Seymour Whyte Limited ACN 105 493 203 ASX Announcement 26 June 2017 SEYMOUR WHYTE ANNOUNCES RECOMMENDED SCHEME WITH VINCI AT A$1.285 CASH PER SHARE Summary • Proposed acquisition by VINCI Construction International Network (‘VINCI’) of all the issued ordinary shares in Seymour Whyte Limited (‘Seymour Whyte’ or ‘the Company’) for a total consideration of A$1.285 cash per share to be implemented by a scheme of arrangement (‘Scheme’). • Seymour Whyte may decide to pay one or more fully franked dividends up to a maximum total of A$0.445 per share (collectively referred to as the ‘Scheme Dividend’). If so, the cash consideration as part of the Scheme will be reduced by the cash amount of any Scheme Dividend. Shareholders who are able to capture the full benefit of the franking credits associated with any Scheme Dividend may realise an additional value of A$0.19 per share if the maximum Scheme Dividend is paid. • The scheme consideration represents a premium of 40% to Seymour Whyte’s volume weighted average share price of A$0.92 in the three months up to and including 14 March 2017 (the last day of trading before Seymour Whyte announced it had received an indicative proposal from VINCI). • The Board of Seymour Whyte considers that the Scheme is in the best interests of the Company’s shareholders, and unanimously recommends that shareholders vote in favour of the Scheme in the absence of a superior proposal and subject to an independent expert concluding (and continuing to conclude) that the Scheme is in the best interests of the shareholders. Each Director intends to vote all their shares in favour of the proposed Scheme, in absence of a superior proposal and subject to an independent expert concluding (and continuing to conclude) that the Scheme is in the best interests of Seymour Whyte shareholders. • Major shareholders controlling approximately 48% of the ordinary shares in Seymour Whyte have stated that they intend to vote in favour of the Scheme, in absence of a superior proposal and subject to an independent expert concluding (and continuing to conclude) that the Scheme is in the best interests of Seymour Whyte shareholders. Seymour Whyte Limited (ASX:SWL) (‘Seymour Whyte’ or ‘the Company’) announces that it has entered into a Scheme Implementation Agreement (‘SIA’) with VINCI Construction International Network (‘VINCI’) under which it is proposed that VINCI (or its nominee) will acquire 100% of the issued ordinary shares in Seymour Whyte to be implemented by a scheme of arrangement (‘Scheme’). If the Scheme is approved by the requisite majorities of Seymour Whyte shareholders and becomes effective, Seymour Whyte shareholders will receive a total consideration of A$1.285 in cash per share (‘Scheme Consideration’). Seymour Whyte has retained the discretion to pay one or more special dividends of up to a total of A$0.445 per share (which will be deducted from the Scheme Consideration) on or before the implementation date of the Scheme. Further details of the potential dividends are set out below. 1 of 4 The Scheme Consideration implies an equity value for Seymour Whyte of approximately A$113 million.1 The Board of Seymour Whyte considers that the Scheme is in the best interests of the Company’s shareholders and unanimously recommends that shareholders vote in favour of the Scheme, in the absence of a superior proposal and subject to the independent expert concluding (and continuing to conclude) that the Scheme is in the best interests of Seymour Whyte shareholders. Each Director intends to vote all their shares in favour of the proposed Scheme, in the absence of a superior proposal and subject to an independent expert concluding (and continuing to conclude) that the Scheme is in the best interests of Seymour Whyte shareholders. Seymour Whyte Chairman Mr Mac Drysdale said, “The Scheme provides the certainty of a cash return to Seymour Whyte shareholders and represents clear and attractive value for the Company. The support of VINCI and its Australian operations is expected to significantly enhance Seymour Whyte’s competitive positioning and create greater opportunities for our staff and customers. The Board of Seymour Whyte believes that in the context of the current operating environment and competitive landscape, this agreement with VINCI will provide the scale and financial capacity to successfully pursue larger, significant opportunities in the market. “VINCI has a strong appreciation for the Seymour Whyte brand and legacy, and as a reflection of this, has committed to retaining and preserving the identity and operations of the Company. “In addition, upon completion of the proposed Scheme, VINCI has indicated their intention that the existing senior management team, led by