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PART I – Introduction

Introduction

The definitions contained in the “Definitions” section of these Listings Requirements apply to this Introduction.

Objectives
It is an integral function of the LuSE to provide facilities for the listing of securities (including securities issued by companies, domestic or foreign), to provide the LuSE’s users with an orderly market place for trading in such securities and to regulate the market accordingly.

The Listings Requirements set out in this document apply to issuers seeking a listing for the first time, presently listed issuers, all other securities that applicants may wish to list and those presently listed and, where applicable, to directors (as defined in each relevant section) of applicant issuers and to brokers. The Listings Requirements contain the rules and procedures governing new applications, all corporate actions and continuing obligations applicable to issuers. They are furthermore aimed at ensuring that the business of the LuSE is carried on with due regard to the public interest.

General Principles
It is impracticable and undesirable for the LuSE’s requirements and procedures to attempt to govern all circumstances that may arise in commercial practice.

Accordingly, the Listings Requirements fall into two categories as follows:

  • (a) general principles (“the General Principles”) which are set out below and which must be observed in all corporate actions and also in all submissions pertaining to securities listed and to be listed; and
  • (b) the main body of the Listings Requirements (“the main body”) which consists of the sections, schedules and practice notes. The main body is
    derived from the application and interpretation of the General Principles by the LuSE.

Moreover, the spirit of the General Principles and the main body may be applied by the LuSE in areas or circumstances not expressly covered in the Listings Requirements.

The LuSE has discretion to modify the application of a requirement contained in the main body in exceptional circumstances, for example when the LuSE considers that the strict application of the requirement would conflict with the General Principles.

Accordingly, users of the Listings Requirements must at all times observe the spirit as well as the precise wording of the General Principles and main body.

If there is any doubt as to the interpretation or application of the Listings Requirements, users must consult the LuSE.

The General Principles are as follows:

  • (i) to ensure the existence of a market for the raising of primary capital, an efficient mechanism for the trading of securities in the secondary market, and to protect investors;
  • (ii) to ensure that securities will be admitted to the List only if the LuSE is satisfied that it is appropriate for those securities to be listed;
  • (iii) to ensure that full, equal and timeous public disclosure is made to all holders of securities and the general public at large regarding the activities of an issuer that are price sensitive;
  • (iv) to ensure that holders of relevant securities are given full information and are afforded adequate opportunity to consider in advance and vote upon any of the following:
  • (1) substantial changes in an issuer’s business operations; and
  • (2) other matters affecting a listed company’s constitution or the rights of holders of securities;
  • (v) to ensure that all parties involved in the dissemination of information into the market place, whether directly to holders of relevant securities or to the public, observe the highest standards of care in doing so;
  • (vi) to ensure that all holders of the same class of securities of an issuer are accorded fair and equal treatment in respect of their securities; and
  • (vii) to ensure that the Listings Requirements, and in particular the continuing obligations, promote investor confidence in standards of disclosure and corporate governance in the conduct of applicant issuers’ affairs and in the market as a whole.

Competent authority
The LuSE is the holder of an exchange licence in terms of the provisions of the Act. A company wishing to have its securities dealt with on the LuSE must apply for a listing and must be in compliance with the requirements of the LuSE before being granted such listing. The Board of the LuSE is the competent authority responsible for:

  • the list of the securities which may be dealt in on the LuSE;
  • applications by applicant issuers for the listing of securities on the LuSE; and  the annual revision of the List.

The Board of the LuSE has delegated its authority in relation to the Listings Requirements, excluding termination of listings initiated at the instance of the LuSE (which authority has been delegated to the LuSE’s executive committee), to the management of the Issuer Services Division. When a listings matter is considered by the LuSE, representatives of the issuer and other advisers may accompany the relevant sponsor, any of whom may, subject to the LuSE’s consent, address the meeting. The LuSE reserves the right to limit the number of persons attending such meetings.

Companies with listings on other exchanges Attention is drawn to the fact that other exchanges may have different requirements relating to the issue of securities. Companies with a primary listing on the LuSE that are also listed on such other exchanges should therefore ensure that the requirements of both the LuSE and such other exchanges are complied with when submitting documentation to the LuSE for approval. Where an issuer’s primary listing is on another exchange, the LuSE will normally accept the listings requirements of that exchange but reserves the right to request such issuer to comply with such aspects of the Listings Requirements as it may, in its sole discretion, determine.

Application of Rules
The Listings Requirements shall not apply to the listings of Debt Securities. The Listing Requirements applicable to Debt Securities are contained in a separate body of listing requirements for Debt Securities.

PART II – Schedules

Schedules

Throughout these schedules the definitions in the “Definitions” section of the Listings Requirements are applicable, unless otherwise stated or the context requires otherwise, and an expression, which denotes any gender, includes other genders.

The following schedules form part of the Listings Requirements:
1 Application for listing by new applicants
2 Application for a listing of securities resulting from rights offers, claw-back offers and renounceable offers
3 Application for a listing of securities resulting from capitalisation issues or scrip dividends
4 Application for a listing of securities resulting from acquisitions, take-overs and mergers, share incentive schemes and convertible securities
5 Independent fairness opinions
5A Expert’s confirmation of independence
5B Expert’s confirmation of competency
5C Declaration by the issuer
6 Application for a listing of securities resulting from an issue for cash
7 General undertaking
8 Statutory declaration
9 Mechanical signatures on certificates of title
10 Requirements for articles of association
11 Requirements for certificates of title
12 Requirements for option certificates in respect of listed options
13 Rescue operations
14 Requirements for share incentive schemes
15 Repealed
16 Sponsoring Brokers
17 Declaration by sponsoring broker
18 Annual compliance certificate
19 Procedural requirements of the Securities Exchange News Service
20 Standard wording for cautionary announcements
21 Directors declaration
22 Application for the de-listing of shares arising out of a repurchase of shares
23 The use of electronic media for the delivery of investor information
24 Corporate action timetables
25 Working capital

Schedule I

Application for listing by new applicants

1.2 The application for listing by new applicants must contain the following:

(a) a statement that:

  • “It is understood that the granting of a listing pursuant to this application shall constitute a contract between this company*/or description of entity applying for listing if not a company* and the LuSE Limited (“LuSE”) and also between the directors*/description of office equivalent to
    directors*, on a continuing basis, of the company*/or description of entity applying for listing if not a company* and the LuSE, and that in giving the General Undertaking referred to in paragraph 16.10 (s) of the Listings Requirements of the LuSE (“the Listings Requirements”), the
    company*/or description of entity applying for listing if not a company* and its directors*/description of office equivalent to directors* undertake to comply with the Listings Requirements as they may exist from time to time.” * delete whichever is not applicable;

(b) full name of the applicant;

(c) the addresses of the registered and transfer offices of the applicant in the Republic of Zambia;

(d) regarding the applicant’s share capital:

(i) the amount of the authorised share capital of each class of share, and the nominal value and number of securities in each class; and
(ii) the number and amount of the share capital issued and to be issued with respect to each class of share, and the number of securities in each class for which a listing is applied for;

(e) the nominal amount and number of securities of each class:
(i) offered to the public for subscription, either by the applicant or otherwise (“the offer”), and the date the offer opened;
(ii) applied for in terms of the offer, and the date the offer closed (where this information is available at the date of application); and
(iii) issued and/or allotted, and the date of issue and/or allotment (where this information is available at the date of application) pursuant to
the offer;

(f) that monies in respect of excess applications will be refunded within 7 days of the closing of the offer;

(g) a statement whether or not it is desired to deal in any other documents prior to the issue and allotment of the securities;

(h) a statement detailing the sector of the List in which listing is applied for, and the abbreviated name of the applicant.

(i) an undertaking by the applicant in the form of a directors’, or equivalent, resolution that the documents referred to in paragraphs 16.19 to 16.21 will be submitted within the periods specified therein; and

1.2 The application must be signed by the secretary and a director, or equivalent, of the applicant and by the sponsoring broker.

