THIS DOCUMENT IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION

Transcription

1 THIS DOCUMENT IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION The definitions and interpretation commencing on page 4 of this Circular apply to this entire Document, including the cover page, except where the context indicates a contrary intention. This Document is important and should be read with particular attention to the section of this Circular entitled: Action required by Crookes Brothers Shareholders, which commences on page 2. If you are in any doubt as to the action you should take in relation to this Circular, please consult your CSDP, Broker, banker, attorney, accountant or other professional advisor immediately. ACTION REQUIRED BY CERTIFICATED AND DEMATERIALISED SHAREHOLDERS Shareholders are referred to page 2 of this Circular which sets out the detailed action required by both Certificated and Dematerialised Shareholders. CROOKES BROTHERS LIMITED (Registration number 1913/000290/06) (Share code: CKS ISIN: ZAE ) (Incorporated in the Republic of South Africa) ( Crookes Brothers or the Company ) CIRCULAR TO CROOKES BROTHERS SHAREHOLDERS Regarding: authorisation of the Board to issue Shares to Shareholders in accordance with the Silverlands Share Issue and the Claw-back Offer; and approval of the Waiver of Mandatory Offer, and incorporating: a notice convening the General Meeting of Crookes Brothers Shareholders; and a form of proxy (grey) to vote at the General Meeting (for use by Certificated Shareholders and Own-name Registered Dematerialised Shareholders only). Corporate Advisor and Sponsor Legal Advisors of Crookes Brothers Independent Expert Legal Advisors of Silverlands Date of Issue: Thursday, 2 July 2015 This Circular is only available in English. Copies of this Circular may be obtained at the registered offices of the Company and from the offices of the Corporate Advisor and Sponsor and the Transfer Secretaries, whose addresses are set out in the Corporate Information section of this Circular, from Thursday, 2 July 2015, to Thursday, 30 July 2015, both days inclusive, or can be downloaded from the Company s website at

2 CORPORATE INFORMATION DIRECTORS JR Barton (Chairman)** GS Clarke (Managing Director) PJ Barker (Financial Director) JAF Hewat** P Mnganga** MT Rutherford** RE Stewart** G Vaughan-Smith* T Denton* (alternate) **Independent Non-executive * Non-executive REGISTERED OFFICE Renishaw, KwaZulu-Natal, 4181 (PO Renishaw, KwaZulu-Natal, 4181) COMPANY SECRETARY Highway Corporate Services Proprietary Limited (Registration number: 2003/023043/07) 14 Hillcrest Office Park 2 Old Main Road Hillcrest, 3610 (PO Box 1319, Hillcrest, 3650) CORPORATE ADVISOR AND SPONSOR Sasfin Capital (a division of Sasfin Bank Limited) (Registration number: 1951/002280/06) 29 Scott Street Waverley, Johannesburg, 2090 (PO Box 95104, Grant Park, 2051) TRANSFER SECRETARIES Computershare Investor Services Proprietary Limited (Registration number: 2004/003647/07) Ground Floor, 70 Marshall Street Johannesburg, 2001 (PO Box 61051, Marshalltown, 2107) DATE AND PLACE OF INCORPORATION LEGAL ADVISORS OF THE COMPANY Norton Rose Fulbright South Africa Inc. (Registration number: 1984/003385/21) 3 Pencarrow Crescent Pencarrow Park La Lucia Ridge, 4051 (PO Box 5003, Pencarrow Park, 4019) INDEPENDENT EXPERT Grindrod Bank Limited (Registration number: 1994/007994/06) 4th Floor, Grindrod Tower 8a Protea Place Sandton, 2194 (PO Box 78011, Sandton, 2194) 1913, KwaZulu-Natal, South Africa LEGAL ADVISORS OF SILVERLANDS Cliffe Dekker Hofmeyr Incorporated (Registration number: 2008/018923/21) 1 Protea Place, Corner of Fredman & Protea Place, Sandton Johannesburg, 2196 (Private Bag X40, Benmore, 2010) ii

3 CONTENTS Page CORPORATE INFORMATION Inside front cover ACTION REQUIRED BY CROOKES BROTHERS SHAREHOLDERS 2 SALIENT DATES AND TIMES 3 DEFINITIONS AND INTERPRETATIONS 4 CIRCULAR TO CROOKES BROTHERS SHAREHOLDERS 7 1. Introduction and background 7 2. The Silverlands Share Issue 8 3. The Claw-back Offer 8 4. Mandatory Offer and Waiver 9 5. The Obligatory Offer Independent Board Opinion Directors recommendation The General Meeting Financial information of Crookes Brothers Shareholding information Directors Directors Responsibility Statement and Independent Board s Responsibility Statement Litigation statement Consents Documentation available for inspection 13 ANNEXURES 1. Fair and Reasonable Opinion of the Independent Expert Historical financial information of Crookes Brothers Share trading history of Crookes Brothers Shares 29 NOTICE OF GENERAL MEETING 30 FORM OF PROXY (GREY) Attached 1

