VENTURE CORPORATION LIMITED (Incorporated in the Republic of Singapore) Company Registration Number: H

Transcription

1 CIRCULAR DATED 6 APRIL 2011 THIS CIRCULAR IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION. If you are in any doubt as to the course of action you should take, you should consult your stockbroker, bank manager, solicitor, accountant or other professional adviser immediately. If you have sold your ordinary shares in the capital of Venture Corporation Limited, you should immediately forward this Circular and the Proxy Form attached to this Circular to the purchaser or transferee, or the bank, stockbroker or other agent through whom the sale or transfer was effected for onward transmission to the purchaser or transferee. The Singapore Exchange Securities Trading Limited assumes no responsibility for the accuracy of any statements made or opinions expressed in this Circular. VENTURE CORPORATION LIMITED (Incorporated in the Republic of Singapore) Company Registration Number: H CIRCULAR TO SHAREHOLDERS IN RELATION TO 1. THE PROPOSED ADOPTION OF THE VENTURE CORPORATION RESTRICTED SHARE PLAN 2. THE PROPOSED RENEWAL OF THE SHARE PURCHASE MANDATE IMPORTANT DATES AND TIMES: Last date and time for lodgement of Proxy Form : 26 April 2011 at p.m. Date and time of Extraordinary General Meeting : 28 April 2011 at p.m. (or as soon thereafter following the conclusion or adjournment of the Annual General Meeting of the Company to be held at a.m. on the same day and at the same place) Place of Extraordinary General Meeting : 5006 Ang Mo Kio Ave 5 #05-01/12 TECHplace II Singapore

2 CONTENTS Page DEFINITIONS INTRODUCTION THE PROPOSED ADOPTION OF THE VENTURE CORPORATION RESTRICTED SHARE PLAN THE PROPOSED RENEWAL OF THE SHARE PURCHASE MANDATE INTERESTS OF DIRECTORS AND/OR SUBSTANTIAL SHAREHOLDERS DIRECTORS RECOMMENDATIONS EXTRAORDINARY GENERAL MEETING ACTION TO BE TAKEN BY SHAREHOLDERS DIRECTORS RESPONSIBILITY STATEMENT DOCUMENTS AVAILABLE FOR INSPECTION NOTICE OF EXTRAORDINARY GENERAL MEETING PROXY FORM 2

3 DEFINITIONS In this Circular, the following definitions apply throughout unless otherwise stated: Articles : The Articles of Association of the Company. Associate : As defined in the Listing Manual i.e. it refers to: in relation to any Director, chief executive officer, substantial Shareholder or Controlling Shareholder (being an individual) means: (i) (ii) (iii) his immediate family; the trustees of any trust of which he or his immediate family is a beneficiary or, in the case of a discretionary trust, is a discretionary trust object; and any company in which he and his immediate family together (directly or indirectly) have an interest of 30% or more; in relation to a substantial Shareholder or a Controlling Shareholder (being a company) means any other company which is its subsidiary or holding company or is a subsidiary of such holding company or one in the equity of which it and/or such other company or companies taken together (directly or indirectly) have an interest of 30% or more. Award : An award of Shares under the Venture Corporation Restricted Share Plan. Board : The board of Directors of the Company as at the date of this Circular. CDP : The Central Depository (Pte) Limited Circular : The Company s circular to Shareholders dated 1 April Circular : This circular to Shareholders dated 6 April 2011 issued by the Company. Committee : A committee comprising Directors who are duly authorised and appointed by the Board to administer the Venture ESOS and the Venture Corporation Restricted Share Plan. Company : Venture Corporation Limited. Companies Act : The Companies Act, Chapter 50 of Singapore. Control : The capacity to dominate decision-making, directly or indirectly, in relation to the financial and operating policies of a company. 3

4 DEFINITIONS Controlling Shareholder : a person who: holds directly or indirectly 15% or more of the total number of issued Shares excluding treasury Shares in the Company. The SGX-ST may determine that a person who satisfies this paragraph is not a controlling shareholder; or in fact exercises Control over the Company, (or such other definition of Controlling Shareholder as may be adopted from the Listing Manual). Directors : The directors of the Company as at the date of this Circular EGM : The extraordinary general meeting of the Company held on 23 April EGM : The extraordinary general meeting of the Company to be held on 28 April 2011 at p.m., notice of which is set out on pages 28 to 31 of this Circular. EPS : Earnings per Share. ESOS Participant : A person who has been granted an Option. FRS 102 : Shall have the meaning ascribed to it in paragraph of this Circular. Group : The Company and its subsidiaries. Group Executive Director : A director from time to time of the Company and/or any of its subsidiaries, as the case may be, who performs an executive function. Latest Practicable Date : 8 March 2011, being the latest practicable date prior to the printing of this Circular. Listing Manual : The Listing Manual of the SGX-ST as amended, modified or supplemented from time to time. Market Day : A day on which the SGX-ST is open for trading in securities. Maximum Price : The maximum price to be paid for Shares as determined by the Directors under paragraph of this Circular. Memorandum : The Memorandum of Association of the Company. NAV : Net asset value. New Shares : The new Shares which may be allotted and issued from time to time pursuant to the exercise of Options granted under the Venture ESOS and/or pursuant to the release of Awards granted under the Venture Corporation Restricted Share Plan. NTA : Net tangible assets. Options : The right to subscribe for Shares granted or to be granted pursuant to the Venture ESOS. 4

