Stock Exchange Building, Stock Exchange Road, Karachi Seeking Public Comments on. Draft Offer for Sale Document of Liberty Power Tech Limited

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1 IL psk PAKISTAN STOCK EXCHANGE LIMITED Stock Exchange Building, Stock Exchange Road, Karachi UAN: PSX/N-4551 NOTICE July 31, 2017 Seeking Public Comments on Draft Offer for Sale Document of Liberty Power Tech Limited It is hereby informed to all concerned that Liberty Power Tech Limited has applied for Listing on the Exchange and has submitted the draft Offer for Sale Document for offer of shares to High Net-worth Individual / Institutional Investors through Book Building followed by offer of shares of the Company to the General Public / Retail Investors. The draft Offer for Sale Document of the Company is hereby placed on the Website of the Exchange under caption "Public Comments on Draft Offer for Sale Document of Liberty Power Tech Limited" for seeking public comments as required under Section 3 (11) of the Public Offering Regulations, 2017 and the Regulation No (ac) of Listing of Companies and Securities Regulations of PSX. It is requested to submit written comments on the draft Offer for Sale Document, if any, either in hard form or through at comments.draftprospectus@psx.com.pk addressed to the undersigned latest by August 8, Muhammad Ghufran Deputy General Manager - Operations Copy to: 1. The Executive Director (PRDD), SMD, SECP NIC Building, Jinnah Avenue, Blue Area, Islamabad. 2. The Director (Cl), Public Offering & Regulated Persons Department, SECP 3. The Chief Executive Officer, PSX 4. The Chief Executive Officer, CDC 5. The Chief Executive Officer, NCCPL 6. Acting Chief Regulatory Officer - PSX 7. All Head of Departments - PSX 8. PSX Notice Board & Website 9. Liberty Power Tech Limited 10. Arif Habib Limited

2 ADVICE FOR INVESTORS INVESTORS ARE STRONGLY ADVISED IN THEIR OWN INTEREST TO CAREFULLY READ THE CONTENTS OF THIS OFFER FOR SALE DOCUMENT, ESPECIALLY THE RISK FACTORS GIVEN AT PARA 4.9 BEFORE MAKING ANY INVESTMENT DECISION. SUBMISSION OF FALSE AND FICTITOUS APPLICATIONS ARE PROHIBITED AND SUCH APPLICATIONS MONEY MAY BE FORFEITED UNDER SECTION 87(8) OF THE SECURITIES ACT, ADVICE FOR INSTITUTIONAL INVESTORS AND HIGH NET WORTH INDIVIDUAL INVESTORS UNDER REGULATION 10(2)(V) OF THE PUBLIC OFFERING REGULATIONS, 2017, A SINGLE INVESTOR CANNOT SUBMIT MORE THAN ONE BIDDING APPLICATION, EXCEPT IN THE CASE OF UPWARD REVISION OF BID. IF AN INVESTOR SUBMITS MORE THAN ONE BIDDING APPLICATION THEN ALL SUCH APPLICATIONS SHALL BE SUBJECT TO REJECTION. SUBMISSIONS OF CONSOLIDATED BIDS ARE PROHIBITED UNDER 10(2)(IV) OF THE PUBLIC OFFERING REGULATIONS, A BID APPLICATION WHICH IS BENEFICIALLY OWNED (FULLY OR PARTIALLY) BY PERSONS OTHER THAN THE ONE NAMED THEREIN SHALL BE DEEMED TO BE A CONSOLIDATED BID. PLEASE NOTE THAT AS PER THE PUBLIC OFFERING REGULATIONS, 2017, A SUPPLEMENT TO THE OFFER FOR SALE DOCUMENT SHALL BE PUBLISHED WITHIN THREE WORKING DAYS OF THE CLOSING OF THE BIDDING PERIOD WHICH SHALL CONTAIN INFORMATION RELATING TO THE STRIKE PRICE, OFFER PRICE, COMMITMENT BY THE SUCCESFUL BIDDERS FOR SUBSCRIBING THE UNDERSUBSCRIBED RETAIL PORTION AS THE OFFER IS BEING MADE THROUGH HUNDRED PERCENT BOOK BUILDING WITH ALLOCATION TO RETAIL INVESTORS, CATEGORY WISE BREAKUP OF THE SUCCESSFUL BIDDERS ALONG WITH NUMBER OF SHARES ALLOTED TO EACH CATEGORY, DATES OF PUBLIC SUBSCRIPTION AND SUCH OTHER INFORMATION AS SPECIFIED BY THE COMMISSION. THIS IS NOT A PROSPECTUS BY LIBERTY POWER TECH LIMITED BUT AN OFFER FOR SALE BY EXISTING SHAREHOLDERS NAMELY; MR. MUHAMMAD SALIM MUKATY, MRS. HAMIDA SALIM MUKATY, MR. MUHAMMAD ASHRAF, MRS. FARHEEN ASHRAF AND LIBERTY MILLS LIMITED. LIBERTY POWER TECH LIMITED First listing of Shari ah Compliant IPP in Pakistan* OFFER FOR SALE DOCUMENT This Offer consists of 126,146,014 ordinary shares (25% of the total paid up capital of Liberty Power Tech Limited) of face value of PKR 10 each The Offer is being made through the Book Building process at a Floor Price of PKR 40/- per share (including a premium of PKR 30/- per share). The bidders shall be allowed to place bids for one hundred percent (100%) of the offer size and the strike price shall be the price at which one hundred percent (100%) of the offer is subscribed. However, the successful bidders shall be provisionally allotted only seventy-five percent (75%) of the Offer size i.e. 94,609,014 and the remaining twenty five percent (25%) i.e. 31,537,000 shall be offered to the retail investors. In case retail portion of the Offer remains unsubscribed, the unsubscribed shares shall be allotted to the successful bidders on pro rata basis and in case the retail portion of the Offer is oversubscribed, the portion allocated to book building investors at strike price shall be allotted to the retail investors in the manner given in para (Justification of premium is given under Valuation Section in paragraph 2.1) As per the Public Offering Regulations, 2017 and PSX s Listing of Companies and Securities Regulations, the Draft Offer for Sale Document was placed on PSX s website for seeking public comments for seven (7) working days starting from [Month] [Date], 2017 to [Month] [Date], The comments received have been duly incorporated / responded by the Consultant to the Offer. REGISTERATION OF ELIGIBLE INVESTORS: The registration of eligible investors will commence at 9:00 am on DD/MM/2017 and will close at 3:00 pm on DD/MM/2017 BIDDING PERIOD DATES: From DD/MM/2017 to DD/MM/2017 (From: 9:00 am to 5:00 pm) DATE OF PUBLIC SUBSCRIPTION: From DD/MM/2017 to DD/MM/2017 (both days inclusive) CONSULTANT TO THE OFFER BOOK RUNNER Banker to the Book Building portion of the Offer: Summit Bank Limited Bankers for the Retail portion of the Offer: Askari Bank Limited Albaraka Bank Allied Bank Limited Bank Alfalah Limited Bank Al Habib Limited BankIslami Pakistan Limited Dubai Islamic Bank Faysal Bank Limited Habib Bank Limited Habib Metropolitan Bank MCB Bank Limited Meezan Bank Limited Soneri Bank Limited Summit Bank Limited** United Bank Limited** **In order to facilitate investors, United Bank Limited ( UBL ), Summit Bank Limited ( SMBL ) and Bank Alfalah ( BAFL ) are offering electronic submission of application (e-ipo) to their account holders. UBL account holders can use UBL Net Banking to submit their application via link SMBL account holders can use SMBL Net Banking to submit their application via link BAFL account holders can use BAFL Net Banking to submit their applications via link Furthermore, please note that online applications can be submitted 24 hours a day during the subscription period which will close at midnight on DD/MM/2017. Summit Bank is also Banker to the Offer for the Book Building portion. The Central Depository Company of Pakistan ( CDC ) has developed a Centralized e-ipo System ( CES ) through which applications for subscription of securities offered through OFS can be made electronically. CES can be accessed through the web link ( CES would be connected to different entities (1Link, banks etc.) for payment of the subscription money. For details on CES, please refer para BOOK BUILDING PORTION WILL BE UNDERWRITTEN BY For investor education please visit Jama Punji is an investor education initiative of the Securities & Exchange Commission of Pakistan Date of Publication of this Offer for Sale Document: DD MM, 2017 OFSD and Subscription Form can be downloaded from the following websites For further queries you may contact Liberty Power Tech Limited: Kashif Hanif; Phone: Ext 390; info@libertypowertech.com Arif Habib Limited: Yasir Abbas; Phone: ; yasir.abbas@arifhabibltd.com Ismail Iqbal Securities Pvt. Limited: Sameer Khan; Phone ; sameer.khan@ismailiqbal.com * For Shari ah Compliance Certificate please refer to section 5.1

3 UNDERTAKING BY THE CHIEF EXECUTIVE OFFICER AND CHIEF FINANCIAL OFFICER June 1, 2017 WE AZAM SAKRANI, THE CHIEF EXECUTIVE OFFICER AND ADAMJEE YAKOOB, THE CHIEF FINANCIAL OFFICER OF LIBERTY POWER TECH LIMITED CERTIFY THAT: 1. THIS OFFER FOR SALE DOCUMENT CONTAINS ALL INFORMATION WITH REGARD TO THE OFFERORS AND THE OFFER, WHICH IS MATERIAL IN THE CONTEXT OF THE OFFER AND NOTHING HAS BEEN CONCEALED IN THIS RESPECT; 2. THE INFORMATION CONTAINED IN THIS OFFER FOR SALE DOCUMENT IS TRUE AND CORRECT TO THE BEST OF OUR KNOWLEDGE AND BELIEF; 3. THE OPINIONS AND INTENTIONS EXPRESSED THEREIN ARE HONESTLY HELD 4. THERE ARE NO OTHER FACTS, THE OMISSION OF WHICH MAKES THIS OFFER FOR SALE DOCUMENT AS A WHOLE OR ANY PART THEREOF MISLEADING; AND 5. ALL REQUIREMENTS OF THE SECURITIES ACT, 2015 AND THE PUBLIC OFFERING REGULATIONS, 2017 RELATING TO APPROVAL AND DISCLOSURES HAVE BEEN FULFILLED. 6. NO CHARGES, FEE, EXPENSES, PAYMENTS ETC. HAVE BEEN COMMITTED TO BE PAID TO ANY PERSON IN RELATION TO THIS PUBLIC OFFERING EXCEPT FOR THOSE AS DISCLOSED IN PART 3.8 OF THE OFFER FOR SALE DOCUMENT. For and behalf of Liberty Power Tech Limited -Sd- Azam Sakrani Chief Executive Officer -Sd- Adamjee Yakoob Chief Financial Officer Page 1 of 128

4 Note: This Supplement shall be published within 3 working days of the close of Bidding Period in at least all those newspapers in which the Offer for Sale Document of Liberty Power Tech Limited is published. SUPPLEMENT TO THE OFSD This Supplement is being published pursuant to The Public Offering Regulations, 2017 and in continuation of the Offer for Sale Document of Liberty Power Tech Limited earlier published on DD/MM/2017 FLOOR PRICE : PKR 40/- PER SHARE STRIKE PRICE : PKR XX/- PER SHARE OFFER PRICE: PKR XX/- PER SHARE Liberty Power Tech Limited Note: Since this Offer is being made through 100% book building with 25% allocation to retail investors, therefore, underwriting of the retail portion is not required. In case the Offer remains unsubscribed, the unsubscribed shares shall be allotted to the successful bidders on pro rata basis. The successful bidders have already given undertakings to subscribe such unsubscribed shares on pro rata basis. Category wise Breakup of Successful Bidders S. No Category No. of Bidders No. of shares provisionally allocated 1 Commercial Banks 2 Development financial institutions 3 Mutual Funds 4 Insurance Companies 5 Investment Banks 6 Employees Provident / Pension Funds 7 Leasing Companies 8 Modarabas 9 Securities Brokers 10 Foreign Institutional Investors 11 Any other Institutional Investors Institutional Investor 12 Individual Investors: Foreign Investors Local Individual Investors TOTAL Page 2 of 128

5 Glossary of Abbreviations and Terms ACT Securities Act, 2015 AHL Arif Habib Limited BR Book Runner BVPS Book Value Per Share CAGR Compound Annualized Growth Rate CDA Central Depository Act, 1997 CDC / CDCPL Central Depository Company of Pakistan Limited CDC Regulations Central Depository Company of Pakistan Limited Regulations CDS Central Depository System CNIC Computerized National Identity Card COI Certificate of Incorporation Collection Bank (Book Building) Summit Bank Limited Companies Act Companies Act, 2017 Commission / SECP Securities and Exchange Commission of Pakistan CPPA Central Power Purchasing Agency CRO Company Registration Office CUIN Computerized Unique Identification Number CVT Capital Value Tax EPS Earnings Per Share EPQL Engro Powergen Limited FBR Federal Board of Revenue FED Federal Excise Duty GDP Gross Domestic Product GoP Government of Pakistan HUBC Hub power Company Limited Offerors Existing shareholders of Liberty Power Tech Limited OFSD Offer for Sale Document ITO Income Tax Ordinance, 2001 IPP Independent Power Producer KAPCO Kot Addu Power Company Limited LPL Lalpir Power Limited Mn Million MVA Megavolt Ampere NICOP National Identity Card for Overseas Pakistani NOC No Objection Certificate NTDC National Transmission & Dispatch Company NCPL Nishat Chunian Power Limited NPL Nishat Power Limited Page 3 of 128

6 PKR or Rs. PSX / Exchange RFO SCRA SST SPWL SMBL UBL UIN WHT Pakistan Rupee(s) Pakistan Stock Exchange Limited Residual Fuel Oil Special Convertible Rupee Account Sindh Sales Tax Saif Power Limited Summit Bank Limited United Bank Limited Unique Identification Number Withholding Tax Page 4 of 128

7 DEFINITIONS Act Securities Act, Application Money Banker to the Book Building In case of bidding for shares out of the Book Building portion, the total amount of money payable by a successful Bidder which is equivalent to the product of the Strike Price and the number of shares to be allotted Bank(s) with whom an account is opened and maintained by the Offerors for keeping the bid amount. Summit Bank has been appointed as Banker to the Book Building. Bid Bid Amount Bid Collection Center Bid Price Bid Revision An indication to make an offer during the Bidding Period by a Bidder to subscribe to the Ordinary Shares of Liberty Power Tech Limited at a price at or above the floor price, including all the revisions thereto. An Eligible Investor shall not make a bid with price variation of more than 10% of the prevailing indicative strike price. Please refer to paragraph for details The amount equal to the product of the number of shares Bid for and the Bid price Designated offices of the Book Runner, specified branches of any of the Scheduled Bank and offices of any other institutions specified by the Commission where bids are received and processed. For this Offer, addresses of the Bid Collection Centers are provided in paragraph of this Offer for Sale Document. The price at which bid is made for a specified number of shares. The Eligible Investors can revise their bids upward subject to the provision of regulation 10(2)(iii) of the PO Regulations. The bids can be revised with a price variation of not more than 10% from the prevailing indicative Strike Price in compliance with Regulation 10(2)(iii) of the Regulations. As per the regulation 10(2)(vi) of the PO Regulations, the bidder shall not make downward revision or withdraw their bids. Bidder Bidding Form Bidding Period An Eligible Investor who makes bids for shares in the Book Building process. The form prepared by the Offerors for the purpose of making bids. The period during which bids for subscription of shares are received. Page 5 of 128

8 The Bidding Period shall be of two days, from DD/MM/2017 to DD/MM/2017 both days inclusive (daily from 9:00 a.m. to 5:00 p.m.). Book Building Book Building Account Book Building Portion Book Runner A process undertaken to elicit demand for shares offered for sale through which bids are collected from the Bidders and a book is built which depicts demand for the shares at different price levels. An account opened by the Offerors with the Collection Bank(s). The Bidder will pay the Margin Money / Bid Amount through demand draft, pay order or online transfer in favor of this account as per the instructions given in paragraph of this OFSD and the balance of the Application Money, if any, shall be paid through this account after successful allocation of shares under Book Building. The part of the total Offer allocated for subscription through the Book Building. A securities broker or a scheduled bank who holds a valid license from the Commission to act as an Underwriter and has been appointed as Book Runner by the Issuer. Ismail Iqbal Securities (Pvt.) Limited ( Ismail Iqbal or IISL ), has been appointed as Book Runner for this Offer. Book Building System Centralized E-IPO System (CES) An online electronic system operated by the Designated Institution for conducting Book Building. In order to facilitate investors, CDC has developed CES through which applications for subscription of securities offered to the general public can be made electronically. CES has been made available in this Offer for Sale (OFS) and can be accessed through the web link Payment of subscription money can be made through 1LINK s member banks available for CES, list of which is available on above website. For making application though CES, investors must be registered with CES. Registration with CES is free of cost and can be done under a selfregistration process by filling the CES registration form, which is available 24/7 all around the year. Investors who have valid Computerized National Identity Card (CNIC), bank account with any of the commercial bank, address, mobile phone number and CDS Account (Investor account or sub account) may registered themselves with CES. Investors who do not have CDS account may visit for information and details. For further guidance and queries regarding CES and opening of CDS account, investors may contact CDC at phone number: (CDCPL) and info@cdcpak.com Page 6 of 128

9 Collection Bank Company Company s Legal Advisor Summit Bank is the collection bank for the Book Building portion. For this purpose, the Offerors, has opened account with Summit Bank titled Liberty Power Tech Book Building, Number: xxx at its [xxx] Branch, [City]. The Collection Bank shall keep and maintain the bid money in the said account. Once the Strike Price is determined and lists of successful bidders and successful applicants/allottees are finalized and shares are credited to the successful bidders and applicants, the Consultant to the Offer, after obtaining NOC from PSX, may request in writing to the Collection Bank for transfer of the money of successful and accepted applications to the Offerors account(s) Liberty Power Tech Limited (the Company ) or ( LPTL ) Abdul Wahab Haroon, Advocate Shop No. 1, Hashoo Terrace, Block-5, Clifton, Karachi Commission Consolidated Bids Consultant to the Offer Securities & Exchange Commission of Pakistan ( SECP ) A bid which is fully or partially beneficially owned by persons other than the one named therein. Any person licensed by the Commission to act as a Consultant to the Offer. Arif Habib Limited has been appointed as Consultant to the Offer by Offerors for this Offer. Designated Institution Includes securities exchange, central depository or clearing house approved by the Commission to provide a system for conducting Book Building. Pakistan Stock Exchange Limited ( PSX ) will act as the Designated Institution for this Offer. Dutch Auction Method e-ipo The method through which Strike Price is determined by arranging all the Bids in descending order based on the bids price along with the number of shares and the cumulative number of shares bid for at each Bid Price level. The Strike Price is determined by lowering the bid price to the extent that the total number of shares offered under the Book Building Portion are subscribed. e-ipo is submission of application for subscription of securities electronically through internet, Automated Teller Machines (ATM) and mobile phones. In order to facilitate the public during IPOs, SECP has introduced the concept of e-ipo. The following two systems are available for e-ipos: Page 7 of 128

10 I. Centralized e-ipo System (CES): In order to facilitate investors, the Central Depository Company of Pakistan ( CDC ) has developed a Centralized e-ipo System ( CES ) through which applications for subscription of securities offered to the general public can be made electronically. CES has been made available in this Offer for Sale (OFS) and can be accessed through the web link Payment of subscription money can be made through 1LINK s member banks available for CES, list of which is available on above website. For making application though CES, investors must be registered with CES. Registration with CES is free of cost and can be done under a selfregistration process by filling the CES registration form, which is available 24/7 all around the year. Investors who have valid Computerized National Identity Card (CNIC), bank account with any of the commercial bank, address, mobile phone number and CDS Account (Investor account or sub account) may registered themselves with CES. Investors who do not have CDS account may visit for information and details. For further guidance and queries regarding CES and opening of CDS account, investors may contact CDC at phone number: (CDCPL) and info@cdcpak.com. Investors who are registered with CES can submit their applications through the web link 24 hours a day during the subscription period which will close at midnight on DD/MM/2017. II. e-ipo facilities by Bankers to the Offer: Currently, United Bank Limited (UBL), Summit Bank Limited (SMBL) and Bank Alfalah (BAFL) are providing e-ipo facilities to their respective accountholders. UBL account holders can use UBL Net Banking to submit their application via link SMBL account holders can use SMBL Net Banking to submit their application via link and BAFL account holders can use BAFL Net Banking to submit their application via link: Eligible Investor Floor Price General Public An Individual and Institutional Investor whose Bid Amount is not less than the minimum bid size of PKR 1,000,000 (One Million Rupees only). The minimum price per share set by the Offerors in consultation with Consultant to the Offer. For this Offer, Floor Price is PKR 40 per share. All Individual and Institutional Investors including both Pakistani (residents & non-residents) and foreign investors. Page 8 of 128

11 Institutional Investors Any of the following entities: A financial institution; A company as defined in the Companies Act; An insurance company established under the Insurance Ordinance, 2000; A securities broker A fund established as Collective Investment Scheme under the Non- Banking Finance Companies and Notified Entities Regulations, 2008; A fund established as Voluntary Pension Scheme under the Voluntary Pension System Rules, 2005; A private fund established under Private Fund Regulations, 2015; Any employee s fund established for beneficial of employees; Any other fund established under any special enactment; and Any other entity as specified by the Commission. Offer Offer of 126,146,014 Ordinary Shares of the Face Value of PKR 10.00/- each representing 25% of Total Paid Up Capital of the Company. Book Building Portion of the Offer comprises of 94,609,014 Ordinary Shares (75% of the Total Offer) at a floor price of PKR 40/- per share (including a premium of PKR 30/- per share) Retail Portion of the Offer comprises of 31,537,000 Ordinary Shares (25% of the Total Offer) at the Offer Price. Offer Price The price at which Ordinary Shares of the Company are offered to the General Public. In this Offer the Offer Price will be the Strike Price. Offerors Name of Offerors Mr. Muhammad Salim Mukaty Mrs. Hamida Salim Mukaty Mr. Muhammad Ashraf Mrs. Farheen Ashraf Liberty Mills Limited Number of shares divesting 42,300,000 15,400,000 16,200,000 33,691,928 18,554,086 Key Employees Limit Bid Limit Price Listing Committee Chief Executive Officer, Directors, Chief Financial Officer and Company Secretary of Liberty Power Tech Limited and Liberty Mills Limited. The bid at a Limit Price. The maximum price a prospective Bidder is willing to pay for a share under the Book Building. Listing Committee, shall mean a committee of PSX comprising of at least seven members including at least three external members for review and Page 9 of 128

12 approval of the prospectus / offer for sale document and the listing application Margin Money The partial or total amount, as the case may be, paid by a Bidder at the time of registering an Eligible Investor. The Book Runner shall collect full amount of the bid money as Margin Money in respect of bids placed by an individual investor and not less than twenty five percent (25%) of the bid money as Margin Money in respect of bids placed by an institutional investors. Minimum Bid Size The Bid amount equal to One Million Rupees (PKR 1,000,000) Ordinary Shares Ordinary Shares of Liberty Power Tech Limited having face value of PKR 10.00/- each OFSD Prospectus The Offer for Sale Document of the Offerors for the Offer of its 126,146,014 million ordinary shares to the public (including both the institutional investors and retail investors) containing all the information and disclosures as required under the Securities Act, 2015, and the Public Offering Regulations, Prospectus means any document described or issued as a prospectus and includes any document, notice, circular, material, advertisement, offer for sale document, publication or other invitation offering to the public (or any section of the public) or inviting offers from the public for the subscription or purchase of any securities of a company. As per the definition of Prospectus as defined in Securities Act 2015, this Offer for Sale document comes under the ambit of Prospectus. Registration Form The form which is to be submitted by the Eligible Investors for registration to participate in the Book Building process. The registration period shall commence atleast three days before the start of the Bidding Period from DD/MM/2017 to DD/MM/2017 from 9:00 am to 5:00 pm and shall remain open till 3:00 pm on the last day of the Bidding Period. PO Regulations The Public Offering Regulations, Related Employees Securities Regulations Such employees of the Offerors, the Company, Consultant to the Offer, Book Runner and the Underwriters who are directly involved in the Offer. Please refer to paragraph for further details. Chapter 5 of the Rule Book of the Pakistan Stock Exchange, titled Listing of Companies and Securities Regulation. Page 10 of 128

13 Shari ah Advisor Shari ah Certificate Sponsor A firm or a company who / that meets the fit and proper standards specified by the Commission or the State Bank of Pakistan for Shari ah advisory services. Shari ah certificate includes a Shari ah pronouncement or fatwa by the Shari ah Advisor. A person who has contributed initial capital in the issuing company or has the right to appoint majority of the directors on the board of the Company directly or indirectly; A person who replaces the person referred above; and A person or group of persons who has control of the Company whether directly or indirectly. Step Bid Strike Price Supplement to the Offer for Sale Document System Transaction Legal Counsel Step Bid means a series of limit bids at increasing prices. In case of a step bid the amount of each step will not be less than Rupees One Million (PKR 1,000,000). The price per ordinary share of the Offer determined / discovered on the basis of Book Building process in the manner provided in the PO Regulations, at which the shares are Offered to the successful bidders. The Strike Price will be disseminated after conclusion of Book Building through publication of Supplement to the OFSD in at least all those newspapers in which the OFSD was published and also posted on the websites of PSX, Consultant to the Offer, Book Runner and the Company. The Supplement to the Offer for Sale Document shall be published within three (3) working days of the closing of the Bidding Period at least in all those newspapers in which the OFSD was earlier published and disseminated through the PSX where shares of the Company are to be listed. An online electronic system operated by the Designated Institution for conducting Book Building. In this OFS, the System is being provided by PSX. Mohsin Tayebaly & Co. Interpretation: ANY CAPITALIZED TERM CONTAINED IN THIS OFFER FOR SALE DOCUMENT, WHICH IS IDENTICAL TO A CAPITALIZED TERM DEFINED HEREIN, SHALL, UNLESS THE CONTEXT EXPRESSLY INDICATES OR REQUIRES OTHERWISE AND TO THE EXTENT AS MAY BE APPLICABLE GIVEN THE CONTEXT, HAVE THE SAME MEANING AS THE CAPITALIZED / DEFINED TERM PROVIDED HEREIN. Page 11 of 128

14 Table of Contents 1 APPROVALS AND LISTING ON THE STOCK EXCHANGE VALUATION, BOOK BUILDING PROCEDURE AND SHARE CAPITAL UNDERWIRTING, COMMISSIONS, BROKREAGE AND OTHER EXPENSES OVERVIEW, HISTORY & PROSPECTS FINANCIAL INFORMATION MANAGEMENT MISCELLANEOUS INFORMATION APPLICATION AND ALLOTMENT INSTRUCTIONS INSTRUCTIONS FOR REGISTRATION AND BIDDING REGISTRATION FORM DUPLICATE REGISTRATION FORM BIDDING FORM ADDITIONAL PAYMENT FORM BID REVIISION FORM OFFERORS SIGNATURE SIGNATORIES TO THE OFSD MEMORANDUM OF ASSOCIATION APPLICATION FORM Page 12 of 128