4 ACTION REQUIRED BY CROOKES BROTHERS SHAREHOLDERS Please take careful note of the following provisions regarding the action required by Crookes Brothers Shareholders: The definitions and interpretations commencing on page 4 of this Circular apply, mutatis mutandis, to this information on action required by Crookes Brothers Shareholders. This Circular contains important information regarding the Silverlands Share Issue, Claw-back Offer and the Waiver of Mandatory Offer. You should carefully read this Circular and decide on how you wish to vote on the Resolutions to be proposed at the General Meeting. If you have disposed of all of your Shares in Crookes Brothers, please forward this Circular to the person to whom you have disposed of such Shares or the Broker, CSDP, banker or other agent through whom you disposed of such Shares. The Silverlands Share Issue, Claw-back Offer and the Waiver of Mandatory Offer (and matters related thereto) are subject to Shareholders passing the requisite Resolutions at the General Meeting of Shareholders to be held at 14:00 on Thursday, 30 July 2015, at KwaShukela in the South African Sugar Association (SASA) complex, 170 Flanders Drive, Mount Edgecombe, KwaZulu-Natal. IF YOU HAVE DEMATERIALISED YOUR CROOKES BROTHERS SHARES OWN-NAME REGISTRATION You are entitled to attend in person, or be represented by proxy, at the General Meeting. If you are unable to attend the General Meeting, but wish to be represented thereat, you must complete and return the attached form of proxy (grey), in accordance with the instructions contained therein, to be received by the Transfer Secretaries, Computershare, Ground Floor, 70 Marshall Street, Johannesburg, 2001 (PO Box 61051, Marshalltown, 2107) by no later than 14:00 on Tuesday, 28 July Other than Own-name Registration You are entitled to attend, or be represented by proxy, at the General Meeting. You must not however, complete the attached form of proxy (grey). You must advise your CSDP or Broker timeously if you wish to attend, or be represented at the General Meeting. If your CSDP or Broker does not contact you, you are advised to contact your CSDP or Broker and provide them with your voting instructions. If your CSDP or Broker does not obtain instructions from you, they will be obliged to act in terms of your mandate furnished to them. If you do wish to attend or be represented at the General Meeting, your CSDP or Broker will be required to issue the necessary letter of representation or other authority to you to enable you to attend or to be represented at the General Meeting. Crookes Brothers does not accept any responsibility and will not be held liable for any failure on the part of the Broker or CSDP (as the case may be) of a Dematerialised Shareholder to notify such Dematerialised Shareholder of the details of this Circular. IF YOU HOLD CERTIFICATED CROOKES BROTHERS SHARES You are entitled to attend, or be represented by proxy, at the General Meeting. If you are unable to attend the General Meeting, but wish to be represented thereat, you must complete and return the attached form of proxy (grey), in accordance with the instructions contained therein, to be received by the Transfer Secretaries, Computershare, Ground Floor, 70 Marshall Street, Johannesburg, 2001 (PO Box 61051, Marshalltown, 2107) by no later than 14:00 on Tuesday, 28 July

5 SALIENT DATES AND TIMES The definitions and interpretations commencing on page 4 of this Circular apply mutatis mutandis to this section Waiver of Mandatory Offer, Claw-back Offer Declaration and Notice of General Meeting published on SENS Record date in order to receive the Circular and the Notice of the General Meeting Waiver of Mandatory Offer, Claw-back Offer Declaration and Notice of General Meeting published in the South African press Circular and notice of General Meeting posted to Crookes Brothers Shareholders Last day to lodge objections with the TR Panel at 12:00 Last day to trade in order to be eligible to vote at the General Meeting Record date in relation to voting at the General Meeting Last day to lodge forms of proxy in respect of the General Meeting by 14:00 General Meeting to be held at 14:00 Results of the General Meeting published on SENS Results of the General Meeting published in the South African press Thursday, 25 June Friday, 26 June Friday, 26 June Thursday, 2 July Thursday, 16 July Friday, 17 July Friday, 24 July Tuesday, 28 July Thursday, 30 July Thursday, 30 July Friday, 31 July Notes: 1 All times referred to in this Circular are local times in South Africa. 2 The above dates and times are subject to amendment. Any material variation of the above dates and times will be published on SENS. 3 To be valid, the completed forms of proxy must be lodged with the Transfer Secretaries, Computershare Investor Services Proprietary Limited, Ground Floor, 70 Marshall Street, Johannesburg, 2001 or posted to the Transfer Secretaries at PO Box 61051, Marshalltown, 2107, to reach them by no later than 14:00 on Tuesday, 28 July 2015, alternatively, such proxy forms may be handed to the Company Secretary or Chairman of the General Meeting at any time prior to commencement of the General Meeting. 3