5 DEFINITIONS Participant : A person who has been selected by the Committee to participate in the Venture Corporation Restricted Share Plan in accordance with the rules of the Venture Corporation Restricted Share Plan. Proxy Form : The proxy form in respect of the EGM. Securities Accounts : Securities accounts maintained by Depositors with CDP, but not including securities sub-accounts maintained with a Depository Agent. SGX-ST : Singapore Exchange Securities Trading Limited. Shareholders : Registered holders of Shares except that where the registered holder is CDP, the term Shareholders shall, where the context admits, mean the Depositors who have Shares entered against their names in the Depository Register. Shares : Ordinary shares in the capital of the Company. Share Purchase Mandate : The mandate to enable the Company to purchase or otherwise acquire its issued Shares. SIC : The Securities Industry Council. S$, $ and cents : Singapore dollars and cents, respectively. Take-over Code : The Singapore Code on Take-overs and Mergers. Venture Corporation : The Venture Corporation Restricted Share Plan to be proposed at Restricted Share Plan the EGM. Venture ESOS : The Venture Corporation Executives Share Option Scheme 2004 adopted by the Company on 30 April % or per cent : Per centum or percentage. The terms Depositor, Depository Agent and Depository Register shall have the meanings ascribed to them respectively in Section 130A of the Companies Act. The terms subsidiary and substantial Shareholder shall have the meanings ascribed to them in Sections 5 and 81 of the Companies Act respectively. Words importing the singular shall, where applicable, include the plural and vice versa, and words importing the masculine gender shall, where applicable, include the feminine and neuter genders. References to persons shall include corporations. Any reference to any enactment is a reference to that enactment as for the time being amended or reenacted. Any word defined under the Companies Act or the Listing Manual or any modification thereof and used in this Circular shall, where applicable, have the meaning assigned to it under the Companies Act or the Listing Manual or such modification thereof, as the case may be. The headings in this Circular are inserted for convenience only and shall be ignored in construing this Circular. Any reference to a time of day and date in this Circular shall be a reference to Singapore time and date, unless otherwise stated. 5

6 VENTURE CORPORATION LIMITED (Incorporated in the Republic of Singapore) Company Registration Number: H Directors: Registered Office: Wong Ngit Liong (Chairman & Chief Executive Officer) 5006 Ang Mo Kio Ave 5 Cecil Vivian Richard Wong (Non-Executive Independent Director) #05-01/12 TECHplace II Koh Lee Boon (Non-Executive Independent Director) Singapore Goon Kok Loon (Non-Executive Independent Director) Koh Kheng Siong (Non-Executive Independent Director) Wong Yew Meng (Non-Executive Independent Director) Tan Choon Huat (Executive Director) Soo Eng Hiong (Executive Director) 6 April 2011 To: The Shareholders of Venture Corporation Limited Dear Sir/Madam (1) THE PROPOSED ADOPTION OF THE VENTURE CORPORATION RESTRICTED SHARE PLAN; AND (2) THE PROPOSED RENEWAL OF THE SHARE PURCHASE MANDATE 1. INTRODUCTION The Directors are convening an EGM to be held on 28 April 2011 to seek the approval of Shareholders for the following: 1.1 the proposed adoption of the Venture Corporation Restricted Share Plan; and 1.2 the proposed renewal of the Share Purchase Mandate. The purpose of this Circular is to provide Shareholders with information relating to, and to seek Shareholders approval for the proposals to be tabled at the EGM. The SGX-ST assumes no responsibility for the correctness of any of the statements made or opinions expressed in this Circular. 2. THE PROPOSED ADOPTION OF THE VENTURE CORPORATION RESTRICTED SHARE PLAN 2.1 Rationale for the Venture Corporation Restricted Share Plan The Group has been pursuing innovation and technical competencies, building depth and density in engineering and R&D (Research and Development), as well as manufacturing operations and processes - to create distinct differentiators in its technology services, products and solutions offerings. It is expanding its capabilities, enhancing its operational excellence, growing its technology and enlarging its network of market access. It will continue in this strategic direction taking advantage of its diversity in product portfolio, technology services offering and customer base. 6

