PROSPECTUS DATED 4 JANUARY 2008 (Registered by the Monetary
Authority of Singapore on 4 January 2008) THIS DOCUMENT IS
IMPORTANT. IF YOU ARE IN ANY DOUBT AS TO THE ACTION YOU SHOULD
TAKE, YOU SHOULD CONSULT YOUR LEGAL, FINANCIAL, TAX OR OTHER
PROFESSIONAL ADVISER. We have made an application to the Singapore
Exchange Securities Trading Limited (the SGX-ST) for permission to
deal in, and for quotation of, all the ordinary shares (the Shares)
in the capital of Old Chang Kee Ltd. (the Company) already issued
and the new Shares (the New Shares) which are the subject of this
Invitation (as defined herein). Such permission will be granted
when we have been admitted to the Official List of the Catalist.
The dealing in and quotation of our shares will be in Singapore
dollars. Our acceptance of applications for the New Shares will be
conditional upon, inter alia, permission being granted by the
SGX-ST to deal in, and for quotation of, all of the existing issued
Shares and the New Shares. Monies paid in respect of any
application accepted will, in the event such permission is not
granted, be returned to you at your own risk, without interest or
any share of revenue or other benefit arising therefrom, and you
will not have any claim whatsoever against us, the Manager (as
defined herein), the Underwriter (as defined herein) or the
Placement Agent (as defined herein). The SGX-ST assumes no
responsibility for the correctness of any of the statements made,
opinions expressed or reports contained in this Prospectus.
Admission to the Official List of the Catalist is not to be taken
as an indication of the merits of the Invitation, the Company, its
subsidiaries, the Shares or the New Shares. A copy of this
Prospectus has been lodged with and registered by the Monetary
Authority of Singapore (the Authority). The Authority assumes no
responsibility for the contents of this Prospectus. Registration of
this Prospectus by the Authority does not imply that the Securities
and Futures Act (Chapter 289) of Singapore, or any other legal or
regulatory requirements, have been complied with. The Authority has
not, in any way, considered the merits of the Shares or the New
Shares, as the case may be, being offered for investment. We have
not lodged or registered this Prospectus in any other jurisdiction.
No Shares shall be allotted or allocated on the basis of this
Prospectus later than six months after the date of registration of
this Prospectus by the Authority. Investing in the Shares involves
risks which are described in the section entitled Risk Factors of
this Prospectus. As part of the transitional arrangement announced
by the SGX-ST on 26 November 2007, the Company has been approved to
be listed on the Catalist. The Company has submitted its listing
application under the listing rules of SGX-SESDAQ and the SGX-ST
has reviewed the application based on the SGX-SESDAQ framework and
listing rules. The offer will be accompanied by a prospectus
registered by the Authority. The SGX-ST will publish a date from
which our Company and all existing SGX-SESDAQ listed companies are
required to comply with the listing rules of the Catalist (please
refer to the section entitled Replacement of SGX-SESDAQ by Catalist
and Appendix L of this Prospectus for more information).
OLD CHANG KEE LTD.(Incorporated in the Republic of Singapore on
16 December 2004) (Company Registration Number: 200416190W)
Invitation in respect of 25,000,000 New Shares comprising:(a) (b)
1,000,000 Offer Shares at S$0.20 for each Offer Share by way of
public offer; and 24,000,000 Placement Shares by way of placement,
comprising:(i) (ii) 22,500,000 Placement Shares at S$0.20 for each
Placement Share by way of applications made via Placement Shares
Application Forms; and 1,500,000 Reserved Shares at S$0.20 for each
Reserved Share reserved for our Non-Executive Directors,
management, employees, business associates and others who have
contributed to the success of our Group,
payable in full on application.Manager
Westcomb Capital Pte LtdPlacement Agent and Underwriter
Westcomb Securities Pte Ltd
SardineO
PepperO
SpringO
CurryO
Breaded Prawn OnStik
Chicken Nuggets OnStik
Pineapple Feelin
Fish Ball OnStik
Sotong Ball OnStik
Sotong OnStik
Sotong Wing OnStik
Yam Feelin
Fish Fillet OnStik
Sotong Nuggets OnStik
Crab Nuggets OnStik
Prawn Nuggets OnStik
Crab Claw OnStik
Pumpkin K8
Carrot K8
Yam K8
Green Bean Feelin
Crab Meat Wrap OnStik
Chicken Wrap OnStik
Sotong Wrap OnStik
deliversSeafood Gyoza OnStik Gyoza OnStik
CONTENTSPage CORPORATE INFORMATION
............................................................................................................
DEFINITIONS
......................................................................................................................................
DETAILS OF THE INVITATION Listing on the Catalist
......................................................................................................................
Indicative Timetable for Listing
........................................................................................................
REPLACEMENT OF SGX-SESDAQ BY CATALIST
..........................................................................
THE
INVITATION..................................................................................................................................
USE OF PROCEEDS FROM THE INVITATION AND EXPENSES INCURRED
................................ MANAGEMENT, UNDERWRITING AND
PLACEMENT ARRANGEMENTS......................................
EXCHANGE CONTROLS
....................................................................................................................
CLEARANCE AND SETTLEMENT
....................................................................................................
PLAN OF DISTRIBUTION
..................................................................................................................
CAUTIONARY NOTE ON FORWARD-LOOKING STATEMENTS
...................................................... SELLING
RESTRICTIONS
..................................................................................................................
PROSPECTUS SUMMARY
................................................................................................................
INVITATION STATISTICS
....................................................................................................................
RISK FACTORS Risks relating to our Business or our Industry
................................................................................
Risks relating to Ownership of our Shares
......................................................................................
MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS Combined Profit and Loss Accounts
................................................................................................
Combined Balance Sheet
................................................................................................................
Overview
..........................................................................................................................................
Review of Results of Operations
......................................................................................................
Review of Past Financial Position
....................................................................................................
Liquidity and Capital Resources
......................................................................................................
Material Capital Expenditure, Divestment and
Commitment............................................................
DIVIDEND POLICY
..............................................................................................................................
CAPITALISATION AND INDEBTEDNESS
..........................................................................................
DILUTION
............................................................................................................................................
4 6
14 17 18 19 20 21 23 26 27 30 31 32 34
35 41
44 45 46 50 55 57 60 62 63 65
1
CONTENTSPage GENERAL INFORMATION ON OUR COMPANY AND OUR GROUP
Share
Capital....................................................................................................................................
Significant Changes In Percentage of
Ownership............................................................................
Changes in Issued and Paid-Up Share Capital of our Company and our
Subsidiaries .................. Shareholders
....................................................................................................................................
Moratorium
......................................................................................................................................
RESTRUCTURING EXERCISE
..........................................................................................................
GROUP STRUCTURE
........................................................................................................................
OUR SUBSIDIARIES AND ASSOCIATED COMPANIES
..................................................................
OUR HISTORY
....................................................................................................................................
OUR BUSINESS Introduction
......................................................................................................................................
Our Products
....................................................................................................................................
Production Facility and Capacity
......................................................................................................
Retail Outlets
....................................................................................................................................
Enterprise Resource Planning System
............................................................................................
Quality
Control..................................................................................................................................
Marketing and Business Development
............................................................................................
Product Development
......................................................................................................................
Intellectual
Property..........................................................................................................................
Properties and Fixed Assets
............................................................................................................
Our Major Customers
......................................................................................................................
Our Major Suppliers
........................................................................................................................
Inventory Management
....................................................................................................................
Credit Policy
....................................................................................................................................
Government
Regulations..................................................................................................................
Insurance..........................................................................................................................................
Competition
......................................................................................................................................
Our Competitive Strengths
..............................................................................................................
Awards and Accreditation
................................................................................................................
PROSPECTS AND FUTURE PLANS
Prospects..........................................................................................................................................
Trend
Information..............................................................................................................................
Future Plans
....................................................................................................................................
DIRECTORS, MANAGEMENT AND EMPLOYEES Directors
..........................................................................................................................................
Management
....................................................................................................................................
Management Reporting Structure
....................................................................................................
Directors and Executive Officers Remuneration
............................................................................
Service Agreements
........................................................................................................................
Our Employees
................................................................................................................................
Board Practices
................................................................................................................................
CORPORATE GOVERNANCE
............................................................................................................
2
66 67 68 69 70 71 73 74 75
78 78 80 80 80 81 83 84 85 94 101 101 102 103 103 107 107 108
109
110 110 111
112 114 115 116 117 118 119 120
CONTENTSPage INTERESTED PERSON TRANSACTIONS Past Interested
Person Transactions
................................................................................................
Present and Ongoing Interested Person Transactions
....................................................................
Review Procedures for Future Interested Person Transactions
...................................................... CONFLICTS OF
INTEREST
................................................................................................................
GENERAL AND STATUTORY INFORMATION
..................................................................................
APPENDIX A Report from the Auditors and the Audited Combined
Financial Statements of Old Chang Kee Ltd. and its Subsidiary
Companies for the Financial Years Ended 31 December 2004, 2005 and
2006
................................................................................................