John Kirkwood, will remain in place to continue to drive the performance and growth of the Company.” Seymour Whyte shareholders Racelid Pty Ltd (Estate of Garry Whyte), Rabtuvi Pty Ltd (John Seymour) and Robert Carr (collectively the ‘Major Shareholders’) have each separately advised Seymour Whyte that they intend to vote all Seymour Whyte shares held or controlled by them respectively (in total representing approximately 48% of the Seymour Whyte shares on issue), in favour of the Scheme in absence of a superior proposal and subject to an independent expert concluding (and continuing to conclude) that the Scheme is in the best interests of Seymour Whyte shareholders.2 The Major Shareholders have authorised Seymour Whyte to announce their intentions. Potential Scheme Dividend The SIA permits Seymour Whyte to pay one or more fully franked dividends up to a maximum total of A$0.445 per share (collectively referred to as the ‘Scheme Dividend’). The cash consideration as part of the Scheme will be reduced by the cash amount of any Scheme Dividends. The payment of any Scheme Dividend is subject to the discretion of the Board and the franking credit position of Seymour Whyte. The Company will update the market after a final decision is made as to whether a Scheme Dividend will be paid and, if so, the details of the Scheme Dividend. 1 At the date of this announcement, Seymour Whyte had 87,976,230 ordinary shares on issue. 2 Garry Whyte and John Seymour founded Seymour Whyte Constructions in 1987. Racelid Pty Ltd and Rabtuvi Pty Ltd hold 22.6% and 19.5% of issued ordinary shares in Seymour Whyte respectively. Robert Carr is a Director of Seymour Whyte and holds 5.6%. 2 of 4 If a Scheme Dividend is paid, shareholders may be entitled to receive the benefit of any franking credits attached to the Scheme Dividend. Those shareholders who can capture the full benefit of the franking credits associated with the maximum Scheme Dividend may receive an additional benefit valued at up to A$0.19 per share. If the Scheme Dividend is less, or is not paid, any additional benefit arising from the receipt of the franking credits will be less. As part of payment of the Scheme Dividend, Seymour Whyte will seek a Class Ruling from the Australian Taxation Office to confirm the tax outcomes for shareholders who receive a Scheme Dividend and dispose of their shares under the Scheme, including eligibility to imputation benefits on the Scheme Dividend and the tax treatment of capital proceeds received under the Scheme. The tax implications of the Scheme for each shareholder will depend on their respective circumstances. Accordingly, all shareholders are encouraged to seek professional advice in relation to their tax position. Neither Seymour Whyte nor any of its officers, employees or advisors assumes any liability or responsibility for advising shareholders about the tax consequences of the Scheme. Scheme Implementation Agreement The Scheme is intended to be effected by way of a scheme of arrangement under Part 5.1 of the Corporations Act 2001 (Cth) and is conditional on, among other things: • relevant ASIC and ASX approvals • the approval of Seymour Whyte shareholders and the Federal Court • no Material Adverse Change or Prescribed Occurrence (each as defined in the SIA) occurring in relation to Seymour Whyte • the holders of all outstanding Long Term Incentive Plans (LTIP) Options (as defined in the SIA) entering into cancellation deeds in relation to those LTIP Options (or the LTIP Options otherwise being cancelled or acquired by VINCI on terms satisfactory to it) • the counterparties to certain key third party contracts have given consent, not terminated, or given any notice terminating or advising an intention to terminate, those contracts; and • the independent expert concluding (and continuing to conclude) that the Scheme is in the best interests of shareholders. The SIA also contains customary exclusivity provisions, including a “no shop” provision, an obligation to notify the fact of approaches and matching rights. It also contains “no talk” restrictions, a “no due diligence” restriction and an obligation to notify details of approaches, each of which are subject to the Directors’ fiduciary obligations. The SIA also contains a break fee that is payable by Seymour Whyte in certain circumstances. If Seymour Whyte decides to pay one or more Scheme Dividends, the SIA requires Seymour Whyte and VINCI to each use reasonable endeavours to obtain third party debt financing of up to A$32,551,205.10 to assist dividend funding. VINCI will use reasonable endeavours to agree the terms of and to provide a guarantee in respect of such financing. If such financing cannot be obtained, VINCI will provide a loan on normal commercial terms to Seymour Whyte up to that amount. A copy of the SIA is attached to this announcement. 