7 The Directors are proposing to implement the Venture Corporation Restricted Share Plan in line with the focus of the Group in pursuing quality growth. The Venture Corporation Restricted Share Plan is to encourage sustained commitment from key leaders to grow shareholder value over a long period of time through a sense of ownership in the Company. This Venture Corporation Restricted Share Plan will also align the interests of key leaders as stakeholders of the Company. 2.2 Background of the Venture ESOS The Company has an existing share option scheme, the Venture ESOS, which was adopted at an extraordinary general meeting of the Company, held on 30 April 2004, and will expire in The rules of the Venture Corporation Executives Share Option Scheme 2004 are set out in Appendix 2 to the circular to Shareholders issued by the Company on 5 April As at the Latest Practicable Date, there are 827 ESOS Participants under the Venture ESOS and Options granted thereunder for 17,326,000 Shares. A total of 103,000 Shares have been allotted and issued pursuant to the exercise of the Options under the Venture ESOS, and there remains outstanding and unexercised Options for an aggregate of 12,875,000 Shares (after taking into account the lapsing of Options for 4,348,000 Shares). Accordingly, as at the Latest Practicable Date, the aggregate of Shares comprised in outstanding Options under the Venture ESOS and Shares allotted and issued pursuant to the exercise of Options under the Venture ESOS as a percentage of the existing share capital of the Company is approximately 4.7%. As at the Latest Practicable Date, details of the Options granted to Directors and employees of the Group under the Venture ESOS are as follows: ESOS Participant Aggregate Options Aggregate Options Aggregate Options granted exercised outstanding Directors Wong Ngit Liong 316, ,000 Tan Choon Huat 264, ,000 Soo Eng Hiong 264, ,000 Employees 16,482, ,000 12,103,000 Except as disclosed in the rules of the Venture ESOS, there are no material conditions to which the Options are subject to. 2.3 Venture Corporation Restricted Share Plan as compared to Venture ESOS It is intended that the Venture ESOS and the Venture Corporation Restricted Share Plan will complement each other in the Company s continuing efforts to reward, retain and motivate employees to achieve outstanding performance. The Venture ESOS, as stated in the Circular to Shareholders dated 5 April 2004 is extended to a broader group of employees with the aim inter alia, of motivating these employees to optimise their performance standards and efficiency to maintain a high level of contribution to the Group. Under the Venture ESOS, Options may be granted to employees subject to conditions specified by the Committee. The Options are exercisable in accordance with a vesting schedule and the payment of the subscription price. The proposed Venture Corporation Restricted Share Plan, on the other hand, contemplates the award of fully paid-up Shares to managers in senior or leadership positions in the Group as stated in paragraph below, as recognition for these Participants contributions and performance or upon these Participants having achieved performance and/or service conditions, or having made significant contributions to the Group. 7

8 Awards under the Venture Corporation Restricted Share Plan may be granted to Participants with vesting period(s) to encourage Participants to continue serving the Group for a further period of time. Retention periods, during which a proportion of the Shares may not be transferred or otherwise disposed of (except to the extent set out in the Award letter or with the prior approval of the Committee), may also be imposed in respect of Shares which have been allotted and issued to Participants pursuant to Awards granted under the Venture Corporation Restricted Share Plan in order to encourage the alignment of the interests of the Participants with the interests of Shareholders. 2.4 Rules of the Venture Corporation Restricted Share Plan A copy of the rules of the Venture Corporation Restricted Share Plan may be inspected at the registered office of the Company at 5006 Ang Mo Kio Ave 5 #05-01/12 TECHplace II Singapore , during normal office hours on any weekday (public holidays excepted) from the date of this Circular up to and including the date of the EGM. A summary of the principal rules of the Venture Corporation Restricted Share Plan is set out in paragraph 2.5 of this Circular. 2.5 Summary of rules of the Venture Corporation Restricted Share Plan Eligibility and Participation Subject to the Companies Act and requirements of the SGX-ST, managers in senior positions in the Group or leadership positions in management, technology or possess other domain expertise and competencies and who are in a position to contribute or have significantly contributed to the performance, growth and profitability of the Group, as may be designated by the Committee, shall be eligible to participate in the Venture Corporation Restricted Share Plan. Such managers must have been employed in the Company and/or its subsidiaries for a minimum period of years as determined by the Committee. The terms of employment or appointment of a Participant shall not be affected by his participation in the Venture Corporation Restricted Share Plan, which shall neither form part of such terms nor entitle him to take into account such participation in calculating any compensation or damages on the termination of his employment or appointment for any reason. Subject to the Companies Act and requirements of the SGX-ST, the Controlling Shareholders and their Associates who meet the criteria as set out above are eligible to participate in the Venture Corporation Restricted Share Plan, provided that the participation of each Controlling Shareholder or its Associate and each grant of an Award of Shares to any of them may only be effected with the specific prior approval of independent Shareholders in general meeting by a separate resolution except where the Controlling Shareholder is, at the relevant time, already a Participant. There shall be no restriction on the eligibility of any Participant to participate in any other share option or share incentive schemes implemented or to be implemented by the Company and/or another company within the Group. Group Executive Directors are eligible to participate in the Venture Corporation Restricted Share Plan whereas non-executive Directors shall not be eligible to participate. Subject to the Companies Act and requirements of the SGX-ST, the terms of eligibility of any Participant in the Venture Corporation Restricted Share Plan may be amended from time to time by the Committee. 8

