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Motivation for ordinary resolution 7
>annual general meeting
ABIL recently granted its ordinary shareholders an election to receive capitalisation shares in lieu of the cash dividend
declared on 19 November 2012. Each of the BEE companies is precluded in terms of its memorandum of incorporation
from electing the capitalisation shares and therefore is forced to accept the cash dividend and then use the cash dividend
to buy more ABIL ordinary shares on the JSE. ABIL granted the option to elect capitalisation shares to its ordinary
shareholders with a view to preserving capital to fund the continued growth of African Bank Limited.
ABIL would like to have the ability to offer each of the BEE companies the opportunity to use all or part of the cash
dividend that such company is obliged to elect to receive and then use to buy ABIL ordinary shares on the JSE, to rather
subscribe for ordinary shares in ABIL. This would then have the same effect as would have been the case had the BEE
companies elected to receive capitalisation shares. The further benefit for ABIL is that its BEE companies continue to
increase their BEE shareholding in ABIL without having to incur transaction costs that would be incurred for purchases on
the JSE, thus enabling the BEE companies to increase their holding in ABIL with this saving.
ABIL will only use this part of the authority (being in respect of a maximum of 8 million ordinary ABIL shares) in
circumstances where ABIL has granted ordinary shareholders an election to receive a cash dividend or capitalisation
shares and the BEE company concerned is precluded in terms of its memorandum of incorporation from electing to
receive such capitalisation shares.
The BEE companies have also raised third party preference share funding which they must use to acquire ABIL shares.
Given ABIL’s desire to obtain capital to fund the continued growth of African Bank Limited, ABIL would like permission to
issue up to a maximum of 4 million further ordinary ABIL shares to the BEE companies, should the BEE companies agree
to subscribe for such shares.
The minimum price per share which the BEE companies could pay for new ABIL ordinary shares issued to it would be the
weighted average traded price of the ordinary ABIL shares used by ABIL to determine the number of capitalisation shares
which ordinary shareholders would be entitled to receive should they elect capitalisation shares, but may be higher if
90% of the relevant 30 business day VWAP is higher.
The maximum aggregate number of ordinary shares of a par value of 2,5 cents each which ABIL may issue pursuant to
this authority is 12 million ordinary shares, being marginally less than 1,5% of the number of issued ordinary shares of
the company as at 7 December 2012.
13. Ordinary resolution 8 – directors’ authority to implement special and ordinary resolutions
RESOLVED THAT, as an ordinary resolution, each and every director of the company be and is hereby authorised to do
all such things and sign all such documents as may be necessary for or incidental to the implementation of the resolutions
passed at this meeting.
Percentage of voting rights required to pass this resolution: 50% plus one vote of the voting rights exercised.
Motivation for ordinary resolution 8
This resolution is to provide the directors with the necessary authority to do all things necessary to act under or implement
the decisions and resolutions passed at this meeting.
14. General information
14.1 Voting and proxies
All shareholders of the company are entitled to attend and speak at the AGM or any adjournment thereof.
All holders of ordinary shares will be entitled to vote on each resolution at the AGM or any adjournment
thereof. Holders of preference shares shall be entitled to attend and speak at the AGM or any adjournment
thereof but shall only be entitled to vote in respect of special resolution 2.
African Bank Investments Limited | Integrated Report for the year ended 30 September 2012 339