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Liberty Mills Limited’s notice of extraordinary general meeting

Karachi: Notice is hereby given that an Extraordinary General Meeting of the Members of Liberty Mills Limited (LIBM) will be held on Saturday, December 24, 2011 at 11:00 a.m. at the Registered Office of the Company situated at A/51-A, S.I.T.E. Karachi, to transact the following business.

Ordinary Business:

To confirm the minutes of 45th Annual General Meeting held on October 29, 2011.

Special Business:

2. To consider and approve the Advance/Guarantee to subsidiary company “Liberty Power Tech Limited” to the tune of PRK 1.5 Billion or issue counter guarantee for any such loan provided by any lending bank(s) or financial institutions or NBPC, and if thought fit to pass with or without modification the following resolutions as special resolution.

“Resolved that the Company be and is hereby empowered to make Advance to its subsidiary Company namely Liberty Power Tech Limited to the tune of PKR 1.5 billion or issue counter guarantee for any such loan provided by any lending bank(s) or financial institutions or NBFC in order to meet any urgent working capital requirements at (Three months KIBOR + 2%) i.e. 1% spread over average interest rate which is not less than the average borrowing cost of the Company and the amounts will be repayable within three years from date of disbursement

Further Resolved that the Chief Executive of the Company and/or any of the Directors of the Company be and are hereby authorized to complete the legal formalities and acts in respect of the above advance / guarantee as is necessary on behalf of the Company.

A statement under section 160 of the Companies Ordinance 1984 pertaining to the Special Business is being sent to all the Members along-with this Notice.

Notes:

The Members Register will remain closed from December 17, 2011 to December 24, 2011 (both days inclusive).

ii. A member eligible to attend and vote at the meeting may appoint another member as proxy to attend and vote in the meeting. Proxies in order to be effective must be received by the Company at the Registered Office not later than 48 hours before the time for holding the meeting.

CDC Notes:

A. For Attending the Meeting:

1. In case of individuals, the account holder or sub-account holder and/or the person whose securities are in group account and their registration details are uploaded as per the Regulation, shall authenticate his identity by showing his original Computerized National Identity Card (CNIC) or original passport at the time of attending the meeting.

ii. In ease of corporate entity, the Board of Directors’ resolution / power of attorney with specimen signature of the nominee shall be produced (Unless it has been provided earlier) at the time of the meeting.

B. For Appointing Proxies:

i. In case of individuals, the account holder or sub-account holder and / or the person whose securities are in group account and their registration details are uploaded as per the Regulation, Shall submit the proxy form as per above requirements.

ii. The proxy form shall be witnessed by two persons whose names, addresses and CNIC numbers shall be mentioned on the form.

iii. Attested copy of CNIC or Passport of the beneficial owner and the proxy shall be furnish with the proxy form.

iv. The proxy shall produce his original CNIC or Original Passport at the time of meeting.

v. In ease of corporate entity. The Board of Directors’ Resolution / power of attorney with specimen signature of the nominee shall be submitted (unless it has been provided earlier) along with proxy form to the Company.

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

Liberty Power Tech Limited (LPTL) a subsidiary of’ the Company, was incorporated on September 13, 2007 as Public limited company (un-listed) for setting up and operate 195 Mega Watt electricity generating project. The proposed power plant will be a thermal IPP using Residual Fuel Oil as fuel.

Mr. Muhammad Salim Mukaty, the Chairman, Mr. Muhammad Ashraf Mukaty S/o Muhammad Salim Mukaty, the Chief! Executive and Mr. Yusuf N. Mukaty the Director of Liberty Mills Limited respectively holds the position of Chairman of the Board of Directors, Chief Executive of and Director of LPTL whereas two daughters and spouse of the Chairman and the spouse of Chief Executive are also directors in LPTL. These persons are interested as members of the Company and are also interested as 50.26% shareholders in the LPTL. The present share capital of LPTL amounts to PKR. 5.046 Billion.

Liberty Mills Limited Holds 144.7 million shares of PKR 10 each in LPTL.

The LPTL had achieved its Commercial operation date on January 12, 2011 and carrying the operation successfully and had supplying electricity to NTDC. The utilization of the plant is around 93% of the dependable capacity. Due to the effects of circular debt the pace of recovery of receivables from NTDC are very slow and the Subsidiary Company requires funds to sort out their short term funding requirements.

The Salient features as required by the S.R.O. 865(I)/ 2000 are narrated herein below:

Special Resolution regarding loan to the Subsidiary

i. Name of company or associated undertaking:

Liberty Power Tech Limited

ii. Nature, amount and extent of Loan

Short term loan or Guarantee to lending banks for providing short term loan to Subsidiary Company LPTL to the time of PKR 1.5 Billion.

iii. Source of Funds of Investment

The funds will be invested out of Short term Borrowings of’ the Company. On September 30, 2011 the Company had unutilized/unavailed credit facilities of PKR 828.785 million of Short term borrowings and had Fixed Assets which are not charged with any borrowers of Long term and short term finances equivalent to PKR 2.098.208 million as per valuation carried out in 2008.

iv. Period for which investment will be made

The period of the loan is short term repayable in full within three years.

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

The whole scheme of Financing to subsidiary company will generate markup equals to 1% over and above the company’s borrowing cost.

vi. Interest of the directors and their relatives in the investee company

None of the directors or their relative or associates are interested in any of above resolutions in any way except as members of the Company.

Special Resolution regarding Guarantee to the Subsidiary

i. Name of company or associated undertaking:

Liberty Power Tech Limited

ii. Nature, amount and extent of Loan

As stated above in (ii) under the caption special resolution regarding loan to the Subsidiary.

iii. Source of Funds of Investment

Lien marking of short term financing limits available or charge over Fixed assets. On September 30, 2011 the Company had unutilized/unavailed credit facilities of PKR 828.385 million of Short term borrowings and had Fixed Assets which are not charged with any borrowers of Long term and short term finances equivalent to PKR 2,098.208 million as per valuation carried out in 2008.

iv. Period for which investment will be made

The period, of the loan is short term repayable in full within three years.

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

The whole scheme of Financing to subsidiary company will generate markup equals to 1% over and above the company’s cost.

vi. Interest of the directors and their relatives in the investee company

None of the directors or their relative or associates are interested in any of above resolutions in any way except as members of the Company.

For more information, contact:
Muhammad Iqbal Haroon
Company Secretary
Liberty Mills Limited
Mills: A/51 – A, S.I.T.E.,
Karachi – 75700 (Pakistan)
Tel: 92-21-32578100 (17 Lines)
Fax: (92-21) 32561050
E-Mail: liberty@libertymillslimited.com
Web: www.libertyrnlilslirnited.com

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