9 2.5.2 Awards A Participant may be granted an Award, which represents the right to receive fully-paid Shares, their equivalent cash value or combinations thereof, free of charge, upon the Committee s determination that the Participant has made contributions to business growth of the Group and that his performance over a period of time should be recognised. A Participant may also be granted an Award, which represents the right to receive fully-paid Shares, their equivalent cash value or combinations thereof, free of charge, upon the Committee s determination that the Participant has achieved pre-determined performance conditions and/or service conditions over a period of time. Awards under the Venture Corporation Restricted Share Plan may be granted to Participants with vesting periods to encourage Participants to continue serving the Group for a further period of time. Retention periods, during which a proportion of the Shares may not be transferred or otherwise disposed of (except to the extent set out in the Award letter or with the prior approval of the Committee), may also be imposed in respect of the Shares which have been allotted and issued to Participants pursuant to Awards granted under the Venture Corporation Restricted Share Plan in order to encourage the alignment of the interests of the Participants with the interests of Shareholders. Awards are personal to the Participant to whom they are given and shall not be transferred, charged, assigned, pledged or otherwise disposed of or encumbered, in whole or in part, unless the prior approval of the Committee is obtained Details of Awards The Committee shall decide, in relation to each Award of Shares to a Participant under the Venture Corporation Restricted Share Plan, the following: (c) (d) (e) (f) (g) (h) the date on which the Award is to be granted; the number of Shares which are the subject of the Award; the performance conditions and/or service conditions and/or any other basis on which the Award is to be granted; the performance period(s) and/or vesting period(s) (if any); the extent to which Shares which are the subject of that Award shall be vested at the end of each vesting period (if any) or on the performance conditions and/or service conditions, if any, being satisfied (whether fully or partially) or exceeded or not being satisfied, as the case may be; the release schedule (if any); the retention period(s); and any other condition which the Committee may determine in relation to that Award. 9

10 2.5.4 Events Prior to Vesting Where the Award is subject to a vesting period, special provisions for the vesting and lapsing of Awards apply in certain circumstances, including the following: (c) (d) in the event of misconduct on the part of a Participant as determined by the Committee in its discretion; the Participant ceasing to be in the employment of the Group for any reason whatsoever (other than specified in paragraph (d) below); the bankruptcy of a Participant, his entering into any composition with his creditors prior to the vesting of his Award or the happening of any other event which results in his being deprived of the legal or beneficial ownership of the Award; the Participant ceasing to be in the employment of the Group by reason of: (i) (ii) (iii) (iv) (v) (vi) (vii) ill health, injury, accident or disability (in each case, evidenced to the satisfaction of the Committee); redundancy; retirement at or after the legal retirement age; retirement before the legal retirement age with the consent of the Committee; the company by which he is employed ceasing to be a company within the Group or part of the undertaking of such company being transferred otherwise than to another company within the Group; transfer to any corporation at the discretion of the Company; or any other event approved by the Committee; (e) (f) (g) the death of the Participant; a take-over offer (whether conditional or unconditional) being made for all or any part of the Shares, a scheme of arrangement or compromise between the Company and its Shareholders being sanctioned by the court under the Companies Act, an order for the compulsory winding-up of the Company is made or a resolution for a voluntary winding up of the Company being made; or any other event approved by the Committee. Upon the occurrence of any of the events specified in paragraphs and above, an Award then held by a Participant shall, save as otherwise provided in the rules of the Venture Corporation Restricted Share Plan and to the extent not yet released, immediately lapse without any claim whatsoever against the Company and/or its Directors. Upon the occurrence of any of the events specified in paragraphs (c), (d) and (g) above, the Committee may consider, at its absolute discretion and on such terms and conditions as it deems fit, whether or not to preserve all or any part of any Award and decide as soon as reasonably practicable following such event to release any Award and vest some or all of the Shares which are the subject of the Award or to preserve all or part of any Award until the end of the relevant prescribed vesting period (if any), and/or to waive or reduce any or all of the prescribed retention period(s) or to declare that an Award has lapsed without any claim whatsoever against the Company and/or its Directors. In exercising its discretion, the Committee will take into account all circumstances on a case-by-case basis, 10

11 including (but not limited to) the contributions made by that Participant and the extent to which the applicable performance conditions and/or service conditions, if any, have been satisfied. Upon the occurrence of the event specified in paragraph (e) above, the Committee will consider, at its discretion and on such terms and conditions as it deems fit, whether or not to release any Award and vest some or all the Shares which are the subject of such Award in the personal representative(s) of the Participant, and/or to waive any or all of the prescribed retention period(s) or to declare that an Award has lapsed without any claim whatsoever against the Company and/or its Directors. In exercising its discretion, the Committee will take into account all circumstances on a case-by-case basis, including (but not limited to) the contributions made by the Participant and the extent to which the applicable performance conditions and/or service conditions, if any, have been satisfied. Upon the occurrence of any of the events specified in paragraph (f) above, the Committee will consider, at its discretion and on such terms and conditions as it deems fit, whether or not to release any Award, or to waive or reduce any or all of the prescribed retention period(s) and will take into account all circumstances on a case-by-case basis, including (but not limited to) the contributions made by that Participant and the extent to which the applicable performance conditions and/or service conditions, if any, have been satisfied Operation of the Venture Corporation Restricted Share Plan Subject to the prevailing legislation and the Listing Rules, the Company will have the flexibility and discretion in determining the mode of settlement of the Awards by way of: (c) (d) an allotment and issue of New Shares; and/or the delivery of existing Shares; and/or payment of the Equivalent Value in Cash (after deduction of any applicable taxes and Central Provident Fund and/or other statutory contributions); and/or a combination of above, and (c). In determining whether to issue New Shares or to deliver existing Shares or to pay the Equivalent Value in Cash to Participants upon vesting of their Awards, the Company will take into account factors such as (but not limited to) the amount of cash available, the number of Shares to be delivered, the prevailing market price of the Shares and the cost to the Company of the various modes of settlement. The financial effects of the above methods are discussed in paragraph 2.7 of this Circular. The Committee has the discretion to determine whether performance conditions and/or service conditions have been satisfied (whether fully or partially) or exceeded and/or whether the Participant s performance and/or contribution to the Company justifies making an Award or the vesting of an Award. The Committee may make computational adjustments to the audited results of the Company or the Group, as the case may be, to take into account such factors as the Committee may determine to be relevant, including changes in accounting methods, taxes and extraordinary events and further, the right to amend the performance conditions and/or service conditions, if any, if the Committee decides that it would be more equitable to do so. New Shares allotted and issued, and existing Shares procured by the Company for transfer shall, on the release of an Award, rank in full for all entitlements, including dividends or other distributions declared or recommended in respect of the then existing Shares, the record date for which is on or after the relevant vesting date, and shall in all other respects rank pari passu with other existing Shares then in issue. 11

