10 to 30-May-11 | ||||
29-May-09 | 2,629,525 | 29-May-10 to 29-May-12 | ||||
07-Aug-09 | 161,120 | 07-Aug-10 to 07-Aug-12 | ||||
Total | 3,791,383 | — | ||||
8.3.3 | PSUs: As at the Latest Practicable Date, there were 979,754 Company Shares comprised in outstanding PSUs, details of which are as follows: |
Date of Grant | No. of Company Shares comprised in PSUs | Vesting Period | ||||
31-Aug-07 | 282,106 | 31-Aug-10 | ||||
30-May-08 | 357,791 | 30-May-11 | ||||
29-May-09 | 339,857 | 29-May-12 | ||||
Total | 979,754 | — | ||||
8.3.4 | GS Option: As at the Latest Practicable Date, there were 32,388,322 Company Shares comprised in the GS Option, details of which are as follows: |
Exercise Price per | |||||||||
No. of Company | Company Share as | ||||||||
Shares under GS | at the Latest Practicable | ||||||||
Date of Grant | Exercise Period | Option | Date (US$) | ||||||
29 March 2006 | 29 March 2007 to 29 March 2011 | 32,388,322 | 9.338 | ||||||
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8.3.5 | CRPS: As at the Latest Practicable Date, there were 28,350 CRPS convertible into 68,810,679 Company Shares, details of which are as follows: |
No. of Company | |||||||||
Shares upon | Conversion Price | ||||||||
Date of Issue | Conversion Period | conversion of CRPS | per Company Share (US$) | ||||||
17 August 2005 | 26 September 2005 to 6 August 2010 | 68,810,679 | 4.12 | ||||||
8.4 | Rights and Privileges of Shareholders. The rights and privileges of Shareholders in respect of voting, dividend and capital are stated in the Articles and are reproduced inParagraph 1 ofAppendix 9 of this Scheme Document. |
8.5 | Rights and Privileges of Preference Share Holders. The rights and privileges of Preference Share Holders in respect of voting, dividend and capital are stated in the Articles of Association of the Company and are reproduced inParagraph 2 ofAppendix 9 of this Scheme Document. |
9. | MATERIAL LITIGATION |
10. | MATERIAL CONTRACTS WITH INTERESTED PERSONS |
11. | DIRECTORS’ SERVICE CONTRACTS |
11.1 | Directors’ Service Contracts. Save as disclosed below, as at the Latest Practicable Date, there are no (i) service contracts between any director or proposed director with the Company or any if its subsidiaries with more than 12 months to run, which the employing company cannot, within the next 12 months, terminate without payment of compensation or (ii) service contracts entered into or amended between any director or proposed director of the Company or any of its subsidiaries during the period commencing six months immediately preceding the Announcement Date and ending on the Latest Practicable Date. |
11.2 | Transaction Bonus. Chia Song Hwee, the President, the CEO and a director of the Company shall be entitled to a transaction bonus of S$3.5 million, payable within 30 days following the Effective Date, subject to (i) the Scheme becoming effective and binding or (ii) his employment not being terminated by the Company for cause or his not having tendered his notice of resignation, each on or before the Effective Date. |
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12. | ARRANGEMENTS AFFECTING DIRECTORS |
12.1 | No Payment or Benefit to Directors. As at the Latest Practicable Date, save as disclosed in Paragraph 11.2 of this Appendix, there is no agreement, arrangement or understanding for any payment or other benefit to be made or given to any Director (or to any director of any corporation which by virtue of Section 6 of the Companies Act is deemed to be related to the Company) as compensation for loss of office or otherwise in connection with the Scheme. |
12.2 | No Agreement in Connection with or Conditional upon Outcome of the Scheme. As at the Latest Practicable Date, save for the Implementation Agreement, the Irrevocable Undertakings, the GLOBALFOUNDRIES Employment Agreement, and as disclosed in Paragraph 11.2 of this Appendix, there is no agreement, arrangement or understanding between (i) any of the Directors and (ii) any other person in connection with or conditional upon the outcome of the Scheme. |
12.3 | Material Contracts with Directors. As at the Latest Practicable Date, save for the GLOBALFOUNDRIES Employment Agreement and as disclosed in Paragraph 11.2 of this Appendix, there are no material contracts entered into by the Company or any of its subsidiaries in which any Director has a material personal interest, whether direct or indirect. |
13. | GENERAL |
13.1 | Costs and Expenses. In the event that the Scheme does not become effective and binding for any reason, the costs and expenses incurred by the Company in connection with the Acquisition and the Scheme will be borne by the Company, save as otherwise agreed between the Parties in the Implementation Agreement. |
13.2 | Consents. |
13.2.1 | FA: Morgan Stanley and Citi, the FAs, have each given and have each not withdrawn its written consent to the issue of this Scheme Document with the inclusion of the Fairness Opinion issued by it, its name, and all references to its name and the Fairness Opinion, in the form and context in which they appear in this Scheme Document, provided that such consent by each of the FAs, to the inclusion of the respective Fairness Opinion in the Scheme Document, shall not be construed as or deemed to amend, modify, revise or otherwise vary the terms on which the Fairness Opinions are given. | |
13.2.2 | IFA: Deutsche Bank, the IFA, has given and has not withdrawn its written consent to the issue of this Scheme Document with the inclusion of its name, the IFA’s Letter on the Scheme, the IFA’s Letter on the Outlook and all references to its name, in the form and context in which they appear in this Scheme Document. | |
13.2.3 | Auditors: KPMG LLP, the Auditors, have given and have not withdrawn their written consent to the issue of this Scheme Document with the inclusion herein of their name and all references to their name and the Auditors’ Letter on the Outlook in the form and context in which they appear in this Scheme Document. A written consent under the Code is different from a consent filed with the SEC under Section 7 of the Securities Act which is applicable only to transactions involving securities registered under the Securities Act. As the Scheme will not result in any new securities being registered in the U.S. under the Securities Act, the Auditors have not filed a consent under Section 7 of the Securities Act. |
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14. | INCORPORATION BY REFERENCE |
14.1 | The SEC allows the Company to “incorporate by reference” into this Scheme Document the information in documents the Company files with the SEC. This means that the Company can disclose important information to you by referring you to those documents. Each document incorporated by reference is current only as at the date of such document, and the incorporation by reference of such documents shall not create any implication that there has been no change in the Company’s affairs since the date thereof or that the information contained therein is current as at any time subsequent to its date. The information incorporated by reference is considered to be a part of this Scheme Document and should be read with the same care. When the Company updates the information contained in documents that have been incorporated by reference by making future filings with the SEC, the information incorporated by reference in this Scheme Document is considered to be automatically updated and superseded. In other words, in the case of a conflict or inconsistency between information contained in this Scheme Document and information incorporated by reference into this Scheme Document, you should rely on the information contained in the document that was filed later. The Company incorporates by reference the documents listed below: |
14.1.1 | the Company’s annual report onForm 20-F for FY2008 filed with the SEC on 27 February 2009, including the Company’s Memorandum and Articles of Association incorporated by reference as Exhibit 1 thereof; and | |
14.1.2 | the Company’s report onForm 6-K submitted to the SEC on 27 February 2009, 7 May 2009, 11 August 2009 and 24 September 2009. |
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15. | DOCUMENTS AVAILABLE FOR INSPECTION |
15.1 | Copies of the following documents are available for inspection at the registered office of the Company at 60 Woodlands Industrial Park D Street 2 Singapore 738406 during normal business hours from the date of this Scheme Document up to the Effective Date: |
15.1.1 | the Memorandum and Articles of Association of the Company; | |
15.1.2 | the Company’s annual report onForm 20-F for FY2006, FY2007 and FY2008; | |
15.1.3 | the unaudited consolidated financial statements of the Group for the financial period ended 30 June 2009 and the related notes thereto; | |
15.1.4 | the Implementation Agreement; | |
15.1.5 | the Irrevocable Undertakings; and | |
15.1.6 | the letters of consent referred to inParagraph 13.2 of this Appendix. |
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(a) | Regulatory Approvals: prior to the first application to the Court for an order to convene the Court Meeting, the following Regulatory Approvals having been obtained, and not having been withdrawn or revoked (if applicable) on or before the Record Date: |
(i) | confirmation from the SIC that Rules 14, 15, 16, 17, 20.1, 21, 22, 28, 29 and 33.2 and note 1(b) to Rule 19 of the Code shall not apply to the Scheme; and | |
(ii) | theapproval-in-principle from the SGX-ST of the Scheme, the Scheme Document and for the proposed delisting of the Company from the SGX-ST; |
(b) | Authorisations: in addition to the approvals mentioned in Clause 4.1(a): |
(i) | in relation to BidCo, all authorisations, consents, clearances, permissions and approvals as are necessary or required by BidCo under any and all Applicable Laws, from all relevant Governmental Authorities for or in respect of the Acquisition and the implementation of the Scheme; and | |
(ii) | in relation to the Company, all authorisations, consents, clearances, permissions and approvals as are necessary or required by the Company under any and all Applicable Laws from all relevant Governmental Authorities for or in respect of the Acquisition and the implementation of the Scheme, |
(c) | Court Meeting: the approval of the Scheme having been granted by the Shareholders at the Court Meeting in compliance with the requirements of Section 210(3) of the Companies Act; |
(d) | Court Order: the grant of the Court Order by the Court and such Court Order having become final; |
(e) | ACRA Lodgement: the lodgement and registration of the Court Order with ACRA pursuant to Section 210(5) of the Companies Act; |
(f) | Anti-trust Approvals: |
(i) | approval or clearance of the Acquisition or, if applicable, the Overall Transaction, having been granted by the competent competition authorities pursuant to the merger control laws |
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of Austria, China, Germany and South Korea (together with such laws and applicable merger control laws of the United States, hereinafter collectively referred to as the “Antitrust Laws”), and such approvals or clearances not having been withdrawn or revoked (if applicable) on or before the Record Date; or |
(ii) | if either the U.S. Federal Trade Commission (“FTC”) or Antitrust Division of the U.S. Department of Justice (“DOJ”) conducts an investigation or review of the Acquisition or the Overall Transaction, then neither the FTC (by (I) the Commission or the Secretary or (II) the Director of the Bureau of Competition and the Director of the Bureau of Economics) nor the DOJ (by (A) the Deputy Assistant Attorney General for Merger and the Deputy Assistant Attorney General for Economics or (B) the Assistant Attorney General) shall have communicated in writing to either ATIC or BidCo and the Company to cease and abstain from consummating the Acquisition or the Overall Transaction on or before the Record Date; or | |
(iii) | if the European Commission for any reason (including in response to a written request by ATIC, BidCo or GLOBALFOUNDRIES for guidance) reviews all or any aspect of the Overall Transaction, a Head of Unit or official of higher rank in the Directorate General for Competition of the European Commission shall not have given an unambiguous and unqualified statement in writing to BidCo by 5 November 2009 that, in the view of the European Commission’s legal services or in the view of the European Commission, the Overall Transaction fails to constitute a “concentration” within the meaning of Council Regulation (EC) No 139/2004 of 20 January 2004 on the control of concentrations between undertakings (the “EC Merger Regulation”); provided that: |
(A) | the Company, or with respect to matters that BidCo considers to be of a sensitive nature, the Company’s legal counsel, has had an opportunity to review and approve such request, review and approve (in all cases, such review and approval by the Company or the Company’s legal counsel not be unreasonably withheld or delayed) any subsequent communications, and participate in any oral communications to the extent practicable and reasonable; and | |
(B) | in the event this Clause 4.1(f)(iii) is not satisfied, BidCo will take all steps necessary including amending the management and operating agreement in connection with the Overall Transaction or otherwise, to render the Overall Transaction a “concentration” within the meaning of the EC Merger Regulation by the Record Date, whereupon this Clause 4.1(f)(iii) shall be deemed to be satisfied; provided that this Clause 4.1(f)(iii) shall not require BidCo to take any action that will result in (I) a breach under the Relevant Agreement; or (II) loss of GLOBALFOUNDRIES’ rights under the Relevant Agreement; or (III) GLOBALFOUNDRIES to no longer be deemed a “subsidiary” of the Relevant Person under the Relevant Agreement; |
(g) | No Legal or Regulatory Restraint: between the date of this Agreement and up to the Record Date, no injunction or other order, legal or regulatory restraint, prohibition or condition preventing the consummation of the Acquisition or the implementation of the Scheme (or the proposed transactions relating to the Scheme) or the consummation of the Overall Transaction having been issued by any Governmental Authority or by any court of competent jurisdiction, and remaining in effect as at the Record Date; |
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(h) | No Prescribed Occurrence: between the date of this Agreement and up to the Record Date, no Prescribed Occurrence: |
(i) | in relation to the Company (or where applicable, any other Group Company), save for the Permitted Events; or | |
(ii) | in relation to BidCo, |
(i) | No Termination: this Agreement not having been terminated pursuant to Clause 7; |
(j) | The Company Warranties and Covenants: |
(i) (A) | the Company Warranties that are qualified as to materiality being true and correct in all respects and not misleading in any respect; and |
(B) | the Company Warranties that are not qualified as to materiality being true and correct in all material respects and not misleading in any material respect, |
(ii) | the Company having, as of the Record Date, performed and complied in all material respects with all covenants and agreements contained in this Agreement which are required to be performed by or complied with by it, on or prior to the Record Date; |
(k) | The BidCo Warranties and Covenants: |
(i) (A) | the BidCo Warranties that are qualified as to materiality being true and correct in all respects and not misleading in any respect; and |
(B) | the BidCo Warranties that are not qualified as to materiality being true and correct in all material respects and not misleading in any material respect, |
(ii) | BidCo having, as of the Record Date, performed and complied in all material respects with all covenants and agreements contained in this Agreement which are required to be performed by or complied with by it, on or prior to the Record Date; |
(l) | No Material Adverse Event: none of the following events, matters or circumstances (“Material Adverse Event”) having occurred between the date of this Agreement and the Record Date: |
(i) | a diminution in the Company’s consolidated total equity (“TE”) (calculated on the same basis as the calculation for the Company’s TE for the financial period ended 30 June 2009 as reflected in the Unaudited HY1 2009 Financial Statements) to an amount less than US$1,400 million: |
(I) | as at 30 November 2009 (the “1st Test Date”), as reflected in the monthly consolidated management accounts of the Company for the financial period ending 30 November 2009 and as certified in writing by the Chief Financial Officer of the Company; or |
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(II) | as at 31 December 2009 (the “2nd Test Date”), as reflected in the unaudited consolidated financial statements of the Company for the full financial year ending 31 December 2009 (the “Full-Year Financial Statements”) and as certified in writing by the Chief Financial Officer of the Company, |
(A) | TE shall be tested: |
(1) | once only, either as of the 1st Test Date or the 2nd Test Date; | |
(2) | as of the 1st Test Date if the Record Date is set between 8 December 2009 and 30 December 2009 (both dates inclusive), provided further that, if but for this paragraph (A)(2) the Record Date could be set earlier than 8 December 2009, the Company shall set the Record Date to fall between 8 December 2009 and 30 December 2009 (both dates inclusive) so as to enable TE to be tested as of the 1st Test Date and the certificate referred to in paragraph (C) below to be delivered; and | |
(3) | as of the 2nd Test Date if the Record Date is set on or after 8 January 2010, provided further that, if but for this paragraph (A)(3) the Record Date could be set earlier than 8 January 2010 (but only on or after the 2nd Test Date), the Company shall set the Record Date to fall on or after 8 January 2010 so as to enable TE to be tested as of the 2nd Test Date and the certificate referred to in paragraph (C) below to be delivered; |
(B) | any diminution or increase in the Company’s TE arising from (1) currency translations (during the relevant period) attributable only to the difference between the Functional Currency of any Group Company and the Presentation Currency of the Company, (2) any fixed asset impairment charge or fixed asset write-off that any Group Company is required to recognise under U.S. GAAP during the period commencing on 1 July 2009 and ending on the 1st Test Date or the 2nd Test Date, as the case may beand/or (3) the fees, commissions, costs and expenses incurred or accrued by the Group in relation to, or in connection with, the Acquisition and the Scheme not exceeding an aggregate amount agreed between the Parties as at the date of this Agreement, shall each not be taken into account; and | |
(C) | if the Chief Financial Officer of the Company does not deliver his certification in writing on or prior to 10 December 2009 (in the case of paragraph (A)(2) above) or, as the case may be, on or prior to 10 January 2010 (in the case of paragraph (A)(3) above), then the diminution in the Company’s consolidated TE to an amount less than US$1,400 million shall be deemed to have occurred; |
(ii) | the net revenue for the Group (excluding the net revenue of SMP and calculated on the same basis as the calculation for the Company’s net revenue for the financial year ended 31 December 2008 as reported in the Company’s annual report onForm 20-F dated 27 February 2009) (“net revenue”) being: |
(1) | less than US$550 million for the period commencing 1 July 2009 and ending 30 November 2009 (the “1st Test Period”), as reflected in the monthly consolidated management accounts of the Company for the financial period |
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ending 30 November 2009 and as certified in writing by the Chief Financial Officer of the Company; or |
(2) | less than US$625 million for the period commencing 1 July 2009 and ending 31 December 2009 (the “2nd Test Period”), as reflected in the Full-Year Financial Statements and as certified in writing by the Chief Financial Officer of the Company, |
(A) | net revenue for the Group shall be tested: |
(1) | once only, either with respect to the 1st Test Period or the 2nd Test Period; | |
(2) | with respect to the 1st Test Period if the Record Date is set between 8 December 2009 and 30 December 2009 (both dates inclusive), provided further that, if but for this paragraph (A)(2) the Record Date could be set earlier than 8 December 2009, the Company shall set the Record Date to fall between 8 December 2009 and 30 December 2009 (both dates inclusive) so as to enable net revenue to be tested with respect to the 1st Test Period and the certificate referred to in paragraph (B) below to be delivered; and | |
(3) | with respect to the 2nd Test Period if the Record Date is set on or after 8 January 2010, provided further that, if but for this paragraph (A)(3) the Record Date could be set earlier than 8 January 2010 (but only on or after the 2nd Test Date), the Company shall set the Record Date to fall on or after 8 January 2010 so as to enable net revenue to be tested with respect to the 2nd Test Period and the certificate referred to in paragraph (B) below to be delivered; and |
(B) | if the Chief Financial Officer of the Company does not deliver his certification in writing on or prior to 10 December 2009 (in the case of paragraph (A)(2) above) or, as the case may be, on or prior to 10 January 2010 (in the case of paragraph (A)(3) above), then the net revenue for the Group shall be deemed be less than the applicable amount set out in this Clause 4.1(l)(ii)(I) or 4.1(l)(ii)(II), as the case may be; |
(iii) | a reduction of more than 15% in the value of orders (as defined below): |
(I) | for the 1st Test Period (as compared against the corresponding period commencing 1 July 2008 and ended 30 November 2008 for the previous financial year ended 31 December 2008), as certified in writing by the Chief Financial Officer of the Company; or |
(II) | for the 2nd Test Period (as compared against the corresponding period commencing 1 July 2008 and ended 31 December 2008) for the previous financial year ended 31 December 2008, as certified in writing by the Chief Financial Officer of the Company, |
(A) | value of orders shall be tested: |
(1) | once only, either with respect to the 1st Test Period or the 2nd Test Period; |
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(2) | with respect to the 1st Test Period if the Record Date is set between 8 December 2009 and 30 December 2009 (both dates inclusive), provided further that, if but for this paragraph (A)(2) the Record Date could be set earlier than 8 December 2009, the Company shall set the Record Date to fall between 8 December 2009 and 30 December 2009 (both dates inclusive) so as to enable value of orders to be tested with respect to the 1st Test Period and the certificate referred to in paragraph (B) below to be delivered; and | |
