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Scrip Dividend
Metrofile Holdings Limited
(Incorporated in the Republic of South Africa)
(Registration number 1983/012697/06)
Share code: MFL
ISIN: ZAE000061727
("Metrofile" or the “Company”)
SCRIP DIVIDEND
Shareholders of Metrofile are referred to the Company’s results
for the year ended 30 June 2019 published on the Stock Exchange
News Service (“SENS”) on Thursday, 5 September 2019 and in the
press on Friday, 6 September 2019, wherein the board of
directors of Metrofile (“Board”) informed shareholders that it
had resolved to declare a distribution of fully-paid Metrofile
ordinary shares with a par value of 0.6146 cent each (“Ordinary
Shares”) (the “Scrip Distribution”).
The Scrip Dividend will be to ordinary shareholders
(“Shareholders”) recorded in the securities register of the
Company at the close of business on Friday, 11 October 2019
(“Record Date”). Shareholders will, however, be entitled to
elect to receive a gross cash dividend of 5 cents per Metrofile
Ordinary Share held on the Record Date, in respect of all or
part of their ordinary shareholding, instead of the Scrip
Distribution (the “Cash Dividend”).
The Cash Dividend will, unless exempt, be subject to Dividend
Withholding Tax (“DWT”). South African resident Shareholders who
are liable for DWT will be subject to DWT at a rate of 20% of
the Cash Dividend; to be withheld from the Cash Dividend with
the result that Shareholders will receive a net amount of 4
cents per share.
The Cash Dividend will be paid only to those:
• certificated Shareholders whose forms of election (“Form of
Election”) to receive the Cash Dividend, in respect of all
or part of their shareholding, are received by the Transfer
Secretaries on or before 12:00 on the Record Date; and
• dematerialised Shareholders who have instructed their
Central Securities Depository Participant (”CSDP”) or broker
accordingly and in the manner and time stipulated in their
agreement with such CSDP or broker.
Shareholders not electing to receive the Cash Dividend in respect
of all or part of their ordinary shareholding will, without any
action on their part, be entitled to receive the Scrip
Distribution in proportion to their ordinary shareholding as at
the close of business on the Record Date and, in accordance
with the ratio set out in the circular and Form of Election to
be distributed to shareholders on or about Monday,
23 September 2019 (“Circular”).
The number of Scrip Distribution shares to which each
Shareholder will become entitled pursuant to the Scrip
Distribution (to the extent that such Shareholders have not
elected to receive the Cash Dividend) will be determined by
reference to such Shareholder’s ordinary shareholding in
Metrofile (at the close of business on the Record Date) in
relation to the ratio that 5 cents bears to the Volume Weighted
Average Price (“VWAP”) of Metrofile Ordinary Shares traded on
the JSE during the 10-day trading period on Tuesday,
1 October 2019, provided that, where the application of this
ratio gives rise to a fraction of an Ordinary Share, the
fraction will be rounded down and settled in cash at the VWAP of
Metrofile Ordinary Shares on Wednesday, 9 October 2019 (being
the day on which the Ordinary Shares begin trading “ex” the
entitlement to receive the Scrip Distribution or the Cash
Dividend alternative), less 10%, in accordance with the JSE
Listings Requirements.
Example of Scrip Distribution entitlement:
This example assumes that a Shareholder holds 100 Metrofile
Ordinary Shares at the close of business on the Record Date and
does not elect to receive the Cash Dividend alternative for all
or part of such Metrofile Ordinary Shares, and that the VWAP of
Metrofile Ordinary Shares traded on the JSE for the 10-day
trading period ending Tuesday, 1 October 2019 is 145 cents per
ordinary share. Shareholders are referred to the paragraph
headed Tax Implications for details regarding DWT.
New ordinary share entitlement = 100 x 5 cents
145 cents
= 3.44828 Scrip Distribution shares per 100 Metrofile
Ordinary Shares held, subject to the rounding
principles described a b o v e . This would result in a
shareholder with 100 shares receiving a new ordinary
share entitlement of 3 Scrip Distribution shares and a
cash payment for the fraction.