12 New Shares to be issued under the Venture Corporation Restricted Share Plan shall be issued in compliance with all applicable laws and regulations. Subject to applicable laws, the Company may also either purchase or procure the purchase of existing Shares to satisfy Awards. Where New Shares are allotted upon the vesting of an Award, the Company shall, as soon as practicable after such allotment, apply to the SGX-ST for permission to deal in and for quotation of such Shares if such permission has not been obtained prior to the allotment. Notwithstanding any provisions herein contained, the Directors, the Committee and the Company shall not under any circumstances be held liable for any costs, losses, expenses and damages whatsoever and howsoever arising in any event, including but not limited to the Company s delay in issuing the Shares or applying for or procuring the listing of the New Shares on the SGX-ST in accordance with the Venture Corporation Restricted Share Plan. Every Award shall be subject to the condition that no cash shall be paid nor Shares issued or transferred pursuant to the release of any Award if such payment, issue or transfer would be contrary to any law or enactment, or any rules or regulations of any legislative or non-legislative governing body for the time being in force in Singapore or any other relevant country having jurisdiction in relation to the payment of cash or issue or transfer of Shares thereto. The Equivalent Value in Cash to be paid to a Participant in lieu of all or part of the Shares to be issued or delivered upon the release of an Award, shall be calculated in accordance with the following formula: A = B x C Where: A is the Equivalent Value in Cash in Singapore Dollars to be paid to the Participant in lieu of all or some of the Shares to be issued or delivered upon the release of an Award; B is equal to the volume weighted average of a Share, as determined by reference to the daily official list or other publication published by the SGX-ST for the last three Market Days immediately preceding the relevant vesting date; and C is such number of Shares (as determined by the Committee in its sole and absolute discretion) in respect of which cash will be paid to a Participant in lieu of Shares to be issued or delivered to the Participant upon the release of an Award Size The aggregate number of New Shares which may be issued and existing Shares which may be delivered (whether such existing Shares are acquired, pursuant to a share purchase mandate or (to the extent permitted by law) held as treasury shares, or otherwise) pursuant to Awards granted on any date: when added to the number of New Shares issued and issuable and existing Shares delivered and deliverable in respect of all Awards granted under the Venture Corporation Restricted Share Plan, shall not exceed three per cent (3%) of the total number of issued Shares (excluding Shares held in treasury) from time to time; and 12

13 when added to the number of New Shares issued and issuable and existing Shares delivered and deliverable in respect of (i) all Awards granted under the Venture Corporation Restricted Share Plan; and (ii) all Options granted and outstanding under the Venture ESOS, shall not exceed 15% of the total number of issued Shares (excluding Shares held in treasury) on the day preceding the relevant date of grant, where the relevant date of grant falls on or prior to 30 April The aggregate number of New Shares which may be issued and existing Shares which may be delivered (whether such existing Shares are acquired, pursuant to a share purchase mandate or (to the extent permitted by law) held as treasury shares, or otherwise) pursuant to Awards granted under the Venture Corporation Restricted Share Plan in any financial year, on any date, shall not exceed one quarter of the limit specified in paragraph above Duration The Venture Corporation Restricted Share Plan shall continue in force at the discretion of the Committee, subject to a maximum period of 10 years commencing on the date on which the Venture Corporation Restricted Share Plan is adopted by the Company at the EGM, provided always that the Venture Corporation Restricted Share Plan may, subject to applicable laws and regulations, continue beyond the above stipulated period with the approval of Shareholders by ordinary resolution in general meeting and of any relevant authorities which may then be required. Termination or expiry of the Venture Corporation Restricted Share Plan shall not affect Awards which have been granted prior to such termination or expiry which will continue to remain valid Adjustment Events If a variation in the issued ordinary share capital of the Company (whether by way of a capitalisation of profits or reserves or rights issue, reduction, subdivision, consolidation, distribution or otherwise) shall take place, then: the class and/or number of Shares which are the subject of an Award to the extent not yet vested; and/or the class and/or number of Shares in respect of which future Awards may be granted under the Venture Corporation Restricted Share Plan, shall be adjusted in such manner as the Committee may determine to be appropriate, provided that no adjustment shall be made if as a result, the Participant receives a benefit that a Shareholder does not receive. Unless the Committee considers an adjustment to be appropriate, the issue of securities as consideration for an acquisition or a private placement of securities, or the cancellation of issued Shares purchased or acquired by the Company by way of a market purchase of such Shares undertaken by the Company on the SGX-ST during the period when a share purchase mandate granted by Shareholders of the Company (including any renewal of such mandate) is in force, shall not normally be regarded as a circumstance requiring adjustment. Any adjustment (except in relation to a capitalisation issue) must be confirmed in writing by the Auditors (acting only as experts and not as arbitrators) to be in their opinion, fair and reasonable, and the adjustment must be made in such a way that a Participant will not receive a benefit that a Shareholder does not receive. 13