(3) | with respect to the 2nd Test Period if the Record Date is set on or after 8 January 2010, provided further that, if but for this paragraph (A)(3) the Record Date could be set earlier than 8 January 2010 (but only on or after the 2nd Test Date), the Company shall set the Record Date to fall on or after 8 January 2010 so as to enable value of orders to be tested with respect to the 2nd Test Period and the certificate referred to in paragraph (B) below to be delivered; |
(B) | if the Chief Financial Officer of the Company does not deliver his certification in writing on or prior to 10 December 2009 (in the case of paragraph (A)(2) above) or, as the case may be, on or prior to 10 January 2010 (in the case of paragraph (A)(3) above) , then a reduction of more than 15% in value of the orders shall be deemed to have occurred; and | |
(C) | “value of orders” shall be determined by reference to the aggregate purchase orders received and accepted by the Group during the relevant period in question and calculated on the same basis as the calculation for the corresponding period in question; or |
(iv) | there being no material disruption to the operations of the Group, and for the purposes of thissub-Clause, “material disruption to the operations of the Group” means an event, occurrence or action (each referred to as the “Disruption Event”) which, in the opinion of the Independent Expert (acting as an expert and not as an arbitrator and taking into account such factors, assumptions and principles as the Independent Expert shall determine in its absolute discretion), such opinion being final and binding on the Parties, is (I) more than a temporary disruption and (II) will result in the average projected monthly production capacity of the Group (taken as a whole) expressed in terms of8-inch equivalent wafers over the period of 12 months after the occurrence of the Disruption Event decreasing by 28% or more from the actual monthly production capacity of the Group (taken as a whole) expressed in terms of8-inch equivalent wafers for the month of August 2009; |
(m) | Cash Balance: the cash and cash equivalents plus the restricted cash of the Group (in each case calculated on the same basis as the calculation for the Group’s cash and cash equivalents and restricted cash for the financial year ended 31 December 2008 as reported in the Company’s annual report onForm 20-F dated 27 February 2009) (“Cash”), being: |
(i) | not less than US$585 million as at the 1st Test Date, as reflected in the monthly consolidated management accounts of the Company for the financial period ending 30 November 2009 and as certified in writing by the Chief Financial Officer of the Company; or | |
(ii) | not less than US$585 million as at the 2nd Test Date, as reflected in the Full-Year Financial Statements and as certified in writing by the Chief Financial Officer of the Company; or |
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(iii) | not less than US$400 million as at 31 January 2010 (the “3rd Test Date”), as reflected in the monthly consolidated management accounts of the Company for the financial period ending 31 January 2010 and as certified in writing by the Chief Financial Officer of the Company; or | |
(iv) | not less than US$300 million as at 28 February 2010 (the “4th Test Date”), as reflected in the monthly consolidated management accounts of the Company for the financial period ending 28 February 2010 and as certified in writing by the Chief Financial Officer of the Company, |
(A) | Cash shall be tested: |
(1) | once only, whether as of the 1st Test Date, the 2nd Test Date, the 3rd Test Date or the 4th Test Date; | |
(2) | as of the 1st Test Date if the Record Date is set between 8 December 2009 and 30 December 2009 (both dates inclusive), provided further that, if but for this paragraph (A)(2) the Record Date could be set earlier than 8 December 2009, the Company shall set the Record Date to fall between 8 December 2009 and 30 December 2009 (both dates inclusive) so as to enable Cash to be tested as of the 1st Test Date and the certificate referred to in paragraph (C) below to be delivered; | |
(3) | as of the 2nd Test Date if the Record Date is set between 8 January 2010 and 30 January 2010 (both dates inclusive), provided further that, if but for this paragraph (A)(3) the Record Date could be set earlier than 8 January 2010 (but only on or after the 2nd Test Date), the Company shall set the Record Date to fall between 8 January 2010 and 30 January 2010 (both dates inclusive) so as to enable Cash to be tested as of the 2nd Test Date and the certificate referred to in paragraph (C) below to be delivered; | |
(4) | as of the 3rd Test Date if the Record Date is set between 8 February 2010 and 27 February 2010 (both dates inclusive), provided further that, if but for this paragraph (A)(4) the Record Date could be set earlier than 8 February 2010 (but only on or after the 3rd Test Date), the Company shall set the Record Date to fall between 8 February 2010 and 27 February 2010 (both dates inclusive) so as to enable Cash to be tested as of the 3rd Test Date and the certificate referred to in paragraph (C) below to be delivered; and | |
(5) | as of the 4th Test Date if the Record Date is set on or after 8 March 2010, provided further that, if but for this paragraph (A)(5) the Record Date could be set earlier than 8 March 2010 (but only on or after the 4th Test Date), the Company shall set the Record Date to fall on or after 8 March 2010 so as to enable Cash to be tested as of the 4th Test Date and the certificate referred to in paragraph (C) below to be delivered; |
(B) | any diminution or increase in the cash and cash equivalent plus restricted cash of the Group arising from (I) currency translations (during the relevant period) attributable only to the difference between the Functional Currency of any Group Company and the Presentation Currency of the Companyand/or (II) the fees, commissions, costs and expenses incurred or accrued by the Group in relation to, or in connection with, the Acquisition and the Scheme not |
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exceeding an aggregate amount agreed between the Parties as at the date of this Agreement, shall each not be taken into account; and |
(C) | if the Chief Financial Officer of the Company does not deliver his certification in writing on or prior to: |
(1) | 10 December 2009 (in the case of paragraph (A)(2) above); | |
(2) | 10 January 2010 (in the case of paragraph (A)(3) above); | |
(3) | 10 February 2010 (in the case of paragraph (A)(4) above); or | |
(4) | 10 March 2010 (in the case of paragraph (A)(5) above), |
(n) | Undertakings: contemporaneously with the execution of this Agreement: |
(i) | STS shall have provided and delivered the STS Irrevocable Undertaking to BidCo and ATIC; and | |
(ii) | each of the Management Executives shall have provided and delivered his Management Executive Undertaking to BidCo and ATIC. |
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(1) | Conversion of Shares: the Company converting all or any of its shares into a larger or smaller number of shares; |
(2) | Share Buy-back: the Company entering into a share buy-back agreement or resolving to approve the terms of a share buy-back agreement under the Companies Act or the equivalent companies or securities legislation; |
(3) | Alteration of Share Capital: the Company resolving to alter its share capital in any way; |
(4) | Allotment of Shares: any Group Company making an allotment of, or granting an option to subscribe for, any shares or securities convertible into shares or agreeing to make such an allotment or to grant such an option or convertible security (including Company RSUs and Company PSUs); |
(5) | Issuance of Debt Securities: any Group Company issuing, or agreeing to issue, convertible notes or other debt securities; |
(6) | Dividends and other Distributions: the Company declaring, making or paying any dividends or any other form of distribution to its shareholders without the prior written approval of BidCo; |
(7) | Injunction: an injunction or other order issued by any court of competent jurisdiction or other legal restraint or prohibition preventing the consummation of the Scheme or the Acquisition or any part thereof by BidCo or the Company; |
(8) | Resolution for Winding Up: BidCo or any Group Company resolving that it be wound up; |
(9) | Appointment of Liquidator and Judicial Manager: the appointment of a liquidator, provisional liquidator, judicial managerand/or provisional judicial manager of BidCo or any Group Company; |
(10) | Order of Court for Winding Up: the making of an order by a court of competent jurisdiction for the winding up of BidCo or any Group Company; |
(11) | Composition: BidCo or any Group Company entering into any arrangement or general assignment or composition for the benefit of its creditors generally; |
(12) | Appointment of Receiver: the appointment of a receiver or a receiver and manager, in relation to the property or assets of BidCo or any Group Company; |
(13) | Insolvency: BidCo or any Group Company becoming or being deemed by law or a court to be insolvent, or stops or suspends or defaults on, or threatens to stop or suspend or default on, payment of its debts; |
(14) | Cessation of Business: BidCo or any Group Company ceases or threatens to cease for any reason to carry on business in its usual ordinary course; |
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(15) | Investigations and Proceedings: if BidCo or any Group Company or any of their respective directors is or will be the subject of any governmental, quasi-governmental, criminal, regulatory or stock exchange investigationand/or proceeding relating to any criminal or statutory offence of BidCo or any Group Company or any of their respective directors, which would have a material adverse effect on the business, operations, assetsand/or financial condition of BidCo or, as the case may be, the Group, taken as a whole, provided that thisparagraph (15) does not apply to a case where BidCo or a relevant Group Company or any of their respective directors assists in any investigation of other persons; or |
(16) | Analogous Event: any event occurs which, under the laws of any jurisdiction, has an analogous or equivalent effect to any of the foregoing event(s). |
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1. | INCORPORATION |
2. | POWER |
3. | AUTHORITY |
4. | BINDING OBLIGATION |
5. | NO BREACH |
5.1 | (i) As at the date of this Agreement, other than as set out in Clauses 4.1(a) and 4.1(f) and (ii) as at the Record Date, other than as set out in Clauses 4.1(a), 4.1(b) (by reference only to events, facts and circumstances arising after the date of this Agreement of which BidCo is not aware as at the date of this Agreement) and 4.1(f), neither the execution nor performance by BidCo of this Agreement nor any transaction contemplated under this Agreement will violate or accelerate the obligations of BidCo under any provision of its constitutive documents, or any order, writ, injunction or decree of any Governmental Authority applicable to BidCo or its assets, except for such violation or acceleration of obligations that would not have a material adverse effect on BidCo or would not materially delay or impair BidCo’s ability to perform its obligations under this Agreement; and |
5.2 | (i) As at the date of this Agreement, other than as set out in Clauses 4.1(a) and 4.1(f) and (ii) as at the Record Date, other than as set out in Clauses 4.1(a), 4.1(b) (by reference only to events, facts and circumstances arising after the date of this Agreement of which BidCo is not aware as at the date of this Agreement) and 4.1(f), as far as BidCo is aware, (A) there is no legal impediment to BidCo’s consummation of the Acquisition or implementation of the Scheme, and (B) no filing or registration with, or Authorisations of, any Governmental Authority is required of BidCo for or in respect of the Acquisition and the implementation of the Scheme, except for such filings or |
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registrations which, if not made, or for such Authorisations which, if not received, would not materially delay or impair BidCo’s ability to perform its obligations under this Agreement. |
6. | SHAREHOLDING |
7. | FINANCIAL RESOURCES |
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1. | INCORPORATION |
2. | PRE-EMPTION AND SHARES ETC. |
3. | POWER |
4. | AUTHORITY |
5. | BINDING OBLIGATION |
6. | NO BREACH |
6.1 | (i) As at the date of this Agreement, other than as set out in Clauses 4.1(a) and 4.1(f) and (ii) as at the Record Date, other than as set out in Clauses 4.1(a), 4.1(b) (by reference only to events, facts and circumstances arising after the date of this Agreement of which the Company is not aware as at |
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the date of this Agreement) and 4.1(f), neither the execution nor performance by the Company of this Agreement nor any transaction contemplated under this Agreement will violate or accelerate the obligations of any Group Company under any provision of their respective constitutive documents, any order, writ, injunction or decree of any Governmental Authority applicable to any Group Company or their respective assets, or any Material Contract, except for such violation or acceleration of obligations that would not have a material adverse effect on the assets or business of the Group taken as a whole (it being further understood and agreed that no Permitted Event shall be deemed to be a breach of this Warranty) or would not materially delay or impair the Company’s ability to perform its obligations under this Agreement; and |
6.2 | (i) As at the date of this Agreement, other than as set out in Clauses 4.1(a) and 4.1(f) and (ii) as at the Record Date, other than as set out in Clauses 4.1(a), 4.1(b) (by reference only to events, facts and circumstances arising after the date of this Agreement of which the Company is not aware as at the date of this Agreement) and 4.1(f), as far as the Company is aware (A) there is no legal impediment to the Company’s consummation of the Acquisition or implementation of the Scheme, and (B) no filing or registration with, or Authorisations of, any Governmental Authority is required of the Company for or in respect of the Acquisition and the implementation of the Scheme, except for such filings or registrations which, if not made, or for such Authorisations which, if not received, would not materially delay or impair the Company’s ability to perform its obligations under this Agreement. |
7. | FULL DISCLOSURE |
8. | ACCOUNTS |
8.1 | Accounts |
(a) | The Audited FY2008 Financial Statements have been properly drawn up in accordance with the Companies Act and the U.S. GAAP. The Audited FY2008 Financial Statements give a true and fair view, in all material respects, of the state of affairs of the Group as at 31 December 2008, and of the profits or losses of the Group for the year ended 31 December 2008. | |
(b) | Nothing has come to attention of the Company to cause it to believe that the Unaudited HY1 2009 Financial Statements have not, in all material respects, been properly drawn up on a consistent basis with the Audited FY2008 Financial Statements. |
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8.2 | Changes since 31 December 2008 and on the Record Date |
(a) | its business has been carried on solely in the ordinary and usual course, without any material interruption or alteration in its nature, scope or manner, and so as to maintain the same as a going concern, save and except for events that may occur as a result of an act of God; | |
(b) | it has not entered into any unusual, long-term and onerous commitments and contracts that would have a material adverse effect on the business, operations, assetsand/or financial condition of the Group taken as a whole; | |
(c) | it has not disposed of or assigned any assets outside the ordinary course of business with a book value in excess of US$20 million; and | |
(d) | there has been no material adverse change in the employment or other terms of employment of its directors or any of its employees who holds the title of Deputy Director or its equivalent or more senior other than pursuant to any review of employment terms and benefits carried out by the Company in the ordinary course of business. |
8.3 | Absence of Undisclosed Liabilities |
8.4 | Value of Orders |
(a) | The value of orders for the period commencing 1 July 2008 and ended 30 November 2008 as agreed in writing between the Parties as at the date of this Agreement is a true and correct value of orders received and accepted by the Group over such period. | |
(b) | The value of orders for the period commencing 1 July 2008 and ended 31 December 2008 as agreed in writing between the Parties as at the date of this Agreement is a true and correct value of orders received and accepted by the Group over such period. |
9. | LEGAL MATTERS |
9.1 | Compliance with Laws |
(a) | As far as the Company is aware, each Group Company has carried on and is carrying on its business and operations so that there have been no breaches of Applicable Laws, regulations and bye-laws in each country in which they are carried on which has a |
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material adverse effect on the assets or business of the Group taken as a whole, except that where any breach arises by reason only of any law, regulationand/or bye-law having been enacted between the date of this Agreement and the Record Date which has retrospective effect, such Group Company shall not be regarded as having been in breach of this paragraph 9.1(a) if such Group Company takes all reasonable steps to comply with such law, regulationand/or bye-law immediately thereafter. |
(b) | There have not been and there are no material breaches by any Group Company of its constitutional documents. | |
(c) | The Company is not aware of any investigation or enquiry by, or order, decree, decision or judgment of, any court, tribunal, arbitrator, Governmental Authority or regulatory body outstanding or anticipated against any Group Company which has had or may have a material adverse effect on the assets or business of the Group taken as a whole. | |
(d) | There is no notice or other communication received from any court, tribunal, arbitrator, Governmental Authority or regulatory body with respect to an alleged, actual or potential violation ofand/or failure to comply with any such Applicable Laws, regulation, bye-law or constitutional document, or requiring it to take or omit any action, which has had or would have a material adverse effect on the assets or business of the Group taken as a whole. |
9.2 | Licences and Consents |
(a) | As far as the Company is aware, all Licences necessary for the carrying on of the businesses and operations of each Group Company have been obtained, are in full force and effect and all conditions applicable to any such Licence have been and are being complied with in all material respects, unless the failure to obtain or to comply with any conditions under any such Licence does not have a material adverse effect on the assets or business of the Group taken as a whole. | |
(b) | As far as the Company is aware there is no investigation, enquiry or proceeding outstanding or anticipated which will or is likely to result in the suspension, cancellation, modification or revocation of any of the Licences that will result in a material adverse effect on the assets or business of the Group taken as a whole. | |
(c) | As far as the Company is aware, none of the Licences has been breached, suspended, cancelled, refused, modified or revoked (whether as a result of the entry into this Agreement or otherwise) that will result in a material adverse effect on the assets or business of the Group taken as a whole, except that where any breach arises by reason only of any changes to the Licence imposed by the relevant authorityand/or any changes to any Applicable Laws, regulationand/or bye-law between the date of this Agreement and the Record Date which has retrospective effect, such Group Company shall not be regarded as having been in breach of this paragraph 9.2(c) if such Group Company takes all reasonable steps to comply with such changes to the Licence immediately thereafter. |
9.3 | Litigation |
(a) | No litigation, arbitration or administrative proceeding is current or, as far as the Company is aware, pending or threatened, to restrain the entry into, the exercise of the Company’s rights |
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underand/or performance or enforcement of or compliance in all material respects with its obligations under this Agreement. |
(b) | No litigation, arbitration or administrative proceeding is current or, as far as the Company is aware, pending or threatened, which would have a material adverse effect on the business, operations, assetsand/or financial condition of the Group taken as a whole. |
10. | CONTRACTUAL ARRANGEMENTS |
10.1 | Debts, Contracts and Arrangements with Connected Persons etc. |
10.2 | Effect of the Acquisition |
(a) | do not and will not conflict with or result in the breach of or constitute a default under any Material Contract, or relieve any other party to a Material Contract with any Group Company of its obligations under such contract, or entitle such party to terminate or modify such contract, whether summarily or by notice, or result in the creation of any Encumbrance under any Material Contract, or result in a breach of any order, judgment or decree of any court, Governmental Authority or regulatory body to which any Group Company is a party or by which any Group Company or any of their respective assets is bound, save for such conflict, breach, default, relief, termination, modification or creation of Encumbrance as does not result in a material adverse effect on the assets or business of the Group taken as a whole, provided, for the avoidance of doubt, that subject to compliance by the Company with its obligations under Clauses 4.7 and 5.3(b), no Permitted Event shall be deemed to be a breach of this Warranty; or | |
(b) | will not result in any amount or benefits which are paid or given or will be paid or given by any Group Company to any of its directors or key employees. |
10.3 | Contracts |
(a) | is, or has been a party to any subsisting contract, save for contracts with professional directors, or subsisting transaction or agreement which: |
(i) | is outside the ordinary and usual course of business consistent with past practices (save for contracts with its professional advisers); | |