15 1 APPROVALS AND LISTING ON THE STOCK EXCHANGE 1.1 APPROVAL OF THE SECURITIES AND EXCHANGE COMMISSION OF PAKISTAN Approval of the Securities & Exchange Commission of Pakistan (the "Commission" or the "SECP") under Section 87(2) of the Securities Act, 2015 read with Section 88(1) thereof, has been obtained by the Offerors for the issue, circulation and publication of this Offering document (hereinafter referred to as the Offer for Sale Document ) vide their letter No. [xxx] Dated [dd/mm/2017]. DISCLAIMER: IT MUST BE DISTINCTLY UNDERSTOOD THAT IN GIVING THIS APPROVAL, SECP DOES NOT TAKE ANY RESPONSIBILITY FOR THE FINANCIAL SOUNDNESS OF THE COMPANY AND ANY OF ITS SCHEMES STATED HEREIN OR FOR THE CORRECTNESS OF ANY OF THE STATEMENTS MADE OR OPINIONS EXPRESSED WITH REGARD TO THEM BY THE OFFEROR AND / OR THE COMPANY IN THIS OFFER FOR SALE DOCUMENT. SECP HAS NOT EVALUATED QUALITY OF THE OFFER AND ITS APPROVAL FOR OFFER, CIRCULATION AND PUBLICATION OF THE OFFER FOR SALE DOCUMENT SHOULD NOT BE CONSTRUED AS ANY COMMITMENT OF THE SAME. THE PUBLIC / INVESTORS SHOULD CONDUCT THEIR OWN INDEPENDENT DUE DILIGENCE AND ANALYSIS REGARDING THE QUALITY OF THE OFFER BEFORE BIDDING / SUBSCRIBING. 1.2 APPROVAL OF OFSD BY THE PSX The Offer for Sale Document of the Company has been approved by PSX vide letter No. [ ] dated [ ] in accordance with the requirements of the Securities Act, the PO Regulations and its regulations for Listing of Companies and Securities. DISCLAIMER: PSX HAS NOT EVALUATED THE QUALITY OF THE OFFER AND ITS APPROVAL SHOULD NOT BE CONSTRUED AS ANY COMMITMENT OF THE SAME. THE PUBLIC / INVESTORS SHOULD CONDUCT THEIR OWN INDEPENDENT INVESTIGATION AND ANALYSIS REGARDING THE QUALITY OF THE OFFER BEFORE SUBSCRIBING / BIDDING. THE PUBLICATION OF THIS DOCUMENT DOES NOT REPRESENT SOLICITATION BY PSX. THE CONTENTS OF THIS DOCUMENT DOES NOT CONSTITUTE AN INVITATION TO INVEST IN SHARES OR SUBSCRIBE FOR ANY SECURITIES OR OTHER FINANCIAL INSTRUMENT BY PSX, NOR SHOULD IT OR ANY PART OF IT FORM THE BASIS OF, OR BE RELIED UPON IN ANY CONNECTION WITH ANY CONTRACT OR COMMITMENT WHATSOEVER OF PSX. IT IS CLARIFIED THAT INFORMATION IN THIS OFFER FOR SALE DOCUMENT SHOULD NOT BE CONSTRUED AS ADVICE ON ANY PARTICULAR MATTER BY PSX AND MUST NOT BE TREATED AS A SUBSTITUTE FOR SPECIFIC ADVICE. PSX DISCLAIMS ANY LIABILITY WHATSOEVER FOR ANY LOSS ARISING FROM OR IN RELIANCE UPON THIS DOCUMENT TO ANYONE, ARISING FROM ANY REASON, INCLUDING, BUT NOT LIMITED TO, INACCURACIES, INCOMPLETENESS AND / OR MISTAKES, FOR DECISIONS AND /OR ACTIONS TAKEN, BASED ON THIS DOCUMENT. PSX NEITHER TAKES RESPONSIBILITY FOR THE CORRECTNESS OF CONTENTS OF THIS DOCUMENT NOR THE ABILITY OF THE COMPANY TO FULFILL ITS OBLIGATIONS THEREUNDER. ADVICE FROM A SUITABLY QUALIFIED PROFESSIONAL SHOULD ALWAYS BE SOUGHT BY INVESTORS IN RELATION TO ANY PARTICULAR INVESTMENT. Page 13 of 128

16 1.3 LISTING AT PSX Application has been made to PSX for permission to deal in and for quotation of the shares of the Company. If for any reason the application for formal listing is not accepted by PSX, or approval for formal listing is not granted by PSX before the expiration of twenty-one days from the date of closing of the subscription period / list or such longer period not exceeding forty-two days as may, within the said twenty-one days, be notified to the applicants for permission by the securities exchange, the Offerors undertakes that a notice to that effect will immediately be published in the press and will refund Application Money to the applicants without surcharge as required under the provisions of Section 69 of the Companies Act. If any such money is not repaid within eight (08) days after the Company becomes liable to repay it, the Directors of the Company shall be jointly and severally liable to repay that money from the expiration of the eight day together with surcharge at the rate of two per cent (2.0%) for every month or part thereof from the expiration of the eight day and, in addition, shall be liable to a penalty of level 3 on the standard scale as defined in Section 479 of the Companies Act. As required under sub-section (3) of Section 69 of the Companies Act, the Application Money including the Bid Money, in case of book building, shall be deposited and kept in a separate bank account in a scheduled bank so long as the company may become liable to repay it under sub-section (2) of Section 69 of the Companies Act; and, if default is made in complying with the said sub-section (3), the Company and every officer of the company who authorizes or permits the default shall be liable to a penalty of level 2 on the standard scale as defined in Section 479 of the Companies Act. Page 14 of 128

17 1.4 CERTIFICATE BY THE OFFERORS February 4th, 2017 The Chief Executive Pakistan Stock Exchange Limited Stock Exchange Building Stock Exchange Road Karachi We being the Offerors accept absolute responsibility for the disclosures made in this OFSD. We hereby certify that the OFSD contains all necessary information with regard to the Company and the offer and constitutes full, true and plain disclosures of all material facts relating to the shares being offered through this OFSD and that nothing has been intentionally concealed. The information contained in this OFSD is true and correct to the best of our knowledge and the opinions and intentions expressed herein are honestly held. There are no other facts, the omission of which makes this OFSD as a whole or any part thereof misleading. -Sd- Mr. Muhammad Salim Mukaty -Sd- Mr. Muhammad Ashraf -Sd- Mrs. Hamida Salim Mukaty -Sd- Mrs. Farheen Ashraf For and on behalf of Liberty Mills Limited -Sd- Mr. Muhammad Salim Mukaty -Sd- Mr. Younus Dawood Page 15 of 128

18 2 VALUATION, BOOK BUILDING PROCEDURE AND SHARE CAPITAL 2.1 VALUATION SECTION The shares of Liberty Power Tech Limited are being offered at Floor Price of PKR 40/- per Ordinary share which is at a premium of PKR 30/- per Ordinary share to the face value of PKR 10/- per Ordinary share. The Consultant to the Offer has reviewed the business performance of the Company and in their opinion the Floor Price of PKR 40/- per Ordinary share is justified based on: Strong Sponsor Profile The principal sponsor of the Company is Liberty Group, which holds majority shareholding (90%) through Liberty Mills Limited and the Mukaty family. The Liberty Group is principally engaged in textile sector, comprising Liberty Mills Limited (LML). LML, the family s main entity, incorporated in February 1965, is in the business of manufacturing and processing all kinds of textile fabrics and made ups. Today it is one of the largest textile processing unit in Pakistan with a production capacity of 500,000 square meters of fabric per day. At the time of project initiation, it was the only project in which Wartsila Development & Financial Services OY ( WDFS ) participated as the equity sponsor. Initial Equity portion contributed by WDFS was 13.48% Guaranteed Off-take LPTL has entered into a twenty five (25) years Power Purchase Agreement dated July 1 st, 2008 with National Transmission and Dispatch Company NTDCL (the 25 - year period took effect from commencement of commercial operations in January 2011), which guarantees the purchase of power generated by LPTL (the PPA ). The government of Pakistan has guaranteed capacity payment given adherence to agreed performance benchmarks USD Benchmarked Fixed Rate of Return The tariff provided to LPTL has a fixed part, the capacity charge, which is paid to LPTL upon meeting the minimum guaranteed availability. This is the main source of earnings. The second part is energy payments, payable upon production of electricity. Tariff March 2017 (PKR/Kwh) Energy Purchase Price Capacity Purchase Price Total Tariff Successful Operational History LPTL has a past record of six (6) years of successful commercial operations, having officially started operations on January, The plant net capacity generation is MW Discounted Price Liberty Power Tech s Floor Price of PKR 40 per share, based on last twelve month earnings from March 31st, 2017, translate to a price to earnings (P/E) multiple of 5.39 a discount of 27% relative to the average IPP sector P/E. Page 16 of 128

19 2.1.6 GOP Guarantee The Company signed Implementation Agreement (IA) with Islamic Republic of Pakistan ( GOP ) in June 2008 which acts as sovereign guarantee for the debt and equity investors of the project and guarantees the obligation of NTDC (company owned by WAPDA) under the Power Purchase Agreement Shari ah Compliance Company has been declared as Shari ah compliant Company by Mufti Ibrahim Essa based on Audited Financial Statements as at December 31st, For Shari ah Compliant certificate, refer to section 5.1. Profile of Shari ah Advisor Mufti Ibrahim Essa is a recognized Shari ah Scholar in the field of Islamic Banking and Takaful. He has completed his Darse Nizami (Masters in Quran and Sunnah) and Takhassus fil Ifta (Specialization in Islamic Jurisprudence) from Jamiah Darul Uloom Karachi. Currently he is working as teacher and Member of Darul Ifta Jamiah Darul Uloom Karachi. Mufti Ibrahim Essa is also associated as Chairman Shari ah Supervisory Board Sind Bank Limited and Member Shari ah Board Habib Metropolitan Bank Limited. He was associated with Ernst & Young Ford Rhodes Sidat Hyder & Co as Shari ah advisor from 2007 to He is also the Shari ah advisor of number of Islamic Financial Institutions including National and International including Equitable Financial Solutions (Australia), ORIX Leasing Pakistan Limited, EFU Takaful etc. Number of Charitable Institutions including The Indus Hospital, The Citizens Foundation, Layton Rehmatullah Benevolent Trust, The Hunar Foundation, etc. take Shari ah advices from him on their Zakat and Donation matters. He has also written more than two thousand Fatwa on different topic Management Quality LPTL s management team comprises qualified professionals possessing sufficient experience in various sectors. Mr. Azam Sakrani, the CEO, has over 22 years of experience in the banking, finance and industrial finance as well, and has been with the Company since 3 years. The Company has a well-defined organizational structure with the CEO reporting to the board. The heads of the Support System Department and Strategic Business Unit report directly to the CEO. The top management is supported by a team of professionals working under various sub-divisions to ensure smooth reporting. The CFO of the Company changed in September The new Company and Group CFO, Mr. Adamjee Yakoob, is a Chartered Accountant, and has previously worked as CFO of Citibank Pakistan MIS Reporting System The Company maintains a strong MIS reporting system for the management to keep track of all operating activities and operational efficiencies. The system generates daily reports, which are presented to the management, including: 1. Collection reports 2. Fuel status and ordering situation 3. Cash flow planner Apart from daily reporting, the management also receives a more detailed MIS on a monthly basis containing information on fuel price volatility, inventory, fuel cost component comparison and operational and financial results. Page 17 of 128

20 Strong O&M Contractor The operation and maintenance (O&M) poses a risk to IPPs for not being able to deliver required performance. Inability to deliver expected and required contractual performance may lead to hefty liquidity damages and drying up cash flows. In order to negate such risks, the Company has entered into an O&M contract with Wärtsilä Pakistan (WPK). The O&M contract was renewed on 9 th of May 2015 and is valid for a period of six years from the effective date. Wärtsilä Pakistan (Pvt.) Limited is a Wärtsilä Corporation Company. It was established in November It is a Sales and After-Sales-Service provider for all Wärtsilä customers in Pakistan. Since its inception, the installed base that is serviced by Wärtsilä in Pakistan has grown from 4 MW to more than 1.8 GW. It employs more than 400 professionals to serve its customers and is a total service provider. WPK retains highly qualified expert for all plant related issues. If a problem arises pertaining to a specific area of the complex, WPK will send out the relevant expert for diagnoses and repair. O&M contracts aligns the incentive for both the Company and WPK as higher availability of the plant means higher return to WPK and higher capacity payments to the Company. Today, plants using Wärtsilä equipment supplies approximately 5% of Pakistan s national generation capacity. Under Service Agreements, Wärtsilä operates and maintains power plants equaling 0.7 GW capacity. Wärtsilä Corporation Company is a global leader in advanced technologies and complete lifecycle solutions for the marine and energy markets. The Company has operations in over 200 locations in more than 70 countries around the world. Wärtsilä Energy Solutions is a leading global supplier of ultra-flexible power plants of up to 600 MW operating on various gaseous and liquid fuels. The portfolio includes solutions for baseload, peaking, reserve and load-following power generation, as well as for balancing intermittent renewable energy. Wärtsilä Energy Solutions also provides utility-scale solar PV power plants, as well as LNG terminals and distribution systems. As of 2016, Wärtsilä has 60 GW of installed power plant capacity in 176 countries around the world. In order to enhance the life span of Steam Turbine parts, the Company uses Reverse Osmosis (RO) Water resulting in a lower O&M cost. Company also utilizes SS tanks instead of MS tanks because of their longer life. MS tanks have a shorter life of around 5 to 6 years. This short life results in an additional cost and disturbs the operational availability of the Plant Fuel Supply Management The Company had entered into a Fuel Supply Agreement dated 18th December 2008 with Shell Pakistan Limited under which Shell Pakistan Limited is obliged to supply the fuel requirements of the Company. However since the last several years, the Company has been making its purchases of fuel from various oil marketing companies from time to time as per the Company s requirement and keeping in view the service and quality standards of the fuel supplier. The Company s fuel supply arrangements with various oil marketing companies ensures timely supply of quality fuel for the smooth operations of the power generation complex of the Company. LPTL also has very stringent systems for checking fuel quality / quantity. LPTL has invested in the best scale from Avery UK. It keeps control of the fuel quantity supplied by monitoring through software. For quality control, LPTL has world renowned instruments for checking of quality of RFO parameters. The RFO testing lab has USA/UK/Japan manufactured equipment with calibrated gadget. Page 18 of 128

21 Strong Credit Rating The Company s long term Entity rating is A+ and short term rating is A1 as awarded by PACRA in December Historical rating is provided in the following table: Dissemination Date Long term Short term Outlook December 2016 A+ A1 Stable December 2015 A+ A1 Stable December 2014 A+ A1 Stable November 2013 A+ A1 Stable November 2012 A+ A1 Stable April 2012 AA A1+ Stable Source: PACRA Credit Rating Report December, Justification Based on their review, the Consultant to the Offer is of the opinion that the historical performance of the Company, the sponsor s profile, quality of management and guaranteed return in USD terms indicate sustainability of business performance in the future. Furthermore, with ever increasing electricity demand as a result of economic boom in Pakistan, the Company is sitting in a position to take advantage of such expansion. 2.2 BOOK BUILDING PROCEDURE Brief Structure The Present Offer The Offer comprises 126,146,014 ordinary shares of face value of PKR 10/- each which constitutes 25% of the total paid up capital of the Company. The Offer is being made through the Book Building process at a Floor Price of PKR 40/- per Ordinary share (including a premium of PKR 30/- per Ordinary share). The bidders shall be allowed to place bids for one hundred percent (100%) of the offer size and the strike price shall be the price at which one hundred percent (100%) of the offer size is subscribed. However, the successful bidders would be allotted only seventy-five percent (75%) of the offer size i.e. 94,609,014 ordinary shares and the remaining twenty five percent (25%) i.e. 31,537,000 ordinary shares would be offered to the retail investors. The bidders shall give an undertaking along with the application that they would subscribe to the unsubscribed shares, if any, by the retail investors and their remaining bid money would remain deposited/ blocked till allotment of unsubscribed shares of the retail portion, if any, to them on pro-rata basis. In case the retail portion is fully subscribed, the bid money shall be unblocked within one (1) working day or refunded within three (3) working days from the date of confirmation of shares subscribed in the general portion. Within 3 working days from the close of the Bidding Period, a Supplement to the OFSD will be published in at least all those newspapers in which the OFSD is published. The Supplement will contain information related to the Strike Page 19 of 128

22 Price, the Offer Price and category wise break-up of the successful bidders. Format of the Supplement is given on page 2 of this OFSD Types of Bids and Procedure for making a Bid Book Building is a process whereby investors bid for a specific number of shares at various prices. The Offerors set a Floor Price, which is the minimum / lowest price a Bidder can bid at. An order book of bids is maintained by the Book Runner, which is then used to determine the Strike Price through the Dutch Auction Method. Under the Dutch Auction Method, the Strike Price is determined by lowering the Bid Price to the extent that the total number of shares offered through the Book Building process are subscribed. A bid by a Bidder can be a Limit Bid, or a Step Bid, each of which are explained below: Limit Bid: Limit bid is at the Limit Price, which is the maximum price a Bidder is willing to pay for a specified number of shares. In such a case, a Bidder explicitly states a price at which he / she / it is willing to subscribe to a specific number of shares. For instance, a Bidder may bid for 2 million shares at PKR per share, based on which the total Application Money would amount to PKR 80 million. In this case the Bid Amount will be also PKR 80 million. Since the Bidder has placed a Limit Bid of PKR per share, this indicates that he / she / it is willing to subscribe the shares at a price up to PKR per share. Step Bid: A series of Limit Bids at increasing prices. The aggregate amount of Step Bid shall not be less than PKR 1,000,000 and the amount of any individual step shall also not be less than PKR 1,000,000. Under this bidding strategy, Bidders place a number of Limit Bids at different increasing price levels. A Bidder may, for instance, make a bid for 0.5 million shares at PKR per share, 1 million shares at PKR per share and 1.5 million shares at PKR per share. Therefore in essence the Bidder has placed one Step Bid comprising of three Limit Bids at increasing prices. The Bid amount will be PKR 128 million. In case of individual Bidder, the Margin Money will be 100% i.e. PKR 128 million whereas in case of Bidders being Institutional Investor the Margin Money shall be 25% of the Bid amount i.e. PKR 32 million. Restrictions: 1. AN ELIGIBLE INVESTOR SHALL NOT: a. BID BELOW THE FLOOR PRICE; b. MAKE A BID FOR MORE THAN 10% OF THE SHARES ALLOCATED UNDER THE BOOK BUILDING PORTION; c. MAKE A BID WITH A PRICE VARIATION OF MORE THAN 10% OF THE PREVAILING INDICATIVE STRIKE PRICE AS PER REGULATION 10(2)(iii) OF THE PO REGULATIONS; d. PLACE CONSOLIDATED BID. A BID APPLICATION WHICH IS FULLY OR PARTIALLY BENEFICIALLY OWNED BY PERSONS OTHER THAN THE ONES NAMED THEREIN IS TO BE CONSIDERED AS A CONSOLIDATED BID; e. MAKE MORE THAN ONE BID SEVERALLY OR JOINTLY, HOWEVER, A BID CAN BE REVISED UPWARDS TILL 5.00 PM ON THE LAST DAY OF THE BIDDING PERIOD; f. REVISE BID DOWNWARD; AND g. WITHDRAW BID. 2. RELATED EMPLOYEES AND CONNECTED PERSONS OF THE OFFEROR AND THE BOOK RUNNER SHALL NOT PARTICIPATE IN THE BIDDING PROCESS. 3. NO PERSON SHALL TAKE PART IN THE BOOK BUILDING PROCESS, DIRECTLY OR INDIRECTLY SEVERALLY OR JOINTLY IN ANY MANNER OR ENGAGE IN ANY ACT OR PRACTICE WHICH CREATE A FALSE AND MISLEADING APPEARANCE OF ACTIVE BIDDING FOR RAISING OR DEPRESSING STRIKE PRICE IN THE BOOK BUILDING PROCESS. Page 20 of 128

23 4. ASSOCIATES OF THE OFFERORS AND THE COMPANY AS DISCLOSED IN THE OFSD SHALL NOT IN AGGREGATE MAKE BIDS FOR SHARES IN EXCESS OF FIVE PER CENT OF THE BOOK BUILDING PORTION. 5. AS PER REGULATION 7(9) OF THE PO REGULATIONS, THE ASSOCIATES OF THE CONSULTANT TO THE OFFER AND THE BOOK RUNNER SHALL NOT IN AGGREGATE MAKE BIDS FOR SHARES IN EXCESS OF TWO (2) PERCENT OF THE BOOK BUILDING PORTION. LIST OF ASSOCIATED COMPANIES AND UNDERTAKINGS OF THE OFFERORS, NAMES OF RELATED EMPLOYEES OF THE OFFERORS, CONSULTANT TO THE OFFER AND BOOK RUNNER ARE PROVIDED IN SECTION Once the Bidding Period has lapsed and the book has been built, the, Strike Price shall be determined on the basis of Dutch Auction Method. Successful Bidders shall be intimated, within one (1) working day of the closing of the Bidding Period, about the Strike Price and the number of shares provisionally allotted to each of them. The bid money of bidders who have undertaken to subscribe the unsubscribed retail portion shall remain deposited or blocked till allotment of unsubscribed retail portion, if any, to them on pro-rata basis. Upon intimation by the Book Runner of the final allocation, successful institutional bidders shall deposit their balance margin money within (3) days of such intimation. Where a successful Bidder defaults in payment of shares allotted to him / her / it, the Margin Money deposited by such Bidder shall be forfeited to the Book Runner. As per regulation 9(16) of the PO Regulations, the successful bidders shall be issued shares only after the end of the public subscription, in the form of book-entry to be credited in their respective CDS accounts (investors account or Sub-Account). All the bidders shall, therefore, provide number of their CDS accounts in the bid application. The Bidders are encouraged to fill-in the part of the Bidding Form under the heading, Dividend Mandate to enable the Company to directly credit their cash dividend, if any, in their respective Bank Accounts Mechanism for Determination of Strike Price 1. At the close of the bidding period, the Strike Price shall be determined on the basis of Dutch Auction Method by the System. Under this methodology, the Strike Price is determined by lowering the price to the extent that the total number of shares offered are subscribed. 2. The Order Book shall display the bid prices in a tabular form in descending order along with the number of shares bid for and the cumulative number of shares at each price level. 3. In case all the bids made above the Strike Price are accommodated and shares are still available for allotment, such available shares will be allotted against the bids made at the Strike Price strictly on time priority basis. The mechanism for determination of the Strike Price can be understood by the following illustration: 1. Number of shares being Issued through the Book Building: 126,146,014 Ordinary Shares 2. Floor Price: PKR 40 per Ordinary Share 3. Bidding Period: From DD/MM/2017 to DD/MM/ Bidding Time: 9:00am 5:00pm 5. Bidding Revision Time (Upward Revision only): 9:00am 5:00pm on all days Page 21 of 128

24 Bidder Price Cumulative Number Quantity (PKR/share) of shares Category of Order Institution A ,500,000 9,500,000 Limit Price Institution B ,000,000 20,500,000 Limit Price HNWI A ,500,000 32,000,000 Step Bid Institution C ,000,000 42,000,000 Limit Price Institution D ,500,000 51,500,000 Limit Price HNWI B ,500,000 62,000,000 Limit Price HNWI A ,500,000 73,500,000 Step Bid Institution E ,000,000 83,500,000 Limit Price HNWI C ,500,000 93,000,000 Limit Price Institution F ,500, ,500,000 Step Bid Institution E ,000, ,500,000 Limit Price HNWI D ,500, ,000,000 Step Bid HNWI E ,000, ,000,000 Limit Price Institution F ,000, ,000,000 Step Bid HNWI D ,500, ,500,000 Step Bid HNWI F ,500, ,000,000 Limit Price Strike Price determine through Dutch Auction Method Bid has been revised upwards and placed at PKR 49.3 Total shares subscribed On the basis of the figures provided in the above illustration, according to the Dutch Auction Method, the Strike Price would be set at PKR 43.0 per share to fill the required quantity of 126,146,014 ordinary shares. At PKR 45.4 per share, investors are willing to buy 9,500,000 shares. Since 116,646,014 shares are still available, therefore the price will be set lower. At PKR 45.2 per share, investors are willing to buy 11,000,000 shares. Since 105,646,014 shares are still available, therefore the price will be set lower. At PKR 45.0 per share, investors are willing to buy 11,500,000 shares. Since 94,146,014 shares are still available, therefore the price will be set lower. At PKR 44.8 per share, investors are willing to buy 10,000,000 shares. Since 84,146,014 shares are still available, therefore the price will be set lower. Page 22 of 128

25 At PKR 44.6 per share, investors are willing to buy 9,500,000 shares. Since 74,646,014 shares are still available, therefore the price will be set lower. At PKR 44.4 per share, investors are willing to buy 10,500,000 shares. Since 64,146,014 shares are still available, therefore the price will be set lower. At PKR 44.2 per share, investors are willing to buy 11,500,000 shares. Since 52,646,014 shares are still available, therefore the price will be set lower. At PKR 44.0 per share, investors are willing to buy 10,000,000 shares. Since 42,646,014 shares are still available, therefore the price will be set lower. At PKR 43.8 per share, investors are willing to buy 9,500,000 shares. Since 33,146,014 shares are still available, therefore the price will be set lower. At PKR 43.6 per share, investors are willing to buy 11,500,000 shares. Since 21,646,014 shares are still available, therefore the price will be set lower. At PKR 43.2 per share, investors are willing to buy 10,500,000 shares. Since 11,146,014 shares are still available, therefore the price will be set lower. At PKR 43.0 per share, investors are willing to buy 12,000,000 shares. Since after bidding for 12,000,000 shares at PKR 43.0 per share, no shares will be available therefore the Strike Price will be set at PKR 43.0 per share for the entire lot of 126,146,014 shares. The bidders who have placed bids at prices above the Strike Price (which in this illustration is PKR 43.0 per share), will become entitled for allotment of shares at the Strike Price and the differential shall be refunded. In case all the bids made above the Strike Price are accommodated and shares are still available for allotment, such available shares will be allotted against the bids made at the Strike Price strictly on time priority basis as per regulation 9(12) of the PO Regulations. The Bidders who have made bids below the Strike Price shall not qualify for allotment of shares and their Margin Money will be refunded within three (3) working days of the close of the bidding period, as per regulation 8(16) of the PO Regulations. Only 75% of the total shares offered through book building shall provisionally be allocated to the successful bidders. The bidders shall give an undertaking along with the application that they would subscribe to the unsubscribed shares, if any, by the retail investors and their remaining bid money would remain deposited/ blocked till allotment of unsubscribed shares by the retail investors, if any, to them on pro-rata basis. In case the retail portion is fully subscribed, the bid money shall be unblocked within one (1) working day or refunded within three (3) working days from the date of confirmation of shares subscribed in the general public portion Timeframe for intimation to the successful bidders and Mechanism for payment of the balance amount by the successful bidders Successful bidders shall be intimated, within one (1) working day of the closing of the bidding period, the Strike Price and the number of shares provisionally allotted to each of them. Upon intimation by the Book Runner of the final allocation, successful institutional bidders shall deposit their balance margin money within (3) days of such intimation. Where a successful Bidder defaults in payment of shares allotted to it, the Margin Money deposited by such Bidder shall be forfeited to the Book Runner Consultant to the Offer Arif Habib Limited ( AHL ) has been appointed by the Offerors as Consultant to this Offer. Page 23 of 128

26 2.2.6 Interest of Consultant to the Offer and Book Runner other than their Role as Consultant to the Offer and Book Runner The Consultant to the Offer and Book Runner are deemed to be interested to the extent of fees payable to them by the Offerors for the services of Consultant to the Offer and Book Runner. The Consultant to the Offer and Book Runner have no other interest in any property or profits of the Company Book Runner Ismail Iqbal Securities (Pvt.) Limited ( IISL ) has been appointed by the Offerors as Book Runner. Roles and Responsibilities of the Book Runner The Book Runner shall be responsible to: 1. ensure that necessary infrastructure and electronic system is available to accept bids and to conduct the whole Book Building process in a fair, efficient and transparent manner; 2. ensure blocking, where required of bid and margin money of the Bidders in their respective accounts; 3. the Book Runner must be financially capable for honouring its commitments arising out of defaults by their investors, if any; 4. use the software provided by the Designated Institution for the Book Building on such terms and conditions as may be agreed through an agreement in writing; 5. ensure that the software used for Book Building is based on Dutch Auction Method for display of the order book in descending order and determination of the strike price; 6. ensure that the bidders can access to the System and can revise their bids electronically using the user ID and the password; 7. ensure that it has obtained list and UIN of the associates of the Offerors and the Consultant to the Offer; 8. ensure that names and UIN of all the persons are entered and capped in a manner as prescribed in the PO Regulations before commencement of the Bidding Period; 9. ensure that no bid or bids exceeding five per cent (5%), in aggregate, is or are made by the associated companies and associated undertakings of the Offerors; 10. ensure that it has blocked UIN and names of all related employees for participation in the bidding; 11. enter into an underwriting agreement with the Offerors with respect to underwriting of the Book Building portion for covering the default risk; 12. at least establish bid collection centres in Islamabad, all the provincial capitals, Azad Kashmir and Gilgit/ Baltistan; 13. maintain record of all the bids received; and 14. ensure that all the Bids received in the Bid Collection Centers are entered into the Book Building System within the prescribed time. The Book Runner has established bid collection centers at the following addresses (direct & fax numbers in all centers). Bid Collection Centers Book Runner has established bid collection centers at the following addresses: Karachi Contact Officer: Yasir Abbas Abdul Qadir Direct No.: Page 24 of 128