1.3 The application must be accompanied by a resolution of the directors, or equivalent, of the applicant authorising the application for listing together with the relevant listing fee.

Schedule II

Application for a listing of securities resulting from rights offers, claw-back
offers and renounceable offers

2.1 The application for the listing of securities resulting from rights offers, clawback offers and renounceable offers must include:

(a) a description of and the number of renounceable letters for which a listing is applied for, and the relevant dates, in accordance with the relevant timetable in Schedule 24;

(b) a description of and the number of securities for which a listing is applied for, and the relevant dates, in accordance with the relevant timetable in Schedule 24;

(c) a brief description of the offer;

(d) the date on which the renounceable letters and the circular or pre-listing statement will be posted to securities holders;

(e) the date on which the offer closes;

(f) the authorised and issued capital of the applicant prior to the issue of the rights, renounceable or claw-back securities;

(g) the issued capital after the issue of the rights, renounceable or claw-back securities; and

(h) all renounceable letters dispatched by the applicant to registered shareholders will be sent by registered mail and by airmail wherever this is possible;

(i) the date on which the securities are to be allotted and issued; and

(j) the date on which the renounceable letters are to be allotted and issued.

2.2 The application must be signed by the secretary and a director, or equivalent, of the applicant and by the sponsoring broker.

2.3 The application must be accompanied by a resolution of the directors, or equivalent, of the applicant and any other resolution required by the Act or any other written law authorising the application for listing together with the relevant listing fee.

Schedule III

Application for a listing of securities resulting from capitalisation issues or
scrip dividends

3.1 The application for a listing of securities resulting from capitalisation issues or scrip dividends must state:

(a) the number of securities resulting from a capitalisation/scrip dividend issue for which a listing is applied;

(b) the date from which such listing is to commence;

(c) that the capitalisation/scrip dividend securities rank pari passu with the other issued securities of the applicant;

(d) the date on which the capitalisation/scrip dividend securities are to be allotted;

(e) the date on which the securities are to be issued;

(f) the authorised and issued share capital of the applicant prior to the issue of the capitalisation/scrip dividend securities; and

(g) the issued capital after the issue of the capitalisation/scrip dividend securities.

3.2 The application must be signed by the secretary and a director, or equivalent, of the applicant and by the sponsoring broker.

3.3 The application must be accompanied by a resolution of the directors, or equivalent, of the applicant authorising the application for listing together with the relevant listing fee.

Schedule IV

Application for a listing of securities resulting from acquisitions, take-overs
and mergers, share incentive schemes and convertible securities

4.1 The application for a listing of securities resulting from acquisitions, take-overs and mergers, share incentive schemes and convertible securities must contain the following:

(a) a description of and the number of securities for which a listing is applied and the date of listing;

(b) the reason for allotment and issue;

(c) the date of allotment;

(d) the date of issue of securities;

(e) a statement that when the securities are issued and listed they will rank pari passu in all respects with existing issued and listed securities of the same class;

(f) the applicant’s present authorised and issued capital;

(g) the issued capital after the issue of the securities that are subject of the application;

(h) confirmation that, in respect of an acquisition of assets, the assets have been transferred into the name of the applicant, or will be upon issue of the securities or other means of consideration settlement;

(i) with regard to shares that are being issued in respect of the achievement of a profit warranty, reference to the date and medium (e.g. publication or in the annual financial statements) in which the details of the transaction were announced; and

(j) where the application relates to a vendor consideration placing, confirmation that the issuer has complied with paragraph 5.62.

4.2 The application must be signed by the secretary and a director, or equivalent, of the applicant and by the sponsoring broker.

4.3 The application must be accompanied by a resolution of the board of directors, or equivalent, of the applicant authorising the application for a listing together with the relevant listing fee.

4.4 An application for share incentive scheme shares utilising a previously approved block listing must include the balance of shares in issue before and after the block listing. The application for block listing should also include the previous application letter submitted by the issuer to the LuSE.

4.5 Where application is made to the LuSE to list securities which are the subject of a profit warranty, a letter submitted by the issuer’s auditors confirming that the conditions required for the shares to be allotted and issued have been met, is to be submitted to the LuSE together with a reconciliation between the number of securities for which application is being made and the terms of the profit warranty.

4.6 The application must be accompanied by the relevant agreements.

Schedule V

Independent fairness opinions

Scope of this schedule
The objectives of this schedule are as follows:

  • (a) to provide sponsoring brokers and issuers with certainty, at an early stage of the process, as to the acceptability or otherwise to the LuSE of a nominated independent professional expert who will issue a fairness opinion;
  • (b) to provide guidelines regarding the required quality of independent fairness opinions generally; and
  • (c) to ensure consistent and detailed reporting practices with regard to fairness opinions.

As the issues of independence and competency will be unique to every transaction, this schedule provides guidance rather than specific rules. The overriding objective is to ensure that the board of directors receive competent and adequate advice from an acceptable independent and competent third party regarding a transaction. The board of directors must ensure that any director who is party to the transaction (being the subject
matter of the fairness opinion) is excluded from the process of mandating the expert and providing the necessary recommendations to shareholders. The issuer must confirm this in terms of the Schedule 5C declaration.

5.1 A fairness opinion must:

  • (a) be prepared by an independent professional expert, acceptable to the LuSE, who has no material interest either in the transaction or in the success or failure of the transaction;
  • (b) make appropriate disclosure where the independent professional expert has any existing or continuing relationship with the issuer and/or any other parties involved in the transaction; and
  • (c) set out all of the material factors and assumptions taken into account in the preparation of the statement (as set out in 5.8 below).

5.2 At an early stage in a contemplated transaction and preferably before engaging a party to prepare a fairness opinion, the sponsoring broker, on behalf of the issuer must submit to the LuSE:

  • (a) a declaration of independence completed by the nominated independent professional expert, in the form set out in Schedule 5A;
  • (b) a declaration of competency completed by the nominated independent professional expert, in the form set out in Schedule 5B; and
  • (c) a declaration by the issuer, in the form set out in Schedule 5C.

The above declarations must be submitted for every transaction.

5.3 The LuSE may, unless the issuer is able to provide additional information to satisfy the LuSE, require the issuer to appoint a different independent professional expert to prepare the fairness opinion if (based on the information received in terms of 5.2 above and the LuSE’s investigation thereof) the LuSE is not satisfied as to:

  • (a) the independence of the nominated independent professional expert; and/or
  • (b) the competency of the nominated independent professional expert with regard to the particular transaction; and/or (c) any reasons given by the issuer for the appointment of the nominated independent professional expert.
  • 5.4 The LuSE undertakes to give the sponsoring broker its approval or disapproval for the appointment of the independent professional expert within 48 hours (excluding weekends and public holidays) of receipt of the duly completed declarations required in 5.2 above. No documentation will be accepted for review by the LuSE until approval for the appointment has been given.

5.5 Before issuing a fairness opinion, the independent professional expert must perform a valuation of the issuer and/or the subject of the transaction. Where a valuation has been prepared by a competent third party (in respect of assets such as property or mineral reserves and rights for example), the independent professional expert should set out the manner in which he has satisfied himself that he can rely upon the valuation.

5.6 The LuSE’s request for the opinion of an independent professional expert may result in a statement that the transaction is fair. Where this is not the case and the fairness is impaired, the independent professional expert should give full reasons for his opinion in this regard. Even if the opinion is that the transaction is fair, the independent professional expert must, where appropriate, emphasise critical matters upon which it has relied upon in arriving at the opinion.

5.7 The LuSE only requires that the expert opine on the fairness of a transaction although it would allow the expert to opine on the reasonableness provided detailed disclosure is made in this regard. Fairness is based on quantitative issues and reasonableness on qualitative issues. For illustrative purposes, in the case of a disposal to a related party, the transaction may be said to be fair if the consideration payable by the related party is equal to or greater than the value of the business that is the subject of the transaction. In other instances, even though the consideration may be lower than the value of the business, the transaction may be said to be reasonable in certain circumstances after considering other significant qualitative factors.

