APPENDIX I PRINCIPAL TERMS AND CONDITIONS OF THE PROPOSAL

Transcription

1 APPENDIX I PRINCIPAL TERMS AND CONDITIONS OF THE PROPOSAL 1

2 PRINCIPAL TERMS AND CONDITIONS OF THE PROPOSALS BACKGROUND INFORMATION 1 Issuer (i) Name : British American Tobacco (Malaysia) Berhad ( Issuer or BATM ) (ii) Address : Virginia Park, Jalan Universiti Petaling Jaya Selangor Darul Ehsan (iii) Business registration no. : 4372-M (iv) (v) Date/place of incorporation Date of listing (in the case of a public listed company) : 11 September 1961 / Malaysia : 27 October 1961 (vi) Status resident/non-resident controlled company Bumiputera/non- Bumiputera controlled company (vii) Principal activities (viii) Board of directors : Non-resident controlled company : Non-Bumiputera : BATM is principally an investment holding company which provides day to day administrative and management services to its subsidiaries which are principally engaged in the manufacturing, importation and distribution of cigarettes, pipe tobaccos and cigars. : The Board of Directors of BATM as at 30 June 2007 are as follows:- 2

3 1. Tan Sri Abu Talib bin Othman 2. Jack Marie Henry David Bowles 3. Tan Sri Kamarul Ariffin bin Mohamed Yassin 4. Datuk Oh Chong Peng 5. James Richard Suttie 6. Robert James Clark 7. Dato Chan Choon Ngai (ix) Structure of shareholdings and names of shareholders or, in the case of a public company, names of all substantial shareholders : As at 30 June 2007 the list of top thirty (30) shareholders of BATM is as follows: - Name No. of Shares Held Shareholding (%) British American 142,765, Tobacco Holdings (M) B.V. Employees Provident 15,052, Fund Board Amanah Raya 11,143, Nominees (Tempatan) Sdn Bhd Skim Amanah Saham Bumiputera Permodalan Nasional 7,268, Berhad Valuecap Sdn Bhd 6,059, ,175, TNTC for Saudi Arabian Monetary Agency 4,894, Exempt AN for BNP Paribas Securities Services (convert in USD) Amanah Raya 4,493, Nominees (Tempatan) Sdn Bhd Amanah Saham Malaysia Malaysia Nominees 4,375, (Tempatan) Sdn Bhd Great Eastern Life Assurance (Malaysia) Berhad (PAR 1) Exempt AN for JPMorgan Chase Bank, 4,039,

4 National Association (JPM Funds) Exempt AN for JPMorgan Chase Bank, National Association (U.A.E.) Citigroup Nominees Exempt AN for Mellon Bank (Mellon) Cartaban Nominees Exempt AN for RBC Dexia Investor Services Trust (Client s Account) Citigroup Nominees CB LUX for Vontobel Fund (Far East Equity) Exempt AN for the HongKong and Shanghai Banking Corporation Limited (HBFS -1 CLT ACCT) Cartaban Nominees Investors Bank and Trust Company for Ishares, Inc. BNP Paribas Securities Services Paris for Aberdeen Asia Pacific Fund Cartaban Nominees State Street London Fund VE9L for the Local Government Pensions Institution (Tempatan) Sdn Bhd Nomura Asset Mgmt Malaysia for Employees Provident Fund Citigroup Nominees CB LUX for Vontobel Fund 2,751, ,413, ,144, ,945, ,791, ,722, ,557, ,550, ,374, ,258,

5 (Emerg Mkts Eqty) TNTC for Sanderson International Value Fund BNY Brussels for CG Nouvelle Asie Exempt AN for JPMorgan Chase Bank, National Association (UK) Citigroup Nominees Exempt AN for American International Assurance Company Limited BBH and CO Boston for Merrill Lynch Global Allocation Fund Exempt AN for JPMorgan Chase Bank, National Association (USA) Cartaban Nominees Nomura Trust and Banking Company Limited Tokyo for Asia Attractive Dividend Stock Fund Mother Fund Citigroup Nominees (Tempatan) Sdn Bhd Exempt AN for Prudential Assurance Malaysia Berhad BBH and CO Boston for Vanguard Emerging Markets Stock Indexfund Exempt AN for JPMorgan Chase Bank, National Association 1,226, ,200, ,188, ,152, ,125, ,120, ,108, ,069, ,027, ,