(ii) | is not wholly on an arm’s length basis; |
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(iii) | imposes any non-competition or exclusivity obligation on it; | |
(iv) | requires it to give preferential or more favourable terms to any one or more counterparties or grants to any counterparty any exclusivity rights; and | |
(v) | is or may become terminable or which contain provisions which may operate adversely against such Group Company as a result of the entry into or completion of this Agreement; |
(b) | is or has agreed to become a member of any joint venture, consortium, partnership or other unincorporated association; | |
(c) | is or has agreed to become a party to any agreement or arrangement for participating with others in any business sharing commissions or other income; or | |
(d) | is a party to any agency, distributorship, marketing, purchasing, manufacturing or licensing agreement or arrangement or any agreement or arrangement of any nature whatsoever which restricts its freedom to carry on its business in any part of the world in any manner, |
10.4 | Compliance with Agreements |
(a) | As far as the Company is aware, all the Material Contracts and all leases, tenancies, licences, concessions and agreements (breach of which will have a material adverse effect on the assets or business of the Group taken as a whole) (including the building agreements entered into by the Company with Jurong Town Corporation) to which any Group Company is a party are valid, binding and enforceable obligations of the relevant Group Company, and the terms thereof have been complied with in all material respects by the relevant Group Company. | |
(b) | As far as the Company is aware, there are no circumstances which will give rise to any breach of such terms, breach of which will have a material adverse effect on the assets or business of the Group taken as a whole, and no Group Company has done or omitted to do anything which gives rise to grounds for rescission, avoidance or repudiation of any of such Material Contracts or such leases, tenancies, licences, concessions or agreements and no notice of termination or amendment or of intention to terminate or amend has been received by any Group Company in respect of such Material Contracts, leases, tenancies, licences, concessions or agreements. |
11. | TAXATION MATTERS |
(a) | Each Group Company has complied in all material respects with all applicable tax laws, regulations, concessions, consentsand/or clearances imposed by the relevant Taxation authorities. As far as the Company is aware, no Group Company is, nor is expected to be involved in a material dispute in relation to Tax. | |
(b) | Nothing has come to the attention of the Company to cause it to believe that any Tax incentives and preferential Tax treatment enjoyed by the Group as at the date of this Agreement will, as far as the Company is aware, be affected, varied, withdrawn or revoked as a result of the Scheme. |
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(c) | The Company has not received any notification that any of its relief (whether by way of deduction, reduction, set-off, exemption, postponement, roll-over, repayment or allowance or otherwise) from, against or in respect of any Taxation that has been claimedand/or given to the Company would be effectively withdrawn, postponed, restricted, clawed back or otherwise lost as a result of any act, or omission by the Company, which has or would have a material adverse effect on the business, operations, assetsand/or financial condition of the Group taken as a whole. | |
(d) | As far as the Company is aware, no Group Company has done or omitted to do anything since any application for any concession, consent or clearance from any Taxation authority that was made which might reasonably be expected to cause such concession, consent or clearance to be or become invalid, or to be withdrawn by the relevant Taxation authorities, the invalidity or withdrawal of which would have a material adverse effect on the business, operations, assetsand/or financial condition of the Group taken as a whole. |
12. | ASSETS (INCLUDING PROPERTIES) |
12.1 | Title to Assets |
(a) | All material assets (including all intangible assets) and real property owned, held or used by and all material debts due to each Group Company are legallyand/or beneficially owned by it or in its possession or under its exclusive control, and in the case where it is owned by any Group Company, free from any Encumbrances. | |
(b) | Any real property in Singapore and elsewhere which is held under lease by any Group Company, is held under a valid, subsisting and enforceable lease or tenancy agreement with such exceptions as do not materially interfere with the use or proposed use of such property and buildings. | |
(c) | There is no material deficiency which requires correction in the state or condition of any building or other structure on or forming part of any real property owned or occupied by any Group Company. | |
(d) | The buildings and other structures on such real property are in good and substantial repair and fit for the purposes for which they are used. No building or other structure on or forming part of such real property contains a deleterious substance or a substance which is not at the date of this Agreement used in generally accepted good buildings practice, except for such as would not have a material adverse effect on the assets or business of the Group taken as a whole. |
13. | INSURANCE |
13.1 | Status of Policies |
13.2 | Claims |
(a) | No claims under any Policy that have or may have a material adverse effect on the business, operations, assetsand/or financial condition of the Group taken as a whole (“Material Claim”) have been made or is outstanding in respect of any Policy, and as far as the |
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Company is aware, there is no fact or circumstance that exists which might give rise to a Material Claim under any of the Policies which would result in a material adverse effect on the assets or business of the Group taken as a whole. |
(b) | As far as the Company is aware, none of the insurers under any of the Policies has refused, or given any notice that it intends to void a Policy or refuse, indemnity in whole or in part in respect of any Material Claim under the Policies. | |
(c) | As far as the Company is aware, nothing has been done or omitted to be done, and there is nothing, which might entitle the insurers under any of the Policies to refuse indemnity in whole or in part in respect of any Material Claim under the Policies. |
14. | INTELLECTUAL PROPERTY RIGHTS |
14.1 | Ownership |
14.2 | Claims and Infringement |
(a) | The relevant Group Company’s Intellectual Property Rights, and the validity or subsistence or enforceability of that Group Company’s right, title and interest therein, is not the subject of any current or, as far as the Company is aware, pending or threatened, challenge, claim, dispute or proceeding, including for entitlement, opposition, cancellation, revocation or rectification, and has not been the subject of any challenge, claim, dispute or proceeding, and as far as the Company is aware, there are no facts or matters which would give rise to any such challenge, claim, dispute or proceeding, in each case, which would have a material adverse effect on the business, operations, assetsand/or financial condition of the Group taken as a whole. | |
(b) | Each Group Company has taken all steps open to it to preserve that Group Company’s material Intellectual Property Rights. Without limitation, all renewal fees regarding the relevant Group Company’s material Intellectual Property Rights due on or before the date of this Agreement have been paid in full. | |
(c) | As far as the Company is aware, none of the relevant Group Company’s Intellectual Property Rights is currently being or has been infringed by any third party or has been infringed nor has the Company threatened any such infringement against any third party, which would have a material adverse effect on the business, operations, assetsand/or financial condition of the Group taken as a whole. | |
(d) | The Company is not aware of nor has any basis to believe that any of its or the other Group Company’s employees, agents, contractors or service providers is entitled to or has claimed any interest in or any payment or compensation in respect of any of the material Intellectual |
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Property Rights of any Group Company, nor, as far as the Company is aware, has any such party violated any fiduciary or confidential relationship or any term of any employment or other agreement in connection with any material Intellectual Property Rights of any Group Company. |
14.3 | Intellectual Property Contracts |
(a) | The negotiation, execution, delivery or performance of this Agreement, or the consummation of the transactions contemplated hereunder, shall not require any person’s consent or a formal notice to any person, nor result in any of the following pursuant to the terms of any Intellectual Property Contract or by which the Group Companies, or any of them, or any of their properties or assets, may be bound: |
(i) | the grant or transfer to any third party of any license or other interest under, the abandonment, assignment to any third party, or modification or loss of any rights, licence, benefit, right or privilege under or in connection with a material Intellectual Property Contract or with respect to, or the creation of any Encumbrance on, any material Intellectual Property Rights owned by or licensed to the Group Companies; | |
(ii) | the Group Companies, ATIC, BidCo or GLOBALFOUNDRIES, being (A) bound by or subject to any non-compete or licensing obligation, covenant not to sue, or other restriction on or modification of the current or contemplated operation or scope of its business, which such party was not bound by or subject to prior to completion of the Acquisition and which would have a material adverse effect on the assets or business of the Group taken as a whole, or (B) obligated to (1) pay any royalties, honoraria, fees or other payments to any person materially in excess of those payable by such party prior to completion of the Acquisition, or (2) provide or offer any discounts or other reduced payment obligations to any person materially in excess of those provided to such person prior to completion of the Acquisition, provided in each case that any agreement, arrangement or understanding entered or to be entered into by ATIC, BidCo or GLOBALFOUNDRIES for the purpose of or with a view to effecting the operational combination of the Company with GLOBALFOUNDRIES to form a single undertaking, or any matter contemplated or to be taken under any such agreement, arrangement or understanding, whether or not with the agreement of the Company, shall not give rise to or result in a breach of this warranty in paragraph 14.3(a)(ii); and | |
(iii) | any person becoming entitled to exercise any right to terminate a material Intellectual Property Contract or to exercise any other right under or in connection with a material Intellectual Property Contract. |
15. | EMPLOYMENT |
15.1 | To the best of the Company’s knowledge, each Group Company has not entered into any collective agreement, and has in relation to each of its directors, employees and consultants (and former directors, employees and consultants) complied in all material respects with: |
(a) | all obligations imposed on it by all statutes, regulations and codes of conduct and practice relevant to the relations between it and its directors, employees and consultants (and former directors, employees and consultants) or other employee representative body, including |
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without limitation, making deductions and payments in respect of contributions (including employer’s contributions) to any relevant competent authority; |
(b) | all employment agreements and other conditions of service of its directors, employees and consultants (and former directors, employees and consultants); and | |
(c) | all relevant orders and awards made under any relevant statute, regulation or code of conduct and practice affecting the conditions of service of its directors, employees and consultants (and former directors, employees and consultants), |
15.2 | To the best of the Company’s knowledge, there has been no strike, work to rule, work stoppage, work interference activity, material grievances or arbitrations or industrial action (official or unofficial) by any employee of any Group Company, threatened or on-going that could have a material adverse effect on the assets or business of the Group taken as a whole. |
15.3 | There are not in existence nor has any proposal been announced to establish any retirement, post-retirement welfare, death or disability or other benefit schemes for directors, employees or consultants (or former directors, employees or consultants) of any Group Company nor are there any obligations to or in respect of present or former directors, employees or consultants of any Group Company with regard to retirement, post-retirement welfare, death or disability pursuant to which any Group Company is or may become liable to make payments of a material nature and no pension or retirement or post-retirement welfare or sickness gratuity of a material nature is currently being paid or has been promised by any Group Company to or in respect of any former director, employee or consultant. |
15.4 | As far as the Company is aware, no notice to terminate the contract of employment of any key employee of any Group Company (whether given by any such Group Company or by the employee) is pending, outstanding or threatened. For the purposes of thissub-paragraph, the term “key employee” shall mean Chia Song Hwee and George Thomas. |
16. | EMPLOYEE INCENTIVE PLANS |
16.1 | No options or rights over shares in any Group Company have been issued or granted by the Company pursuant to any employee incentive plan, nor is any Group Company subject to any actual or contingent obligation to issue or grant any Options or rights over shares in any Group Company or issue or transfer any Shares or ADSs pursuant to the exercise of any options or under any employee incentive plan. |
16.2 | No award of Shares has been granted or made pursuant to the Company PSU or the Company RSU, nor is the Company subject to any actual or contingent obligation to grant or make any such awards or issue any Shares pursuant to such awards. |
17. | ENVIRONMENTAL MATTERS |
17.1 | Each Group Company has at all times complied in all material respects with all environmental legislation in force, relevant or applicable to each Group Company in Singapore or elsewhere (the “Environmental Legislation”) and there is nothing in, on, over or under any property owned or occupied by any Group Company, the presence, existence or condition of which constitutes a |
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breach of such Environmental Legislation nor is there or has there been any manufacturing, storage, generation, servicing, treatment, disposal or other process carried on at any property owned or occupied by any Group Company in such a way as to amount to a breach of the same, except in each case for such breach that would not have a material adverse effect on the assets or business of the Group taken as a whole. |
17.2 | No complaints have been received from any third party (including any employee of any of the Group Companies or governmental, regulatory, supervisory or administrative body) with regard to any material breach of the Environmental Legislation whether in connection with any property owned or occupied by any Group Company or otherwise and the Company is not aware of any events, circumstances or matters which may lead to such complaint. |
17.3 | No toxic industrial waste or toxic substance (as defined in any Environmental Legislation) or any other similar substance (howsoever termed) has been spilt, released, discharged or disposed in the soil or water in, under, around or upon any property owned or occupied by any Group Company, except for any spill, release, discharge or disposal that would not have a material adverse effect on the assets or business of the Group taken as a whole. |
18. | FEES, COMMISSIONS AND BROKERAGE |
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1. | Rights and Privileges of Shareholders. The rights and privileges of Shareholders in respect of voting, dividend and capital are stated in the Articles and are reproduced below as follows: |
1.1 | Rights in Respect of Voting |
Annual General
Meeting.
51 | An Annual General Meeting shall be held once in every year, at such time (within a period of not more than fifteen months after the holding of the last preceding Annual General Meeting) and place as may be determined by the Directors. All other General Meetings shall be called Extraordinary General Meetings. |
Extraordinary
General Meeting.
52 | The Directors may whenever they think fit, and shall on requisition in accordance with the Statutes, proceed with proper expedition to convene an Extraordinary General Meeting. |
Notice of
Meetings.
53 | Any General Meeting at which it is proposed to pass a Special Resolution or (save as provided by the Statutes) a resolution of which special notice has been given to the Company, shall be called by twenty-one days’ notice in writing at the least and an Annual General Meeting and any other Extraordinary General Meeting by fourteen days’ notice in writing at the least. The period of notice shall in each case be exclusive of the day on which it is served or deemed to be served and of the day on which the meeting is to be held and shall be given in the manner hereinafter mentioned to all members other than such as are not under the provisions of these presents and the Act entitled to receive such notices from the Company; Provided that a General Meeting notwithstanding that it has been called by a shorter notice than that specified above shall be deemed to have been duly called if it is so agreed:- |
(a) | in the case of an Annual General Meeting, by all the members entitled to attend and vote thereat; and | |
(b) | in the case of an Extraordinary General Meeting, by a majority in number of the members having a right to attend and vote thereat, being a majority together holding not less than 95 per cent of the total voting rights of all members having a right to vote at that meeting. |
Contents of
notice.
54 (A) | Every notice calling a General Meeting shall specify the place and the day and hour of the meeting, and there shall appear with reasonable prominence in every such notice a statement that a member entitled to attend and vote is entitled to appoint a proxy to attend and vote instead of him and that a proxy need not be a member of the Company. |
(B) | In the case of an Annual General Meeting, the notice shall also specify the meeting as such. |
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(C) | In the case of any General Meeting at which business other than routine business is to be transacted, the notice shall specify the general nature of such business; and if any resolution is to be proposed as a Special Resolution, the notice shall contain a statement to that effect. |
business.
55 | Routine business shall mean and include only business transacted at an Annual General Meeting of the following classes, that is to say:- |
(a) | declaring dividends; | |
(b) | receiving and adopting the accounts, the reports of the Directors and Auditors and other documents required to be attached or annexed to the accounts; | |
(c) | appointing or re-appointing Directors to fill vacancies arising at the meeting on retirement whether by rotation or otherwise; | |
(d) | re-appointing the retiring Auditors (unless they were last appointed otherwise than by the Company in General Meeting); | |
(e) | fixing the remuneration of the Auditors or determining the manner in which such remuneration is to be fixed; and | |
(f) | fixing the remuneration of the Directors proposed to be paid under Article 81. |
effect of special
business.
56 | Any notice of a General Meeting to consider special business shall be accompanied by a statement regarding the effect of any proposed resolution on the Company in respect of such special business. |
57 | The Chairman of the Board of Directors, failing whom the Deputy Chairman, shall preside as chairman at a General Meeting. If there be no such Chairman or Deputy Chairman, or if at any meeting neither be present within 15 minutes after the time appointed for holding the meeting and willing to act, the Directors present shall choose one of their number (or, if no Director be present or if all the Directors present decline to take the chair, the members present shall choose one of their number) to be chairman of the meeting. |
58 | No business other than the appointment of a chairman shall be transacted at any General Meeting unless a quorum is present at the time when the meeting proceeds to business. Save as herein otherwise provided, the quorum at any General Meeting shall be two or more members holding or representing in aggregate not less than 331/3 per cent. of the total number of issued and fully paid up shares in the capital of the Company, present in person or by proxy. |
present,
adjournment or
dissolution of
meeting.
59 | If within 30 minutes from the time appointed for a General Meeting (or such longer interval as the chairman of the meeting may think fit to allow) a quorum is not present, the meeting, if convened on the requisition of members, shall be dissolved. In any other case it shall stand adjourned to the same day in the next week (or if that day is a public holiday then to the next Business Day following that public holiday) at the same time and place or such other day, time or place as the Directors may by not less than ten days’ notice appoint. At the adjourned meeting any one or more members present in person or by proxy shall be a quorum. |
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60 | The chairman of any General Meeting at which a quorum is present may with the consent of the meeting (and shall if so directed by the meeting) adjourn the meeting from time to time (orsinedie) and from place to place, but no business shall be transacted at any adjourned meeting except business which might lawfully have been transacted at the meeting from which the adjournment took place. Where a meeting is adjournedsinedie, the time and place for the adjourned meeting shall be fixed by the Directors. When a meeting is adjourned for 30 days or more orsinedie, not less than seven days’ notice of the adjourned meeting shall be given in like manner as in the case of the original meeting. |
adjournment.
