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814

(1) An issuer which intends to make a rights issue must announce (having regard to Rule 704(25)) the issue promptly, stating the following:—
(a) on the first page, to be presented in the following format:
Principal Terms of the Issue Description
Price  
Discount (specifying benchmarks and periods)  
Allotment Ratio  
Use of Proceeds  
Purpose of Issue  
(b) terms of the issue;
(c) the amount of proceeds proposed to be raised from the issue;
(d) the intended use of such proceeds on a percentage allocation basis (which could be expressed as a range if the exact allocation has not been determined);
(e) where the issue is proposed to be used mainly for general working capital purposes, the issuer must provide reasons for such use taking into account its working capital position;
(f) whether the issuer's directors are of the opinion that, after taking into consideration:
(i) the group's present bank facilities, the working capital available to the group is sufficient to meet its present requirements and if so, the directors must provide reasons for the issue; and
(ii) the group's present bank facilities and the net proceeds of the issue, the working capital available to the group is sufficient to meet its present requirements, unless the directors have opined, pursuant to Rule 814(1)(f)(i) above, that, after taking into consideration the group's present bank facilities, the working capital available to the group is sufficient to meet its present requirements.
"Present requirements" in this Rule 814(1)(f) includes the transaction which will be funded (in whole or in part) by the net proceeds of the issue;
(g) whether the issue will be underwritten;
(h) the financial circumstances which call for the issue;
(i) whether it has obtained or will be seeking the approval of the Exchange for the listing and quotation of the new shares arising from the rights issue;
(j) a statement from the issuer's directors on why the issue is in the interest of the issuer and their basis for forming such views including the factors taken into consideration in arriving at any discount; and
(k) if the issuer undertakes the issue within 12 months from its previous equity fund raising, the following details of each fund raising exercise undertaken in the past 12 months:
(i) description of equity funds raised;
(ii) date of issue of new securities;
(iii) amount raised (both gross and net);
(iv) amount utilised and breakdown on use of proceeds; and
(v) amount not utilised and how it is intended to be used.
The issuer should make a negative statement if there is no such previous equity fund raising.
In addition, an issuer must observe the disclosure requirements in Appendix 8.2.
(2) If a rights issue involves an issue of convertible securities, the issuer must also comply with Part VI of this Chapter.

Amended on 7 February 20207 February 2020.