6 DEFINITIONS AND INTERPRETATIONS In this Circular, unless otherwise stated or the context so requires, the words in the first column have the meanings stated opposite them in the second column, words in the singular shall include the plural and vice versa, words denoting one gender include the other and expressions denoting natural persons include juristic persons and associations of persons: the Act or the Companies Act Associates Board or the Directors Broker Business Day Certificated Shareholders Certificated Shares this Circular or this Document Claw-back Offer Claw-back Offer Circular Claw-back Offer Price Claw-back Record Date Claw-back Shares Companies Regulations Computershare or Transfer Secretaries Corporate Advisor and Sponsor or Sasfin Crookes Brothers or the Company Crookes Brothers Shareholders or Shareholders Crookes Brothers Shares or Ordinary Shares or Shares CSDP Custody Agreement Dematerialisation Dematerialised Shareholders the Companies Act, No. 71 of 2008, as amended; one or more associates as defined in the Listings Requirements; the board of directors of Crookes Brothers, as reflected inside the front cover of this Document; any person registered as a broking member (equities) in terms of the rules of the JSE made in accordance with the provisions of the Financial Markets Act; any day other than a Saturday, Sunday or official public holiday in South Africa; holders of Certificated Shares; Crookes Brothers Shares, represented by a Share certificate or other Document(s) of Title, which are not Dematerialised Shares; this circular to Shareholders dated Thursday, 2 July 2015, and the annexures hereto; the proposed claw-back offer by Crookes Brothers to the Claw-back Record Date Shareholders to claw back their pro rata portion of the Claw-back Shares (based on their holdings of Crookes Brothers Shares on the Claw-back Record Date), and which claw back will enable them to maintain, should they elect to fully take up the Claw-back Offer, their current percentage Shareholding in Crookes Brothers; the circular to Shareholders containing details of the Claw-back Offer and including the renounceable (nil paid) letters of allocation which will be issued by Crookes Brothers in electronic form conferring the right on Shareholders to follow their rights in terms of the Claw-back Offer and subscribe for the Claw-back Shares pursuant to the Claw-back Offer, which circular is to be distributed to Certificated Shareholders on or about Tuesday, 25 August 2015, and to Dematerialised Shareholders on or about Tuesday, 1 September 2015; the price at which the Claw-back Record Date Shareholders can claw back and subscribe for Claw-back Shares in terms of the Claw-back Offer, being R80 per Claw-back Share; the record date for Shareholders to participate in the Claw-back Offer on the terms and conditions detailed in the Claw-back Offer Circular, which is anticipated as being Friday, 28 August 2015; Crookes Brothers Shares which can be subscribed for by Claw-back Record Date Shareholders in terms of the Claw-back Offer; the regulations promulgated by the Minister in terms of section 223 of the Companies Act, and which include regulations relating to the functioning of the TR Panel; Computershare Investor Services Proprietary Limited (Registration number 2004/003647/07), a private company duly incorporated in accordance with the laws of South Africa, being the transfer secretaries of Crookes Brothers; Sasfin Capital, a division of Sasfin Bank Limited (Registration number 1951/ /06), a company duly incorporated in accordance with the laws of South Africa; Crookes Brothers Limited (Registration number 1913/000290/06), a public company, duly incorporated in accordance with the laws of South Africa, the ordinary shares of which are listed on the main board of the stock exchange operated by the JSE; registered holders of Crookes Brothers Shares; ordinary shares with a par value of R0.25 each in the issued ordinary Share capital of Crookes Brothers; a person that holds in custody and administers securities or an interest in securities and that has been accepted in terms of section 34 of the Financial Markets Act by a central securities depository or a participant, as defined in the Financial Markets Act; the agreement which regulates the relationship between the CSDP or Broker and each beneficial holder of Dematerialised Shares; the process by which Certificated Shares are converted to an electronic form as uncertificated Shares and recorded in the sub-register of shareholders maintained by a CSDP; holders of Dematerialised Shares; 4

7 Dematerialised Shares Documents of Title Crookes Brothers Shares that have been dematerialised through a CSDP or Broker and are held in a sub-register in electronic form; valid Share certificates, certified transfer deeds, balance receipts or any other proof of ownership of Crookes Brothers Shares, reasonably acceptable to Crookes Brothers; Financial Markets Act the Financial Markets Act, No 19 of 2012; General Meeting General Meeting Record Date the Group IFRS Independent Board Independent Board Members the Independent Shareholders the Independent Expert or Grindrod JSE Last Practicable Date Legal Advisors of Crookes Brothers or Norton Rose Legal Advisors of Silverlands or CDH Listings Requirements Mandatory Offer Minister MOI Notice of General Meeting or Notice Obligatory Offer Obligatory Offer Agreement Own-name Registration or Own-name Registered Dematerialised Shareholders Prescribed Percentage the general meeting of Shareholders to be held at 14:00 on Thursday, 30 July 2015, at KwaShukela in the South African Sugar Association (SASA) complex, 170 Flanders Drive, Mount Edgecombe, KwaZulu-Natal, to consider, and if deemed fit, approve, with or without modification, the Resolutions; Friday, 24 July 2015, being the date on which Crookes Brothers Shareholders must be recorded in the Register so as to be able to attend and vote at the General Meeting; Crookes Brothers and its Subsidiaries and Associates; International Financial Reporting Standards as issued by the International Accounting Standards Board; the Independent Board Members, acting as the independent board for purposes of the Companies Act and the Takeover Regulations; being the independent Directors, in terms of Takeover Regulations 81 and 108(9), which members are Messrs JAF Hewat, MT Rutherford and RE Stewart; Crookes Brothers Shareholders who are independent of Silverlands or any related or inter-related person, or person acting in concert with any of them; Grindrod Bank Limited (Registration number: 1994/007994/06) a public company duly incorporated in accordance with the laws of South Africa, and licensed as a bank under the Banks Act, No. 94 of 1990, as amended; JSE Limited (Registration number 2005/022939/06), a public company duly incorporated in accordance with the laws of South Africa and licensed as an exchange under the Financial Markets Act; Friday, 26 June 2015, being the last practicable date prior to the finalisation of this Circular; Norton Rose Fulbright South Africa Incorporated (Registration number 1984/003385/21), a personal liability company duly incorporated in accordance with the laws of South Africa; Cliffe Dekker Hofmeyr Incorporated (Registration number 2008/018923/21), a personal liability company duly incorporated in accordance with the laws of South Africa; the listings requirements of the JSE; the potential mandatory offer that would be required to be made by Silverlands to the Remaining Shareholders, in terms of section 123 of the Companies Act, to acquire all of the Crookes Brothers Shares in issue held by the Remaining Shareholders in the event that, pursuant to the Silverlands Share Issue and the Claw-back Offer, Silverlands acquires a beneficial interest in voting rights in Crookes Brothers equal to or more than the Prescribed Percentage; the member of the cabinet who is responsible for companies; the Memorandum of Incorporation of Crookes Brothers; the notice convening the Shareholders meeting which is attached to and forms part of this Circular; subject to the further terms of the Obligatory Offer Agreement, the offer to be made by Silverlands in terms of the Obligatory Offer Agreement to the Remaining Shareholders to acquire their Shares in the event that Silverlands, together with any related or inter-related person, and any person acting in concert with any of them, at any time after the implementation of the Claw-back Offer and Silverlands Share Issue, increases its beneficial interest in the voting rights of Crookes Brothers to, or above, 45% of all the voting rights in the Company; the Obligatory Offer Agreement entered into between Crookes Brothers and Silverlands on 24 June 2015 which sets out the terms and conditions applicable to the Obligatory Offer and the circumstances under which it is to be made; Shareholders who hold Shares that have been dematerialised and are recorded by the CSDP in the sub-register kept by the CSDP in the name of such Shareholder; the percentage prescribed in terms of section 123(5) of the Companies Act, which percentage is currently 35% of the voting securities of a company; 5