61 | Save as hereinbefore expressly provided, it shall not be necessary to give any notice of an adjournment or of the business to be transacted at an adjourned meeting. |
resolution.
62 | If an amendment shall be proposed to any resolution under consideration but shall in good faith be ruled out of order by the chairman of the meeting, the proceedings on the substantive resolution shall not be invalidated by any error in such ruling. In the case of a resolution duly proposed as a Special Resolution, no amendment thereto (other than a mere clerical amendment to correct a patent error) may in any event be considered or voted upon. |
voting.
63 | At any General Meeting a resolution put to the vote of the meeting shall be decided on a show of hands unless a poll is (before or on the declaration of the result of the show of hands) demanded by:- |
(a) | the chairman of the meeting; or | |
(b) | any member present in person or by proxy and entitled to vote at the meeting; or | |
(c) | a member present in person or by proxy and representing not less than one-tenth of the total voting rights of all the members having the right to vote at the meeting; or | |
(d) | a member present in person or by proxy and holding not less than 10 per cent. of the total number ofpaid-up shares of the Company (excluding treasury shares); |
64 | A demand for a poll may be withdrawn only with the approval of the meeting. Unless a poll is required a declaration by the chairman of the meeting that a resolution has been carried, or carried unanimously, or by a particular majority, or lost, and an entry to that effect in the minute book, shall be conclusive evidence of that fact without proof of the number or proportion of the votes recorded for or against such resolution. If a poll is required, it shall be taken in such manner (including the use of ballot or voting papers) as the chairman of the meeting may direct, and the result of the poll shall be deemed to be the resolution of the meeting at which the poll was demanded. The chairman of the meeting may (and if so directed by the meeting shall) appoint scrutineers and may adjourn the meeting to some place and time fixed by him for the purpose of declaring the result of the poll. |
Chairman.
65 | In the case of an equality of votes, whether on a show of hands or on a poll, the chairman of the meeting at which the show of hands takes place or at which the poll is demanded shall be entitled to a casting vote. |
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66 | A poll demanded on any question shall be taken either immediately or at such subsequent time (not being more than 30 days from the date of the meeting) and place as the chairman may direct. No notice need be given of a poll not taken immediately. The demand for a poll shall not prevent the continuance of the meeting for the transaction of any business other than the question on which the poll has been demanded. |
67 | Subject and without prejudice to any special privileges or restrictions as to voting for the time being attached to any special class of shares for the time being forming part of the capital of the Company and to Article 7 each member entitled to vote may vote in person or by proxy. On a show of hands every member who is present in person or by proxy shall have one vote (provided that in the case of a member who is represented by two proxies, only one of the two proxies as determined by that member or, failing such determination, by the Chairman of the meeting (or by a person authorised by him) in his sole discretion shall be entitled to vote on a show of hands) and on a poll, every member who is present in person or by proxy shall have one vote for every share which he holds or represents. For the purpose of determining the number of votes which a member, being a Depositor, or his proxy may cast at any General Meeting on a poll, the reference to shares held or represented shall, in relation to shares of that Depositor, be the number of shares entered against his name in the Depository Register as at 48 hours before the time of the relevant General Meeting as certified by the Depository to the Company. |
68 | In the case of joint holders of a share the vote of the senior who tenders a vote, whether in person or by proxy, shall be accepted to the exclusion of the votes of the other joint holders and for this purpose seniority shall be determined by the order in which the names stand in the Register of Members or (as the case may be) the Depository Register in respect of the share. |
69 | Where in Singapore or elsewhere a receiver or other person (by whatever name called) has been appointed by any court claiming jurisdiction in that behalf to exercise powers with respect to the property or affairs of any member on the ground (however formulated) of mental disorder, the Directors may in their absolute discretion, upon or subject to production of such evidence of the appointment as the Directors may require, permit such receiver or other person on behalf of such member to vote in person or by proxy at any General Meeting or to exercise any other right conferred by membership in relation to meetings of the Company. |
70 | No member shall, unless the Directors otherwise determine, be entitled in respect of shares held by him to vote at a General Meeting either personally or by proxy or to exercise any other right conferred by membership in relation to meetings of the Company if any call or other sum presently payable by him to the Company in respect of such shares remains unpaid. |
71 | No objection shall be raised as to the admissibility of any vote except at the meeting or adjourned meeting at which the vote objected to is or may be given or tendered and every vote not disallowed at such meeting shall be valid for all purposes. Any such objection shall be referred to the chairman of the meeting whose decision shall be final and conclusive. |
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72 | On a poll, votes may be given either personally or by proxy and a person entitled to more than one vote need not use all his votes or cast all the votes he uses in the same way. |
73 | (A) A member may appoint not more than two proxies to attend and vote at the same General Meeting provided that if the member is a Depositor, the Company shall be entitled and bound:- |
74 (A) | An instrument appointing a proxy shall be in writing in any usual or common form or in any other form which the Directors may approve and:- |
75 | An instrument appointing a proxy must be left at such place or one of such places (if any) as may be specified for that purpose in or by way of note to or in any document accompanying the notice convening the meeting (or, if no place is so specified, at the Office) not less than 48 hours before the time appointed for the holding of the meeting or adjourned meeting or (in the case of a poll taken otherwise than at or on the same day as the meeting or adjourned |
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meeting) for the taking of the poll at which it is to be used, and in default shall not be treated as valid. The instrument shall, unless the contrary is stated thereon, be valid as well for any adjournment of the meeting as for the meeting to which it relates; Provided that an instrument of proxy relating to more than one meeting (including any adjournment thereof) having once been so delivered for the purposes of any meeting shall not be required again to be delivered for the purposes of any subsequent meeting to which it relates. |
proxies.
76 | An instrument appointing a proxy shall be deemed to include the right to demand or join in demanding a poll, to move any resolution or amendment thereto and to speak at the meeting. |
death or
insanity of
principal not
to revoke
proxy.
77 | A vote cast by proxy shall not be invalidated by the previous death or insanity of the principal or by the revocation of the appointment of the proxy or of the authority under which the appointment was made provided that no intimation in writing of such death, insanity or revocation shall have been received by the Company at the Office at least one hour before the commencement of the meeting or adjourned meeting or (in the case of a poll taken otherwise than at or on the same day as the meeting or adjourned meeting) the time appointed for the taking of the poll at which the vote is cast. |
acting by
representatives.
78 | Any corporation which is a member of the Company may by resolution of its directors or other governing body authorise such person as it thinks fit to act as its representative at any meeting of the Company or of any class of members of the Company. The person so authorised shall be entitled to exercise the same powers on behalf of such corporation as the corporation could exercise if it were an individual member of the Company and such corporation shall for the purposes of these presents (but subject to the Act) be deemed to be present in person at any such meeting if a person so authorised is present thereat. |
1.2 | Rights in Respect of Dividends |
123 | The Company may by Ordinary Resolution declare dividends but no such dividend shall exceed the amount recommended by the Directors. |
dividend.
124 | If and so far as in the opinion of the Directors the profits of the Company justify such payments, the Directors may declare and pay the fixed dividends on any class of shares carrying a fixed dividend expressed to be payable on fixed dates on the half-yearly or other dates prescribed for the payment thereof and may also from time to time declare and pay interim dividends on shares of any class of such amounts and on such dates and in respect of such periods as they think fit. |
of dividends.
125 | Subject to any rights or restrictions attached to any shares or class of shares and except as otherwise permitted under the Act: |
(a) | all dividends in respect of shares shall be paid in proportion to the number of shares held by a member but where shares are partly paid all dividends shall be apportioned |
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and paid proportionately to the amounts paid or credited as paid on the partly paid shares; and |
(b) | all dividends shall be apportioned and paid proportionately to the amounts so paid or credited as paid during any portion or portions of the period in respect of which the dividend is paid. |
Dividend payable only out of profits.
126 | No dividend shall be paid otherwise than out of profits available for distribution under the provisions of the Statutes. |
Dividend not to bear interest.
127 | No dividend or other moneys payable on or in respect of a share shall bear interest as against the Company. |
Retention of
dividend.
128 (A) | The Directors may retain any dividend or other moneys payable on or in respect of a share on which the Company has a lien and may apply the same in or towards satisfaction of the debts, liabilities or engagements in respect of which the lien exists. |
(B) | The Directors may retain the dividends payable upon shares in respect of which any person is under the provisions as to the transmission of shares hereinbefore contained entitled to become a member, or which any person is under those provisions entitled to transfer, until such person shall become a member in respect of such shares or shall transfer the same. |
dividend.
129 | The waiver in whole or in part of any dividend on any share by any document (whether or not under seal) shall be effective only if such document is signed by the shareholder (or the person entitled to the share in consequence of the death or bankruptcy of the holder) and delivered to the Company and if or to the extent that the same is accepted as such or acted upon by the Company. |
dividends or
other
moneys.
129A | The payment by the Directors of any unclaimed dividends or other moneys payable on or in respect of a share into a separate account shall not constitute the Company a trustee in respect thereof. All dividends and other moneys payable on or in respect of a share that are unclaimed after first becoming payable may be invested or otherwise made use of by the Directors for the benefit of the Company and any dividend or any such moneys unclaimed after a period of six years from the date they are first payable may be forfeited and if so shall revert to the Company but the Directors may at any time thereafter at their absolute discretion annul any such forfeiture and pay the moneys so forfeited to the person entitled thereto prior to the forfeiture. If the Depository returns any such dividend or moneys to the Company, the relevant Depositor shall not have any right or claim in respect of such dividend or moneys against the Company if a period of six years has elapsed from the date on which they are first payable. |
dividend in
specie.
130 | The Company may upon the recommendation of the Directors by Ordinary Resolution direct payment of a dividend in whole or in part by the distribution of specific assets (and in particular ofpaid-up shares or debentures of any other company) and the Directors shall give effect to such resolution. Where any difficulty arises in regard to such distribution, the Directors may settle the same as they think expedient and in particular may issue fractional certificates, may fix the value for distribution of such specific assets or any part thereof, may |
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determine that cash payments shall be made to any members upon the footing of the value so fixed in order to adjust the rights of all parties and may vest any such specific assets in trustees as may seem expedient to the Directors. |
payable by
cheque or
warrant.
131 | Any dividend or other moneys payable in cash on or in respect of a share may be paid by cheque or warrant sent through the post to the registered address appearing in the Register of Members or (as the case may be) the Depository Register of a member or person entitled thereto (or, if two or more persons are registered in the Register of Members or (as the case may be) entered in the Depository Register as joint holders of the share or are entitled thereto in consequence of the death or bankruptcy of the holder, to any one of such persons) or to such person at such address as such member or person or persons may by writing direct. Every such cheque or warrant shall be made payable to the order of the person to whom it is sent or to such person as the holder or joint holders or person or persons entitled to the share in consequence of the death or bankruptcy of the holder may direct and payment of the cheque or warrant by the banker upon whom it is drawn shall be a good discharge to the Company. Every such cheque or warrant shall be sent at the risk of the person entitled to the money represented thereby. Notwithstanding the foregoing provisions of this Article and the provisions of Article 133, the payment by the Company to the Depository of any dividend payable to a Depositor shall, to the extent of the payment made to the Depository, discharge the Company from any liability to the Depositor in respect of that payment. |
dividend to
joint holders.
132 | If two or more persons are registered in the Register of Members or (as the case may be) the Depository Register as joint holders of any share, or are entitled jointly to a share in consequence of the death or bankruptcy of the holder, any one of them may give effectual receipts for any dividend or other moneys payable or property distributable on or in respect of the share. |
declaring
dividends.
133 | Any resolution declaring a dividend on shares of any class, whether a resolution of the Company in General Meeting or a resolution of the Directors, may specify that the same shall be payable to the persons registered as the holders of such shares in the Register of Members or (as the case may be) the Depository Register at the close of business on a particular date and thereupon the dividend shall be payable to them in accordance with their respective holdings so registered, but without prejudice to the rightsinter se in respect of such dividend of transferors and transferees of any such shares. |
1.3 | Rights in Respect of Capital |
4 | Subject to the Statutes and to these presents, no shares may be issued by the Directors without the prior approval of the Company in General Meeting but subject thereto and to Article 8, and to any special rights attached to any shares for the time being issued, the Directors may allot or grant options over or otherwise dispose of the same to such persons on such terms and conditions and for such consideration and at such time and subject or not to the payment of any part of the amount thereof in cash as the Directors may think fit, and any shares may be issued with such preferential, deferred, qualified or special rights, privileges or conditions as the Directors may think fit, and preference shares may be |
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issued which are or at the option of the Company are liable to be redeemed, the terms and manner of redemption being determined by the Directors. |
rights.
6 (A) | Whenever the share capital of the Company is divided into different classes of shares, the special rights attached to any class may, subject to the provisions of the Statutes, be varied or abrogated either with the consent in writing of the holders of three-quarters of the issued shares of the class or with the sanction of a Special Resolution passed at a separate General Meeting of the holders of the shares of the class (but not otherwise) and may be so varied or abrogated either whilst the Company is a going concern or during or in contemplation of awinding-up. To every such separate General Meeting all the provisions of these presents relating to General Meetings of the Company and to the proceedings thereat shallmutatis mutandis apply, except that the necessary quorum shall be two persons at least holding or representing by proxy at least one-third of the issued shares of the class and that any holder of shares of the class present in person or by proxy may demand a poll and that every such holder shall on a poll have one vote for every share of the class held by him, Provided always that where the necessary majority for such a Special Resolution is not obtained at such General Meeting, consent in writing if obtained from the holders of three-quarters of the issued shares of the class concerned within two months of such General Meeting shall be as valid and effectual as a Special Resolution carried at such General Meeting. The foregoing provisions of this Article shall apply to the variation or abrogation of the special rights attached to some only of the shares of any class as if each group of shares of the class differently treated formed a separate class the special rights whereof are to be varied. |
issue shares.
8 (A) | The Company may by Ordinary Resolution in General Meeting give to the Directors a general authority, either unconditionally or subject to such conditions as may be specified in the Ordinary Resolution, to issue shares (whether by way of rights, bonus or otherwise) where, unless previously revoked or varied by the Company in General Meeting, such authority to issue shares does not continue beyond the conclusion of the Annual General Meeting of the Company next following the passing of the Ordinary Resolution or the date by which such Annual General Meeting is required to be held, or the expiration of such other period as may be prescribed by the Statutes (whichever is the earliest). |
(B) | Except so far as otherwise provided by the conditions of issue or by these presents, all new shares shall be subject to the provisions of the Statutes and of these presents with reference to allotment, payment of calls, lien, transfer, transmission, forfeiture and otherwise. |
consolidate,
sub-divide
and convert
shares.
9 | The Company may by Ordinary Resolution:- |
(a) | consolidate and divide all or any of its shares; | |
(b) | sub-divide its shares, or any of them (subject, nevertheless, to the provisions of the Statutes), and so that the resolution whereby any share issub-divided may determine that, as between the holders of the shares resulting from suchsub-division, one or |
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more of the shares may, as compared with the others, have any such preferred, deferred or other special rights, or be subject to any such restrictions, as the Company has power to attach to new shares; and |
(c) | subject to the provisions of the Statutes, convert any class of shares into any other class of shares. |
reduce
share
capital.
10 (A) | The Company may reduce its share capital or any undistributable reserve in any manner and with and subject to any incident authorised and consent required by law. Without prejudice to the generality of the foregoing, upon cancellation of any share purchased or otherwise acquired by the Company pursuant to these presents, the number of issued shares of the Company shall be diminished by the number of the shares so cancelled, and, where any such cancelled share was purchased or acquired out of the capital of the Company, the amount of the share capital of the Company shall be reduced accordingly. |
acquire its own
issued ordinary
shares.
(B) | The Company may, subject to and in accordance with the Statutes, purchase or otherwise acquire its issued shares on such terms and in such manner as the Company may from time to time think fit. If required by the Statutes, any share which is so purchased or acquired by the Company shall, unless held in treasury in accordance with the Act, be deemed to be cancelled immediately on purchase or acquisition by the Company. On the cancellation of any share as aforesaid, the rights and privileges attached to that share shall expire. In any other instance, the Company may hold or deal with any such share which is so purchased or acquired by it in such manner as may be permitted by, and in accordance with, the Statutes. |
equities.
11 | Except as required by law, no person shall be recognised by the Company as holding any share upon any trust, and the Company shall not be bound by or compelled in any way to recognise any equitable, contingent, future or partial interest in any share, or any interest in any fractional part of a share, or (except only as by these presents or by law otherwise provided) any other right in respect of any share, except an absolute right to the entirety thereof in the person (other than the Depository) entered in the Register of Members as the registered holder thereof or (as the case may be) person whose name is entered in the Depository Register in respect of that share. |
preference
shares.
12 | Without prejudice to any special rights previously conferred on the holders of any shares or class of shares for the time being issued, any share in the Company may be issued with such preferred, deferred or other special rights, or subject to such restrictions, whether as regards dividend, return of capital, voting or otherwise, as the Company may from time to time by Ordinary Resolution determine (or, in the absence of any such determination, as the Directors may determine) and subject to the provisions of the Statutes the Company may issue preference shares which are, or at the option of the Company are, liable to be redeemed. |
13 | Subject to the provisions of these presents and of the Statutes relating to authority and of any resolution of the Company in General Meeting passed pursuant thereto, all new shares shall be at the disposal of the Directors and they may allot (with or without conferring a right of |
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renunciation), grant options over or otherwise dispose of them to such persons, at such times and on such terms as they think proper. |
pay
commission
and brokerage.
14 | The Company may pay commissions or brokerage on any issue of shares at such rate or amount and in such manner as the Directors may deem fit. Such commissions or brokerage may be satisfied by the payment of cash or the allotment of fully or partly paid shares or partly in one way and partly in the other. |
allotment.
