Financial Statements of Arif Habib Investment Limited by ukp10564

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									                              ADVICE FOR INVESTORS

   INVESTORS ARE ADVISED IN THEIR OWN INTEREST TO CAREFULLY READ THE
CONTENTS OF THIS OFFER FOR SALE DOCUMENT, PARTICULARLY THE RISK FACTORS
       GIVEN AT PARA 4.9, BEFORE MAKING ANY INVESTMENT DECISION.

   SUBMISSION OF FICTITIOUS AND MULTIPLE APPLICATIONS (MORE THAN ONE
    APPLICATIONS IN THE NAME OF SAME PERSON) IS PROHIBITED AND SUCH
 APPLICATIONS’ MONEY IS LIABLE TO CONFISCATION UNDER SECTION 18A OF THE
                SECURITIES AND EXCHANGE ORDINANCE, 1969




  ARIF HABIB INVESTMENT MANAGEMENT LIMITED

                      OFFER FOR SALE OF SHARES
  PRESENT OFFER CONSISTS OF 7,500,000 ORDINARY SHARES (25% OF PAID-UP
    CAPITAL) AT AN OFFER PRICE OF PKR 125/- PER SHARE (INCLUDING A
 PREMIUM OF PKR 115/- PER SHARE) OUT OF TOTAL PAID-UP CAPITAL OF PKR
300 MILLION DIVIDED INTO 30 MILLION ORDINARY SHARES OF PKR 10/- EACH


  THIS IS NOT A PROSPECTUS BY ARIF HABIB INVESTMENT MANAGEMENT
       LIMITED, BUT AN OFFER FOR SALE BY SOME OF THE EXISTING
     SHAREHOLDERS, OUT OF THEIR SHAREHOLDING IN ARIF HABIB
                  INVESTMENT MANAGEMENT LIMITED



 The subscription list will Insha’Allah open at the commencement of banking hours
  on 18th July, 2008 and will close on 19th July, 2008 at the close of banking hours


                                Advisor & Arranger




                                   Underwriters
                                Allied Bank Limited
                       First Dawood Investment Bank Limited
                            AHM Securities (Pvt.) Limited
                                Habib Bank Limited
                        Intermarket Securities (Pvt.) Limited
The date of publication of this Offer for Sale Document is
                      30th June 208
Offer for Sale of Ordinary Shares
Arif Habib Investment Management Limited


               GLOSSARY OF TECHNICAL TERMS AND ABBREVIATIONS

AHSL                         Arif Habib Securities Limited
CDA                          Central Depositories Act, 1997
CDC                          The Central Depository Company of Pakistan Limited
CDS                          Central Depository System
CFS                          Continuous Funding System
CNIC                         Computerized National Identity Card
The Commission / SECP        The Securities & Exchange Commission of Pakistan
The Company / AHIML          Arif Habib Investment Management Limited
CVT                          Capital Value Tax
EPS                          Earnings Per Share
GOP                          Government of Pakistan
OFFER                        Offer for Sale of 7,500,000 shares of face value of PKR 10/- each at an
                             offer price of PKR 125/- per share at a premium of PKR 115/- per
                             share of Arif Habib Investment Management Limited, by some of the
                             shareholders out of their shareholdings
OFFERORS                     Mr. Arif Habib, Mr. Nasim Beg, Arif Habib Securities Limited, and
                             AHIML Employees’ Stock Beneficial Ownership Trust
OFSD                         Offer For Sale Document
ITO                          Income Tax Ordinance, 2001
NP Margin                    Net Profit Margin
Ordinance                    The Companies Ordinance, 1984
PACRA                        Pakistan Credit Rating Agency
SBP                          The State Bank of Pakistan
Stock Exchange / KSE         The Karachi Stock Exchange (Guarantee) Limited
TFC                          Term Finance Certificates
WHT                          Withholding Tax
  Offer for Sale of Ordinary Shares
  Arif Habib Investment Management Limited


                                                        TABLE OF CONTENTS

Part No.
Page No.
  1     APPROVALS AND LISTING AT THE STOCK EXCHANGE ...................................................... 1
  2     SHARE CAPITAL AND RELATED MATTERS ............................................................................... 3
  3     UNDERWRITING, COMMISSIONS, BROKERAGE, AND OTHER EXPENSES...................10
  4     THE COMPANY AND PROSPECTS ................................................................................................12
  5     FINANCIAL INFORMATION ...........................................................................................................20
  6     MANAGEMENT AND RELATED MATTERS ................................................................................29
  7     MISCELLANEOUS ................................................................................................................................34
  8     APPLICATION AND TRANSFER INSTRUCTIONS ...................................................................38
  9     SIGNATORIES TO THE OFFER FOR SALE DOCUMENT........................................................42
  10    MEMORANDUM OF ASSOCIATION .............................................................................................43
  11.   APPLICATION FORMS
Offer for Sale of Ordinary Shares
Arif Habib Investment Management Limited


                                                  PART 1

1     APPROVALS AND LISTING AT THE STOCK EXCHANGE

1.1    APPROVAL OF THE SECURITIES & EXCHANGE COMMISSION OF PAKISTAN

The approval of the Securities & Exchange Commission of Pakistan (“SECP” or “the Commission”) has
been obtained for the issue, circulation, and publication of this Offer for Sale Document (“OFSD”) as
required under section 62, read with section 57 and section 61 of the Companies Ordinance, 1984 (“the
Ordinance”).

It must be distinctly understood that in giving this approval, the SECP does not take any
responsibility for the financial soundness of any scheme stated herein or for the correctness of any of
the statements made or opinions expressed with regard to them.

The SECP has not evaluated the quality of the offer, including justification for the premium, and its
approval of the offer should not be construed as any commitment to the same. The public / investors
should conduct their own independent investigation and analysis regarding the quality of the offer
before subscribing.

1.2    CLEARANCE OF THE OFFER FOR SALE DOCUMENT BY THE STOCK EXCHANGE
The OFSD has been cleared by the Karachi Stock Exchange (Guarantee) Limited (“KSE” or “the Stock
Exchange”) in accordance with the requirements of its Listing Regulations. While clearing this OFSD, the
Stock Exchange neither guarantees the correctness of the contents of this document nor the viability
of Arif Habib Investment Management Limited (“AHIML” or “the Company”).

The Stock Exchange has not evaluated the quality of the issue, including the justification for the
premium and its clearance should not be construed as any commitment to the same. The public /
investors should conduct their own independent investigation and analysis regarding the quality of
the offer before subscribing.