27 Mobile No.: PABX No.: Fax No.: yasir.abbas@arifhabibltd.com abdul.qadir@arifhabibltd.com Postal Address: Arif Habib Center, 23 MT Khan Road, Karachi Naya Nazimabad, Mangophir Road, Karachi Lahore Azad Kashmir Contact Officer: Muhammad Waleed Rahmani Atif Zahoor / Zia Ullah Direct No.: Mobile No.: Fax No.: waleed.rahmani@arifhabibltd.com atif.zahoor@summitbank.com.pk ziaullah@summitbank.com.pk Postal Address: Room # 220, Arif Habib Limited, Lahore Stock Exchange, Lahore NS Tower 119 F/1, Kotli Road Mirpur Azad Kashmir Islamabad Contact Officer: Awais Ahmed Riaz Hussain Direct: PABX: Fax No: awais.ahmed@summitbank.com.pk riazhussain@summitbank.com.pk Postal Address: Plot # 109, East F-7/G-7, Jinnah Avenue, Blue Area-Islamabad Plot # 109, East F-7/G-7, Jinnah Avenue, Blue Area-Islamabad Peshawar Contact Officer: Sohail Akhtar Ihsan-Ul-Haq Direct: PABX: Fax No.: sohail.akhtar@summitbank.com.pk ihsan.haq@summitbank.com.pk Postal Address: Deans Trade Centre, Islamia Road, Saddar, Peshawar Deans Trade Centre, Islamia Road, Saddar, Peshawar Quetta Contact Officer: Syed Noman Mansoor Muhammad Ali Direct: PABX: Fax No.: nomanmansoor@summitbank.com.pk ali.muhammad@summitbank.com.pk Postal Address: Ground Floor, Malik Plaza, Near Adara-e- Saqafat, M.A. Jinnah Road, Quetta Gilgit / Baltistan Contact Officer: Shahjahan / Qurban Karim Direct: Fax No.: sjhunzai@summitbank.com.pk qurbankarim@summitbank.com.pk Ground Floor, Malik Plaza, Near Adara-e- Saqafat, M.A. Jinnah Road, Quetta Page 25 of 128

28 Postal Address: Khasra# 1103,1112 & 1113, Haji Ghullam Hussain Building Raja Bazar, Gilgit Roles and Responsibilities of the Designated Institution PSX being provider of the Book Building System (Designated Institution), shall ensure that Book Building System shall smoothly perform following functions: 1. Record name, UIN, National Tax Number (NTN), postal and addresses, land line and cell numbers, bank account number and branch address and Investor Account Number or Sub-Account Number of the bidder with participant account number; 2. Provide a mechanism for registration of the bidders at least three days before commencement of the bidding period till 03:00 p.m. on the last day of the Bidding Period and require the investors to provide at least such information as mentioned above; 3. Generate bidders Internet Protocol (IPs) address and keep record of all IP addresses from where the bids are placed; 4. Record the number of shares bid for, the Bid Price, type of the bid i.e. Limit Bid or Step Bid, date and time of the entry of the bid; 5. Display the bids revised upwards, and date and time of upward revision; 6. Not accept the bids placed at a Bid Price that is below the Floor Price; 7. Display live the total number of shares offered for sale, the Floor Price, total number of bids received, total number of shares bid for, indicative Strike Price and Bidding range; 8. Build an order book showing demand for the shares at various price levels in a descending order along with the accumulated number of shares bid for and percentage of total shares offered under the Book Building Portion; 9. Discover the strike price at the close of the Bidding Period; 10. Generate alerts for the Bidders via Short Message Service ( SMS ) through cell phones and s upon entry of the bid, at the time of upward revision of the bid, and upon discovery of the strike price; and 11. Ensure that system must provide the bidders the option to upward revise their bids online or through the Book Runner during the period permitted under the PO Regulations. PSX shall ensure that: identity of the bidder is not displayed; and no bid is entered into the System after closing of the Bidding Period Roles and Responsibilities of the Offerors The Offerors shall ensure that: 1. the Company, its sponsors, promoters, substantial shareholders, directors and associates shall have no over dues or defaults, irrespective of the amount, appearing in the report obtained from the credit information bureau; 2. the Offeror and their company s directors, sponsors or substantial shareholders should not have held the office of the directors, or have not been sponsors or substantial shareholders in any company, I. which had been declared defaulter by the securities exchange or futures exchange; or II. whose TRE certificate has been cancelled or forfeited by the securities exchange; or Page 26 of 128

29 III. which has been de-listed by the securities exchange due to non-compliance of its regulations. 3. Consultant to the Offer, Book Runner, Underwriter, Balloter and Share Registrar and Banker to the Offer, where required, are appointed through separate agreements in writing. 4. It has submitted through its Consultant to the Offer application along with draft OFSD for listing of its securities to the securities exchange Opening and Closing of Registration Period The Registration period shall be for Five (5) working days i.e. DD/MM/2017 to DD/MM/2017 from 9:00 AM to 5:00 PM and from 9:00 AM to 3:00 PM on DD/MM/2017. DD/MM/2017 DD/MM/2017 DD/MM/2017 DD/MM/2017 DD/MM/2017 REGISTRATION PERIOD 9:00am to 5:00pm 9:00am to 5:00pm 9:00am to 5:00pm 9:00am to 5:00pm 9:00am to 3:00pm Opening and Closing of Bidding Period The Bidding Period shall be for Two (2) working days i.e. DD/MM/2017 and DD/MM/2017. The bidding will commence at 09:00 am and shall close at 05:00 pm on both days. BIDDING PROCESS STARTS ON BIDDING PROCESS ENDS ON DD/MM/2017 (9:00 AM to 5:00 PM) DD/MM/2017 (9:00 AM to 5:00 PM) Eligibility to Participate in Bidding Eligible Investors who can place their bids in the Book Building process include local and foreign Individual and Institutional Investors whose Bid Amount is not less than PKR 1,000,000 (Rupees One Million only) Information for Bidders 1. The OFSD for Offer of Shares has been approved by PSX and approved by SECP. 2. The OFSD, Registration Forms, Bidding Forms and Bid Revision Forms can be obtained from the Registered Office of Liberty Power Tech Limited and AHL and the designated Bid Collection Centers. OFSD, Registration Forms, Bidding Forms and Bid Revision Forms can also be downloaded from the following websites of the Book Runner and the Company: and 3. Eligible Investors who are interested in subscribing to the Ordinary Shares should approach the Book Runner at the addresses provided in paragraph for registration for submitting their Bids. Page 27 of 128

30 4. THE REGISTRATION FORMS SHOULD BE SUBMITTED ON THE PRESCRIBED FORMAT AT THE ADDRESSES PROVIDED IN PARAGRAPH FOR DETAILS ON THE PROCEDURE OF REGISTRATION PLEASE REFER TO PARAGRAPH THE BIDS SHOULD BE SUBMITTED ON THE PRESCRIBED BIDDING FORM IN PERSON, THROUGH FAX NUMBERS GIVEN IN PARAGRAPH OR THROUGH THE ONLINE SYSTEM USING THE USER ID AND PASSWORD ISSUED AT THE TIME OF REGISTERATION OF ELIGIBLE INVESTOR. 6. REGISTERED INVESTORS CAN PLACE AND REVISE THEIR BIDS UPWARDS BY ACCESSING PSX ONLINE PORTAL FOR BOOK BUILDING BY USING THE USER ID AND PASSWORD COMMUNICATED TO THEM VIA BY PSX. 7. EACH ELIGIBLE INVESTOR SHALL ONLY SUBMIT A SINGLE PAY ORDER, DEMAND DRAFT OR EVIDENCE OF ONLINE TRANSFER OF MONEY ALONG WITH THE REGISTRATION FORM. IT MAY ALSO BE NOTED THAT ONLY A SINGLE PAY ORDER, DEMAND DRAFT OR EVIDENCE OF ONLINE TRANSFER OF MONEY SHALL BE ACCEPTED BY THE BOOK RUNNER ALONG WITH EACH ADDITIONAL PAYMENT FORM. 8. ELIGIBLE INVESTORS WHO ARE ACCOUNT HOLDERS OF SMBL CAN USE THE ONLINE TRANSFER FACILITY (PAY ORDER OR DEMAND DRAFT MAY BE DEPOSITED AT ANY BRANCH OF SMBL AND EVIDENCE TO BE SUBMITTED TO THE BOOK RUNNER) TO DEPOSIT THEIR BID MONEY TO THE BOOK BUILDING ACCOUNT OPENED AT SMBL Bidders Registration form and Procedure for Registration 1. A standardized Registration Form has been prescribed by the Offerors for registration of Bidders. The Registration Form shall be submitted, duly filled in, at the Bid Collection Centers in person on addresses given in paragraph on the standard Registration Form. The Registration Form shall be serially numbered at the bid collection centers and date and time stamped at the time of collection of the same from the Bidders. 2. Upon completion and submission of the Registration Form, the Bidders are deemed to have authorized the Offerors to make necessary changes in the OFSD as would be required for finalizing and publishing the Supplement to the OFSD in the newspapers in which OFSD was published and filing the Supplement with the PSX and the SECP, without prior or subsequent notice of such changes to the Bidders. 3. The registration procedure under the Book Building process is outlined below: The Registration period shall be for Five (5) working days i.e. DD/MM/2017 to DD/MM/2017 from 9:00 AM to 5:00 PM and from 9:00 AM to 3:00 PM on DD/MM/2017. The Registration Form shall be issued in duplicate signed by the Bidder and countersigned by the Book Runner, with the first copy for the Book Runner, and the second copy for the Bidder. The Registration Form shall be duly filled in and signed in duplicate and shall be submitted at the Bid Collection Centers in person, through representative or through fax on addresses and numbers given in paragraph Upon registration of the bidders in the System, PSX shall assign and communicate the User ID and password to the Bidders via on the address provided by them in the Registration Form. The Book Runner may reject any bid for reasons to be recorded in writing provided the reason of rejection is disclosed to such bidder. Decision of the Book Runners shall not be challengeable by the Bidder or its associates. Bid Amount / Margin Money shall be deposited along with the Registration Form through demand draft, pay order or online transfer. In case of Online Transfer, the Bidders are requested to submit a bank receipt evidencing transfer of the bid money into the Offeror s designated bank account. Please note that cash must not be deposited either directly or through online transfer in the Offeror s designated bank account. The pay order shall be made in favor of Liberty Power Tech Book Building. For online transfer the payment shall be made into [Account Number] being maintained in Summit Bank [Branch] with the Page 28 of 128

31 Account Title Liberty Power Tech Book Building. Please note that online transfer facility shall only be allowed to the accountholders the Summit Bank customers. Please note that third party instruments will not be accepted for Margin Money. o In case of intra city payment instruments, the bidders shall ensure that the payment instruments are made Payable at any Branch. Intra city payment instruments that are not made Payable at any Branch will not be accepted. The Book Runners shall collect an amount of 100% of the Application Money as Margin Money in respect of bids placed by Individual Investors. The Book Runners shall collect an amount of not less than 25% of the Application Money as Margin Money in respect of bids placed by Institutional Investors. The Bidder shall provide a valid address in the Registration Form so that the relevant ID and password can be ed to them upon registration. The Bidders can use the User ID and password to directly place and upward revise their bids online. The successful Bidders shall be issued shares only in the form of book-entry to be credited in their respective CDS accounts. All the bidders shall, therefore, provide their CDS account numbers in the bid application and Bidding Registration form Procedure for Bidding 1. A standardized Bidding Form has been prescribed by the Offerors. 2. Registered Investors can submit their bids in person or through representatives at the Bid Collection Centers during the bidding dates or can place their bids online at using the user ID and password received by them over upon registration with the Book Runner. 3. The bidding procedure under the Book Building process is outlined below: Bids can be placed either at the Limit Price or as a Step Bid. The minimum size of a Limit Bid by an Eligible Investor shall not be less than PKR 1,000,000/- (Rupees One Million) and in case of a Step Bid, the amount of any step shall also not be less than PKR 1,000,000/- (Rupees One Million). The investors may place their bids through any of the Bid Collection Centers established pursuant to the requirements of sub-regulation 10 of regulation 8 of the PO Regulations. Please see para for addresses and contact detail of persons at the Bid Collection Centers The persons at the Bid Collection Centers shall vet the bid applications and accept only such bid applications that are duly filled in and supported by pay order, demand draft or a bank receipt evidencing transfer of the bid money into the Offeror s designated bank account. On receipt of bid application in accordance with PO Regulations, the Book Runner shall enter Bid into the System and issue to the Bidder an electronic receipt bearing name of the Book Runner, name of the bidding center, date and time. The bidding shall commence from 09:00 a.m. and close at 05:00 p.m. on all days of the Bidding Period. The bids shall be collected and entered into the system by the Book-Runner till 05:00 p.m. on the last day of the bidding period. The Bidders shall have the right: o to revise their bids upwards any time either manually through the Bid Collection Centers or electronically through direct access to the system till 05:00 p.m. on the last day of the Bidding Period The Bidders shall NOT make any downward revision or withdraw their bids as per regulation 10(2)(vi) of the PO Regulations. Page 29 of 128

32 The Book Runner shall collect full amount of the Bid Amount as Margin Money in respect of bids placed by the individual investors and not less than twenty five percent (25%) of the Bid Amount as Margin Money in respect of bids placed by the Institutional Investors. Payment of Margin Money shall be accepted only through demand draft, pay order or online transfer and third party payment instruments shall not be accepted. The Book Runner may on its own discretion accept a bid without Margin Money, provided the Book Building Portion is fully underwritten at least at the Floor Price by the Book Runner. The Book Runner may reject any bid for reasons to be recorded in writing provided the reason of rejection is disclosed to such bidder. The decision of the Book Runner shall not be challengeable by the Bidder or its associates. PSX shall, through the system, display live throughout the bidding period an order book in descending order showing demand for shares at various prices and the accumulated number of shares bid for along with percentage of the total shares issued (the Order Book ). The Order Book should also show the bids revised upwards. The Order Book shall be accessible through websites of PSX. At the close of the Bidding Period, the Strike Price shall be determined on the basis of the Dutch Auction Method. Once the Strike Price is determined, all those Bidders whose bids are found successful shall become entitled for allotment of shares. The Bidders who have made bids at prices above the Strike Price shall be allotted shares at the Strike Price and the differential shall be refunded. In case all the bids made above the Strike Price are accommodated and shares are still available for allotment, such available shares will be allotted against the bids made at the Strike Price strictly on time priority basis as per clause 7(xix)(b) of the First Schedule of the PO Regulations. The procedure for allotment of shares to successful Bidders is mentioned in para of the OFSD. The Bidders who have made bids below the Strike Price shall not qualify for allotment of any Ordinary Shares and the Book Runner shall intimate their respective banks for unblocking, where required, their Bid Money within one (1) working day of the close of the bidding period and in case of refunds, the refund to such bidders shall be made within three (3) working days from the close of the bidding period. Successful bidders shall be intimated, within one (1) working day of the closing of the bidding period, the Strike Price and the number of shares provisionally allotted to each of them. The successful bidders shall be intimated by the Book Runner of their final allocation subscription of the retail portion of the Offer. In case the retail portion of the Offer is not fully subscribed, the unsubscribed shares shall be allotted to the successful bidders on prorate basis. In case the retail portion of the Offer is oversubscribed, the portion allocated to book building investors at strike price shall be allotted to the retail investors in the manner given in para Upon intimation by the Book Runner of final allocation, successful institutional bidders shall deposit their balance margin within (3) days of such intimation. Where a successful Bidder defaults in payment of shares allotted to it, the Margin Money deposited by such Bidder shall be forfeited to the Book Runner. Final allotment of shares out of the Book Building Portion shall be made after receipt of full subscription money from the successful Bidders; however, shares to such Bidders shall be credited at the time of credit of shares out of the retail portion. The successful Bidders shall be issued shares only in Book Entry Form to be credited in their respective CDS accounts. All the bidders shall, therefore, provide their CDS account numbers in the Registration Form. Page 30 of 128

33 The Designated Institution shall continue to display on its website, the data pertaining to the Book Building and determination of the Strike Price for a period of at least three working days after closure of the Bidding Period. The Book-Runner shall ensure that subscription money received against the bids accepted shall not be released to the Offerors by the Banker to the Book Building Portion until: o o credit of all shares allotted to retail investors; and issuance of NOC by the PSX Payment for Book Building Portion The Offerors has opened a bank account for collection of applications money related to Book Building Portion. The Bidders shall draw a demand draft, pay order favoring Liberty Power Tech Book Building or online transfer of the Bid money into the respective Book Building account [Account Number] and submit the demand draft, pay order or bank receipt at the designated Bid Collection Centers either in person or through facsimile along with a duly filled in Registration Form. For online transfer the payment shall be made into the Account [Account Number] being maintained at Summit Bank [Branch] with the Account Title Liberty Power Tech Book Building. Please note that online transfer facility shall only be allowed for Summit Bank customers. CASH MUST NOT BE SUBMITTED WITH THE BIDDING FORM/REGISTRATION FORM AT THE BID COLLECTION CENTER NOR DEPOSITED DIRECTLY OR VIA ONLINE TRANSFER IN THE OFFEROR S DEISGNATED BANK ACCOUNT. BID AMOUNT MUST BE PAID THROUGH PAY ORDER, BANK DRAFT OR ONLINE TRANSFER DRAWN / TRANSFER IN FAVOR OF LIBERTY POWER TECH BOOK BUILDING IN A MANNER ACCEPTABLE TO THE BOOK RUNNER. PLEASE NOTE THAT THIRD PARTY PAYMENT INSTRUMENTS WILL NOT BE ACCEPTED. The Collection Banks shall keep and maintain the bid money in the said account. Once the shares allocated under the retail portion have been credited, the Consultant to the Offer, after obtaining NOC from PSX, may request in writing to the collection banks for transfer of the money of successful and accepted applications to the Offeror s account(s). PAYMENT PROCEDURE The payment procedures for a Limit Bid or a Step Bid are explained below: PAYMENT FOR LIMIT BID If investors are placing their bids as a Limit Bid then they shall deposit the Margin Money based on the number of shares they are bidding for at their stated bid price. For instance, if an investor is applying for 2 million shares at a price of PKR per share, then the total Application Money would amount to PKR 80 million. In such a case, (i) Individual Investor shall deposit PKR 80 million in the Book Building account as the bid amount which is 100% of PKR 80 million; and (ii) Institutional Investor shall deposit at least PKR 20 million in the Book Building account as the Margin Money which is 25% of PKR 80 million. PAYMENT FOR STEP BID If an investor is placing a Step Bid which is a series of Limit Bids at increasing prices, then he/she/it shall deposit the Margin Money / bid money based on the total number of shares he/she/it is bidding for at his/her/its stated bid prices. For instance, if the investor bids for 0.50 million shares at PKR per share, 1.00 million shares at PKR per share and 1.50 million shares at PKR per share, then in essence the investor has placed one Step Bid comprising three limit bids at increasing prices. The Application Money would amount to PKR 128 million, which is the sum of the products of the number of shares bid for and the bid price of each limit bid. In such a case, (i) Individual Investors shall deposit PKR 128 million in the Book Building Account as Margin Money which is 100% of PKR 128 million and Page 31 of 128

34 (ii) Institutional Investors shall deposit at least PKR 32 million in the Book Building Account as Margin Money which is 25% of PKR 128 million Payment by Foreign Investors Companies are permitted under paragraph 6 (with specific reference to sub para (B) (I)) of Chapter 20 of the State Bank of Pakistan s ( SBP ) Foreign Exchange Manual (the Manual ) to issue shares on repatriation basis to nonresidents who are covered under paragraph 6 (A) of Chapter 20 of the Manual, i.e. (I) A Pakistan national resident outside Pakistan, (II) A person who holds dual nationality including Pakistan nationality, whether living in or outside Pakistan, (III) A foreign national, whether living in or outside Pakistan and (IV) A firm (including a partnership) or trust or mutual fund registered and functioning outside Pakistan, excluding entities owned or controlled by a foreign government, provided the issue price, is paid in foreign exchange through normal banking channel by remittance from abroad or out of foreign currency account maintained by the subscriber/purchaser in Pakistan. Non-residents who wish to bid for the subscription of shares being offered via book building can remit the subscription money through an Authorized Dealer directly to the book building accounts opened by the Company as given in para of this OFSD, however, those non-residents who wish to subscribe shares out of the general public portion may contact any of the bankers to the issue (retail portion) for taking instructions regarding payment of subscription money against shares offered to general public / retail investors. List of bankers to the Offer for retail portion is available on page 1 and para 7.5 of this OFSD. The shares issued to non-resident shareholders shall be intimated by the Company to the designated Authorized Dealer, along with the documents prescribed in the Manual within 30 days of issue. Non-residents who are covered under paragraph 6 (A) of Chapter 20 of the Manual do not require SBP s approval to invest in the shares being issued in terms of this OFSD. Furthermore, under paragraph 7 (vii) of Chapter 20 of the Manual the Authorized Dealer shall allow repatriation of dividends, net of applicable taxes and proceeds on sale of listed shares (i.e. divestment proceeds) not exceeding the market value less brokerage/commission on provision of prescribed documents. Payments made by non-residents shall be supported by proof of receipt of foreign currency through normal banking channels. Such proof shall be submitted along with the Application by the non-residents Procedure for Rejection of Bids In terms of regulation 9(7) of the PO Regulations, the Book Runner may reject any Bid placed by a Bidder for reasons to be recorded in writing provided the reason of rejection is disclosed to such Bidder. Decision of the Book Runner shall not be challengeable by the Bidder or any of its associates Time frame for upward revision Bids by the Bidders The registered investors may revise their Bids upwards any time either manually through the Bid Collection Centres or electronically through direct access to the system till 05:00 p.m. on the last day of the Bidding Period. An investor will not be allowed to place or revise a bid with a price variation of more than 10% of the prevailing indicative strike price. NO WITHDRAWL OF BID OR DOWNWARD REVISION IS ALLOWED Procedure for Withdrawal of Offer 1. In accordance with regulation 8(16) of the PO Regulations, in case the Offeror does not receive bids for the number of shares allocated under the Book Building Portion at the Floor Price, the Offer shall be cancelled and the same shall be immediately intimated to the Commission and PSX and the Margin Money shall be refunded to the bidders immediately but not later than three (3) working days of the closing of the Bidding Period. Page 32 of 128

35 2. In accordance with regulation 8(17) of the PO Regulation, the Book Building process will be considered as cancelled if the total number of bids received is less than forty (40) Basis of Allotment Bidders shall be allowed to place bids for one hundred percent (100%) of the Offer size and the Strike Price shall be the price at which one hundred percent (100%) of the Offer is subscribed via the Dutch Auction Method. Once the Strike Price is determined, all those Bidders whose bids have been found successful shall be provisionally allotted 75% of the Offer size i.e. 94,609,014 Ordinary Shares. In order to be a successful Bidder in the Book Building process, the bid price would either be higher than the Strike Price or at the Strike Price. For allocation of shares via Book Building, priority shall be given to the bids placed at the highest price. The bidders, who have made bids at prices above the Strike Price, will be provisionally allocated 75% of the shares successfully bid for, at the Strike Price. The differential between the bid price and Strike Price, would be refunded based on the total number of shares bid for. Bidders who had placed Bids at the Strike Price will be provisionally allotted seventy-five (75%) of the shares successfully bid for, at the Strike Price, strictly on time priority basis. Bids made below the Strike Price shall not qualify for allotment of shares and their Margin Money will be refunded. The final allotment of shares to the successful bidders of the Book Building process would be determined after the determination of the extent of under subscription or over subscription of the remaining twenty-five (25%) offered to the retail investors at the Strike Price. In the event the retail portion is undersubscribed, the unsubscribed portion would be allotted to the successful bidders in the Book Building process, on a pro-rata basis. Any excess funds after subscription of the unsubscribed portion would be refunded to the bidders. As per the regulation 7(3) of the PO Regulations, in case retail portion of the offer size is oversubscribed, the portion allocated to book building investors at strike price shall be allotted to the retail investors in the manner given below: # Times retail portion oversubscribed Percentage of the offer size to be allotted to retail investors out of book building portion on proportionate basis 1 10 to 20 times 10% 2 21 to 30 times 15% 3 31 times or more 30% Final allotment of shares out of the Book Building portion shall be made after subscription of the retail portion and receipt of full subscription money from the successful Bidders; however, shares to such Bidders shall be issued simultaneously with issuance of shares to retail investors, in the form of book-entry to be credited in their respective accounts. All the Bidders shall, therefore, provide number of their respective CDS accounts in the Bid application as required under regulation 9(16) of the PO Regulations. Page 33 of 128

36 Refund of Margin Money The Bidders who have made Bids below the Strike Price shall not qualify for allotment of securities and the Book Runner shall intimate their respective banks for unblocking, where required, their Bid Money within one (1) working day of the close of the bidding period as required under regulation 9(13) of the PO Regulations and the refunds, where required to such bidders shall be made within three (3) working days from the close of the bidding period. The bid money of bidders who have undertaken to subscribe the unsubscribed retail portion shall remain deposited or blocked till allotment of unsubscribed retail portion, if any, to them on pro-rata basis Publication of Supplement to the OFSD In accordance with the regulation 11(1) of the PO Regulations, within three (3) working days of the closing of the Bidding Period, the Supplement to the OFSD shall be published at least in all those newspapers in which the OFSD was earlier published and also disseminated through PSX. The Supplement to the OFSD would contain information relating to the Strike Price, the Offer Price and Categorywise breakup of the successful Bidders along with the number of shares provisionally allocated to them. Format of the Supplement is given on page 2 of this OFSD. Public subscription for the shares shall be held at any date(s) within thirty days (30) of the publication of the OFSD but not earlier than seven (7) days of such publication Ten Percent (10%) Price Variation An investor will not be allowed to place or upward revise a bid with a price variation of more than ten percent (10%) of the prevailing Indicative Strike Price subject to floor price i.e. Bid Price must not be below the Floor Price. Please note that the Indicative Strike Price may not be constant and may keep on changing during the bidding period. Therefore, the 10% range will also change with the Indicative Strike Price. For Example, if the floor price is PKR 40.0 per share and Indicative Strike Price at any given point in time during the bidding period is PKR 40.0 per share, registered bidders may place or revise their bids from PKR 40.0 per share to PKR 44.0 per share. If at any given point in time during the bidding period, the Indicative Strike Price changes from PKR 40.0 per share to PKR 42.0 per share, the registered bidders may place or upward revise their bids from PKR 42.0 per share to PKR 46.2 per share. Please note that the 10% range on the lower side cannot go below the floor price. The price range of 10% applicable at any given point in time during the bidding period will also be displayed on the bid screen available at the website of PSX Restriction on Downward revision or withdrawal of Bids by the Bidder The Bidders shall not make downward revision or withdraw their bids as restricted under (10)(2)(vi) of the PO Regulations Associated Undertakings and Companies Associated Companies S. No Name of Company Status CUIN NTN 1 Liberty Thar Power (Private) Limited Associate Page 34 of 128