15 | Subject to the terms and conditions of any application for shares, the Directors shall allot shares applied for within thirty days of the closing date of any such application. The Directors may, at any time after the allotment of any share but before any person has been entered in the Register of Members as the holder or (as the case may be) before that share is entered against the name of a Depositor in the Depository Register, recognise a renunciation thereof by the allottee in favour of some other person and may accord to any allottee of a share a right to effect such renunciation upon and subject to such terms and conditions as the Directors may think fit to impose. |
convert into
stock.
48 | The Company may from time to time by Ordinary Resolution convert anypaid-up shares into stock and may from time to time by like resolution reconvert any stock intopaid-up shares. |
stock.
49 | The holders of stock may transfer the same or any part thereof in the same manner and subject to the same Articles as and subject to which the shares from which the stock arose might previously to conversion have been transferred (or as near thereto as circumstances admit) but no stock shall be transferable except in such units as the Directors may from time to time determine. |
stockholders.
50 | The holders of stock shall, according to the number of stock units held by them, have the same rights, privileges and advantages as regards dividend, return of capital, voting and other matters, as if they held the shares from which the stock arose; but no such privilege or advantage (except as regards participation in the profits or assets of the Company) shall be conferred by the number of stock units which would not, if existing in shares, have conferred such privilege or advantage; and no such conversion shall affect or prejudice any preference or other special privileges attached to the shares so converted. |
issue free
bonus shares
and to
capitalise
profits.
134 (A) | The Directors may, with the sanction of an Ordinary Resolution of the Company (including any Ordinary Resolution passed pursuant to Article 8(A)): |
(a) | issue bonus shares for which no consideration is payable to the Company, to the persons registered as holders of shares in the Register of Members or (as the case may be) in the Depository Register at the close of business on: |
(i) | the date of the Ordinary Resolution (or such other date as may be specified therein or determined as therein provided); or | |
(ii) | (in the case of an Ordinary Resolution passed pursuant to Article 8(A)) such other date as may be determined by the Directors, |
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(b) | capitalise any sum standing to the credit of any of the Company’s reserve accounts or other undistributable reserve or any sum standing to the credit of profit and loss account by appropriating such sum to the persons registered as holders of shares in the Register of Members or (as the case may be) in the Depository Register at the close of business on: |
(i) | the date of the Ordinary Resolution (or such other date as may be specified therein or determined as therein provided); or | |
(ii) | in the case of an Ordinary Resolution passed pursuant to Article 8(A)) such other date as may be determined by the Directors, |
Directors to
give effect
to bonus
issues and
capitalisations.
(B) | The Directors may do all acts and things considered necessary or expedient to give effect to any such bonus issueand/or capitalisation under Article 134(A), with full power to the Directors to make such provisions as they think fit for any fractional entitlements which would arise on the basis aforesaid (including provisions whereby fractional entitlements are disregarded or the benefit thereof accrues to the Company rather than to the members concerned). The Directors may authorise any person to enter, on behalf of all the members interested, into an agreement with the Company providing for any such bonus issue or capitalisation and matters incidental thereto and any agreement made under such authority shall be effective and binding on all concerned. |
issue free
shares and
to capitalise
profits for
paying up
shares to
be issued
under share
option scheme.
135 | In addition and without prejudice to the powers provided for by Article 134, the Directors shall have power to issue shares for which no consideration is payableand/or to capitalise any undivided profits or other moneys of the Company not required for the payment or provision of the fixed dividend on any shares entitled to fixed cumulative or non-cumulative preferential dividends (including profits or moneys carried and standing to any reserve or reserves) and to apply such profits or moneys in paying up in full new shares , in each case on terms that such shares shall, upon issue, be held by or for the benefit of participants of any share incentive or option scheme or plan implemented by the Company and approved by shareholders in General Meeting and on such terms as the Directors shall think fit. |
2. | Rights and Privileges of Preference Share Holders. The rights and privileges of Preference Share Holders in respect of voting, dividend and capital are stated in the Articles are reproduced below as follows: |
2.1 | Rights in Respect of Voting |
Voting Rights.
4A.11 (1) | Right to Receive Information and Attend and Vote at Meetings. The Preference Shareholders shall be entitled: |
(a) | to receive copies of the reports and accounts (including the balance sheet and profit and loss account) of the Company or in lieu of the annual audited |
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accounts of the Company, upon their election, the summary financial statements prepared and delivered in accordance with the Act, circulars and notices of General Meetings, being the same as those which the holders of Ordinary Shares are entitled to receive, but shall not be entitled to attend or vote at any General Meeting other than under the circumstances set out inArticle 4A.11(1)(c); |
(b) | to attend, speak and vote (in person or by proxy or attorney or in the case of a corporation, by a duly authorised representative) at any Class Meeting; and | |
(c) | notwithstandingArticle 4A.11(1)(a), to attend (in person or by proxy or attorney or in the case of a corporation, by a duly authorised representative) any General Meeting of the Company and to be counted for the purposes of a quorum at such General Meeting and to vote at any General Meeting of the Company if (but only if): |
(i) | the resolution in question varies the rights attached to the Preference Shares; or | |
(ii) | the resolution in question is for thewinding-up of the Company, |
(2) | Number of Votes. At every General Meeting at which the Preference Shareholders are entitled to attend and vote pursuant toArticle 4A.11(1)(c) and at every Class Meeting, every Preference Shareholder who is present in person or by proxy or attorney (or in the case of a corporation by a duly authorized representative): |
(a) | on a show of hands shall have one vote; and | |
(b) | on a poll shall have one vote for each Ordinary Share into which each Preference Share held by such Preference Shareholder would have been converted if the Conversion Date for such Preference Share were the date 48 hours preceding the date of such General Meeting or Class Meeting. |
(3) | Proxies. A Preference Shareholder may appoint not more than two proxies to attend and vote at the same General Meeting or Class Meeting. In any case where a form of proxy appoints more than one proxy, the proportion of the shareholding concerned to be represented by each proxy shall be specified in the form of proxy. A proxy need not be a member of the Company. | |
(4) | General. The provisions of these presents relating to votes of members of the Company shall (subject to and except to the extent inconsistent with thisArticle 4A) apply mutatis mutandis to votes of the Preference Shareholders at any General Meeting. |
4A.12 | The provisions of these presents relating to General Meetings, notice of and proceedings at General Meetings and votes of members of the Company shall (subject to and except |
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to the extent inconsistent with thisArticle 4A) apply mutatis mutandis to any separate Class Meeting. |
4A.21 (1) | Consent by Special Resolution. Any: |
Preference
Shareholders
(a) | consent, approval or sanction of the Preference Shareholders required under thisArticle 4A;and/or | |
(b) | variation, abrogation or other limitation of the rights of the Preference Shareholders as set out in thisArticle 4A, |
(2) | Quorum. The quorum of such Class Meeting shall be Preference Shareholders present in person or by proxy or attorney (or in the case of a corporation by a duly authorised representative) holding or representing at least one-third of all the outstanding Preference Shares. | |
(3) | Resolution in Writing. NotwithstandingArticle 4A.21(1), where a special resolution is not passed at the relevant Class Meeting, consent in writing from the holders of at least three-fourths of the Preference Shares obtained within two months of the Class Meeting shall be as valid and effectual as a special resolution carried at the Class Meeting. |
2.2 | Rights in Respect of Dividends |
Dividends
4A.3 (1) | No Right to Dividends. Subject toArticle 4A.3(2): |
(a) | the Preference Shares shall not confer on the Preference Shareholders any right, and the Preference Shareholders shall have no right, to any dividends paid out of the Distributable Profits of the Company, whether in cash or in kind and whether interim or final; and | |
(b) | neither the Directors nor the Company shall propose, declare, resolve, approve, pay, distribute or make any such dividends in respect of the Preference Shares, |
(2) | Use of Distributable Profits Not Prejudiced. Nothing inArticle 4A.3(1) shall restrict, prohibit or otherwise affect the ability of the Company to: |
(a) | redeem, purchase, reduce or cancel the Preference Shares out of Distributable Profits; or | |
(b) | pay or distribute any amount in respect of the Preference Shares out of Distributable Profits on the liquidation,winding-up or dissolution of the Company, |
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Payment or
Partial
Payment
4A.10 | If, by reason of any provision of the Act or for any reason whatsoever, the Company is unable to make payment of any amount due in respect of the Preference Shares, then the Company shall from time to time (subject to the maximum amount and extent permitted by law, and on the earliest date on which such payments may lawfully be made) make payments on account of the amount so owing on a pro rata basis to the holders of the Preference Shares until such amount has been paid in full. |
4A.20 | Any Preference Shareholder who has failed to claim distributions or other property or rights within six years of their having been made available to it will not thereafter be able to claim such distributions or other property or rights which shall be forfeited and shall revert to the Company. The Company shall retain such distributions or other property or rights but shall not at any time be a trustee in respect of any distributions or other property or rights nor be accountable for any income or other benefits derived from such distributions or other property or rights. |
2.3 | Rights in Respect of Capital |
4A.2 | The Company may allot and issue such number of Preference Shares at such issue price and on such terms and conditions as the Directors may determine, all of which shall carry the rights, benefits and privileges and be subject to the restrictions set out in thisArticle 4A. |
Rights
Attached to
Preference
Shares
4A.5 (1) | No Further Participation. The Preference Shareholders shall have no right to participate in the profits or assets of the Company beyond the rights conferred under thisArticle 4A. |
(2) | No Pre-emptive Rights. The Preference Shareholders shall have no pre-emptive or preferential rights to purchase or subscribe for any shares, rights, warrants, options, obligations or other securities of the Company and shall not be entitled to pro rata subscription rights with respect to future issues by the Company or any of its subsidiaries of Ordinary Shares or ADSs, or securities or rights which are convertible or exchangeable into Ordinary Shares or ADSs. |
Redemption
and
Purchase by
Company
4A.7 (1) | Tax andClean-up Redemption. The Company may at any time prior to the Maturity Date redeem all, but not some only, of the Preference Shares at the Early Redemption Price in the following circumstances: |
(a) | if the Company determines that as a result of: |
(i) | any change in, or amendment to, the laws or regulations of Singapore, or rulings promulgated under any such laws or regulations or by any authority of or in Singapore having power to tax, which change or amendment becomes effective on or after the Issue Date; | |
(ii) | any change in the general application or official or judicial interpretation of any such laws, regulations or rulings, which change becomes effective on or after the Issue Date; or |
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(iii) | any change in the general application or official or judicial interpretation of, or any execution or amendment to, any treaty or treaties affecting taxation to which Singapore is a party, which change, execution or amendment becomes effective on or after the Issue Date, |
(b) | at least 95 per cent. of all Preference Shares issued have been converted, redeemed or purchased and cancelled. |
(2) | Call Redemption. The Company may at any time on or after the second anniversary of the Issue Date and prior to the Maturity Date redeem all or any of the Preference Shares at the Early Redemption Price if the Closing Sale Price of the Ordinary Shares on the SGX-ST for any 20 Trading Days (translated into U.S dollars at the U.S. dollar/Singapore dollar noon buying rate in New York on each of such Trading Days, as certified for customs purposes by the Federal Reserve Bank of New York) in any 45 calendar day period ending not more than five calendar days prior to the date on which notice of such redemption is given is at least 125% of the Conversion Price, as adjusted through, and effective on, such notice date. | |
(3) | Redemption Notice. If the Company elects to redeem the Preference Shares pursuant to thisArticle 4A.7, it shall give not less than 30 calendar days’ and not more than 60 calendar days’ prior notice to the Preference Shareholders, which notice shall be irrevocable. The Company shall also publish such redemption notice in accordance withArticle 4A.22. | |
(4) | Redemption Date. The redemption of any Preference Shares called for redemption pursuant to thisArticle 4A.7 shall be made on the date specified in the relevant redemption notice. | |
(5) | Redemption Opinion. Prior to the redemption of any Preference Shares pursuant toArticle 4A.7(1)(a), the Company shall provide the Redemption Agent with a legal opinion that the conditions precedent to such redemption have occurred. | |
(6) | Purchase by the Company. The Company may, in accordance with all applicable laws and regulations, at any time purchase the Preference Shares in the open market or otherwise at any price. Any Preference Share that the Company purchases will be cancelled, unless it is permitted by applicable law to hold, re-issue or re-sell such Preference Shares. If the Company is permitted by applicable law to purchase and hold the Preference Shares, the Preference Shares so purchased, while held by or on behalf of the Company or any of its |
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subsidiaries or any company (other than a subsidiary) in which at least 20% of its shares are held, directly or indirectly, by the Company: |
(a) | will not entitle the holder to convert the Preference Shares or to vote at any Class Meeting or General Meeting; and | |
(b) | will not be deemed to be outstanding for the purposes of calculating the quorum at any Class Meeting or General Meeting or with respect to any matter requiring a vote of the holders of the Preference Shares or on which holders of the Preference Shares are entitled to vote. |
Redemption
by
Preference
Shareholders
4A.8 (1) | On Fundamental Change. If a Fundamental Change occurs at any time before the close of business on the seventh Business Day prior to the earlier of: |
(a) | the Maturity Date; and | |
(b) | the redemption date fixed for early redemption underArticle 4A.7, |
(2) | Certain Definitions. A “Fundamental Change” occurs if: |
(a) | at any time the Ordinary Shares are not listed on the SGX-ST (or its successor) or the ADSs are not listed or admitted to trade on the New York Stock Exchange, the American Stock Exchange or the Nasdaq National Market (or their respective successors); | |
(b) | (i) Temasek ceases to beneficially own (as such term is defined underRule 13d-3 andRule 13d-5 under the Exchange Act) at least 30% of the Company’s voting securities, (ii) any “person” or “group” (as such terms are used in Sections 13(d) and 14(d) of the Exchange Act) acquires beneficial ownership of the Company’s voting securities that is greater than the beneficial ownership of Temasek of the Company’s voting securities, or (iii) Temasek ceases to control (as defined inArticle 4A.8(4)(c)) the Company; | |
(c) | (i) the Company consolidates with or merges into any other person, or any other person merges with or into the Company, unless the holders of the Ordinary Shares immediately prior to such transaction own, directly or indirectly immediately following such transaction, at least a majority of the combined voting power of all the then outstanding voting securities entitled to vote generally in elections of directors of the continuing or surviving corporation resulting from such transaction or (ii) the Company sells, assigns, conveys, transfers or leases all or substantially all of the assets of the Company and its subsidiaries, taken as a whole, to another person (other than to one or more of the Company’s wholly-owned subsidiaries); |
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(d) | at any time the continuing directors of the Company do not constitute a majority of the Board of Directors of the Company (or, if applicable, a successor corporation to the Company); | |
(e) | (i) the difference between: |
(x) | the sum of (A) the amount standing to the credit of (1) the share premium account of the Company (prior to the Amendment Date) or (2) the share capital account of the Company (at any time on or after the Amendment Date), as the case may be, at any time, plus (B) the retained earnings of the Company (as determined under U.S. GAAP) at that time (if any), minus (C) the accumulated deficit of the Company (as determined under U.S. GAAP) at that time (if any), plus (D) the accumulated other comprehensive income of the Company (as determined under U.S. GAAP) at that time (if any) minus (E) the accumulated other comprehensive loss of the Company (as determined under U.S. GAAP) at that time (if any); and | |
(y) | the redemption amounts that the Company would be required to pay in respect of any other classes of preference shares issued by the Company and outstanding at that time, |
(ii) | after the Amendment Date, at any time the Company would be unable to make a solvency statement (under the Act), assuming the Company were to redeem the Preference Shares and all other classes of preference shares issued by the Company and outstanding at that time; or |
(f) | after the Issue Date, any new law, or amendment to the existing laws of Singapore (other than the amendments proposed by the Companies (Amendment) Act 2005), is passed by the Singapore Parliament (without regard to whether such change in law has become effective), or there is any change in the general application or official or judicial interpretation of such laws, that would (i) prevent the Company from paying, or materially restrict the ability of the Company to pay, the full amount of the Redemption Amount of the outstanding Preference Shares or (ii) restrict materially the convertibility of the Preference Shares. |
(3) | No Right to Redeem. Notwithstanding the foregoing, the Preference Shareholders will not have the right to require the Company to redeem any Preference Shares underArticle 4A.8(2)(b), (c) or (d) (and the Company will |
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not be required to deliver the notice incidental to such Fundamental Change pursuant toArticle 4A.8(5)), if: |
(a) | the Closing Sale Price of the Ordinary Shares on the SGX-ST for any five Trading Days (translated into U.S dollars at the U.S. dollar/Singapore dollar noon buying rate in New York on each of such Trading Day, as certified for customs purposes by the Federal Reserve Bank of New York) within: |
(i) | the period of 10 consecutive Trading Days ending immediately after the later of the effective date of the Fundamental Change or the public announcement of the Fundamental Change, in the case of a Fundamental Change underArticle 4A.8(2)(b) and(d), or | |
(ii) | the period of 10 consecutive Trading Days ending immediately before the effective date of the Fundamental Change, in the case of a Fundamental Change underArticle 4A.8(2)(c), |
