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Howden Africa Holdings Limited - Licence Agreement Between Howden And Its
Holding Company
Howden Africa Holdings Limited
(Incorporated in the Republic of South Africa)
(Registration number 1996/002982/06)
Share code: HWN & ISIN: ZAE000010583
("HAHL" or "the Company")
LICENCE AGREEMENT BETWEEN HAHL AND ITS HOLDING COMPANY HOWDEN HOLDINGS LIMITED
("HHL")
1. Introduction
1.1 Shareholders are advised that HAHL has entered into a new licence agreement
("the licence agreement") with its UK based holding company, Howden Holdings
Limited ("HHL"), which secures the company"s rights to leading global
technology, for the foreseeable future. This new agreement replaces the original
agreement, which was initially signed in 1973.
1.2 In consideration of HAHL"s payment of the royalties under the licence
agreement, HHL has granted HAHL the right to manufacture, sell, promote and
use specific products on the African Continent, including without
limitation Madagascar, Reunion and Mauritius but excluding Algeria, Egypt
and Morocco. This agreement does not cover products where design rights are
owned by HAHL.
2. Terms and conditions pertaining to the licence agreement
The licence agreement takes effect from 1 January 2005, and shall continue for
an initial period of five years from that date, subject to no material breach or
default by either party. Thereafter the agreement will continue for successive
periods of one year.
Based on management"s estimates and the current level of activity within the
company, these payments are expected to amount to approximately R1m (one million
Rand) for the year ending 31 December 2005, an amount similar to the amount that
would have been paid under the previous agreement. The terms of the new
agreement provide for a maximum payment of R3m (three million Rand) in any
calendar year for the first five years.
3. Categorisation of the Licence agreement
The licence agreement is classified as a small related party transaction in
terms of the Listings Requirements of JSE Limited ("JSE"). Since these
arrangements are essentially in the form of a renewal of existing
arrangements and since the new agreement has recently been approved by the
Exchange Control Authorities, and as part of this process received the
approval of the Department of Trade and Industry, the JSE has agreed to the
company"s request that no fair and reasonable opinion be provided, and has
provided the requisite dispensation to the company.
15 December 2005
Advisor and Sponsor to HAHL
PricewaterhouseCoopers Corporate Finance (Pty) Ltd
(Registration number 1970/003711/07)
Attorneys
Cliffe Dekker Attorneys
Date: 15/12/2005 05:05:14 PM Produced by the JSE SENS Department
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