37 2 Liberty Mills Limited Sponsor Liberty Holding (Private) Limited Associate Emerald Energy Limited Associate WND Energy Limited Associate Liberty Solar Energy Limited Associate Zulaikha Energy (Private) Limited Associate Noor Solar Energy (Private) Limited Associate ZTA (Private) Limited Associate Soorty Enterprises (Pvt) Limited Sponsor Pakistan Aluminium Beverage Cans Limited Associate LML Corporation Limited Associate Liberty Steel (Private) Limited Associate Note: As required under regulation 7(8) of the PO Regulations, the Associated Companies and Associated Undertakings of the Offerors shall not in aggregate make bids for shares in excess of 5% of the Book Building Portion. Related Employees of the Company (Liberty Power Tech Limited) S. No Name Designation 1 Mr. Muhammad Salim Mukaty Chairman 2 Mr. Muhammad Ashraf Director 3 Mr. Azam Sakrani CEO 4 Mrs. Hamida Salim Mukaty Director 5 Mrs. Marzia Obaid Bawany Director 6 Mrs. Farheen Ashraf Director 7 Mrs. Nargis Shahid Soorty Director 8 Mr. Yousuf Mukaty Director 9 Mr. Adamjee Yakoob CFO 10 Mr. Tanveer Ahmed Resident Director 11 Mr. Saleem Suleman Head of Internal Audit 12 Mr. Kashif Hanif Company Secretary and Manager Finance 13 Mr. Zahid Iqbal Manager Mechanical 14 Mr. Pervaiz Iqbal Manager Admin Related Employees of the Liberty Mills Limited S. No Name Designation 1 Mr. Muhammad Salim Mukaty CEO 2 Mr. Muhammad Ashraf Director 3 Mr. Yousuf Mukaty Director 4 Mr. Noor Muhammad Mukaty Director 5 Mr. Luqman Poonawala Director 6 Mr. Madni Gul Muhammad Director 7 Mr. Asif Younus Bawany Director 8 Mr. Imran Shekhani Director 9 Mr. Haji Younus Dawood CFO 10 Mr. Iqbal Haroon Company Secretary Page 35 of 128

38 Related employees of the Consultant to the Offer (Arif Habib Limited) S. No Name Designation 1 Mr. Shahid Ali Habib Chief Executive Officer 2 Mr. Syed Kashif ul Hassan Shah MD, Investment Banking 3 Mr. Rafique Bhundi Sr. Vice President, Investment Banking 4 Mr. Ahmed Rajani Vice President, Investment Banking 5 Mr. Syed Saquib Ali Vice President, Investment Banking 6 Mr. Dabeer Hasan Sr. Associate, Investment Banking 7 Mr. Ammad Tahir Sr. Associate, Investment Banking 8 Mr. Abdul Qadir Associate, Investment Banking 9 Mr. Yasir Abbas Senior Analyst, Investment Banking 10 Mr. Omair Talib Marghoob Analyst, Investment Banking 11 Mr. Mohsin Javed Management Trainee Officer 12 Mr. Saeed Ahmed Officer, Investment Banking Related employees of the Book Runner (Ismail Iqbal Securities Pvt. Limited) S. No Name Designation 1 Mr. Ahfaz Mustafa Chief Executive Officer 2 Mr. Zaid Lodhia Head of Compliance 3 Mr. Sameer Khan Executive-Corporate Finance 4 Mr. Talha Nadeem Analyst-Corporate Finance Note: 1. As per regulation 7(9) of the PO Regulations the associates of the Consultant to the Offer and the Book Runner shall not in aggregate make bids for shares in excess of two (2) percent of the Book Building portion. 2. As required under regulation 20(10) of the PO Regulations, Related Employees of the Offeror, Consultant to the Offer and the Book Runner shall not participate in the bidding for shares. Page 36 of 128

39 Statement by the Company June 01 st, 2017 The Chief Executive Pakistan Stock Exchange Limited Stock Exchange Building Stock Exchange Road Karachi On behalf of Liberty Power Tech Limited ( LPTL or the Company ), we hereby confirm that all material information as required under the Companies Act, 2017, the Securities Act, 2015, the Public Offering Regulations, 2017 and the Listing of Companies and Securities Regulations of the Pakistan Stock Exchange Limited has been disclosed in the OFSD and that whatever is stated in the OFSD and the supporting documents is true and correct to the best of our knowledge and belief and that nothing has been concealed. For and on behalf of Liberty Power Tech Limited -Sd- Azam Sakrani Chief Executive Officer -Sd- Adamjee Yakoob Chief Financial Officer Page 37 of 128

40 Statement by Offerors June 01 st, 2017 The Chief Executive Pakistan Stock Exchange Limited Stock Exchange Building Stock Exchange Road Karachi As Offerors, we hereby confirm that all material information as required under the Companies Act, 2017, the Securities Act, 2015, the Public Offering Regulations, 2017 and the Listing of Companies and Securities Regulations of the Pakistan Stock Exchange Limited has been adequately disclosed in the OFSD and that whatever is stated in the OFSD and the supporting documents is true and correct to the best of our knowledge and belief and that nothing has been concealed. -Sd- Mr. Muhammad Salim Mukaty -Sd- Mr. Muhammad Ashraf -Sd- Mrs. Hamida Salim Mukaty -Sd- Mrs. Farheen Ashraf For and on behalf of Liberty Mills Limited -Sd- Mr. Muhammad Ashraf -Sd- Mr. Asif Younus Bawany Page 38 of 128

41 Statement by Consultant to the Offer June 15 th, 2017 The Chief Executive Pakistan Stock Exchange Limited Stock Exchange Building Stock Exchange Road Karachi Being mandated as Consultant to this Offer for Sale of Liberty Power Tech Limited through the Book Building process, I hereby confirm that all material information as required under the Companies Act, 2017, the Securities Act, 2015, the Listing of Companies and Securities Regulations of the Pakistan Stock Exchange Limited and the Public Offering Regulations, 2017 has been disclosed in the OFSD and that whatever is stated in the OFSD and in the supporting documents is true and correct to the best of my knowledge and belief and that nothing has been concealed. For and on behalf of Arif Habib Limited -sd- Syed Saquib Ali Vice President Investment Banking Page 39 of 128

42 Statement by Book Runner June 08 th, 2017 The Chief Executive Pakistan Stock Exchange Limited Stock Exchange Building Stock Exchange Road Karachi Being mandated as Book Runner to this Offer for Sale of Liberty Power Tech Limited through the Book Building process, I confirm that all material information as required under the Companies Act, 2017, the Securities Act, 2015, the Listing of Companies and Securities Regulations of the Pakistan Stock Exchange Limited and the Public Offering Regulations, 2017 has been disclosed in the OFSD and that whatever is stated in the OFSD and in the supporting documents is true and correct to the best of my knowledge and belief and that nothing has been concealed. For and on behalf of Ismail Iqbal Securities Pvt. Limited -sd- Ahfaz Mustafa Chief Executive Officer Page 40 of 128

43 2.3 SHARE CAPITAL AND RELATED MATTERS Share Capital No. of shares Face Value (PKR) Premium (PKR) Total (PKR) AUTHORIZED CAPITAL 2,000,000,000 Ordinary shares of PKR 10/- each 20,000,000,000-20,000,000,000 ISSUED, SUBSCRIBED, & PAID UP CAPITAL 504,584,055 'Ordinary shares of Rs. 10/- each 5,045,840,550-5,045,840,550 'fully paid in cash ISSUED, SUBSCRIBED & PAID-UP CAPITAL OF LIBERTY POWER TECH LIMITED AS OF MARCH 31 st, 2017: No. of shares Directors and Sponsors Face Value (PKR) Percentage held (%) 114,415,000 Mr. Muhammad Ashraf 1,144,150, % 84,373,833 Mr. Muhammad Salim Mukaty 843,738, % 45,192,122 Mrs. Farheen Ashraf 451,921, % 24,945,000 Mrs. Marzia Obaid Bawany 249,450, % 24,874,800 Mrs. Nargis Shahid Soorty 248,748, % 15,433,000 Mrs. Hamida Salim Mukaty 154,330, % Sponsors 144,700,100 M/S Liberty Mills Limited 1,447,001, % 50,650,000 M/S Soorty Enterprises 506,500, % Directors 100 Mr. Yousuf Mukaty 1, % 100 Mr. Azam Sakrani 1, % 504,584,055 Total Paid up Capital 5,045,840, % PRESENT OFFER OF ORDINARY SHARES No. of shares Allocation Face Value (PKR) Percentage (%) 94,609,014 Allocations to Institutions / Individual Investors through Book Building 946,090, % process at Strike Price 31,537,000 General Portion 315,370, % 126,146,014 Total Offer size 1,261,460, % Page 41 of 128

44 OFFERORS DESCRIPTION No. of shares Description Face Value (PKR) Divestment (%) 42,300,000 Mr. Muhammad Salim Mukaty 423,000, % 15,400,000 Mrs. Hamida Salim Mukaty 154,000, % 16,200,000 Mr. Muhammad Ashraf 162,000, % 33,691,928 Mrs. Farheen Ashraf 336,919, % 18,554,086 M/S Liberty Mills Limited 185,540, % 126,146,014 Total Offer size 1,261,460, % 1. As per regulation 5(1) of the PO Regulations, the sponsors of the Company shall retain their entire shareholding in the Company for a period of not less than twelve months from the last date for public subscription; 2. As per regulation 5(2) of the PO Regulations, the sponsors of the Company shall retain not less than twenty five percent of the paid up capital of the Company for not less than three financial years from the last date for the public subscription; 3. As per regulation 5(3) of the PO Regulations, the shares of the sponsors mentioned at (1) and (2) above shall be kept unencumbered in a blocked account with central depository; 4. Subject to compliance with sub-regulation 1 and 2 of regulation of regulation 5 of the PO Regulations and with the prior approval of the securities exchange, the sponsors of the Company may sell their shareholding through block-sale to any other person who shall be deemed sponsor for the purposes of the PO Regulations Opening and Closing of Public Subscription The subscription list will open at the commencement of banking hours on DD/MM/2017 and will close on DD/MM/2017 at the close of banking hours. Please note that online applications can be submitted 24 hours during the subscription period which will close at 12:00 midnight on DD/MM/ E-IPO System E-IPO is submission of application for subscription of securities electronically through internet, Automated Teller Machines (ATM) and mobile phones. In order to facilitate the public during IPOs / OFS, SECP has introduced the concept of e-ipo. The following two systems are available for e-ipos: I. Centralized e-ipo System In order to facilitate investors, the CDC has developed a Centralized e-ipo System ( CES ) through which applications for subscription of securities offered to the general public can be made electronically. CES has been made available in this Offer for Sale (OFS) and can be accessed through the web link Payment of subscription money can be made through 1LINK s member banks available for CES, list of which is available on above website. For making application though CES, investors must be registered with CES. Registration with CES is free of cost and can be done under a self-registration process by filling the CES registration form, which is available 24/7 all around the year. Page 42 of 128

45 Investors who have valid Computerized National Identity Card (CNIC), bank account with any of the commercial bank, address, mobile phone number and CDS Account (Investor account or sub account) may registered themselves with CES. Investors who do not have CDS account may visit for information and details. For further guidance and queries regarding CES and opening of CDS account, investors may contact CDC at phone number: (CDCPL) and Investors who are registered with CES can submit their applications through the web link 24 hours a day during the subscription period which will close at midnight on DD/MM/2017. II. E-IPO Facilities by Bankers to the Offer Currently, United Bank Limited (UBL), Summit Bank Limited (SMBL) and Bank Alfalah (BAFL) are providing e-ipo facilities to their respective accountholders. UBL account holders can use UBL Net Banking to submit their application via link SMBL account holders can use SMBL Net Banking to submit their application via link and BAFL account holders can use BAFL Net Banking to submit their application via link: Benefits of e-ipo E-IPO has the following benefits: I. It enables the investors to make application for subscription of shares through the internet without going to the bank, and waiting in long queues. II. It is efficient and simultaneously facilitative for both the Issuer and the investors. III. It is available for use 24 hours during the subscription period. IV. If you are registered with CES or accountholder of a bank providing e-ipo facility, you may get SMS for new IPOs. V. By applying through CES you can also track your application status Eligibility of Investor for Investment in this Offer Eligible investors include: 1. Pakistani citizens resident in or outside Pakistan or persons holding dual nationalities including a Pakistani Nationality; 2. Foreign nationals whether living in or outside Pakistan; 3. Companies, bodies corporate or other legal entities incorporated or established in or outside Pakistan (to the extent permitted by their respective constitutive documents and existing regulations, as the case may be); 4. Mutual Funds, Provident / Pension / Gratuity Funds / Trusts (subject to the terms of their respective Trust Deeds and existing regulations); and 5. Branches in Pakistan of companies and bodies corporate incorporated outside Pakistan. Page 43 of 128

46 2.3.6 Facilities available to Non-Resident Pakistani and Foreign Investors Companies are permitted under paragraph 6 (with specific reference to sub para (B) (I)) of Chapter 20 of the State Bank of Pakistan s ( SBP ) Foreign Exchange Manual (the Manual ) to issue shares on repatriation basis to nonresidents who are covered under paragraph 6 (A) of Chapter 20 of the Manual, i.e. (I) A Pakistan national resident outside Pakistan, (II) A person who holds dual nationality including Pakistan nationality, whether living in or outside Pakistan, (III) A foreign national, whether living in or outside Pakistan and (IV) A firm (including a partnership) or trust or mutual fund registered and functioning outside Pakistan, excluding entities owned or controlled by a foreign government, provided the offer price, is paid in foreign exchange through normal banking channel by remittance from abroad or out of foreign currency account maintained by the subscriber/purchaser in Pakistan. Non-residents who wish to bid for the subscription of shares being offered via book building can remit the subscription money through an Authorized Dealer directly to the book building accounts opened by the Offerors as given in section of this OFSD, however, those non-residents who wish to subscribe shares out of the general public portion may contact any of the bankers to the Offer (retail portion) for taking instructions regarding payment of subscription money against shares offered to general public. List of bankers to the Offer for retail portion is available on page 1 and Section 7.4 of this OFSD. The shares issued/transferred to non-resident shareholders shall be intimated by the Company to the designated Authorized Dealer, along with the documents prescribed in the Manual within 30 days of issue/transfer. Non-residents who are covered under paragraph 6 (A) of Chapter 20 of the Manual do not require SBP s approval to invest in the shares being offered in terms of this OFSD. Furthermore, under paragraph 7 (vii) of Chapter 20 of the Manual the Authorized Dealer shall allow repatriation of dividends, net of applicable taxes and proceeds on sale of listed shares (i.e. divestment proceeds) not exceeding the market value less brokerage/commission on provision of prescribed documents. Payments made by non-residents shall be supported by proof of receipt of foreign currency through normal banking channels. Such proof shall be submitted along with the application by the non-residents Minimum amount of Application and Basis of Allotment of Shares out of the General Public Portion of the Offer The basis and conditions of allotment to the general public shall be as follows: 1. Application for shares must be made for 500 shares or in multiples of 500 shares only. Applications which are neither for 500 shares nor for multiples of 500 shares shall be rejected. 2. The minimum amount of application for subscription of 500 shares is the Offer Price x 500 shares. Any cost incurred in transfer of shares as part of the Offer shall be borne by Offeror. 3. Application for shares below the minimum amount shall not be entertained. 4. SUBMISSION OF FALSE AND FICTITIOUS APPLICATIONS IS PROHIBITED AND SUCH APPLICATIONS MONEY MAY BE FORFEITED UNDER SECTION 87(8) OF THE SECURITIES ACT, If the shares offered to the general public are sufficient to accommodate all applications, all applications shall be accommodated. 6. In case retail portion of the Offer, remains unsubscribed, the unsubscribed shares shall be allotted to successful bidders at the strike price on pro-rata basis. 7. Incase retail portion of the Offer is oversubscribed, the portion allocated to Book Building investors at strike price shall be allotted to the retail investors in the form and manner as provided in para of this OFSD. 8. If the shares applied for by the general public are in excess of the shares being issued to them, the distribution shall be made by computer balloting, in the presence of the representative(s) of PSX in the following manner: Page 44 of 128

47 If all applications for 500 shares can be accommodated, then all such applications shall be accommodated first. If all applications for 500 shares cannot be accommodated, then balloting will be conducted among applications for 500 shares only. If all applications for 500 shares have been accommodated and shares are still available for allotment, then all applications for 1,000 shares shall be accommodated. If all applications for 1,000 shares cannot be accommodated, then balloting will be conducted among applications for 1,000 shares only. If all applications for 500 shares and 1,000 shares have been accommodated and shares are still available for allotment, then all applications for 1,500 shares shall be accommodated. If all applications for 1,500 shares cannot be accommodated, then balloting will be conducted among applications for 1,500 shares only. If all applications for 500 shares, 1,000 shares and 1,500 shares have been accommodated and shares are still available for allotment, then all applications for 2,000 shares shall be accommodated. If all applications for 2,000 shares cannot be accommodated, then balloting will be conducted among applications for 2,000 shares only. After the allotment in the above mentioned manner, the balance shares, if any, shall be allotted in the following manner: o If the remaining shares are sufficient to accommodate each application for over 2,000 shares, then 2,000 shares shall be allotted to each applicant and remaining shares shall be allotted on pro-rata basis. o If the remaining shares are not sufficient to accommodate all the remaining applications for over 2,000 shares, then balloting shall be conducted for allocation of 2,000 shares to each successful applicants. 9. If the Offer is over-subscribed in terms of amount only, then allotment of shares shall be made in the following manner: First preference will be given to the applicants who applied for 500 shares; Next preference will be given to the applicants who applied for 1,000 shares; Next preference will be given to the applicants who applied for 1,500 shares; Next preference will be given to the applicants who applied for 2,000 shares; and then After allotment of the above, the balance shares, if any, shall be allotted on pro rata basis to the applicants who applied for more than 2,000 shares. 10. Allotment of shares will be subject to scrutiny of applications for subscription of shares. Applications, which do not meet the above requirements, or applications which are incomplete, will be rejected Refund/Unblocking of Subscription Money to Unsuccessful Applicants As per the regulation 11(4) of the PO Regulations, within 10 days of the close of public subscription period the Shares shall be allotted and issued against the accepted and successful applications and the subscription money of the unsuccessful applicants shall be unblocked/ refunded. As per sub-section (2) of Section 68 of the Companies Act, if refund as required under sub-section (1) of Section 68 of the Companies Act is not made within the time specified hereinabove, the directors of the company shall be jointly and severally liable to repay that money with surcharge at the rate of two percent (2%) for every month or part thereof from the expiration of the fifteenth day and, in addition, shall be liable to a penalty of level 3 on the standard scale as defined in Section 479 of the Companies Act. Provided that the directors of the Company shall not be liable if it proves that the default in making the refund was not on their own account and was not due to any misconduct or negligence on their part. Page 45 of 128

48 In case retail portion of the Offer, if any, remains unsubscribed, the unsubscribed shares shall be allotted to successful bidders at the strike price determined in the book building process on pro-rata basis Issue and Credit of Share Certificates Within ten (10) days of the close of public subscription period, the shares shall be allotted and issued against the accepted and successful applications and the subscription money of the unsuccessful applicants shall be unblocked/refunded, as required under regulation 11(4) of the PO Regulations. Shares will be issued only in the book-entry form. Therefore, the applicants must provide their CDS account Number in the Applicant Form. The Company shall credit shares, within ten (10) days of the closing of public subscription, in the respective CDS accounts of the successful applicants. If the Company defaults in complying with the above requirements, it shall pay the PSX a penalty of PKR 5,000 per day for every day during which the default continues. The PSX may also notify the fact of such default and the name of the Company by notice and also by publication in its ready-board quotation of the Stock Exchange. The name of the Company will also be notified to the TRE Certificate Holders of the PSX and placed on the web site of the PSX Transfer of Shares The shares shall be transferred in accordance with the provisions of Section 74 of the Companies Act read with Section 75 thereof and the Central Depositories Act, 1997 and the CDCPL Regulations. The transfer fees shall be borne by the Offerors Shares Issued in Preceding Years S. No No. of Shares Issued Consideration Total Value (PKR) Date of Issuance 1. 6,000 Cash 60,000 Sep ,000 Cash 5,040,000 Jun ,490,000 Cash 94,900,000 Sep ,000,000 Cash 60,000,000 Nov ,000,000 Cash 40,000,000 Feb ,000,000 Cash 160,000,000 Feb ,000,000 Cash 360,000,000 Mar ,722,018 Cash 317,220,180 Mar ,010,349 Cash 50,103,490 Mar ,000,000 Cash 100,000,000 Jun ,000,000 Cash 50,000,000 Aug ,000,000 Cash 50,000,000 Sep ,000,000 Cash 200,000,000 Oct ,500,000 Cash 175,000,000 Dec ,000,000 Cash 300,000,000 Dec ,000,000 Cash 50,000,000 Dec ,000,000 Cash 200,000,000 Jan ,000,000 Cash 100,000,000 Feb ,700,000 Cash 687,000,000 Mar ,000,000 Cash 100,000,000 Mar-10 Page 46 of 128

49 21. 20,000,000 Cash 200,000,000 Mar ,000,000 Cash 80,000,000 Mar ,000,000 Cash 570,000,000 Apr ,000,000 Cash 150,000,000 Jun ,000,000 Cash 100,000,000 Jun ,000,000 Cash 120,000,000 Jun ,000,000 Cash 100,000,000 Jul ,000,000 Cash 220,000,000 Sep ,500,000 Cash 25,000,000 Nov ,200,000 Cash 162,000,000 Dec ,951,688 Cash 219,516,880 Nov ,584,055 5,045,840,550 Other than the above mentioned shares, there has been no issuance of shares since the incorporation of the Company Principal Purpose of the Offer The principal purpose of the Offer for Sale of Shares is to list the Company on the Pakistan Stock Exchange and to broaden its shareholder base by offering shares to the general public, HNWI & Institutions. Listing of the Company would result in improving the corporate governance structure of the Company Interest of Shareholders None of the holders of the Issued shares of the Company have any special or other interest in the property or profits of the Company other than as holders of the Ordinary shares in the capital of the Company, except to the extent of loans provided by the shareholders to the Company where the shareholders interest would also include mark-up on their loans Dividend Policy The Company intends to follow a consistent profit distribution policy for its members, subject to profitability, availability of adequate cash flows, Board of Director s recommendation, shareholders approval and satisfaction of certain financial covenants. The rights in respect of capital and dividends attached to each share are and will be the same. The Company in its general meeting may declare dividends but no dividend shall exceed the amount recommended by the Directors. Dividend, if declared in the general meeting, shall be paid according to the provisions of the Companies Act. The Directors may from time to time declare interim dividends as appear to the Directors to be justified by the profits of the Company. No dividend shall be paid otherwise than out of the profits of the Company for the year or any other undistributed profits. No unpaid dividend shall bear interest or mark-up against the Company. The dividends shall be paid within the period laid down in the Companies Act. Those applicants who intend that their cash dividend, if any, is directly credited in their Bank Account, must fill-in the relevant part of the Shares Subscription Form under the heading, "Dividend Mandate Option". Page 47 of 128

50 The Company has issued following dividends over the past years to the existing shareholders. Particulars FY12 FY13 FY14 FY15 FY16 For the nine month ended March 2017 Dividend (PKR) / share N/A The Company may declare dividends upon recommendation of the Directors, however prior payment approval from Intercreditor Agent will be sought as stated in Common Terms Agreements dated February 18th, Eligibility for Dividend The shares issued shall rank pari-passu with the existing shares in all matters of the Company, including the right to such bonus or right issues, and dividend as may be declared by the Company subsequent to the date of issue of such shares. The Company has already paid an interim dividend of PKR 7.0 per share for the period ended March 31 st, Further, the Company may announce a final dividend for the period ended June 30 th, The Offerors have waived-off their right of receiving the dividend on 25% shares in favour of the successful new investors in Book Building and the General Public portion Deduction of Zakat Income distribution will be subject to deduction of Zakat at source, pursuant to the provisions of Zakat and Ushr Ordinance, 1980 (XVIII of 1980) as may be applicable from time to time except where the said ordinance does not apply to any shareholder or where such shareholder is otherwise exempt or has claimed exemption from payment / deduction of Zakat in terms of and as provided in that ordinance Capital Gains Tax Capital gains derived from the sale of listed securities are taxable in the following manner under section 37A of Income Tax Ordinance, 2001: Category Tax Year Less than twelve months Tax Rate FY 2017 Holding Period of Securities Twelve months or more but less than twenty four months Twenty four months or more but acquired on or after 1st July, 2012 Before 1st July, 2012 Filer % 12.50% 7.50% 0% Non - Filer % 16.00% 11.00% 0% Category Tax Year Less than twelve months From Tax Rate FY 2018 (Budget FY17-18) Holding Period of Securities Twelve months or more but less than twenty four months Twenty four months or more but acquired on or after 1st July, 2012 Before 1st July, 2013 Filer % 15.00% 15.00% 0% Non - Filer % 20.00% 20.00% 0% Page 48 of 128

51 Withholding Tax on Dividends Dividend distribution to shareholders will be subject to withholding tax under section 150 of the Income Tax Ordinance, 2001 as specified in Part III Division I of the First Schedule of the said ordinance or any time to time amendments therein. In terms of the provision of Section 8 of the said ordinance, said deduction at source, shall be deemed to be full and final liability in respect of such profits in case of individuals only. The following are the rates: For filers of Income Tax Returns: 7.5% For non-filers of Income Tax Return: 7.5% Tax on Bonus Shares As per section 236M of the Income Tax Ordinance 2001, tax at the rate of 5.00% of the value of bonus shares determined on the basis of the day end ex-price be collected by the Company issuing the bonus shares, which will be the final tax liability on such income of the shareholder Income Tax The profits and gains of the Company derived from electric power generation are exempt from tax under terms of clause 132 of Part-I of the second schedule to the Income Tax Ordinance, The taxation expense of PKR million appearing in the Financial Statements pertains to income from sources other than the income from power generation Deferred Taxation The profits and gains of the Company derived from electric power generation are exempt from tax under terms of clause 132 of Part-I of the second schedule to the Income Tax Ordinance, Therefore no provision for deferred taxation is required to be made by the Company. Deferred tax liability of PKR 8.5 million as appearing in the Financial Statements pertains to unrealized gain on remeasurement of investments Sales Tax Sales Tax is applicable on fuel purchased and electricity produced at the rate prescribed by Government in Sales tax act. Sales Tax on sales invoices is applicable at 17%, whereas Sales Tax on purchase of furnace oil is applicable at 20% Sales Tax on Sale / Purchase of Shares Under the Constitution of Pakistan and Articles 49 of the 7th NFC Award, the Government of Sindh, Government of Punjab, Government of Khyber Pakhtunkhwa and Government of Baluchistan have promulgated the Sindh Sales Tax on Services Act, 2011, Punjab Sales Tax on Services Act, 2012, Khyber Pakhtunkhwa Sales Tax on services through Khyber Pakhtunkhwa Finance Act, 2013 and the Baluchistan Sales Tax on Services Act, 2015 respectively. The Sindh Revenue Board, the Punjab Revenue Authority, and the Khyber Pakhtunkhwa Revenue Authority and the Baluchistan Revenue Authority administer and regulate the levy and collection of the Sindh Sales Tax ( SST ), Punjab Sales Tax ( PST ), Khyber Pakhtunkhwa Sales Tax ( KST ) and Baluchistan Sales Tax ( BST ) respectively on the taxable services provided or rendered in Sindh, Punjab, Khyber Pakhtunkhwa or Baluchistan provinces respectively. The value of taxable services for the purpose of levy of sales tax is the gross commission charged from clients in respect of purchase or sale of shares in a Stock Exchange. The above mentioned Acts levy a sales tax on Brokerage Page 49 of 128

52 at the rate of 13% in Sindh, 16% in Punjab and in Baluchistan and in Khyber Pakhtunkhwa the rate is 15%. Sales tax charged under the aforementioned Acts is withheld at source under statutory requirements Capital Value Tax (CVT) on Purchase of Shares Pursuant to amendments made in the Finance Act, 1989 through Finance (Amendments) Ordinance, 2012 promulgated on April 24, 2012, 0.01% Capital Value Tax applicable on the purchase value of shares Tax Credit for Investment in IPO Under Section 62 of the Income tax Ordinance, 2001, a resident person other than a Company, shall be entitled to a tax credit, as mentioned in the said section, for a tax year in respect of the cost of acquiring in the year, new shares offered to the public by a public company listed on a stock exchange in Pakistan, provided the resident person is the original allottee of the shares or the shares are acquired from the Privatization Commission of Pakistan. As per section 62(3)(b) of the Income Tax Ordinance, 2001, the time limit for holding shares has been designated as 24 months to avail tax credit Tax Credit for Enlistment Upon enlistment under Section 65C of the Income Tax Ordinance, 2001, tax credit at 20% of the tax payable shall be allowed for the tax year in which a Company is listed on PSX and also extended for the following three tax years of enlistment through Finance Bill Provided that the tax credit for the last two years shall be 10% of the tax payable. Page 50 of 128