8 Rand or R or ZAR Register Remaining Shareholders Resolutions SENS Silverlands the Silverlands Share Issue Silverlands Subscription Shares South Africa Subscription Agreement Subsidiary TR Panel or TRP Takeover Regulations VAT VWAP Waiver or Waiver of Mandatory Offer South African Rand; Crookes Brothers Share register, including all sub-registers; Crookes Brothers Shareholders, other than Silverlands, those persons related or inter-related to it and those persons acting in concert with any of them; the resolutions set out in the Notice of the General Meeting, which are to be considered and voted on at the General Meeting; the Stock Exchange News Service, the news service operated by the JSE; Silverlands (SA) Plantations S.ár.l a société à responsibilité limitée registered and incorporated in accordance with the laws of the Grand Duchy of Luxembourg, whose registration number is B171996, a wholly-owned Subsidiary of SilverStreet Private Equity Strategies SICAR Silverlands Fund, a private equity fund incorporated in Luxembourg; the issue and allotment to Silverlands of all of the Silverlands Subscription Shares at the Clawback Offer Price per Silverlands Subscription Share; those Claw-back Shares not issued pursuant to the Claw-back Offer; the Republic of South Africa; the Subscription for Shares and Claw-back Rights Offer Agreement entered into between Silverlands and Crookes Brothers on 24 June 2015 containing the terms and conditions of the Silverlands Share Issue and the Claw-back Offer; a subsidiary as defined in section 3 of the Companies Act; the Takeover Regulation Panel established in terms of section 196 of the Companies Act; the regulations made by the Minister in terms of sections 120 and 223 of the Companies Act; Value-Added Tax; volume weighted average price; and the proposed waiver by the Independent Shareholders of the right to receive the Mandatory Offer, in terms of Takeover Regulation 86(4), by way of a Resolution adopted at the General Meeting. 6

9 CROOKES BROTHERS LIMITED (Registration number 1913/000290/06) (Share code: CKS ISIN: ZAE ) (Incorporated in the Republic of South Africa) ( Crookes Brothers or the Company ) DIRECTORS JR Barton (Chairman)** GS Clarke (Managing Director) PJ Barker (Financial Director) JAF Hewat** P Mnganga** MT Rutherford** RE Stewart** G Vaughan-Smith* T Denton* (alternate) **Independent Non-executive * Non-executive CIRCULAR TO CROOKES BROTHERS SHAREHOLDERS 1. INTRODUCTION AND BACKGROUND 1.1. Introduction Crookes Brothers is a South African public company with agricultural operations in the KwaZulu-Natal, Mpumalanga and Western Cape provinces of South Africa, as well as in Swaziland, Zambia and Mozambique. The Group specialises in the production of primary agricultural products. It listed on the main board of the exchange operated by the JSE in In an announcement published on SENS on 25 June 2015, Shareholders were advised that: in order for the Company to raise R215 million to fund its growth strategy in Sub-Saharan Africa, Silverlands, a material Shareholder of Crookes Brothers, has agreed to subscribe for Crookes Brothers Shares at an issue price of R80 per Share; the Silverlands Share Issue will be implemented by way of a claw-back rights offer. In terms of the Claw-back Offer, prior to allotting the Shares subscribed for by Silverlands in the Silverlands Share Issue, Shareholders will be afforded the opportunity to claw back (or subscribe for) their pro rata portion of the Claw-back Shares, at the same price per Silverlands Subscription Shares will be allotted to Silverlands; the Silverlands Share Issue may result in Silverlands being able to exercise voting rights equal to or in excess of the Prescribed Percentage and, as such, in these circumstances, Silverlands will be required to offer to purchase all of the Shares held by the Remaining Shareholders. It is a condition therefore to the Silverlands Share Issue that the Independent Shareholders waive Silverlands obligation/their rights to receive the Mandatory Offer; and Silverlands and the Company have concluded the Obligatory Offer Agreement, in terms of which (among other things), and as comfort to the Independent Shareholders in adopting the Waiver. Silverlands will be required to make an Obligatory Offer in the event that Silverlands holdings of voting rights in the Company exceeds 45% of all the voting rights in Crookes Brothers The purpose of this Circular is to furnish Shareholders with relevant information relating to the Silverlands Share Issue, the Claw-back Offer, the Mandatory Offer that may result therefrom, the request for the Waiver of Mandatory Offer, the Obligatory Offer and Resolutions to be proposed at the General Meeting and the implications thereof, in accordance with the provisions of the Companies Act and the Companies Regulations. 7