5.8 The content of the fairness opinion is at the discretion of the independent professional expert, but must include at least the following basic elements:

  • (a) title;
  • (b) addressee;
  • (c) date of statement;
  • (d) opening or introductory paragraph with the purpose for which the report has been prepared;
  • (e) reference to the relevant LuSE or SRP rules in terms of which the statement is being issued;
  • (f) headings identifying the major sections including, but not limited to, introduction, procedures and the opinion;
  • (g) an explanation as to how the terms “fair” and if so mandated by the board of directors “reasonable”, as indicated in 5.6 above, apply in the context of the specific transaction;
  • (h) details of the information and sources of information;
  • (i) identification and discussion of both the external and internal key value drivers, sensitivities performed and assumptions used;
  • (j) if applicable, a summary of the manner in which the independent professional expert has satisfied itself as to the appropriateness and
    reasonableness of the underlying information and assumptions;
  • (k) a full explanation of the significant factors that led to the opinion given;
  • (l) any limiting conditions;
  • (m) the relationships between the issuer (and any other parties involved in the transaction) and the independent professional expert, as required by 5.1(b) above and as identified in the declaration completed in terms of 5.2(a) above and disclosure of the number and value of shares acquired if the expert’s fees were paid for in shares;
  • (n) confirmation that a valuation has been performed and identification of the valuation methodologies applied, and where there has been reliance upon a third party valuation, confirmation that the independent expert is satisfied with this valuation;
  • (o) a summary of other factors taken into account or procedures carried out in reaching the opinion;
  • (p) a statement that an individual shareholder’s decision may be influenced by such shareholder’s particular circumstances and accordingly that a
    shareholder should consult an independent advisor if in any doubt as to the merits or otherwise of the transaction;
  • (q) the opinion;
  • (r) the independent professional expert’s name, address and authorised signature; and
  • (s) any other information that the independent professional expert feels is appropriate.

5.9 The date on which the opinion is issued must be the same as the date that the directors authorise the submission of the relevant circular to the LuSE for formal approval.

5.10 The independent professional expert has a duty to evaluate all the information provided in a critical manner, as required in 5.8(i) above. This in no way implies that the information must be audited or that the accuracy of all information must be checked. There must be a statement as to how the information has been evaluated and whether or not the expert believes that such information is reasonable, particularly where the information contains forecasts prepared by the management and/or directors of the issuer. Any statement indicating that there has been no independent verification or any other similar statement would only be permissible subject to the following:

  • (a) the experts stating clearly what is meant by “no independent verification”; and
  • (b) such statement not invalidating any work that has been done in terms of this paragraph.

5.11 The LuSE has the right, but not the obligation, to request the independent professional expert to;

  • (a) clarify any aspect of the statement; and/or
  • (b) expand the statement so as to address any issues of concern to the LuSE.

Schedule 5A

Expert’s confirmation of independence

[please delete any paragraphs which are not applicable and which are the subject of a matter choice between paragraphs]

To: The Listings Committee,
LuSE
Central Park
Cairo Road
LUSAKA
……………….. 20 ……….

This declaration is completed with reference to:[insert name of listed company] (“the issuer”), the holding company, subsidiary companies, associate companies and joint ventures of the issuer (“the issuer’s related parties”);

[insert brief description of the transaction] (“the transaction”).

We acknowledge that this declaration has been requested by the LuSE for the purpose of confirming to the LuSE that we have no direct or indirect material interest in the transaction, or in the success or failure of the transaction that may mitigate against our appointment as the independent professional experts for the transaction.

We further acknowledge that the independent professional expert may be;

(a) a company or other entity that does not form part of a larger organisation;

(b) a company or other entity within a larger organisation that can potentially offer a wide range of services to the issuer; or

(c) a division within a company or other entity that falls into either of the two categories above.

This declaration is therefore made in the context that it relates to the individuals, the division and/or the company directly responsible for undertaking the work and issuing the opinion, as well as any other parties within the larger organisation (if applicable) that are involved in issuing the opinion or will directly benefit or profit from the transaction.

Full name of the independent professional expert: ……………………………………………………..(“the expert”), a division/associate/subsidiary of ……………………………………………………………………………..I, ………………………………………………………………………………………………. [insert full names] being a …………………………………………. [insert relationship to expert e.g. director/partner] and duly authorised on behalf of the expert to give this declaration, declare as follows:

1. Internal confidentiality procedures
(a) The expert and, if applicable, the group of companies to which the expert belongs or any other organisation to which the expert belongs, have
internal compliance procedures in place dealing with communication amongst their employees and contractors and amongst the different companies and divisions so as to ensure that information is kept confidential when appropriate;

(b) Through these procedures, information of a non public nature regarding the transaction is unknown to anyone outside of the expert and its larger organisation. In addition, the expert cannot be influenced with regard to the procedures that it follows and the opinion that it will express regarding the transaction;

These procedures are as follows …………………………….. [please provide full details]. In addition, the expert has no objection to the holding discussions with our legal compliance department.

2. Shareholding by directors/partners/employees etc of the expert in the issuer

(a) The persons who are directors, partners, officers, employees, consultants or contractors (“staff”) of the expert and who are involved in the activities of the expert in relation to the transaction and who further have an interest in any class of share, debt or loan capital of the issuer, the related parties to the issuer or any other party involved in the transaction or who may benefit from the transaction, are as follows:

Name of company Nature of holding Holding number of shares Kwacha value of holding as at date of Name of registered holder and
beneficial owner and relationship of beneficial owner to the expert

The expert does not believe that the above holdings will compromise the independence of the expert because ……………………….. [please provide full explanation per individual disclosure] or

(b) No persons who form part of the staff of the expert or who are otherwise directly or indirectly involved in the activities of the expert in relation to the transaction have any interest in any class of share, debt or loan capital of the issuer, the related parties to the issuer or any other party involved in the transaction or who may benefit from the transaction; and

(c) The information given in (a) and (b) above has not changed in the last 6 months; or

(d) The information given in (a) and (b) has changed to the extent of ……………………. [please provide full details of all changes].

3. Shareholding of the expert in the issuer

(a) The expert and the following companies and funds under the management of the expert have an interest (being all such interests of which the expert or the compliance department is aware) in the following shares, debt (short term or long term) and loan capital of the issuer and/or any other company which is one of the issuer’s related parties and/or any other party involved in the transaction or who may benefit from the transaction;

Issuer or group company Nature of holding Holding (number of shares and %) Kwacha value of holding as at date of letter Name of registered holder and
beneficial owner and relationship of beneficial owner to the expert

The expert does not believe that these holdings will compromise the independence of the expert because…………………………………….. [please provide full explanation per individual disclosure] or

(b) Neither the expert nor any companies or funds under the management of the expert, has any interest (of which the expert or the compliance
department is aware) in any class of share, debt (short term or long term) or loan capital of the issuer and/or any other company which is one of the issuer’s related parties and/or any other party involved in the transaction or who may benefit from the transaction; and

(c) The information given in (a) and (b) above has not changed in the last 6 months; or

(d) The information given in (a) and (b) has changed to the extent of……………………………. [please provide full details of all changes]

4. Directorships of the staff of the expert

(a) The individuals named below, who form part of the staff of the expert, or any subsidiary or associate company of the expert, or the expert’s holding company, or any company in the expert’s holding company’s group are directors of the issuer, or of a company which is one of the issuer’s related parties or any other party involved in the transaction or who may benefit from the transaction;

Name Employer Company of
which individual
is a director
Nature of directorship
(executive or non-executive
and portfolio)

The expert confirms that the above individuals will take no part in the expert’s activities in relation to this transaction; or

(b) No staff of the expert, or any subsidiary or associate company of the expert, or the expert’s holding company, or any company in the experts holding company’s group is a director of the issuer, or a of a company which is one of the issuer’s related parties or any other party involved in the transaction or who may benefit from the transaction; and

(c) The information given in (a) and (b) above has not changed in the last 6 months; or

(d) The information given in (a) and (b) has changed to the extent of ………………………. [please provide full details of all changes].

