Southeast Asia Cement Holdings, Inc.CMT

Comprehensive Corporate Disclosure on Backdoor Listing

Further to our disclosure on 21 October 2014, please find below the Comprehensive Corporate Disclosure (“CCD”) of Southeast Asia Cement Holdings, Inc. (“CMT” or the “Corporation”) based on the Guidelines on the Comprehensive Corporate Disclosure for Backdoor Listings found as Annex A of the Rules of Backdoor Listing of the Philippine Stock Exchange (“PSE”).

Presently, the Corporation, as a holding company, does not hold or own any shares of any company. Upon completion of the Subscription Agreement, the Corporation will own and hold 99% of the outstanding capital stock of PGMC, which is an income-generating company engaged in mining.

The Subscribers are also investors who have earlier executed a Share Purchase Agreement dated 9 July 2014, as amended, for the acquisition of 6,291,132,047 common shares of the Corporation held by IHoldings, Inc., Januarius Resources Realty Corporation and Kwantlen Development Corporation. As a requirement under the Securities Regulation Code, the Subscribers have launched a mandatory tender offer to acquire the shares of the minority stockholders holding 712,781,634 common shares of the Corporation. After the lapse of the tender offer period, the Subscribers completed the purchase of 6,291,132,047 common shares in accordance with the Share Purchase Agreement.

The 10,463,093,371 common shares to be issued by the Corporation to the Subscribers pursuant to the Subscription Agreement will be taken from the increase in the authorized capital stock of the Corporation from PhP2,555,000,000.00 divided into 7,300,000,000 common shares with a par value of PhP0.35 each to PhP12,555,000.000.20 divided into 35,871,428,572 common shares with a par value of PhP0.35 per share. The increase was approved by the Board of Directors of the Corporation during the special Board meeting held on 10 September 2014 and by the stockholders of the Corporation during the annual stockholders’ meeting of the Corporation held on 22 October 2014.

The increase in the authorized capital stock as well as the issuance of the 10,463,093,371 common shares to the Subscribers will be submitted to the Securities and Exchange Commission (“SEC”) for approval.

As mentioned earlier, the Corporation, as a holding company, does not own any shares of any company. As a result of the transaction, the Corporation will own and hold 99% of the outstanding capital stock of PGMC.

Because PGMC is an income-generating company engaged in mining, the Corporation will generate income from the dividends which may be declared by PGMC.

As provided in the Subscription Agreement, to acquire 99% of the outstanding capital stock of PGMC from the Subscribers, the Corporation will issue 10,463,093,371 common shares to the Subscribers and cancel the PhP2,591,855,000.00 receivables (“Assumed Receivables”) of the Corporation assumed by the Subscribers from by IHoldings, Inc., Januarius Resources Realty Corporation and Kwantlen Development Corporation (assumed pursuant to the Share Purchase Agreement dated 9 July 2014, as amended).

The total par value of the 10,463,093,371 common shares to be issued by the Corporation to the Subscribers amounted to PhP3,662,082,679.85. Adding the amount of the Assumed Receivables, the total combined value of the common shares and the Assumed Receivables amounted to PhP6,253,937,679.85.

The independent auditing firm of Punongbayan & Araullo was asked to issue an opinion on whether the transaction value was fair. In the opinion of Punongbayan, “the estimated range of values derived for PGMC is from Php7,410.30 million to Php36,416.60 million”, which is therefore more than the total par value of PhP3,662,082,679.85 and the total combined value of PhP6,253,937,679.85 mentioned above.

not applicable

Aside from acquiring 99% of the outstanding capital stock of PGMC, the Corporation will amend its articles of incorporation and by-laws. As previously disclosed by the Corporation to the SEC and the PSE, the Board of Directors of the Corporation during the special Board meeting held on 10 September 2014 and the stockholders of the Corporation during the annual stockholders’ meeting held on 22 October 2014, approved the following amendments:

1. The amendment of the articles of incorporation and by-laws to change the corporate name to “Global Ferronickel Holdings, Inc.”;
2. The amendment to Article Third to reflect the Corporation’s new address;
3. The amendment of the Article Sixth of the Articles of Incorporation of the Corporation to reflect the increase in the number of directors from nine (9) to ten (10) members;
4. The increase in the authorized capital stock of the Corporation to PhP12,555,000,000.20, which is part of the Corporation’s plan for capital restructuring;
5. The amendment of the By-Laws of the Corporation to change its fiscal year to begin on the first day of January and end on the last day of December of each year.

Thereafter, the aforementioned amendments will be submitted to the SEC for approval.

Aside from the acquisition of PGMC as well as the amendments of the articles of incorporation and by-laws of the Corporation, the Corporation intends to conduct a follow-on public offering of additional common shares to be sourced from the increase in the authorized capital stock of the Corporation to be approved by the SEC. As of date, the proceeds of the follow-on public offering are intended to be used for acquiring other mining assets which would eventually generate additional income to the Corporation. Details of the proceeds and the use of the same will be provided as part of the Registration Statement to be filed later by the Corporation with the SEC and the PSE.

PGMC started in the year 1983. PGMC’s primary purpose is to prospect, explore, locate , acquire, hold, work, develop, lease, operate and exploit mineral lands for chromite, copper, manganese, magnesite, silver, gold, and other precious and non-precious minerals; to acquire and dispose of mining claims and rights, and to conduct and carry on on the business of preparing, milling, concentrating, smelting, treating or preparing for maket and to market, self, exchange or deal other mineral products.

Pursuant to its primary purpose, PGMC acquired control of SIRC and will continue to operate the mining tenements containing nickel ore located in Surigao del Norte.

Mr. Joseph C. Sy and Atty. Dante R. Bravo, who are both directors and officers of the Corporation, have ownership interests in PGMC where 99% of the outstanding capital stock will be acquired by the Corporation. Pursuant to the Corporation Code, the approval of the stockholders of the Corporation representing at least 2/3 of the outstanding capital stock of the Corporation for the issuance of 10,463,093,371 common shares to the Subscribers pursuant to the Subscription Agreement was secured during the annual stockholders’ meeting held on 22 October 2014.

As mentioned, the Subscribers have earlier launched a mandatory tender offer to acquire the shares of the minority stockholders of the Corporation at the same price per share provided in the Share Purchase Agreement. The tender offer period lapsed on 10 October 2014.

For the transaction, the approval of the stockholders representing at least 2/3 of the outstanding capital stock of the Corporation for the issuance of 10,463,093,371 common shares to the Subscribers pursuant to the Subscription Agreement was secured during the annual stockholders’ meeting held on 22 October 2014, as required under the Corporation Code. The approval of the SEC will be secured for the issuance of the 10,463,093,371 common shares to the Subscribers.

The Corporation will also make the necessary timely disclosures to apprise the stockholders and the public on the developments affecting the Corporation.

The ownership structure and the capital structure of the listed company is based on before and after the Subscription Agreement and upon approval by the Securities and Exchange Commission and the Philippines Stock Exchange.

The ownership structure of the unlisted company is based on total outstanding shares. The unlisted company has several several classes of shares as enumerated above.