10 1.2. The Silverlands Share Issue and the Claw-back Offer The Board has proposed that the capitalisation of the Company be implemented by way of the Silverlands Share Issue and the Claw-back Offer, in terms of which Silverlands will undertake to subscribe for Crookes Brothers Shares and the Shareholders will have the right to take up their pro rata shares of the Clawback Shares (or part thereof) upon the same terms as the Silverlands Share Issue, within a defined period of time, so as to enable them to maintain, should they so elect, their current percentage Shareholding in Crookes Brothers The rationale for the Silverlands Share Issue and the Claw-back Offer is primarily to raise R215 million in capital in order for the Company to realise, inter alia, the following long and short-term goals: retire up to R100 million in debt; complete Phase 1 of the Company s Renishaw Property Development project; complete the Company s Murrimo Macadamia Development project; and pursue other identified projects The Silverlands Share Issue and Claw-back Offer will provide a capital injection of R215 million for the Company enabling it to pursue its strategy for growth in Sub-Saharan Africa and will result in value accretion for Shareholders. 2. THE SILVERLANDS SHARE ISSUE 2.1. Silverlands, currently a 33.05% material Shareholder of Crookes Brothers, has, in terms of the Subscription Agreement, agreed to subscribe for the Silverlands Subscription Shares at a price of R80 per Share. This issue price represents a premium of % to the 30 day VWAP of the Company s Shares on the JSE up to and including 24 June 2015 of R , being the day before the date of the SENS announcement of the Silverlands Share Issue The Silverlands Share Issue will be subject to, in addition to the conditions listed in 2.4 below, the prior implementation of the Claw-back Offer and, accordingly, the Shares to be issued to Silverlands in the Silverlands Share Issue will be those of the Crookes Brothers Shares available for issue, not subscribed for by the Claw-back Record Date Shareholders pursuant to the Claw-Back Offer The issue price for the Silverlands Subscription Shares will be payable in ZAR in cash The Subscription Agreement is subject to the fulfilment of inter alia, the following conditions precedent: that whatever unconditional approvals, consents, exemptions, waivers or compliance certificates as may be required to be obtained from the TR Panel, the JSE and the Financial Surveillance Department of the South African Reserve Bank, or its duly authorised agent, are received or obtained (to the extent required) for the Waiver of Mandatory Offer, the Silverlands Share Issue and the Claw-back Offer, and/or the implementation of any of them (including, among others, the approval of all documents/circulars in relation thereto), or if any such approvals, consents, exemptions, waivers or compliance certificates are conditional, such conditions being satisfactory to Crookes Brothers and Silverlands; that the Independent Shareholders pass an ordinary resolution waiving their right to receive the Mandatory Offer in terms of section 123 of the Companies Act and Takeover Regulation 86 at the General Meeting as detailed in paragraph 4 below; that the TR Panel approves the Waiver of Mandatory Offer by the Independent Shareholders; and that the relevant competition authorities approve the Silverlands Share Issue, to the extent such approval is required Shareholders should note that the Waiver of Mandatory Offer, the authorisation of the Silverlands Share Issue and the Claw-back Offer, and the approval of the relevant Resolutions are inter-conditional. Therefore, should any one of the aforementioned Resolutions not be approved by Shareholders at the General Meeting, the Silverlands Share Issue will be of no force and effect, the Claw-back Offer will not be implemented and the capitalisation of the Company will fail. 3. THE CLAW-BACK OFFER Particulars of the Claw-back Offer 3.1. All of the Shareholders (including Silverlands) and/or their renouncees will be offered the right to claw-back (i.e. subscribe for) their pro rata portion (based on their holdings of Crookes Brothers Shares on the Claw-back Record Date), by way of a renounceable Claw-back Offer, of the Claw-back Shares. The Claw-back Shares will be offered to the Shareholders on substantially the same terms as the Silverlands Subscription Shares were offered to Silverlands; namely, but subject to the terms and conditions set out in the Claw-back Offer Circular, a total of Crookes Brothers Shares will be offered in the Claw-back Offer at a Claw-back Offer Price of R80 per Share. The Shareholders will not be obliged to take up their full allocation of Claw-back Shares, and may take up part only The Claw-back Offer Price will be payable in ZAR and in full upon acceptance by Certificated Shareholders, or on a delivery versus payment basis by the CSDP or Broker of Dematerialised Shareholders who have accepted the Claw-back Offer The Claw-back Offer Price represents a premium of % to the 30 day VWAP of the Company s Shares on the JSE up to and including 24 June 2015 of R , being the day before the date of the SENS announcement of the Silverlands Share Issue. 8