5. History of services provided to the issuer

(a) The expert (and all subsidiary, associate companies and related parties of the expert) has provided the issuer, and/or the issuer’s related parties, with the following services for the following fees, or other economic benefit during the last 24 months commencing from the date of the last financial year end of the issuer or six months after the last financial year end, whichever is the later:

Expert or
company
in the
expert’s group
Nature
of service
provided
Date service
provided
Fees
(or economic benefit)
as % of total fees
for the expert for
that financial period
(see Note 1)

(Note 1: disclosure has been made where this percentage is equal to or greater than 10% in the case of the expert itself or any subsidiary, associate company or related party of the expert). or

(b) The expert (and all subsidiary, associate companies and related parties of the expert) has not provided the issuer, and/or the issuer’s related parties, with services during the last 24 months; and

(c) The information given in (a) and (b) above has not changed in the last 6 months; or

(d) The information given in (a) and (b) has changed to the extent of ……………………. . [please provide full details of all changes].

(e) The issuer is not a material client of the expert’s holding company, or any company in the expert’s holding company’s group.

6. Shareholding by the staff of the issuer

(a) The issuer (and all subsidiary, associate companies and related parties of the issuer), the issuer’s holding company’s (and any company in the issuer’s holding company’s group) and the staff of the issuer, who beneficially, directly or indirectly hold 5% of more in the share capital of the expert and/or the experts holding company are as follows:

Name of person Nature of holding Holding (number of shares Name of registered holder and beneficial owner and relationship
of beneficial owner to the issuer

The expert does not believe that the above holdings will compromise the independence of the expert because ……………………….. [please provide full explanation per individual disclosure] or

(b) Neither the issuer (and all subsidiaries, associate companies and related parties of the issuer) nor the issuer’s holding company (and any company in the issuer’s holding company’s group) nor the staff of the issuer have 5% or more in the share capital of the expert and/or the experts holding company either beneficially, directly or indirectly.

7. Directorships of the staff of the issuer

(a) The individuals named below, who form part of the staff of the issuer, or any subsidiary or associate company of the issuer, or the issuer’s holding company, or any company in the issuer’s holding company’s group are directors of the expert or any related parties of the expert or any other party involved in the transaction or who may benefit from the transaction;

Name Employer Company of
which individual
is a director
Nature of directorship
(executive or non-executive
and portfolio)

The expert confirms that the above individuals will not be involved in the expert’s activities in relation to this transaction; or

(b) No staff of the issuer, or any subsidiary or associate company of the issuer, or the issuer’s holding company, or any company in the issuer’s holding company’s group is a director of the expert or any related parties of the expert or any other party involved in the transaction or who may benefit from the transaction.

9. Fees to be paid for providing the fairness opinion

(a) Neither the fees (or other benefit) to be paid for providing the fairness opinion nor any other fees (or other benefit) receivable from the issuer or the issuer’s related parties or any other party, are contingent upon the outcome of the transaction;

(b) the fee to be paid for providing the fairness opinion, expressed as a percentage of the fees:

(i) is less than 10% of the gross fees received by the expert for the last financial year of the expert; and
(ii) the total of all fees receivable from the issuer is not more than 5% of the budgeted fees of the expert for the current financial year.

If the expert is unable to provide a positive confirmation to (i) and/or (ii) they should provide the details of the fees, expressed as a percentage of the gross fees received by the expert for the last financial year and as expressed as a percentage of the budgeted fees for the expert for the current financial year;

(c) the fees payable for the fairness opinion are to be paid in shares of the issuer or are linked to the ability to be issued as shares, and the percentage holding which will be held by the expert in the issuer after the transaction will be …………………. (percentage) of the total shares in issue. This shareholding neither makes the expert a material shareholder of the issuer nor is the shareholding material to the expert in the context of the expert’s investments as reflected in the expert’s balance sheet; or

(d) the fees for providing the fairness opinion are to be received in cash, and are in no way linked to the ability to convert those fees into shares.

10. General

(a) The expert will inform the LuSE immediately of any changes to the information given in this declaration that comes to the attention of the expert between the date of this declaration and the date of issue of the fairness opinion; and

(b) the contents of this declaration have been discussed with the compliance officer of the expert and all other relevant directors and employees of the expert who maintain the information provided in terms of this declaration; and

(c) based on the fact that the expert has made all reasonable enquiries in order to complete this declaration, the information disclosed in this declaration is accurate and complete.

SIGNED BY ……………………………………………………………… [insert full names]

For and on behalf of

……………………….

[insert name of expert]

Schedule 5B

Expert’s declaration of competency

To: The Listings Committee,
LuSE
Central Park
Cairo Road
LUSAKA
20

Full name of the independent professional expert: ……………………………………………………..
………………………………………………………………………………………………………… (“the expert”)
I, ………………………………………………………………………………………………. [insert full names] being a ………………………………………….. [insert relationship to expert e.g. director/partner] and duly authorised on behalf of the expert to give this declaration, declare as follows:

1. I understand that an independent fairness opinion is required in terms of section ……………………………………………………. of the Listings Requirements of the LuSE Limited (“the LuSE”) with regard to …………………………………………………. [insert brief description of the transaction] (“the transaction”).

2. The expert has been briefed by …………………………………………………….., who is a …………………………………………….. [insert position e.g. director] of the issuer, and ……………………………………. [insert name of company] who is the issuer’s advisor on the transaction, as to the nature of this assignment.

3. The directors, partners, officers and employees (“staff”) of the expert allocated to this assignment have the necessary qualifications and expertise, as detailed below:

Name (Note 1) Responsibility
on assignment
Professional
Qualifications
Abridged experience
in similar assignments
(including years’ experience)

(Note 1: The details of at least 2 people included in the team preparing the independent opinion must be provided. In addition, the details of one individual responsible for the independent review process discussed in 5 below must also be provided)

4. (a) The expert has all the necessary competencies to carry out this assignment (as detailed in 3 above); or (b) the expert does not have all the necessary competencies to complete this assignment, and has engaged or will engage ………………………………… . (“the third party”) to assist with the assignment. The third party has completed schedule 5A and has the necessary qualifications and expertise, as detailed
below. [delete whichever of (a) or (b) is not applicable]

5. An internal review and quality control process exists at the expert that will ensure that someone other than the senior person responsible for the assignment reviews the final opinion. That quality control process involves the following ………………………………… (full details to be included) or is identical to the detailed procedures spelt out in Schedule 5B declaration submitted to the LuSE on ……………………………. , a copy of which is included.

6. The issuer has undertaken that it will provide the expert with all the information that we have requested or may need to request in order to prepare the fairness opinion.

7. The expert will undertake a proper evaluation of all information provided to us by the management and directors of the issuer.

8. The expert will inform the LuSE Listings Committee of any changes to the information given in this declaration between the date of this declaration and the date of issue of the fairness opinion.

SIGNED BY ……………………………………………………………………………….. [insert full names]

For and on behalf of

……………..

[insert name of expert]

Schedule 5C

Declaration by the issuer

[please delete any paragraphs which are not applicable and which are the subject of a matter choice between paragraphs]

To: The Listings Committee,
LuSE
Central Park
Cairo Road
LUSAKA
20

Full name of the issuer:
I, ……………………………. [insert full names], being a ……………………….. [insert relationship to issuer e.g. director] and duly authorised on behalf of the issuer to give this declaration, declare as follows:

1. I understand that an independent fairness opinion is required in terms of section ………………………………. . of the Listings Requirements of the LuSE (“the LuSE”) with regard to ………………………………………………. [insert brief description of the
transaction] (“the transaction”).

