ANNOUNCEMENT NEW CONTINUING CONNECTED TRANSACTIONS RELATING TO - PDF

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Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this announcement, make no representation as to its accuracy or completeness
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Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this announcement, make no representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this announcement. (Incorporated with limited liability under the laws of Bermuda) Website: (Stock Code: 00142) ANNOUNCEMENT NEW CONTINUING CONNECTED TRANSACTIONS RELATING TO (1) A LEASE AGREEMENT BETWEEN THE BOGASARI FLOUR MILLS DIVISION OF PT INDOFOOD SUKSES MAKMUR TBK AND PT TARUMATEX IN RELATION TO THE FLOUR BUSINESS OF THE INDOFOOD GROUP (2) A CONSULTANT SERVICES CONTRACT BETWEEN PT INDOFOOD SUKSES MAKMUR TBK AND PT INDOTEK KONSULTAN UTAMA IN RELATION TO THE VARIOUS CATEGORIES OF BUSINESSES OF THE INDOFOOD GROUP INTRODUCTION The Company announces the entering into of two new continuing connected transactions on 31 October 2011 relating to the Indofood Group: (a) the Tarumatex Rental Contract; and (b) the IKU Consultant Services Contract, in each case between a member of the Indofood Group and an associate of Mr. Anthoni Salim. Mr. Anthoni Salim is the Chairman of the Board and a substantial shareholder of the Company and President Director and CEO of Indofood. 1 AGGREGATE ANNUAL CAPS FOR THE FLOUR BUSINESS TRANSACTIONS Under the Listing Rules, the Annual Caps in respect of the Tarumatex Rental Contract and the Annual Caps in respect of the services to be provided under the IKU Consultant Services Contract which relate to the Flour Business are required to be aggregated with the Annual Caps previously announced in respect of the Existing Flour Business Transactions which were announced by the Company in its announcement dated 14 February 2011 for each of the three financial years ending 31 December 2011, 2012 and The increased Annual Caps for the Flour Business, are set out below in this announcement in Table C - Aggregate Annual Caps for the Flour Business Transactions. AGGREGATE ANNUAL CAPS FOR THE VARIOUS CATEGORIES OF BUSINESS TRANSACTIONS Under the Listing Rules, the Annual Caps in respect of the services to be provided under the IKU Consultant Services Contract which relate to various categories of business transactions carried on by the Indofood Group are also required to be aggregated with the Annual Caps previously announced in respect of the relevant categories of business transactions carried on by the Indofood Group for each of the three financial years ending 31 December 2011, 2012 and The increased Annual Caps for the Plantations Business, Packaging Business and Distribution Business are set out below in this announcement in Table D - Aggregate Annual Caps for the various categories of business transactions. LISTING RULES IMPLICATIONS When the Annual Caps of the Tarumatex Rental Contract and the Annual Caps in respect of the services to be provided under the IKU Consultant Services Contract which relate to the Flour Business for each of the three financial years ending 31 December 2011, 2012 and 2013 are aggregated with the Annual Caps of the Existing Flour Business Transactions, one or more of the percentage ratios exceeds 0.1% but none of the percentage ratios exceeds 5%. Accordingly, the Tarumatex Rental Contract, the services to be provided under the IKU Consultant Services Contract which relate to the Flour Business and the Existing Flour Business Transactions, on an aggregated basis, and their aggregated Annual Caps, are subject to the reporting and announcement requirements of Chapter 14A of the Listing Rules, but not the independent shareholders approval requirements. 2 When the Annual Caps in respect of the services to be provided under the IKU Consultant Services Contract which relate to the Plantations Business, Packaging Business and Distribution Business for each of the three financial years ending 31 December 2011, 2012 and 2013 are aggregated with each of the previously announced Annual Caps in respect of the Existing Plantations Business Transactions, Existing Packaging Business Transactions and Existing Distribution Business Transactions, one or more of the percentage ratios exceeds 0.1% but none of the percentage ratios exceeds 5%. Accordingly, the services to be provided under the IKU Consultant Services Contract which relate to the Plantations Business, Packaging Business and Distribution Business, and the Existing Plantations Business Transactions, Existing Packaging Business Transactions and Existing Distribution Business Transactions, on an aggregated basis, and their aggregated Annual Caps, are subject to the reporting and announcement requirements of Chapter 14A of the Listing Rules, but not the independent shareholders approval requirements. VIEWS OF THE DIRECTORS The directors (including the independent non-executive directors) of the Company consider