11 3.4. The Shareholders (recorded in the register at the close of trade on the Claw-back Record Date) or their renouncees in terms of the Claw-back Offer will be entitled to participate in the Claw-back Offer Opening and closing dates of the Claw-back Offer: Crookes Brothers will issue the Claw-back Offer circular to Certificated Shareholders on or about Tuesday, 25 August 2015, and to Dematerialised Shareholders on or about Tuesday, 1 September 2015, and it is anticipated that the Claw-back Offer will open at the commencement of trade on Monday, 31 August 2015, and will close at 12:00 on Friday, 11 September Excess applications: The Claw-back Offer will not include the right for Shareholders to apply for excess Claw-back Shares. 4. MANDATORY OFFER AND WAIVER 4.1. The Silverlands Share Issue and the Claw-back Offer may result in Silverlands acquiring more than 35% of the voting rights of Crookes Brothers, being the Prescribed Percentage in terms of section 123(5) of the Companies Act. In such event, in terms of section 123 of the Companies Act, Silverlands would be obliged to make the Mandatory Offer to the Remaining Shareholders of Crookes Brothers at the same price, unless the Mandatory Offer is waived in accordance with Takeover Regulation 86(4) Silverlands is not able or willing to make the Mandatory Offer and has consequently entered into the Subscription Agreement on the basis that its subscription for the Claw-back Shares is dependent on the Independent Shareholders waiving the Mandatory Offer In order to achieve the capitalisation of the Company, Independent Shareholders will be requested to waive their right to receive the Mandatory Offer by way of an ordinary resolution to be proposed at the General Meeting. The Resolution must be approved by the independent holders of more than 50% of the general voting rights of all the issued Shares, present and voting or represented by proxy Silverlands and any other non-independent Shareholders will not be able to vote on this Resolution The TR Panel has advised that it is willing to consider the application to grant an exemption from the obligation to make the Mandatory Offer if the majority of Independent Shareholders of Crookes Brothers waive their entitlement to receive the Mandatory Offer from Silverlands, in accordance with Takeover Regulation 86(4) In terms of Takeover Regulation 86(7) a fair and reasonable opinion must be included in the Circular in terms of which the Waiver is proposed. The opinion of the Independent Expert is annexed to this Circular as Annexure In terms of Guideline 1/2013 issued by the TR Panel, Crookes Brothers may approach 5 or less Independent Shareholders each holding more than 5% of the issued Share capital of Crookes Brothers to obtain irrevocable undertakings in favour of the Waiver subject to stringent non-disclosure requirements Given the Company s current spread of Shareholders and the fact that very few meet the aforesaid criteria, the TR Panel has provided a non-binding opinion to allow Crookes Brothers to approach 10 or less Independent Shareholders each holding more than 1% of the issued Share capital, which is outside the Guideline 1/2013 issued by the TR Panel. Crookes Brothers has consequently requested and received irrevocable undertakings and letters of intent in favour of the Waiver of the Mandatory Offer from the following Independent Shareholders, such Independent Shareholders representing 16.32% of the required vote to implement the Waiver. SHAREHOLDER NUMBER OF SHARES HELD % HOLDING IN CROOKES BROTHERS Ellingham Estate (Pty) Ltd % SBSA ITF Oasis Prop EQ UT FND % PM Oehley Children Trust % Mrs Jennifer Rosemary Howson % SCB ATF Old Mutual Albaraka Equity Fund % The Elizabeth Crookes Trust % TOTAL % 4.9. In terms of Takeover Regulation 106(6)(a) it is confirmed that the following Independent Shareholder who has provided an irrevocable undertaking or letter of intent has traded in the Company s Shares in the six months prior to the Last Practicable Date as follows: SHAREHOLDER DATE VOLUME SOLD AVERAGE SELLING PRICE PER SHARE (CENTS) SCB ATF Old Mutual Albaraka Equity Fund 17/02/

12 4.10. Any Shareholder of Crookes Brothers who wishes to make representations relating to the exemption shall have 10 Business Days from the date of posting of this Circular to make such representation to the TR Panel before the ruling is considered. Representations should be made in writing and delivered by hand, posted or faxed to: IF DELIVERED BY HAND OR COURIER IF POSTED IF FAXED The Executive Director The Executive Director The Executive Director Takeover Regulation Panel Takeover Regulation Panel Takeover Regulation Panel 1st Floor, Building B PO Box Sunnyside Office Park Auckland Park 32 Princess of Wales Terrace 2006 Parktown 2193 and should reach the TR Panel by no later than the close of business on Thursday, 16 July 2015, in order to be considered If any representations are made to the TR Panel, within the permitted timeframe, the TR Panel will consider the merits thereof before making a ruling Included in this Circular is the notice of General Meeting and Resolution for the Waiver of Mandatory Offer for Independent Shareholders to consider and, if deemed fit, to approve, with or without modification at the General Meeting Should the requisite majority of Independent Shareholders vote in favour of the Waiver of Mandatory Offer, subsequent application will be made to the TR Panel to exempt Silverlands from its obligation to make the Mandatory Offer. 5. THE OBLIGATORY OFFER 5.1. In terms of the Obligatory Offer Agreement, Crookes Brothers and Silverlands have agreed that if Silverlands: acting alone; or acting in concert with any person; and/or acting with any related party, acquires a beneficial interest in voting rights in Crookes Brothers; and before that acquisition Silverlands and any of the concert parties or related parties (if any) together (the Acquiring Parties ) were able to exercise voting rights in respect of less than 45% of the total voting rights, and as a result of that acquisition, the Acquiring Parties are able to exercise voting rights equal to or more than 45% of the total voting rights, then, subject to the remaining provisions of this paragraph 5, Silverlands will be obliged, within 20 business days thereafter, to express to the Board a firm intention to make a written offer to acquire all of the Shares held by the Remaining Shareholders, as contemplated in section 117(1)(c)(v) of the Companies Act Silverlands will not be obliged to make an Obligatory Offer where the voting rights which the Acquiring Parties have acquired and are able to exercise equals or exceeds 45% of all the voting rights by reason of Crookes Brothers issuing additional Shares to an Acquiring Party as consideration for an asset acquired from such Acquiring Party Further, where the voting rights which the Acquiring Parties have acquired and are able to exercise equals or exceeds 45% of all the voting rights by reason of Crookes Brothers reacquiring any of its own shares; and/or by reason of any action or omission taken by any Acquiring Party in following its rights to acquire more Shares (by example, where Crookes Brothers issues a scrip dividend); then Silverlands will be given the opportunity, for a period of 30 days ( Interim Period ) to dispose of so many voting rights as will ensure that the voting rights that the Acquiring Parties are able to exercise are less than 45% of the total voting rights of Crookes Brothers ( Excess Rights ). If Silverlands has not disposed of the Excess Rights by the end of the Interim Period, Crookes Brothers shall be entitled to buy back from Silverlands (and Silverlands will be obliged to sell) so many Shares, at the 30 day VWAP, as will ensure that the Acquiring Parties are only able to exercise Voting Rights less than the Obligatory Offer Threshold (the Excess Shares ). Crookes Brothers shall, if it wishes to buy back Shares from Silverlands as set out above, make its election to do so within 20 Business Days after the elapse of the Interim Period, by giving written notice to that effect to Silverlands. If Crookes Brothers gives such written notice, then it shall, as soon as reasonably possible thereafter, but in any event within six months after the end of the Interim Period, do all such things as may be required to give effect to the buy back, including obtaining any required shareholder approvals. Where Crookes Brothers fails for any reason to buy back the Excess Shares within the six month period provided therefor, then, no Trigger Event shall be deemed to occur and there shall be no further consequences for Silverlands in relation to it, together with any other Acquiring Parties, being able to exercise Voting Rights equal to and/or in excess of the Obligatory Offer Threshold Silverlands obligation to make the Obligatory Offer will not take effect unless, immediately subsequent to the Silverlands Share Issue and the Claw-back Offer, the percentage voting rights which Silverlands is beneficially able to exercise, as percentage of all voting rights associated with the voting securities of the Company, equals or exceeds 35%. 10