2. I have briefed ………………………………………………….. [insert name of expert] (“the expert”), on the transaction and as to the nature of this assignment;

3. Due to their involvement in the transaction, ………………………………………………… (please insert the names of any directors of the issuer who could have a conflict of interest), are not in any way involved in the process of obtaining the independent fairness opinion.

4. The issuer has provided the expert with all the information requested that is relevant for the purpose of issuing the fairness opinion on the transaction, and will continue to provide all such further information as the expert may request.

5. The issuer did not approach the independent professional expert in order to agree a price at which the independent professional expert would find the transaction fair.

6. (a) The issuer approached the following parties formally, or informally, with a view to their possibly issuing the fairness opinion, but this was not done in order to find the most favourable view from a number of potential independent professional experts. Rather, we did/did not retain their services for the reasons given below:

Name of firm approached
and contact details
Reason for appointing/
not appointing them

or
(b) the expert was the only party approached with a view to obtaining a fairness opinion in relation to the transaction; and

(c) all parties approached were required to sign confidentiality agreements which bind them until such time as the transaction is announced and also in the event that the transaction does not proceed and is thus not announced.

7. The issuer believes that the expert is sufficiently independent and has the necessary competency to execute this assignment.

8. The issuer will inform the Listings Committee of any changes to the information given in this declaration between the date of this declaration and the date that the fairness opinion is issued.

9. The issuer consents to the LuSE contacting the parties set out in 5 above and waives, in favour of the LuSE, its right to confidentiality in respect of its dealings with such parties, in order for the LuSE to verify the reasons for the appointment or non-appointment of such parties.

10. In the instance where the expert is the auditor of the issuer, we confirm that the appointment has been approved by the audit committee (and attach a copy of this approval).

SIGNED BY ……………………………………………………………………………….. [insert full names]

For and on behalf of
………………..

[insert name of issuer]

Full name of the issuer’s sponsoring broker:

I, ………………………….. [insert full names], being a ………………………. [insert relationship to sponsoring broker e.g. director] and duly authorised on behalf of the sponsoring broker to give this declaration, declare that the sponsoring broker:

(a) has ensured that the issuer understands the declaration that they have signed;

(b) has made sufficient enquires to ensure that this declaration has been completed accurately by the issuer and after due consideration;

(c) has ensured that the issuer and the expert have received a full explanation of what is expected from them with regard to the issue of a fairness opinion; and

(d) has undertaken to inform the LuSE immediately if it becomes aware that any information given by the issuer or the expert in the Schedules 5A, 5B and 5C has changed between the date of this declaration and the date of issue of the fairness opinion.

SIGNED BY ……………………………………………………………………………….. [insert full names]

For and on behalf of
……………….

[insert name of sponsoring broker]

Schedule 6

Application for a listing of securities resulting from an issue for cash

6.1 The application for a listing of securities resulting from an issue for cash must state:

(a) the number of securities for which a listing is applied;

(b) the date from which the listing is to commence;

(c) that the securities rank pari passu with the other issued securities of the applicant;

(d) the date on which the securities are to be allotted;

(e) the date on which the securities are to be issued;

(f) the authorised and issued capital of the applicant prior to the issue of the securities;

(g) the authorised and issued capital after the issue of the securities;

(h) the number of public shareholders in the applicant, and the number and percentage of each class of security held by them;

(i) the level of voting required at the general meeting required by the Listings Requirements to approve the issue for cash;

(j) when the securities holders approved or will approve the issue;

(k) details of all issues of securities during the current financial year;

(l) that the issue will be to public shareholders; and

(m) what discount or premium, if any, the securities are to be issued at.

6.2 Where applicable, the application must be accompanied by a fairness opinion on the issue from an independent professional expert acceptable to the LuSE.

6.3 The application must be signed by the secretary and a director, or equivalent, of the applicant and by the sponsoring broker.

6.4 The application must be accompanied by a resolution of the directors, or equivalent, of the applicant authorising the application for listing together with the relevant listing fee.

6.5 The application must be accompanied by the relevant agreements.

Schedule 7

General undertaking

The following provisions must be contained in the general undertaking by the applicant issuer, which must be in the form of a resolution of directors certified by the Chairman:

7.1 That the applicant will make no charge in Zambia for a transfer of securities or the splitting of certificates of title.

7.2 That the applicant will make no charge in the Republic of Zambia for the registration of any powers of attorney or letters of administration.

7.3 That the articles of association of the applicant issuer and its subsidiary companies comply with the Listings Requirements that are now or hereafter may be in force.

7.4 That:

(a) all the said securities, or in the case of these being more than one class of share, all the securities of each respective class, are, and will remain, identical in all respects, viz.:

(i) they are of the same nominal value and are all fully paid;

(ii) they carry the same rights as to unrestricted transfer, attendance and voting at general/annual general meetings and in all other respects;
and

(iii) they are entitled to dividends at the same rate and for the same period, so that on the next ensuing distribution the dividend payable
on each share will be the same amount;

(b) before taking any action which, for statutory or other reasons would require the reinstatement of distinguishing numbers of the said securities or would or might cause difficulty or doubts in distinguishing between securities for which a listing has been granted and other securities in the capital of the applicant issuer, formal notice will be given to the LuSE of the intended action with full particulars of all relevant facts; and

(c) the applicant issuer will accept for registration transfer deeds and certificates.

Schedule 8

Compliance declaration

A sworn declaration must be made by the chairman and secretary stating, to the best of their knowledge, judgement and belief, arrived at after due and careful enquiry, where applicable, the following particulars:

8.1 That all documents required by the Act and any other written law have been duly filed with the Registrar of Companies, and that all legal requirements have been fulfilled.

8.2 That the minimum subscription has been received if the issue was not fully underwritten.

8.3 The number of securities, or amount of stock or debentures applied for by the public.

8.4 The number of securities issued for cash to the public, stating the price of issue and the actual amount per share paid thereon in cash.

8.5 The number of securities allotted for a consideration other than cash.

8.6 That the certificates, or other documents in which it is desired to deal have been or are ready to be delivered, and that they are identical to the specimen approved by the LuSE.

8.7 That, where applicable, the purchase of any assets has been completed, their transfer registered in the name of the applicant issuer and the purchase consideration was paid subsequent to registration of transfer. Where any such purchase has not been completed or registered, an undertaking that completion will be conditional upon registration.

8.8 That all monies refundable, in respect of any application or where no allotment has been made, have been refunded to applicants.

8.9 That external companies will open and maintain a transfer office in the Republic of Zambia during the period the securities are listed on the LuSE.

8.10 That all documents specified in paragraph 7.G.1 have been or are lying open for inspection in the manner prescribed.

8.11 That there are no other circumstances arising from the application that should be disclosed to the LuSE.

Schedule 9

Mechanical or electronic signatures on certificates of title

An application for mechanical or electronic signatures on certificates of title must be made in the following form:

“The Listings Committee
LuSE
Central Park
Cairo Road
LUSAKA

Dear Sirs

MECHANICAL/ELECTRONIC SIGNATURES (delete whichever is not applicable)

The Board undertakes that no mechanical/electronic (delete whichever is not applicable) signatures will be affixed to certificates issued in respect of the securities/stock of the applicant issuer unless the following conditions are complied with:

(a) The means of affixing such signatures shall be by (here insert the method to be employed); and

(b) Suitable blocks or dies/electronic templates (delete whichever is not applicable) bearing, respectively, the signatures of the relevant directors and, of the secretary or transfer secretary, shall be procured at the cost of the applicant issuer and kept respectively in the custody or under the control of the persons whose signatures they bear, or their duly authorised representatives, and in whose presence and by whose authority alone they shall be used. Each of such persons shall on each occasion on which such authority is given by him, record in a register to be maintained for this purpose by the secretary, the granting of such authority, its purpose and extent.

A certified copy of the resolution of the Board, adopting this procedure for mechanical/electronic (delete whichever is not applicable) signatures, is enclosed.

Yours faithfully,
(signature)

Chairman
………………

Schedule 10

Requirements for articles of association

No application for listing will be considered until the articles of association, or other document constituting or defining the constitution of the applicant, (“the articles”) has been approved by the LuSE.