(b) | at least 90% of the consideration paid for the Ordinary Shares (excluding cash payments for fractional shares and cash payments made pursuant to dissenters’ appraisal rights) in a merger or consolidation or a conveyance, sale, transfer or lease otherwise constituting a Fundamental Change underArticle 4A.8(2)(c) consists of shares of capital stock (or American Depositary Shares, in the case of a qualifying foreign merger as defined inArticle 4A.8(4)(d)) traded on the New York Stock Exchange or another U.S. national securities exchange or quoted on The Nasdaq Stock Market or another established automatedover-the-counter trading market in the United States or will be so traded or quoted immediately following such Fundamental Change and, as a result of such Fundamental Change, the Preference Shares become convertible into such shares or American Depositary Shares. |
(4) | Certain Definitions. For purposes of thisArticle 4A.8: |
(a) | “capital stock” means (i) in the case of a corporation, corporate stock, (ii) in the case of an association or business entity, shares, interests, participations, rights or other equivalents (however designated) of corporate stock, (iii) in the case of a partnership or limited liability company, partnership or membership interests (whether general or limited) and (iv) any other interest or participation that confers on a person the right to receive a share of the profits and losses of, or distribution of the assets of, the issuing person (for avoidance of doubt, “capital stock” shall not include debt securities convertible or exchangeable into equity interests of the issuing person). | |
(b) | “continuing director” means, as of any date of determination, any member of the Board of Directors of the Company who (i) was a member of the Board of Directors of the Company on the Issue Date or (ii) was nominated for election or elected to the Board of Directors of the |
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Company with the approval of (A) a majority of the continuing directors who were members of the Board of Directors of the Company at the time of such nomination or election or (B) Temasek. |
(c) | “control” means (i) possession, directly or indirectly, of more than 50% of the Company’s voting securities or (ii) the ability, directly or indirectly, to influence any decision of, or to direct or cause the direction of, the Company’s management and policies, including decisions pertaining to operations and maintenance. | |
(d) | “qualifying foreign merger” means a transaction pursuant to which (i) the Company consolidates with or merges into any other person in a transaction in which the Company is not the surviving entity, or conveys, transfers or leases all or substantially all of the Company’s properties and assets to, any person (each such person, a “successor person”); (ii) where the successor person is organized under the laws of a jurisdiction other than Singapore or any U.S. domestic jurisdiction, (iii) the successor person has capital stock or American Depositary Shares representing such capital stock traded on the New York Stock Exchange or U.S. national securities exchange or quoted on The Nasdaq Stock Market or another established automated over-the-counter trading market in the United States, (iv) the successor person has a worldwide total market capitalization of its equity securities (before giving effect to such transaction) of at least US$5 billion, and (v) the successor person has consented to service of process in the United States. | |
(e) | “voting securities” refers to all of the outstanding securities of the Company entitled to vote generally in elections of the Directors. |
(5) | Notice of Fundamental Change. As soon as practicable, but in no event later than five Business Days after the Company becomes aware of the occurrence of a Fundamental Change, the Company will give notice to all holders of the Preference Shares, the Redemption Agent and the Conversion Agent, in accordance withArticle 4A.22. Such notice will state, among other things: |
(a) | the events causing the Fundamental Change; | |
(b) | the effective date of the Fundamental Change; | |
(c) | the Fundamental Change redemption price; | |
(d) | the Fundamental Change redemption date, which will be the earlier of (i) the date falling 45 calendar days from the notice date and (ii) the Maturity Date; | |
(e) | the last date on which a holder may elect to have its Preference Shares redeemed; | |
(f) | the name and address of the Redemption Agent; | |
(g) | the Conversion Price and whether the Fundamental Change is such that the Conversion Price will need to be adjusted underArticle 4A.17(9); |
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(h) | the period during which a Conversion Notice can be delivered to the Conversion Agent for the conversion to be deemed to be in connection with a Fundamental Change underArticle 4A.17(9), which period shall not in any event extend beyond the Maturity Date; | |
(i) | that the Preference Shares with respect to which a Fundamental Change redemption notice has been given by the holder may be converted only if the holder withdraws the Fundamental Change redemption notice by a written notice of withdrawal delivered to the Redemption Agent prior to the close of business on the Business Day prior to the Fundamental Change redemption date; and | |
(j) | the procedures that holders must follow to require the Company to redeem their Preference Shares (including the procedures described inArticle 4A.8(6)). |
(6) | Redemption Notice. Each holder electing to have any of its Preference Shares redeemed under thisArticle 4A.8 must deliver a written notice (in substantially the form for the time being approved by the Company and available from the Redemption Agent) to the Company and the Redemption Agent at least 10 calendar days prior to the redemption date. The notice must specify the number of Preference Shares submitted for redemption. | |
(7) | Solvency Statement. Notwithstanding anything in thisArticle 4A, but without prejudice to the rights of the holders of the Preference Shares to require the Company to redeem their Preference Shares in accordance with thisArticle 4A.8, in no event shall the Company be required to make a solvency statement except when required to do so under the Act. |
Procedures
4A.9 (1) | Obligations of Redeeming Holder. On or before any date fixed for redemption of any Preference Shares, each Preference Shareholder whose Preference Shares are to be redeemed shall be bound to: |
(a) | deliver to the Company the share certificates in respect of those Preference Shares to be redeemed which are held by him, in order that the same may be cancelled; or | |
(b) | at the election of a holder of any global certificate representing the Preference Shares, make an appropriate notation on such global certificate indicating a reduction in the number of Preference Shares represented by such global certificate by the number of Preference Shares to be redeemed. |
(2) | Obligations of Company. Upon and subject to the delivery of the relevant share certificates (or an appropriate form of indemnity) or the making of the appropriate notation as described above on such date or thereafter, the Company shall: |
(a) | pay promptly to each such holder (or in the case of joint holders, to the holder whose name stands first in the Register of Preference Shareholders) the amount due to him in respect of such redemption in accordance with thisArticle 4A.9; and |
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(b) | issue to each such holder the balancing certificate (if any) in respect of any Preference Shares held by him which are not redeemed. |
(3) | Payments. The Company shall pay all amounts payable on the redemption of the Preference Shares: |
(a) | in immediately available funds by wire transfer of funds in U.S. dollars to an account with a bank in New York City specified by each Preference Shareholder; or | |
(b) | by despatch of a U.S. dollar cheque drawn on a bank in New York City to each Preference Shareholder at its registered address for the time being. |
(4) | When Preference Shares Cease to be Outstanding. If the Redemption Agent holds money or securities sufficient to pay the amount payable for the redemption of any Preference Shares on the Business Day following the date fixed for the redemption of such Preference Shares, then, immediately after such redemption date, such Preference Shares shall cease to be outstanding, whether or not delivery of the relevant share certificates (or an appropriate form of indemnity) or the making of the appropriate notation as described above is made. At such time, all rights of the holder(s) of such Preference Shares shall terminate, other than the right to receive the amount payable for the redemption of such Preference Shares upon such delivery or notation. | |
(5) | Payments to Joint Holders. All payments with respect to the Preference Shares held jointly by two or more persons shall be paid or made to whichever of such persons is named first in the Register of Preference Shareholders and the making of any payment or distribution in accordance with thisArticle 4A.9(5) shall discharge the liability of the Company in respect thereof. |
Preference
Shares
4A.13 (1) | Senior Shares Deemed a Variation. Without prejudice to the generality ofArticle 4A.21, the authorization, creation (by way of reclassification or otherwise) or issue by the Company of shares that rank senior in priority to the Preference Shares with respect to rights upon liquidation,winding-up or dissolution shall: |
(a) | be deemed to constitute a variation of the rights attached to the Preference Shares; and | |
(b) | require the consent of the Preference Shareholders underArticle 4A.21. |
(2) | Pari Passu or Junior Shares Not a Variation. The authorization, creation (by way of reclassification or otherwise) or issue by the Company of shares (including any obligation or security convertible or exchangeable into, or evidencing a right to purchase, shares) that: |
(a) | rank pari passu with or junior to the Preference Shares with respect to rights upon liquidation,winding-up or dissolution (including, without limitation, the Parity Shares); or | |
(b) | confer on the holders thereof a right to any dividends out of the Distributable Profits of the Company, |
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Premium and
Share
Capital
Accounts
4A.14 (1) | Preference Shares Issued Before Amendment Date. In relation to any Preference Shares issued prior to the Amendment Date, such Preference Shares may only be redeemed out of the share premium account of the Company if the Company satisfies the solvency test for such redemption under the Act as amended by the Companies (Amendment) Act 2005, to the extent such satisfaction is required by law or, in the absence of a Singapore court decision to this effect, to the extent that the Company is so advised by its counsel. |
(2) | All Preference Shares. So long as any of the Preference Shares remains outstanding: |
(a) | the Company shall ensure that the difference between: |
(i) | the sum of (A) the amount standing to the credit of (I) the share premium account of the Company (prior to the Amendment Date) or (II) the share capital account of the Company (at any time on or after the Amendment Date), as the case may be, at any time, plus (B) the retained earnings of the Company (as determined under U.S. GAAP) at that time (if any), minus (C) the accumulated deficit of the Company (as determined under U.S. GAAP) at that time (if any), plus (D) the accumulated other comprehensive income of the Company (as determined under U.S. GAAP) at that time (if any) minus (E) the accumulated other comprehensive loss of the Company (as determined under U.S. GAAP) at that time (if any); and | |
(ii) | the redemption amounts that the Company would be required to pay in respect of any other classes of preference shares issued by the Company and outstanding at that time, |
(b) | after the Amendment Date, the Company shall use all reasonable endeavours to ensure that at all times the Company would be able to make a solvency statement (in accordance with Singapore law), assuming the Company were to redeem the Preference Shares and all other classes of preference shares issued by the Company and outstanding at that time. |
Conversion
4A.16 (1) | Conversion Right. Subject to the further provisions of thisArticle 4A.16, a Preference Shareholder may convert all or any of its Preference Shares into Ordinary Shares during such hours as may be agreed between the Company and the Conversion Agent on any Business Day during the Conversion Period at the Conversion Price then in effect. |
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(2) | Conversion Period. A Preference Shareholder may convert its Preference Share into Ordinary Shares during such hours as may be agreed between the Company and the Conversion Agent on any Business Day during the period (“Conversion Period”): |
(1) | commencing 40 calendar days after the Issue Date; and | |
(2) | ending on the date falling seven Business Days prior to the earlier of: |
(a) | in the case of any Preference Share called for redemption pursuant toArticle 4A.7 or4A.8, the date fixed for such redemption (unless the Company shall default in making the redemption payment, provided that in no event shall any such conversion right extend beyond the Maturity Date); or | |
(b) | the Maturity Date. |
(3) | Number of Ordinary Shares Deliverable on Conversion. The number of Ordinary Shares to be delivered pursuant to the conversion of the Preference Shares shall be determined by dividing the Redemption Amount of all Preference Shares to be converted by a holder by the Conversion Price in effect on the relevant Conversion Date. | |
(4) | Conversion into Ordinary Shares. Upon conversion of any Preference Share: |
(a) | such Preference Share shall cease to carry any of the rights, benefits, privileges, preference or priority, and shall cease to be subject to any of the restrictions, set out in thisArticle 4A; | |
(b) | the holder of such Preference Share shall cease to have any right as such holder with respect to such Preference Share; | |
(c) | the delivery to such Preference Shareholder, subject to applicable laws and in accordance with these presents, of the fixed number of Ordinary Shares or ADSs into which such Preference Share is convertible shall be deemed to satisfy and discharge the Company’s obligation in respect of such Preference Share; and | |
(d) | the Ordinary Shares deliverable pursuant to such conversion shall be issued credited as fully paid and shall rank pari passu in all respects with all other Ordinary Shares of the Company then in issue (save for any dividend, rights or other distributions the record date for which is before the relevant Conversion Date). |
(5) | Conversion into ADSs. A Preference Shareholder may elect to receive Ordinary Shares deliverable upon the conversion of its Preference Shares in the form of ADSs. In such event, the Company shall, on behalf of such Preference Shareholder, as soon as practicable, subject to applicable laws and in accordance with these presents, deliver to and deposit with the ADS depositary, in accordance with the terms of the ADS Deposit Agreement, such number of Ordinary Shares such Preference Shareholder would have received upon conversion had it not elected to receive such Ordinary Shares in the form of |
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ADSs. Subject to compliance with the terms of the ADS Deposit Agreement, including payment of the fees and expenses of the ADS depositary by such Preference Shareholder, the ADS depositary will issue such number of ADSs representing the deposited Ordinary Shares to such Preference Shareholder based on the applicableshare-to-ADS ratio then in effect. |
(6) | Manner of Effecting Conversion. Conversion of the Preference Shares shall be effected in such manner as the Directors shall, subject to these presents and as the Act or other applicable laws or regulations may allow, from time to time determine. |
(7) | Conversion Notice. To convert a Preference Share, a Preference Shareholder must at its own risk and expense deliver, during such hours as may be agreed between the Company and the Conversion Agent, to the Conversion Agent, at its specified office, a duly completed and signed conversion notice (in substantially the form for the time being approved by the Company and available from the Conversion Agent) (“Conversion Notice”), accompanied by: |
(a) | the share certificate in respect of such Preference Share (if a definitive share certificate has been issued in respect of the Preference Share being converted) or such other documents or evidence (if any) as the Directors may reasonably require to prove the title and claim of the person exercising such right (or, if such certificates have been lost or destroyed, such evidence of title and such indemnity as the Directors may require); or | |
(b) | at the election of a holder of any global certificate representing the Preference Shares, an appropriate notation on such global certificate indicating a reduction in the number of Preference Shares represented by such global certificate by the number of Preference Shares to be converted. |
(8) | Conversion Date. The date on which a converting Preference Shareholder satisfies all of the requirements set out inArticle 4A.16(7) andArticle 4A.16(13)(a) is the “Conversion Date.” | |
(9) | Incomplete/Incorrect Conversion Notice. A Conversion Notice that is incomplete or incorrect may be rejected. All costs and expenses incurred by an incomplete or incorrect Conversion Notice will be for the account of the relevant Preference Shareholder. |
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(10) | Delivery of Ordinary Shares. No Preference Shareholder shall be entitled to receive physical share certificates in respect of the Ordinary Shares arising from the conversion of the Preference Shares. Delivery of the Ordinary Shares shall be made by crediting such Ordinary Shares to the Securities Account of, or designated by, the Preference Shareholder. Unless the Company shall have waived this requirement, a converting Preference Shareholder shall deliver a copy of the Conversion Notice to the Company at its registered office (marked for the attention of the Company Secretary). The Company shall deliver the Ordinary Shares arising from the conversion of the Preference Shares to the Securities Account set out in the Conversion Notice as soon as practicable after the Conversion Date, and in any event not later than seven calendar days after the later of (a) the Conversion Date and (b) unless this requirement is waived by the Company, the date on which the converting Preference Shareholder delivers a copy of the Conversion Notice to the Company (subject to all applicable laws and in accordance with these presents). | |
(11) | Entitlements and Record Dates. A holder of Ordinary Shares delivered on conversion of Preference Shares shall not be entitled to any rights of a shareholder the record date for which precedes the date on which the Ordinary Shares are credited to its Securities Account (the “Registration Date”). If the record date for the payment of any dividend or other distribution in respect of the Ordinary Shares is on or after the Conversion Date in respect of any Preference Shares converted, but before the Registration Date, the Company shall pay to the converting Preference Shareholder an amount equal to any such dividend or other distribution to which it would have been entitled had it on that record date been such a shareholder of record of such number of Ordinary Shares delivered upon conversion (without making any retroactive adjustment of the Conversion Price pursuant toArticle 4A.17), and will make such payment at the same time as it makes payment of the dividend or other distribution, or as soon as practicable thereafter, but, in any event, not later than seven calendar days thereafter. | |
(12) | Fractions and Balancing Certificates. Fractions of an Ordinary Share shall not be delivered on conversion and no cash adjustments or payment shall be made in respect of any such fraction. Where a Preference Shareholder has elected to receive Ordinary Shares deliverable upon conversion of its Preference Shares in the form of ADSs, fractions of an ADS (and such number of Ordinary Shares representing such fraction of an ADS) shall not be delivered on conversion and no cash adjustments or payment shall be made in respect of any such fraction. |
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(13) | Taxes and Charges. As conditions precedent to conversion, the Preference Shareholder must pay: |
(a) | any taxes and capital, stamp, issue and registration duties arising on conversion, other than any taxes or capital or stamp duties payable in Singapore in respect of the allotment, issue and delivery of the Ordinary Shares and listing of the Ordinary Shares upon conversion; and | |
(b) | any tax or duty relating to any disposal or any deemed disposal relating to conversion and transfer involved in the issue or delivery of the Ordinary Shares upon conversion, other than any withholding or deduction for any Singapore tax (as defined inArticle 4A.19), in which case the provisions ofArticle 4A.19 shall apply to such withholding or deduction. |
The Company shall pay all other expenses arising on the issue, allotment and delivery of the Ordinary Shares deliverable upon conversion. If a Preference Shareholder elects to receive Ordinary Shares upon conversion in the form of ADSs, the Preference Shareholder shall pay the fees and expenses of the ADS depositary pursuant to the ADS Deposit Agreement in addition to all amounts pursuant to thisArticle 4A.16(13). | ||
