STRICTLY CONFIDENTIAL
DRAFT as of December 2013
[ Sample of Form ]
MODEL PROSPECTUS
ABC COMPANY LIMITED
(This document is made solely for discussion purposes)
STRICTLY CONFIDENTIAL
DRAFT as of December 2013
To: Director General of Directorate of Investment & Company Administration,
Ministry of National Planning & Economic Development,
Republic of the Union of Myanmar
Date of Filing : [________________, 2014]
Company Name : ABC Company Limited
Company Registration No. : [ ]
Date of Incorporation : [ ]
Title and Name of Representative : [Chairman, Managing Director or Director]
[Name of the Representative]
Location of the Registered Office : [________________,
Republic of the Union of Myanmar]
Place to Contact : [ ]
Telephone : [ ]
Listing : [Yangon Stock Exchange or Not Applicable]
This is to certify that this prospectus shall comply with all the requirements under the
Myanmar Companies Act.
STRICTLY CONFIDENTIAL
DRAFT as of December 2013
TABLE OF CONTENTS
Page
PART I. COMPANY INFORMATION ............................................................... 1
I. Outline of the Company ............................................................................
1. History / Background of the Company ...............................................
2. Organizational Structure of the Company and its Group ...................
3. Outline of Parent, Subsidiaries and Associated Companies ...............
4. Conditions of Employees ....................................................................
II. Description of Business ............................................................................
1. Nature of Business ..............................................................................
2. Outline of Each Business Segment .....................................................
3. Sales and Marketing ............................................................................
4. Competition .........................................................................................
5. Material Contracts ...............................................................................
6. Property, Plant and Equipment ...........................................................
7. Research and Development .................................................................
8. Other Related Business .......................................................................
PART II. INFORMATION ON THE COMPANYS MANAGEMENT AND
SHAREHOLDERS ....................................................................................
I. Board of Directors and Directors ..............................................................
II. Senior Management ..................................................................................
III. Remuneration / Compensation of Senior Management ............................
IV. Corporate Governance ..............................................................................
V. Shareholders ..............................................................................................
VI. Dividends, Dividend Policy and Stock Options .......................................
VII. Description of the Companys Shares ......................................................
PART III. RELATED PARTY TRANSACTIONS ................................................
I. Material Transactions / Agreements with Major Shareholders ................
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II. Material Transactions / Agreements with Senior Management ................
III. Other Conflicts of Interests .......................................................................
PART IV. FINANCIAL INFORMATION .............................................................
I. Financial Statements with Notes ...............................................................
II. Auditors Report .......................................................................................
III. Legal Proceedings / Litigations ................................................................
PART V. OTHER INFORMATION .....................................................................
I. Signature of Chairman, Managing Director and Director ........................
II. Identity of Directors, Senior Management, Corporate Secretary, Auditors and
Advisors .....................................................................................................
III. Others .......................................................................................................
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STRICTLY CONFIDENTIAL
DRAFT as of December 2013
PART I. COMPANY INFORMATION
I. Outline of the Company
1. History / Background of the Company
The Company was incorporated as a public company on [ ] under the laws of
Myanmar, having its registered address at [ ], Yangon, Myanmar. The incorporation of the
Company was initiated by its group company in connection with the restructuring of the
group business by transferring certain assets associated with the company business lines,
according to the resolutions of board of directors and shareholders meetings.
The following information shall be provided:
1. The legal and commercial name and website address of the company
2. The date of incorporation and the length of life of the company, etc.
3. The domicile and legal form of the company, the legislation under
which the company operates, its country of incorporation and the
address and phone number of its registered office. (Provide the name
and address of the companys agents in each of the countries in which
the shares will be offered, if any.)
4. The length of time for which the business of the company or its group
has been carried on and the important events in the development of the
companys business, i.e. information concerning the nature and results
of any material reclassification, merger or consolidation of the
company or any of its significant subsidiaries; acquisitions or
dispositions of material assets other than in the ordinary course of
business; any material changes in the mode of conduction the
business; material changes in the types of products produced or
services rendered; name changes; or the nature and results of any
bankruptcy, receivership or similar proceedings with respect to the
company or significant subsidiaries.
5. A description of the companys material capital expenditures and
divestitures, since the beginning of the companys last two financial
years to the date of the Prospectus.
6. Information concerning the material capital expenditures and
divestitures currently in progress, including the distribution of these
investments geographically and the method of financing.
2. Organizational Structure of the Company and its Group
Provide the companys structure by showing intra/inter-companies trees in the
diagrams. If the company is part of a group, include a brief description of the group and the
companys position within the group.
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3. Outline of Parent, Subsidiaries and Associated Companies
Provide information on each of the companys subsidiaries and associated companies
which account for 10% or more of the absolute amount of the net assets, net liabilities or
profit or loss before tax, respectively, of the group for any of the two most recent financial
years, including its name, country of incorporation or residence, principal place of business,
principal activities and proportion of ownership interest.