The articles must be in English and must comply with the requirements in this schedule in respect of an applicant and the applicant’s subsidiary companies.

The requirements laid down are not exhaustive. The LuSE will not allow articles to contain any provisions that are unlawful or otherwise conflict with the Listings Requrements, may in any way restrict free dealings in securities or may, in the LuSE’s opinion, be unreasonable.

Contents of articles for applicants

The following provisions must be included in the contents of articles of applicants:

Preference securities

10.1 If there are cumulative and/or non cumulative preference shares in the capital of the company, the following right must attach to such shares:

“No further securities ranking in priority to, or pari passu with, existing preference shares, of any class, shall be created or issued without the consent in writing of the holders of 75% of the existing preference shares of such class, or the sanction of a resolution of the holders of such class of preference shares, passed at a separate general meeting of such holders, at which preference shareholders holding in aggregate not less than 1/4 of the total votes of all the preference shareholders holding securities in that class entitled to vote at that meeting, are present in person or by proxy, and the resolution has been passed by not less than 3/4 of the total votes to which the members of that class, present in person or by proxy, are entitled.”

Unissued securities

10.2 Provision must be made in the articles that unissued equity securities shall be offered to existing shareholders pro rata to their shareholding and in accordance with the Act and the Companies Act. However, subject to the provisions of the Act, the articles may provide that shareholders in general meeting may authorise the directors to issue unissued securities and/or grant options to subscribe for unissued securities as the directors in their discretion think fit, provided that such transaction(s) has/have been approved by the LuSE.

Calls on securities – external company

10.4 Neither the directors nor the company are to be given power over the issue of securities to create any differences in rights between the holders of the same class of share in respect of the amount of calls to be paid and the time of payment of such calls or in any other respect whatsoever.

10.5 Any amount paid up in advance of calls on any share shall carry interest only and shall not entitle the holder of the share to participate in respect thereof in a dividend subsequently declared.

10.6 Provision should be made in the articles of an external company for the payment of calls at the branch office in the Republic of Zambia.

Lien upon securities

10.7 The articles must not give a company power to claim a lien on securities.

Transfer of securities

10.8 Provision must be contained in the articles for the use of the common form of transfer.

10.9 There must be no restriction on the transfer of securities.

10.10 The following provision must be made in the articles:

“Any instrument of transfer (if any) shall be left at the transfer office of the company at which it is presented for registration, accompanied by the certificate of the securities to be transferred, and or such other evidence as the company may require to prove the title of the transferor or his rights to transfer the securities. All authorities to sign transfer deeds granted by members for the purpose of transferring securities that may be lodged, produced or exhibited with or to the company at any of its proper offices shall as between the company and the grantor of such authorities, be taken and deemed to continue and remain in full force and effect, and the company may allow the same to be acted upon until such time as express notice in writing of the revocation of the same shall have been given and lodged at the company’s transfer offices at which the authority was lodged, produced or exhibited. Even after the giving and lodging of such notices the company shall be entitled to give effect to any instruments signed under the authority to sign, and certified by any officer of the company, as being in order before the giving and lodging of such notice.”

Transmission clause

10.11 A provision to the effect that securities registered in the name of a deceased or insolvent shareholder shall be forfeited if the executor fails to register them in his own name or in the name of the heir(s) or legatees, when called upon by the directors to do so, will not be permitted.

Share warrants to bearer

10.12 Provision must be made for the issue of a new share warrant in place of one lost provided suitable documentation evidencing ownership is provided to the satisfaction of the directors.

10.13 Where the memorandum prohibits the issue of share warrants and the articles make provision for the issue thereof, the following clause must be inserted in the articles.

“Notwithstanding the provisions contained in these articles with reference to the issue of share warrants, the company is prohibited from issuing share warrants unless and until the objects of the company are altered to permit the issue of share warrants.”

Commission

10.14 The articles must provide that, subject to the Act and the Companies Act, the company may not pay commission exceeding 10% to any person in consideration for their subscribing or agreeing to subscribe, whether absolutely or conditionally, for any securities of the company.

Capital

10.15 Power should be contained in the articles to effect the following:

(a) increase(s) of capital;

(b) consolidation of securities;

(c) conversion of securities into stock;

(d) sub-division of securities;

(e) repurchase of securities;

(f) cancellation of securities;

(g) payments to shareholders;

(h) conversion of ordinary shares into redeemable preference shares; and

(i) conversion of securities of any class into securities of any other class, whether issued or not.

10.17 The clause in the articles dealing with the payments to shareholders must not provide that capital shall be repaid upon the basis that it may be called up again.

Notice of meeting

10.18 In the articles of an external company, provision must be made that if notice of a general/annual general meeting is given by surface mail, and is sent from the registered office of the company, at least 30 days notice of such meeting must be given to all shareholders entitled to such notice, or, at least 21 days notice must be given if the notice is sent by surface mail from a branch office in the Republic or by air mail from the registered office of the company.

10.19 In the articles of all companies, provision must be made for sending notices of meetings to the LuSE at the same time as notices are sent to shareholders.

General meetings

10.20 The business of a general meeting must include power to sanction or declare dividends.

10.21 The quorum at a general meeting must be at least three members entitled to attend and vote.

Voting at general meetings

10.22 In the case of an external company, the articles must make provision for depositing proxies at the branch office in the Republic of Zambia.

Directors

10.23 The articles must provide that the minimum number of directors shall be four.

10.24 The articles must provide that the appointment of a director to fill a casual vacancy or as an addition to the board must be confirmed at the next annual general meeting.

10.25 The articles must provide that if the number of directors falls below the minimum provided in the articles, the remaining directors shall only be permitted to act for the purpose of filling vacancies or calling general meetings of shareholders.

10.26 The articles must contain a provision that a director may be employed in any other capacity in the company or as a director or employee of a company controlled by, or itself a subsidiary of, this company and that in this event, their appointment and remuneration in respect of such other office must be determined by a disinterested quorum of directors.

10.27 The articles must provide that the directors shall be paid all their travelling and other expenses properly and necessarily incurred by them in and about the business of the company, and in attending meetings of the directors or of committees thereof; and that if any director is required to perform extra services or to go to reside abroad or otherwise shall be specifically occupied about the company’s business, they shall be entitled to receive such remuneration as is determined by a disinterested quorum of directors, which may be either in addition to or in substitution for any other remuneration.

10.28 In a new company, all the directors are to retire at the first annual general meeting, and at each annual general meeting of the company thereafter one third of the directors, or if their number is not a multiple of three, then the number nearest to but not less than one-third, shall retire from office. In the case of an existing company, at least one third of the directors shall retire at each annual general meeting. The aforesaid provisions are however, subject to the proviso that if a director is appointed a managing director, or as an employee of the company in any other capacity, the contract under which he is appointed may provide that he shall not, while he continues to hold that position or office under contract for a term of rotation, be subject to retirement by such contract and he shall not in such case be taken into account in determining the rotation or retirement of directors, provided that less than half of the directors may be appointed to any such position.

10.29 The period to be allowed before the date of an annual general meeting for the nomination of a new director must be such as to give sufficient time after the receipt of the notice for nominations to reach the company’s office from any part of the Republic of Zambia.

10.30 The directors shall be entitled to elect a chairman, deputy chairman and/or any vice chairmen and determine the period for which they, respectively, shall hold office.

If the quorum of directors is two, the chairman shall not be permitted to have a casting vote if only two directors are present at a meeting of directors.

10.31 A resolution signed, in the Republic of Zambia, by all directors (or their alternates, if applicable), which resolution is then inserted in the minute book, shall be as valid and effective as if it had been passed at a meeting of directors. Any such resolution may consist of several documents and shall be deemed to have been passed on the date on which it was signed by the last director who signed it (unless a statement to the contrary is made in that resolution).