14 Upon any adjustment required to be made pursuant to the Venture Corporation Restricted Share Plan, the Company shall notify the Participant (or his duly appointed personal representatives where applicable) in writing and deliver to him (or his duly appointed personal representatives where applicable) a statement setting forth the class and/or number of Shares thereafter to be issued or transferred on the vesting of an Award. Any adjustment shall take effect upon such written notification being given Modifications to the Venture Corporation Restricted Share Plan Any or all the provisions of the Venture Corporation Restricted Share Plan may be modified and/or altered at any time and from time to time by resolution of the Committee, except that: (c) no modification or alteration shall be made which would adversely affect the rights attached to any Award granted prior to such modification or alteration except with the prior consent in writing of such number of Participants who, if their Awards were released to them upon the expiry of all the vesting periods applicable to their Awards, would be entitled to not less than 75% of the aggregate number of the Shares which would fall to be vested upon the release of all outstanding Awards upon the expiry of all the vesting periods applicable to all such outstanding Awards, provided that any such modification or alteration shall be made in such a way that a Participant will not receive a benefit that a Shareholder does not receive; no modification or alteration to particular rules of the Venture Corporation Restricted Share Plan to the advantage of Participants shall be made except with the prior approval of the Shareholders of the Company in general meeting; and no modification or alteration shall be made without the prior approval of the SGX-ST and such other regulatory authorities as may be necessary. The opinion of the Committee as to whether any modification or alteration would adversely affect the rights attached to any Award shall be final, binding and conclusive. The Committee may at any time by resolution (and without other formality, save for the prior approval of the SGX-ST, as applicable) amend or alter the Venture Corporation Restricted Share Plan in any way to the extent necessary to cause the Venture Corporation Restricted Share Plan to comply with, or as otherwise may be permitted in accordance with or take into account, any law or enactment or any rules, regulations or guidelines of any regulatory or other relevant authority or body (including, without limitation, the SGX-ST) for the time being in force. Written notice of any modification or alteration made in accordance with the above shall be given to all Participants but omission to give notice to any Participant(s) shall not invalidate any such modifications or alterations. 2.6 Role and Composition of the Committee The Venture Corporation Restricted Share Plan will be administered by the Remuneration Committee which currently comprises Mr Koh Lee Boon, Mr Cecil Vivian Richard Wong, Mr Goon Kok Loon and Mr Koh Kheng Siong, all of whom are non-executive independent Directors. The Committee shall have such powers and duties as are conferred on it by the Board of Directors, provided that no member of the Committee shall participate in any deliberation or decision in respect of Awards to be granted to or held by him. 14

15 2.7 Financial Effects of the Venture Corporation Restricted Share Plan Potential Cost of Awards The proposed Venture Corporation Restricted Share Plan is considered a share-based payment that falls under the scope of Financial Reporting Standard 102, Share-based payment ( FRS 102 ). Participants may receive Shares or their equivalent cash value, or combinations thereof. The Awards would be accounted for as equity-settled share-based transactions, as described in the following paragraphs. The fair value of employee services received in exchange for the grant of the Awards would be recognised as a charge to the income statement over the period between the grant date and the vesting date of an Award. The total amount of the charge over the vesting period (if any) is determined by reference to the fair value of each Award granted at the grant date and the number of Shares vested at the vesting date, with a corresponding credit to reserve account. Before the end of the vesting period (if any), at each accounting year end, the estimate of the number of Awards that are expected to vest by the vesting date is revised, and the impact of the revised estimate is recognised in the income statement with a corresponding adjustment to the reserve account. After the vesting date, no adjustment to the charge to the income statement is made. The amount charged to the income statement also depends on whether or not the performance condition attached to an Award is measured by reference to the market price of the Shares. This is known as a market condition. If the performance condition is a market condition, the probability of the performance condition being met is taken into account in estimating the fair value of the Award granted at the grant date, and no adjustments to the amounts charged to the income statement are made whether or not the market condition is met. However, if the performance condition is not a market condition, the fair value per Share of the Awards granted at the grant date is used to compute the amount to be charged to the income statement at each accounting date, based on an assessment at that date of whether the non-market conditions would be met to enable the Awards to vest. Thus, where the vesting conditions do not include a market condition, there would be no cumulative charge to the income statement if the Awards do not ultimately vest Share Capital The proposed Venture Corporation Restricted Share Plan will result in an increase in the Company s issued Shares only if New Shares are issued to Participants. The number of New Shares issued will depend, inter alia, on the size of the Awards granted under the proposed Venture Corporation Restricted Share Plan. In any case, the proposed Venture Corporation Restricted Share Plan provides that: when added to the number of New Shares issued and issuable and existing Shares delivered and deliverable in respect of all Awards granted under the Venture Corporation Restricted Share Plan, shall not exceed three per cent (3%) of the total number of issued Shares (excluding Shares held in treasury) from time to time; and when added to the number of New Shares issued and issuable and existing Shares delivered and deliverable in respect of (i) all Awards granted under the Venture Corporation Restricted Share Plan; and (ii) all Options granted and outstanding under the Venture ESOS, shall not exceed 15% of the total number of issued Shares (excluding Shares held in treasury) on the day preceding the relevant date of grant, where the relevant date of grant falls on or prior to 30 April If instead of issuing New Shares to Participants, existing Shares are purchased for delivery to Participants or if treasury shares are transferred and delivered to Participants, the Venture Corporation Restricted Share Plan will have no impact on the Company s issued share capital. 15