that each of the continuing connected transactions and their related Annual Caps described in this announcement are fair and reasonable and in the interest of the Company and its Shareholders as a whole. INTRODUCTION First Pacific Company Limited ( First Pacific or Company ) announces the entering into of two new continuing connected transactions on 31 October 2011 relating to PT Indofood Sukses Makmur Tbk ( Indofood ) : (i) (ii) a lease agreement between the Bogasari Flour Mills Division ( Bogasari ) of Indofood as lessee and PT Tarumatex ( Tarumatex ) as lessor, relating to the leasing of a part of the warehouse located at Jalan Ahmad Yani Number 806, Bandung 40282, Indonesia (the Premises ) with a building total area of 4,900 square meters including a parking facility and certain furniture and fixtures owned by Tarumatex, for a period from 31 October 2011 to 31 December 2013 (the Tarumatex Rental Contract ); and a consultant services agreement between Indofood and PT Indotek Konsultan Utama ( IKU ), relating to the provision of consultation services by IKU in relation to, amongst others, (a) planning and supervision of the development of production facilities, buildings, warehouse depots, offices and other buildings and infrastructures including roads and canals, and plantation sites; (b) planning and controlling of the maintenance and improvement of the production facilities, buildings, warehouse depots, offices, other buildings and infrastructures including roads and canals; and (c) planning and supervision of the installation of the sea water reverse osmosis systems, for the period from 31 October 2011 to 31 December 2013 (the IKU Consultant Services Contract ) 3 Indofood is a subsidiary of the Company in which the Company indirectly owns an 50.1% interest. Each of the abovementioned continuing connected transactions was between a member of the Indofood Group and an associate of Mr. Anthoni Salim. Mr. Anthoni Salim is both the Chairman of the board of directors of the Company (the Board ), a substantial shareholder of the Company and President Director and CEO of Indofood. Under the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited ( Listing Rules ), the amount of annual caps ( Annual Caps ) in respect of the Tarumatex Rental Contract and the Annual Caps in respect of the services to be provided under the IKU Consultant Services Contract which relate to the flour business carried on by the Indofood Group ( Flour Business ) are required to be aggregated with the Annual Caps previously announced in respect of the continuing connected transaction relating to the Flour Business which were announced by the Company in its announcement dated 14 February 2011 (the Existing Flour Business Transactions ). The Annual Caps applicable to the Tarumatex Rental Contract, the services to be provided under the IKU Consultant Services Contract which relate to the Flour Business and the Existing Flour Business Transactions, (collectively, the Flour Business Transactions ), on an aggregated basis, are set out below in this announcement in the section headed Table C - Aggregate Annual Caps for the Flour Business Transactions Similarly, the Listing Rules require the Annual Caps in respect of the services to be provided under the IKU Consultant Services Contract which relate to the various categories of business transactions carried on by the Indofood Group be aggregated with the previously announced Annual Caps in respect of the continuing connected transactions in the relevant categories of businesses carried on by the Indofood Group, including the following continuing connected transactions: 1. continuing connected transactions in the plantations business carried on by the Indofood Group ( Plantations Business ), the Annual Caps of which were previously announced by the Company in its announcement dated 22 March 2011 ( Existing Plantations Business Transactions, together with the IKU Consultant Services Contract, the Plantations Business Transactions ); 2. continuing connected transactions in the packaging business carried on by the Indofood Group ( Packaging Business ), the Annual Caps of which were previously announced by the Company in its announcement dated 22 March 2011 ( Existing Packaging Business Transactions, together with the IKU Consultant Services Contract, the Packaging Business Transactions ); and 3. continuing connected transactions in the distribution business carried on by the Indofood Group ( Distribution Business ), the Annual Caps of which were previously announced by the Company in its announcement dated 8 November 2010 ( Existing Distribution Business Transactions, together with the IKU Consultant Services Contract, the Distribution Business Transactions ). 