The Cash Dividend will be paid out of the Company’s
distributable retained profits while the issue price of the
Scrip Distribution (which will equal the VWAP of Metrofile
Ordinary Shares traded on the JSE for the 10-day trading period
ending on Tuesday, 1 October 2019) will be settled by way of
capitalisation of the Company’s distributable retained profits.
The Scrip Distribution shares will, upon their issue, rank pari
passu in all respects with the other ordinary Metrofile shares
of 0.6146 cent each then in issue.
RATIONALE
The Board believes that a Scrip Distribution, with the election
to receive the Cash Dividend, allows Metrofile the opportunity
to conserve cash to support its ongoing growth initiatives and
Shareholders a chance to reinvest whilst still affording
Shareholders a choice to receive the Cash Dividend, if
preferred.
The Board has, nonetheless, considered and is satisfied that the
Group is sufficiently solvent and liquid to support a full Cash
Dividend.
TAX IMPLICATIONS
The Scrip Distribution and the Cash Dividend alternative may have
tax implications for both resident and non-resident
Shareholders. Shareholders are therefore encouraged to consult
their professional tax advisers, should they be in any doubt as
to the appropriate action to take.
In terms of the Income Tax Act, 58 of 1962, as amended (“the
Income Tax Act”), the Cash Dividend will, unless exempt, be
subject to DWT. South African resident Shareholders that are
liable for DWT will be subject to DWT at a rate of 20% of the
Cash Dividend and this amount will be withheld from the Cash
Dividend with the result that they will receive a net amount of
4 cents per share. Non-resident Shareholders may be subject to
DWT at a rate of less than 20%, depending on their country of
residence and the applicability of any Double Tax Agreement
between South Africa and their country of residence.
The Scrip Distribution is not subject to DWT in terms of the
Income Tax Act, but the subsequent disposal of Metrofile
Ordinary Shares obtained as a result of the Scrip Distribution
is likely to have Income Tax or Capital Gains Tax (“CGT”)
implications. Where any future disposals of Metrofile Ordinary
Shares obtained as a result of the Scrip Distribution falls
within the CGT regime, the base cost of such shares will be
deemed to be zero in terms of the Income Tax Act (or the value
at which such Metrofile Ordinary Shares will be included in the
determination of the weighted average base cost method will be
zero).
The rights to receive the Scrip Distribution shares in
jurisdictions other than the Republic of South Africa, may be
restricted by law and any failure to comply with these
restrictions may constitute a violation of the securities laws
of such jurisdictions. Accordingly, Shareholders will not be
entitled to receive the Scrip Distribution shares, directly or
indirectly, in those jurisdictions and shall be deemed to have
elected the Cash Dividend alternative. Such non-resident
Shareholders should inform themselves about and observe any
applicable legal requirements in such jurisdictions. It is the
responsibility of non-resident Shareholders to satisfy
themselves as to the full observance of the laws and regulatory
requirements of the relevant jurisdictions in respect of the
Scrip Distribution, including the obtaining of any
governmental, exchange control or other consents or the making
of any filing which may be required, compliance with other
necessary formalities and payment of any issue, transfer or
other taxes or other requisite payments due in such
jurisdictions. Shareholders who have any doubts as to their
position, including, without limitation, their tax status,
should consult an appropriate adviser in the relevant
jurisdictions without delay.
Shareholders in the United States or US persons as defined in
Regulation S under the US Securities Act of 1933 who wish to
receive the Scrip Distribution must be qualified institutional
buyers (“QIBs”) as defined in Rule 144A under the Securities Act
and also qualified purchasers (“QPs”) within the meaning of
Section 2(a)(51)(A) of the US Investment Company Act of 1940.
PROCEDURE FOR CERTIFICATED SHAREHOLDERS WHO ELECT TO RECEIVE
T HE CASH DIVIDEND ALTERNATIVE
Shareholders who wish to receive the Cash Dividend must take the
following action:
1 Certificated Shareholders wishing to receive the Cash
Dividend:
Shareholders who hold certificated Metrofile Ordinary Shares
(“Certificated Shareholders”) and who wish to receive the
Cash Dividend must complete the Form of Election included
in the Circular in respect of all or part of their
shareholding in accordance with the instructions contained
therein and lodge it with, or post it to, Computershare
Investor Services Proprietary Limited, Rosebank Towers, 15
Biermann Avenue, Rosebank, 2196, Gauteng, South Africa (P O
Box 61763, Marshalltown, 2107, Gauteng, South Africa) so as
to be received no later than 12:00 on Friday,
11 October 2019. Forms of Election received after this date
and time will not be accepted. Forms of Election may also be
emailed to corporate.events@computershare.co.za.
