NSE-Web-Prospectus-2014

13.14 Material IndebtednessThe Company borrowed a sum of Kshs 300 Million from the KenyaCommercial Bank Limited in October 2012 to partly finance thepurchase of Land Reference No. 209/18851. The loan is securedby a debenture and a charge issued by the NSE to the bank. Theterms of the borrowing as set out in a facility Letter dated 9October 2012 between NSE and Kenya Commercial Bank Limitedand the supplementary Letter thereto dated 16 October 2012.The interest rate is minus 2 the bank’s base rate. The tenure is 120months inclusive of a 3 month moratorium period, the repaymentis monthly and the prepayment is permitted without penalties.13.15 Related Party AgreementsThe Company does not currently have any material contracts withrelated third parties.13.16 Onerous Covenants and DefaultThe Company has no material contracts with third partiesthat have onerous covenants which are not disclosed in thisProspectus. As at the date of this Prospectus, the Company is notin breach of any of the terms of its contracts or its loan covenants.13.17 Material Litigation and Claims(a) Industrial Court Cause No 344 of 2010 - an unlawfultermination claim for Kshs 5.28 million by a formeremployee.(b) Industrial Court Cause No 251 of 2010 - an unlawfultermination claim by a former employee which is nowdormant.Although there can be no assurances, the Directors believe, basedon the information currently available and legal advice, thatthe two claims can be successfully defended and therefore noprovision has been made in the financial statements. Save for theabove matters, the Company is not a party to any other materiallitigation.13.18 Director Service ContractNSE has executed a service contract with its Chief ExecutiveOfficer dated 19 December 2011 for a term of 3 years with effectfrom 24 November 2011. The contract provides that either partymay terminate it by giving 3 months’ notice to the other party ormaking payment in lieu of notice.13.19 Aggregate Directors’ Remuneration in the last financialyearThe following represents the directors’ remuneration for theyear ended 31st December 2013: Non-Executive Directors (Kshs7,297,000) and Executive Directors (Kshs 13,514,000).There are no arrangements under which any of the Directorshave waived or agreed to waive future emoluments and there hasbeen no agreement for the waiver of such emoluments in the lastfinancial year.13.20 Directors DeclarationTo the best of the knowledge and belief of the Directors (whohave taken all reasonable care to ensure that such is the case)the information contained in this document is in accordance withthe facts and does not omit anything likely to affect the import ofsuch information.13.21 Interests of DirectorsAs at the date of this Prospectus, the following TradingParticipants shareholders held shares in the Company:(i) Faida Investment Bank Ltd and Kingdom Securities Ltd. Mr.Bob Karina is a shareholder and director of Faida InvestmentBank Ltd and a director of the Company.(ii) Mr. Geoffrey Odundo is a director of Kingdom SecuritiesLtd and a director of the Company.None of the Directors of the NSE directly or indirectly holds morethan 5% of the NSE Shares in NSE.13.22 Prospectus delivered to the Registrar of CompaniesA copy of this Prospectus has been delivered to the Registrar ofCompanies for registration with the written consents, approvals,material contracts, Reporting Accountants’ Report and LegalOpinion referred to in this Prospectus.13.23 Control of Company’s SharesThe Company has no contractual arrangement with a controllingshareholder required to ensure that the company is capable at alltimes of carrying on its business independently of any controllingshareholder.13.24 Changes to Company and its Business(a) There have been no changes in the trading objectives of theCompany or its subsidiaries over the last two years, nor isany new trading objective foreseen in the near future.(b) There have been no interruptions in the business of theCompany or its subsidiaries affecting the financial positionof the Company or its subsidiaries in the last five years.(c) Other than the share consolidation that took place (refer toSection 13.1.3 above) there has been no material change inthe business, financial and trading position of theCompany in the past five years.(d) Save as disclosed in this information memorandum, therehas been no significant research and development of newproducts or processes over the last three financial years.13.25 General Information(1) There are no founders’, management or deferred sharesin the capital of the Company;(2) The share capital of the Company is not divided intodifferent classes of shares and all shares carry equal rights;(3) No unissued share or loan capital of the Company isunder option or agreed conditionally or unconditionallyto be put under option;(4) No share or loan capital of the Company or its subsidiaryis now proposed to be issued, fully or partly paid, for aconsideration other than cash;(5) No commissions, discount, brokerage or other special termshave been granted by the Company on an issue or sale ofany share or loan capital, within the period sinceincorporation and the Offer;(6) The members of the Company do not carry on widelydiffering operations resulting in substantially differentcontributions being made by each member of the Company;(7) As at the date of this Prospectus there are 83,875,000unissued shares in the Company but there are nocategories of persons having preferential subscriptionrights to such unissued shares;(8) The Company does not intend to carry on any otherbusinesses that may be material with regard to the profitor loss, assets employed or any other factors affectingthe current business;(9) Save as disclosed in Section 13, no significant materialassets have been purchased by the Company in the lastfive years.(10) So far as the Directors of the Company are aware, thereis no material litigation nor are there claims of material58