APPENDIX B Report from the Auditors and the Unaudited Combined
Financial Statements of Old Chang Kee Ltd. and its Subsidiary
Companies for the Financial Period from 1 January 2007 to 30 June
2007
....................................................................................................
APPENDIX C Extracts of our Articles of
Association..............................................................................................
APPENDIX D Description of Singapore Company Law relating to Shares
............................................................
APPENDIX E Summary of Relevant Australian Laws and Regulations
................................................................
APPENDIX F Summary of Relevant Malaysian Laws and Regulations
................................................................
APPENDIX G Summary of Relevant PRC Laws and
Regulations..........................................................................
APPENDIX H Summary of Relevant Thai Laws and Regulations
..........................................................................
APPENDIX I Taxation
............................................................................................................................................
APPENDIX J Terms, Conditions and Procedures for Application and
Acceptance .............................................. APPENDIX
K Report from the Auditors and the Unaudited Proforma Combined
Financial Statements of Old Chang Kee Ltd. and its Subsidiary
Companies for the Financial Year Ended 31 December 2006 and the
Financial Period from 1 January 2007 to 30 June 2007
....................................................................................................
APPENDIX L Key Changes under Catalist Rules
..................................................................................................
123 124 126 128 129
A-1
B-1
C-1
D-1
E-1
F-1
G-1
H-1
I-1
J-1
K-1
L-1
3
CORPORATE INFORMATIONBOARD OF DIRECTORS : Han Keen Juan
(Executive Chairman) Lim Tao-E William (Chief Executive Officer)
Choong Buat Ken (Non-Executive Director) Lim Yen Heng
(Non-Executive Director) Ong Chin Lin (Lead Independent Director)
Wong Chak Weng (Independent Director) Chew Mei Li, CPA
200416190W
COMPANY SECRETARY COMPANY REGISTRATION NUMBER REGISTERED
OFFICE
: :
:
2 Woodlands Terrace Singapore 738427 Boardroom Corporate &
Advisory Services Pte Ltd 3 Church Street #08-01 Samsung Hub
Singapore 049483 Westcomb Capital Pte Ltd 5 Shenton Way #09-07 UIC
Building Singapore 068808 Westcomb Securities Pte Ltd 5 Shenton Way
#09-08 UIC Building Singapore 068808 Shook Lin & Bok LLP 1
Robinson Road #18-00 AIA Tower Singapore 048542 Hardies Lawyers 45
Ventnor Avenue West Perth WA 6005 Australia Skrine Unit No. 50-8-1,
8th Floor Wisma UOA Damansara 50, Jalan Dungun Damansara Heights
50490 Kuala Lumpur Malaysia Royal Advocates International Limited
2/4 Nai Lert Tower Building 5th Floor, Lumpini Patuwan Bangkok
10330 Thailand
SHARE REGISTRAR
:
MANAGER
:
UNDERWRITER AND PLACEMENT AGENT
:
SOLICITORS TO THE INVITATION AND LEGAL ADVISERS TO OUR COMPANY
ON SINGAPORE LAW
:
LEGAL ADVISERS TO OUR COMPANY ON AUSTRALIAN LAW
:
LEGAL ADVISERS TO OUR COMPANY ON MALAYSIAN LAW
:
LEGAL ADVISERS TO OUR COMPANY ON THAI LAW
:
4
CORPORATE INFORMATIONLEGAL ADVISERS TO OUR COMPANY ON PRC LAW :
King & Wood 22/F, The City Tower 86 Section One Renminnanlu
Chengdu, Sichuan 610016 PRC Ernst & Young Certified Public
Accountants One Raffles Quay North Tower, Level 18 Singapore 048583
Partner-in-charge: Max Loh Khum Whai (a member of the Institute of
Certified Public Accountants of Singapore) RECEIVING BANKER :
Oversea-Chinese Banking Corporation Limited 65 Chulia Street OCBC
Centre Singapore 049513 Oversea-Chinese Banking Corporation Limited
65 Chulia Street OCBC Centre Singapore 049513 United Overseas Bank
Limited 80 Raffles Place UOB Plaza 1 Singapore 048624 CORPORATE
WEBSITE : http://www.oldchangkee.com (information contained on this
Internet website does not constitute a part of this Prospectus)
AUDITORS AND REPORTING ACCOUNTANTS
:
PRINCIPAL BANKERS
:
5
DEFINITIONSIn this Prospectus, the accompanying Application
Forms and, in relation to the Electronic Applications, the
instructions appearing on the screens of the ATMs of Participating
Banks or the IB websites of the relevant Participating Banks,
unless the context otherwise requires, the following definitions
apply throughout where the context so admits:-
Companies within our Group Company or Old Chang Kee Group Old
Chang Kee Australia Old Chang Kee China: : : : Old Chang Kee Ltd.
Our Company and its subsidiaries Old Chang Kee Australia Pty Ltd
Ten & Han Food Management (Chengdu) Co., Ltd.
Ten & Han Associated Companies Old Chang Kee Malaysia Old
Chang Kee Thailand
:
Ten & Han Trading Pte Ltd
: :
Old Chang Kee (M) Sdn. Bhd. Old Chang Kee (Thailand) Co.,
Ltd.
Other Companies, Organisations and Agencies 1901 Singapore
Auditors Authority AVA Catalist CDP or Depository FIC: : : : : : :
1901 Singapore Pte. Ltd. Ernst & Young Monetary Authority of
Singapore Agri-Food & Veterinary Authority of Singapore
Sponsor-supervised board The Central Depository (Pte) Limited
Foreign Investment Committee, under Malaysias Prime Ministers
Department, which regulates, inter alia, the acquisition of assets,
mergers and takeovers by local and foreign interests Housing and
Development Board PT. Old Chang Kee Ina Westcomb Securities Pte
Ltd
HDB Indonesian Franchisee Placement Agent or Underwriter Manager
MUIS
: : :
: :
Westcomb Capital Pte Ltd Majlis Ugama Islam Singapura (also
known as the Islamic Religious Council of Singapore) National
Environment Agency
NEA
:
6
DEFINITIONSParticipating Banks: DBS Bank Ltd (including POSB)
(DBS Bank), Oversea-Chinese Banking Corporation Limited (OCBC) and
United Overseas Bank Limited and its subsidiary, Far Eastern Bank
Limited (the UOB Group) OCK Food Chain Philippines, Inc. Pure
Options Pte. Ltd. Oversea-Chinese Banking Corporation Limited
SGX-ST Dealing and Automated Quotation System Singapore Exchange
Securities Trading Limited Boardroom Corporate & Advisory
Services Pte Ltd Asian Appraisal Company Pte Ltd
Philippines Franchisee Pure Options Receiving Banker SGX-SESDAQ
SGX-ST Share Registrar Valuer General Application Forms
: : : : : : :
:
The printed application forms to be used for the purpose of the
Invitation and which form part of this Prospectus The list of
applications for the subscription of the New Shares The articles of
association of our Company (a) in relation to an entity, means:(i)
in a case where the entity is a Substantial Shareholder,
Controlling Shareholder, substantial interest-holder or controlling
interest-holder, its related corporation, related entity,
associated company or associated entity; or in any other case:(aa)
(bb) a director or an equivalent person; where the entity is a
corporation, a Controlling Shareholder of the entity; where the
entity is not a corporation, a controlling interest-holder of the
entity; a subsidiary, a subsidiary entity, an associated company,
or an associated entity; or a subsidiary, a subsidiary entity, an
associated company, or an associated entity, of the Controlling
Shareholder or controlling interestholder, as the case may be,
Application List Articles of Association Associate
: : :
(ii)
(cc)
(dd)
(ee)
of the entity; and
7
DEFINITIONS(b) in relation to an individual, means:(i) (ii) his
immediate family; a trustee of any trust of which the individual or
any member of the individuals immediate family is, (aa) (bb) a
beneficiary; or where the trust is a discretionary trust, a
discretionary object,
when the trustee acts in that capacity; or (iii) any corporation
in which he and his immediate family (whether directly or
indirectly) have interests in voting shares of an aggregate of not
less than 30% of the total votes attached to all voting shares
Associated Company
:
in relation to an entity, means:(a) any corporation, other than
a subsidiary of the entity, in which:(i) the entity or one or more
of its subsidiaries or subsidiary entities has; the entity, one or
more of its subsidiaries and one or more of its subsidiary entities
together have; the entity and one or more of its subsidiaries
together have; the entity and one or more of its subsidiary
entities together have; or one or more of the subsidiaries of the
entity and one or more of the subsidiary entities of the entity
together have,
(ii)
(iii)
(iv)
(v)
a direct interest in voting shares of not less than 20% but not
more than 50% of the total votes attached to all voting shares in
the corporation; or (b) any corporation, other than a subsidiary of
the entity or a corporation which is an associated company of the
entity by virtue of paragraph (a), the policies of which:(i) the
entity or one or more of its subsidiaries or subsidiary entities;
the entity together with one or more of its subsidiaries and one or
more of its subsidiary entities; the entity together with one or
more of its subsidiaries;
(ii)
(iii)
8
DEFINITIONS(iv) the entity together with one or more of its
subsidiary entities; or one or more of the subsidiaries of the
entity together with one or more of the subsidiary entities of the
entity,
(v)
is or are able to control or influence materially
ATM ATM Application
: :
Automated teller machine of a Participating Bank An application
for the Offer Shares made through an ATM, subject to and on the
terms and conditions of this Prospectus The audit committee of our
Company as at the date of this Prospectus The board of Directors of
