| Fri 20 Jul 2001, 0:00 | | An Odd-lot Offer, The Consolidation And Sub-divisi |
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issued share capital of Zarara
ZARARA ENERGY LIMITED
(formerly Mawenzi Resources Limited)
(Incorporated in the Republic of South Africa)
(Registration number 1895/001078/06)
("Zarara" or "the company")
An odd-lot offer, the consolidation and sub-division of the authorised and
issued share capital of Zarara
1. Introduction
It was announced in the press on 13 July 2001 that the board of directors of
Zarara ("the directors") would be proposing an odd-lot offer. Currently
4033 shareholders out of 4995 shareholders hold less than 1 000 ordinary
shares.
In order to reduce the administrative costs associated with this large
number of odd-lot holdings in an equitable manner, the directors are
proposing the implementation of an odd-lot offer by way of a consolidation
and subsequent sub-division of the authorised and issued share capital of
the company.
2. Notice of last day to trade and record date
All shareholders holding less than 1 000 ordinary shares at the close of
business on the record date, being Friday 27 July 2001, and who are still so
registered at the close of business on Friday 31 August 2001 ("the "odd-lot
shareholders"), are entitled to participate in the odd-lot offer and to make
the elections set out below.
The last day to trade to be eligible to participate in the odd-lot offer is
on Friday 20 July 2001. Any ordinary shares purchased on the JSE Securities
Exchange South Africa ("the JSE") between Friday 20 July 2001 and Friday 27
July 2001 or thereafter will not be eligible to participate in the odd-lot
offer.
3. Mechanism of the odd-lot offer
In terms of the odd-lot offer, odd-lot shareholders may, up to 14:00 on
Wednesday 29 August 2001, elect either to:
- sell their odd-lot holdings at 17 cents per ordinary share (the "offer
price"), determined by taking into account the average weighted closing
price of ordinary shares on the JSE over the 20 trading days ended 19 July
2001, ("the cash alternative"); or
- purchase a sufficient number of additional ordinary shares at the offer
price in order to increase their respective holdings to 1 000 ordinary
shares ("the share purchase alternative"); or
- retain their odd-lot holdings.
4. Consolidation and sub-division
4.1 It is proposed to consolidate the share capital of Zarara on the basis
that every 1 000 ordinary shares will be consolidated into one ordinary
share having a par value of 500 cents each (the "consolidated shares") with
effect from the close of business on Friday 31 August 2001 (the
"consolidation").
Those odd-lot shareholders who do not elect to accept the cash alternative,
the share purchase alternative or to retain their odd-lot holdings will, on
consolidation, become holders of fractions of consolidated shares ("fraction
holders"). Unless the fraction holders have elected to retain those odd-lot
holdings which will become fractions on consolidation ("fractions") in terms
of the odd-lot offer, they will be deemed to have accepted the cash
alternative and will receive a consideration equal to the offer price
multiplied by the number of ordinary shares which become the fraction.
Shareholders who have dematerialised their ordinary shares with a Central
Securities Depositary Participant ("CSDP") or broker must advise their CSDP
or broker as to what action they wish to take in this regard. This must be
done in terms of the agreement entered into between them and the CSDP or
broker. It is important to note that shareholders who have dematerialised
their ordinary shares must NOT return an election form to the transfer
secretaries as this will be rejected by them. Their instruction must be sent
to their CSDP for action.
4.4 Immediately following the consolidation, the consolidated shares will
then be sub-divided on the basis that each consolidated share will be sub-
divided into 100 ordinary shares of a par value of 5 cents each (the "sub-
division"). The aggregate of the ordinary shares which become available as a
result of the odd-lot shareholders electing to accept the cash alternative,
or being deemed to have elected it because no election to retain odd-lot
holdings was made by those odd-lot shareholders, will be used to satisfy the
demand for the ordinary shares by those odd-lot shareholders who elect to
acquire additional ordinary shares under the share purchase alternative.
Odd-lot holders who do not provide their CSDP or broker with their election
instructions by the time and date provided to them by their CSDP or broker
as the deadline for receipt of such instructions, should note that their odd-
lot holdings will become fractions on consolidation ("fractions") in terms
of the odd-lot offer, they will be deemed to have accepted the cash
alternative and will receive a consideration equal to the offer price
multiplied by the number of ordinary shares which become the fraction.
4.6 To the extent that the aggregate of the ordinary shares to be sold in
terms of the cash alternative or deemed cash alternative, exceed the total
number of the ordinary shares required by those odd-lot shareholders
electing the share purchase alternative, such shares will be purchased by
the Zarara Employees Share Trust.
To the extent that there are insufficient ordinary shares to satisfy the
demand under the share purchase alternative, the company will issue
additional ordinary shares, in terms of an issue of shares for cash.
5. Financial effects
5.1 Financial effects of the consolidation and sub-division
The consolidation and sub-division will have no effect upon the share
capital of the company. Consequently, the net asset value and earnings per
share of the company will not change.
5.2 Financial effects of the issue of additional ordinary shares
The issue of additional ordinary shares, if any, to those odd-lot
shareholders who elect to round up their odd-lot holdings to 1 000 ordinary
shares in terms of the share purchase alternative is not expected to have
any material effect on the earnings per share or on the net asset value per
share of the company.
6. General
A circular containing further information relating to the odd-lot offer,
along with the necessary documentation and a notice convening a general
meeting of shareholders to be held at the registered office of the company,
1st Floor, 18 Rivonia Road, Illovo, 2196 at 08:30 on Wednesday 22 August
2001, will be posted to shareholders on or about Monday 30 July 2001.
Illovo
23 July 2001
Corporate law advisers and consultants
Edward Nathan & Friedland (Pty) Ltd
(Registration number 1999/026464/07)
Sponsor
Brait Advisory Services Limited
(Registration number 1995/005372/06)