3 of 4 Independent Expert’s Report Seymour Whyte has appointed BDO Corporate Finance (QLD) Ltd to prepare an independent expert’s report on whether the Scheme is in the best interests of shareholders. Next steps Seymour Whyte shareholders do not need to take any action at the present time. Shareholders will be given the opportunity to vote on the Scheme at a general meeting expected to be held in September 2017. Subject to shareholder approval and the other conditions of the Scheme being satisfied, the Scheme is expected to be implemented in October 2017. Seymour Whyte expects to send a scheme booklet to shareholders in August 2017 containing information relating to the Scheme. The scheme booklet will include, among other things, the reasons for the Board’s unanimous recommendation and a copy of the independent expert’s report. An indicative timetable for the Scheme is set out in Schedule 1 of the attached SIA. These dates are indicative and subject to change. Other matters Seymour Whyte shareholders should consult their stockbroker, accountant, tax, financial or other professional adviser about the impact of the Scheme and any Scheme Dividend on their particular investment objectives. Investec Australia Limited and Corrs Chambers Westgarth are acting as Seymour Whyte’s financial and legal advisers, respectively. About VINCI Construction International Network VINCI Construction International Network represents a leading international construction contracting organisation within the broader VINCI Group, which is a global player in concessions and construction, with more than 200,000 employees across more than 100 countries. VINCI Construction International Network is a wholly owned subsidiary of Vinci Construction and is responsible for developing construction activities internationally by building a network of local companies through acquisitions. ENDS Further information: Vivian Lim – Group Communications Manager, 0434 306 131 [email protected] Note to editors: Seymour Whyte Limited is an ASX-listed company providing civil and utilities infrastructure services across Australia. Seymour Whyte Limited is the holding company of Seymour Whyte Constructions Pty Ltd and Rob Carr Pty Ltd. 4 of 4 Execution version VINCI Construction International Network Seymour Whyte Limited Scheme Implementation Agreement Ref: JH/AMK SEYM18662-9123897 3471-8823-9109v13 © Corrs Chambers Westgarth Corrs Chambers Westgarth Contents 1 Definitions 1 2 Implementation of the Scheme 18 3 Conditions 18 3.1 Conditions 18 3.2 Reasonable endeavours 22 3.3 Regulatory Approvals 22 3.4 Third Party Consent Contracts 23 3.5 Benefit and waiver of certain Conditions 24 3.6 Notification of certain events 25 3.7 Scheme voted down 26 3.8 Consultation if Conditions not met 26 3.9 Failure to agree 26 3.10 Interpretation 27 4 Scheme 27 4.1 Scheme 27 4.2 Scheme Consideration 27 4.3 Appointment of nominee 27 5 Steps for implementation 28 5.1 Target’s obligations 28 5.2 Bidder’s obligations 31 5.3 Transaction Implementation Committee 32 5.4 Preparation of the Scheme Booklet 33 5.5 Preparation of Bidder Information 34 5.6 Responsibility statements 35 5.7 Compliance with obligations 35 5.8 Court proceedings 35 5.9 Board and management changes 36 6 LTIP Options 36 6.1 Cancellation Deeds 36 6.2 Dissenting Holders 37 7 Target Directors’ recommendation and voting intentions 37 8 Conduct of business 38 8.1 Conduct of business 38 8.2 No Prescribed Occurrences 39 8.3 Target Permitted Special Dividend 39 8.4 Access 40 9 Exclusivity 42 9.1 No current discussions 42 9.2 Enforcement of rights 43 9.3 No shop restriction 43 3471-8823-9109v13 page i Scheme Implementation Agreement Corrs Chambers Westgarth 9.4 No talk 43 9.5 No due diligence 43 9.6 Notification of approaches 44 9.7 Target's response to Rival Acquirer and Bidder's right to respond 44 9.8 Fiduciary carve out 45 9.9 Revisions to a Competing Proposal 46 9.10 Equal access to information 46 10 Target Break Fee 46 10.1 Rationale 46 10.2 Target Break Fee event 46 10.3 Limitation of claims 47 10.4 Compliance with law 48 11 Representations and warranties 49 11.1 Preliminary 49 11.2 Target’s representations 49 11.3 Bidder’s representations 49 11.4 Reliance by parties 49 11.5 Severability of representations 49 11.6 Notification of breach and compliance certificate 49 12 Indemnities 50 12.1 Target’s indemnity 50 12.2 Bidder’s indemnity 50 12.3 Survival of indemnities 50 12.4 Release of Target Indemnified Parties 50 12.5 Release of Bidder Indemnified Parties 51 12.6 Directors’ and Officers’ Insurances and indemnities 51 13 Confidentiality 52 14 Public announcements 52 14.1 Announcement