4 The Annual Caps applicable to the IKU Consultant Services Contract and the abovementioned categories of businesses transactions carried on by the Indofood Group, on an aggregated basis, are set out below in this announcement in the section headed Table D - Aggregate Annual Caps for the various categories of business transactions. The Company confirms that to date none of the previously announced Annual Caps in respect of the Existing Flour Business Transactions, Existing Plantations Business Transactions, Existing Packaging Business Transactions or Existing Distribution Business Transactions has been exceeded. (1) DETAILS OF THE TARUMATEX RENTAL CONTRACT The rental under the Tarumatex Rental Contract for the first-year period from 31 October 2011 to 30 October 2012 is Rupiah 729,120,000 US$0.1 million or and the rental for the remaining period is to be agreed by the parties with reference to the prevailing market price. The rental in respect of the first-year period from 31 October 2011 to 30 October 2012 is payable by Indofood by way of telegraphic transfer upon signing of the agreement. The rental is payable in cash. The Tarumatex Rental Contract constitutes a continuing connected transaction for the Company under Rule 14A.14 of the Listing Rules because: (i) (ii) Mr. Anthoni Salim is the Chairman of the Board and a substantial shareholder of the Company and President Director and CEO of Indofood; and Tarumatex is wholly owned by the family of Mr. Anthoni Salim and is therefore an associate of Mr. Anthoni Salim under the Listing Rules. The Tarumatex Rental Contract was entered into in order for Indofood to use part of the Premises owned by Tarumatex for the operation of its business activities. The consideration for the Tarumatex Rental Contract was determined with reference to normal commercial terms and on an arm s length basis. The Tarumatex Rental Contract will be conducted in the ordinary and usual course of business of Indofood Group and have been entered into on an arm s length basis and on normal commercial terms. 5 TABLE A ANNUAL CAPS FOR THE TARUMATEX RENTAL CONTRACT The amount of the Annual Caps for the Tarumatex Rental Contract for each of the three financial years ending 31 December 2011, 2012 and 2013, are set out below: Annual Caps For the Year For the Year For the Year Agreement/ Ending Ending Ending Arrangement 31 December December December 2013 Tarumatex Rental Contract US$0.1 million US$0.3 million HK$2.3 million) US$0.3 million HK$2.3 million) The Annual Caps for the Tarumatex Rental Contract is based on the agreed rental fee payable by Indofood to Tarumatex for the first-year period, and on the estimated market rate of rental for the remaining period. (2) DETAILS OF THE IKU CONSULTANT SERVICES CONTRACT The amount of consideration under the IKU Consultant Services Contract to be paid by Indofood to IKU will be determined on a project by project basis, based on the prevailing market rate. The consideration shall be paid by Indofood in cash upon receipt of the report and completion of the bill for the relevant project from IKU. The IKU Consultant Services Contract constitutes a continuing connected transaction for the Company under Rule 14A.14 of the Listing Rules because: (i) Mr. Anthoni Salim is the Chairman of the Board and a substantial shareholder of the Company and President Director and CEO of Indofood; and (ii) IKU is a 52% owned subsidiary of the companies controlled by Mr. Anthoni Salim and is therefore an associate of Mr. Anthoni Salim under the Listing Rules. The IKU Consultant Services Contract was entered into in order for IKU to provide project management services to Indofood Group. The consideration for the IKU Consultant Services Contract will be determined with reference to normal commercial terms and on an arm s length basis. The IKU Consultant Services Contract will be conducted in the ordinary and usual course of business of the Indofood Group and have been entered into on an arm s length basis and on normal commercial terms. 6 TABLE B ANNUAL CAPS FOR THE IKU CONSULTANT SERVICES CONTRACT IN RESPECT OF THE VARIOUS CATEGORIES OF BUSINESS TRANSACTIONS CARRIED ON BY THE INDOFOOD GROUP The IKU Consultant Services Contract involves the provision of services by IKU to the various businesses carried on by the Indofood Group, including the Flour Business, the Plantations Business, the Packaging Business and the Distribution Business. The Annual Caps in respect of the services to be provided under the IKU Consultant Services Contract for each of the three financial years ending 31 December 2011, 2012 and 2013 which relate to the Flour Business, the Plantations Business, the Packaging Business and the Distribution Business, are set out below: Categories of businesses carried on by the Indofood Group For the Year Ending 31 December 2011 Annual Caps For the Year Ending 31 December 2012 For the Year Ending 31 December Flour Business US$0.7 million HK$5.5 million) 2. Plantations Business US$0.1 million 3. Packaging Business US$0.3 million HK$2.3 million) 4. Distribution Business US$0.1 million US$0.9 million HK$7.0 million) US$0.1 million US$0.5 million HK$3.9 million) US$0.1 million US$1.2 million HK$9.4 million) US$0.1 million US$0.5 million HK$3.9 million) US$0.2 million