1.3    FILING OF THE OFFER FOR SALE DOCUMENT AND OTHER DOCUMENTS WITH
       THE REGISTRAR OF COMPANIES

On behalf of the Offerors, the Company has delivered to the Registrar of Companies, Companies
Registration Office (“CRO”), Karachi, as required under section 57(3) and (4) of the Ordinance, a copy of
the OFSD signed on behalf of Offerors, together with the following documents attached hereto:

        (a) A letter dated May 22, 2008, from the Auditors of the Company, M. Yousuf Adil Saleem &
             Co., Chartered Accountants, consenting to the publication of their name in the OFSD, as
             required under section 55 of the Companies Ordinance, 1984, which contains in Part V certain
             statements and reports issued by them as experts (which consent has not been withdrawn).

        (b) Written confirmations of the Auditors, Legal Advisor, and Bankers to the Offer mentioned in
             this OFSD consenting to act in their respective capacities, as required under section 57(5) of
             the Ordinance.

        (c) Copies of material contracts and agreements mentioned in Part 7.7 of this OFSD as required
             under section 57(4) of the Ordinance.

        (d) Consent of the Directors and Chief Executive of the Company who have consented to their
             respective appointments being made and their having been named or described as such
             Directors and Managing Director / Chief Executive in this OFSD, as required under Section
             57(3) of the Ordinance, read with sub-clause (1) of clause (4) of part 1 of the second schedule of
             the Ordinance.


                                                     -1-
Offer for Sale of Ordinary Shares
Arif Habib Investment Management Limited




1.4    LISTING AT THE STOCK EXCHANGE
Application has been made to the Karachi Stock Exchange for permission to deal in and for the quotation of
the shares of the Company.

If for any reason, the application for formal listing is not accepted by the Stock Exchange, the Company
undertakes that a notice to that effect will immediately be published in the press, and thereafter application
money to the applicants will be refunded in pursuance of this Offer for Sale Document, as required under
the provisions of section 72 of the Ordinance.




                                                     -2-
Offer for Sale of Ordinary Shares
Arif Habib Investment Management Limited


                                                   PART 2

2     SHARE CAPITAL AND RELATED MATTERS

2.1     SHARE CAPITAL
No. of shares                                                     Face value     Premium        Total
                    AUTHORIZED CAPITAL
      30,000,000    Ordinary shares of Rs. 10/- each              300,000,000               -   300,000,000
                    ISSUED SUBSCRIBED & PAID UP
                    CAPITAL
                    Issued for cash
       5,000,000    Ordinary shares of Rs. 10/- each                50,000,000                    50,000,000
                    Issued as bonus
    25,000,000      Ordinary shares of Rs. 10/- each               250,000,000                   250,000,000
   30,000,000                        TOTAL                         300,000,000                   300,000,000
No. of shares                                                     Face value     Premium        Total
                    THE EXISTING ISSUED,
                    SUBSCRIBED & PAID UP CAPITAL
                    OF THE COMPANY IS HELD AS
                    FOLLOWS:
                    Major shareholders
       4,799,968    Mr. Arif Habib                                  47,999,680              -     47,999,680
       3,000,004    Mr. Nasim Beg                                   30,000,040              -     30,000,040
      18,720,005    M/s. Arif Habib Securities Limited             187,200,050              -    187,200,050
                    M/s. AHIML Employees Stock Beneficial
       3,479,994                                                    34,799,940              -     34,799,940
                    Ownership Trust
                    Directors
                4   Mr. Saleem Chamdia                                     40               -              40
                4   Mr. Sirajuddin Cassim                                  40               -              40
                4   Mr. Akmal Jameel                                       40               -              40
                4   Mr. Muhammad Shafi Malik                               40               -              40
                4   Mr. Muhammad Kashif                                    40               -              40
                1   Mr. M. Qamar Beg                                       10               -              10
                    Other shareholders
               4    Mr. Samad A. Habib                                     40               -            40
               4    Mr. John Kirkham                                       40               -            40
      30,000,000                   TOTAL                          300,000,000               -   300,000,000

                               PRESENT OFFER
No. of shares                                                     Face value      Premium          Total
                    The present Offer of 7,500,000 ordinary
                    shares (25% of paid-up capital) having
                    par value of Rs. 10/- each (at an offer
                    price of Rs. 125/- per share inclusive of a
                    premium of Rs. 115/- per share) is being
                    made to the general public as under:
         375,000    Employees of the Company                        3,750,000     43,125,000     46,875,000
       7,125,000    General Public                                 71,250,000    819,375,000    890,625,000
       7,500,000                    TOTAL                          75,000,000    862,500,000    937,500,000
                    OFFERORS
       4,799,968    Mr. Arif Habib                                  47,999,680    551,996,320    599,996,000
         750,001    Mr. Nasim Beg                                    7,500,010     86,250,115     93,750,125


                                                       -3-
Offer for Sale of Ordinary Shares
Arif Habib Investment Management Limited


        1,080,032   Arif Habib Securities Limited                     10,800,320     124,203,680      135,004,000
                    AHIML Employees’ Stock Beneficial
          869,999                                                       8,699,990    100,049,885      108,749,875
                    Ownership Trust
        7,500,000   TOTAL                                             75,000,000     862,500,000     937,500,000


Notes:
      (i) As per Rule 3(I) (IV) of the Companies (Issue of Capital) Rules, 1996, the sponsors shall, at all times,
          retain at least twenty five per cent (25%) of the paid-up capital of the Company.
      (ii) As per Listing Regulation No. 6(A) 7(i) of the KSE, sponsors’ shareholding in excess of 25% shall
           not be saleable for a period of six months from the date of public subscription.
      (iii) As per Listing Regulation 6(A) 7(ii) of the KSE, the shares subscribed by the employees of the
            Company shall not be saleable for a period of 6 months from the date of public subscription.

2.2      OPENING AND CLOSING OF SUBSCRIPTION LIST

The subscription list will Insha’Allah open on 18th July, 2008 at the commencement of banking hours
and will close on 19th July, 2008 at the close of banking hours.

2.3      INVESTOR ELIGIBILITY
All Pakistani residents, provident funds/trusts, pension/gratuity funds (subject to the term of their trust
deeds), financial institutions and companies, body corporate or other legal entities (to the extent permitted
by their constitutive or corporate documents, as the case may be) are allowed to subscribe to the shares
offered to the general public.

2.4      OFFER PRICE, MINIMUM AMOUNT OF APPLICATION, AND BASIS OF ALLOTMENT
         OF SHARES

  (a)      This offer is being made at a price of Rs. 125/- per share of par value of Rs. 10/- each. The offer
           price includes a premium of Rs. 115/- per share.

  (b)      Applications must be made for 500 shares or in multiples of 500 shares only. Applications, which
           are neither for 500 shares nor for multiples of 500 shares, shall be rejected.

  (c)      The minimum amount of application for subscription of 500 shares both in cases of physical
           transfer and transfer under book-entry system is Rs. 62,500/-. The transfer fee shall be borne by the
           Offerors.