4. Conditions of Employees
Disclose the information on the latest companys employees, such as number of
employees, categories of employees and age of employees, etc.
As at the end of the latest financial year, there were [ ] employees consisting of:
- Full time employees: [ ]
- Part time employees: [ ]
- Contract employees: [ ]
Provide the table of the professional qualification and age of the employees as at the
latest account closing date, if applicable.
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II. Description of Business
1. Nature of Business
The information required by this section may be presented on the same basis as that
used to determine the companys business segments under the body of accounting principles
used in preparing the financial statements. The following information shall be provided:
- A description of the nature of the companys operations and its principal
activities, stating the main categories of products sold and/or services performed
for each of the last two financial years. Indicate any significant new products
and/or services that have been introduced between the beginning of the period
comprising the two most recent completed financial years and the latest
practicable date and, to the extent the development of new products or services
has been publicly disclosed, give the status of development.
- A description f the seasonality of the companys main business.
- A description of the sources and availability of raw materials, including a
description of whether prices of principal raw materials are volatile.
- Summary information regarding the extent to which the company is dependent, if
at all, on patents or licenses, industrial, commercial or financial contracts
(including contracts with customers or suppliers) or new manufacturing
processes, where such factors are material to the companys business or
profitability.
- A description of the material effects of government regulations on the companys
business, identifying the regulatory body.
2. Outline of Each Business Segment
Provide the segment information for each of the business lines with respect to the
products, services, activities, locations by sector, division or department.
3. Sales and Marketing
State a description of the marketing channels used by the company, including an
explanation of any special sales methods, such as installment sales.
4. Competition
Provide a description of the principal markets in which the company competes,
including a breakdown of total revenues by category of activity and geographic market for
each of the last two financial years.
Also describe the basis for any statements made by the company regarding its
competitive position shall be disclosed.
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5. Material Contracts
Provide a summary of each material contract, other than contracts entered into in the
ordinary course of business, to which the company or any member of the group is a party, for
the two years immediately preceding the date of the Prospectus, including dates, parties,
general nature of the contracts, terms and conditions, and amount of any consideration
passing to or from the company or any other member of the group.
6. Property, Plant and Equipment
Provide information regarding any material tangible fixed assets, including leased
properties, and any major encumbrances thereon, including a description of the size and uses
of the property; productive capacity and extent of utilization of the companys facilities for
each of the last two financial years; how the assets are held; the products produced; and the
location.
Describe any regulatory requirements and environmental issues that may materially
affect the companys utilization of the assets. With regard to any material plans to construct,
expand or improve facilities, describe the nature of and reason for the plan, an estimate of the
amount of expenditures including the amount of expenditures already paid, a description of
the method of financing the activity, the estimated dates of start and completion of the
activity, and the increase of production capacity anticipated after completion.
7. Research and Development
Provide a description of the companys research and development policies for the last
two financial years, where it is significant, including the amount spent during each of the last
two financial years on company-sponsored research and development activities.
8. Other Related Business
Describe any relevant information on other business lines relating to environmental
and social impact issues, if applicable.
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DRAFT as of December 2013
PART II. INFORMATION ON THE COMPANYS MANAGEMENT AND
SHAREHOLDERS
I. Board of Directors and Directors
The following table sets out the short biography of directors specifying their identity
and qualifications.
Representativ Date/Place
Name Title Gender Nationality Education
e of Institution of Birth
Other than specified in the company act, the board of directors of the company has
responsibility for the administrative affairs of the company and has specific responsibilities
as follows:
- to consider the companys strategy, as well as implementation plan of the
company;
- to consider and determine the remunerations and compensation of the chief
executive officer and top management;
- to consider and determine the capital, its usage, its structure, the ratio of the
capital and loan, as well as loan agreements, credit facility agreements, joint
venture agreements, electricity sale and purchase agreement and other agreements
with high value;
- to propose an external auditor;
- to consider the appointment or removal of an agent to be in the board of directors
of the joint venture company, if any;
- to adopt the appointment or removal of the accounting department manager and
the manager of internal audits office as proposed by the chief executive officer;
and
- to propose the remunerations of the external auditor.
[The board of directors dose not involve in the day-to-day operations of the company
unless any of the directors is appointed as the management.]
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II. Senior Management
The senior management is appointed by the board of directors. In the appointment of
each position of the management team, the qualifications of the candidates are considered
whether they are suitable to each position.
The following table sets forth the short bio of the senior management of the company.
Date/Place of
Name Title Gender Nationality Education
Birth
III. Remuneration / Compensation of Senior Management
The following table sets out the remuneration or compensation of the management.
