Chakwal Spinning Mills Limited’s notice of extraordinary General Meeting

Karachi: Notice is hereby given that an Extraordinary General Meeting of shareholders of Chakwal Spinning Mills Limited will be held on, July 02, 2011 at 10:00 a.m. at the premises of Kohinoor Spinning Mills Limited Unit No. 1, Pindi Road, Aminabad, Chakwal to transact the following business.

Ordinary Business:

1. To confirm the minutes of the Extraordinary General Meeting held on April 08, 2011.

Special Business

1. To consider and approve fifty percent (50%) reduction in the paid up Share Capital of the Company and to amend the Memorandum and Articles of Association of the Company by passing the following special resolution ,with or without modification:

“Resolved that the paid up capital of the Company be and is hereby reduced (subject to the requirements of the Companies Ordinance, 1984) by canceling the issued and paid up capital of the Company which has been lost or is unrepresented by its available assets to the extent of fifty percent (50%), that is Rs.5/= (Rupees five) on each of the Issued shares of the Company and reducing the nominal value thereof to Rs.5/= (Rupees five) each.

Further Resolved that the figures and words “Rs.400, 000,000 (Rupees Four hundred million) divided into 40,000,000 (Forty million) ordinary shares of Rs.10/= each”, appearing in Clause V of the Memorandum of Association of the Company be and are hereby substituted by the figures and words “Rs. 200,000,000 (Rupees Two hundred million) divided into 40,000,000 (Forty million) ordinary shares of Rs.5/= (Rupees five) each”.

Further Resolved that the figures and words “Rs.400, 000,000 (Rupees Four hundred million) divided into. 40,000,000 (Forty million) ordinary shares of Rs10/= each” appearing in Article 5 of the Articles of Association of the Company be and are hereby substituted by the figures and words “Rs. 200,000,000 (Rupees Two hundred million) divided into 40,000,000 (Forty million) ordinary shares of Rs.5/ = (Rupees five) each”.

Further Resolved that Khawaja Mahammad Kaleem, Director and Mr. Muhammad Jahangir Khan Company Secretary of the Company (the “Authorized Officers”) be and are hereby authorized by and on behalf of the Company to singly do all acts, deeds and things and to take all necessary steps to complete all legal formalities, to file all necessary documents and to appear before all relevant authorities, including the Court, the Securities and Exchange Commission of Pakistan, Stock Exchanges or any other competent body and/or authority in connection with the reduction of capital of the Company.

The Authorized officers are further authorized to file a petition before the Court seeking confirmation of the special resolution passed for reduction of the shore capital and to take all steps facilitating the said confirmation.

The Authorized Officers shall have the power to consent on behalf of all concerned to any modifications or additions to the subject resolution(s) or to any conditions, which the Court may think, fit to impose. The Authorized Officers are further authorized to issue letters, sign documents and to do all other incidental acts, deeds and things as may be considered appropriate by him in his better judgment in order to achieve the objectives of this resolution, including engagement of legal counsel for the purposes of representing the Company before all relevant authorities, including the Court, Securities and Exchange Commission of Pakistan and/or any other competent body and/or authority and to take all further actions in this regard as may be prescribed by the Court or otherwise”.

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

Notes:

1. The share transfer books of the Company will remain closed from June 25, 2011 to July 02, 2011 (both days inclusive).

2. A member entitled to attend the meeting may appoint another member as his/her proxy to attend the meeting of him/her behalf. Proxies in order to be effective must be received by the Company not later than 48 hours before the meeting.

3. The beneficial owner of the shares of the company in the central depository system of the CDC or his/her proxy entitled to attend this meeting shall produce his/her original CNIC or passport to prove the identity. CDC Account Holders will further have to follow the guidelines as laid down in Circular No. 1 dated 26 January 2000 Issued by the Securities and Exchange Commission of Pakistan.

4. Shareholders are requested to immediately notify the change in their address, if any, and also send copy of CNIC as pursuant to the amendments made in clause (9), Table A, First Schedule and format of Form-A provided in Third Schedule of the Companies Ordinance, 1984, (the Ordinance”) vide S.R.O. 286 (1) 2005 dated March 31, 2005, it was made mandatory to provide CNIC number of every transferor and the witness for transfer of shares and CNIC number of every director, member and debenture holder for filing annual return of company having shareholdings to our share registrar M/s Corplink (Pvt.) Limited, Wings Arcade, 1-K, Commercial, Model Town, Lahore. Tel. 042-5839182.

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

The Board of Directors of the Company in their meeting held on June 10, 2011 considered and recommended the 50% reduction in Share Capital of the Company u/s 96 of the Companies Ordinance, 1984 due to the following material fact:

The Company has been incurring continuous losses and the accumulated losses of the Company stood at Rs.240.483 millions as per statement for the year ended June 30 2010. Since, there are no reserves to cover such accumulated losses, the paid up share capital of the Company is lost and not fully represented by available assets of the Company. Hence the above special resolutions for reduction of paid up share capital of the Company under section 96 of the Companies Ordinance, 1984 are proposed by the Directors to enable the Company to approach all the relevant department and Honorable Lahore High Court, Lahore for its confirmation.

The directors of the Company have no indirect interest in the special business and their interests are the same as the interests of the other shareholders.

For more information, contact:
Muhammad Jahangir Khan
Corporate Secretary
Chakwal Spinning Mills Limited
31-F, Main Market Gulberg II,
Lahore – Pakistan.
Tel: +9242 35755774
Fax: +9242 35755760

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