16 2.7.3 NTA The proposed Venture Corporation Restricted Share Plan is likely to result in a change to the Company s income statement over the period from the grant date to the vesting date of the Awards. The amount of the change will be computed in accordance with FRS 102. When New Shares are issued under the proposed Venture Corporation Restricted Share Plan, there would be no effect on the NTA. However, if instead of issuing New Shares to Participants, existing Shares are purchased for delivery to the Participants, the NTA would be impacted by the cost of the Shares purchased. It should be noted that the delivery of Shares to Participants under the proposed Venture Corporation Restricted Share Plan will generally be contingent upon the Participants meeting prescribed performance conditions and/or service conditions or being recognised as having performed and made contributions to the Group or such other conditions, if any EPS The proposed Venture Corporation Restricted Share Plan is likely to result in a change to earnings over the period from the grant date to the vesting date, computed in accordance with FRS 102. It should again be noted that the delivery of Shares to Participants under the proposed Venture Corporation Restricted Share Plan will generally be contingent upon the Participants meeting prescribed performance conditions and/or service conditions or being recognised as having performed and made contributions to the Group or such other conditions, if any Dilutive Impact It is expected that the dilutive impact of the proposed Venture Corporation Restricted Share Plan on the NTA per Share and EPS will not be significant. 2.8 SGX-ST In-Principle Approval The SGX-ST has granted approval in-principle for the listing and quotation of the New Shares to be allotted and issued, where applicable, pursuant to the Venture Corporation Restricted Share Plan, subject to, inter alia, Shareholders approval being obtained for the Venture Corporation Restricted Share Plan. The approval in-principle of the SGX-ST for the listing and quotation of the New Shares to be allotted and issued, where applicable, pursuant to the Venture Corporation Restricted Share Plan, on the Official List of the SGX-ST shall not be taken as an indication of the merits of the Company, the Group, the Shares, the Venture Corporation Restricted Share Plan or the New Shares. 3. THE PROPOSED RENEWAL OF THE SHARE PURCHASE MANDATE 3.1 Introduction. Shareholders had approved the renewal of the Share Purchase Mandate at the 2010 EGM. The authority and limitations on the Share Purchase Mandate were set out in the 2010 Circular and Ordinary Resolution 1 set out in the Notice of the 2010 EGM. The Share Purchase Mandate was expressed to take effect on the date of the passing of Ordinary Resolution 1 at the 2010 EGM and will expire on the date of the forthcoming Annual General Meeting to be held on 28 April Accordingly, Shareholders approval is being sought for the renewal of the Share Purchase Mandate at the EGM, immediately following the Annual General Meeting of the Company convened to be held on the same date. As at the Latest Practicable Date, the Company had not purchased or acquired any Shares pursuant to the Share Purchase Mandate approved by Shareholders at the 2010 EGM. 16

17 3.2 Rationale for the Share Purchase Mandate. The rationale for the Company to undertake the purchase or acquisition of its Shares are as follows: (c) in managing its business, the Group always strives to increase shareholder value by improving, inter alia, the return on equity of the Group ( ROE ) and a share purchase is one way by which ROE may be enhanced; the Share Purchase Mandate will give the Company the flexibility to undertake purchases or acquisitions of its Shares at any time, subject to market conditions, during the period that the Share Purchase Mandate is in force; and in line with international practice, the Share Purchase Mandate will give the Company greater flexibility over management of capital and maximising returns to Shareholders. In particular, the Share Purchase Mandate will facilitate the return of funds, which are in excess of the Company s financial and investment needs, to Shareholders in an expedient and cost-efficient manner. It should be noted that the purchase or acquisition of Shares pursuant to the Share Purchase Mandate will only be undertaken if it benefits the Company and Shareholders. No purchase or acquisition of Shares will be made in circumstances which would have or may have a material adverse effect on the financial position of the Company and the Group and/or affect the listing status of the Company on the SGX-ST. While the Share Purchase Mandate would authorise a purchase or acquisition of Shares up to the said 10 per cent. limit described in paragraph below, Shareholders should note that purchases or acquisitions of Shares pursuant to the Share Purchase Mandate may not be carried out to the full 10 per cent. limit as authorised and no purchases or acquisitions of Shares would be made in circumstances which would have or may have a material adverse effect on the financial position of the Group as a whole. 3.3 Authority and Limits of the Share Purchase Mandate. The authority and limitations placed on the Share Purchase Mandate, if renewed at the EGM are the same as previously approved by Shareholders at the 2010 EGM, and are summarised below: Maximum Number of Shares The total number of Shares which may be purchased or acquired by the Company pursuant to the Share Purchase Mandate is limited to that number of Shares representing not more than 10 per cent. of the total number of issued Shares of the Company as at the date of the EGM. Any Shares which are held as treasury shares will be disregarded for purposes of computing the 10 per cent. limit. Purely for illustrative purposes, on the basis of 274,273,577 Shares in issue as at the Latest Practicable Date and assuming no further Shares are issued, on or prior to the EGM, the purchase by the Company of up to the maximum limit of 10 per cent. of its issued Shares will result in the purchase or acquisition of 27,427,357 Shares Duration of Authority Purchases or acquisitions of Shares may be made, at any time and from time to time, on and from the date of the EGM, at which the Share Purchase Mandate is approved, up to: the date on which the next Annual General Meeting of the Company is held or required by law to be held; or the date on which the authority conferred by the Share Purchase Mandate is revoked or varied, whichever is the earlier. 17