(14) | Listing. So long as the Ordinary Shares in issue are listed on the SGX-ST and the ADSs are listed on Nasdaq, the Company shall use all reasonable endeavours to procure that all the Ordinary Shares or ADSs, as the case may be, into which Preference Shares are converted are admitted for listing on the SGX-ST or Nasdaq, as the case may be, at the earliest practicable date following conversion. | |
(15) | Undertakings. So long as any Preference Shares remain capable of being converted into Ordinary Shares or ADSs, then, save with such consent or sanction on the part of the Preference Shareholders as is required for a variation of the rights attached to such Preference Shares: |
(a) | if the Company is placed in liquidation, the Company shall forthwith give notice thereof in writing to all Preference Shareholders and such notice shall be published as specified inArticle 4A.22. |
Each Preference Shareholder shall, in respect of all or any of its Preference Shares, be entitled within 42 calendar days after the date of the resolution forwinding-up the Company or (as the case may be) after the date of the order of the Court forwinding-up, by notice in writing to the Company, elect to be treated as if: |
(i) | its right to convert its Preference Share had been exercisable and had been exercised prior to the commencement of suchwinding-up; and |
(ii) | the Conversion Date for such conversion had been the date immediately preceding the date of such commencement. |
In that event, such Preference Shareholder shall be entitled to be paid, in satisfaction of the amount due in respect of such of its Preference Shares as are to be treated as if converted, a sum equal to the amount to which it |
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would have become entitled in suchwinding-up if it had been the holder of the Ordinary Shares to which it would have become entitled by virtue of such conversion, fractions being disregarded for this purpose (and in respect of its entitlement to receive such sum it shall rank pari passu with the holders of Ordinary Shares). |
At the expiration of the said period of 42 calendar days, any outstanding Preference Shares shall cease to be capable of being treated as if converted; |
(b) | the Company shall not make any issue, offer or distribution or take any other action the effect of which would be that, on the conversion of any Preference Shares, the Company would be required to issue Ordinary Shares at a discount to their par value; |
(c) | the Company shall procure that there shall be sufficient authorised but unissued share capital available for the purposes of satisfying the requirements of any Conversion Notice as may be given by any Preference Shareholder; and |
(d) | the Company shall use all reasonable endeavours to obtain and maintain a listing for the Preference Shares on the SGX-ST. |
4A.17 (1) | General. The Conversion Price per Ordinary Share shall be adjusted from time to time by the Company in accordance with thisArticle 4A.17. |
In each case, the adjusted Conversion Price is determined by multiplying the Conversion Price before adjustment, denoted as “P”, by an applicable adjustment factor. The formulae for determining the adjustment factors are set forth in the following subsections. In each case, the Conversion Price will be adjusted with effect from the applicable Adjustment Effective Date. |
(2) | Share Dividends, Share Splits and Consolidations. If the Company: |
(a) | pays a dividend or makes a distribution on the Ordinary Shares in the form of Ordinary Shares; | |
(b) | splits or reclassifies the outstanding Ordinary Shares into a greater number of Ordinary Shares; or | |
(c) | consolidates or reclassifies the outstanding Ordinary Shares into a lesser number of Ordinary Shares, |
the Conversion Price will be adjusted as follows: |
Adjusted Conversion Price | = | P | × | X | ||||
Y |
where: | ||
“X” means the number of Ordinary Shares outstanding immediately prior to the effectiveness of the relevant event giving rise to the adjustment; and |
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(i) | in the case of paragraph (a) above, shall be the record date set by the Company for the relevant dividend or distribution giving rise to the adjustment; and | |
(ii) | in the case of paragraphs (b) and (c) above, shall be the date on which the relevant split, consolidation or reclassification giving rise to the adjustment becomes effective. |
(3) | Issuances of Ordinary Shares and Rights. If: |
(a) (i) | the Company issues or distributes Ordinary Shares (other than as described inArticle 4A.17(2)(a)); or |
(ii) | the Company or any of its subsidiaries issues or distributes any securities or rights which are convertible into or exchangeable for Ordinary Shares, or issues or distributes any warrants or rights to purchase or subscribe for Ordinary Shares, |
in each case, to all or substantially all holders of the Ordinary Shares; and |
(b) | the applicable issuance, distribution, conversion, exchange, purchase or subscription price per Ordinary Share, after taking into account any per Ordinary Share consideration received by the Company in respect of such issuance or distribution, is below 95% of the Average Market Price as of the date of announcement of details concerning such applicable issuance, distribution, conversion, exchange, purchase or subscription price, |
Adjusted Conversion Price | = | P | × | (S + f) | ||||
(S + a) |
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(4) | Issuances and Distributions of Securities, Assets and Related Rights. If the Company issues or distributes, for less than 95% of their fair market value (as defined below), to all or substantially all holders of the Ordinary Shares, any: |
(a) | securities other than securities addressed byArticle 4A.17(2), (3) or(6); | |
(b) | assets, other than dividends addressed byArticle 4A.17(5) or(6), or | |
(c) | rights to acquire the securities or assets described inArticles 4A.17(4)(a) and(b), |
Adjusted Conversion Price | = | P | × | (M − d) | ||||
M |
(5) | Cash Dividends. If the Company issues or distributes a dividend in the form of cash, the Conversion Price will be adjusted as follows: |
Adjusted Conversion Price | = | P | × | (M − e) | ||||
M |
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(6) | Spin-Offs. If the Company pays a dividend or makes a distribution to all or substantially all holders of Ordinary Shares consisting of shares of any class or series, or similar equity interests, of or relating to any of its subsidiaries or other business units, the Conversion Price will be adjusted as follows: |
Adjusted Conversion Price = P × | D D+v |
(7) | Other Adjustments. If the Company determines that any other adjustment should be made to the Conversion Price in the case of a dilutive event that is not specifically addressed byArticles 4A.17(2) to (6), the Company will make such adjustment that is fair and reasonable in the opinion of its Directors. | |
(8) | General Adjustment Provisions. The following provisions shall apply, where applicable, to any adjustment pursuant to thisArticle 4A.17: |
(a) | the Conversion Price may not be reduced so that, on conversion, Ordinary Shares would be issued at a discount to their par value. Except in the case of a consolidation or reclassification of Ordinary Shares pursuant toArticle 4A.17(2)(c), the Conversion Price will not be increased as a result of any adjustment; |
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(b) | in case of an adjustment underArticle 4A.17(2), (3), (4), (5) or(6), if the actual amount of adjustment cannot be determined on such record date because certain terms of issuance or distribution have not been determined, the Company may elect to defer the effectiveness of such adjustment until it can be determined and such adjustment will take effect retroactively from the record date set for such issuance or distribution. In such case, the Company shall deliver additional Ordinary Shares, as a result of such adjustment, to any Preference Shareholders who converted their Preference Shares between such record date and the date on which such adjustment is determinable; | |
(c) | if a Conversion Date falls prior to the Adjustment Effective Date of an adjustment of the Conversion Price and the relevant Registration Date of the Ordinary Shares deliverable upon conversion falls on or after such Adjustment Effective Date, the Company shall deliver to the relevant holder the additional number of Ordinary Shares to which that holder would have been entitled had the relevant Conversion Date fallen immediately following the Adjustment Effective Date; | |
(d) | no adjustment will be made to the Conversion Price where the adjustment, rounded to the nearest cent as provided below, if applicable, would be less than one per cent. of the Conversion Price then in effect. On any adjustment, the resulting Conversion Price will be rounded to the nearest cent (or the smaller of the nearest cent in the case of two equally near cents). Any adjustment not required to be made and any amount by which the Conversion Price will be rounded will be carried forward and taken into account in any subsequent adjustment; | |
(e) | no adjustment will be made to the Conversion Price where Ordinary Shares or other securities, options or rights to subscribe for or purchase Ordinary Shares or other securities are issued pursuant to any stock option or purchase programs, plans or similar arrangements approved by the Board of Directors or the shareholders of the Company; | |
(f) | the Company may, from time to time to the extent permitted by applicable law, reduce the Conversion Price of the Preference Shares, at the sole discretion of the Board of Directors, by any amount for any period of at least 20 calendar days, in which case the Company shall give at least 15 calendar days’ notice of such decrease. The Company may, at its option, make such reductions in the Conversion Price, in addition to those set forth above, as the Board of Directors deems advisable to avoid or diminish any income tax to holders of Ordinary Shares resulting from any dividend or distribution of Ordinary Shares (or rights to acquire Ordinary Shares) or from any event treated as such for income tax purposes; | |
(g) | whenever the Conversion Price has been adjusted, the Company shall promptly notify the Preference Shareholders in the manner prescribed byArticle 4A.22; and |
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(h) | if any doubt arises as to the appropriate adjustment to the Conversion Price, a certificate of the Company’s Auditors will be conclusive and binding on all concerned except in the case of manifest error. |
(9) | Adjustment to Conversion Price Upon Certain Fundamental Changes. |
(a) | If a Preference Shareholder converts its Preference Shares in connection with a Fundamental Change described inArticle 4A.8(2)(b),(c) or(d) (subject to certain exceptions as described below in thisArticle 4A.17(9) and the Company’s rights underArticle 4A.18), the Company will decrease the Conversion Price for the Preference Shares surrendered for conversion as described below in thisArticle 4A.17(9). However, no decrease will be made in the case of a Fundamental Change underArticle 4A.8(2)(c) where at least 90% of the consideration paid for the Ordinary Shares (excluding cash payments for fractional shares and cash payments made pursuant to dissenters’ appraisal rights) in a merger or consolidation or a conveyance, sale, transfer or lease otherwise constituting such Fundamental Change consists of shares of capital stock (or American Depositary Shares, in the case of a qualifying foreign merger as described underArticle 4A.8(4)(d)) traded on the New York Stock Exchange or another U.S. national securities exchange or quoted on The Nasdaq Stock Market or another established automated over-the-counter trading market in the United States or will be so traded or quoted immediately following such Fundamental Change and, as a result of such Fundamental Change, the Preference Shares become convertible into such shares or American Depositary Shares. | |
(b) | A conversion of Preference Shares by a holder will be deemed for these purposes to be “in connection with” a Fundamental Change if the Conversion Notice is received by the Conversion Agent on or subsequent to the effective date of the Fundamental Change and prior to the earlier of the Maturity Date and the 45th calendar day following the effective date of the Fundamental Change (or, if earlier and to the extent applicable, the close of business on the second Business Day immediately preceding the Fundamental Change redemption date (as specified in the notice of Fundamental Change described underArticle 4A.8(5))). | |
(c) | The decreased Conversion Prices that will apply to conversions pursuant to thisArticle 4A.17(9) will be determined by the Directors in their absolute discretion after the Conversion Price has been determined on or prior to the Issue Date. The decreased Conversion Prices will be set forth in a table, in a |
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form similar to the following, with such changes as the Directors may determine to make in their absolute discretion: |
Stock Price | ||||||||||||||||||||||||||||||||||||
Effective Date of Fundamental Change | S$x.xx | S$x.xx | S$x.xx | S$x.xx | S$x.xx | S$x.xx | S$x.xx | S$x.xx | S$x.xx | |||||||||||||||||||||||||||
Issue Date | ||||||||||||||||||||||||||||||||||||
1st Anniversary of Issue Date | ||||||||||||||||||||||||||||||||||||
2nd Anniversary of Issue Date | ||||||||||||||||||||||||||||||||||||
3rd Anniversary of Issue Date | ||||||||||||||||||||||||||||||||||||
4th Anniversary of Issue Date | ||||||||||||||||||||||||||||||||||||
5th Anniversary of Issue Date |
(d) | The decreased Conversion Price for a conversion pursuant to thisArticle 4A.17(9) will be determined by reference to the effective date of the Fundamental Change and the “stock price” on such date, which will be determined as follows: |
(i) | if holders of the Ordinary Shares receive only cash in such Fundamental Change transaction, the stock price will be the cash amount paid per Ordinary Share; and | |
(ii) | otherwise, the stock price will be the average of the Closing Sale Price of the Ordinary Shares on each of the five consecutive Trading Days prior to but not including the effective date of such Fundamental Change. |
(e) | The exact stock price amount and the effective date that is applicable for any particular Fundamental Change may not be set forth in the table. In this case, if the stock price is: |
(i) | between two stock price amounts in the table or the effective date is between two dates in the table, the Conversion Price will be determined by straight-line interpolation between the Conversion Prices set forth in the table for the higher and lower stock price amounts and the two dates, as the case may be, based on a365-day year; | |
(ii) | less than the lowest stock price listed in the table (as adjusted as described inArticle 4A.17(9)(f), if applicable), the Conversion Price will not be decreased; and | |
(iii) | more than the highest stock price listed in the table (as adjusted as described inArticle 4A.17(9)(f), if applicable), the Conversion Price will not be decreased. |
(f) | The stock prices set forth in the first row of the table (that is, the column headers) will be adjusted as of any date on which the Conversion Price of the Preference Shares is adjusted underArticle 4A.17. The adjusted stock prices will equal the stock prices applicable immediately prior to such adjustment, multiplied by a fraction, the numerator of which is the Conversion Price as so adjusted and the denominator of which is the |
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Conversion Price immediately prior to the event giving rise to the Conversion Price adjustment. The Conversion Prices in the table also will be adjusted as of such dates in the same manner as the Conversion Price underArticle 4A.17. |
Acquirer
Change of
Control
4A.18 (1) | Adjustment to Conversion Price. Notwithstanding the foregoing, in the case of a Public Acquirer Change of Control, the Company may, in lieu of permitting a redemption at the holder’s option or adjusting the Conversion Price underArticle 4A.17(9), elect to adjust the Conversion Price and the related conversion obligation such that from and after the effective date of such Public Acquirer Change of Control, holders of the Preference Shares will be entitled to convert their Preference Shares into a number of shares of Public Acquirer Shares (as defined below) by multiplying the Conversion Price in effect immediately before the Public Acquirer Change of Control by a fraction: |
(a) | the numerator of which will be the average of the Closing Sale Prices of the Public Acquirer Shares for the five consecutive Trading Days prior to but excluding the effective date of such Public Acquirer Change of Control; and | |
(b) | the denominator of which will be (i) in the case of a share exchange, consolidation or merger, pursuant to which the Ordinary Shares are converted into cash, securities or other property, the value of all cash and any other consideration (as determined by the Board of Directors) paid or payable per Ordinary Share or (ii) in the case of any other Public Acquirer Change of Control, the average of the Closing Sale Prices of the Ordinary Shares for the five consecutive Trading Days prior to but excluding the effective date of such Public Acquirer Change of Control. |
(2) | Public Acquisition Notice. In the case of a Public Acquirer Change of Control, the Company will notify all holders of the Preference Shares, the Conversion Agent and the Redemption Agent 15 calendar days before the expected effective date of such Fundamental Change (the“Public Acquisition Notice”) whether the Company will: |
(a) | elect to adjust the Conversion Price and related conversion obligation under thisArticle 4A.18, in which case the holders will not have the right to require the Company to redeem their Preference Shares underArticle 4A.8(1) and will not have the right to the Conversion Price adjustment underArticle 4A.17(9); or | |
(b) | not elect to adjust the Conversion Price and related conversion obligation under thisArticle 4A.18, in which case the holders will have the right to require the Company to redeem their Preference Shares underArticle 4A.8(1)and/or the right to the Conversion Price adjustment underArticle 4A.17(9). |
(3) | Certain Definitions. A “Public Acquirer Change of Control” means any event (a) constituting a Fundamental Change that would otherwise give holders the right to cause the Company to redeem the Preference Shares underArticle 4A.8(1), where (b) the acquirer has a class of capital stock (or American Depositary Shares |
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representing such capital stock) traded on the New York Stock Exchange or another U.S. national securities exchange or quoted on The Nasdaq Stock Market or another established automated over-the-counter-trading market in the United States or will be so traded or quoted immediately following such Fundamental Change (the “Public Acquirer Shares”). If an acquirer does not itself have a class of capital stock (or American Depositary Shares representing such capital stock) satisfying the foregoing requirement, it will be deemed to have “Public Acquirer Shares” if either (i) a direct or indirect majority-owned subsidiary of acquirer or (ii) a corporation that directly or indirectly owns at least a majority of the acquirer, has a class of capital stock (or American Depositary Shares representing such capital stock) satisfying the foregoing requirement; and in each case such person has taken all necessary action to ensure that upon conversion of the Preference Shares into such class of capital stock, such class of capital stock will not be treated as “restricted securities” and will otherwise be eligible for immediate sale in the public market by non-affiliates of the Company absent a registration statement. In such case, all references to Public Acquirer Shares will refer to such class of capital stock. “Majority-owned” for these purposes means having “beneficial ownership” (as defined inRules 13d-3 and 13d-5 of the Exchange Act) of more than 50% of the total voting power of all shares of the respective entity’s outstanding securities that are entitled to vote generally in the election of directors. |
(4) | General Adjustment Provisions. The provisions ofArticle 4A.17(8) shall apply mutatis mutandis to any adjustment pursuant to thisArticle 4A.18. |
preference
shareholders.
5 (A) | Preference shares may be issued subject to such limitation thereof as may be prescribed by any Stock Exchange. Preference shareholders shall have the same rights as ordinary shareholders as regards receiving of notices, reports and balance sheets and attending General Meetings of the Company, and preference shareholders shall also have the right to vote at any meeting convened for the purpose of reducing the capital orwinding-up or sanctioning a sale of the undertaking or where the proposal to be submitted to the meeting directly affects their rights and privileges or when the dividend on the preference shares is more than six months in arrear. |
(B) | The Company has power to issue further preference capital ranking equally with, or in priority to, preference shares already issued. |
issue of
further
shares with
special rights.
