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Tuesday, May 22nd, 2018

Sapphire Textile Mills Limited’s Notice of Extra Ordinary General Meeting

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Karachi: Notice is hereby given that an Extra Ordinary General Meeting of the shareholders of Sapphire Textile Mills Limited (SAPT) will be held on Tuesday the June 21, 2011 at 12:00 noon at registered office of the company situated at 212, Cotton Exchange Building I.I. Chundrigar Road, Karachi to transact the following business.

Ordinary Business:

1. To confirm minutes of last general meeting of the shareholders.

Special Business:

2. To consider and if approved to pass with or without modification the following resolution under section 208 of the Companies Ordinance, 1984:

Resolved that the consent and approval of the Company be and is hereby accorded for further Equity Investment up to Danish Krone (DKK) 1,715,000 in the Equity of Beirholms Sapphire A/S Company incorporated in Denmark, this fresh investment will enhance the equity investment of the Company up to Danish Krone (DKK) 3,675,000. Further a counter security for Danish Krone (DKK) 4,900,000 be issued in favor of Beriholms Vaeverier to cover the guarantee provided by them for credit facility of DKK 10 million from Jyske Bank to the Beirholms Sapphire A/S. The Chief Executive of the Company be and is hereby authorized to take all necessary steps in this respect.

Further Resolved that the Company be and is hereby authorized to make investment up to Rs50 million (Rupees Fifty Million only) from time to time in Sapphire Dairies (Private) Limited, an associated company, by way of loans and advances, and the return on any outstanding amount of loan or advance shall not be less than the rate of 3 months KIBOR + 200 pbs and such loans and advances shall be repayable within the 5 years period or as agreed by the Company.

Further resolved that the Chief Executive be and is hereby authorized to undertake such investments and arrange counter security as and when deemed necessary, as per requirements of the Beirhalms Sapphire A/S and Sapphire Dairies (Private) Limited.

A Statement under Section 180(1) (b) of the Companies Ordinance, 1984, read with S.R.O. 865 (1)/ 2000 dated December 6, 2000 issued by the Securities and Exchange Commission of Pakistan is annexed to the Notice of the Meeting send to the shareholders.

Other Business:

2. To transact any other business with the permission of the Chair.

Notes

1. Statement under section 160(1)(b) containing special Business has been sent to the members along notice.

2. A member entitled to attend and vote at this meeting may appoint another member as his/her proxy to attend and vote on his/her behalf. Proxies in order, to be valid must be deposited at the Registered Office of the Company not less then 48 hours before the time of the meeting.

3. The share transfer books of the Company shall remain closed from 15th June, 2011 to 21st June, 2011 (both days inclusive)

4. CDC shareholders desiring to attend the meeting are requested to bring their original National Identity Cards, Account/sub Account and particular of participants ID numbers and account numbers in CDS, for identification purpose and in case of proxy to enclose an attested copy of his/her National identity Card.

5. Shareholders are requested to notify the Company of any change in their addresses.

Statement under Section 160(1) (b) of the Companies Ordinance, 1984

This statement sets out the material facts concerning the special business, given in agenda item, to be transacted at the Extra Ordinary Genera Meeting of the Company, which will be held on 21st June, 2011.

1. Equity Investment in Beirholms Sapphire A/S

Beirholms Sapphire N/S was incorporated in Denmark, having Equity of Danish Krone (DKK) 4000,000 divided into 4,000 shares of Danish Krone (DKK) 1,000 each. The Company deals in Marketing of Home Textiles. The Directors of Sapphire Textile Mills Limited wish to invest further DKF 1,715,000 in the said company to acquire 1,715 shares of Danish Krone (DKK) 1,000 each of the Beirholms Sapphire A/S resulting in total investment of DKK 3,675,000 divided into 3675 shares of DKK 1,000 each. Other information as desired vide S.R.O No.865 (1)/2000 to be annexed with the resolution for approval of investments as under:

1. Name of investee Company:

Beirholms Sapphire A/S is a foreign company incorporated in Denmark which deals in Marketing of home textiles. The management of Sapphire Textile Mills Limited has already invested Danish Krone (DKK) 1,960,000 and wish to make further equity investment up to Danish Krone (DKK) 1,715,000 in the said company.