Aggregate Amount (Salary and
Name Position Compensation) (thousand in Kyat)
2013 2014
IV. Corporate Governance
The following committees have been established under the board of directors: an
audit committee, a nomination and remuneration committee, a strategy and investment
committee and a risk management committee. Each of the committees operates in accordance
with terms and standards established by the board of directors.
- Audit Committee
The company has established an audit committee with the terms and standards in
compliance with the corporate governance code of the listing rules. The primary
duties of the audit committee include, but are not limited to, the following:
(i) review the companys material financial and accounting policies and practices and
their implementation, supervise its financial operation status;
(ii) evaluate audit controllers performance and make recommendations to the board;
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(iii) review the companys fundamental internal audit system and make
recommendations to the board, approve the annual audit plan and budget, direct the
internal audit process and monitor its effectiveness;
(iv) review annually the soundness and effectiveness of its internal control system,
promptly consider and process any major complaints;
(v) coordinate between the internal and external auditor, supervise the improvement
and implementation of any significant findings arising out of the internal and external
audit;
(vi) make recommendations to the board on the appointment, removal, and
remuneration of the external auditor, supervise the external auditors independence
and objectivity, and the effectiveness of the audit process in accordance with
applicable standards;
(vii) ensure that the board will provide a timely response to the issues raised in the
external auditors management letter;
(viii) review the annual audit report prepared by the external auditor and other
professional recommendations;
(ix) perform an initial assessment on any related transactions that are to be approved
at a shareholders meeting and board meeting and submit it to the board for approval;
(x) review and approve or accept filings of related transaction as authorized by the
board; and
(xi) perform other duties as required by applicable laws, regulations, or other matters
authorized by the board.
- Nomination and Remuneration Committee
The company has established an audit committee with the terms and standards in
compliance with the corporate governance code of the listing rules. The primary
duties of the nomination and remuneration committee include, but are not limited to,
the following:
(i) study the selection standards and procedures for the directors and senior
management hired by the board, review at least annually the structure, size and
composition of the board and make recommendations on any proposed changes to the
board to complement the corporate strategy;
(ii) broadly search for qualified individuals as candidates suitably to become the
director and senior management;
(iii) review and approve the remuneration proposals of directors and senior
management hired by the board with reference to the boards corporate goals and
objectives; and
(iv) make independent and prudent suggestions relating to the dismissal or removal of
directors.
- Strategy and Investment Committee
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The company has established an audit committee with the terms and standards in
compliance with the corporate governance code of the listing rules. The primary
duties of the strategy and investment committee include, but are not limited to, the
following:
(i) review and make proposals on the general development strategy and specific
strategic development plans, and make recommendations to the board;
(ii) evaluate factors that may have an impact on the strategic development plans and
its implementation in light of domestic and international economic financial
conditions and market changes and make prompt strategic adjustment
recommendations to the board;
(iii) review the annual financial budget and final accounts plans, and make
recommendations to the board;
(iv) review the external investment proposals and explain them at shareholders and
board meetings upon their request;
(v) develop and revise policies related to the corporate governance, and make
recommendations to the board;
(vi) supervise the directors and senior managements training and continuing
professional development;
(vii) develop, amend and supervise the internal code of conduct for the directors and
employees; and
(viii) supervise the disclosure on corporate governance in compliance with the
relevant rules and regulations of the stock exchange on which the companys shares
are listed.
- Risk Management Committee
The company has established an audit committee with the terms and standards in
compliance with the corporate governance code of the listing rules. The primary
duties of the risk management committee include, but are not limited to, the
following:
(i) be responsible for the risk management, be completely familiar with the significant
risks and the corresponding management status, supervise the operational
effectiveness of the risk management controls;
(ii) review the overall goals, fundamental policies and procedures for risk
management, and make suggestions and recommendations to the board;
(iii) review and approve the risk management organization and corresponding
responsibilities, and make suggestions and recommendations to the board;
(iv) review the annual risk assessment report and make suggestions and
recommendations to the board;
(v) review and submit the annual compliance report to the board; and
(vi) develop and amend the internal compliance code applicable to the employees and
directors, assess and supervise the compliance policies and status, and make
recommendations to the board.
V. Shareholders
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The following table sets out the general information on the major shareholders of the
company [as of the data of this Prospectus].
Name Address Quantity Percentage of
Ownership
VI. Dividends, Dividend Policy and Stock Options
1. Dividend Policy
The Company will pay dividends, if any, only out of its profits, and subject to its cash
flow, as permitted under the Myanmar law. The expected dividend payout ratio is [50]% of
the Companys net profit before tax for the respective financial years. Dividends will be paid
in Myanmar Kyat.
The board of directors of the Company has the discretion to recommend the payment
of dividends. The Company cannot assure the investors that the Company will declare or pay
out any dividends.