6 (Netherlands) (x) Authorised and paid-up capital : Authorised Share Capital as at 30 June 2007 RM385,000, divided into 770,000,000 ordinary shares of RM0.50 each. : Issued and Fully Paid-up Share Capital as at 30 June 2007 RM142,765,000 divided into 285,530,000 ordinary shares of RM0.50 each. PRINCIPAL TERMS AND CONDITIONS OF THE PROPOSALS 2 Names of parties involved in the proposed transaction (where applicable) (i) Principal Adviser/ : HSBC Bank Malaysia Berhad ( HSBC ) or ( LA ) Lead Arranger (ii) Arranger(s) : Co-Arrangers Citibank Berhad and CIMB Investment Bank Berhad (formerly known as Commerce International Merchant Bankers Berhad). (iii) Valuers : Not applicable. (iv) Solicitors : Messrs Zaid Ibrahim & Co. as solicitors acting for HSBC. (v) Financial Adviser : Not applicable. (vi) Technical Adviser : Not applicable. (vii) Guarantor : Not applicable. (viii) Trustee : HSBC (Malaysia) Trustee Berhad (ix) Facility Agent : HSBC (x) (xi) Primary Subscriber(s) and amount subscribed (where applicable) Underwriter(s) and amount underwritten : The Primary Subscribers (if any) will be determined prior to each issuance. : Not applicable. 6

7 (xii) Central Depository : Bank Negara Malaysia ( BNM ). (xiii) Paying Agent : BNM. (xiv) (xv) Reporting Accountant Others (please specify) : None. : Lead Manager HSBC. However, in relation to each issue of the commercial papers/medium term notes, the Issuer may appoint any other financial institution to manage such issuance. 3 Facility Description : The Issuer plans to issue commercial papers ( CPs ) / medium term notes ( MTNs ) pursuant to a commercial papers/medium term notes programme ( CP/MTN Programme ) of up to RM100 million. Collectively, the CPs and MTNs shall be referred to as Notes. 4 Issue Size (RM) : The aggregate nominal value of outstanding Notes issued under the CP/MTN Programme shall not exceed RM100.0 million at any point in time. 5 Issue Price (RM) : CPs The CPs shall be issued at a discount to face value and the price payable for each CP shall be calculated in accordance with the formula as set out in the Rules on Fully Automated System for Issuing/Tendering issued by BNM, as amended or substituted from time to time ( FAST Rules ). MTNs The MTNs are to be issued at par or at a discount to face value and the price payable for each MTNs shall be calculated in accordance with the FAST Rules. 6 Tenor of the Facility/Issue : Programme Tenor Seven (7) years from the date of the first issue of the CPs or MTNs under the CP/MTN Programme. To the extent required by the Securities Commission ( SC ) s Guidelines on the Offerings of Private Debt Securities, the first issue of the CPs or MTNs shall be made within two (2) years from the date of the SC s approval. Issue Tenor CPs Each issue of CPs may be any period above one (1) 7

8 month and up to twelve (12) months as the Issuer may select, provided that no CPs mature after the expiry of the Programme Tenor. MTNs Each issue of MTNs may be any period above one (1) year and up to seven (7) years as the Issuer may select, provided that no MTNs mature after the expiry of the Programme Tenor. 7 Interest / Coupon Rate (%) : CPs The CPs will bear no coupon and be issued at a discount to its face value. MTN The MTNs may be issued on a zero coupon basis or with coupons. For MTNs issued with coupons, the coupon rate will be determined and agreed prior to each issuance of MTNs. 8 Interest / Coupon Payment Frequency and Basis : CPs Not applicable to CPs as the CPs will be issued at a discount to face value. MTNs For MTNs issued on a zero coupon basis, this is not applicable. For MTNs issued with coupons, such coupons shall be payable semi-annually in arrears. The coupon payments shall be calculated based on an actual/365 basis. 9 Yield to Maturity (%) : The yield to maturity will be determined at the point of issuance. 10 Security/Collateral (if any) : None. 11 Details on Utilisation of Proceeds : Proceeds from the CP/MTN Programme shall be utilised by the Issuer to refinance the Issuer s existing borrowings and to finance the Issuer s working capital requirements and capital expenditure (where required). 12 Sinking Fund (if any) : None. 13 Rating Credit rating assigned [Please specify if this is an indicative rating] : The final rating for the CPs and MTNs shall be P1 and AAA, respectively. Name of rating agency : RAM Rating Services Berhad ( RAM ) 8

9 14 Form and Denomination : Each issue of the CPs and MTNs shall be represented by a global certificate in bearer form to be deposited with the Central Depository. 15 Mode of Issue : CPs The CPs and MTNs shall be issued under the Real Time Electronic Transfer of Funds and Securities ( RENTAS ) and shall be subject to (1) the Code of Conduct and Market Practices for the Malaysian Corporate Bond Market issued by the Institut Peniaga Bon Malaysia and approved by BNM ( IPBM Code ) (2) the Rules on the Scripless Securities under the Real Time Electronic Transfer of Funds and Securities ( Rentas ) system issued by BNM ( Rentas Rules ) and (3) the FAST Rules, or their replacement thereof (collectively the Codes of Conduct ) applicable from time to time. Subject to the Transaction Documents (as hereinafter defined), the CPs and the MTNs will be traded through RENTAS and no physical delivery of the CPs and MTNs will be permitted. The denomination of the CPs and MTNs shall be RM1,000,000 or in multiples of RM1,000,000 at the time of issuance. The CPs will be issued via tender or private placement. MTNs The MTNs will be issued by private placement. Tender Basis The Facility Agent will, subject to the Selling Restrictions and agreement by the Issuer, invite a selection of banks and other financial institutions to participate as Tender Panel Members to bid competitively for the CPs to be issued under the CP/MTN Programme. The composition of the Tender Panel Members may be varied from time to time by the Issuer or, as the case may be, by the Facility Agent as directed by the Issuer. Allocation of the CPs to the bidders shall be based on ascending order of yield or descending order of price, as the case may be. Private Placement Each issuance of CPs/MTNs may be issued on a private placement basis on a bought deal, direct placement or book building basis, all without 9