  (d)      Application for shares below the value of Rs. 62,500/- will not be entertained.

  (e)      SUBMISSION OF FICTITIOUS AND MULTIPLE APPLICATIONS (MORE THAN ONE
           APPLICATIONS IN THE NAME OF SAME PERSON) IS PROHIBITED AND SUCH
           APPLICATIONS’ MONEY SHALL BE LIABLE TO CONFISCATION UNDER SECTION
           18-A OF THE SECURITIES AND EXCHANGE ORDINANCE, 1969.

  (f)      If the shares to be offered to the general public are sufficient for the purpose to accommodate all the
           applications then, all applications shall be accommodated.
  (g)      If this offer is oversubscribed in terms of number of applications and amount, the shares will be
           allotted by conducting computer balloting in the presence of representatives of the Stock Exchange
           in the following manner:

           i. If all applications for 500 shares can be accommodated, then all such applications will be
              accommodated first. If all applications for 500 shares cannot be accommodated, then balloting
              will be held among the applications for 500 shares only.



                                                        -4-
Offer for Sale of Ordinary Shares
Arif Habib Investment Management Limited


       ii. If all applications for 500 shares have been accommodated, and shares are still available for
           allocation, then all applications for 1,000 shares will be accommodated. If all applications for
           1,000 shares cannot be accommodated, then balloting will be held among applications for 1,000
           shares only.

       iii. If all applications for 500 shares and 1,000 shares have been accommodated, and shares are still
            available for allocation, then all applications for 1,500 shares will be accommodated. If all
            applications for 1,500 shares cannot be accommodated, then balloting will be held among
            applications for 1,500 shares only.

       iv. If all applications for 500, 1,000 and 1,500 shares have been accommodated, and shares are still
           available for allotment, then all applications for 2,000 shares will be accommodated. If all
           applications for 2,000 shares cannot be accommodated, then balloting will be held among
           applications for 2,000 shares only.

       v. After the allotment in the above mentioned manner, the balance shares, if any, will be allotted
          in the following manner:

         1.      If the remaining shares are sufficient to accommodate each application for over 2,000
                 shares, then 2,000 shares will be allotted to each applicant and the remaining shares will be
                 allotted on a pro-rata basis.

         2.      If the remaining shares are not sufficient to accommodate all remaining applications for at
                 least 2,000 shares, then balloting will be conducted for allocation of 2,000 shares to each
                 successful applicant.

 (h)   If the offer is over subscribed in terms of amount only, then the allocation of shares will be made in
       the following manner:


           i. First preference will be given to applicants who applied for 500 shares;

          ii. Next preference will be given to applicants who applied for 1,000 shares;

          iii. Next preference will be given to applicants who applied for 1,500 shares;

          iv. Next preference will be given to applicants who applied for 2,000 shares;

              After allocation in the above manner, the balance shares, if any, will be allotted on pro-rata
              basis to the applicants who applied for more than 2,000 shares.

 (i)   In case the offer is undersubscribed, all the applicants whose applications are accepted will be
       allotted shares applied for and the remaining shares will be taken up by the underwriters in
       proportion to their respective underwriting commitments.

 (j)   In addition to the above, employees of the Company have been given preferential allocation of
       375,000 shares in the Offer for Sale of shares, to which they will subscribe on the public
       subscription days.

 (k)   Every permanent employee of the company is entitled to participate in the employee quota of
           public offer.

 (l)   No advance will be given by the company to the employees to apply for subscription of shares.

 (m)   The basis of allotment of shares out of the quota allocated to employees shall be the same as for the
       general public


                                                     -5-
Offer for Sale of Ordinary Shares
Arif Habib Investment Management Limited


  (n)     In case the offer to the employees is undersubscribed, then the remaining shares will be allocated to
          the general public

  (o)     Incase both offer to the employees and to the general public is undersubscribed; all the remaining
          shares shall be taken up by the underwriters in proportion to their respective underwriting
          commitments.

  (p)     Allocation of shares will be subject to the scrutiny of the applications.

2.5     REFUND OF SUBSCRIPTION MONEY TO UNSUCCESSFUL APPLICANTS
The Company, on behalf of the Offerors, shall take a decision within 10 days of the closure of the
subscription list as to which applications have been accepted or are successful. Refund of money in case of
unaccepted or unsuccessful applications will be made within 10 days of the date of such decision, as required
under the provisions of section 71 of the Ordinance.
As per sub-section (2) of section 71 of the Ordinance, if the refund as required by sub-section 1 of section 71
of the Ordinance is not made within the time specified therein, the Offerer shall be liable to repay the
money with surcharge at the rate of 1.5%, for every month or part thereof from the expiration of the 15 th
day and, in addition, to a fine not exceeding Rs. 5,000/- and in the case of continuing offence, to a further
fine not exceeding Rs. 100/- per day after the said 15th day of which default continues. Provided, an Offerers
shall not be liable if they proves that the default in making the refund was not due to misconduct or
negligence on their part.

2.6     ISSUE AND DISPATCH OF SHARE CERTIFICATES
The Company will dispatch to the successful applicants, physical share certificates through the Bankers to
the Offer or credit to the Central Depository System (the “CDS”) accounts within 30 days of the close of the
public subscription list, as per Listing Regulations of the KSE.
Shares will be transferred either in scripless form in the CDS of the Central Depository Company (the
“CDC”) or in the shape of physical scrips on the basis of option exercised by the successful applicants. Shares
in physical scrip form will be dispatched to the Bankers to the Offer within 30 days from the date of closing
of subscription list, whereas scripless shares will be credited through book entry into the respective CDS
accounts of the successful applicants maintained with the CDC.
The applicants who opt for receipt of shares in scripless form in the CDS should fill in the relevant columns
of the Application Form. In order to exercise the scripless option, the applicant should have a CDS account
at the time of subscription.
If the Company defaults in complying with the requirements of the Listing Regulations of the KSE, it shall
pay to the KSE a penalty of Rs. 500/- per day or part thereof during which the default continues. The KSE
may also notify the fact of such default and the name of the Company by notice and also by publication in
its Ready Board Quotation.

2.7     TRANSFER OF SHARES

      2.7.1   Physical Scrips
The directors of the Company will not refuse to transfer any fully paid shares unless the transfer deed is for
any reason, defective or invalid under the provisions of Section 77 of the Ordinance. Provided that the
Company shall within 30 days from which the instrument of transfer was lodged with it, notify the defect or
invalidity to the transferee who shall, after the removal of such defect or invalidity, be entitled to re-lodge
the transfer deed with the Company.

      2.7.2   Transfer under book entry system
The shares maintained within the CDS in the book entry form shall be transferable in accordance with the
provisions of the Central Depositories Act, 1997 and the CDC Regulations.