53 3 UNDERWIRTING, COMMISSIONS, BROKREAGE AND OTHER EXPENSES 3.1 UNDERWRITING Book Building Portion Ismail Iqbal Securities (Pvt.) Limited has been mandated as the Book Runner to the Offer. The Book Runner shall underwrite 126,146,014 Ordinary shares subscribed through the book building representing 100% of the Offer as required under regulation 7(6) of the PO Regulations, with the limitations in effect that the Book Runner shall only underwrite the default portion of the Book Building, if any, at the Strike Price determined through the Book Building process. General Public Portion The General Public Portion of the Offer of 31,537,000 Ordinary Shares (25%) shall not be underwritten in terms of regulation 7(4) of the PO Regulations. 3.2 OPINION OF DIRECTORS REGARDING RESOURCES OF THE UNDERWRITERS In the opinion of the Directors, the resources of the Book Runner are sufficient to discharge its underwriting commitments / obligations. 3.3 UNDERWRITING COMMISSION Book Building Portion No underwriting commission shall be paid for the amount of the Book Building portion underwritten by the Book Runner. The amount of security deposited by the defaulting Bidder shall however, be forfeited to the Book Runner. 3.4 BUY BACK / REPURCHASE AGREEMENT THE UNDERWRITERS HAVE NOT ENTERED INTO ANY BUY BACK / RE-PURCHASE AGREEMENT WITH THE COMPANY OR ANY OTHER PERSON IN RESPECT OF THIS OFFER FOR SALE. ALSO, NEITHER THE COMPANY NOR ANY OF ITS ASSOCIATES HAVE ENTERED INTO ANY BUY BACK / RE-PURCHASE AGREEMENT WITH THE UNDERWRITERS OR THEIR ASSOCIATES. THE COMPANY AND ITS ASSOCIATES SHALL NOT BUY BACK / RE-PURCHASE SHARES FROM THE UNDERWRITERS AND THEIR ASSOCIATES. 3.5 COMMISSION OF THE BANKERS TO THE OFFER Commission at the rate of 0.25% of the amount collected on allotment in respect of successful applicants will be paid by the Company to the Bankers to the Offer for services to be rendered by them in connection with the general public offering, plus out-of-pocket expenses, if any. 3.6 FEES AND EXPENSES FOR CENTRALIZED E- IPO SYSTEM ( CES ) Commission on application received through CES will be paid to CDC which shall not be more than 0.8% of the amount of the successful applications. CDC will share, the fee with other participants of CES at a ratio agreed amongst them. Page 51 of 128

54 3.7 BROKREAGE For this Offer, brokerage shall be paid to the TRE Certificate Holders of Pakistan Stock Exchange Limited at the rate of 1.00% of the value of shares (including premium, if any) on successful applications for Book Building and General Public Portion. No brokerage shall be payable in respect of shares taken up by the Successful Bidders pursuant to the under subscription of retail portion of the Offer. 3.8 ESTIMATED EXPENSES OF THE OFFER Expenses to the Offer are estimated not to exceed PKR 207,794,820/-. The break-up of these preliminary expenses is given below: Particulars Rate Expense 1 Advisory and Book Runner Fee % 131,191,854 Commission to Bankers for General Public % 3,153,650 e-ipo Facility Charges 775,000 Bankers to the Offer Out of Pocket 440,000 Brokers' Commission % 50,458,406 PSX Initial Listing Fees 2,500,000 PSX Annual Listing Fees 605,550 PSX Services Fee 50,000 PSX Book Building Software charges 500,000 Transfer Agent and Balloting Agent 150,000 Marketing & Printing Expenses 6,000,000 CDC - Fresh Offer Fees % 8,073,345 CDC - Annual Listing Fees 400,000 SECP IPO Application Processing Fee 1,761,460 SECP Supervisory Fee 310,555 Legal Advisory 375,000 Shari ah Advisor Fee 50,000 Miscellaneous Expenses 1,000,000 Total 207,794,820 Except for the initial listing fee, annual listing fee and SECP supervisory fee related expenses, all other expenses will be borne by the Offerors. 1 These amounts do not include Sindh Sales Tax, as mentioned in Section , wherever applicable 2 Represent the maximum amount that is expected to be paid based on the Floor Price of PKR 40/- per share Page 52 of 128

55 4 OVERVIEW, HISTORY & PROSPECTS 4.1 COMPANY HISTORY & OVERVIEW Liberty Power Tech Limited ( LPTL or the Company ) is a public limited Company incorporated under the Companies Act, 2017 (formerly the Companies Ordinance 1984). The Company was established with a power plant based on Combined Cycle / 4 Stroke Diesel Engine technology. The name plate capacity is approximately 202 MW gross at ISO and MW (net at site reference conditions) at 132 kv Bus Bar in terms of the Policy for Power Generation Projects 2002 (the Policy ). The Power Plant is located at Faisalabad in the Punjab Province. The electricity generated is sold to the Central Power Purchasing Agency (CPPA) within NTDC. The Company is an Independent Power Producer (IPP) under the Power Policy It started commercial operations in January The Company operates a Residual Fuel Oil (RFO) based thermal power plant with a net capacity of MW. The total project cost was PKR 20,183 million (USD: 240 million) with a debt to equity ratio of 75:25. LPTL majority is owned by Liberty Group (Liberty Mills Limited: 29% & Mukaty Family: 61%) and Soorty Enterprises (10%). As the Company operates in the regulated power sector, it enjoys a sovereign guarantee against receivables from power purchaser CPPA given adherence to agreed performance benchmarks. The Company's operations and maintenance operator, Wartsila Pakistan (WPK), is a key source of comfort in managing the plant's operations. The project will continue till the tenor of the PPA (25 years), after which the plant will remain the property of LPTL. The actual cost of the project was PKR 20,183 million (USD 240 million) Key Milestones Years September 2007 February 2008 April 2008 April 2008 June 2008 June 2008 July 2008 August 2008 Events The Company was incorporated under the Companies Act, 2017 (formerly Companies Ordinance, 1984) and was issued with incorporation certificate by Securities and Exchange Commission of Pakistan Nepra issued determination of authority in the matter of generation tariff for the Company The Company was granted Generation License by Nepra under Regulation of Generation, Transmission and Distribution of Electric Power Act, 1997 and it is valid until December 2035 Private Power and Infrastructure Board issued to the Company the Letter of Support (LOS) for the design, engineering, construction, insuring, commissioning, operation and maintenance of the generation complex The Company was awarded with entitlement to commence business by Securities and Exchange Commission of Pakistan The Company entered into the Implementation Agreement with Government of Pakistan which guarantees payments to the Company if defaulted by the Power Purchaser The Company executed Power Purchase Agreement with National Transmission and Dispatch Company Limited for a period of 25 years and it sets forth the contractual terms of the sale and purchase of electricity between the two parties Execution of EPC Contract with Wartsila Finland Page 53 of 128

56 February 2009 February 2009 March 2009 July 2010 July 2010 July 2010 January 2011 August 2011 May 2015 The Company entered into a Musharaka Agreement with Allied Bank Limited and Financial Institutions (Contributing Certificate Holders) in order to obtain a senior Islamic debt facility The Company entered into Syndicate Finance Agreement with Askari Bank Limited and Allied Bank Limited in order to obtain a secondary finance facility for the Project The Company successfully achieved the Financial Close The Company entered into Operation & Maintenance (O&M) Agreement (1 st Term) with Wartsila Pakistan (Private) Limited for a period of five years, where the Company appointed O&M contractor to operate and maintain its generation facility The Company executed Amended Musharaka Agreement to enhance the Musharaka contributing amount due to foreign exchange fluctuations The Company entered into Amended Syndicate Finance Agreement to enhance the financing facility to due to foreign exchange fluctuations Commercial Operation Date (COD) Nepra issued a revised tariff for adjustments proposed by the Company The Company renewed its Operation and Maintenance Agreement (2 nd term) with Wartsila Pakistan (Private) Limited and the Agreement is valid for a period of six years 4.2 PATTERN OF SHAREHOLDING The major shareholding of the Company is owned by Liberty Group through Liberty Mills Limited and Mukaty family. Major shareholders of the Company includes Mr. Muhammad Ashraf holding 23%, Mr. Muhammad Salim Mukaty holding 17%, M/S Liberty Mills Limited holding 29% and M/S Soorty Enterprises holding 10% of the total Paid up Capital. A summary of shareholding pattern according to different categories of shareholders is given below: Description Number of shares Face Value Percentage holding Total Paid Up Capital Shares held by Directors / Sponsors of the Company 309,233,955 3,092,339,550 61% Share held by Sponsors 144,700,100 1,447,001,000 29% Shares held by Other Shareholders 50,650, ,500,000 10% 4.3 REVENUE AND COST DRIVERS Revenue generated from IPPs based on furnace oil is basically a function of tariff contracted with NTDC, available capacity of the Plant and actual number of units produced. Nepra policies are imperative in this regard. Following are key revenue and cost drivers of the Company: KEY REVENUE DRIVERS 1. Sole Customer for Twenty Five Years The Company has entered into a Power Purchase Agreement with NTDC through CPPA. The Agreement stipulates the contractual terms of the sale and purchase of electricity between the Company and NTDC. Its term is for a period of 25 years. For the contractual period of the Agreement, the Power Purchaser is obliged to purchase electricity. The Company is guaranteed capacity payments, which is the main principal source of income, provided the Plant was available for generation. Page 54 of 128

57 2. Guaranteed USD Return The Company s return is guaranteed by Government of Pakistan through Implementation Agreement. The Company has been guaranteed a USD based IRR of 15% irrespective of dispatch or generation of electricity provided the Plant is available for dispatch. 3. Growing Economy of Pakistan Pakistan s Economy is expanding at its highest level since 8 years. Government s friendly policies and induction of CPEC projects has provided an opportunity for revival of the economy. This drive of economic, commercial and industrial activity is bound to create a surge in demand for an already overloaded energy system of the Country. A constant supply of energy is considered a backbone of the growth. Thus, expected expansion in the economy will ensure Government s reliance over IPPs to fulfill the energy demand of the Country. KEY COST DRIVERS Under the Power Purchase Agreement with NTDC, all the costs necessary to incur in order to run the Plant smoothly are comprehended in the tariff and are considered pass through costs. However major cost drivers are given below: 1. Residual Furnace Oil Cost LPTL operates the Power Plant based on residual furnace oil. RFO, being the main component, makes up a large portion of total fuel cost. The fuel cost is covered under Energy Purchase Price component of the tariff and is subject to quarterly review. 2. Operational and Maintenance Cost The operational and maintenance cost is imperative for smooth running of the Power Plant. The Company has to make Plant available in order to secure Capacity payments from the Government which is the main source of income. The Company has entered into an agreement with O&M contractor under which operator shall be responsible for the operations and maintenance of the facility as are necessary to operate and maintain the Plant. The Contractor guarantees the annual availability of the Facility shall not be less than 92%. 4.4 THE PROJECT Plant Location The Power Plant site is located at a distance of five kilometers (5 km) on Sahianwala Chiniot Road, off Sahianwala Interchange on M-3 Motorway (Pindi-Bhattian Faisalabad Motorway). Its distance from Faisalabad is 28 km and from Chiniot is 25 Km. The New Express way to Faisalabad is 5 Km away from the generation site. The Plant site co-ordinates are N latitude and E longitude. The key advantage of the site is its close proximity to the major load center of M3 industrial city, Faisalabad (FIEDMC), FIEDMC is one of the largest industrial zone of Pakistan. The power generated is transmitted through four 132-KV interconnection lines to NTDC, first line to M3 Industrial City (FIEDMC), second 132KV line Nishatabad Faisalabad, third line 132KV line to Kamalpur Chiniot and fourth 132kv Line to Chak 126 Sargodha. Complex Site comprises of 25 acres of Freehold Land at Mitranwali, Tehsil and District Faisalabad. The Plant site is connected through road to the M3 Motorway and to Chiniot city. The land is 200 meters above of sea level. The Complex land area is flat having overall better ground water quality in the surroundings area, ample water resources, close by drain water facility and better road network connectivity. Page 55 of 128

58 4.4.2 About the Plant LPTL operates on Stationary Plant equipped with of 11 engines WARTSILA 4 stroke 18V46 Diesel engines (made in Finland) and 1 Steam Turbine GE with a gross capacity of MW. The power plant at the time of its purchase were new and first-hand. The power plant is based on Residual Fuel Oil (RFO) and comprises of eleven Residual Fuel Oil fired generators having a capacity of MW each, along with a steam turbine MW. Net rated capacity, after accounting for auxiliary consumption, is MW. Plant configuration is given in the following table: Plant Size Installed Capacity (Gross ISO) Type of Technology Number of Units / Size (MW) Unit Make and Model De rated Capacity at Mean Site Conditions Auxiliary Consumption Commissioning and Commercial Operation Date Expected life of the Facility from Commercial Operation Date MW Reciprocating Engines Reciprocating Engines: 11 x MW Steam Turbine: 1 x MW Reciprocating Engines Wärtsilä 18V46 Steam Turbine General Electric MW ( = ) 4.10 MW January 13, Years Plant Characteristics are given in the following table: Generation Voltage Frequency 15 kv 50 Hz Power Factor 0.8 Automatic Generation Control Ramping Rate Time required to synchronize to Grid and loading the complex to full load Cooling Water Source / Cycle Yes Complex (Hot Start) = KW/sec Diesel Engine = 15 KW / sec. Without Steam Turbine Hot Start = 30 mins, Cold Start = 120 mins, Dead Start = 480 mins For Steam Turbine: 120 mins Tube wells / Closed Cycle The Equipment is designed to operate within the following ambient conditions: Altitude above sea level Wet Bulb temperature 200 m 24 o C Page 56 of 128

59 Minimum ambient air temperature Maximum ambient air temperature 5 o C 50 o C Fuel details are given in the below table: Primary fuel Back-up fuel (emergency / start up only) Fuel source (imported / indigenous) No. of storage tanks Residual Fuel Oil (RFO) High Speed Diesel (HSD) Local / Imported Primary Fuel (RFO) Back-up Fuel (HSD) 3 1 Storage capacity of each tank 10,000 m 3 2,000 m 3 Gross Storage 30,000 m 3 2,000 m Tariff Structure NEPRA has determined cost plus tariff in accordance with the Power Policy 2002 for LPTL for the period of twentyfive (25) from Commercial Operation Date under the PPA. Under the aforesaid policy, the Company is guaranteed USD IRR of 15% irrespective of dispatch or generation of electricity provided the plant is available for dispatch. Tariff structure is classified into two components: 1. Variable Charges / Energy Purchase Price which consists of Fuel Price and Variable Operation and Maintenance. Any variation in Fuel Price are passed to the Power Purchaser while variable O&M is subject to indexed for variation in exchange rate and Local / US CPI thus hedging the Company against the exchange and inflation risk. 2. Fixed Charges / Capacity Purchase Price is independent of capacity utilization of the plant such as debt servicing, return on equity, return on equity during construction, fixed O&M costs, cost of working capital, insurance and withholding tax on dividend. Accordingly, equity return for investors is guaranteed regardless of capacity utilization. These capacity price components except insurance are subject to indexed with US / Local CPI, variation in Ex-Rate and KIBOR which is mitigating potential risks of the Company. The insurance component is being adjusted annually on actual basis. Apart from that, the Power Purchaser is required to reimburse any adverse change in taxes and duties pursuant to the relevant provision of PPA. Page 57 of 128

60 The table below illustrates the tariff structure determined by NEPRA for the quarter ended March 2017 based on Initial Dependable Capacity assessed as MW: Energy Purchase Price EPP Tariff Component (PKR / kwh) Fuel Variable Local O&M Variable Foreign O&M Total EPP Fixed Local O&M Fixed Foreign O&M Cost of Working Capital Capacity Purchase Price CPP Insurance ROE and ROEDC Withholding tax Debt components Total CPP Total (PKR / kwh) Capacity and Production 1 Theoretical maximum output [based on 8,760 hours (2015 & 2016: 8,760 hours) (24 hour / day; 365 days) For the year ended June, 2016 MWH For the year ended June, ,718,178 1,718,178 Total output 1,249,883 1,514,552 Capacity Factor 73% 88% Theoretical maximum output is of 365 days (2015 & 2016: 365 days). The Capacity factor calculated above is total gross net generation of 365 days (2015 & 2016: 365 days) over theoretical maximum output of 365 days (2015 & 2016: 365 days) Theoretical maximum output [based on 4,416 hours (2015: 4,416 hours)] For the nine months period ended March, 2017 MWH For the nine months period ended March, ,289,777 1,294,484 Total output 984, ,648 Capacity Factor 76% 74% Theoretical maximum output is of 274 days (2016: 275 days). The Capacity factor calculated above is total gross generation of 274 days (2016: 275 days) over theoretical maximum output of 274 days (2016: 275 days). 1 Figures for theoretical maximum output, total output and load factor for the year ended FY16 & FY15 and for the nine months period ended March, 2017 & 2016 are taken from Company s financial statements Page 58 of 128

61 4.4.5 Project Cost Total Cost of the Project at COD was PKR 20,183 million (USD: 240 million) which was financed through debt of PKR 15,137 million and equity of PKR 5,046 million. A brief summary of the Project cost is given below: Description Cost as at the time of COD (PKR Million) EPC cost Wartsila 15,534 Taxes and custom duty (5% offshore & 6% onshore) 548 Emergency and safety spare parts 208 Pre-COD insurance cost 188 Financing charges 437 Profit during construction 2,186 EPC cost - Non-Wartsila 218 Staff housing colony cost 106 Land acquisition and land development cost - 25 acres 104 Sponsors' development cost 124 Pre-COD O&M mobilization cost 173 Start-up expenses and utilities 58 Sub Total 19,884 Others (NEPRA un approved and working capital etc.) 299 Total 20, Project Financing Debt financing constitutes 75% of the project cost. In this regard, a senior Islamic facility, denominated in PKR, was arranged along with a long term finance facility. The senior Islamic facility was arranged through a Sukuk issue based on Ijarah tul Musharaka by a Consortium of banks led by Allied Bank Limited. The size of Sukuk was PKR 13,588 million and size of long term facility was PKR 1,662 million amounting to a total of PKR 15,250 million. The aggregate unavailed long term financing facilities at the time of COD amounted to PKR 113 million. The facilities tenor is 12 years and carries profit at the rate of 3-months KIBOR plus 300 bps, payable on quarterly basis. They are to be repaid in forty equal quarterly installments that commenced from March, 11. Total Equity injected and the financing facility availed at COD were as follows: Description Equity At COD (PKR in million) Ordinary number of shares 504,584,055 Equity value at par value of PKR. 10/ share 5,046 Debt* 15,137 Total cost of the Project 20,183 * This amount does not include unavailed facility of PKR 113 million at the time of COD. Page 59 of 128

62 The current structure of debt profile is presented in the following table: Description Long term financing As at March 31 st, 201 (PKR in million) Senior Islamic Facility (Sukuk - Ijarah tul musharaka) 7,503 Long term finance facility 935 Total long term debt outstanding (Inclusive of current portion) 8,438 Short term Borrowing Short term running finance 7,304 Available short term facilities 1 Short term running Musharakah 10,595 Short term running finance facility 3,250 1 Available short term facilities (running Musharakah and running finance facility) amounts to PKR 13,845 million, out of which PKR 7,304 million is utilized by the Company 4.5 LIBERTY GROUP OVERVIEW The principal sponsor of the Company is Liberty Group, which holds majority shareholding (90%) through Liberty Mills Limited ( LML ) and the Mukaty family. LPTL Shareholding Sep 2016 Liberty Mills Limited 29% Mukaty family 61% Soorty Enterprises 10% Liberty Group has investments in Textile, Power Generation, Capital Market, FMCG and Real Estate related businesses. Names of major Group Companies are below along with their purpose: Liberty Mills Limited (Textile Manufacturer and Exporter), Liberty Power Tech Limited (Independent Power Producer (IPP) of 200 Megawatts of Electricity using Residual Fuel Oil), The Group also has investments in various companies, details of which are given below: Liberty Thar Power (Pvt) Limited The Company was incorporated for the development of power plant through indigenous Thar coal. The Company has got a provisional coal allocation letter from Sindh Engro Coal Mining Company for setting up 330MW mine mouth power project. The allocation is for the year Zulaikha Energy (Pvt) Limited The Company was incorporated for the development of 50 MW Wind Power Plant. Energy Department, Government of Sindh has already issued Letter of intent and Land Utilization Department has also Page 60 of 128

63 allocated respective land for the development. Furthermore, NEPRA has granted generation license to the said project. Noor Solar Energy (Pvt) Limited The Company was incorporated for the development of 50 MW Wind Power Plant. Energy Department, Government of Sindh has already issued Letter of intent and Land Utilization Department has also allocated respective land for the development. Furthermore, the Company has applied for Generation License with NEPRA which is in process. WND Energy Limited The Company was incorporated for the development of 50 MW Wind Power Plant. The Company has submitted a proposal with Alternative Energy Development Board along with the prerequisite processing fee and Bank Guarantee. Issuance of letter of intent is in process. Emerald Energy Limited The Company was incorporated for the development of Solar Power Plant. The Company has submitted a proposal with Punjab Power Development Board for issuance of Letter of intent. Liberty Solar Energy Limited The Company was incorporated for the development of Solar Power Plant. The company has submitted the proposal with Alternative Energy Development Board for issuance of Letter of intent. The company has also acquired certain land in Faisalabad for the said project. ZTA (Private) Limited The Company was incorporated for real estate business. Currently, it is not in operation. Liberty Holding (Private) Limited The Company was incorporated to act as holding company. Currently, it is not in operation. LML Corporation Limited The Company was incorporated to act as holding company. Currently, it is not in operation Pakistan Aluminum Beverage Cans Limited (PABC) Mukaty family holds 49% shareholding in PABC. It is the first of its kind Aluminum Can producing company of Pakistan. Its sponsors are Ashmore Group UK (Investment Management Firm) and Liberty Group. PABC potential major customers are COKE & PEPSI. PABC commenced its operation during May Liberty Steel (Private) Limited Liberty Steel is a recently incorporated entity by the Group. The principal line of business is to manufacture and market steel products. Liberty Group ( the Group ) is a well-known business group and a growing conglomerate of the Country since more than five decades. The Group has over half a century experience of running large scale manufacturing industries. The Group mainly consists of two operative companies namely Liberty Mills Limited and Liberty Power Tech Limited. Liberty Mills is one of largest textile manufacturer and exporters of the Country which remains in the business for last five decades. The installed state of the art processing plant made LML distinguished among the other textile manufacturers. The Company has been contributing towards the national exchequer through its substantial export proceeds in foreign exchange. The Group has also diversified in Power Sector and incorporated Liberty Power Tech in 2007 to build, own and operate 200 MW RFO based Power Complex as an IPP. The Company had successfully achieved its entire milestones including Financial Close, EPC, O&M and finally COD in Jan-2011 almost within the timeline provided by the respective relevant authorities which made it distinguished among the other IPPs. The Company has been supplying uninterrupted electricity upto the extent of its achievable capacity to national grid since In order to further contribute in the national energy sector, the Group has been pursuing 2x50 MW Wind Power Plant at Jhimpir Sindh. Furthermore, the Group owns 5.40% shareholding in Engro Power Gen Thar (Private) Limited for developing 660 MW first mine mouth coal fired power plant. Page 61 of 128

64 The Group also maintains sizable portfolio of shares in different listed companies and funds. Apart from that, it has also 49% shareholding in first ever upcoming (commercial production expected by June 2017) beverage can manufacturing plant in the country namely Pakistan Aluminum Beverage Can Limited (PABC). Liberty Group is the joint partner of Ashmore Group UK in PABC. Ashmore Group has 51% shareholding in PABC. The Group employs over 3,000 employees / workforce 4.6 ASSOCIATES OF THE COMPANY The Company has 20% shareholding (4,020 ordinary shares of Rs. 10/-each) in Liberty Thar Power (Private) Limited (LTPL). The acquisition of shares was made on December 3, The paid up capital if LTPL is PKR 201,000 consisting of 20,100 unquoted shares. The principle business of LTPL is to construct, finance, own and operate coal fired power generation facility. Subsequent to the date of acquisition, no significant transaction has taken place in LTPL, hence no share of profit or loss has been accounted for. Liberty Thar (Pvt) Ltd has got a provisional coal allocation letter from Sindh Engro Coal Mining Company for setting up 330MW mine mouth power project. The allocation is for the year As and when the project will materialize, the Company will move forward subject to all regulatory approvals and shall make further investments in the project assets. 4.7 POWER SECTOR OVERVIEW The power sector is presently undergoing a major transformation where the Federal and Provincial Governments have aligned their priorities for overcoming the energy crises which have been adversely affecting the social, economic and financial progress of the country for the past many years. Pakistan finds itself in shortfall in terms of power supply, with supply unable to keep pace with demand. The spike in shortfall is primarily due to the following reason: 1. Capacity is underutilized from existing power plants 2. Transmission and Distribution losses 3. Creation of circular debt In Pakistan, power distribution and transmission is dominated by National Transmission and Dispatch Company Limited ( NTDCL ); whereas in Karachi power generation, distribution, and transmission, is controlled by K-Electric (formally Karachi Electric Supply Corporation). Power Sector saw major developments during recent times as the present Government has given high priority to this sector. The present Government retired the circular debt in start of its administration period. The Government has also brought down power subsidies and has tried to contain the accumulation of new payable arrears in the power sector. The subsidy for power sector which were PKR 464 billion (2.3% of GDP) in FY 2012 has been consistently reduced to PKR 217 billion (0.7% of GDP) in FY Page 62 of 128

65 Demand and Supply (MW) 25,000 20,000 15,000 10,000 5, Generation capability Demand during peak time Deficit 7,000 6,000 5,000 4,000 3,000 2,000 1,000 - Source: Nepra State of the Industry Report Pakistan Economic Survey Major Sources of Electricity Generation - '000 Gwh Total generation Hydroelectric Thermal Nuclear Source: Pakistan Economic Survey Contribution from major sources of electricity generation during 2017 and 2016 are depicted in the below charts: Page 63 of 128

66 6% 4% 30% 34% % 62% Thermal Hydroelectric Nuclear Thermal Hydroelectric Nuclear Source: Pakistan Economic Survey Transmission Lines and Grid Stations with NTDC The integrated transmission system of NTDC comprises of 500 kv and 220 kv transmission lines and grid stations. The status of transmission lines and grid stations, at the end of fiscal years from 2011 to 2015, owned and operated by NTDC is mentioned in following table: Transmission Lines As on 30 th June 500 kv 220 kv Total Transmission Lines and No. of Circuits No. of Total Km. Circuits No. of No. of Total Km. Circuits Circuits Total Km , , , , , , , , , , , , , , ,011 Grid Stations As on 30 th June 500 / 220 kv 220 / 132 kv Total No. of Grid Stations and MVA Capacity Total No. of Total MVA Grid Station Capacity No. of Grid Station MVA Capacity No. of Grid Station MVA Capacity , , , , , , , , , , , , , , ,687 Source: NTDC Nepra State of the Industry Report 2015 Page 64 of 128

67 As per the NTDC website, it maintains thirteen 500 kv and thirty seven 220 kv grid stations as of It also has 5,077 km of 500 kv transmission line and 7,359 km of 220 kv transmission line. Region wise grid stations distribution are as follows: Region wise Grid Stations as of 2016 Name of Region 500kV 220 kv Total Islamabad Lahore Multan Hyderabad Total Source: NTDC Website T&D Losses and Recoveries Recoveries (%) 96% 94% 92% 90% 88% 86% 84% 82% 94.40% 93% 90% 88% 89% 89% 87% Source: Ministry of Water and Power Economic Survey / % 19.0% 18.0% Transmission & Distribution Losses (%) 19.7% 19.4% 19.1% 19.1% 18.6% 18.0% 17.0% 16.0% 16.30% Source: Ministry of Water and Power Economic Survey / 17 Page 65 of 128