of Transaction 52 14.2 Public announcements 52 14.3 Required disclosure 53 14.4 Statements on termination 53 15 Termination 53 15.1 Termination by either party 53 15.2 Termination by Target 54 15.3 Termination by Bidder 54 15.4 Effect of termination 55 15.5 Damages 55 15.6 No other termination 55 16 GST 56 16.1 Construction 56 16.2 Consideration GST exclusive 56 3471-8823-9109v13 page ii Scheme Implementation Agreement Corrs Chambers Westgarth 16.3 Payment of GST 56 16.4 Timing of GST payment 56 16.5 Tax invoice 56 16.6 Adjustment event 57 16.7 Reimbursements 57 16.8 Calculations based on other amounts 57 16.9 No merger 57 17 Notices 57 17.1 General 57 17.2 How to give a communication 58 17.3 Particulars for delivery of notices 58 17.4 Communications by email 58 17.5 After hours communications 58 17.6 Process service 58 17.7 Appointment of process agent 59 18 General 59 18.1 Duty 59 18.2 Legal costs 59 18.3 Amendment 59 18.4 Waiver and exercise of rights 60 18.5 Rights cumulative 60 18.6 Consents 60 18.7 Further steps 60 18.8 Governing law and jurisdiction 60 18.9 Assignment 60 18.10 Liability 60 18.11 Counterparts 60 18.12 Entire understanding 60 18.13 Relationship of parties 61 18.14 No merger 61 18.15 Specific performance 61 18.16 Construction 61 18.17 Headings 62 Schedule 1 - Timetable 63 Schedule 2 - Target Warranties 64 Schedule 3 - Bidder Warranties 67 Execution 69 Annexure A - Scheme 71 Annexure B - Deed Poll 72 Annexure C - Announcement 73 3471-8823-9109v13 page iii Scheme Implementation Agreement Corrs Chambers Westgarth Date Parties VINCI Construction International Network of 9 place de l’Europe, 92500 Rueil- Malmaison, France, registered in the Nanterre Company and Business Registry under number 331 631 408 (Bidder) Seymour Whyte Limited ACN 105 493 203 of 12 Electronics Street, Eight Mile Plains, Qld 4113 (Target) Background A Bidder has agreed with Target for Bidder (or its nominee) to acquire all of the issued ordinary shares of Target by means of a scheme of arrangement. B Target has agreed to propose the Scheme to Target Shareholders. C The parties have agreed to implement the Scheme on and subject to the terms set out in this document. Agreed terms 1 Definitions In this document these terms have the following meanings: Accounting The following: Standards (a) accounting standards as that term is defined in the Corporations Act; (b) the requirements of the Corporations Act in relation to the preparation and content of financial reports; and (c) if and to the extent that any matter is not covered by the accounting standards or requirements referred to in paragraphs (a) or (b), other relevant accounting standards and generally accepted accounting principles applied from time to time in Australia for a business similar to Target. 3471-8823-9109v13 page 1 Scheme Implementation Agreement Corrs Chambers Westgarth Action A prosecution, legal proceeding, suit or arbitration. Advisers In relation to an entity, its legal, financial and other expert advisers in relation to the Transaction. Announcement The announcement relating to the Transaction in the form contained in annexure C. ASIC The Australian Securities and Investments Commission. Associate has the meaning given in section 12 of the Corporations Act as if section 12(1) of that Act included a reference to this document and Target was the designated body. ASX ASX Limited ACN 008 624 691 or, as the context requires, the market operated by it. ASX Listing The official listing rules of ASX. Rules Bidder Group Bidder and each of its Related Entities. Bidder Each member of the Bidder Group and the Officers, Indemnified employees and contractors of each of those entities. Parties Bidder All information regarding Bidder or the Bidder Group as Information is required to be included in the Scheme Booklet by: (a) the Corporations Act and the Corporations Regulations 2001 (Cth); (b) ASIC policy (including Regulatory Guide 60); (c) the ASX Listing Rules; or (d) other applicable laws; to the extent such information is within Bidder’s knowledge, including information regarding Bidder’s intentions on the matters referred to in paragraph 8310 of Schedule 8 of the Corporations Regulations but excluding the Independent Expert’s Report, the Tax Opinion and the Target Information. Bidder’s The meaning given in clause 4.3. Nominee Bidder Each of the representations and warranties given by Warranties Bidder to Target as set out in schedule 3. Business Day The meaning given in the ASX Listing Rules. Cancellation Each deed (in the form agreed by Target and Bidder on Deed or before the date of this document) to be entered into between an LTIP Optionholder and Target in respect of 3471-8823-9109v13 page 2 Scheme Implementation Agreement