                                                        -6-
Offer for Sale of Ordinary Shares
Arif Habib Investment Management Limited


2.8    SHARES ISSUED IN PRECEDING YEARS
The following are the details of the shares issued by the Company in preceding years.
                                                                             Premium
           Date           Consideration      No. of shares    Par value                     Amount
                                                                             per share
                       Initial
       30-Aug-2000                                        7        10            -                   70
                       subscription
      04-Dec-2000      Cash                          50,000        10            -             500,000
      26-Jun-2001      Cash                       3,949,993        10            -          39,499,930
      08-Sep-2005      Cash                       1,000,000        10            -          10,000,000
      08-Nov-2005      Bonus                      1,500,000        10            -          15,000,000
      09-May-2007      Bonus                      6,500,000        10            -          65,000,000
      12-Sep-2007      Bonus*                     7,000,000        10            -          70,000,000
      10-May-2008      Bonus**                  10,000,000         10            -         100,000,000
                    TOTAL                       30,000,000         10                      300,000,000
 * First interim bonus @ 53.85% for the financial year ended June 30, 2008
 ** Second interim bonus @ 50% for the financial year ended June 30, 2008

2.9    PRINCIPAL PURPOSE OF THE OFFER FOR SALE
The principal purpose of the Offer for Sale is (i) broadening the investor base through an increase in the
number of shareholders, and (ii) providing the public investor an opportunity to participate in the future of
a company with sound prospects.

2.10   INTEREST OF SHAREHOLDERS
None of the shareholders of the Company have any special or other interest in the property or profits of the
Company, other than as shareholders of the Company.

2.11   DIVIDEND POLICY

The rights in respect of capital and dividends attached to each share are and will be the same. AHIML in
general meeting may declare dividends but no dividends shall exceed the amount recommended by the
directors.
The directors may from time to time decide to pay to the members such interim dividends as appear to the
directors to be justified by the profits of the Company. No dividends shall be paid otherwise than out of the
profits of the Company for the year or any other undistributed profits. No unpaid dividend shall bear
interest or mark-up against the Company. The dividend shall be paid within the period stipulated in the
Ordinance.

2.12   ELIGIBILITY FOR DIVIDEND

The shares of the Company comprising the present Offer shall rank pari passu with the existing
ordinary shares in all matters including the right to such bonus and right issue and dividend, as may
be declared by AHIML subsequent to the date of this OFSD.
The Company has already declared interim cash dividend of 75% and two interim bonuses at the rate
of 53.85% and 50% for the year ended June 30, 2008. The shares issued by the Company under Offer
for Sale will not be eligible to the said interim cash dividend and bonuses.

2.13   DEDUCTION OF ZAKAT
Cash dividend distribution will be subject to the deduction of Zakat at source pursuant to the provisions of
the Zakat and Ushr Ordinance, 1980 (XVIII of 1980).

2.14   WITHHOLDING TAX ON DIVIDENDS
Cash dividend distribution to the shareholders will be subject to withholding tax at source under section 150
of the Income Tax Ordinance, 2001 at the rate of 10% as specified in Part I, Division III of first schedule to

                                                      -7-
Offer for Sale of Ordinary Shares
Arif Habib Investment Management Limited


the said ordinance. In terms of the provisions of section 8 of the said ordinance, said deduction at source,
shall be deemed to be full and final liability in respect of such profits.

2.15   EXEMPTION FROM CAPITAL GAINS
Capital gains derived from the sale of listed securities are exempted from income tax pursuant to clause (110)
of part 1 of the second schedule of the Income Tax Ordinance. This exemption is presently available up to
the income year ending June 30, 2008.

2.16   CAPITAL VALUE TAX (CVT) & WITHHOLDING TAX ON SALE / PURCHASE OF
       SHARES
Pursuant to the provision of section 233(A) of the Income Tax Ordinance and Capital Value Tax (Finance
Act 1989) the following charges are applicable on sale and purchase of securities:
        (a)      0.02% CVT will be charged on purchase of all shares, modaraba certificates, and
                 instruments of redeemable capital as defined in the Ordinance.

        (b)      0.01% WHT will be charged on sale of all shares, modaraba certificates, and instruments of
                 redeemable capital as defined in the Ordinance.

2.17   DEFERRED TAXATION
Deferred tax is recognized using the balance sheet liability method on all temporary differences between the
amounts attributed to the assets and liabilities for financial reporting purposes and amounts used for taxation
purposes. Deferred tax is not recognized on differences relating to investments in subsidiaries to the extent
that they are not likely to reverse in the foreseeable future. Deferred tax asset is measured at the tax rates
that are expected to be applied to the temporary differences, based on the laws that have been enacted or
substantively enacted at the reporting date. A deferred tax asset is recognized only to the extent that it is
probable that future taxable profits will be available against which the assets can be utilized.

The Company has made a provision of PKR 3,882,627/- on account of deferred tax liability as on 31 Dec.
2007.

2.18   JUSTIFICATION FOR THE PREMIUM
The premium of Rs. 115 per share on the face value of Rs 10 per share is considered adequately justified,
based on the following:
Attractive valuation: The fair value of AHIML share has been estimated using a Dividend Discount Model
(DDM) on a 6 years’ investment horizon. Based on an equity and money market exposure of funds under
management of around 40:60, the weighted average required rate of return averages to 16.84%. Furthermore,
a dividend growth rate of 5.4% is estimated using an average retention ratio of 20% (or 80% dividend payout)
and an average return on equity of around 27%. Given the above calculations, the fair value per share is
estimated at PKR 160.65/- per share. The offer price entails a discount of 22% to estimated fair value. The
valuation summary for the DDM based valuation is given below:
 Required rate of return                                16.84%
 Growth rate                                            5.4%
 Terminal value                                         PKR 212.97
 Sum of discounted dividend                             PKR 49.21
 Discounted terminal value                              PKR 111.44
 Fair value                                             PKR 160.65 per share
 Discount to fair value                                 22.00%
 Offer price                                            PKR 125 per share

Management quality: AHIML's management brings decades of strong experience and a history of success.
Their business acumen and expertise have helped the Company achieve its goals, resulting in significant
increase in shareholders’ wealth. AHIML remains keen in providing innovative products that give investors
the confidence in the Company’s management expertise and their fund management capabilities. AHIML is
rated AM2 with a positive outlook by PACRA.


                                                      -8-
Offer for Sale of Ordinary Shares
Arif Habib Investment Management Limited


Strong sponsors: The Company is a part of the Arif Habib Group. The Group is well-known for
implementing best management practices in its ventures and for posting strong shareholder returns.

Brand franchise: The Group has had a number of successful listings of its financial sector companies: Arif
Habib Securities Limited (listed in May 2001), Arif Habib Limited (listed in December 2006), and Arif
Habib Bank Limited (listed in January 2008). The first two have consistently generated superior alphas and
have won the prestigious KSE Top Companies Awards.