68 4.8 DEMAND OUTLOOK Pakistan s economy has witnessed a growth momentum for the last 3 years with real GDP growing at a rate of 4.71% in FY16. Industrial and services sector crossed their target growth while other key macroeconomics indicators like inflation, fiscal and current account balance recorded improvement 1. The industrial sector during FY16 recorded a growth of 6.8% against the target of 6.4% and is all time high in eight years. This was also supported by the continuous improvement in electricity and gas supplies which also recorded growth of 12.18% during the same period 1. The said growth will gain further momentum on the back of increasing public sector development spending coupled with infrastructure and power sector development program under CPEC. Robust activity will trigger higher demand for electricity generation which is currently lower as compare to regional countries. Following is a graph depicting electricity consumption per capita: Electricity Consumption per Capita (kwh) 4,000 3,762 14% 3,500 3,000 2,500 2,000 1,500 1, ,104 2, % 10% 8% 6% 4% 2% - 0% 2013 CAGR 10 years Source: World Bank 1 Pakistan Economic Survey As depicted by the above graph, Pakistan is still lagging behind as compare to regional countries with a CAGR of around 1% during the last 10 years. However, Pakistan s rapid transformation of industrial sector will act as a catalyst to increase electricity consumption per capita. 4.9 RISK FACTORS Most IPPs are structured in a way that they are protected from many risks emanating from demand, currency devaluation, force majeure and fuel supply since the costs incurred are pass through costs. Moreover, the obligations of the power purchaser are guaranteed by the GoP. The stable revenue stream is ensured through the minimum guaranteed capacity charge (component of the tariff that any IPP receives even if it produces no electricity in case of zero demand from the power purchaser). However some of the specific risks that LPTL could possibly face are stated below: Page 66 of 128

69 4.9.1 Change in Regulatory Regime During the last two decades a number of IPPs have entered into the Pakistan s power sector due to GOP s inclination towards rectifying the power shortages in the Country. However, due to CPEC related activities even more power generation facilities will make their way into the system. Change in power policies, tariff regime by the Government or other Regulation by Government may adversely affect the operation and profitability of the Company Fuel Supply Risk The Company had entered into a Fuel Supply Agreement dated 18th December 2008 with Shell Pakistan Limited under which Shell Pakistan Limited is obliged to supply the fuel requirements of the Company. However since the last several years, the Company has been making its purchases of fuel from various oil marketing companies from time to time as per the Company s requirement and keeping in view the service and quality standards of the fuel supplier. The Company s fuel supply arrangements with various oil marketing companies ensures timely supply of quality fuel for the smooth operations of the power generation complex of the Company Circular Debt Risks Cash flow constraints add to the operational inefficiencies of companies in the power sector. Therefore, nonpayment by the NTDC may affect the liquidity of the Company in due course. As of December 31 st 2016, an amount of PKR 6.9 billion has been held by the NTDC. The amount is overdue but not impaired because the payment of receivables is guaranteed by the Government of Pakistan (GoP) through a sovereign guarantee under the Implementation Agreement Technology and Obsolescence Risk There may be a risk that the technology used and the machinery and equipment installed may get old resulting in more maintenance costs or frequent breakdowns, etc Competition Risk There is a risk that due to competition with other power producers and availability of cheaper source of electricity generation may adversely affect the revenues of the Company Legal Risk There is a risk that unanticipated changes in regulations could have an adverse impact on the Company. However, such regulatory changes could reasonably be expected to affect all players within the sector and would therefore not affect the Company s position or business in isolation Working Capital Management Risk The availability of adequate working capital during the operational stage of the project is essential. The IPP might be required to inject liquidity in case the payments from the NTDC are delayed and payments to fuel supplier fall due Under Subscription Risk The offer of shares of Liberty Power Tech Limited may get under-subscribed due to lack of interest on part of the investors. In such a case, the book building process shall be considered as cancelled if the Company does not receive Page 67 of 128

70 bids for the number of shares allocated under the Book Building Portion and the bid money submitted by investors shall be refunded accordingly. Note: IT IS STATED THAT ALL MATERIAL RISK FACTORS HAVE BEEN DISCLOSED AND THAT NOTHING HAS BEEN INTENTIONALLY CONCEALED IN THIS RESPECT Page 68 of 128

71 5 FINANCIAL INFORMATION 5.1 SHARI AH COMPLIANCE CERTIFICATE Page 69 of 128

72 5.2 AUDITORS REPORT UNDER CLAUSE 1 OF SECTION 2 OF THE FIRST SCHEDULE TO THE PUBLIC OFFERING REGULATIONS, 2017 FOR THE PURPOSE OF INCLUSION IN THE OFSD OF LIBERTY POWER TECH LIMITED Page 70 of 128

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77 5.3 AUDITOR CERTIFICATE ON ISSUED, SUBSCRIBED, AND PAID-UP-CAPITAL OF THE COMPANY Page 75 of 128

78 5.4 SHARE BREAK-UP VALUE CERTIFICATE Page 76 of 128

79 5.5 SUMMARY FINANCIAL HIGHLIGHTS OF LIBERTY POWER TECH LIMITED (Amounts in PKR millions) As at and for the year ended June 30 th Nine Months ended March Income Statement Revenue 11,535 21,846 27,326 28,698 24,390 14,773 12,014 Cost of Goods Sold (8,960) (16,362) (21,634) (23,349) (18,808) (9,990) (8,651) Gross Profit 2,574 5,484 5,693 5,349 5,583 4,783 3,363 Operating Profit 2,512 5,436 5,627 5,269 5,542 4,664 3,698 Depreciation and Amortization 418 1,502 1,438 1,516 1,373 1, EBITDA 2 2,930 6,938 7,065 6,786 6,915 5,944 4,649 Financial Charges (1,514) (3,279) (2,495) (2,061) (1,852) (1,157) (720) Profit before Taxation 998 2,157 2,961 3,208 3,691 3,508 2,978 Profit after Taxation 997 2,157 2,961 3,204 3,680 3,490 2,911 Balance Sheet Non-Current Assets 19,247 17,911 16,612 15,541 14,254 13,442 12,898 Current Assets 8,941 13,826 15,301 14,724 14,018 12,582 13,915 Total Assets 28,189 31,737 31,913 30,265 28,272 26,024 26,813 Equity 5,989 8,146 9,871 11,310 13,300 14,901 9,534 Unrealized (loss) / gain on remeasurement of investments (47) - AFS Long-Term Debt 14,725 14,055 13,263 12,331 11,237 9,593 8,438 Short-Term Borrowings 5,108 6,893 5,512 4,345 2, ,304 Non-Current Liabilities 14,050 13,255 12,324 11,229 9,963 8,439 7,136 Current Liabilities 8,149 10,335 9,718 7,726 5,009 2,684 10,144 Net Debt 3 24,939 27,841 17,968 20,602 16,527 11,337 21,722 Stock-in-trade ,100 Trade debts 7,585 12,395 7,443 11,912 10,171 8,593 10,942 Trade and other payables 1,543 1,890 2,698 1, ,275 Cash Flow Statement Operating Activities (5,827) (951) 9,868 (1,590) 5,649 6, Investing Activities (2,820) (165) (139) (445) (1,567) (1,062) 2,143 Financing Activities 3,292 (669) (2,029) (2,697) (2,800) (3,433) (9,500) Net increase / (decrease) in cash and cash equivalents (5,355) (1,786) 7,700 (4,732) 1,281 1,772 (6,431) Cash and cash equivalents at the beginning of the year 248 (5,107) (6,893) 807 (3,925) (2,644) (871) Net Cash Balance (5,107) (6,893) 807 (3,925) (2,644) (871) (7,303) Fixed Capital Expenditure (2,820) (168) (139) (450) (74) (462) (418) Growth Sales Growth (%) 89% 25% 5% -15% -39% 3% EBITDA Growth (%) 137% 2% -4% 2% -14% 3% Profit after Taxation Growth (%) 116% 37% 8% 15% -5% 10% Page 77 of 128

80 March Margins Gross Profit Margin (%) 22% 25% 21% 19% 23% 32% 28% EBITDA Margin (%) 25% 32% 26% 24% 28% 40% 39% Profit after Taxation Margin (%) 9% 10% 11% 11% 15% 24% 24% Earnings Ratios Earnings per Share - Basic & diluted Break-up Value per Share - Basic (inc. Gain/ (Loss) on AFS) Break-up Value per Share - Basic (exc. Gain/ (Loss) on AFS) Return on Equity (%) 17% 26% 30% 28% 28% 23% 31% Return on Assets (%) 4% 7% 9% 11% 13% 13% 11% Balance Sheet Ratios Fixed Asset Turnover (x) 0.6x 1.2x 1.6x 1.8x 1.7x 1.1x 0.9x Asset Turnover (x) 0.4x 0.7x 0.9x 0.9x 0.9x 0.6x 0.4x Capex to Total Assets (%) 10% 1% 0% 1% 0% 2% 2% Current Ratio (x) 1.1x 1.3x 1.6x 1.9x 2.8x 4.7x 1.4x Inventory Turnover (days) N/A Receivables Turnover (days) N/A Payables Turnover (days) N/A Leverage Ratios Long-Term Debt to EBITDA (x) 5.0x 2.0x 1.9x 1.8x 1.6x 1.6x 1.8x Net Debt to EBITDA (x) 8.5x 4.0x 2.5x 3.0x 2.4x 1.9x 5.0x Long-Term Debt to Equity (x) 2.5x 1.7x 1.3x 1.1x 0.8x 0.6x 0.9x Long-Term Debt to Total Assets (x) 0.5x 0.4x 0.4x 0.4x 0.4x 0.4x 0.3x EBITDA/Interest (x) 1.9x 2.1x 2.8x 3.3x 3.7x 5.1x 6.5x (EBITDA - Capex) 110 6,770 6,926 6,336 6,841 5,482 4,231 (EBITDA - Capex)/Interest (x) 0.1x 2.1x 2.8x 3.1x 3.7x 4.7x 5.9x Number of Shares Outstanding ( 000) 504, , , , , , ,584 1 Figures are based on Nine months period accounts ending March 31, Growth is calculated based on annual increase comparing to March 31, 2016 figures 2 EBITDA is calculated by adding depreciation and amortization to operating profits 3 Net debt is calculated by taking long term liability, current portion of long term liability, short term borrowing and deducting cash & cash equivalent at the year end 4 Breakup value is calculated by dividing total equity with no. of outstanding shares Page 78 of 128

81 5.6 FINANCIAL ANALYSIS OF PEER GROUP LISTED COMPANIES 1 Company Name Last year Avg. Price 2 Market Cap (mn) 3 LTM EPS 4 BVPS 5 LTM P/E 6 P/B 7 Hub Power Company Ltd , x 5.2x Kot Addu Power Co , x 2.3x Nishat Chunian Power Ltd , x 2.0x Nishat Power Ltd , x 1.3x Lalpir Power Ltd , x 0.6x Engro Powergen Ltd , x 1.3x Saif Power Ltd , x 1.3x Average 7.4x 2.0x Median 6.9x 1.3x 1 All financial information is sourced from audited / unaudited financial accounts of the respective companies 2 Price calculated as average of closing prices from January 1 st, 2016 to December 30 th, 2016 as listed on Pakistan Stock Exchange 3 Market Capitalization is based on share price as at 18 th May, Trailing Last twelve months earnings from March, Book value per share is calculated as at March, Last twelve month P/E is calculated as the day end closing price of May 18th, 2017 divided by Trailing EPS from March, Price / Book is calculated as the day end closing price of May 18th, 2017 divided by book value as of March 2017 Company Name Dividend per share 1 Dividend Payout 2 Dividend Yield 3 Hub Power Company Ltd % 6% Kot Addu Power Co % 12% Nishat Chunian Power Ltd % 7% Nishat Power Ltd % 7% Lalpir Power Ltd % 10% Engro Powergen Ltd % 9% Saif Power Ltd % 12% 1 Dividend per share is for the last four quarters as given on PSX Website 2 Dividend payout is calculated by taking dividend per share for the last four quarters as a percentage of trailing EPS from March Dividend yield is calculated by taking dividend per share for the last four quarters as a percentage of share price as of May, 18 th, 2017 Page 79 of 128

82 Company Name Gross Capacity (MW) 1 Power Policy 2 Hub Power Company Ltd 1,292 Prior to 1994 Kot Addu Power Co. 1,600 Prior to 1994 Nishat Chunian Power Ltd 202 Under 2002 Nishat Power Ltd 202 Under 2002 Lalpir Power Ltd 362 Under 1994 Engro Powergen Ltd 226 Under 2002 Saif Power Ltd 225 Under Gross Capacity as per Nepra website 2 Power Policy as per Nepra website ROE 1 45% 40% 35% 30% 25% 20% 15% 10% 5% 0% 39% 32% 31% 24% 26% 19% 8% HUBC KAPCO NCPL NPL LPL EPQL SPWL 1 ROE is calculated by taking trailing EPS from March 2017 and dividing by book value as of March 2017 Page 80 of 128

83 6 MANAGEMENT 6.1 BOARD OF DIRECTORS OF THE COMPANY S. No. 1 Name Address Designation Mr. Muhammad Salim N. Mukaty Plot No.26 Khayabane-Muhafiz Phase VI, DHA, Karachi Chairman Partnership/Directorships in Other Companies Liberty Mills Limited Liberty Holding (Private) Limited Emerald Energy Limited WND Energy Limited Liberty Solar Energy Limited Zulaikha Energy (Private) Limited Noor Solar Energy (Private) Limited Liberty Thar Power (Private) Limited ZTA (Private) Limited 2 Mr. Muhammad Ashraf Plot No.25 Khayabane-Muhafiz Phase VI, DHA, Karachi Non Executive Director Liberty Mills Limited Liberty Holding (Private) Limited Liberty Steel (Private) Limited 3 Mr. Azam Sakrani House No. F-22/1, Block-8, Clifton, Karachi CEO Emerald Energy Limited WND Energy Limited Liberty Solar Energy Limited Zulaikha Energy (Private) Limited Noor Solar Energy (Private) Limited 4 Mr. Yousuf Mukaty 5 Mrs. Hamida Salim Mukaty Plot No.26 Khayabane-Muhafiz Phase VI, DHA, Karachi Non Executive Director Non Executive Director Liberty Mills Limited Liberty Holding (Private) Limited Emerald Energy Limited WND Energy Limited Liberty Solar Energy Limited Zulaikha Energy (Private) Limited Noor Solar Energy (Private) Limited Liberty Thar Power (Private) Limited ZTA (Private) Limited 6 Mrs. Marzia Obaid Bawany Plot No.26 Khayabane-Muhafiz Phase VI, DHA, Karachi Non Executive Director Liberty Holding (Private) Limited 7 Mrs. Farheen Ashraf Plot No.25 Khayabane-Muhafiz Phase VI, DHA, Karachi Non Executive Director Liberty Holding (Private) Limited Liberty Thar Power (Private) Limited Liberty Steel (Private) Limited 8 Mrs. Nargis Shahid Soorty Plot No.26 Khayabane-Muhafiz Phase VI, DHA, Karachi Non Executive Director Liberty Holding (Private) Limited Soorty Enterprises (Pvt) Limited Page 81 of 128

84 6.2 UNDERTAKING BY THE COMPANY AND ITS SPONSORS The Company and its sponsors undertake: 1. That none of the Directors, Sponsors or Substantial Shareholders have been holding the office of the directors, or have been sponsors or substantial shareholders in any company: (i) which had been declared defaulter by the securities exchange or futures exchange; or (ii) whose TRE Certificate has been cancelled or forfeited by the Exchange, PMEX or any other registered stock exchange of Pakistan that existed prior to integration of stock exchanges pursuant to Integration Order number 01/2016 dated January 11, 2016 issued by the Commission due to noncompliance of any applicable rules, regulations, notices, procedures, guidelines etc. which has been de-listed by the securities exchange due to non-compliance of its regulations. (iii) was de-listed by the Exchange due to its non-compliance of any applicable provision of PSX Regulation. 2. That none of the Sponsors, Major Shareholders, Directors or Management of the Company as well as the Company itself or its Associated Company / Entity have been found guilty of being engaged in any fraudulent activity. The Company have made full disclosure regarding any / or all cases in relation to involvement of the person named above in any alleged fraudulent activity i.e., pending before any Court of Law / Regulatory Body / Investigation Agency in or outside of the Country. 6.3 OVERDUE LOANS There are no overdue loans (local or foreign currency) on the Company, its directors, its sponsors and Offerors. The Company, its CEO, its directors, its sponsors and Offerors, under the oath, undertakes that they have no overdue payment to any financial institutions 6.4 DIVIDEND PAYOUT BY THE LISTED GROUP / ASSOCIATED COMPANIES There are no group / associated companies that are listed on PSX. 6.5 PROFILES OF DIRECTORS Mr. Mohammad Salim N. Mukaty Mr. Salim N. Mukaty founded Liberty Mills Ltd in Since then Liberty has embarked upon a mission of continuous growth and success through planning and development and constant pursuit of excellence in terms of global competition. This edge has been achieved with major investment in technology, skill development and effective human resources management. The Company has a successful history of receiving various corporate and government awards. In order to meet the growing power shortages in the country, a company was established in the name of Liberty Power Tech Limited which is an Independent power project set up in the province of Punjab which commenced Commercial Operation in Jan At the time this project was the single largest Shari ah Compliant project in the country. Mr. Salim Mukaty is also actively engage in Philanthropic work. His contributions are as follows: Page 82 of 128

85 1. Established Zulekha Bai Community Centre, in Hyderabad, for educational and social purposes of the community and it is the single community center for Memon community in Hyderabad. 2. Established TCF School in Itihad Town, Karachi where over 800 students are receiving education. Mr. Salim Mukaty is a regular donor to various organizations including Kidney Centre, Jetpur Memon Association and Memon Charitable Hospital, Karachi Mr. Muhammad Ashraf Mr. Ashraf joined the family business in 1982 and he has attended several training courses in Europe. He is fully engaged in looking after the production, quality control and finishing departments of the Company. Since the last decade he is also handling the entire operations of the Company. Under his leadership Liberty Mills Limited has experienced tremendous expansion and growth and major investments in technology, skill development and effective human resource management which resulted in achievements of various international accreditations including: 1. ISO 9001 / OEKO TEX STANDARD LYCRA Accredited Mills Network 4. Performance Testing Laboratory Accredited by Target 5. Certificate of Excellence by Actigard 6. Certificate of compliance with a gold award was awarded by London Fog Group 7. Compliance version 505 for the criteria of human right compliance, health and safety compliance and environment compliance. Mr. Ashraf has been awarded export trophy for the Best Exporter of made-ups in the year 2006 by the Prime Minister of Pakistan. Mr. Ashraf also played an active role in setting up the first Aluminum Can Plant in Pakistan along with Joint Venture Partner Ashmore (UK). The manufacturing facility is based in Faisalabad and has capabilities to produce up to 700 Million cans per annum which can cater to the demand of both the local and Afghanistan market. Diversification in Power Sector through Liberty Power Tech Limited was mainly initiated by him. Mr. Mukaty was actively involved in attaining approvals from the government agencies and negotiation with the banks and EPC contractors. Under his management, the Company has been supplying uninterrupted electricity to the NTDC Mr. Yousuf Mukaty Mr. Yousuf Mukaty is also Director of Liberty Mills Limited. He was a founding member and led the production and R&D divisions bringing Liberty to the forefront of innovation. He attended numerous international conferences throughout his career with his primary focus on sustainability, energy conservation and resource management. He has been associated with Liberty Group for the last 50 years and has been a key member of the investment team. He has always emphasized innovation and been an inspirational leader Mrs. Hamida Salim Mukaty She is a house wife and engaged in philanthropic work. Page 83 of 128

86 6.5.5 Mrs. Marzia Obaid Bawany Mrs. Marzia Obaid Bawany studied Economics and Finance at the London School of Economics (LSE). After which she remained in London to pursue her career. Subsequently she shifted to Dubai Mrs. Farheen Ashraf House wife and an active member of the Patients Aid Foundation and Jinnah Foundation where she devotes her spare time. Furthermore she is independently in the business of import of household accessories working with top brands from USA and Europe Mrs. Nargis Shahid Soorty Mrs. Nargis Shahid Soorty is a director at Soorty Enterprises, one of the Country s largest garment exporters. Her marketing experience and technical understanding of denim has helped Soorty Enterprises achieve exponential growth under her management. Mrs. Nargis Soorty has attended numerous management courses at Harvard Business School and has been certified by the Pakistan Institute of Corporate Governance (PICG). In addition to this, she is also actively engaged in Philanthropic work. 6.6 PROFILES OF OTHER KEY MANAGEMENT Mr. Azam Sakrani CEO Mr. Sakrani has been the Chief Executive Officer of Liberty Power Tech Limited since October Mr. Sakrani has over 20 years of experience particularly in project financing, business development, strategic management with different leading banks and industrial conglomerate of the country. He also possesses sound experience in the development of an ethanol production plant from the beginning to successful commissioning by way of project feasibility, development, construction monitoring with a well-known industrial undertaking of the country. Mr. Sakrani has done his B. Sc. In Finance and holds MBA degree from renowned universities of USA. He was a former SVP of Habib Bank AG Zurich and CEO of Al- Noor Modaraba Mr. Adamjee Yakoob CFO Adamjee Yakoob is a Chartered Accountant (FCA) from England & Wales and Pakistan, Chartered Certified Accountant (FCCA-UK), Certified Internal Auditor (CIA-USA) and a Master in Commerce. He is a position holder of the University of Karachi Bachelor of Commerce examinations and ACCA. He also holds Bsc Hons (UK) degree in Applied Accounting and has a certification in Capital Markets & Islamic finance. He is currently working as the Group CFO of Liberty Group and is a Director of Pakistan Aluminum Beverages Can Limited. Previously, he was the CFO of Citibank, N.A. Pakistan. His industry, audit and consulting experience of more than 16 years is spread over a wide spectrum of finance covering foreign, government, local and multinational organizations including Standard Chartered Bank and A.F.Ferguson & Co., Chartered Accountants (PricewaterhouseCoopers). He has been engaged with clients like Abbott Laboratories, Syngenta, Pheonix Armour, PNSC, NI(U)T, HBL, MCB and others. He is an experienced CFO with proven record of establishing cross-functional partnerships to deliver stellar results. Accounting and tax mastery, financial planning and budget preparation, information technology acquaintance and fluency, strong presentation & communication skills, corporate secretarial work, efficient Regulator & Government dealings, public relationships (including dealing with BoD / CEO/ Peers), are some of his traits which have made him part of the Management teams of large organizations. Dealing with Federal Board of Revenue Chairman and Board Page 84 of 128

87 members (on taxation matters), financial institutions and investment firms, both local and international (multilateral), has been part of his experience. He regularly delivers public courses (both local and foreign) in the areas of finance, valuation modeling, management / cost accounting and audit. He has also attended foreign trainings in UK, South Africa, USA and Dubai on leadership, risk management, finance and Sarbanes Oxley. He has previously been active member of various trade associations and bodies including OICCI, American Business Council, Pakistan Banking Association and various committees of Institute of Chartered Accountants of Pakistan Mr. Tanveer Ahmed Resident Director Mr. Tanveer Ahmed is the Project Director of Liberty Power Tech Limited since the beginning of the said project. Previously, he remained associated with Liberty Group since 1990 as Director Maintenance. His specialties are engineering and operations of power generation facilities. Mr. Tanveer also performed key role in the construction phase of 200 MW RFO based Power Project. He has obtained extensive exposure for the development and construction of power plant particularly with the technical requirement of WAPDA / NTDC. He has maintained good relationship with different government agencies like NEPRA, CPPA, NTDC, WAPDA, FESCO etc. Mr. Tanveer has done his BE Electrical from NED and hold MS degree in Power Control System Mr. Saleem Suleman Head of Internal Audit Mr. Saleem Suleman has been the Head of Internal Audit of Liberty Power tech Limited since 2008 and has been associated with Liberty Group since He is a Graduate and has an experience of varied roles within finance, accounting, import and tax in Liberty Mills and Gul Ahmad Textile Mills Mr. Kashif Hanif Head of Finance and Company Secretary Mr. Kashif Hanif has been working as Head of Finance & Company Secretary. He has over 10 years experience related to finance and accounts. He is a qualified management accountant and is also an associate member of Institute of Cost & Management Accountants of Pakistan. He has been with Liberty Power Tech Limited since April He is mainly responsible for corporate reporting, management reporting, taxation, secretarial compliances and regulatory reporting applicable to IPPs. He has worked and developed financial models and financial projections for different projects of the group. Apart from that, he is Chief Financial Officer and key member of project development team for upcoming Wind Power Projects of the Liberty Group. Before joining the Liberty, Mr. Kashif has worked for a listed textile Company as Head of Finance & Company Secretary Mr. Zahid Iqbal Manager Mechanical Mr. Zahid Iqbal is working as plant manager with Liberty Power Tech Limited. Joined LPTL in October 2009 during project construction phase and contributed for safe and timely completion of the Project. Later on, after COD he coordinated in O&M related activities, contract negotiations, Warranty handling, Spare parts ordering and with different government agencies for commercial invoicing and approvals of licenses and technical queries. Page 85 of 128

88 Previously, he has worked with Wärtsilä Pakistan as Superintendent Engineer in Field Service Department for 5 years ( ) and before that he was working on International Merchant vessels as Marine Engineer from 1997 till He has vast experience of working on Marine vessels and Power Plants including operation and maintenance with variety of machinery. During his service in Wärtsilä, he executed several projects, especially served key roles in the DF conversion projects of Wärtsilä Engines at Century Paper Mills, Crescent Textile and Lucky Cement. He has done B.Sc. (Marine Engineering) with certificate of Competency from Singapore and UK Lt Col (Retd.) Parwez Ahsen Choudhri Mr. Parwez Ahsen is working as Manager Admin, Security & Safety with Liberty Power Tech Limited, joined LPTL in January Main responsibilities include safety, security and administration of the Site / Power Plant and coordination with local Police and government security agencies. Previously, he has worked in G4S Wackenhut Pakistan as a Senior Branch Manager ( ) based in Faisalabad region, looking after company s business of cash and carry, installation of CCTV with various banks and RCS (Research and collection Service). Before that he was serving in Pak Army as commissioned officer and promoted to the rank of Lt. Col., specialized in electronic surveillance, interception and monitoring (1969 till 1990) and served as head of the department in JSIB (Joint Services Inelegance Bureau). He has vast experience of administration, safety and security in above positions and have in-depth knowledge of the security situation of the surroundings of Faisalabad region. He has done B.Sc. from PMA, Kakul with Advance Radio and Telecom degree from Army College of Signals. 6.7 NUMBER OF DIRECTORS Pursuant to Section 154 of the Companies Act, 2017 a listed Company shall not have less than seven (7) directors. At present, the Board consists of 8 directors, including the Chief Executive Officer. 6.8 QUALIFICATION OF DIRECTORS The qualification of a Director, shall be the holding of shares in the Company for the nominal value of PKR 10 at least in his own name but a director representing an interest holding shares of the nominal value of PKR 10 or more shall require no share qualification, subject to the compliance with the provisions of the Companies Act. No person shall be appointed as a Director of the Company who is ineligible to be appointed as Director on any one or more of the grounds enumerated in Section 153 of the Companies Act or any other law for the time being in force. 6.9 REMUNERATION OF THE DIRECTORS Pursuant to the Article 86 of the articles of association of the Company, unless otherwise determined by the Company in General Meeting each director shall be paid out of funds of the Company by the way of remuneration for his services a sum as fixed by the Board from time to time for each meeting of the Directors attended by him. The Directors may allow and pay to any Director who for the time being is resident out of the place at which any Page 86 of 128