10 prospectus. 16 Selling Restrictions : The Notes may not be offered, sold, transferred or otherwise disposed directly or indirectly, nor may any document or other material in connection therewith be distributed in Malaysia, other than to categories of persons falling within (a) Schedule 2 or Section 38(1)(b); (b) Schedule 3 or Section 39(1)(b); and (c) Schedule 5 or section 66(3) of the Securities Commission Act 1993, as amended from time to time, subject to any law, order, regulation or official directive of BNM, SC and/or any other regulatory authority from time to time. 17 Listing Status : The Notes will not be listed on any exchange. 18 Minimum Level of Subscription (RM or %) 19 Other regulatory approvals required in relation to the issue, offer or invitation and whether or not obtained (please specify) : The minimum level of subscription for each issue of the Notes that are not issued on a direct placement or bought deal basis (which shall be fully subscribed) shall be 5% of the size of that particular issue. : None. 20 Conditions Precedent : The first (1 st ) issuance of the Notes is subject to compliance with conditions precedent including, but not limited to the following: (a) execution and the endorsement of stamp duty exemption of all necessary documentation; (b) confirmation and delivery of all required corporate, governmental and other approvals, including but not limited to the approval of the SC; (c) satisfactory due diligence and legal opinion from the Solicitors as to the legality, validity and enforceability of all legal documentation; (d) evidence that the rating of the CP/MTN Programme is not below the ratings stated in Ratings clause above; and (e) such other conditions precedent as may be advised by the Solicitors and agreed by the 10

11 Issuer. 21 Representations and Warranties : Representations and warranties for transactions of this nature shall include the following: (a) the Issuer is a company duly established and existing under Malaysian law; (b) the Issuer has the power to enter into, exercise its rights under and perform its obligations under the Transaction Documents (defined hereunder); (c) the Issuer s audited accounts are prepared in accordance with generally accepted accounting principles and standards. The accounts fairly represent the Issuer s financial position as at the date of the accounts; and (d) to the best of the Issuer s knowledge, no litigation or arbitration is current or threatened, which if adversely determined would have a material adverse effect. 22 Events of Default : Events of default shall include breach of material obligations by the Issuer which remains unremedied after thirty (30) business days following receipt of Trustee s written notice of default; non-payment of any amounts due under the CPs and/or MTNs; misrepresentations of representations and warranties; execution proceedings; cross default; any event of a material adverse effect occurs; insolvency; winding-up and such other events which the LA s legal counsel may advise and agreed with the Issuer. Upon the occurrence of an Event of Default, the Trustee may or shall (if directed to do so by a special resolution of the Noteholders) declare that the CPs and/or MTNs are immediately due and repayable. Thereafter, the Trustee may take proceedings against the Issuer as it may think fit to enforce immediate repayment of the CPs and/or MTNs. 23 Principal terms and conditions for warrants (where applicable) 24 Other principal terms and conditions for the issue : Not applicable. I. Other covenants There will be other positive and negative covenants as agreed between the Issuer and 11

12 the LA and as may be required by the SC Guidelines on the Minimum Contents Requirements for Trust Deed. II. Redemption The Notes, unless previously redeemed or cancelled, shall be redeemed at the face amount upon maturity. III. Purchase and Cancellation The Issuer may at any time purchase the Notes in the open market at any price or by private treaty. The Notes so purchased by the Issuer shall be cancelled. IV. Status of the CPs and MTNs The CPs and MTNs to be issued under the CP/MTN Programme shall constitute direct, unconditional, unsecured and unsubordinated obligations of the Issuer ranking at all times pari passu without any preference amongst themselves and with all other direct, unconditional, unsecured and unsubordinated liabilities of the Issuer, present or future, other than liabilities preferred by law and subject to exceptions provided for in the transaction documents. V. Taxation All payments by the Issuer shall be made without withholding or deductions for or on account of any present or future tax, duty or charge of whatsoever nature imposed or levied by or on behalf of Malaysia, or any authority thereof or therein having power to tax, unless such withholding or deduction is required by law whereby the Issuer shall be required to gross up any such deductions or withholdings. VI. Governing Laws The laws of Malaysia. VII. Transaction Documents The documents to be entered into for purposes of the CP/MTN Programme will include: 12

13 (a) Programme Agreement (with templates of tender panel agreement and subscription agreement); (b) Depository and Paying Agency Agreement; and (c) Trust Deed. 13