our Company Has the same meaning as in Section 2 of the Business
Trusts Act (Chapter 31A) of Singapore, as amended, supplemented or
modified from time to time Chief executive officer Companies Act
(Chapter 50) of Singapore, as amended, supplemented or modified
from time to time In relation to a corporation, means a person
who:(a) holds directly or indirectly interest in the voting shares
of the corporation and where the total votes attached to such
shares are 15% or more of the aggregate of the votes attached to
all the voting shares in the corporation; or in fact exercises
control over the corporation
Audit Committee
:
Board business trust
: :
CEO Companies Act
: :
Controlling Shareholder
:
(b)
CPF Directors Electronic Application EPS ERP
: : : : :
The Central Provident Fund The directors of our Company as at
the date of this Prospectus An ATM Application or an IB Application
Earnings per Share Enterprise Resource Planning, a type of system
which uses multiple components of computer software and hardware,
including but not limited to a unified database, to integrate all
data and processes of an organisation The executive Directors of
our Company The executive officers of our Group as at the date of
this Prospectus, who are also key executives as defined under the
Securities and Futures Act (Offers of Investment) (Shares and
Debentures) Regulations 2005
Executive Directors Executive Officers
: :
9
DEFINITIONSF&B FIE FP FY HACCP: : : : : Food and beverage
Foreign Investment Enterprise Financial period from 1 January to 30
June Financial year ended or, as the case may be, ending 31
December Hazard Analysis and Critical Control Point, a scientific,
rational and systematic approach to identify, assess and control
hazards during production, processing, manufacturing, preparation
and use of food to ensure that food is safe for consumption
Contains no pork, lard or other elements of impurities as defined
under Islamic law Internet banking An application for the Offer
Shares made through an IB website of one of the relevant
Participating Banks, subject to and on the terms and conditions of
this Prospectus The independent Directors of our Company The
invitation by our Company to the public to subscribe for the New
Shares, subject to and on the terms and conditions of this
Prospectus Initial public offering S$0.20 for each New Share 12
November 2007, being the latest practicable date prior to the
lodgment of this Prospectus with the Authority Listing manual of
the SGX-ST, as amended, supplemented or modified from time to time
A day on which the SGX-ST is open for trading in securities Mass
rapid transit Net asset value The 25,000,000 new Shares for which
our Company invites applications to subscribe pursuant to the
Invitation, subject to and on the terms and conditions of this
Prospectus The non-executive Directors (including Independent
Directors) of our Company The nominating committee of our Company
as at the date of this Prospectus The offer by our Company of the
Offer Shares to the public in Singapore for subscription at the
Issue Price, subject to and on the terms and conditions of this
Prospectus
Halal
:
IB IB Application
: :
Independent Directors Invitation
: :
IPO Issue Price Latest Practicable Date
: : :
Listing Manual
:
Market Day MRT NAV New Shares
: : : :
Non-Executive Directors
:
Nominating Committee
:
Offer
:
10
DEFINITIONSOffer Shares period under review Placement or
Placement Tranche: : : The 1,000,000 New Shares which are the
subject of the Offer FY2004, FY2005, FY2006 and FP2007 The
placement by the Placement Agent of the Placement Shares on behalf
of our Company for subscription at the Issue Price, subject to and
on the terms and conditions of this Prospectus The 24,000,000 New
Shares which are the subject of the Placement (including the
Reserved Shares) Peoples Republic of China, excluding Hong Kong
Special Administrative Region of PRC (Hong Kong), Macau Special
Administrative Region of PRC (Macau) and the Republic of China for
the purposes of this Prospectus and for geographical reference only
This Prospectus dated 4 January 2008 issued by our Company in
respect of the Invitation FY2004, FY2005, FY2006, FP2007 and the
period between 1 July 2007 to the Latest Practicable Date The
remuneration committee of our Company as at the date of this
Prospectus The 1,500,000 Placement Shares reserved for our
Non-Executive Directors, management, employees, business associates
and those who have contributed to the success of our Group The
restructuring exercise undertaken by our Group as described in the
section entitled Restructuring Exercise of this Prospectus Retail
shops and kiosks set up by our Group Securities account maintained
by a Depositor with CDP but does not include a securities
sub-account Securities and Futures Act (Chapter 289) of Singapore,
as amended, supplemented or modified from time to time The service
agreements entered into between our Company and our Executive
Directors, as described in the section entitled Service Agreements
of this Prospectus Ordinary shares in the capital of our Company
Registered holders of Shares, except where the registered holder is
CDP, the term Shareholders shall, in relation to such Shares, mean
the Depositors whose Securities Accounts are credited with Shares
The sub-division of each Share into 12 Shares as described in the
section entitled Share Capital of this Prospectus
Placement Shares
:
PRC
:
Prospectus
:
Relevant Period
:
Remuneration Committee
:
Reserved Shares
:
Restructuring Exercise
:
retail outlets Securities Account
: :
Securities and Futures Act
:
Service Agreements
:
Shares Shareholders
: :
Sub-division of Shares
:
11
DEFINITIONSSubstantial Shareholder: A person who has an interest
in voting shares of a corporation, and where the total votes
attached to such shares are not less than 5% of the total votes
attached to all the voting shares of the corporation Lim Tao-E
William
William Lim Currencies, Units and Others AUD or A$ RM or MYR RMB
S$ and cents THB US$ or USD sq ft % or per cent.
:
: : : : : : : :
Australian dollars Malaysian Ringgit PRC Renminbi Singapore
dollars and cents, respectively Thai Baht United States dollars
Square feet Per centum or percentage
Any reference to our, ourselves, us, we or other grammatical
variations thereof in this Prospectus is a reference to our
Company, our Group or any member of our Group as the context
requires. The terms Depositor, Depository Agent and Depository
Register shall have the meanings ascribed to them respectively in
Section 130A of the Companies Act. The term entity shall have the
same meaning ascribed to it in Section 2 of the Securities and
Futures Act, while the terms associated entity, controlling
interest-holder, related corporation, related entity, subsidiary,
subsidiary entity and substantial interest-holder shall have the
same meanings ascribed to them respectively in Paragraph 1 of the
Fourth Schedule of the Securities and Futures Act (Offers of
Investments) (Shares and Debentures) Regulations 2005. Words
importing the singular shall, where applicable, include the plural
and vice versa and words importing the masculine gender shall,
where applicable, include the feminine and neuter genders and vice
versa. References to persons shall include corporations. Any
reference in this Prospectus, the Application Forms or the
Electronic Applications to any statute or enactment is a reference
to that statute or enactment as for the time being amended or
re-enacted. Any word defined in the Companies Act, the Securities
and Futures Act or any statutory modification thereof or the
Listing Manual and used in this Prospectus, the Application Forms
and Electronic Applications shall, where applicable, have the
meaning assigned to it under the Companies Act, the Securities and
Futures Act or such statutory modification, or the Listing Manual,
as the case may be. Any reference in this Prospectus, the
Application Forms or the Electronic Applications to Shares being
allotted to an applicant includes allotment to CDP for the account
of that applicant. Any reference to a time of day or dates in this
Prospectus, the Application Forms or the Electronic Applications
shall be a reference to Singapore time or dates respectively,
unless otherwise stated.
12
DEFINITIONSCertain names with Chinese characters have been
translated into English names. These names can be identified by the
Chinese characters indicated beside the English names. Such
translations which are provided solely for the convenience of
investors, may not have been registered with the relevant PRC
authorities and should not be construed as representations that the
English names actually represent the Chinese characters. Any
discrepancies in the tables included in this Prospectus between the
listed amounts and the totals thereof are due to rounding.
Accordingly, figures shown in totals in certain tables may not be
an arithmetic aggregation of the figures which precede them.
13
DETAILS OF THE INVITATIONLISTING ON THE CATALIST As part of the
transitional arrangement announced by the SGX-ST on 26 November
2007, the Company has been approved to be listed on the Catalist.
The Company has submitted its listing application under the listing
rules of SGX-SESDAQ and the SGX-ST has reviewed the application
based on the SGXSESDAQ framework and listing rules. We have made an
application to the SGX-ST for permission to deal in, and for
quotation of, all our Shares already issued and the New Shares.