89 meeting of the Directors may be held and who shall come to that place for the purpose of attending the meeting, such sum as the Directors may consider fair and reasonable for his expenses in connection with his attending the meeting in addition to his remuneration as above specified Pursuant to the Article 87 of the article of association of the Company, any Director appointed to any executive office or to serve in any committee or to devote special attention to the business of the Company or who otherwise performs extra services, which in the opinion of the Directors are outside the scope of the ordinary duties of the Directors, may be paid such extra remuneration by way of salary, fees, percentage of profits or otherwise as shall from time to time be determined by the Company in a General Meeting BENEFITS TO PROMOTERS AND OFFICERS No benefit, except for the loan mentioned below, has been given or is intended to be given by the Company to the promoters and officers of the Company other than remuneration for services rendered by them as full time executives of the Company. As of December 31 st, 2016 a house loan was given to the Chief Executive. The loan is repayable in 72 equal monthly installments starting from October 30, The Securities and Exchange Commission of Pakistan (SECP) granted an approval of the said loan in terms of Section 195 of the Companies Ordinance, 1984 through its letter no. CLD/CCD/Co. 195/03/2014 dated July 16, The table below provides detail of the above mentioned loan: Outstanding amount ( 000) Repaid during the period Mark up Chief Executive Officer 11,250 1,875 Mark up free 6.11 INTEREST OF DIRECTORS All directors of LPTL may be deemed to be interested to the extent of their shareholding in the Company and fees payable to them (if any), for attending meetings of the Board or a committee thereof as well as to the extent of other remuneration and reimbursement of expenses payable to them, if any under the articles of association, and to the extent of remuneration paid to them, if any for services rendered as an officer or employee of the Company. The directors of LPTL may also be regarded as interested to the extent of their shareholding in companies that are shareholders of LPTL. All directors may also be deemed to be interested to the extent of any dividend payable to them and other distributions in respect of their shareholdings noted above. Following directors are holding the Ordinary Shares of the Company: Name of Shareholder Designation Numbers of Shares held Value of Shares held Mr. Muhammad Salim N. Mukaty Chairman 84,373, ,738,330 Mr. Muhammad Ashraf Non-Executive Director 114,415,000 1,144,150,000 Mrs. Farheen Ashraf Non-Executive Director 45,192, ,921,220 Mrs. Marzia Obaid Bawany Non-Executive Director 24,945, ,450,000 Mrs. Nargis Shahid Soorty Non-Executive Director 24,874, ,748,000 Mrs. Hamida Salim Mukaty Non-Executive Director 15,433, ,330,000 Mr. Yousuf Mukaty Non-Executive Director 100 1,000 Mr. Azam Sakrani CEO 100 1,000 Page 87 of 128

90 6.12 INTEREST OF CHIEF EXECUTIVE OFFICER As of December 31 st, 2016 a house loan was given to the Chief Executive. The loan is repayable in 72 equal monthly installments starting from October 30, The Securities and Exchange Commission of Pakistan (SECP) granted an approval of the said loan in terms of Section 195 of the Companies Ordinance, 1984 through its letter no. CLD/CCD/Co. 195/03/2014 dated July 16, The table below provides detail of the above mentioned loan: Outstanding amount ( 000) Repaid during the period Mark up Chief Executive Officer 11,250 1,875 Mark up free 6.13 INTEREST OF DIRECTORS IN PROPERTY ACQUIRED BY THE COMPANY None of the Directors of the Company had or has any interest in any property acquired by the Company or proposed to be acquired by the Company ELECTION OF DIRECTORS The Directors of the Company are elected for a term of three years in accordance with the procedure laid down in Section 159 of the Companies Act. The Directors shall comply with the provisions of Sections 154 to 159 and Sections 161 and 167 relating to the election of Directors and matters ancillary thereto. Subject to the provisions of the Companies Act, the Company may from time to time increase or decrease the number of Directors. Any casual vacancy occurring on the Board of Directors may be filled up by the Directors, but the person so appointed shall be subject to retirement at the same time as if he / she had become a Director on the day on which the Director in whose place he / she is chosen was last elected as Director. The Company may remove a Director in accordance with the provisions of the Companies Act. The present directors were elected on October 24 th, The next election will be held within 3 years (expected in October 2017) and the Board composition will be changed to comply with the requirement of PSX Code of Corporate Governance VOTING RIGHTS In accordance with the Article 70 of the articles of association of the Company, subject to any right or restrictions for the time being attached to any class or classes of shares, on a show of hands every Member present in person or by proxy shall have one vote for election of Directors in which case the provision of Article 97 herein shall apply. On a poll every Member shall have voting rights as are laid down in the Articles. Votes may be given either personally or by proxy or, in case of a company, by a representative duly authorized as aforesaid under the Provisions of Section 138 of the Companies Act. Page 88 of 128

91 6.16 INTERNAL AUDIT The Board of Directors has set up an effective internal audit function managed by suitable qualified and experienced personnel who are conversant with the policies and procedures of the Company and are involved in the internal audit function on a full time basis. The audit committee comprises of the following members: 1. Mr. Mohammad Salim Mukaty 2. Mrs. Nargis Shahid Soorty 3. Mr. Saleem Sulaiman 6.17 HUMAN RESOURCE AND REMUNERATION COMMITTEE The Board of Directors has set up an effective Human Resources function managed by suitable and qualified personnel who are conversant with the policies & procedures of the Company and are involved in Human Resources function on a full time basis. The human resource and remuneration committee comprises of the following members: 1. Mr. Muhammad Ashraf 2. Mr. Azam Sakrani 3. Mr. Yousuf Mukaty 6.18 BORROWING POWERS OF DIRECTORS Subject to the provisions of the Companies Act and article of the Company the Directors may from time to time, at their discretion raise or borrow or secure payment of any sum or sums of money for the purposes of the Company, from any persons, firms, companies or banks and may themselves lend any such sum or sums to the Company on security or otherwise. In regard to the issue of securities the directors may exercise all or any of the powers of the Company arising under Sections 66 of the Companies Act and in particular the directors may issue any security as defined in Section 2(1) (61) of the Companies Act or may issue any instrument or certificate representing redeemable capital as defined in section 2(1) (55) of the Companies Act. Debentures, debenture stocks, bonds and other securities may been made assignable free from any equities between the Company and the person to whom the same may be issued. Any debentures, debenture-stock, bonds or other securities may be issued at a discount, premium or otherwise, and with any provisions as to redemption, surrender, drawings and conversion into ordinary shares, provided that the Company shall not issue any debenture of whatever nature carrying voting right at any meeting of the Company, except the debentures convertible into ordinary shares which may carry voting rights not in excess of the voting right attached to the ordinary shares of equal paid up value. Issue of debentures by the Company shall be subject to the provisions of Section 63 to 66, 122 and 123 of the Companies Act POWERS OF DIRECTORS The control of the Company shall be vested in the Directors and the Business of the Company shall be managed by the Directors as per the Articles of Association subject to any restrictions under the Companies Act. Page 89 of 128

92 6.20 ASSOCIATE LISTED COMPANIES There are no listed associate companies of the Company CORPORATE GOVERNANCE The Company shall comply with all the rules and regulations applicable to the Company with regards to the Code of Corporate Governance of Listed Companies. Furthermore, the Company will also ensure that at least half of the Board of Directors will have fulfilled the requirement of the director s training by June 2018 as required under the PSX regulations. The Company shall also encourage representation of minority shareholders on the board of directors. The present directors were elected on October 24th, The next election will be held within 3 years (expected in October 2017) and the Board composition will be changed to comply with the requirement of PSX Code of Corporate Governance INVESTMENT IN ASSOCIATED COMPANIES The Company has 20% shareholding (4,020 ordinary shares of Rs. 10/-each) in Liberty Thar Power (Private) Limited (LTPL). The acquisition of shares was made on December 3, The paid up capital if LTPL is PKR 201,000 consisting of 20,100 unquoted shares. The principle business of LTPL is to construct, finance, own and operate coal fired power generation facility. Subsequent to the date of acquisition, no significant transaction has taken place in LTPL, hence no share of profit or loss has been accounted for. Liberty Thar (Pvt) Ltd has got a provisional coal allocation letter from Sindh Engro Coal Mining Company for setting up 330MW mine mouth power project. The allocation is for the year As and when the project will materialize, the Company will move forward subject to all regulatory approvals and shall make further investments in the project assets REVALUATION OF FIXED ASSETS No revaluation of the fixed assets has been carried out. Company s operating property plant and equipment are stated at cost less accumulated depreciation and accumulated impairment losses, if any, except for freehold land which is stated at cost CAPITALIZATION OF RESERVES The Company has not issued any bonus shares since its inception. Page 90 of 128

93 7 MISCELLANEOUS INFORMATION 7.1 HEAD OFFICE Liberty Power Tech Limited, A/51-A, S.I.T.E., Karachi, Pakistan Phone: Website: REGISTERED OFFICE / CORPORATE OFFICE Liberty Power Tech Limited, 19 N, Model Town Extension, Lahore, Pakistan 7.3 PLANT ADDRESS OF THE COMPANY Near Sahianwala Interchange of M-3 Motorway At 5-KM Sahian-Chiniot Road District, Faisalabad, Punjab 7.4 BANKER TO THE OFFER FOR BOOK BUILDING Summit Bank Limited 7.5 BANKERS TO THE OFFER FOR GENERAL PORTION 1. Askari Bank Limited 2. Albaraka Bank Limited 3. Allied Bank Limited 4. Bank Alfalah Limited 5. Bank Alhabib Limited 6. BankIslami Pakistan Limited 7. Dubai Islamic Bank Limited 8. Faysal Bank Limited 9. Habib Bank Limited 10. Habib Metropolitan Bank Limited 11. MCB Bank Limited 12. Meezan Bank Limited 13. Soneri Bank Limited Page 91 of 128

94 14. Summit Bank Limited 15. United Bank Limited 7.6 BID COLLECTION CENTERS Karachi Contact Officer: Yasir Abbas Abdul Qadir Direct No.: Mobile No.: PABX No.: Fax No.: yasir.abbas@arifhabibltd.com abdul.qadir@arifhabibltd.com Postal Address: Arif Habib Center, 23 MT Khan Road, Karachi Naya Nazimabad, Mangophir Road, Karachi Lahore Azad Kashmir Contact Officer: Muhammad Waleed Rahmani Atif Zahoor / Zia Ullah Direct No.: Mobile No.: Fax No.: waleed.rahmani@arifhabibltd.com atif.zahoor@summitbank.com.pk ziaullah@summitbank.com.pk Postal Address: Room # 220, Arif Habib Limited, Lahore Stock Exchange, Lahore NS Tower 119 F/1, Kotli Road Mirpur Azad Kashmir Islamabad Contact Officer: Awais Ahmed Riaz Hussain Direct: PABX: Fax No: awais.ahmed@summitbank.com.pk riazhussain@summitbank.com.pk Postal Address: Plot # 109, East F-7/G-7, Jinnah Avenue, Blue Area-Islamabad Plot # 109, East F-7/G-7, Jinnah Avenue, Blue Area-Islamabad Peshawar Contact Officer: Sohail Akhtar Ihsan-Ul-Haq Direct: PABX: Fax No.: sohail.akhtar@summitbank.com.pk ihsan.haq@summitbank.com.pk Postal Address: Deans Trade Centre, Islamia Road, Saddar, Peshawar Deans Trade Centre, Islamia Road, Saddar, Peshawar Quetta Contact Officer: Syed Noman Mansoor Muhammad Ali Direct: PABX: Fax No.: nomanmansoor@summitbank.com.pk ali.muhammad@summitbank.com.pk Page 92 of 128

95 Postal Address: Ground Floor, Malik Plaza, Near Adara-e- Saqafat, M.A. Jinnah Road, Quetta Ground Floor, Malik Plaza, Near Adara-e- Saqafat, M.A. Jinnah Road, Quetta Gilgit / Baltistan Contact Officer: Shahjahan / Qurban Karim Direct: Fax No.: sjhunzai@summitbank.com.pk qurbankarim@summitbank.com.pk Postal Address: Khasra# 1103,1112 & 1113, Haji Ghullam Hussain Building Raja Bazar, Gilgit 7.7 BANKERS TO THE COMPANY 1. Allied Bank Limited 2. Habib Bank Limited 3. Meezan Bank Limited 4. Bank AL-Habib Limited 5. National Bank of Pakistan 6. Bank Alfalah Limited 7. Pak China Investment Co. Limited 8. Faysal Bank Limited 9. NIB Bank Limited 10. Summit Bank Limited 11. Habib Metropolitan Bank Limited 12. Pak Oman Investment Co. Limited 13. Pak Iran Investment Co. Limited 14. The Bank of Khyber 15. Soneri Bank Limited 16. Pak Libya Holding (Pvt) Limited 17. Askari Bank Limited 7.8 AUDITORS OF THE COMPANY Deloitte Yousuf Adil Chartered Accountants Cavish Court, A-35, Block 7 & 8 KCHSU, Shahrah-e-Faisal Karachi Pakistan 7.9 LEGAL ADVISOR OF THE COMPANY Abdul Wahab Haroon, Advocate Shop No. 1, Hashoo Terrace, Block-5, Clifton, Karachi Page 93 of 128

96 7.10 TRANSACTION LEGAL COUNCIL Mohsin Tayebaly & Co. 1st Floor, Dime Center, BC-4 Block 9, Kehkashan, Clifton, Karachi CONSULTANT TO THE OFFER Arif Habib Limited Arif Habib Center 23, MT Khan Road, Karachi Tel: Fax: Website: BOOK RUNNER Ismail Iqbal Securities (Pvt.) Limited C-132 (B) Miran Mohammad Shah Road, KDA Scheme 1 Karachi, Tel: Fax: sameer.khan@ismailiqbal.com Website: COMPUTER BALLOTER & SHARES REGISTRAR F.D. Registrar Services (SMC-Pvt.) Limited Suit 1705 A. 17 th Floor, Saima Trade Tower, I.I. Chundrigar Road Karachi Website: info@fdregistrar.com Contact no.: (92-21) / MATERIAL CONTRACTS & DOCUMENTS OF LIBERTY POWER TECH LIMITED Summary of Material Agreements S. No Nature of Agreement Counter Party 1 Power Purchase Agreement 2 Agreement Ancillary to the Power Purchase Agreement National Transmission & Dispatch Company Limited (NTDC) National Transmission & Dispatch Company Limited (NTDC) Execution Date July 1 st, 2008 February 27 th, 2009 Brief Description It stipulates the contractual terms of the sale and purchase of electricity between the Company and NTDC. Its term is for a period of 25 years. It is a support agreement to the primary Power Purchase Agreement Page 94 of 128

97 3 Implementation Agreement 4 Operation and Maintenance Agreement 5 Musharaka Agreement Musharaka Agreement Amendment Agreement Syndicate Finance Agreement Syndicate Finance Agreement Amendment Agreement 9 Project Funds Agreement 10 Supplemental Agreement to Project Funds Agreement 11 Payment Agreement 12 Payment Agreement Amendment Agreement Islamic Republic of Pakistan Wartsila Pakistan (Private) Limited Allied Bank Limited and Financial Institutions Allied Bank Limited and Financial Institutions Askari Bank Limited and Allied Bank Askari Bank Limited and Allied Bank Mr. Ashraf Mukaty, Liberty Mills Limited, Wartsila Development & Financial Services OY, Allied Bank Limited and Meezan Bank Limited Mr. Ashraf Mukaty, Liberty Mills Limited, Wartsila Development & Financial Services OY, Allied Bank Limited and Meezan Bank Limited Allied Bank Limited and Financial Institutions Allied Bank Limited and Financial Institutions June 16 th, 2008 May 9 th 2015 February 18 th, 2009 July 15 th, 2010 February 18 th, 2009 July 15 th, 2010 February 18 th, 2009 December 18 th, 2009 February 18 th, 2009 July 15 th, 2010 It guarantees payments to the Company if defaulted by the Power Purchaser It is for a period of 6 years whereby the counter party is responsible for the operation and maintenance of the plant The same pertains to an Islamic financing facility agreement to fulfill the initial financing requirements which sets out the terms of and conditions of constructing and owning the Musharaka Assets It is for amendments to the Musharaka Agreement for enhancement of the Musharaka Contribution amount due to foreign exchange fluctuations It is a secondary financing facility agreement to fulfill the initial financing requirements and it sets out the terms of the financing arrangement It sets forth amendments to the Syndicate Finance Agreement for enhancement of the financing facility due to foreign exchange fluctuations It sets out the equity investment of sponsors and other obligations in respect of the Project It sets forth certain amendments to the Project Funds Agreement to incorporate the new additional pledgor It sets out the exclusive use of Musharaka Assets allowed by contributing certificate holders in consideration of the rental payments. It sets forth certain amendments required to the Payment Agreement because of enhancement of Musharaka Page 95 of 128

98 13 Payment Guarantee Facility Agreement 14 Common Terms Agreement Common Terms Agreement Amendment Agreement Amended and Restated Project Funds Agreement Allied Bank Allied Bank Limited, Meezan Bank Limited, Arif Habib Bank Limited and Financial Institutions Allied Bank Limited, Meezan Bank Limited, Arif Habib Bank Limited and Financial Institutions Mr. Ashraf Mukaty, Liberty Mills Limited, Wartsila Development & Financial Services OY, Allied Bank Limited and Meezan Bank Limited February 18 th, 2009 February 18 th, 2009 July 15 th, 2010 August 21 st, 2010 Contribution amount due to foreign exchange fluctuations It states the payment guarantee requested by the Company from the Issuing Bank for the purposes of financing the Project It sets forth the certain common terms and conditions applicable to the financing facilities as extended by the Finance parties to the Company It sets forth certain amendments required to the Original Common Terms Agreement because of the enhancement of financing facility due to foreign exchange fluctuations It sets forth amended and restated terms to the Original Project Funds Agreement because of enhancement of financing facilities due to foreign exchange fluctuations Details of Short-Term Financing Facilities Bank Facility Limit (PKR) Mark-up Commission Date Sanctioned Expiry / Review Date Meezan Bank Limited Bank Alfalah Limited Allied Bank Limited Bank-Al-Habib Limited (Funded/Non Funded) Askari Bank Limited Habib Metro Bank Limited Short Term Finance Facilities Islamic Short Term Finance Facilities Islamic Short Term Finance Facilities Conventional Short Term Finance Facilities - Conventional Non Funded Short Term Finance Facilities - Conventional Short Term Finance Facilities - Conventional 4,000,000,000 2,000,000,000 1,595,000,000 1,000,000,000 1,000,000, ,000,000 3 Month Kibor % 3 Month Kibor % 3 Month Kibor % 3 Month Kibor % 0.15% per anum 3 Month Kibor % 3 Month Kibor % Details of Long-term Financing Facilities Bank Facility Outstanding amount (PKR) Mark-up Commission Date Sanctioned Expiry / Review Date Page 96 of 128

99 Allied Bank Limited Habib Bank Limited Meezan Bank Limited Bank AL-Habib Limited National Bank of Pakistan Bank Alfalah Limited Pak China Investment Co. Limited Faysal Bank Limited NIB Bank Limited Summit Bank Limited Habib Metropolitan Limited Pak Oman Investment Co. Limited Pak Iran Investment Co. Limiteds The Bank of Khyber Soneri Bank Limited Pak Libya Holding (Pvt) Limited Askari Bank Limited Long term Musharakah Long term Musharakah Long term Musharakah Long term Musharakah Long term Musharakah Long term Musharakah Long term Musharakah Long term Musharakah Long term Musharakah Long term Musharakah Long term Musharakah Long term Musharakah Long term Musharakah Long term Musharakah Long term Musharakah Long term Musharakah Long term finance facility 1,651,606,665 1,299,016,927 1,078,024, ,684, ,508, ,132, ,754, ,754, ,754, ,673, ,673, ,279, ,376, ,669,304 65,335,244 59,426, ,022,547 3 Month Kibor +3% 3 Month Kibor +3% 3 Month Kibor +3% 3 Month Kibor +3% 3 Month Kibor +3% 3 Month Kibor +3% 3 Month Kibor +3% 3 Month Kibor +3% 3 Month Kibor +3% 3 Month Kibor +3% 3 Month Kibor +3% 3 Month Kibor +3% 3 Month Kibor +3% 3 Month Kibor +3% 3 Month Kibor +3% 3 Month Kibor +3% 3 Month Kibor +3% February 18 th, 2009 February 18 th, 2009 February 18 th, 2009 February 18 th, 2009 February 18 th, 2009 February 18 th, 2009 February 18 th, 2009 February 18 th, 2009 February 18 th, 2009 February 18 th, 2009 February 18 th, 2009 February 18 th, 2009 February 18 th, 2009 February 18 th, 2009 February 18 th, 2009 February 18 th, 2009 February 18 th, Details of Related Party Agreements Title of Agreement Party to the Agreement Date Particular Rental Agreement Liberty Mills Limited 1 st July 2016 Office Space Rent Details of Power Purchase Agreements The Power Purchase Agreement (the Agreement ) was made as of July 1st, 2008 between National Transmission & Dispatch Company Limited (through Central Power Purchasing Agency) and Liberty Power Tech Limited (the Company ). The major provisions are as follows: 1. The Company will design, engineer, construct, insure, commission, operate and maintain an approximately 200 MW RFO fired electric power generation facility located near M-3 Industrial Estate Faisalabad, Punjab. Page 97 of 128

100 2. The Agreement shall continue in full force and effect for 25 years. 3. The Contract Capacity may be revised upward to the initial tested capacity under the PPA. 4. In accordance with the terms of PPA, the Power Purchaser shall take delivery of and pay to the Company for the dispatched and delivered net electrical output. 5. The Company shall not, without the prior written approval of the Power Purchaser, sell or deliver electric energy produced at the Complex to any person other than the Power Purchaser. 6. The Company may undertake scheduled outages only according to a schedule which has been proposed by the Company and accepted by the Power Purchaser. 7. The Company shall enter into one or more commercially reasonable fuel supply agreements. 8. The Company has to insure that it has procured supplies of fuel and the capacity to process, transport, store and handle such fuel for use at the Complex to comply with its electricity generation commitments, from reliable suppliers and transporters through one or more commercially reasonable fuel supply agreements. 9. The Company shall maintain on the Site, an inventory of RFO of thirty (30) days at full load. 10. The Power Purchaser shall be responsible for the design, construction, financing, completion and commissioning of the Power Purchaser interconnection facilities. 11. The Company at its own expense installed the metering system and procured and installed back up metering system in accordance with the Agreement. 12. The Power Purchaser shall, at its own cost and expense, procure and the Company shall install electronic data recording system capable of recording the Net Electrical Output measured by the Metering System on a continuous basis. 13. The Power Purchaser shall pay the Capacity Payments to the Company, in accordance with the procedures under the Agreement. 14. The Power Purchaser shall pay the Energy payments to the Company for dispatched and delivered Net Electrical Output for the relevant month. 15. The Company shall establish and maintain a separate reserve fund for the payment of Major Maintenance Expenses with a depositary institution and under depositary agreements reasonably satisfactory to the Power Purchaser. The Reserve fund shall be funded by the Company out of retained earnings 16. The Company shall obtain and maintain insurance policies with financially sound insurer(s). 17. All present and future federal, provincial municipal or other lawful taxes applicable to the Company shall be paid by the Company. 18. Upon occurrence of any Force Majeure Event after the Commercial Operation Date, the Power Purchaser shall pay to the Company Energy Payments for Net Electrical Output delivered during the pendency of such Force Majeure Event plus Capacity Payments for the Available Capacity that the Company is able to provide during pendency of the Force Majeure Event Implementations Agreement with GOP The Implementation Agreement (the Agreement ) was made at Islamabad as of June 16 th, 2008 between The President of Pakistan for and on behalf of The Islamic Republic of Pakistan ( GOP ) and Liberty Power Tech Limited (the Company ). Page 98 of 128

101 Major Provisions of the Agreement are as follows: 1. The Company will design, engineer, construct, insure, commission, operate and maintain an approximately 200 MW (gross ISO) RFO fired electric generation facility. 2. The GOP, through the Private Power and Infrastructure Board ( PPIB ), issued to the Company the Letter of Support for the design, engineering, construction, insuring, Commissioning, operation and maintenance of the Complex. 3. The license number IGSPL / 17 / 2008 dated 10 th April 2008 issued by NEPRA permitting the generation and supply of electricity by the Company from the Complex in accordance with the terms and conditions of such license. 4. Initial Shareholders were Mr. Ashraf Mukaty, Mr. Salim Mukaty, Mrs. Hamida S. Mukaty, Mrs. Nargis Shahid Soorty, Mrs. Marzia Obaid Bawany, Mrs. Farheen A. Mukaty and M/S Liberty Mills Limited. 5. The performance Guarantee is an unconditional, irrevocable, on-demand bank guarantee provided by the Company in favor of the GOP at the time GOP issued Letter of support to the Company, which secures the Company s obligation to achieve Financial Closing and Commercial Operation Date by the date specified in the Letter of Support. 6. The Implementation Agreement shall commence and be effective on the date of financial closing and shall, unless terminated earlier in accordance with the terms of Letter of Support or this Agreement continue in full force and effect for 25 years from commercial operation date. 7. As per the Agreement, the Company has identified and purchased the Site and shall make all applications for the Company consents to the appropriate relevant authorities and to issue quarterly reports on the status of such consents. In the event of any lapse of consent, the Company shall submit a report within three (3) days. 8. Pursuant to the Agreement, the GOP shall support and use all reasonable efforts to expedite consideration of the Company s applications for the Company Consents. 9. The GOP or any Relevant Authority may attach such non-discriminatory terms and conditions to the issuance of any of the Company Consents as are in accordance with the Laws of Pakistan. 10. With respect to certain disputes, barring Company Consents, Insurance, Taxes, Termination, any settlement or waiver in writing by the Power Purchaser of any dispute or breach under the PPA shall be binding on the GOP with respect to any issue or claim as the case may be based on the same facts or acts or omission by the Company and/or the Power Purchaser.(the Double Jeopardy rule ). 11. The Company shall obtain and maintain insurance from financially strong and internationally reputable insurance companies. 12. The Company shall not be subject to taxation in Pakistan on its profits and gains derived from electric power generation under the PPA. 13. The Company and its Contractor shall be entitled to import prior to Commercial Operations Date without restriction and exempt from Sales Tax but subject to the payment of the applicable Customs Duty, not to exceed five percent (5%) on value, determined under the Laws of Pakistan, of imported plant, machinery and equipment. The Company shall be entitled to export all items of plant and machinery imported by it for the purpose of remedying defects, repair or refurbishment outside Pakistan and to re-import the same upon. 14. The Company is permitted to open, operate and retain earnings in Specified Foreign Currency denominated bank accounts inside Pakistan. All the Company s transaction related to the Project will be initiated through bank accounts in Pakistan. Page 99 of 128

102 15. The Company is entitled to create a security interest in favour of the Financiers. Prior to Financial Close the Company delivered to PPIB a schedule of the terms sheet reflecting the proposed material terms of the Financing Documents. 16. As per the Agreement, GOP undertakes to the Company that neither it nor the Power Purchaser or any Federal Entity will expropriate, compulsorily acquire, nationalize or otherwise compulsorily procure any ordinary share capital or material assets. 17. A Company Event of Default shall give rise to the right on part of the GOP to terminate Implementation Agreement. However that no such event shall be a Company Event of Default if it results from the GOP s breach, if it results from a breach by the Power Purchaser or if it occurs as a result of a Force Majeure Event. 18. As a result of a Company Event of Default the GOP shall have the right to acquire all of the Company s rights, title and interests in and to the Complex and simultaneously pay to the Company the Compensation Amount as set out in the agreement. 19. In the event of GOP Event of Default, the Company may elect to transfer the Complex to the GOP and the GOP shall simultaneously pay the Company the Compensation Amount as set out in the Agreement Operation and Maintenance Contract Wartsila Pakistan (Private) Limited ( Operator or Contractor ) and Liberty Power Tech Limited (the Company ) have entered into Operation and Maintenance Agreement dated as of 9 th, May Major provisions are as follows: 1. The Operator shall be responsible for the operations and maintenance of the facility and shall perform the operations and maintenance services and applicable related activities as are necessary to operate and maintain the Facility. 2. The Company has the responsibility for the operations and maintenance of the Facility except to the extent as described above. 3. The operation and maintenance fee and overhauling fee shall be adjusted according to the Agreement 4. The Contractor guarantees that the annual availability of the Facility shall not be less than 92%. 5. The Contractor guarantees that the heat rate value shall not be greater than 7780 kj/kwh with clean fuel. 6. The Contractors guarantees that the net electrical energy generating capacity of the Facility (at reference condition) shall be 196, 139 kw. 7. If the Contractor fails to maintain the annual availability, the Contractor shall issue a credit note to the Company an amount equal to PKR. 3,500,000 per year for each once percent (1%) that the annual availability is below the guaranteed annual availability 8. In the event that the net electrical energy generating capacity of the Facility is less than the guaranteed capacity, the Contractor shall be liable to issue a credit note to the Company an amount equal to PKR 15,000 for each one kilowatt the capacity is below the guaranteed capacity. 9. During a given year, performance liquidity damages shall be limited to, and shall in no event exceed, 16% of the Contractor s annual turnover for such year. 10. The Contractor shall obtain insurance coverage and maintain the same in force through the term of the Agreement and for each renewal thereafter. Page 100 of 128