13 6. INDEPENDENT BOARD OPINION After taking the factors indicated under Takeover Regulation 110 into account, the Independent Board considered the terms and conditions of the Waiver of Mandatory Offer and the fair and reasonable opinion of the Independent Expert and is of the opinion that the terms and conditions thereof are fair and reasonable to Shareholders. 7. DIRECTORS RECOMMENDATION AS TO THE WAIVER All of the Directors of Crookes Brothers who hold Shares and are able to vote, intend voting in favour of the Resolutions and recommend that Shareholders vote in favour of the Resolutions as set out in the notice of General Meeting. 8. THE GENERAL MEETING The General Meeting of the Shareholders of Crookes Brothers will be held at KwaShukela in the South African Sugar Association (SASA) complex, 170 Flanders Drive, Mount Edgecombe, KwaZulu-Natal at 14:00 on Thursday, 30 July 2015, to consider the Resolutions necessary to give the Directors authority to issue Shares in terms of the Silverlands Share Issue, subject to the Claw-back Offer and to approve the Waiver. Shareholders are referred to page 2 of this Circular, which sets out the action required of Shareholders in this regard. 9. FINANCIAL INFORMATION OF CROOKES BROTHERS Extracts from the published financial results of Crookes Brothers for the 12 month financial period ended 31 March 2015, 31 March 2014 and 31 March 2013 are included in Annexure 2 and the full financial results can be obtained on the Company s website at SHAREHOLDING INFORMATION As at the Last Practicable Date, Silverlands held 33.05% of the issued Share capital The major beneficial Shareholders holding 5% or more of the issued Share capital, as at the Last Practicable Date, are set out in the table below. SHAREHOLDER NUMBER OF SHARES % OF ISSUED SHARE CAPITAL Silverlands (SA) Plantations S.a.r.L % Ellingham Estate Pty Ltd % TCB Crookes Grandchildren s Trust % TOTAL % A table showing the trading history of Crookes Brothers Shares on the JSE is set out in Annexure 3 to this Circular. 11. DIRECTORS Directors interest in securities As at the Last Practicable Date, the Directors held, directly and indirectly, beneficial interests in the Company s issued ordinary Share capital as reflected below: NAME DIRECT INDIRECT TOTAL SHARES TOTAL % JR Barton PJ Barker % GS Clarke % JAF Hewat GP Wayne 1 P Mnganga MT Rutherford RE Stewart P Bhengu 2 CJH Chance % XGS Sithole 4 G Vaughan-Smith T Denton TOTAL % 1 Retired with effect from 1 August Retired with effect from 25 February Resigned with effect from 29 May Resigned with effect from 6 June

14 There have been no changes in the Directors interests since the date of the last published annual financial statements of the Company, other than that of CJH Chance, with an indirect interest in shares, who resigned from the Board on 29 May 2015, as reflected above. G Vaughan-Smith and T Denton represent the interests of and have direct and indirect participation in Silverlands Directors emoluments The remuneration and benefits paid to the Directors for the period ending 31 March 2015 are as follows: EXECUTIVE SALARY BONUS RETIREMENT AND MEDICAL CONTRI- BUTIONS EXERCISE OF SHARE OPTIONS OTHER BENEFITS TOTAL PJ Barker GS Clarke NON-EXECUTIVE DIRECTORS FEES COMMITTEE FEES TOTAL JR Barton JAF Hewat P Mnganga MT Rutherford GP Wayne P Bhengu RE Stewart CJH Chance XGS Sithole G Vaughan-Smith T Denton TOTAL Retired with effect from 1 August Retired with effect from 25 February Resigned with effect from 29 May Resigned with effect from 6 June Directors service contracts The service agreements of the executive Directors of Crookes Brothers contain terms and conditions that are standard for agreements of such a nature and are terminable on written notice, during which period the director would be remunerated in full. Copies of Directors service contracts or summaries thereof, are available for inspection in the manner indicated in paragraph 15 of this Circular. 12. DIRECTORS RESPONSIBILITY STATEMENT AND INDEPENDENT BOARD S RESPONSIBILITY STATEMENT Directors responsibility statement: The Directors, collectively and individually, accept full responsibility for the accuracy of the information given and certify that, to the best of their knowledge and belief, there are no facts which have been omitted which would make any statement in the Circular false or misleading and that all reasonable enquiries to ascertain such facts have been made Independent Board s responsibility statement: The Independent Board of Crookes Brothers established to consider the Waiver of Mandatory Offer, accepts responsibility for the information contained in this Circular and, to the best of its knowledge and belief, confirms that the information is true and this Circular does not omit anything likely to affect the importance of the information included. 13. LITIGATION STATEMENT The Company is not party to any legal or arbitration proceedings, nor, as far as the Directors are aware, are there any legal or arbitration proceedings pending or threatened against Crookes Brothers which may have, or have had in the 12 months preceding the date of this Circular, a material effect on the Company s financial position. 14. CONSENTS The Company s Corporate Advisor and Sponsor, Legal Advisors of Crookes Brothers, Legal Advisors of Silverlands and Independent Expert have consented in writing to act in the capacities stated and to their names being stated in this Circular and had not withdrawn their consents prior to the publication of this Circular. 12