Such permission will be granted when our Company has been admitted
to the Official List of the Catalist. Our acceptance of
applications for the New Shares will be conditional upon, inter
alia, permission being granted by the SGX-ST to deal in, and for
quotation of, all of our existing issued Shares and the New Shares.
If such permission is not granted for any reason, monies paid in
respect of any application accepted will be returned to you at your
own risk, without interest or any share of revenue or other benefit
arising therefrom, and you will not have any claim whatsoever
against us, the Manager, the Underwriter or the Placement Agent.
The SGX-ST assumes no responsibility for the correctness of any of
the statements made, opinions expressed or reports contained in
this Prospectus. Admission to the Official List of the Catalist is
not to be taken as an indication of the merits of the Invitation,
the Company, its subsidiaries, the Shares or the New Shares. A copy
of this Prospectus has been lodged with and registered by the
Authority. The Authority assumes no responsibility for the contents
of this Prospectus. Registration of this Prospectus by the
Authority does not imply that the Securities and Futures Act, or
any other legal or regulatory requirements, have been complied
with. The Authority has not, in any way, considered the merits of
the Shares or the New Shares, as the case may be, being offered for
investment. No Shares shall be allotted or allocated on the basis
of this Prospectus later than six months after the date of
registration of this Prospectus by the Authority. We are subject to
the provisions of the Securities and Futures Act and the Listing
Manual regarding corporate disclosure. In particular, if after this
Prospectus is registered by the Authority but before the close of
the Invitation, we become aware of:(a) (b) a false or misleading
statement or matter in this Prospectus; an omission from this
Prospectus of any information that should have been included in it
under Section 243 of the Securities and Futures Act; or a new
circumstance that has arisen since this Prospectus was lodged with
the Authority which would have been required by Section 243 of the
Securities and Futures Act to be included in this Prospectus, if it
had arisen before this Prospectus was lodged,
(c)
that is materially adverse from the point of view of an
investor, we may lodge a supplementary or replacement prospectus
with the Authority pursuant to Section 241 of the Securities and
Futures Act. Where prior to the lodgment of the supplementary or
replacement prospectus, applications have been made under this
Prospectus to subscribe for the New Shares, and:(a) where the New
Shares have not been issued to you, our Company shall either:(i)
within seven days from the date of lodgment of the supplementary or
replacement prospectus give you the supplementary or replacement
prospectus, as the case may be, and provide you with an option to
withdraw your application; or
14
DETAILS OF THE INVITATION(ii) treat the applications as
withdrawn and cancelled, in which case your application shall be
deemed to have been withdrawn and cancelled and our Company shall,
within seven days from the date of lodgment of the supplementary or
replacement prospectus, return to you all monies which you have
paid on account of your application for the New Shares, without
interest or any share of revenue or other benefit arising therefrom
and at your own risk; or
(b)
where the New Shares have been issued to you, our Company shall
either:(i) within seven days from the date of lodgment of the
supplementary or replacement prospectus give you the supplementary
or replacement prospectus, as the case may be, and provide you with
an option to return to our Company the New Shares which you do not
wish to retain title in; or treat the issue of the New Shares as
void, in which case the issue shall be deemed void and our Company
shall, within seven days from the date of lodgment of the
supplementary or replacement prospectus, return to you all monies
which you have paid on account of your application for the New
Shares, without interest or any share of revenue or other benefit
arising therefrom and at your own risk.
(ii)
If you wish to exercise your option under paragraph (a)(i) above
to withdraw your application in respect of the New Shares, you
shall, within 14 days from the date of lodgment of the
supplementary or replacement prospectus, notify our Company of
this, whereupon our Company shall, within seven days from the
receipt of such notification, pay to you all monies paid by you on
account of your application for such New Shares, without interest
or any share of revenue or other benefit arising therefrom and at
your own risk. If you wish to exercise your option under paragraph
(b)(i) above to return the New Shares issued to you, you shall,
within 14 days from the date of lodgment of the supplementary or
replacement prospectus, notify our Company of this and return all
documents, if any, purporting to be evidence of title to those
Shares, to our Company, whereupon our Company shall, within seven
days from the receipt of such notification and documents, if any,
pay to you all monies paid by you for those New Shares, without
interest or any share of revenue or other benefit arising therefrom
and at your own risk. Under the Securities and Futures Act, the
Authority may, in certain circumstances issue a stop order pursuant
to Section 242 of the Securities and Futures Act (the Stop Order)
to our Company, directing that no New Share or no further Share to
which this Prospectus relates, be allotted or issued. Such
circumstances will include a situation where this Prospectus (i)
contains a statement or matter, which in the opinion of the
Authority, is false or misleading; (ii) omits any information that
should be included in accordance with the Securities and Futures
Act; or (iii) does not, in the opinion of the Authority, comply
with the requirements of the Securities and Futures Act. In the
event that the Authority issues a Stop Order and applications to
subscribe for the New Shares have been made prior to the Stop
Order, then:(a) where the New Shares have not been issued to you,
your application for the New Shares shall be deemed to have been
withdrawn and cancelled, and our Company shall, within 14 days from
the date of the Stop Order, pay to you all monies which you have
paid on account of your application for the New Shares, without
interest or any share of revenue or other benefit arising therefrom
and at your own risk; or where the New Shares have been issued to
you, the Securities and Futures Act provides that the issue of the
New Shares shall be deemed to be void, and our Company is required,
within 14 days from the date of the Stop Order, to pay to you all
monies which you have paid on account of your application for the
New Shares, without interest or any share of revenue or other
benefit arising therefrom and at your own risk.
(b)
15
DETAILS OF THE INVITATIONIn each of the above instances where
monies are refunded to you, it shall be paid to you without
interest or any share of revenue or other benefit arising therefrom
and at your own risk, and you will not have any claims against our
Company, the Manager, the Placement Agent or the Underwriter. This
Prospectus has been reviewed and approved by our Directors and they
individually and collectively accept full responsibility for the
accuracy of the information given in this Prospectus and confirm,
having made all reasonable enquiries, that to the best of their
knowledge and belief, the facts stated and the opinions expressed
in this Prospectus are fair and accurate in all material respects
as at the date of this Prospectus and that there are no material
facts the omission of which would make any statements in this
Prospectus misleading, and that this Prospectus constitutes full
and true disclosure of all material facts about the Invitation and
our Group. Neither our Company, the Manager, the Underwriter, the
Placement Agent nor any other party involved in the Invitation is
making any representation to any person regarding the legality of
an investment in our Shares by such person under any investment or
other laws or regulations. No information in this Prospectus should
be considered to be business, legal or tax advice regarding an
investment in our Shares. You should consult your own legal,
financial, tax or other professional adviser regarding an
investment in our Shares. No person has been or is authorised to
give any information or to make any representation not contained in
this Prospectus in connection with the Invitation and, if given or
made, such information or representation must not be relied upon as
having been authorised by us, the Manager, the Placement Agent or
the Underwriter. Neither the delivery of this Prospectus and the
Application Forms nor the Invitation shall, under any
circumstances, constitute a continuing representation or create any
suggestion or implication that there has been no change in the
affairs of our Company or our Group or in any statement of fact or
information contained in this Prospectus since the date of this
Prospectus. Where such changes occur, we may make an announcement
of the same to the SGX-ST and the public, and if required, lodge a
supplementary document or replacement document pursuant to Section
241 of the Securities and Futures Act and take immediate steps to
comply with Section 241 of the Securities and Futures Act. You
should take note of any such announcement and/or documents issued
by us in compliance with the Securities and Futures Act and, upon
release of such announcement and/or documents, shall be deemed to
have notice of such changes. Save as expressly stated in this
Prospectus, nothing herein is, or may be relied upon as, a promise
or representation as to our future performance or policies. This
Prospectus has been prepared solely for the purpose of the
Invitation and may not be relied upon by any persons other than
yourself in connection with your application for the New Shares or
for any other purpose. This Prospectus does not constitute an offer
or invitation or solicitation to subscribe for the New Shares in
any jurisdiction in which such offer, invitation or solicitation is
unauthorised or unlawful nor does it constitute an offer or
invitation or solicitation to any person to whom it is unlawful to
make such an offer or invitation or solicitation. Copies of this
Prospectus and the Application Forms may be obtained on request,
subject to availability, during office hours from:Westcomb
Securities Pte Ltd 5 Shenton Way #09-08 UIC Building Singapore
068808 and from members of the Association of Banks in Singapore,
members of the SGX-ST and merchant banks in Singapore. A copy of
this Prospectus is also available on the SGX-ST website
http://www.sgx.com and the Authoritys OPERA website at
http://masnet.mas.gov.sg/opera/sdrprosp.nsf.
16
DETAILS OF THE INVITATIONThe Application List will open at 10.00
a.m. on 14 January 2008 and will remain open until 12.00 noon on
the same day or such other period or periods as our Company may, in
consultation with the Manager, in their absolute discretion decide,
subject to any limitations under all applicable laws. In the event
a supplementary document or replacement document is lodged with the
Authority, the Application List will remain open for at least 14
days after the lodgment of the supplementary document or
replacement document. Details of the procedures for application for
the New Shares are set out in Appendix J of this Prospectus.