Dividends

10.32 The articles must provide that the company in general meeting or the directors may declare dividends. However, the company in general meeting must not be able to declare a larger dividend than that recommended by the directors.

10.33 It should be noted that dividends are to be payable to shareholders registered as at a date subsequent to the date of declaration or date of confirmation of the dividend whichever is the later.

10.34 A provision to the effect that dividends that remain unclaimed for 3 years may become the property of the company will be permitted. Subject to any law in force, the company must hold monies other than dividends due to shareholders in trust indefinitely until lawfully claimed by the shareholders.

Annual financial statements

10.36 Provision should be made in the articles of a company incorporated in the Republic of Zambia for a copy of the annual financial statements to be sent to shareholders at least 21 days before the date of the annual general meeting at which they will be considered.

10.37 In the articles of an external company, provision should be made that a copy of the annual financial statements will be sent to all shareholders at least 30 days before the date of the annual general meeting at which they will be considered if sent by surface mail from the registered office of the company, and at least 21 days before that date if sent by surface mail from a branch office in the Republic of Zambia or by airmail from the registered office.

Notices of general/annual general meetings

10.38 Notices of general/annual general meetings are to be sent to each person entitled to vote at such meeting.

Members registered address

10.39 A clause in the articles to the effect that members shall register an address in the Republic of Zambia or in some other country will be permitted.

10.40 In the articles of an external company, a provision that members are to register an address in the foreign country only will not be permitted.

Advertisement of notices

10.41 In addition to the notice of general/annual general meetings to be sent to all beneficial owners, a provision must be included in the articles that such notice must also be announced through SENS.

Schedule 11

Requirements for certificates of title

With respect to the certificated environment, the following are the requirements for certificates of title:

Size
11.1 Minimum and maximum sizes of certificates of title:

(a) the breadth permitted is a minimum of 250 mm and a maximum of 300 mm; and

(b) the depth permitted is a minimum of 200 mm and a maximum of 275 mm.

Name
11.2 The name of the company must be clearly printed in bold type. The name must agree in every particular with that under which the company was registered.

Abbreviations of words should not be used unless the name of the company is so registered, e.g. the word “AND”/“and” should be printed, and not the abbreviation “&” and the word “LIMITED”/“Limited” should be printed and not the abbreviation “LTD”/“Ltd”. Should the company be registered with either of these words abbreviated a note should be printed at the foot of the certificate of title to the effect that certificates of title accompanied by transfer deeds having the name of the company abbreviated “&” or the word “and” written in full will be accepted for transfer. A similar procedure should be adopted for any other abbreviations.

Change of name
11.3 The former name of the company must be shown in brackets under the new name of the company for a period of at least one year after such change of name.

Country of registration
11.4 The country of registration must be printed under the name of the company.

Translation of name
11.5 Should it be desired to show the translation of the name in another official language this may be shown under the name, provided a statement is made on the certificate that the company will accept either name on transfer deeds.

Certificate number
11.6 The certificate of title number must be shown on the top left-hand corner.

Number of securities
11.7 The number of securities represented by the certificate must be shown on the top right-hand corner. In the case of units of stock the number of units and the nominal value must be shown.

LuSE alpha code
11.8 All certificates of title must bear the LuSE alpha code. This alpha code should be clearly printed in block capital letters on the top right-hand corner of the certificate of title. Any additional identification codes that may be introduced by the LuSE in accordance with international standards must be similarly printed on certificates of title. Whenever share certificates are recalled the ISIN will change.

Preference share certificates
11.9 Certificates in respect of a first issue of preference shares must be printed in red, including the border, if any. Certificates in respect of shares, other than a first issue of preference shares, may be printed in any other approved colour. Where preference shares of a new class are issued, second and subsequent issues of preference shares should be described as “Second Preference Shares”, “Third Preference Shares” and so on.

Description of securities
11.10 A full description of the class of securities, must be printed in the body of the certificate; the description to be in accordance with that prescribed in the memorandum and articles of association. Where special rights and obligations pertain to the securities (e.g. for preference shares and/or debentures), salient details of these rights and conditions must be printed on the back of the certificate.

Class of securities
11.11 A description of the class of securities must be printed in bold type above the name of the company.

Low and high voting equity shares
11.12 Certificates in respect of low or high voting equity shares that have been issued should indicate clearly that the shares are low or high voting equity shares, such as “A” or “N” ordinary shares.

Certificates of title to indicate re-construction
11.13 Where securities have been split, reduced, and/or consolidated, a summary of this information must be clearly shown at the top of the certificate. This information must be perpetuated on such certificates of title for a period of one year. These securities must be clearly distinguishable from other securities of the company in circulation. As an additional safeguard, companies must use a different colour and series of numbers.

Address of registered office and transfer office
11.14 The physical and postal addresses in the Republic of Zambia of the registered office and transfer office of the company must be shown.

Signatures on certificates of title
11.15 The provisions of the Companies Act shall constitute the LuSE’s requirements for the signatures on certificates of title.

11.16 The date and place of issue of the certificate must be stated.

Certificates cancelled by mutilation
11.17 Specimens submitted must be cancelled by mutilation (a rubber stamp, or statement in ink to the effect that the certificate has been cancelled, is not sufficient).

Specimens retained
11.18 Specimen certificates of title submitted will be retained and will not be returned.

Schedule 12

Requirements for option certificates in respect of listed options

The conditions of issue of listed options must be printed on option certificates and must make provision for the following:

12.1 The option exercise period:

(a) the minimum period during which an option may be exercised shall be not less than one calendar month (“option exercise period”). The company
must advise option holders at least six weeks prior to the option exercise period of the dates of the option exercise period; and

(b) in cases where the options may be exercised at any time, the company shall undertake to send a reminder to registered option holders not less than six weeks or more than two months prior to the final date for the exercise of the options.

12.2 Upon exercise of the option, the securities to be issued and allotted by the company in satisfaction of the option shall rank pari passu with existing issued securities of the same class in the capital of the company, and certificates of title in satisfaction of such rights will be issued in accordance with the relevant timetable in Schedule 24.

12.3 New option certificates shall be issued upon transfer to a transferee.

12.4 In cases where the exercise of the option is restricted to an option exercise period, the company shall undertake not to fix a DD or LDT for a dividend, rights offer, capitalisation issue, capital reconstruction or take over offer to be settled by an issue of ordinary shares, that will fall within the exercise period.

Where the options may be exercised at any time, holders of the options shall be precluded from exercising their options between the DD and LDT of any corporate event.

12.5 The number, description and nominal value of the securities over which the option is granted.

12.6 The price at which the option may be exercised.

12.7 That the option over a specified number of securities will be exercisable either in whole or in part.

12.8 Additional issues of options or of the issue of securities with conversion rights or of the amendment of the conditions of the options will require the separate sanction of the holders of the options and the holders of each class of equity security.

12.9 The holders of the options shall be advised simultaneously with the holders of equity shares or stock of any contemplated rights, claw-back or renounceable offer, or capitalisation/bonus issue, and of all relevant dates affecting entitlement ratios and participation in such offer or issue, in accordance with the relevant timetable in Schedule 24.

12.10 In a capital reconstruction, the ratio of:

(a) the total number of securities that may be issued on the exercise of the option compared to the total number of securities issued; and

(b) the issue price per ordinary share or stock compared to the nominal value per share or stock; shall be adjusted to correspond proportionately to the total number of securities or stock issued and the nominal value per share or stock in the reconstructed capital.

12.11 Ordinary share capital shall not be repaid during the period of the option.

Schedule 13

Rescue operations

13.1 A listed company in severe financial difficulty may find itself with no alternative but to dispose of a substantial part of its business or issue shares for cash within a short time frame to meet its ongoing working capital requirements or to reduce its liabilities. Due to time constraints it may not be able to prepare a circular and convene a general meeting to obtain prior shareholder approval.

13.2 The LuSE may modify the requirements in paragraph 9.20 to 9.29 and 5.51 to 5.53 regarding the preparation of a circular and the obtaining of shareholder approval, if the company:

(a) can demonstrate that it is in severe financial difficulty; and

(b) satisfies the conditions in this schedule.