The track record of these companies has created strong goodwill among the investing public.

2.19   FINANCIAL HIGHLIGHTS
Financial highlights of the Company, as per audited accounts for the last 5 years including HY08 accounts
are given below:
PKR million                         HY08     2007    2006    2005    2004
Revenue                              318      543     608     347     141
Operating expenses                   176      260     256     156      88
Net profit                           107      215     266     122      29
Total assets                         921      953     882     734     389
Total liabilities                    253      255     307     468     270
Current assets                       437      587     611     467      63
Current liabilities                  190      167     244     223      70
Shareholders equity                  668      698     575     266     119
No of shares outstanding (in
million)                              20      13      6.5      4       4

Ratio analysis                       HY08 2007       2006    2005    2004
NP ratio                             34% 40%         44%      35%    21%
Current ratio                         2.30  3.51      2.50    2.09    1.00
Book value per share                 33.40 53.69     88.46   66.50   32.75
EPS (PKR)                            5.38 16.57      20.8    30.68   7.29




                                                    -9-
Offer for Sale of Ordinary Shares
Arif Habib Investment Management Limited



                                                   PART 3

3     UNDERWRITING, COMMISSIONS, BROKERAGE, AND OTHER EXPENSES

3.1    UNDERWRITING
The present offer of 7,500,000 shares at a price of PKR 125/- per share has been fully underwritten as
follows:
       S. No.     Name of the underwriter                              No. of shares     Amount (Rs.)
          1.      Allied Bank Limited                                      2,000,000      250,000,000
          2.      First Dawood Investment Bank Limited                     2,000,000      250,000,000
          3.      AHM Securities (Pvt.) Limited                            1,200,000      150,000,000
          4.      Habib Bank Limited                                       1,200,000      150,000,000
          5.      Intermarket Securities (Pvt.) Limited                    1,100,000      137,500,000
                                                        TOTAL             7,500,000       937,500,000

If, and to the extent, shares hereby offered are not subscribed and paid for in cash and in full by the closing
of the subscription list, the underwriters shall, within 15 days of being duly called by the Offerers to do so,
subscribe and pay for, or procure subscribers to subscribe and pay for, in cash and in full, those shares not so
subscribed, in proportion to their underwriting commitments.
In the opinion of the Offerors, the resources of the underwriters are sufficient to discharge their
underwriting commitments.

3.2    BUY-BACK / REPURCHASE AGREEMENT
THE UNDERWRITERS HAVE NOT ENTERED INTO ANY BUY-BACK / REPURCHASE
AGREEMENT WITH THE OFFERORS OR ANY OTHER PERSON IN RESPECT OF THIS
OFFER. ALSO, NEITHER THE OFFERORS NOR ANY OF THEIR ASSOCIATES HAVE
ENTERED INTO ANY BUY-BACK / REPURCHASE AGREEMENT WITH THE
UNDERWRITER(S) OR THEIR ASSOCIATE(S). THE OFFERORS, THEIR ASSOCIATE(S) AND
THE COMPANY SHALL NOT BUY-BACK / RE-PURCHASE SHARES FROM THE
UNDERWRITER(S) AND/OR THEIR ASSOCIATES.

3.3    UNDERWRITING COMMISSION
The underwriters have been paid an underwriting commission at the rate of 1% of the amount of the offer
underwritten by them. In addition, a take up commission at the rate of 1.5% shall be paid to the
underwriters on the value of shares required to be subscribed by them by virtue of their respective
underwriting commitments.

3.4    COMMISSION TO THE BANKERS TO THE OFFER
A commission at the rate of 0.50% of the amount collected on allotment in respect of successful applications
will be paid by the Offerors to the Bankers to the Offer for services to be rendered by them. No commission
shall be paid to the bankers in respect of shares taken up by the underwriters by virtue of their underwriting
commitments.

3.5    BROKERAGE
Brokerage shall be paid to the members of the KSE, LSE and ISE at the rate of 1.0% of the value of the
shares (including premium) actually sold through them. No brokerage shall be payable in respect of shares
including premium taken up by the underwriters by virtue of their underwriting commitment.




                                                      -10-
Offer for Sale of Ordinary Shares
Arif Habib Investment Management Limited


3.6    EXPENSES OF THE OFFER FOR SALE
The expenses of this Offer are estimated not to exceed Rs. 40.035 million, out of which the listing fees of the
KSE and membership fees of the CDC shall be borne by the Company while the balance shall be borne by
the Offerors.
          Expense                                                   Rate           Amount (Rs)
          Underwriting commission                                     1%                 9,375,000
          Take-up commission*                                       1.5%               14,062,500
          Bankers to the offer commission                           0.5%                 4,687,500
          Brokerage to the members of the Stock Exchange*             1%                 9,375,000
          Printing & publication cost                                                    1,000,000
          KSE fees and charges                                                             385,000
          CDC fees and deposits                                                            300,000
          SECP application and processing fee                                               50,000
          Transfer fees                                                                    300,000
          Miscellaneous expenses**                                                         500,000
          TOTAL                                                                       40,035,000
        * These amounts represent the maximum possible costs relating to the subscription amount
        ** Miscellaneous expenses include stamp papers, printing costs, photocopies etc.




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Offer for Sale of Ordinary Shares
Arif Habib Investment Management Limited


                                                  PART 4
4        THE COMPANY AND PROSPECTS

4.1        ARIF HABIB INVESTMENT MANAGEMENT LIMITED
Arif Habib Investment Management Limited (the Company) was incorporated on August 30, 2000, as an
unquoted public limited company under the Companies Ordinance, 1984, with registered office at Karachi,
Pakistan. The Company is registered as an Asset Management Company, Investment Adviser under the
Non-Banking Finance Companies (Establishment and Regulation) Rules, 2003 (NBFC Rules), the Non-
Banking Finance Companies and Notified Entities Regulations, 2007 (NBFC Regulations), and Pension
Scheme Manager under Pension Rules 2005. The Company is currently acting as an Asset Management
Company, Investment Adviser and Pension Scheme Manager.

The Company manages 5 open-end, 3 closed-end mutual funds and 2 pension schemes, having assets under
management of PKR 25.782 billion1. AHIML is an industry leader, setting international standards and
bringing innovative products to markets across the country and abroad. It is one of the fastest growing asset
management companies and amongst the pioneers of mutual fund industry in Pakistan. The Company keeps
abreast to the best practices standards and has a self-imposed and ongoing daily compliance audit carried out
by the funds’ external auditors. This enables the Company to comply with NBFC Rules and Regulations
and internal policies and processes – to augment growth of the Company and safeguard the interest of unit
holders and investors.