INDICATIVE TIMETABLE FOR LISTING The indicative timetable is set
out below for your reference:Indicative date/time 5 January 2008,
10.00 a.m. 14 January 2008, 12.00 noon 15 January 2008 Event
Opening of Invitation Close of Application List Balloting of
applications, if necessary (in the event of an over-subscription
for the Offer Shares) Commence trading on a ready basis Settlement
date for all trades done on a ready basis.
16 January 2008, 9.00 a.m. 21 January 2008
The above timetable is only indicative as it assumes that the
closing of the Application List takes place on 14 January 2008, the
date of admission of our Company to the Official List of the
Catalist will be 16 January 2008, the SGX-STs shareholding spread
requirement will be complied with and the New Shares will be issued
and fully paid-up prior to 16 January 2008. The actual date on
which our Shares will commence trading on a ready basis will be
announced when it is confirmed by the SGX-ST. The above timetable
and procedure may be subject to such modifications as the SGX-ST
may, in its discretion, decide, including the decision to permit
trading on a ready basis and the commencement date of such trading.
The commencement of trading on a ready basis will be entirely at
the discretion of the SGX-ST. All persons trading in our Shares
before their Securities Accounts with CDP are credited with the
relevant number of Shares will do so at the risk of selling Shares
which neither they nor their nominees, as the case may be, have
been allotted or are otherwise beneficially entitled to. In the
event of any changes in the closure of the Application List or the
time period during which the Invitation is open, we will publicly
announce the same:(i) through a SGXNET announcement to be posted on
the Internet at the SGX-ST website http://www.sgx.com; and in a
local English newspaper.
(ii)
Results of the Invitation including the allotment of the New
Shares and balloting (in the event of an oversubscription for the
Offer Shares) will be provided through the channels in (i) and (ii)
above. Investors should consult the SGX-ST announcement on the
ready listing date on the Internet (at the SGX-ST website
http://www.sgx.com) or the newspapers, or check with their brokers
on the date on which trading on a ready basis will commence.
17
REPLACEMENT OF SGX-SESDAQ BY CATALISTAs announced by the SGX-ST
on 26 November 2007, the SGX-SESDAQ will be replaced by a
sponsorsupervised board named Catalist on 17 December 2007. As our
Company will be listed after 17 December 2007, it will be listed on
Catalist. The SGX-ST will publish a date (Transition Date) from
which our Company and all existing SGX-SESDAQ issuers are required
to comply with the listing rules of Catalist (the Catalist Rules).
At least 12 months notice will be given and the SGX-ST may impose
conditions. Our Company must meet the following requirements by the
Transition Date:(a) (b) (c) submit an undertaking to, inter alia,
comply with the Catalist Rules to the SGX-ST; comply with any
conditions imposed by the SGX-ST; announce our intention to the
market giving no less than one months notice, including the name of
our Sponsor (as defined below) and the date from which we will
comply with the Catalist Rules as agreed with the SGX-ST; and send
a copy of the announcement to each Shareholder on our register at
the date of the announcement.
(d)
Until the above requirements have been met, our Company must
continue to comply with the SGXSESDAQ rules. Our Company may be
delisted if we fail to comply with the above requirements by the
Transition Date. A key feature of Catalist is that intermediaries
(Sponsors) will be authorised by the SGX-ST to act as either:(a) a
full Sponsor, authorised to undertake activities set out in
Catalist Rule 225 in preparing a listing applicant for admission or
advising an existing issuer in a very substantial acquisition or
reverse takeover as well as activities set out in Catalist Rule 226
in advising an existing issuer on compliance with the continuing
obligations under the Catalist Rules; or a continuing Sponsor,
authorised to undertake activities set out in Catalist Rule 226 in
advising an existing issuer on compliance with the continuing
obligations under the Catalist Rules.
(b)
With effect from the day from which we shall comply with the
Catalist Rules, we must retain a Sponsor at all times or face
delisting. The Sponsor will review all documents to be released by
us on Catalist to Shareholders or to the market (including
announcements, resolutions contained in notices of meetings,
circulars and corporate actions) before release, to ensure that our
Company complies with the Catalist Rules and makes the appropriate
disclosures. In its letter dated 16 November 2007, informing that
our Company is conditionally eligible for listing on the
SGX-SESDAQ, the SGX-ST has stated that notwithstanding that our
Company meets the Mainboard requirements at the time of listing, it
will only be considered for a transfer to the Mainboard if it
records substantially higher profits for each of the financial
years ending 31 December 2007 and 2008. Please refer to the Key
Changes Under Catalist Rules in Appendix L of this Prospectus for
information on the key changes which will affect our Company upon
the Catalist Rules coming into effect.
18
THE INVITATIONInvitation Size : 25,000,000 New Shares which
will, upon allotment and issue, rank pari passu in all respects
with our existing issued Shares. S$0.20 for each New Share. The
purpose of the Invitation is to secure admission of our Company to
the Official List of the Catalist. Our Directors consider that the
listing of our Company and the quotation of the Shares and the New
Shares on the Official List of the Catalist will enhance the public
image of our Group locally and overseas and enable us to tap the
capital markets to fund the expansion of our operations and enlarge
our capital base for the continued expansion of our business. The
Invitation will also provide members of the public, the
Non-Executive Directors, management, employees and business
associates as well as those who have contributed to our success
with an opportunity to participate in the equity of our Company.
The Offer comprises an invitation by our Company to the public in
Singapore to subscribe for 1,000,000 Offer Shares at the Issue
Price, subject to and on the terms and conditions of this
Prospectus. The Placement comprises a placement of 22,500,000
Placement Shares by way of Placement Shares Application Forms and
1,500,000 Reserved Shares by way of Reserved Shares Application
Forms, subject to and on the terms and conditions of this
Prospectus. 1,500,000 Reserved Shares (which form part of the
Placement Shares) will be reserved for our Non-Executive Directors,
management, employees, business associates and others who have
contributed to the success of our Group. In the event that any of
the Reserved Shares are not taken up, they will be made available
to satisfy applications for the Placement Shares, or in the event
of an under-subscription for the Placement Shares, to satisfy
applications made by members of the public for the Offer Shares.
Our Shares will be quoted in Singapore dollars on the Official List
of the Catalist, subject to admission of our Company to the
Official List of the Catalist and permission for dealing in, and
for quotation of, our Shares and the New Shares being granted by
the SGX-ST. Investing in our Shares involves risks which are
described in the section entitled Risk Factors of this
Prospectus.
Issue Price Purpose of the Invitation
: :
The Offer
:
The Placement
:
Reserved Shares
:
Listing Status
:
Risk Factors
:
19
USE OF PROCEEDS FROM THE INVITATION AND EXPENSES INCURREDNet
proceeds from the issue of the New Shares The net proceeds
attributable to our Company from the issue of the New Shares (after
deducting the estimated expenses in relation to the issue of the
New Shares of approximately S$1.7 million to be borne by our
Company) will be approximately S$3.3 million. The allocation of
each principal intended use of proceeds and the major expenses are
set out below:Amount allocated for each dollar of the proceeds
raised by our Company from the Invitation (as a % of the gross
proceeds)
Purpose Use of proceeds (i) (ii) (iii) (iv) Expand our overseas
operations Increase and refurbish our Singapore retail outlets
Expansion through strategic alliances, acquisitions, joint ventures
and franchises Working capital purposes
Estimated amount (S$000)
1,000 1,000 500 830
20.0 20.0 10.0 16.6
Invitation expenses (i) (ii) (iii) (iv) TOTAL Initial listing
and processing fees Professional fees Underwriting commission,
placement commission and brokerage (1) Miscellaneous expenses 70
1,100 150 350 5,000 1.4 22.0 3.0 7.0 100.0
Note:(1) Please refer to the section entitled Management,
Underwriting and Placement Arrangements of this Prospectus for more
details.
Please refer to the section entitled Prospects and Future Plans
of this Prospectus for more information on our use of proceeds. In
the opinion of our Directors, no minimum amount must be raised from
the issue of the New Shares. Pending deployment of the net proceeds
from the issue of the New Shares as aforesaid, the net proceeds may
be added to our Groups working capital, placed as deposits with
banks or financial institutions, or used for investment in
short-term deposits, money market instruments or debt instruments,
as our Directors may deem fit in their absolute discretion.
20
MANAGEMENT, UNDERWRITING AND PLACEMENT ARRANGEMENTSPursuant to a
management and underwriting agreement dated 4 January 2008 (the
Management and Underwriting Agreement), our Company appointed the
Manager, and the Manager has agreed, to manage the Invitation. The
Manager will receive a management fee from our Company for its
services rendered in connection with the Invitation as the Manager.