6 (B) | The special rights attached to any class of shares having preferential rights shall not unless otherwise expressly provided by the terms of issue thereof be deemed to be varied by the creation or issue of further shares ranking as regards participation in the profits or assets of the Company in some or all respectspari passu therewith but in no respect in priority thereto. |
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Second Quarter 2009 | Third Quarter 2009 | |||||
Actual | Midpoint and range | |||||
Net revenue(1) (US$) | $349.0M | $410M, ± $5M | ||||
Gross profit (US$) | $30.9M | $81M, ± $5M | ||||
Net income (loss)(US$)(2) | ($39.4M) | ($4M), ± $4M | ||||
Basic earnings (loss) per American Depositary Share (“ADS”)(2) (3)(US$) | ($0.50) | ($0.07), ± $0.04 | ||||
Second Quarter 2009 | Third Quarter 2009 | |||||
Actual | Midpoint and range | |||||
Chartered’s share of SMP revenue(4) (US$) | $19.8M | $25M | ||||
Net revenue including Chartered’s share of SMP(4) (US$) | $368.8M | $435M, ± $6M | ||||
Average selling price (“ASP”) per wafer(5) (US$) | $921 | $875, ± $15 | ||||
ASP per wafer of Chartered’s share of SMP revenue(4) (5) | $755 | $750 | ||||
ASP per wafer including Chartered’s share of SMP(4) (5) (US$) | $910 | $867, ± $20 | ||||
Utilization(6) | 60% | 74%, ± 2% | ||||
(1) | Determined in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”). | |
(2) | The net income (loss) per share and basic earnings (loss) per ADS do not comprehend the expenses Chartered may incur in connection with the proposed acquisition of Chartered by ATIC International Investment Company LLC (the “Acquiror”) by way of a scheme of arrangement under Section 210 of the Companies Act, Chapter 50 of Singapore (the “Scheme”) that was announced on 7 September 2009 (the “Acquisition”). | |
(3) | Basic earnings (loss) per ADS is computed by deducting from net income or adding to net (loss) the accretion to redemption value of our convertible redeemable preference shares, projected to be approximately US$2.6 million in third quarter 2009. | |
(4) | We have provided the information above on our total business base revenue, which includes our share of SMP revenue. Chartered’s share of SMP revenue, and net revenue including Chartered’s share of SMP, presented in the table above arenon-U.S. GAAP financial measures. We have included this information because SMP can have a material effect on our |
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consolidated statements of operations and we believe that it is useful to provide information on our share of SMP revenue in proportion to our total business base revenue. However, SMP is a joint venture company that is not consolidated under U.S. GAAP. We account for our 49.0% investment in SMP using the equity method. Under our strategic alliance agreement with LSI Technology Singapore Pte. Ltd., the majority shareholder, the parties do not share SMP’s net results in the same ratio as the equity holdings. Instead, each party is entitled to the gross profits from sales to the customers that it directs to SMP, after deducting its share of the overhead costs of SMP. Accordingly, we account for our share of SMP’s net results based on the gross profits from sales to the customers that we direct to SMP, after deducting our share of the overhead costs. The table above provides a reconciliation showing comparable data based on net revenue determined in accordance with U.S. GAAP, which does not include our share of SMP and ASP including Chartered’s share of SMP that indicates the effect of SMP’s operations on some of ournon-U.S. GAAP performance indicators. | ||
(5) | Eight-inch equivalent wafers. | |
(6) | Based on total shipments and total capacity, both of which include our share of SMP. |
1. | Net revenue |
2. | Cost of revenue |
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3. | Other revenue |
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4. | Research and development expenses |
5. | Sales and marketing expenses |
6. | General and administrative expenses |
7. | Other operating expenses, net |
8. | Interest income |
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9. | Interest expense |
10. | Taxation |
1. | Accounting standards |
2. | Foreign exchange rates |
SGD 1 | = | USD0.69432 | ||||||
JPY 1 | = | USD0.01055 | ||||||
EUR 1 | = | USD1.42218 |
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3. | Other assumptions |
(i) | No material adverse effect from any changes in the economic and financial positions of the Company, our suppliers or our customers; | |
(ii) | No material decline in value of investments which requires material impairment to the carrying values of investments of the Company; | |
(iii) | No material decline in value of property, plant and equipment that requires material impairment to the carrying values of property, plant and equipment of the Company; | |
(iv) | No changes in estimated useful lives or residual values of property, plant and equipment; | |
(v) | No material changes in obsolescence and impairment of inventory; | |
(vi) | No significant disruptions arising from industrial disputes or the supply of labor or other causes that will affect the operations of the Company; | |
(vii) | No material changes in inflation rates; | |
(viii) | No material changes in the principal activities of the Company; | |
(ix) | No material changes in the management and organization structure of the Company; and | |
(x) | No material changes in the existing economic, political, legal or regulatory and social conditions affecting the activities of the Company or the industry, countries or the markets in which we operate. | |
(xi) | The Acquisition will not complete before 1 October 2009. Furthermore, the completion of the Acquisition is subject to customary conditions, such as regulatory and shareholder approvals, the achievement of which are inherently uncertain. Accordingly, to the extent that expenses are contingent on the completion of the Acquisition, such expenses are not included in the Forecast. |
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![(DEUTSCHE BANK LOGO)](https://capedge.com/proxy/6-K/0000950123-09-049467/z00367z0036709.gif)
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Sandeep Pahwa | Suneet Weling | |
Managing Director | Director |
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(A) | In this Scheme of Arrangement, unless inconsistent with the subject or context: |
(i) | the following expressions shall bear the following meanings: |
“Abu Dhabi” | The Emirate of Abu Dhabi, United Arab Emirates; | |
“Acquiror” | ATIC International Investment Company LLC, a company incorporated in Abu Dhabi and having its offices at Mamoura Building A, Muroor Road, Abu Dhabi; | |
“Acquisition” | the proposed acquisition of all the Scheme Shares by the Acquiror by way of this Scheme; | |
“ACRA” | the Accounting and Corporate Regulatory Authority of Singapore; | |
“ADRs” | the certificates issued by the ADS Depositary to evidence the ADSs issued under the terms of the ADS Deposit Agreement, as such ADRs may be amended from time to time in accordance with the provisions of the ADS Deposit Agreement; |
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“ADSs” | the rights and interests in the Company Shares deposited under the ADS Deposit Agreement granted to the ADS Holders and beneficial owners pursuant to the terms and conditions of the ADS Deposit Agreement and, if applicable, the ADRs issued to evidence the ADSs issued thereunder. As at the Latest Practicable Date, each ADS represents the right to receive 10 Company Shares on deposit with the ADS Custodian Bank; | |
“ADS Custodian Bank” | Citibank Nominees Singapore Pte Ltd.; | |
“ADS Deposit Agreement” | the Deposit Agreement by and among the Company, the ADS Depositary, the ADS Holders and beneficial owners of ADSs evidenced by ADRs issued thereunder, dated 4 November 1999, as amended on 26 September 2007; | |
“ADS Depositary” | Citibank, N.A.; | |
“ADS Holder” | the person or entity in whose name an ADS is registered on the books of the ADS Depositary maintained for such purpose. An ADS Holder may or may not be a beneficial owner of the ADSs. If an ADS Holder is not the beneficial owner of the ADSs registered in its name, such ADS Holder shall be deemed to have all requisite authority to act on behalf of the beneficial owners of the ADSs; | |
“Announcement” | the joint announcement by the respective boards of directors of the Company and the Acquiror dated 7 September 2009 in relation to the Acquisition by way of the Scheme; | |
“Announcement Date” | 7 September 2009, being the date of the Announcement; | |
“Books Closure Date” | a date and time (before the Effective Date) to be announced by the Company on which the Transfer Books and the Register of Members of the Company will be closed in order to determine the entitlements of Shareholders under this Scheme; | |
“Business Day” | unless otherwise expressly specified, (i) a day (excluding Fridays, Saturdays and gazetted public holidays in Abu Dhabi) on which commercial banks are open for business in Abu Dhabi in relation to acts or matters to be done or delivered pursuant to the Implementation Agreement in such location or to acts or matters to be done or delivered by the Acquiror, (ii) a day (excluding Saturdays, Sundays and gazetted public holidays in Singapore) on which commercial banks are open for business in Singapore in relation to acts or matters to be done or delivered pursuant to the Implementation Agreement in such location or to acts or matters to be done or delivered by the Company and (iii) a day (excluding Fridays, Saturdays, Sundays and gazetted public holidays) on which commercial banks are open for business in Abu Dhabi and Singapore in relation to acts or matters to be done or delivered pursuant to the Implementation Agreement in both locations (such acts or matters to |
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include the transfer of funds by the Acquiror for settlement of the Scheme Consideration); | ||
“CDP” | The Central Depository (Pte) Limited; | |
“Code” | The Singapore Code on Take-overs and Mergers; | |
“Companies Act” | the Companies Act, Chapter 50 of Singapore; | |
“Company” | Chartered Semiconductor Manufacturing Ltd.; | |
“Company Shares” | issued andpaid-up ordinary shares in the capital of the Company from time to time; | |
“Court” | the High Court of Singapore; | |
“Court Order” | the order of the Court approving the Scheme under Section 210 of the Companies Act; | |
“CRPS” | convertible redeemable preference shares in the capital of the Company, having the rights and subject to the restrictions set out in Article 4A of the Articles of Association of the Company; | |
“Effective Date” | the date on which this Scheme, if approved, becomes effective in accordance with its terms; | |
“Encumbrances” | all charges, mortgages, liens, hypothecations, judgments, encumbrances, easements, rights of pre-emption, securities, title retentions, preferential rights, preferential arrangements, trust arrangements or all other security interests or all other agreements or arrangements having a commercial effect analogous to the conferring of security or a similar right in favour of any person; | |
“Entitled Shareholders” | Shareholders as at 5:00 p.m. on the Books Closure Date; | |
“ESOP” | the Company’s Share Option Plan 1999 approved and adopted on 30 March 1999, as amended and restated on 30 May 2001 and as the same may be further modified or altered from time to time; | |
“GS” | Goldman Sachs International; | |
“GS Option” | the equity option transaction entered into between the Company and GS, as evidenced by the confirmation dated 27 March 2007 (reference number LTAA1419140936.0.0.0/00643091201), as amended and supplemented from time to time between the Company and GS; | |
“Implementation Agreement” | the implementation agreement dated 7 September 2009 between the Company and the Acquiror to effect the Acquisition by way of this Scheme, as may be amended from time to time; | |
“Latest Practicable Date” | 1 October 2009, being the latest practicable date prior to the printing of the Scheme Document; | |
“Long-Stop Date” | 8 March 2010, as may be extended; | |
“Nasdaq” | Nasdaq Global Select Market; |
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“Options” | Options granted by the Company pursuant to the ESOP; | |
“PSU Plan” | the Company’s Performance Share Unit Plan 2007, approved and adopted on 24 April 2007, as the same may be modified or altered from time to time; | |
“PSUs” | units granted under the PSU Plan; | |
“RSU Plan” | the Company’s Restricted Share Unit Plan 2007, approved and adopted on 24 April 2007, as the same may be modified or altered from time to time; | |
“RSUs” | units granted under the RSU Plan; | |
“Scheme” | this scheme of arrangement in its present form or with or subject to any modification thereof or addition thereto in accordance withParagraph 7 herein or condition(s) approved or imposed by the Court; | |
“Scheme Consideration” | the cash amount of S$2.68 for each Company Share to be paid by the Acquiror to each Entitled Shareholder in accordance with the terms of this Scheme; | |
“Scheme Document” | the document dated 9 October 2009 containing this Scheme and any other document(s) which may be issued by or on behalf of the Company to amend, revise, supplement or update the document(s) from time to time; | |
“Scheme Shares” | has the meaning given to it inParagraph (D) of this Scheme; | |
“Securities Account” | the securities account maintained by a Depositor with CDP but excluding any securities sub-account; | |
“SGX-ST” | Singapore Exchange Securities Trading Limited; | |
“Shareholders” | persons who are registered as holders of Company Shares in the Register of Members of the Company and, where such person is CDP, Depositors who have Company Shares entered against their names in the Depository Register; | |
“Singapore” | the Republic of Singapore; and | |
“S$” | Singapore dollars; |
(ii) | the terms “Depositor” and “Depository Register” shall have the meanings given to them respectively in Section 130A of the Companies Act; |
(iii) | the term “Shareholder” includes a person entitled by transmission; |
(iv) | words importing the singular shall, where applicable, include the plural, andvice versa. Words importing the masculine gender shall, where applicable, include the feminine and neuter genders, andvice versa. References to persons shall, where applicable, include corporations; | |
(v) | any reference to any enactment is a reference to that enactment as for the time being amended or re-enacted. Any word defined in the Companies Act or the Code or any statutory modification thereof shall, where applicable, have the meaning assigned to it under the Companies Act or the Code, or any modification thereof, as the case may be, unless the context otherwise requires; and |
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(vi) | any reference to a time of day and date shall be a reference to Singapore time and date, unless otherwise specified. |
(B) | The Company was incorporated in Singapore on 16 November 1987. The Company Shares were listed on the Main Board of the SGX-ST on 1 November 1999 and the ADSs were listed on Nasdaq on 29 October 1999. |
(C) | As at the Latest Practicable Date, the Company had (i) in issue 942,060,579 Company Shares and 28,350 CRPS, convertible into 68,810,679 Company Shares at the prevailing US$4.12 conversion price, (ii) 14,479,461 Company Shares comprised in outstanding Options, (iii) 3,791,383 Company Shares comprised in outstanding RSUs, (iv) 979,754 Company Shares comprised in outstanding PSUs and (v) 32,388,322 Company Shares comprised in the GS Option. |
(D) | This Scheme will be extended, on the same terms and conditions to: |
(i) | all Company Shares, including Company Shares represented by ADSs; and | |
(ii) | all new Company Shares unconditionally issued or to be issued on or before the Books Closure Date pursuant to (a) the valid exercise of any Options, (b) the vesting of any awards under the RSU Plan, (c) the vesting of any awards under the PSU Plan, (d) the valid conversion of CRPS into new Company Shares and (e) the valid exercise by GS of the GS Option. |
(E) | The primary purpose of this Scheme is the acquisition by the Acquiror of all the Scheme Shares. |
(F) | The Company and the Acquiror have entered into the Implementation Agreement to set out their respective rights and obligations with respect to the Scheme and implementation thereof. |
(G) | The Acquiror has agreed to appear by Counsel at the hearing of the Originating Summons to approve this Scheme and to consent thereto, and to undertake to the Court to be bound thereby and to execute and do and procure to be executed and done all such documents, acts and things as may be necessary or desirable to be executed and done by it for the purpose of giving effect to this Scheme. |
1. | (i) With effect from the Effective Date, all the Scheme Shares will be transferred to the Acquiror: |
(a) | fully paid; | |
(b) | free from all Encumbrances; and | |
(c) | together with all rights, benefits and entitlements as at the Announcement Date and thereafter attaching thereto, including the right to receive and retain all dividends, rights and other distributions (if any) which may be announced, declared, paid or made by the Company on or after the Announcement Date. |
(ii) | For the purpose of giving effect to the transfer of the Scheme Shares provided for inParagraph 1(i) of this Scheme: |
(a) | in the case of Entitled Shareholders (not being Depositors), the Company shall authorise a person to execute or effect on behalf of all such Entitled Shareholders, not later than three Business Days after the Effective Date, an instrument or instruction of transfer of all the Scheme Shares held by such Entitled Shareholders and every such instrument or instruction of transfer so executed shall be effective as if it had been executed by the relevant Entitled Shareholder; and |
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(b) | in the case of Entitled Shareholders (being Depositors), CDP shall not later than three Business Days after the Effective Date, debit all the Scheme Shares standing to the credit of the Securities Account of such Entitled Shareholders and credit all of such Scheme Shares to the Securities Accounts of the Acquiror or such Securities Accounts as directed by the Acquiror. |
2. | In consideration for the transfer of the Scheme Shares as set out inParagraph 1(i) of this Scheme, the Acquiror shall, not later than 10 days after the Effective Date, make payment of the Scheme Consideration payable on the transfer of the Scheme Shares to: |
(i) | each Entitled Shareholder (not being a Depositor) by sending a cheque for the aggregate Scheme Consideration payable to and made out in favour of such Entitled Shareholder by ordinary post to its/his address in the Register of Members of the Company at the close of business on the Books Closure Date, at the sole risk of such Entitled Shareholder, or in the case of joint Entitled Shareholders, to the first-named Entitled Shareholder made out in favour of such Entitled Shareholder by ordinary post to its/his address in the Register of Members of the Company at the close of business on the Book Closure Date, at the sole risk of such joint Entitled Shareholders; and | |
(ii) | each Entitled Shareholder (being a Depositor) by making payment of the aggregate Scheme Consideration payable to such Entitled Shareholder to CDP. CDP shall: |
(a) | in the case of an Entitled Shareholder (being a Depositor) who has registered for CDP’s direct crediting service, credit the aggregate Scheme Consideration payable to such Entitled Shareholder to the designated bank account of such Entitled Shareholder; and | |
(b) | in the case of an Entitled Shareholder (being a Depositor) who has not registered for CDP’s direct crediting service, send to such Entitled Shareholder, by ordinary post to its/his address in the Depository Register at the close of business on the Books Closure Date and at the sole risk of such Entitled Shareholder, a cheque for such aggregate Scheme Consideration payable to and made out in favour of such Entitled Shareholder. |
3. (i) | The crediting by CDP of the aggregate Scheme Consideration payable to an Entitled Shareholder (being a Depositor and in the case of an Entitled Shareholder who has registered for CDP’s direct crediting service) into the designated bank account of such Entitled Shareholder or, as the case may be, the posting of any cheque referred to inParagraph 2 of this Scheme shall be a good discharge to the Acquiror, the Company and CDP for the moneys represented thereby. |
(ii) | On or after the day falling six months after the posting of the cheques by the Acquiror pursuant toParagraph 2 of this Scheme, the Acquiror shall have the right to cancel or countermand payment of any such cheque which has not then been cashed (or has been returned uncashed) and shall place all moneys represented thereby in a bank account in the Company’s name with a licensed bank in Singapore selected by the Company. The Company or its successor entity shall hold such moneys until the expiration of six years from the Effective Date and shall prior to such date make payments therefrom of the sums payable pursuant toParagraph 2 of this Scheme to persons who satisfy the Company or its successor entity that they are respectively entitled thereto and that the cheques referred to inParagraph 2 of this Scheme of which they are payees have not been cashed. Any payments made by the Company hereunder shall not include any interest accrued on the sums to |
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which the respective persons are entitled pursuant toParagraph 2 of this Scheme. The Company shall exercise its absolute discretion in determining whether or not it is satisfied that any person is so entitled or not so entitled, as the case may be, and any such determination shall be conclusive and binding upon all persons claiming an interest in the relevant moneys. |
(iii) | On the expiration of six years from the Effective Date, the Acquiror shall be released from any further obligation to make payments under this Scheme and the Company or its successor entity shall transfer to the Acquiror the balance (if any) of the sums then standing to the credit of the bank account referred to inParagraph 3(ii) of this Scheme including accrued interest subject, if applicable, to the deduction of interest, tax or any withholding tax or any other deduction required by law and subject to the deduction of any expenses. | |
(iv) | Paragraph 3(iii) of this Scheme shall take effect subject to any prohibition or condition imposed by law. |
4. | As at and from the Effective Date, all existing share certificates relating to the Scheme Shares held by Entitled Shareholders will cease to have effect as evidence of title of the Scheme Shares represented therein, and Entitled Shareholders (not being Depositors) are required to forward their existing share certificates relating to their Scheme Shares to M&C Services Private Limited’s registered office at 138 Robinson Road #17-00 The Corporate Office Singapore 068906 as soon as possible, but not later than 10 days after the Effective Date, for cancellation. |
5. | This Scheme shall become effective and binding upon a copy of the Court Order being duly lodged with ACRA. |
6. | Unless this Scheme shall have become effective and binding as aforesaid on or before the Long-Stop Date, such other date as the Parties may agree, or as the Court may allow on the application of the Company or the Acquiror, this Scheme shall lapse. |
7. | The Company and the Acquiror may jointly consent for and on behalf of all concerned to any modification of, or amendment to, this Scheme or to any condition which the Court may think fit to approve or impose. |
8. | In the event that this Scheme does not become effective for any reason, the costs and expenses incurred by the Company in connection with this Scheme will be borne by the Company, save as otherwise agreed between the Company and the Acquiror in the Implementation Agreement. |
9. | This Scheme shall be governed by, and construed in accordance with, the laws of Singapore and the Company, the Acquiror and Shareholders submit to the non-exclusive jurisdiction of the courts of Singapore. |
10. | A person who is not a party to this Scheme has no rights under the Contracts (Rights of Third Parties) Act, Chapter 53B of Singapore to enforce any term or provision of this Scheme. |
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Semiconductor Manufacturing Ltd.
Companies Act, Chapter 50
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Term | Meaning | |
“Company Shares” | Issued and paid-up ordinary shares in the capital of the Company from time to time. | |
“Shareholders” | Persons who are registered as holders of Company Shares in the Register of Members of the Company and Depositors (as defined in Section 130A of the Companies Act) who have Company Shares entered against their names in the Depository Register. |
Semiconductor Manufacturing Ltd.
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