Pakistan Credit Rating Agency (PACRA) has assigned the following entity ratings to the Company:

                                              Long Term                          Short Term
    Entity rating                           A+ (Single A Plus)                   A1 (A One)
    Asset manager rating                                  AM2 (Positive Outlook)

4.2        FUNDS UNDER MANAGEMENT
Open-end mutual funds

Pakistan Stock Market Fund (PSMF)
An open-end mutual fund, investing in both growth and value stocks listed in Pakistan. The Fund is driven
by value investing with an emphasis on liquidity while maintaining a fair exposure in such shares that may
not be actively traded but are likely to deliver high returns in the long-term. The fund has offered a total
return of 615.86% since its inception.

Pakistan Income Fund (PIF)
PIF invests in a range of fixed income securities and transactions. The weightage of investment mix of the
portfolio is managed in a manner that reduces the risk of loss in the market value of the investments due to
any major upward movement in interest rates in the country. Being an income fund, PIF’s emphasis is on
managing interest rate risk, and as a policy, the Fund keeps the average duration of its portfolio less than
two years. The fund has generated a total return of 82.94% since inception.

Pakistan International Element Islamic Fund (PIEIF)
The fund is a Sharia’ah compliant fund with an objective to invest primarily in domestic markets using a
value investing approach. This fund also invests in international markets either through international
Shariah complaint mutual funds or directly in Shariah compliant securities identified through fund managers
of standing in the respective markets. The fund has made a total return of 22.95% since inception.

Pakistan Capital Market Fund (PCM)
PCMF is a broader capital market fund with allocation between equity, debt and money market
instruments. PCMF is the first Fund in Pakistan which converted from a closed-end to an open-end fund in



1
    Total funds size as of March 31, 2008

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Offer for Sale of Ordinary Shares
Arif Habib Investment Management Limited


November, 2005. The fund was launched in the year 2004, and offered to its investors a total return of
131.28% since inception.

MetroBank-Pakistan Sovereign Fund (MSF)
The MetroBank-Pakistan Sovereign Fund is an open-end fund, investing primarily in government securities.
The Fund seeks to achieve return available from investment in government securities. The total return
offered by the fund since inception is 15.47%.

Closed-end mutual funds

Pakistan Premier Fund Limited
Pakistan Premier Fund Limited is a public limited company incorporated under the Companies Ordinance,
1984, and also under Rule 38 of the Non-Banking Finance Companies (Establishment and Regulation) Rules,
2003 (NBFC Rules) as an Investment Company. The company primarily invests in shares of listed
companies, term finance certificates and short-term reverse repurchase transactions. It has offered a total
return of 243.23% to its perspective investors since inception.

Pakistan Strategic Allocation Fund
The policy of this Fund (PSAF) is to invest in a mix of traded securities covering debt, equity, money
market transactions (such as financing arrangements under Continuous Funding System and inter-bank
placements, etc.) and deposits in the Pakistan Rupee. PSAF is an equity fund with investment allocation
between growth and value segment in the proportion of 85:15 respectively. The fund has offered a total
return of 99.37% since its inception.

Pakistan Capital Protected Fund – 1
This is a closed-end fund with a minimum capital of Rs. 200 million with an upper limit of Rs. 3 billion. The
fund has been constituted with an objective to keep the principal portion protected and earn reasonable
returns. The total return offered by the fund since inception is 2.10%

Pension schemes

Pakistan Pension Fund
A flexible savings cum investment plan which facilitates individuals to save for their retirement in a
systematic way, topping up their savings with investment returns at their optimal asset allocations and
allowing them special tax benefits.

Pakistan Islamic Pension Fund
A flexible savings cum-investment scheme which facilitates individuals to save for their retirement in a
systematic way, topping up their savings with investment returns at their desired investment exposures and
granting them special tax benefits, with numerous valuable options before, at, and after retirement.

Net Asset Value of funds under management:
                                                                                         Rupees in million
                                      June 10,                                                  Date of
 Fund name                                         HY08        2007       2006       2005
                                        2008                                                     launch
 Open-end fund
 Pakistan Income Fund                    7,767       9,260      9,406      5,686       3,706   11 Mar 2002
 Pakistan Stock Market Fund              3,430       3,709      3,246      3,617       2,712   11 Mar 2002
 MetroBank Pakistan Sovereign
                                           366         824      1,373      1,014         464   01 Mar 2003
 Fund
 Pakistan International Element                                                                     02 May
                                           996       1,046      1,073      1,378       N/A
 Islamic Fund                                                                                          2006
 Pakistan Capital Market Fund              879       1,143      1,084      1,436       1,698    24 Jan 2004

 Closed-end fund

                                                    -13-
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Arif Habib Investment Management Limited


    Pakistan Capital Protected Fund –
                                                       610           628         N/A           N/A           N/A         27 Jul 2007
    1
    Pakistan Premier Fund Limited                    2,527        2,631          2,910         2,576         2,207      26 Dec 2002
    Pakistan Strategic Allocation
                                                     3,444        3,396          4,080         3,989         3,201         Aug 2004
    Fund

    Pension Schemes
    Pakistan Pension Fund                              100           102           96          N/A           N/A        27 Jun 2007
    Pakistan Islamic Pension Fund                       93            91         N/A           N/A           N/A        31 Oct 2007

4.3       INVESTMENT PLANS
The Company also offers to its clients, investment plans to meet their individual financial needs and
maintaining life styles. These plans include:

                     Monthly Saving Scheme
                     Pension Builder
                     Monthly Income Plan
                     Smart Portfolio
                     Balanced Portfolio
                     Smart Trader
                     Hajj Saver Account
                     Dynamic Income Provider

4.4       OPERATIONS
AHIML’s principal sources of revenue are investment advisory, asset management services, and pension fund
schemes provided to the funds under its management. In HY2008, total management and advisory fee from
the funds contributed around 72% of the total revenue. Fee from its funds is received on a monthly basis. As
per the NBFC Rules 2003, the Company is entitled to be paid remuneration for the said services. The
remuneration should not exceed three (3) percent of the average net assets of a fund for the first five years of
the fund’s existence and thereafter two (2) percent of such assets.

AHIML is currently managing five open-end, three closed-end mutual funds, and two pension schemes. The
total assets under management amounted to PKR 25,782 million (as at 31 March 2008).