HK$1.6 million) Total Annual Caps in respect of the services to be provided under the IKU Consultant Services Contract which relate to the Flour Business, Plantations Business, Packaging Business and Distribution Business US$1.2 million HK$9.4 million) US$1.6 million HK$12.5 million) US$2.0 million HK$15.6 million) 7 The Annual Caps in respect of the services to be provided under the IKU Consultant Services Contract which relate to the various business transactions carried on by the Indofood Group are determined based on projected activity level for the projects, taking into account factors such as number of staff required and time involved. TABLE C AGGREGATE ANNUAL CAPS FOR THE FLOUR BUSINESS TRANSACTIONS When the Annual Caps for the Tarumatex Rental Contract (as set out in Table A above) and the Annual Caps in respect of the services to be provided under the IKU Consultant Services Contract which relate to the Flour Business (as set out in Table B above) are aggregated with the Annual Caps of the Existing Flour Business Transactions, the Annual Caps for the Flour Business Transactions, for each of the three financial years ending 31 December 2011, 2012 and 2013, will be increased as follows: 31 December 2011 Annual Caps 31 December December 2013 Aggregated Annual Caps for the Flour Business Transactions US$22.4 million HK$174.7 million) US$25.3 million HK$197.3 million) US$28.4 million HK$221.5 million) When the Annual Caps of the Tarumatex Rental Contract and the Annual Caps in respect of the services to be provided under the IKU Consultant Services Contract which relate to the Flour Business for each of the three financial years ending 31 December 2011, 2012 and 2013 are aggregated with the Annual Caps of the Existing Flour Business Transactions, one or more of the percentage ratios exceeds 0.1% but none of the percentage ratios exceeds 5%. Accordingly, the Tarumatex Rental Contract and the services to be provided under the IKU Consultant Services Contract which relate to the Flour Business and the Existing Flour Business Transactions, on an aggregated basis, and their aggregated Annual Caps, are subject to the reporting and announcement requirements of Chapter 14A of the Listing Rules, but not the independent shareholders approval requirements. TABLE D AGGREGATE ANNUAL CAPS FOR THE VARIOUS CATEGORIES OF BUSINESS TRANSACTIONS When the Annual Caps as set out in Table B above for the services to be provided under the IKU Consultant Services Contract which relate to the Plantations Business, Packaging Business and Distribution Business, respectively, are aggregated with the previously announced Annual Caps in respect of the Existing Plantations Business Transactions, Existing Packaging Business Transactions and Existing Distribution Business Transactions, the Annual Caps for the Plantations Business Transactions, Packaging Business Transactions and Distribution Business Transactions, for each of the three financial years ending 31 December 2011, 2012 and 2013, will be increased as follows: 8 Annual Caps Agreement/Categories of business transactions 31 December December December 2013 Aggregated Annual Caps for the Plantations Business Transactions US$36.3 million HK$283.1 million) US$47.8 million HK$372.8 million) US$56.8 million HK$443.0 million) Aggregated Annual Caps for the Packaging Business Transactions US$18.0 million HK$140.4 million) US$23.8 million HK$185.6 million) US$30.4 million HK$237.1 million) Aggregated Annual Caps for the Distribution Business Transactions US$67.3 million HK$524.9 million) US$72.5 million HK$565.5 million) US$78.2 million HK$610.0 million) When the Annual Caps in respect of the services to be provided under the IKU Consultant Services Contract which relate to the Plantations Business, Packaging Business and Distribution Business for each of the three financial years ending 31 December 2011, 2012 and 2013 (as set out in Table B above) are aggregated with each of the previously announced Annual Caps in respect of the Existing Plantations Business Transactions, Existing Packaging Business Transactions and Existing Distribution Business Transactions, one or more of the percentage ratios exceeds 0.1% but none of the percentage ratios exceeds 5%. Accordingly, the services to be provided under the IKU Consultant Services Contract which relate to the Plantations Business, Packaging Business and Distribution Business and the Existing Plantations Business Transactions, Existing Packaging Business Transactions and Existing Distribution Transactions carried on by the Indofood Group, on an aggregated basis, and their aggregated Annual Caps, are subject to the reporting and announcement requirements of Chapter 14A of the Listing Rules, but not the independent shareholders approval requirements. VIEWS OF THE DIRECTORS The directors (including the independent non-executive directors) of the Company consider that the terms of the Tarumatex Rental Contract and the IKU C
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