2. Nature, amount and extent of investment:

It is a Long Term Equity Investment up to Danish Krone (DKK) 3,675,000 in the Equity of Beirholms Sapphire A/S.

The Bairholms Sapphire A/S has arranged credit facility of DKK 10 million from Jyske Bank against Guarantee provided by Beirholms Vaeverier the 51% shareholder in the company as Jyske Bank does not wish to have guarantors based outside of Denmark. To meet the requirement of the Bank Beirholms Vaeverier agreed to accept a counter security up to Danish Krone (DKK) 4,900,000 from Sapphire Textile Mills Limited.

3. Aggregate market price of the shares intended to be purchased

Not Applicable.

4. Break up value of shares intended to be purchased

Break up value of Shares of Beirholms Sapphire A/S is Danish Krone (DKK) 439.50 per share.

5. Price at which shares will be purchased:

At par value of Danish Krone (DKK) 1,000 per share

6. Earning per share of Investee Company in last three years

Earning per share of last three year of Beirhoims Sapphire A/S s as under:

Beirholms Sapphire A/S
2010 (331.25)
2009 (458.50)
2008 N/A

7. Source of funds from where shares will be purchased:

Shares will be purchased from company’s own sources.

8. Period for which investment will be made:

Long term equity investment in Beirholms Sapphire A/S

9. Purpose of investment:

It is a strategic investment which will result in increase sales of Home Textiles in Europe for Sapphire textile Millis Limited. Beirholms Sapphire A/S is the marketing company for home textile which will procure orders and part of which will be for Sapphire Textile Mills Limited resulting in increase in Exports for Sapphire Textile Mills Limited.

10. Benefits likely to accrue to the company and the shareholders from proposed investment.

The proposed investment in Beirholms Sapphire A/S will cause increase in exports, hence it will result in the higher profit for the company which will ultimately benefit the shareholders.

11. Interest of directors and their relatives in the investee company:

Mr. Nadeem Abdullah has been appointed as Director Beirholms Sapphire S/A on behalf of Sapphire Textile Mills Limited. He has not other interest in the investee company.

2. Loans and Advances to Sapphire Dairies (Private) Limited

Sapphire Dairies (Private) Limited is an Associated Company of Sapphire Textile Millis Limited having Authorized Capital of Rs.400,000,000 divided into 40,000,000 shares of Rs.10 each. The Company is engaged in Dairy farming and the principle business of the company is to produce and sell milk and milk products. Five (5) Directors of Sapphire Dairies (Private) Limited (SDPL) are also the Directors in Sapphire Textile Mills Limited (STML). Other information as desired vide S.R.O. No.885 (1)/2000 to be annexed with the resolution for approval of investment is as under:

1. Name of investee Company:

Sapphire Dairies (Private) Limited is a company incorporated in Pakistan and is engaged in Dairies business.

2. Financial position of the investee Company

The project is at development stage and the company has experienced the initial setting up period. Years 2010 was the first year of production in which it has made loss of Rs.17, 577 million. The management is of the opinion that the company will be financial sound in due course of time as the number of milking animals increase.

3. Rate of mark-up to be charged:

3 month KIBOR +200 pbs on the outstanding amounts.

4. Particular of Collateral security:

Note considered necessary as both companies are under common management control.

5. Source of funds from where shares will purchased:

Shares will be purchased from company’s own sources.

6. Repayment schedule:

Long term loan for 5 years or as agreed by the companies to Sapphire Dairies (Private) Limited

7. Purpose of investment:

The Project is at development stage and the funds are needed to increase number of animals and to meet the working capital requirements of Sapphire Dairies (Private) Limited.

viii. Benefits likely to accrue to the company and the shareholders from the proposed investment Loans and advances to Sapphire Dairies (Private) Limited will earn interest Income.

For more information, contact:

Zeeshan

Secretary

Sapphire Textile Mills Limited

212, Cotton Exchange Building

I.I. Chundrigar Road, Karachi (Pakistan)

UAN: +9221 1000100

Fax: +9221 2461705

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