Pursuant to the Management and Underwriting Agreement, the
Underwriter agreed to underwrite the subscription of the Offer
Shares on the terms and conditions therein, and our Company agreed
to pay the Underwriter an underwriting commission of 2.75% of the
aggregate Issue Price for the total number of Offer Shares
successfully subscribed and the total number of Placement Shares
successfully applied to satisfy excess applications for Offer
Shares. Payment of the underwriting commission shall be made
whether or not any allotment of the Offer Shares is made to the
Underwriter or its nominees, including any portion of the Placement
Shares which have been applied to satisfy excess applications for
Offer Shares. Pursuant to the placement agreement dated 4 January
2008 (the Placement Agreement), the Placement Agent agreed to
subscribe for and/or procure subscribers for the Placement Shares
at the Issue Price. In consideration of the agreement of the
Placement Agent to subscribe for and/or procure subscribers for the
Placement Shares, our Company agreed to pay to the Placement Agent
a placement commission of 3.0% of the aggregate Issue Price for the
total number of Placement Shares successfully subscribed and the
total number of Offer Shares successfully applied to satisfy excess
applications for Placement Shares. Payment of the placement
commission shall be made whether or not any allotment of the
Placement Shares is made to the Placement Agent or its nominees,
including any portion of the Offer Shares which have been applied
to satisfy excess applications for Placement Shares. Brokerage will
be paid by our Company to the Underwriter, members of the SGX-ST,
banks and merchant banks in Singapore in respect of accepted
applications made on Application Forms bearing their respective
stamps, or to Participating Banks in respect of successful
applications made through ATM Applications or IB Applications, at
the rate of 0.25% of the Issue Price for each Offer Share. In
addition, DBS Bank levies a minimum brokerage fee of S$5,000 that
will be paid by our Company. Subscribers of the Placement Shares
(excluding the Reserved Shares) may be required to pay a brokerage
of up to 1.0% of the Issue Price as well as applicable stamp duties
and goods and services tax to the Placement Agent. If there shall
have been, since the date of the Management and Underwriting
Agreement and prior to or on the close of the Application List:(a)
(b) any breach of the warranties or undertakings in the Management
and Underwriting Agreement; or any occurrence of certain specified
events which comes to the knowledge of the Manager or the
Underwriter; or any adverse change, or any development involving a
prospective adverse change, in the condition (financial or
otherwise) of our Company or of our Group as a whole; or any
introduction or prospective introduction of or any change or
prospective change in any legislation, regulation, order, notice,
policy, rule, guideline or directive (whether or not having the
force of law and including, without limitation, any directive,
notice or request issued by the Authority, the Securities Industry
Council of Singapore, the SGX-ST or any other authority in
Singapore) or in the interpretation or application thereof by any
court, government body, regulatory authority or other competent
authority in Singapore; or any change, or any development involving
a prospective change or any crisis in local, national or
international financial (including stock market, foreign exchange
market, inter-bank market or interest rates or money market),
political, industrial, economic, legal or monetary conditions,
taxation or exchange controls; or
(c)
(d)
(e)
21
MANAGEMENT, UNDERWRITING AND PLACEMENT ARRANGEMENTS(f) any
occurrence or any local, national or international outbreak or
escalation of hostilities, insurrection or armed conflict (whether
or not involving financial markets and including but not limited to
any act of terrorism); or any regional or local outbreak of disease
that may have an adverse effect on the financial markets; or any
other occurrence of any nature whatsoever,
(g) (h)
which has resulted or is in the reasonable opinion of the
Manager likely to result in a material adverse fluctuation or
adverse conditions in the stock market and/or stock markets
overseas or in Singapore; or the success of the Invitation being
materially prejudiced; or it becoming impracticable, inadvisable,
inexpedient or not commercially viable or otherwise contrary to or
outside the usual commercial customs or practices in Singapore for
the Manager or the Underwriter to observe or perform or be obliged
to observe or perform the terms of the Management and Underwriting
Agreement or the Invitation; or the business, trading position,
operations or prospects of our Group being materially and adversely
affected, the Manager (for itself and for and on behalf of the
Underwriter) may at any time prior to the close of the Application
List by notice in writing to our Company rescind or terminate the
Management and Underwriting Agreement. The Manager or the
Underwriter may by notice in writing to our Company terminate the
Management and Underwriting Agreement if:(a) at any time up to the
commencement of trading of our Shares on the Catalist, a stop order
shall have been issued by the Authority in accordance with Section
242 of the Securities and Futures Act; or at any time after the
registration of this Prospectus by the Authority but before the
close of the Application List, our Company fails and/or neglects to
lodge a supplementary or replacement prospectus (as the case may
be) if it becomes aware of:(i) (ii) (iii) a false or misleading
statement or matter in this Prospectus; an omission from this
Prospectus of any information that should have been included in it
under Section 243 of the Securities and Futures Act; or a new
circumstance that has arisen since this Prospectus was lodged with
the Authority and would have been required by Section 243 of the
Securities and Future Act to be included in the Prospectus if it
had arisen before this Prospectus was lodged,
(b)
that is materially adverse from the point of view of an
investor; or (c) the Shares have not been admitted to the Official
List of the Catalist on or before 16 January 2008 (or such other
date as our Company and the Manager may agree).
In the event, the Placement Agent fails to receive valid
subscriptions and payments for at least 90.0% of the Placement
Shares by 6.00 p.m. on 9 January 2008 (or such other date as may be
decided by the Manager), the Placement Agent shall be entitled to
terminate the Placement Agreement. The obligations under the
Placement Agreement are conditional upon the Management and
Underwriting Agreement not being determined or rescinded pursuant
to the provisions of the Management and Underwriting Agreement. In
case of the non-fulfilment of any of the conditions in the
Management and Underwriting Agreement or the release or discharge
of the Manager and/or Underwriter (as the case may be) from their
obligations under or pursuant to the Management and Underwriting
Agreement, the Placement Agreement shall be terminated and the
parties shall be released from their respective obligations under
the Placement Agreement. Save as disclosed herein, there is no
material relationship between our Company, the Manager, the
Placement Agent or the Underwriter. 22
EXCHANGE CONTROLSSingapore There are no Singapore governmental
laws, decrees, regulations or other legislation in force that may
affect:(a) the import or export of capital, including the
availability of cash and cash equivalents for use by our Group; and
the remittance of dividends, interest or other payments to
non-resident holders of our Companys securities.
(b)
Australia With regards to the remittance of cash, Section 15 of
the Australian Financial Transaction Reports Act 1998 (Cth)
provides that it is an offence not to report to the Australian
Transaction Reports Analysis Centre (AUSTRAC) or a customs officer
a transfer of Australian or foreign currency (coin and paper
money), in the amount of A$10,000 or more, into or out of
Australia. The remittance of funds is governed by the Australian
Banking (Foreign Exchange) Regulations 1959, which are made under
the power conferred in Section 39 of the Australian Banking Act
1959 (Cth). Regulation 6 provides that a person shall not take or
send out of Australia any Australian or foreign currency without
the authority of the Reserve Bank of Australia (except for foreign
currency obtained by purchase of a money order issued at any post
office). Regulation 8 provides that a person shall not make any
payment in Australia to a person who is not a resident or place any
sum in Australia to the credit of such a person without the
authority of the Reserve Bank of Australia. However under
Regulation 38, the Reserve Bank of Australia may exempt any person,
transaction, security or goods from the whole or any of the
provisions of the Australian Banking (Foreign Exchange) Regulations
1959 (subject to directions from the Treasurer of the Commonwealth
of Australia). Regulation 38A also provides that the Reserve Bank
of Australia may issue a general authority authorising a person or
all persons to do an act or thing specified in the authority, which
would normally be prohibited by the Australian Banking (Foreign
Exchange) Regulations 1959. A general authority was issued on 29
June 1990 (replacing the previous authority issued on 18 December
1984) which provided that any person in Australia may send
Australian currency out of Australia and place currency to the
credit of a non-resident. As noted in the Australian Commonwealth
Gazette GN 27 dated 11 July 1990, all persons were exempted from
the application of Regulations 6 and 8 of the Australian Banking
(Foreign Exchange) Regulations 1959. Therefore, there is no barrier
to funds transfers into or out of Australia, provided the reporting
requirements of the Australian Financial Transaction Reports Act
1998 (Cth) are complied with. Malaysia There are no restrictions on
the repatriation of capital, profits, dividends, interest, fees or
rental by foreign direct investors or portfolio investors. PRC
Major reforms have been introduced to the foreign exchange control
system of PRC since 1993. On 1 October 1993, the State Council of
PRC issued the Notice on Further Reform of the Foreign Exchange
Control System and on 28 December 1993, the Peoples Bank of China
(PBOC), issued the Notice of the PBOC on Further Reform of the
Foreign Exchange Control System which came into effect on 1 January
1994. Other new regulations and implementation measures include the
Regulations on the
23
EXCHANGE CONTROLSForeign Exchange Settlement, Sale and Payments
which took effect on 1 July 1996 and which contain detailed
provisions regulating the settlement, sale and payment of foreign
exchange by enterprises, individuals, foreign organisations and
visitors in PRC and the Regulations of PRC on Foreign Exchange
Control which took effect on 1 April 1996 and which contain
detailed provisions in relation to foreign exchange control. On 21
July 2005, the PBOC issued the Public Announcement of the PBOC on
Improving the Reform of the RMB Exchange Rate Regime, which states
that from 21 July 2005, PRC will reform the exchange rate regime by
moving into a managed floating exchange rate regime based on market
supply and demand with reference to a basket of currencies. RMB
will no longer be pegged to the US$ and the RMB exchange rate
regime will be improved with greater flexibility. Under these new
regulations which contained detailed provisions regulating the
holding, sale and purchase of foreign exchange by individuals,
enterprises, economic bodies and social organizations in PRC, the
previous dual exchange rate system for RMB was abolished and a
unified floating exchange rate system based largely on supply and
demand was introduced. The PBOC publishes the RMB exchange rate
against the US$ and other major foreign currencies daily. The
medial price of one foreign currency against RMB is to be set by
reference to the US$/RMB and other major foreign currencies trading
price on the inter-bank foreign exchange market announced by PBOC
upon closing of business on the previous working day. In general,
unless otherwise approved by the State Council, all organisations
within PRC, including FIEs, are required to repatriate their
foreign exchange earnings to PRC. In relation to FIEs (including
sinoforeign equity joint ventures and sino-foreign co-operative
enterprises as well as wholly foreign owned enterprises (WFOE)),
they may maintain their recurrent foreign exchange earnings within
the highest sum determined by the State Administration of Foreign
Exchange (SAFE) or its local branch and the part beyond the sum
abovementioned shall be sold to the designated foreign exchange
banks or be sold through the foreign exchange swap transaction
center. At present, the enterprises within PRC which require
foreign exchange for their ordinary trading and nontrading
activities (such as payment of staff remuneration), import
activities and repayment of foreign debts may purchase foreign
exchange from designated banks if the application is supported by
the relevant documents and governmental approvals/registrations as
the case may be. FIEs may (subject to due payment of tax on such
dividends) distribute profits to their foreign investors with funds
in their foreign exchange bank accounts kept with designated banks.