15 15. DOCUMENTATION AVAILABLE FOR INSPECTION Copies of the following documents will be available for inspection at the Company s offices at Renishaw, KwaZulu-Natal and the offices of its Corporate Advisor and Sponsor (whose address is set out in the Corporate Information section of this Circular), at any time during normal business hours from 08:30 to 17:00 from Thursday, 2 July 2015 to Thursday, 30 July 2015: the MOI; the Subscription Agreement; the Obligatory Offer Agreement; copies of the irrevocable undertakings/letters of intent referred to in paragraph 4.8 of this Circular; the original fair and reasonable opinion of the Independent Expert; Directors service contracts referred to in paragraph 11.3 of this Circular; letters of consent referred to in paragraph 14 in this Circular; the audited financial statements for Crookes Brothers for the financial years ended 31 March 2015, 31 March 2014 and 31 March 2013; the approval letter of the TR Panel; and a signed copy of this Circular. BY ORDER OF THE BOARD GS Clarke Managing Director 26 June

16 ANNEXURE 1 FAIR AND REASONABLE OPINION OF THE INDEPENDENT EXPERT The Directors Crookes Brothers Limited Renishaw KwaZulu-Natal 29 June 2015 Dear Sirs FAIR AND REASONABLE OPINION IN RESPECT OF THE WAIVER OF THE OBLIGATION TO MAKE A MANDATORY OFFER TO THE SHAREHOLDERS OF CROOKES BROTHERS LIMITED 1. INTRODUCTION Shareholders of Crookes Brothers Limited ( Crookes Brothers or the Company ) were advised in an announcement published on SENS on 25 June 2015, that Silverlands (SA) Plantations S.ár.l a société responsibilité limitée ( Silverlands ), a material shareholder of Crookes Brothers, has entered into an agreement with the Company to subscribe for new Crookes Brothers shares at an issue price of R80 per share ( the Silverlands Share Issue ). The Silverlands Share Issue is subject to the Company proceeding with a claw-back offer, in terms of which Crookes Brothers shareholders will be able, proportionate to their existing shareholding, to claw-back the shares subscribed for by Silverlands ( the Claw-Back Offer ). Depending on the results of the Claw-Back Offer, Silverlands total shareholding of voting securities in Crookes Brothers may equal or exceed 35%. In terms of section 123 of the Companies Act, No 71 of 2008 ( the Act ) and the Takeover Regulations issued pursuant thereto ( the Regulations ), Silverlands would, if its total shareholding of voting securities in Crookes Brothers were to equal or exceed 35%, be obligated to make a mandatory offer to all of the other Crookes Brothers shareholders to acquire their shares at the issue price applicable to the Silverlands Share Issue and the Claw-Back Offer unless granted a waiver from such obligation in terms of Takeover Regulation 86(4) ( the Waiver ). In order to propose and obtain the Waiver from Crookes Brothers shareholders, regulation 86(7) requires that a fair and reasonable opinion be obtained. The board of directors of Crookes Brothers ( the Board ) has requested Grindrod Bank Limited ( Grindrod Bank ) to act as independent expert in terms of the Act and the Regulations and to provide an opinion as to whether the terms and conditions of the Silverlands Share Issue are fair and reasonable as far as Crookes Brothers shareholders are concerned, and by extension, whether the granting of the Waiver is fair and reasonable to Crookes Brothers shareholders. This opinion and the results of our work will be used by the Board solely to satisfy the requirements of the Act and the Regulations. 2. DEFINITION OF FAIR AND REASONABLE The term fair is primarily based on the quantitative issues. The Silverlands Share Issue would be considered to be fair if the consideration per share to be received by Crookes Brothers is equal to or greater than the fair value of a Crookes Brothers share. The term reasonable is generally based on qualitative considerations surrounding a transaction. Hence, the Silverlands Share Issue may be considered to be reasonable, even if the consideration per share to be received by Crookes Brothers was less than the fair value of a Crookes Brothers share, after considering the circumstances of the Silverlands Share Issue and significant qualitative factors. 3. RESPONSIBILITY Compliance with the Act, the Regulations, the JSE Listings Requirements and other regulatory requirements is the responsibility of the Board. Our responsibility is to report on the terms and conditions of the Silverlands Share Issue. 4. SOURCES OF INFORMATION In arriving at our opinion, we have relied upon the following principal sources of information: audited financial statements of Crookes Brothers for the years ended 31 March 2012, 31 March 2013 and 31 March 2014; unaudited interim results of Crookes Brothers for the period ended 30 September 2014; the provisional summary audited group results of Crookes for the year ended 31 March 2015; forecast financial information of Crookes Brothers for the years ending 31 March 2016 to 31 March 2023, as prepared by the management of Crookes Brothers; the terms and conditions of the Silverlands Share Issue as well as the terms and conditions of the obligatory offer agreement entered into between Crookes and Silverlands ( the Obligatory Offer Agreement ); Crookes Brothers latest business and strategic plans; workings and reports in respect of the fair market value of Crookes Brothers agricultural properties; Crookes Brothers plans regarding the commercial and/or residential development of part of its agricultural properties and the details and status of regulatory approvals required to proceed with the commercial and/or residential development of these agricultural properties; discussions with the management of Crookes Brothers; on-line databases covering financial markets, share prices, volumes traded and news; and selected publicly available information relating to Crookes Brothers and the sector in which it operates. 14