The management fee charged by AHIML as percentage of average NAV from each fund is mentioned below:

Listed funds
                                  - Pakistan Stock Market Fund                                    2.00%
                                  - Pakistan International Element Islamic Fund                              Type A & B 3%
                                                                                                  Type C & D 2%2
                                  - Pakistan Income Fund                                          1.50%
                                  - Pakistan Capital Market Fund                                  3.00%
                                  - Pakistan Premier Fund                                         2.00%
                                  - Pakistan Strategic Allocation Fund                                       3.00%


2
    Type A units have no redemption restrictions and back-end load and are charged the normal front-end load.
Type B units have no redemption restrictions and front-end load (except for transaction cost) but are charged a reducing back-end load
for the first 3 years (3.0% reducing by 1.0% per year), and at the end of the 3 years of investment there is no back-end load.
Type C units are issued with an initial investment of Rs. 10 million with Rs. 1 million thereafter. No front-end restrictions but only a
transaction cost of 0.25% are charged. A reducing back-end load for the first 3 years (3.0% reducing by 1.0% per year), and at the end of
the 3 years of investment there is no back-end load.

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Offer for Sale of Ordinary Shares
Arif Habib Investment Management Limited


Non-listed funds
                      - MetroBank-Pakistan Sovereign Fund    5.00% of operating income
                      - Pakistan Pension Fund                1.50%
                      - Pakistan Islamic Pension Fund        1.50%
                      - Pakistan Capital Protected Fund -1           3.00%


                                                             Source: AHIML




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Arif Habib Investment Management Limited


The management and advisory fee received by AHIML from funds under its management from FY2005 to
HY2008 is as follows:

                                                                                Rupees in thousand
                Fund Name                         HY2008         2007         2006         2005
 Pakistan Stock Market Fund                        34,548         92,272      104,201       54,307
 Pakistan International Element Islamic
                                                     11,187       28,526        3,759         N/A
 Fund
 Pakistan Income Fund                                71,662       97,791       65,711       47,093
 Pakistan Capital Market Fund                        18,593       37,592       50,066       54,932
 MetroBank Pakistan Sovereign Fund                    2,990        5,836        2,984        1,273
 Pakistan Pension Fund                                  747        N/A          N/A          N/A
 Pakistan Islamic Pension Fund                         407        N/A           N/A          N/A
 Pakistan Premier Fund                              26,513       49,416        52,590       35,324
 Pakistan Strategic Allocation Fund                 52,512      106,615       123,110       87,192
 Pakistan Capital Protected Fund – 1                 8,622        N/A           N/A          N/A
 Total fee received                                227,781      418,048       402,421      280,121

4.5    INVESTOR SERVICES
AHIML offers a wide range of services to its clients. These include; (i) skilled investor service and sales staff,
(ii) call centre facility, (iii) ATM cards, and (iv) nationwide branch network. AHIML believes in accelerating
its growth significantly through investment in human resource, technology and through its physical
presence in various locations across the country and abroad.

4.6    THE SPONSOR
Arif Habib Securities Limited (“AHSL”) is the principal sponsor of AHIML. At present, it holds 62.4% of
the Company’s shares. AHSL is the flagship holding company of the Arif Habib Group, which ranks
amongst the fastest growing financial services providers in Pakistan. The Group holds interests in the
securities brokerage, asset management, investment advisory, commercial banking, commodities, private
equity, cement, real estate, steel, and fertilizer industries.

AHSL has won the Top Companies Award every year since its listing in 2001. It has a very strong brand
franchise built over years of first rate services to clients and value addition for all stakeholders.

4.7    GROUP OVERVIEW
The Arif Habib Group ranks amongst the fastest growing financial services providers in Pakistan. The
Group holds interests in the securities brokerage, investment and financial advisory, investment
management, commercial banking, commodities, private equity, cement, real estate, steel, and fertilizer
industries. Several of the Group operations are synergetic and complementary.

The Arif Habib Group, through independent entities, operates across the financial services industry:

 Name of Group Company                                    Industry / Major Business
 Arif Habib Securities Limited                            Investments & Holding Company
 Arif Habib Bank Limited                                  Commercial Banking
 Arif Habib Investment Management Limited                 Asset Management
 Arif Habib Limited                                       Securities Brokerage & Corporate Finance
 Pakistan Private Equity Management Limited               Private Equity
 Arif Habib DMCC                                          Commodities Brokerage




                                                       -16-
Offer for Sale of Ordinary Shares
Arif Habib Investment Management Limited




4.8   FUTURE PROSPECTS
AHIML plans to keep bringing new products to market, add value by providing a variety of investment
options along the risk spectrum and tailoring funds to meet diverse investors’ needs.

Strategic funds are planned for investors with a higher threshold for risk. These funds will provide exposure
to specific segment/sectors of the stock market and provide investors an opportunity to match their risk and
return profiles to a variety of available funds.

In the long run, the Company plans to sustain high margins through expansion of its domestic and
international distribution. AHIML has setup a strong branch network across various cities in Pakistan to
ensure that the products are easily accessible.

AHIML is also exploring opportunities in the international market to find new regions for its products and
diversify its client base. The Company has recently made distribution arrangements in United Arab
Emirates, to broaden potential clientele and to invite them to share the profitability of the funds under
management. The focus of this exercise is to identify markets of favorable regulatory environment, strong
appetite for asset management products, liberal exchange rate regime, and international corporate and audit
practices. The Company has entered into an agreement with National Bank of Fujairah for distribution of
units of its mutual funds in UAE, specially targeting non-resident Pakistanis. The Development of new
regional markets will also help significantly in enhancing assets under management which will then be
channeled to the local markets.

4.9   RISK FACTORS
The Offerors wish to highlight the following risk factors, which may affect the returns on investment in the
Company:

Political risk
Though Pakistan has been one of the fastest growing economies in South Asia, internal political instability
and volatile geo-political situation of regional environment can pose challenges for its economic growth,
capital markets and foreign portfolio investments.

Mitigant: AHIML has in place stringent risk management measures to reduce any risk arising due to geo
political conditions. The portfolio diversification, future expansion plans, introduction of innovative
products, and strong historical performance – irrespective of various economic phases – indicates sound
performance capability of the Company.

Interest rate risk
Investments in money market instruments are exposed to interest rate risk. Interest rate fluctuations may
affect the yield on these instruments.

Mitigant: The Company’s fixed income fund managers are managing the interest rate risk of fixed rate
instruments, with a proactive asset allocation strategy.

Regulatory risk
Changes in the regulatory environment may adversely affect the Company’s operations and/or profitability.
Also, levy of capital gain tax may have a negative impact on the funds’ profitability.

Mitigant: The Company has in place strong internal financial and operational systems that monitor and pre-
empt any violation of the regulatory parameters and to maintain standards of best practice.

Liquidity risk



                                                    -17-
Offer for Sale of Ordinary Shares
Arif Habib Investment Management Limited


This risk arises if the Company fails to settle its obligations due to inadequate availability of liquid assets.
Liquidity risk also entails less availability of shares volume in the secondary market when the investors are
unable to sell the shares.

Mitigant: The Company has a current ratio of 2.3 as on December 31, 2007, which illustrates prudent risk
management policies and its ability to secure financing on favorable terms and to settle its obligations
effectively. Moreover, as the shares are proposed to be listed on the Karachi Stock Exchange (G) Limited, the
largest and most liquid stock market of the country, this risk is fairly mitigated.