18 3.3.3 Manner of Purchases or Acquisitions of Shares Purchases or acquisitions of Shares may be made by way of: on-market purchases ( Market Purchases ), transacted on the SGX-ST through the SGX-ST s trading system, through one or more duly licensed stockbrokers appointed by the Company for the purpose; and/or off-market purchases ( Off-Market Purchases ) effected pursuant to an equal access scheme. The Directors may impose such terms and conditions which are not inconsistent with the Share Purchase Mandate, the Listing Manual and the Companies Act as they consider fit in the interests of the Company in connection with or in relation to any equal access scheme or schemes. An Off-Market Purchase must, however, satisfy all the following conditions: (i) (ii) (iii) offers for the purchase or acquisition of Shares shall be made to every person who holds Shares to purchase or acquire the same percentage of their Shares; all of those persons shall be given a reasonable opportunity to accept the offers made; and the terms of all the offers shall be the same, except that there shall be disregarded (1) differences in consideration attributable to the fact that offers may relate to Shares with different accrued dividend entitlements and (2) differences in the offers introduced solely to ensure that each person is left with a whole number of Shares. If the Company wishes to make an Off-Market Purchase in accordance with an equal access scheme, it will issue an offer document containing at least the following information: (1) terms and conditions of the offer; (2) period and procedures for acceptances; and (3) information required under Rules 883(2), (3), (4) and (5) of the Listing Manual Purchase Price The purchase price (excluding brokerage, commission, applicable goods and services tax and other related expenses) to be paid for a Share will be determined by the Directors. The purchase price to be paid for the Shares must not exceed: in the case of a Market Purchase, 105% of the Average Closing Price of the Shares; and in the case of an Off-Market Purchase, 110% of the Average Closing Price of the Shares, in either case, excluding related expenses of the purchase or acquisition. 18

19 For the above purposes: Average Closing Price means the average of the last dealt prices of a Share for the five consecutive Market Days on which the Shares are transacted on the SGX-ST immediately preceding the date of the Market Purchase by the Company, or, as the case may be, the date of the making of the offer pursuant to the Off-Market Purchase, and deemed to be adjusted in accordance with the listing rules of the SGX-ST for any corporate action which occurs after the relevant five-day period; and date of the making of the offer means the date on which the Company makes an offer for the purchase or acquisition of Shares from holders of Shares, stating therein the relevant terms of the equal access scheme for effecting the Off-Market Purchase. 3.4 Status of Purchased Shares. Shares purchased or acquired by the Company are deemed cancelled immediately on purchase or acquisition (and all rights and privileges attached to the Shares will expire on such cancellation) unless such Shares are held by the Company as treasury shares. The total number of issued Shares will be diminished by the number of Shares purchased or acquired by the Company, which are cancelled and are not held as treasury shares. 3.5 Treasury Shares. Under the Companies Act, Shares purchased or acquired by the Company may be held or dealt with as treasury shares. Some of the provisions on treasury shares under the Companies Act are summarised below: Maximum Holdings The number of Shares held as treasury shares cannot at any time exceed 10 per cent. of the total number of issued Shares Voting and Other Rights The Company cannot exercise any right in respect of treasury shares. In particular, the Company cannot exercise any right to attend or vote at meetings and for the purposes of the Companies Act, the Company shall be treated as having no right to vote and the treasury shares shall be treated as having no voting rights. In addition, no dividend may be paid, and no other distribution of the Company s assets may be made, to the Company in respect of treasury shares. However, the allotment of shares as fully paid bonus shares in respect of treasury shares is allowed. A subdivision or consolidation of any treasury share into treasury shares of a smaller amount is also allowed so long as the total value of the treasury shares after the subdivision or consolidation is the same as before Disposal and Cancellation Where Shares are held as treasury shares, the Company may at any time but subject always to the Take-over Code: (c) (d) (e) sell the treasury shares for cash; transfer the treasury shares for the purposes of or pursuant to an employees share scheme; transfer the treasury shares as consideration for the acquisition of shares in or assets of another company or assets of a person; cancel the treasury shares; or sell, transfer or otherwise use the treasury shares for such other purposes as may be prescribed by the Minister for Finance. 19