2 Dematerialised Shareholders wishing to receive the Cash
Dividend:
Shareholders who have dematerialised their Metrofile
Ordinary Shares (“Dematerialised Shareholders”) must not
complete the Form of Election. Dematerialised Shareholders
are required to notify their duly appointed CSDP or broker
if they wish to receive the Cash Dividend, in the manner and
the time stipulated in the agreement governing the
relationship between such Shareholders and their CSDP or
broker, failing which they will receive the Scrip
Distribution.
3 Election in respect of all or part of the Shareholders’
ordinary shares:
Shareholders may make the election, using the Form of
Election, in respect of all or any part of their Metrofile
Ordinary Shares held on the Record Date. If an election is
made in respect of part of an ordinary shareholding, the
Shareholder concerned will receive the Scrip Distribution
in respect of the Metrofile Ordinary Shares for which the
election to receive the Cash Dividend is not made.
Shareholders who do not wish to receive any Cash Dividend
do not need to take any further action and will receive the
Scrip Distribution. Shareholders electing to receive the
Cash Dividend should note that the election is irrevocable
and, once an election to receive the Cash Dividend is
made, such election cannot be cancelled.
SALIENT DATES AND TIMES
2019
Results released on the SENS of the JSE Thursday,
Limited (“JSE”) 5 September
Results information published in the press Friday,
6 September
Circular and Form of Election posted to Monday,
Shareholders and released on SENS by 11:00 23 September
Finalisation of information, including the
Tuesday,
ratio applicable to the Scrip Distribution,
1 October
released on SENS by 11:00
Finalisation of information, including the
Wednesday,
ratio applicable to the Scrip Distribution,
2 October
published in the press
Last day to trade in order to be eligible to
Tuesday,
participate in the Scrip Distribution/ Cash
8 October
Dividend alternative (“CUM”)
Ordinary Shares trade “Ex” the entitlement Wednesday,
to the Scrip Distribution/ Cash Dividend 9 October
Wednesday,
Maximum listing of shares
9 October
Announcement released on SENS in respect of
Thursday,
the cash payment applicable to the fractional
10 October
entitlement
Last day to elect the Cash Dividend
alternative in lieu of the Scrip
Distribution, by 12:00 for Certificated
Shareholders and for Dematerialised
Shareholders (in accordance with the mandate
Friday,
between the Shareholder and their CSDP/
11 October
broker)
Record date in respect of the Scrip
Friday,
Distribution/ Cash Dividend alternative,
11 October
Offer closes
Announcement released on SENS in respect of
Monday,
the results of the Scrip Dividend and
14 October
director’s dealings by 11:00
Share certificates, electronic funds
Monday,
transfers and/ or dividend cheques posted,
14 October
and CSDP/ broker accounts credited/ updated
Adjustment of Ordinary Shares in terms of Tuesday,
the Scrip Distribution 15 October
Notes to salient dates:
1. All times provided are South African standard times quoted
on a 24-hour basis, unless specified otherwise. The above
dates and times are subject to change. If applicable, any
changes will be released on SENS; and
2. Share certificates may not be dematerialised or
rematerialised between Wednesday, 9 October 2019 and Friday,
11 October 2019, both days inclusive.
Accordingly, the Circular will be distributed to Shareholders on
Monday, 23 September 2019 in which the full terms of the Scrip
Distribution and Cash Dividend alternative will be detailed.
The Company’s issued share capital at the dividend declaration
date, being Friday, 6 September 2019, was as follows:
Issued Ordinary Shares 443 854 886
Treasury Ordinary Shares 18 949 158
Net issued Ordinary Shares 424 905 728
The Company’s tax number is 9375/066/71/0.
Johannesburg
6 September 2019
Sponsor
The Standard Bank of South Africa Limited
Transaction Advisor
Apex Partners
Date: 06/09/2019 03:26:00
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