Should the amount of funds in such foreign exchange bank accounts
be insufficient, the enterprises may purchase additional foreign
exchange from designated foreign exchange banks upon the
presentation of the resolutions of the directors on the profit
distribution plan of that particular enterprise and other documents
as required by the said banks in accordance with applicable PRC
laws. On 14 January 1997, the Regulations of the Peoples Republic
of China on Foreign Exchange Control (Regulations) was amended such
that the payment in and transfer of foreign exchange for current
international transactions will no longer be subject to PRC
government control or restrictions. Under the Regulations, FIEs may
buy, sell and/or remit foreign currencies at those banks authorized
to conduct foreign exchange business only upon providing valid
commercial documents and, in the case of capital account item
transactions, obtaining approval from the SAFE. Capital investments
by FIEs outside of PRC are also subject to limitations, which
include approvals by the Ministry of Commerce, the SAFE, the
National Development and Reform Commission and their respective
branches. Despite the aforementioned relaxation of foreign exchange
control over current account transactions, the approval of the SAFE
or its local branch is still required before a PRC enterprise may
provide any foreign exchange guarantee or make any investment
outside of PRC or enter into any other capital account transaction
involving the purchase of foreign exchange, except as otherwise
provided by PRC regulations. As to a foreign exchange loan, FIEs
are required to effect and complete the foreign exchange loan
registration with the SAFE or its local branch and to put the
foreign loan concerned on
24
EXCHANGE CONTROLSrecord. In addition, under certain notices
promulgated by the PBOC and the SAFE in 1998, all PRC borrowers of
foreign exchange loans are not permitted to purchase foreign
currencies with RMB to prepay such borrowings. However, according
to a notice published by the PBOC and the SAFE on 19 September
2001, in certain situations, a PRC borrower is allowed to purchase
foreign currencies with RMB to prepay onshore foreign exchange
loans subject to the approval of the SAFE. According to the Law of
PRC on Sino-Foreign Equity Joint Ventures, the net profit that the
foreign investors obtain from the FIEs may be remitted abroad in
accordance with the foreign exchange regulations and in the
currency or currencies specified in the contracts concerning the
ventures or deposit in the Bank of China part of the foreign
exchange which the foreign investors are entitled to remit abroad.
Thailand Thailands exchange controls are established by the
Exchange Control Act B.E. 2485, 1942 of Thailand. The Bank of
Thailand oversees all foreign exchange transactions. Commercial
banks established in Thailand designated by the Bank of Thailand as
its Authorised Agents handle and authorise outward remittances of
currencies. Currency transactions by non-listed companies that fall
within prescribed categories of transactions, such as outward
remittances of foreign currencies for the purpose of making
overseas investments in shareholding of less than 10% or loans
extended to overseas business establishments or paying securities
in overseas markets, are required to be approved by the Bank of
Thailand before the remittances of funds can take place. Approval
is not required for listed companies remitting foreign currencies
if the total amount of remittance does not exceed US$100,000,000
per year. Nor is the approval required for non-listed companies
remitting foreign currencies as investments or loans to
subsidiaries (in which the companies sending funds hold at least
10%) for the amount not exceeding US$50,000,000 per year. In the
event that our Thai associated company, Old Chang Kee Thailand, is
required to make outward remittances of currency which do not fall
within the prescribed categories of transactions, such as the
remittance of dividends, investment funds, profits, loan repayment
and interest payment thereon, such remittance shall, subject to the
payment of all applicable taxes in Thailand, have to be approved by
the Bank of Thailand through its Authorised Agents, provided that
the requisite documentary evidence shall be furnished to the
satisfaction of the remitting commercial bank prior to
remittance.
25
CLEARANCE AND SETTLEMENTUpon listing and quotation on the
Catalist, our Shares will be traded under the book-entry settlement
system of the CDP, and all dealings in and transactions of our
Shares through the Catalist will be effected in accordance with the
terms and conditions for the operation of Securities Accounts with
the CDP, as amended from time to time. Our Shares will be
registered in the name of CDP or its nominee and held by CDP for
and on behalf of persons who maintain, either directly or through
Depository Agents, Securities Accounts with CDP. Persons named as
direct securities account holders and Depository Agents in the
Depository Register maintained by the CDP, rather than CDP itself,
will be treated, under our Articles of Association and the
Companies Act, as members of our Company in respect of the number
of Shares credited to their respective Securities Accounts. Persons
holding our Shares in Securities Accounts with CDP may withdraw the
number of Shares they own from the book-entry settlement system in
the form of physical share certificates. Such share certificates
will, however, not be valid for delivery pursuant to trades
transacted on the Catalist, although they will be prima facie
evidence of title and may be transferred in accordance with our
Articles of Association. A fee of S$10.00 for each withdrawal of
1,000 Shares or less and a fee of S$25.00 for each withdrawal of
more than 1,000 Shares is payable upon withdrawing our Shares from
the book-entry settlement system and obtaining physical share
certificates. In addition, a fee of S$2.00 or such other amount as
our Directors may decide, is payable to the Share Registrar for
each share certificate issued and a stamp duty of S$10.00 is also
payable where our Shares are withdrawn in the name of the person
withdrawing our Shares or S$0.20 per S$100.00 or part thereof of
the last-transacted price where it is withdrawn in the name of a
third party. Persons holding physical share certificates who wish
to trade on the Catalist must deposit with CDP their share
certificates together with the duly executed and stamped
instruments of transfer in favour of CDP, and have their respective
Securities Accounts credited with the number of Shares deposited
before they can effect the desired trades. A fee of S$10.00 and
stamp duty of S$20.00 is payable upon the deposit of each
instrument of transfer with CDP. The above fees may be subject to
such changes as may be in accordance with CDPs prevailing policies
or the current tax policies that may be in force in Singapore from
time to time. Transactions in our Shares under the book-entry
settlement system will be reflected by the sellers Securities
Account being debited with the number of Shares sold and the buyers
Securities Account being credited with the number of Shares
acquired. No transfer of stamp duty is currently payable for the
Shares that are settled on a book-entry basis. A Singapore clearing
fee for trades in our Shares on the Catalist is payable at the rate
of 0.05% of the transaction value subject to a maximum of S$200.00
per transaction. The clearing fee, instrument of transfer deposit
fee and share withdrawal fee may be subject to Singapore goods and
services tax of 7.0%. Dealings of our Shares will be carried out in
Singapore dollars and will be effected for settlement on CDP on a
scripless basis. Settlement of trades on a normal ready basis on
the Catalist generally takes place on the third Market Day
following the transaction date, and payment for the securities is
generally settled on the following business day. CDP holds
securities on behalf of investors in Securities Accounts. An
investor may open a direct account with CDP or a subaccount with a
CDP agent. The CDP agent may be a member company of the SGX-ST,
bank, merchant bank or trust company.