103 7.15 INSPECTION OF DOCUMENTS AND CONTRACTS Copies of the Memorandum and Articles of Association, the Audited Financial Statements, the Auditor s Certificates, Information Memorandum and copies of the agreements referred to in this OFSD may be inspected during usual business hours on any working day at the registered office of the Company from the date of publication of this OFSD until the closing of the subscription list LEGAL PROCEEDINGS Included in the trade debts of the Company is an amount of PKR 1, million (June 30, 2016: PKR ) relating to capacity purchase price not acknowledged by NTDC as the plant was not fully available for power generation. However the sole reason of this underutilization of plant capacity was non-availability of fuel owing to non payment by the NTDC. The management considers that the primary reason for claiming these payments is that the plant was available for electricity generation, however, the electricity was not generated due to the NTDC s default of making timely payments under the PPA, and as such the management believes that the Company cannot penalized in the form of payment deductions. After having agreed mutually with the NTDC, the matter was referred for expert determination as per the dispute resolution mechanism envisaged in the PPA. On August 15, 2015, the Expert gave his determination whereby the aforesaid amount was determined to be payable to the Company by the NTDC. Pursuant to the Expert s determination, the Company has demanded the payment of the aforesaid amount of PKR 1, million from the NTDC, which has not yet been paid. Consequently, under the terms of PPA, the Company has filed petition for arbitration in The London Court of International Arbitration ( LCIA ) and where various Independent Power Producers (IPPs) including the Company have filed the Statement of Claim before LCIA on October 28, Further, the NTDC also has filed a Statement of Defence on January 20, 2017 in LCIA. In November 2015, the Government of Pakistan ( GOP ) through Private Power & Infrastructure Board ( PPIB ) filed a case in the court of Senior Civil Judge, Lahore, against the aforementioned decision of the Expert, praying it to be illegal, which is pending adjudication. Further, NTDC filed a stay application in the LCIA before the Arbitrator to stay the arbitration proceedings. During the period, in response to NTDC s stay application, the Arbitrator through his order dated July 8, 2016, has declared that the arbitration shall proceed and has denied NTDC s request for a stay. Furthermore, the Arbitrator has ordered NTDC to withdraw abovementioned case filed in the court of Senior Civil Judge, Lahore and has refrained NTDC from taking any further steps therein to disrupt the arbitration proceedings. On August 26, 2016 the joint legal counsel of IPPs sent a notice to GOP through PPIB inviting them to participate in the arbitration proceedings, however, the PPIB on October 25, 2016 filed another civil suit in the court of Senior Civil Judge, Lahore, against the IPPs including the Company pleading to suspend the aforesaid notice dated August 26, 2016 issued on behalf of IPPs and to declare all the claims and actions of IPPs in relation to the Arbitration Proceedings before the LCIA as illegal and unlawful. The Court of Senior Civil Judge, Lahore on October 27, 2016 suspended the aforementioned notice issued by the IPPs. Consequently, the IPPs including the Company jointly filed the appeal in the District and Session Court, Lahore requesting to suspend such Impugned Order dated October 27, 2016, which was granted through District and Session Judge Order dated December 17, Based on the advice of the Company s legal counsel and favorable Expert s determination, the management believes that the above amount is likely to be recovered by the Company. Consequently, no provision for the abovementioned amount has been made in interim financial statements as of December 31, National Electric Power Regulatory Authority (NEPRA) issued an order dated February 8, 2013 through which it raised a demand of PKR million payable by the Company to NTDC for the period up to June 30, 2011 in respect of Calorific Value ( CV ) adjustment on fuel consumed for power generation as per the terms of the PPA and various CV adjustment mechanisms prescribed by NEPRA. NEPRA directed the Company to submit consignment-wise record of CV for the period up to June 30, The Company disputed such direction as it was not required to maintain consignment-wise record prior to July However, NEPRA computed retrospectively and determined Rs million payable by the Company to NTDC for the period up to June 30, 2011 in respect of CV adjustment on the basis of the mechanism directed by it in July The Company filed a Motion for Leave for Review before NEPRA Page 101 of 128

104 requesting it to reconsider its decision, which was decided against the Company. Consequently, the Company filed a writ petition before the Islamabad High Court against NEPRA's decision on the grounds that change in CV adjustment mechanism in July 2011 cannot be applied retrospectively and credible information is also not available from any source upon which CV adjustment computations can be made. The said writ petition was dismissed by the Islamabad High Court. Subsequently, the Company has filed for Leave to Appeal with Honorable Supreme Court of Pakistan against the decision of the Islamabad High Court. The management still believes that there are meritorious grounds to support the Company s stance and NEPRA s aforementioned decision is likely to be revoked. However, as a matter of prudence, the Company has made a provision of PKR million in financial statements. In July 2011, NEPRA revised its CV adjustment mechanism and directed all Independent Power Producers (IPPs) to maintain consignment-wise CV record of the fuel received and consumed for power generation. Consequently, the Company started maintaining such CV record after such direction was received from NEPRA and as per this mechanism, the Company is adjusting the revenue accordingly. The Company s recorded Advances, Deposits, Prepayments and Receivables includes an amount of PKR million paid by the Company in respect of additional sales tax inclusive of default surcharge and penalty imposed under an order passed by the Deputy Commissioner Inland Revenue as a result of scrutiny of sales tax returns of the Company from July 2010 to June The Company challenged the aforementioned order and during the period, the Commissioner Appeals revoked the levy of PKR million and remanded the issue of the remaining amount to the Deputy Commissioner Inland Revenue till the adjudication of a similar issue by the Honorable High Court of Islamabad. Management of the Company believes that the case would be decided in favor of the Company and, therefore, no provision has been made in these financial statements. The Company has received a Show Cause notice from FBR (for Tax year 2011) alleging non-deduction of withholding tax on technical services deemed to be obtained during the course of procuring power generation plant though the Company had already obtained tax exemption certificate at the time of plant import. Based on legal and tax advisor s advice, the Company has obtained a stay from Sindh High Court against the said notice. The Company s legal and tax advisors are confident that the said notice does not have any strong basis to withstand in the eyes of law and the matter is time barred MEMORANDUM OF ASSOCIATION The Memorandum of Association, inter alia, contains the objects for which the Company was incorporated and the business which the Company is authorized to undertake. A copy of the Memorandum of Association is annexed to this OFSD and with every issue of the OFSD except the one that is released in newspapers as advertisement FINANCIAL YEAR OF THE COMPANY The financial year of the Company commences on 1st July and ends on 30th June each year. Page 102 of 128

105 8 APPLICATION AND ALLOTMENT INSTRUCTIONS 8.1 ELIGIBLE INVESTORS INCLUDE: 1. Pakistani citizens resident in or outside Pakistan or Persons holding dual nationalities including a Pakistani nationality; 2. Foreign Nationals whether living in or outside Pakistan 3. Companies, bodies corporate or other legal entities incorporated or established in or outside Pakistan (to the extent permitted by their constitutive documents and existing regulations, as the case may be); 4. Mutual Funds, Provident / Pension / Gratuity Funds / Trusts, (subject to the terms of the Trust Deed and existing regulations); and 5. Branches in Pakistan of companies and bodies corporate incorporated outside Pakistan. 8.2 APPLICATION MUST BE MADE ON THE COMMISSION S APPROVED APPLICATION FORM OR ALEGIBLE PHOTOCOPY THEREOF ON A PAPER OF A4 SIZE WEIGHING AT LEAST 62 GM 8.3 COPIES OF THE OFSD Copies of this OFSD and applications forms can be obtained from members of PSX, the Bankers to the Offer and their Branches, the Consultant to the Offer, Book Runner and the registered office of the Company. The OFSD and the Application Form can also be downloaded from the following websites: The applicants are required to complete the relevant sections of the application in order to get shares in scrip-less form. In accordance with the provisions of the Central Depositories Act, 1997 and the CDCPL Regulations, credit of such shares is allowed ONLY in the applicant s own CDC account. 8.4 NAMES(S) AND ADDRESS (ES) MUST BE WRITTEN IN FULL BLOCK LETTERS, IN ENGLISH AND SHOULD NOT BE ABBREVIATED 8.5 ALL APPLICATIONS MUST BEAR THE NAME AND SIGNATURE CORRESPONDING WITH THE ONE RECORDED WITH THE APPLICANT S BANKER. IN CASE OF DIFFERENCE OF SIGNATURE WITH THE BANK AND COMPUTERIZED NATIONAL IDENTITY CARD (CNIC) OR THE NATIONAL IDENTITY CARD FOR OVERSEAS PAKISTANI (NICOP) OR PASSPORT, BOTH THE SIGNATURES SHOULD BE AFFIXED ON THE APPLICATION FORM. 8.6 APPLICATIONS MADE BY INDIVIDUAL INVESTORS 1. In case of individual investors, an attested photocopy of CNIC (in case of Resident Pakistanis) / NICOP or Passport (in case of Non-Resident Pakistanis) as the case may be, should be enclosed and the number of CNIC / NICOP / Passport should be written against the name of the applicant. Copy of these documents can be attested by any Federal / Provincial Government Gazette Officer, Councilor, Oath Commissioner or Head Master of High School or bank manager in the country of applicant's residence. 2. Original CNIC / NICOP / Passport, along with one attested photocopy, must be produced for verification to the Banker to the Offer and the applicant s banker (if different from the Banker to the Offer) at the time of presenting the application. The attested photocopy will, after verification, be retained by the bank branch along with the application. Page 103 of 128

106 8.7 APPLICATIONS MADE BY INSTITUTIONAL INVESTORS 1. Applications made by companies, corporate bodies, mutual funds, provident / pension / gratuity funds / trusts and other legal entities must be accompanied by an attested photocopy of their Memorandum and Articles of Association or equivalent instrument / document. Where applications are made by virtue of Power of Attorney, the same should also be submitted along with the application. Any Federal / Provincial Government Gazette Officer, Councilor, Bank Manager, Oath Commissioner and Head Master of High School or bank manager in the country of applicant's residence can attest copies of such documents. 2. Attested photocopies of the documents mentioned in 8.7 (i) must be produced for verification to the Banker to the Offer and the applicant's banker (if different from the Banker to the Offer) at the time of presenting the application. The attested copies, will after verification, be retained by the bank branch along with the application. 8.8 ADDITIONAL INSTRUCTIONS FOR INVESTORS 1. Only one application will be accepted against each account, however, in case of joint account, one application may be submitted in the name of each joint account holder. 2. Joint application in the name of more than two persons will not be accepted. In case of joint application each applicant must sign the application form and submit attested copies of their CNICs / NICOP / Passport. The share will be credited to the CDS account mentioned on the face of the form and where any amount is refundable, in whole or in part, the same will be refunded by cheque or other means by post, or through the bank where the application was submitted, to the person named first on the application form, without interest, profit or return. Please note that joint application will be considered as a single application for the purpose of allotment of Shares. 3. Subscription money must be paid by check drawn on applicant's own bank account or pay order / bank draft payable to one of the Bankers to the Offer Liberty Power Tech General Portion and crossed A/C PAYEE ONLY. 4. For the applications made through pay order / bank draft, it would be permissible for a Banker to the Offer to deduct the bank charges while making refund of subscription money to unsuccessful applicants through pay order / bank draft individually for each application. 5. The applicant should have at least one bank account with any of the commercial banks. The applicants not having a bank account at all (non-account holders) are not allowed to submit application for subscription of Shares. 6. Applications are not to be made by minors and / or persons of unsound mind. 7. Applicants should ensure that the bank branch, to which the application is submitted, completes the relevant portion of the Application Form. 8. Applicants should retain the bottom portion of their Application Forms as provisional acknowledgement of submission of their applications. This should not be construed as an acceptance of the application or a guarantee that the applicant will be allotted the number of Shares for which the application has been made. 9. Making of any false statements in the application or willfully embodying incorrect information therein shall make the application fictitious and the applicant or the bank shall be liable for legal action. 10. Bankers to the Offer are prohibited to recover any charges from the subscribers for collecting subscription applications. Hence, the applicants are advised not to pay any extra charges to the Bankers to the Offer. 11. It would be permissible for a Banker to the Offer to refund subscription money to unsuccessful applicants having an account in its bank by crediting such account instead of remitting the same by cheque, pay order or bank draft. Applicants should, therefore, not fail to give their bank account numbers. Page 104 of 128

107 12. Submission of false and fictitious applications is prohibited and such applications money may be forfeited under section 87(8) of the Securities Act, ADDITIONAL INSTRUCTIONS FOR FOREIGN / NON-RESIDENT INVESTORS 1. In case of foreign investors who are not individuals, applications must be accompanied with a letter on applicant's letterhead stating the legal status of the applicant, place of incorporation and operations and line of business. A copy of Memorandum of Association or an equivalent document should also be enclosed, if available. Where applications are made by virtue of Power of Attorney, the same must be lodged with the application. Copies of these documents can be attested by the bank manager in the country of applicant's residence. 2. Foreign / Non- resident investors should follow payment instructions given in Section of this OFSD BASIS OF ALLOTMENT The basis and conditions of transfer of shares to the General Public shall be as follows: 1. The minimum value of application will be calculated as Offer Price x 500 Shares. Application for amount below the minimum value shall not be entertained. 2. Application for shares must be made for 500 shares or in multiple of 500 shares only. Applications which are neither for 500 shares nor for multiples of 500 shares shall be rejected. 3. Allotment / Transfer of Shares to successful applicants shall be made in accordance with the allotment criteria / instructions disclosed in the OFSD. 4. Allotment of Shares shall be subject to scrutiny of applications in accordance with the criteria disclosed in the OFSD and / or the instructions by the Securities & Exchange Commission of Pakistan. 5. Applications, which do not meet the above requirements, or applications which are incomplete will be rejected. The applicants are, therefore, required to fill in all data fields in the Application Form. 6. The Company will credit the respective CDS accounts of the successful applicants LIST OF BANKERS TO THE OFFER Code Name of Bankers Code Name of Bankers 01 Askari Bank Limited 09 Habib Bank Limited 02 Albaraka Bank Limited 10 Habib Metropolitan Bank Limited 03 Allied Bank Limited 11 MCB Bank Limited 04 Bank Alfalah Limited 12 Meezan Bank Limited 05 Bank Alhabib Limited 13 Soneri Bank Limited 06 BankIslami Pakistan Limited 14 Summit Bank Limited 07 Dubai Islamic Bank Limited 15 United Bank Limited 08 Faysal Bank Limited 8.12 CODE OF OCCUPATION OF INVESTORS / APPLICANTS Code Occupation 01 Business 02 Business Executive 03 Service Page 105 of 128

108 04 Housewife 05 Household 06 Professional 07 Student 08 Agriculturist 09 Industrialist 10 Other 8.13 NATIONALITY CODE Code Name of Country 001 U.S.A 002 U.K 003 U.A.E 004 K.S.A 005 Oman 006 Bangladesh 007 China 008 Bahrain 009 Other 8.14 E-IPO FACILITIES In order to facilitate the investors, the Offeror has arranged provision of e-ipo facility through United Bank Limited ( UBL ), Summit Bank Limited ( SMBL ) and Bank Alfalah Limited ( BAFL ) that are among the Bankers to the Offer. The accountholders of UBL can use UBL net-banking to submit their applications online via link: The accountholders of SMBL can use SMBL net-banking to submit their applications online via link: The accountholders of BAFL can use BAFL net-banking to submit their applications online via link: The accountholders of UBL, SMBL and BAFL can submit their applications through these links 24 hours a day during the subscription period which will close at 12:00 midnight on DD/MM/2017. The Central Depository Company of Pakistan Limited (CDC) has developed an e-ipo system through which applications for subscription of shares can be submitted electronically through the internet. Investors are strongly encouraged to visit the link to learn more about CDC e-ipo facility. Further, detailed process for subscribing through Centralized e-ipo and payment instructions can be accessed via link In case any issue is encountered during or after the IPO subscription, investors can contact CDC call center at or at info@cdcpak.com during business hours. Page 106 of 128

109 9 INSTRUCTIONS FOR REGISTRATION AND BIDDING INSTRUCTIONS FOR REGISTRATION AND BIDDING REGISTRATION PERIOD OPENS FROM [MONTH] [DATE], 2017 TO [MONTH] [DATE], 2017 BETWEEN 9:00 AM TO 5:00 PM AND BETWEEN 9:00 AM TO 3:00 PM ON [MONTH] [DATE], 2017 BIDDING PERIOD OPENS FROM [MONTH] [DATE], 2017 TO [MONTH] [DATE], 2017 BETWEEN 9:00 AM TO 5:00 PM OFFER FOR SALE OF ORDINARY SHARES OF LIBERTY POWER TECH LIMITED ( LPTL OR THE COMPANY ) THROUGH BOOK BUILDING PROCESS AT A FLOOR PRICE OF PKR 40.00/- PER SHARE The Present Offer comprises of 126,146,014 Ordinary Shares (25% of the Total Paid-up Capital of the Company with Face Value of PKR 10.00/- each). The bidders shall be allowed to place bids for hundred percent (100%) of the Offer size and the Strike Price shall be the price at which the hundred percent (100%) of the Offer is subscribed. However, the successful bidders shall be allotted and issued only seventy-five percent (75%) of the Offer size i.e. 94,609,014 and the remaining twenty five percent (25%) i.e. 31,537,000 shall be offered to the retail investors. Book Building portion of the Offer comprises of 94,609,014 Ordinary Shares (75% of the Total Offer Size) at a Floor Price of PKR 40.00/- per share (including a premium of PKR 30.00/- per share) Instructions for Registration and Bidding 1. Only registered investors will be eligible to participate in the bidding process. 2. Investors are required to fill in the Registration Form and submit the complete Registration Form along with Margin Money at the Bid Collection Centres during the Registration Period. 3. For deposit of Margin Money only Pay Orders, Demand Drafts or a bank receipt evidencing Online Transfers in the designated bank account shall be accepted during the Bidding Period. Each eligible investor shall only submit a single pay order, demand draft or evidence of online transfer of money along with the Registration Form. It may also be noted that only a single pay order, demand draft or evidence of online transfer of money shall be accepted by the Book Runner along with each Additional Payment Form. 4. Once the investor is registered in the System, the investor will receive Username and Password via an automatically generated through the System software. 5. Investors can directly place their bids online during the Bidding Period by using the Username and Password provided to them via or submit the Bidding Form at the bid collection centres in person. 6. On entry of bid in the System, the investors will receive an confirmation of their bid via the System software. 7. Investors can upward revise their bids online. Please visit to access online portal. Online access will be available for upward bid revisions during the Bidding Period from 9:00 am to 5:00 pm. An investor will not be allowed to place or upward revise a bid with a price variation of more than 10% of the prevailing Indicative Strike Price. NO DOWNWARD REVISION OR WITDRAWAL OF BID SHALL BE ALLOWED. Please Note: 1. Fill in all the particulars of the form accurately in BLOCK LETTERS. 2. For deposit of margin money, only Pay Orders, Demand Draft will be accepted or online transfer facility (pay order or demand draft may be deposited at any branch of Summit Bank Limited and evidence to be submitted to the Book Runner) into the respective Book Building account of the Offeror, A/C No. [Account number], titled Liberty Power Tech Book Building, maintained at Summit Bank Limited, [Branch], [City]. 3. Kindly provide a copy of CNIC or Passport (in case of Individual Investors) or NTN Certificate / Certificate of Incorporation (in case of Institutional Investor) along with the Registration Form. 4. Applicants are requested to provide accurate contact details. Please provide accurate landline number(s), mobile number(s), fax number(s), UIN(s), NTN number and address(es). Page 107 of 128

110 5. Bidders are requested to provide two copies of the bidding instrument at the time of bid submission. 6. The National Taxation Number ( NTN ) of Liberty Power Tech Limited is This NTN shall be required by applicants for making their respective pay orders. 7. The Bidder is required to duly fill Additional Payment Form for depositing additional funds for enhancement of deposit amount. 8. All payments are to be made in favor of Liberty Power Tech Book Building at any of the following bidding centers: Karachi Contact Officer: Yasir Abbas Abdul Qadir Direct No.: Mobile No.: PABX No.: Fax No.: yasir.abbas@arifhabibltd.com abdul.qadir@arifhabibltd.com Postal Address: Arif Habib Center, 23 MT Khan Road, Karachi Naya Nazimabad, Mangophir Road, Karachi Lahore Azad Kashmir Contact Officer: Muhammad Waleed Rahmani Atif Zahoor / Zia Ullah Direct No.: Mobile No.: Fax No.: waleed.rahmani@arifhabibltd.com atif.zahoor@summitbank.com.pk ziaullah@summitbank.com.pk Postal Address: Room # 220, Arif Habib Limited, Lahore Stock Exchange, Lahore NS Tower 119 F/1, Kotli Road Mirpur Azad Kashmir Islamabad Contact Officer: Awais Ahmed Riaz Hussain Direct: PABX: Fax No: awais.ahmed@summitbank.com.pk riazhussain@summitbank.com.pk Postal Address: Plot # 109, East F-7/G-7, Jinnah Avenue, Blue Area-Islamabad Plot # 109, East F-7/G-7, Jinnah Avenue, Blue Area-Islamabad Peshawar Contact Officer: Sohail Akhtar Ihsan-Ul-Haq Direct: PABX: Fax No.: sohail.akhtar@summitbank.com.pk ihsan.haq@summitbank.com.pk Postal Address: Deans Trade Centre, Islamia Road, Saddar, Peshawar Quetta Contact Officer: Syed Noman Mansoor Muhammad Ali Direct: PABX: Fax No.: Deans Trade Centre, Islamia Road, Saddar, Peshawar Page 108 of 128

111 Postal Address: Ground Floor, Malik Plaza, Near Adara-e- Ground Floor, Malik Plaza, Near Adara-e- Saqafat, M.A. Jinnah Road, Quetta Saqafat, M.A. Jinnah Road, Quetta Gilgit / Baltistan Contact Officer: Shahjahan / Qurban Karim Direct: Fax No.: sjhunzai@summitbank.com.pk qurbankarim@summitbank.com.pk Postal Address: Khasra# 1103,1112 & 1113, Haji Ghullam Hussain Building Raja Bazar, Gilgit 9. CASH SHOULD NOT BE SUBMITTED WITH REGISTRATION FORM AT THE BID COLLECTION CENTER. 10. THE BID SHOULD BE SUBMITTED ON THE PRESCRIBED BIDDING FORM ALONG WITH THE REGISTRATION FORM IN PERSON OR THROUGH FAX AT THE NUMBERS MENTIONED IN NOTE 8 ABOVE. REGISTERED INVESTORS CAN ALSO PLACE THEIR BIDS DIRECTLY VIA THE ONLINE PORTAL BY VISITING Bids can be placed at Limit Price or Step Bid. a) Payment for Limit Price: If investors are placing their bids through Limit Price then they shall deposit the Margin Money based on the number of shares they are bidding for at their stated bid price. For instance, a Bidder may bid for 2 million shares at PKR per share, then total Application Money would amount to PKR 80 million. The Bid Amount will be PKR 80 million. Since the Bidder has placed a Limit Bid of PKR per share, this indicates that he / she / it is willing to subscribe the shares at a price up to PKR per share. b) Payment for Step Bid: If investors are placing their bids through Step Bid which is a series of limit bid at increasing prices then they shall deposit the Margin Money / Bid Amount based on the total number of shares they are bidding for at their stated bid price. The aggregate amount of step bid shall not be less than PKR 1,000,000/- and the amount of any step shall also not be less than PKR 1,000,000/-. Under this bidding strategy, Bidders place a number of Limit Bids at different increasing price levels. The Bidders may, for instance, make a bid for 0.5 million shares at PKR per share, 1 million shares at PKR per share and 1.5 million shares at PKR per share then in essence the investor has placed one Step Bid comprising of three Limit Bids at increasing prices. The bid amount will be PKR 128 million. In case of Individual Investor, the Margin Money will be 100% i.e. PKR 128 million whereas in case of Institutional Investor the Margin Money shall be 25% of the bid amount i.e. PKR 32 million. 12. The applicant, if Individual Investor, shall submit amount of 100% of the application money as Bid / Margin Money whereas Institutional Investors shall submit not less than 25% of the application money. Page 109 of 128

112 13. Book Runner shall not accept or register any new Bidders after 3:00pm during the last day of Bidding Period. 14. The Bidder can view the color of the book, i.e. bid price and number of shares against each bid price online anytime during the Bidding Period at the following websites: Successful Bidders shall be intimated, within one (1) working day of the closing of the Bidding Period, the Strike Price and the number of shares provisionally allotted to each of them. 16. Upon intimation by the Book Runner of final allocation, successful institutional bidders shall deposit their balance margin money within three (3) days of such intimation, if required, as consideration against allotment of shares. 17. Where a successful Bidder defaults in payment of shares allotted to him, the Margin Money deposited by such Bidder shall be forfeited to the Book Runner. 18. Final allotment of shares out of the Book Building portion shall be made after receipt of full subscription money from the successful bidders; however, shares to such bidders shall be issued securities only after the end of the public subscription, in the form of book-entry to be credited in their respective accounts. All the bidders shall, therefore, provide number of their accounts. 19. The bidders who have made bids below the Strike Price shall not qualify for allotment of securities and the Book Runner shall intimate their respective banks for unblocking their Bid Money within one (1) working day of the close of the bidding period and the refunds to such bidders shall be made within three (3) working days from the close of the bidding period. 20. The bid money of bidders who have undertaken to subscribe the unsubscribed retail portion shall remain deposited or blocked till allotment of unsubscribed retail portion, if any, to them on prorata basis. Page 110 of 128

113 10 REGISTRATION FORM Page 111 of 128

114 11 DUPLICATE REGISTRATION FORM Page 112 of 128

115 12 BIDDING FORM Page 113 of 128

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117 13 ADDITIONAL PAYMENT FORM Page 115 of 128

118 14 BID REVIISION FORM Page 116 of 128

119 15 OFFERORS SIGNATURE -sd- Muhammad Salim Mukaty Chairman / Director -sd- Muhammad Ashraf Director -sd- Hamida Salim Mukaty Director -sd- Farheen Ashraf Director For and behalf of Liberty Mills Limited -sd- Muhammad Ashraf Director -sd- Asif Younus Bawany Director 15.1 WITNESSES -sd- Adamjee Yaqoob Chief Financial Officer -sd- Kashif Hanif Company Secretary Date: February 04, 2017 Page 117 of 128

120 16 SIGNATORIES TO THE OFSD -sd- Muhammad Salim Mukaty Director -sd- Muhammad Ashraf Director -sd- Hamida Salim Mukaty Director -sd- Nargis Shahid Soorty Director -sd- Marzia Obaid Bawany Director -sd- Farheen Ashraf Director -sd- Yousuf Mukaty Director -sd- Azam Sakrani Chief Executive Officer 16.1 WITNESSES -sd- Adamjee Yaqoob Chief Financial Officer -sd- Kashif Hanif Company Secretary Date: February 04, 2017 Page 118 of 128

121 17 MEMORANDUM OF ASSOCIATION Page 119 of 128

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128 18 APPLICATION FORM Page 126 of 128

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