2. Stock Options
The company has not granted any stock options to its directors and employees.
VII. Description of the Companys Shares
Set out here is certain general information relating to the shares of the company,
including brief summaries of certain provision of its contract of incorporation and the articles
of association, the company act and the relevant rules/regulations, all as currently in effect.
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PART III. RELATED PARTY TRANSACTIONS
Provide the information required below for the period since the beginning of the
companys preceding two/three financial years up to the date of the Prospectus, with respect
to transactions or loans between the company and its related parties.
Describe the nature and extent of any transactions or presently proposed transactions
which are material to the company or the related party, or any transactions that are unusual in
their nature or conditions, involving goods, services, or tangible or intangible assets, to which
the company or any of its parent or subsidiaries was a party.
I. Material Transactions / Agreements with Major Shareholders
Disclose the transactions with shareholders holding at least 5% of the outstanding
shares, indicating name, type and date of transactions, during the last two/three years prior to
the filing of application.
II. Material Transactions / Agreements with Senior Management
Provide the material transactions with directors or senior officers or persons whereby
directors or senior officers of the company has interest during the last two/three years prior to
the filing of application.
Also disclose material transactions with family members of directors or senior
officers or shareholders holding at least 5% of the outstanding shares during the last
two/three years.
Further present material transactions with persons who have relationship with
directors of the company, its subsidiary or holding company where relationship occurred in
the transaction or any arrangement with the company during the last two/three years.
Describe the material transactions with directors receiving any interest or professional
fee for services in which the director provided via any firm to the company during the last
two/three years.
III. Other Conflicts of Interests
Where a director or significant person of the company or associates has an interest in
any entity carrying on the same business or dealing in similar products as the company or the
group, disclose:
- Name of the entity;
- Name of the director or significant person involved;
- Nature and extent of his/her interest in that entity and the extent to which he/she
is involved in the management of that entity either directly or indirectly; or
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- Whether any conflict of interests thereby arising has been or is to be resolved or
mitigated and, if so, how it has been or is proposed to be resolved or mitigated.
If any of the named experts, counselors, underwriter or other financial adviser was
employed on a contingent basis, owns an amount of shares in the company or its subsidiaries
which is material to that person, has a material, direct or indirect economic interest in the
company or that depends on the success of the offering, or otherwise has a material
relationship with the company, provide a brief description of the nature and terms of such
contingency, interest or relationship.
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DRAFT as of December 2013
PART IV. FINANCIAL INFORMATION
I. Financial Statements with Notes
Attach the audited financial statements.
1. The Prospectus must contain comparative consolidated financial statements of the
company, or if the company is a holding company, of the group, that cover the latest
two financial years (or such shorter period that the company has been in operation).
2. If the registration/effective date of the Prospectus is more than six months after the
end of the most recent completed financial year for which financial statements is
provided above, the Prospectus must contain interim financial statements of the
company, or if the company is a holding company, of the group, made up to a date
that is not earlier than six months before the registration/effective date of the
Prospectus. The Prospectus must also include comparative interim financial
statements (other than a statement of financial position) for the corresponding period
in the previous financial year.
3. The financial statements to be provided under paragraph 1 and 2 of this section must
be:
- prepared in accordance with the Myanmar Financial Reporting Standards and/or
any other accounting principles accepted in Myanmar; and
- other than the comparative interim financial statements, if any, which need not be
audited, the financial statements are to be audited in accordance with the
Myanmar Auditing Standards and/or any other accounting principles accepted in
Myanmar.
4. The financial statements to be provided under paragraph 1 and 2 of this section shall
comprise such items as required by the accounting principles.
II. Auditors Report
Describe or attach here the whole auditors report on the companys financial
statements.
III. Legal Proceedings / Litigations
Provide information on any legal or arbitration proceedings, including those relating
to bankruptcy, receivership or similar proceedings which may have, or have had in the 12
months immediately preceding the date of the Prospectus, significant effects on the
companys financial position or profitability. This includes governmental proceedings
pending or known to be contemplated.
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PART V. OTHER INFORMATION
I. Signature of Chairman, Managing Director and Director
Provide the signatures of chairman, managing director and/or director of the company
certifying that the entire information contained herein the Prospectus is accurate and
complete.
II. Status of Directors, Senior Management, Corporate Secretary, Auditors and
Advisors
Provide the identification, sign-offs, consents or statements, if applicable, of the
companys management and the relevant experts, including, but not limited to, independent
auditor, legal adviser, tax adviser and consultants, contributing to the preparation of this
Prospectus.
III. Others
Provide any other relevant matters in relation to the execution or documentation of
the share offering, such as the certain provisions of the Companys memorandum and articles
of association under the Myanmar Companies Act. Otherwise, simply put not applicable in
here.
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