13.3 An application for dispensation should be made to the LuSE at the earliest available opportunity and at least ten business days before the terms of the disposal or issue of shares for cash are agreed.

13.4 The issuer should be able to demonstrate to the LuSE that it could not reasonably have entered into negotiations earlier to enable shareholder approval to be sought.

13.5 The following documents should be provided to the LuSE:

(a) confirmation from the board of directors of the issuer that:

(i) negotiation does not allow time for shareholder approval;

(ii) all alternative methods of financing have been exhausted and the only option remaining is to dispose of a substantial part of its business or issue shares for cash;

(iii) by taking the decision to dispose of part of the business or to issue shares to raise cash, the directors are acting in the best interests of the company and shareholders as a whole and that unless it is completed judicial managers or liquidators are likely to be appointed; and

(iv) if the disposal or issue of shares for cash is to a related party, that it is the only available option in the current circumstances;

(b) confirmation from the issuer’s sponsoring broker that, in its opinion and on the basis of information available to it, the issuer is in severe financial difficulty and that it will not be in a position to meet its obligations as they fall due unless the disposal or issue of shares for cash takes place according to the proposed timetable;

(c) confirmation from the persons providing finance stating that further finance or facilities will not be made available and that unless the disposal or issue of shares for cash is effected immediately, current facilities will be withdrawn;

(d) confirmation that the Commission has been consulted; and

(e) an announcement that complies with paragraph 13.6 below.

13.6 An announcement, requiring LuSE approval, must be released over SENS by no later than the date the terms of the disposal or issue of shares for cash are agreed and this announcement should contain:

(a) all relevant information required in terms of paragraph 9.15 or 11.22;

(b) the name of the acquirer and the expected date of completion of the disposal or the name of the party subscribing for the shares;

(c) full disclosure about the group’s continuing prospects for at least the current financial year;

(d) a statement that the directors not only believe that the disposal or issue of share for cash is in the best interests of the company and shareholders as a whole but that if it is not completed the company may be unable to meet its financial commitments as they fall due and consequently will be unable to continue to trade resulting in the appointment of judicial managers or liquidators;

(e) a statement incorporating the details of all the confirmations provided to the LuSE in terms of 13.5 above;

(f) details of any financing arrangements (either current or future) if they are contingent upon the disposal being effected;

(g) if the disposal or issue for cash is to a related party, then a statement by the board whether the transaction is fair in so far as shareholders are concerned and confirmation that they have been so advised by an independent expert; and

(h) a statement by the issuer that in its opinion the working capital available to the continuing group is sufficient for the group’s present requirements, that is, for at least 12 months from the date of the announcement, or, if not, how it is proposed to provide the additional working capital thought by the company to be necessary.

Schedule 14

Requirements for share incentive schemes

Share options schemes and share incentive schemes (“schemes”) are to be used to incentivise staff and may not be used for trading purposes. The following provisions apply, with appropriate modifications, to all schemes involving the purchase of securities, and/or the issue of shares or other securities (including options) by issuers (or trusts formed for this purpose in terms of the law in force) to, or for the benefit of, employees.

They apply also to schemes of all subsidiaries of issuers.

The LuSE must be consulted on the application of these provisions to schemes intended to apply to employees of associates.

14.1 The scheme, which must be approved by shareholders of the issuer or company applying for listing in general meeting prior to its implementation, must contain provisions relating to:

(a) the category of persons to whom or for the benefit of whom securities may be purchased or issued under the scheme (“participants”).

Notwithstanding
the above requirement, the LuSE restricts the definition of participants to persons involved in the business of the group including non-executive
directors;

(b) the aggregate number of securities that may be utilised for purposes of the scheme must be stated together with the percentage of the issued share capital that it represents at that time;

(c) a fixed maximum percentage for any one participant;

(d) the amount, if any, payable on application or acceptance; the basis for determining the purchase, subscription or option price, which must be a fixed mechanism for all participants; the period in which payments, or loans to provide the same, may be paid or after which payments or loans to provide the same, must be paid; the terms of any loan; the procedure to be adopted on termination of employment or retirement of a participant; and

(e) the voting, dividend, transfer and other rights, including those arising on a liquidation of the company, attaching to the securities and to any options (if appropriate).

14.2 A scheme may provide, in the event of a capitalisation issue, a rights issue, subdivision, consolidation of securities or reduction of capital, for adjustment of the purchase, subscription or option price or the number or amount of securities subject to options already granted to participants and to the scheme. Such adjustments should give a participant entitlement to the same proportion of the equity capital as that to which he was previously entitled:

(a) the issue of securities as consideration for an acquisition or a waiver of preemptive rights will not be regarded as a circumstance requiring adjustment; and

(b) adjustments, where necessary must be confirmed to the directors in writing by the company’s auditors that these are calculated on a reasonable basis.

14.3 The scheme must provide, or the circular must state, that the provisions relating to the matters contained in 14.1 above cannot be altered without the prior approval of shareholders in general meeting.

14.4 Executive directors may not be appointed as trustees of schemes. Non-executive directors may be appointed as trustees of the scheme, provided they do not benefit from the scheme.

14.5 The trustees may not be participants under the scheme.

14.6 Shares shall, upon release to participants, rank pari passu in all respects with the existing issued shares of the company.

14.7 Application must be made for a listing of those securities of a class already listed at the time of their issue.

14.8 The scheme document, if not circulated to the shareholders, must be available for inspection for at least 14 days at the company’s registered office or such other places as the LuSE may agree.

14.9 The terms of the resolution must approve a specific scheme and refer either to the scheme itself (if circulated to the shareholders) or to a summary of its principal terms included in the circular, which must contain all the provisions set out in paragraph 14.1 above.

14.10 The issuer must, in respect of its or its subsidiary companies schemes, summarise in its annual financial statements the number of securities that may be utilised for purposes of the scheme at the beginning of the accounting period, changes in such number during the accounting period and the balance of securities available for utilisation for purposes of the scheme at the end of the accounting period.

14.11 Shares held by the issuer’s share trust, shall not exceed 20% of the company’s issued share capital, unless under exceptional circumstances.

14.12 With regards to the trading of shares by schemes, the following requirements apply:

(a) shares may only be purchased once a participant or group of participants to whom they will be allocated, has been formally identified (e.g. applicants to whom options over securities have been issued);

(b) shares may only be sold:

(i) once that participant has resigned or is deceased; or

(ii) on behalf of the employee, once the rights have vested in the employee; or

(iii) to reduce the pool of unallocated shares held as at 1 September 2003.

14.13 Shares held by a share trust or scheme will not have their votes at general/annual general meetings taken account of for Listing Requirements resolution approval purposes. Such shares will also not be allowed to be taken account of for purposes of determining categorisations as detailed in Section 9.

Schedule 16

Sponsoring Brokers

This schedule contains certain Listings Requirements applicable to sponsoring brokers and should be read with Section 2.

Introduction
16.1 This schedule sets out the Listings Requirements of the LuSE pertaining to the eligibility criteria of sponsoring brokers.

16.2 A sponsoring broker may be a company with sufficient executive staff to execute all sponsoring broker requirements and responsibilities in accordance with the Listings Requirements.

16.3 The responsibilities of a sponsoring broker are set out in Section 2 and the Act.

Schedule 17

Declaration by Sponsoring Broker

The following declaration format must be used by sponsoring brokers when submitting
the declaration on their letterhead to the LuSE:
“The Listings Committee
LuSE
Central Park
Cairo Road
LUSAKA
……………….. 20 ………..
Dear Sirs
(Full name of sponsoring broker) – sponsoring broker declaration The attached application by (full name of applicant issuer) in respect of (brief
description of the corporate action) is the subject of this sponsoring broker declaration.

I, (full name of approved executive), an approved executive of the above sponsoring broker:

(a) hereby confirm that I have satisfied myself