26
PLAN OF DISTRIBUTIONThis section should be read in conjunction
with, and is qualified in its entirety by reference to Appendix J
of this Prospectus. The Issue Price was determined by us in
consultation with the Manager, the Placement Agent and the
Underwriter, after taking into consideration, inter alia,
prevailing market conditions and the estimated market demand for
our Shares through a book-building process. The Issue Price is the
same for all New Shares and is payable in full on application.
Applications for the New Shares You may apply to subscribe for any
number of New Shares in integral multiples of 1,000 Shares. In
order to ensure a reasonable spread of Shareholders, we have the
absolute discretion to prescribe a limit to the number of New
Shares to be allotted to any single applicant and/or to allot New
Shares above or under such prescribed limit as we shall deem fit.
Applications for the New Shares may be made using the following
methods:(1) Application for Offer Shares The Offer Shares are made
available to the members of the public in Singapore for
subscription at the Issue Price. The terms and conditions and
procedures for application are described in Appendix J of this
Prospectus. In the event of an under-subscription for the Offer
Shares at the close of the Application List, the number of Offer
Shares not subscribed for shall be made available to satisfy
applications for the Placement Shares to the extent there is an
over-subscription for the Placement Shares as at the close of the
Application List. In the event of an over-subscription for the
Offer Shares at the close of the Application List and the Placement
Shares are fully subscribed or over-subscribed as at the close of
the Application List, the successful applications for Offer Shares
will be determined by ballot or otherwise as determined by our
Directors and approved by the SGX-ST. Pursuant to the terms and
conditions contained in the Management and Underwriting Agreement,
the Underwriter has agreed to underwrite the Offer Shares. The
Underwriter may, at its absolute discretion, appoint one or more
sub-underwriters for the Offer Shares. (2) Application for
Placement Shares (excluding Reserved Shares) Pursuant to the terms
and conditions in the Placement Agreement, the Placement Agent
agreed to subscribe for and/or procure subscribers for the
Placement Shares. The Placement Agent may, at its absolute
discretion, appoint one or more sub-placement agents for the
Placement Shares. Subscribers of the Placement Shares (excluding
the Reserved Shares) may be required to pay a brokerage (and if so
required, such brokerage will be up to 1.0% of the Issue Price) as
well as applicable stamp duties and goods and services tax of 7.0%
to the Placement Agent. In the event of an under-subscription for
the Placement Shares as at the close of the Application List, that
number of Placement Shares not subscribed for shall be made
available to satisfy excess applications for the Offer Shares to
the extent that there is an over-subscription for the Offer Shares
as at the close of the Application List. In the event, the
Placement Agent fails to receive valid subscriptions and payments
for at least 90.0% of the Placement Shares by 6.00 p.m. on 9
January 2008 (or such other date as may be decided by the Manager),
the Placement Agent shall be entitled to terminate the Placement
Agreement.
27
PLAN OF DISTRIBUTIONApplication for Placement Shares (other than
Reserved Shares) The Placement Shares (other than Reserved Shares)
are reserved for placement to members of the public and
institutional investors in Singapore. Application for the Placement
Shares (other than Reserved Shares) under the Placement Tranche may
only be made by way of Placement Shares Application Forms. An
applicant who applies for the Placement Shares (other than Reserved
Shares) must complete a Placement Shares Application Form, and
shall not make any separate application for the Placement Shares
using another Placement Shares Application Form or for the Offer
Shares (either using an Offer Shares Application Form or by way of
an ATM Application or IB Application). Such separate applications
will be deemed to be multiple applications and all applications
shall be rejected. (3) Reserved Shares To recognise their
contributions to our Group, we have reserved 1,500,000 Placement
Shares for subscription by our Non-Executive Directors, management,
employees, business associates and others who have contributed to
the success of our Group at the Issue Price. These Reserved Shares
(other than those subscribed for by our Non-Executive Directors)
are not subject to any moratorium and may be disposed of after the
admission of our Company to the Official List of the Catalist. In
the event that any of the Reserved Shares are not subscribed for,
they will be made available to satisfy applications for the
Placement Shares to the extent that there is an oversubscription
for the Placement Shares as at the close of the Application List,
or in the event of an under-subscription of the Placement Shares as
at the close of the Application List, to satisfy applications made
by members of the public for the Offer Shares to the extent that
there is an over-subscription for the Offer Shares as at the close
of the Application List. You (not being an approved nominee company
in this paragraph) are allowed to submit ONLY ONE application in
your own name for:(a) the Offer Shares by any one of the
following:(i) (ii) (iii) OR (b) the Placement Shares (other than
Reserved Shares) by Placement Shares Application Form. Offer Shares
Application Form; or ATM Application; or IB Application,
If you submit or procure submissions of multiple share
applications for Offer Shares, Placement Shares (other than
Reserved Shares) or both Offer Shares and Placement Shares (other
than Reserved Shares), ALL YOUR APPLICATIONS SHALL BE DEEMED TO BE
MULTIPLE APPLICATIONS AND SHALL BE REJECTED. If you have made an
application for Reserved Shares, you may submit ONE application for
Offer Shares OR ONE application for Placement Shares (other than
Reserved Shares) provided that you adhere to the terms and
conditions of this Prospectus. Such applications shall not be
treated as multiple applications.
28
PLAN OF DISTRIBUTIONSubscription of the New Shares None of our
Directors (other than our Non-Executive Directors) or Substantial
Shareholders or their Associates intends to subscribe for the New
Shares. In the event that any of our Directors or Substantial
Shareholders or their Associates subscribes for any New Shares, we
will announce the details of such subscription. To the best of our
knowledge, we are not aware of any person who intends to subscribe
for more than 5.0% of the New Shares. However, through a
book-building process to assess market demand for our Shares, there
may be person(s) indicating interest to subscribe for more than
5.0% of the New Shares. The final allotment of the New Shares will
be in accordance with the shareholding spread and distribution
guidelines as set out in Rule 210 of the Listing Manual. No Shares
shall be allotted or allocated on the basis of this Prospectus
later than six months after the date of registration of this
Prospectus by the Authority.
29
CAUTIONARY NOTE ON FORWARD-LOOKING STATEMENTSAll statements
contained in this Prospectus, statements made in the press releases
and oral statements that may be made by our Company or our
officers, Directors or employees acting on our behalf, that are not
statements of historical fact, constitute forward-looking
statements. Some of these statements can be identified by words
that have a bias towards, or are forward-looking such as
anticipate, believe, could, estimate, expect, if, intend, may,
plan, possible, probable, project, should, will and would or
similar words. However, these words are not the exclusive means of
identifying forwardlooking statements. All statements regarding our
Groups expected financial position, business strategy, plans and
prospects and future prospects of our Groups industry are
forward-looking statements. These forward-looking statements,
including but not limited to statements as to our Groups revenue
and profitability, prospects, future plans, other expected industry
trends and other matters discussed in this Prospectus regarding
matters that are not historic facts, are only predictions. These
forward-looking statements involve known and unknown risks,
uncertainties and other factors that may cause our Groups actual
future results, performance or achievements to be materially
different from any future results, performance or achievements
expected, expressed or implied by such forward-looking statements.
These factors include, amongst others, changes in the political,
social and economic conditions and regulatory environment in
Singapore, Malaysia, Thailand, Australia, PRC and other countries
where we may conduct our business, changes in competitive
conditions, and other factors beyond our control. Some of these
risk factors are discussed in more detail in the section entitled
Risk Factors of this Prospectus. All forward-looking statements
made by or attributable to us, or persons acting on our behalf,
contained in this Prospectus are expressly qualified in their
entirety by such factors. Given the risks and uncertainties that
may cause our Groups actual future results, performance or
achievements to be materially different from that expected,
expressed or implied by the forward-looking statements in this
Prospectus, undue reliance must not be placed on these statements.
Our actual results may differ materially from those anticipated in
these forward-looking statements. Neither our Company, the Manager,
the Underwriter, the Placement Agent, their respective advisers nor
any other person represents or warrants that our Groups actual
future results, performance or achievements will be as discussed in
those statements. Further, our Company, the Manager, the
Underwriter and the Placement Agent disclaim any responsibility to
update any of those forward-looking statements or publicly announce
any revisions to those forward-looking statements to reflect future
developments, events or circumstances, even if new information
becomes available or other events occur in the future. We are,
however, subject to the provisions of the Securities and Futures
Act and the Listing Manual regarding corporate disclosure. In
particular, pursuant to Section 241 of the Securities and Futures
Act, if after this Prospectus is registered by the Authority but
before the close of this Invitation, our Company becomes aware of:
(a) a false or misleading statement or matter in this Prospectus;
(b) an omission from this Prospectus of any information that should
have been included in it under Section 243 of the Securities and
Futures Act; or (c) a new circumstance that h