                                                      -18-
Offer for Sale of Ordinary Shares
Arif Habib Investment Management Limited


Inflation risk
An unexpected increase in inflation may lead to a decrease in the real return of the investors.

Mitigant: The expected inflation is not going to be a serious risk to the operations of the company.

Operational risk
Operational risk is the risk of loss resulting from inadequate or failed internal processes, people and systems,
or from external events.

Mitigant: The Company has a defined structure that comprises of periodic review of procedures, systems,
contingency plans, segregation of duties, internal control, and other sound operating practices that help the
Company to mitigate the operational risk.

Competition risk
The Company may be affected by increasing competition in the industry. The stiffening competition may
lead to low market share and hence reduce growth in assets under management.

Mitigant: The Company has put in place long term strategic plan to sustain its growth. Key factors include
enhancement of sales force, geographical outreach, international distribution channels, exploitation of brand
franchise, and cross selling avenues with other group companies.

Risk of decrease in profit as a result of decrease in the size of NAV of the funds under management
As the management fee is based on average NAV of the funds, the Company’s profits may decline with the
decreases in the size of NAV of the funds under management.

Mitigant: The Company has gathered a team of highly qualified professionals to manage the mutual funds.
The team possesses the required market savvy, business acumen and expertise to manage funds diligently.
The Company also has an in-house research department which conducts in-depth analysis and forecasts on
different sectors of the economy, enabling the fund managers to invest prudently.

Capital market risk
The Company will be listed at the Karachi Stock Exchange and the shareholders will be able to sell or buy
shares only through the KSE. The share price movement of the Company will depend upon the behavior of
the stock market and performance of the Company.

Mitigant: AHIML has a stable performance track record and earning stream. Further, the expansion of its
asset management business by market penetration and proposed regional expansion are likely to ensure the
growth momentum of the Company, enabling it to create value for its stakeholders.

IT IS STATED THAT ALL MATERIAL RISK FACTORS WITH RESPECT TO THIS OFFER
HAVE BEEN DISCLOSED AND NOTHING HAS BEEN CONCEALED.




                                                      -19-
Offer for Sale of Ordinary Shares
Arif Habib Investment Management Limited


                                           PART 5

5   FINANCIAL INFORMATION




                                            -20-
Offer for Sale of Ordinary Shares
Arif Habib Investment Management Limited




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Arif Habib Investment Management Limited




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Arif Habib Investment Management Limited




                                           -23-
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Arif Habib Investment Management Limited




                                           -24-
Offer for Sale of Ordinary Shares
Arif Habib Investment Management Limited




MANAGEMENT NOTE:

Subsequent to the audit of financial statements for the period ended December 31, 2007, the Company
has issued 50% interim bonus shares for the financial year ended June 30, 2008, whereby the paid up
capital of the Company has increased to PKR 300,000,000 from PKR 200,000,000. The break up value
after increase in the paid-up capital on the basis of financial statements for the period ended 31
December 2007, will be as under:

                                                           (Rupees)
 Share capital                                          300,000,000
 Unrealized gain on revaluation of investments           98,443,822


                                                 -25-
Offer for Sale of Ordinary Shares
Arif Habib Investment Management Limited


 Unappropriated profit                            269,881,581
                                                  668,325,403
 Number of ordinary shares                         30,000,000
 Break-up value per share                               22.27




                                           -26-
Offer for Sale of Ordinary Shares
Arif Habib Investment Management Limited




                                           -27-
Offer for Sale of Ordinary Shares
Arif Habib Investment Management Limited


5.1   FINANCIAL YEAR
The financial year of the Company commences on the 1st day of July and ends on the 30th day of June of
each year.




                                                 -28-
  Offer for Sale of Ordinary Shares
  Arif Habib Investment Management Limited


                                                     PART 6
  6     MANAGEMENT AND RELATED MATTERS

  6.1    BOARD OF DIRECTORS OF THE COMPANY

Name & Address                          Designation                 Directorship in other companies
                                                                         Arif Habib Bank Limited
                                                                        Pakarab Fertilizers Limited
                                                                      Al Ameera Arif Habib Limited
Mr. Salim Chamdia                                               Essa Textile & Commodity (Pvt.) Limited
14 / 1, 2nd Gizri Street, Phase - IV     Chairman                   Lucky Cotton Mills (Pvt.) Limited
D.H.A., Karachi.                                                 Nooriabad Spinning Mills (Pvt.) Limited
                                                                  NCEL Building Management Limited
                                                                      Sun Textile Mills (Pvt.) Limited
                                                                    Thatta Cement Company Limited
                                                               Pakistan Private Equity Management Limited

                                                                       Arif Habib Securities Limited
                                                                         Arif Habib Bank Limited
                                                                        Pakarab Fertilizers Limited
Mr. Nasim Beg                                                 Real Estate Modaraba Management Co. Limited
F-16 / 6, Block - 4,                   Chief Executive         Pakistan Private Equity Management Limited
Clifton, Karachi.                                                  Al-Abbas Cement Industries Limited
                                                                          Javedan Cement Limited
                                                                    Rotocast Engineering (Pvt.) Limited
                                                                        Worldcall Telecom Limited

Mr. Sirajuddin Cassim                                                 Arif Habib Securities Limited
D-43, Block-9                                                       Platinum Securities (Pvt.) Limited
KDA Scheme No. 5                          Director                DRH Logistics Pakistan (Pvt.) Limited
Kehkashan Clifton, Karachi                                         Sigma Leasing Corporation Limited

                                                              Pakistan Private Equity Management Limited
                                                                      Arif Habib Securities Limited
Mr. Akmal Jameel                                                   Rozgar Microfinance Bank Limited
146-M, Block-2                                                Real Estate Modaraba Management Company
                                          Director                               Limited
P.E.C.H.S
Karachi.                                                                 J.J Media (Pvt.) Limited
                                                                       Protect One (Pvt.) Limited
                                                                        Aisha Steel Mills Limited

                                                                     Arif Habib Securities Limited
Mr. Kashif Habib                                                 Nooriabad Spinning Mills (Pvt.) Limited
86/2, 10th Street, Khayaban-e-Sehar,      Director                 Thatta Cement Company Limited
Phase-V, D.H.A, Karachi                                                Javedan Cement Limited
                                                                  Rotocast Engineering (Pvt.) Limited

Mr. Muhammad Shafi Malik
                                                                                  Nil
House # 48, Street-1                      Director
Sector F-6/3, Islamabad


Mr. Mirza Qamar Beg
64/1, 25th Street                                                                 Nil
                                          Director
Khayaban-e-Badban,
DHA, Phase-V, Karachi.


                                                      -29-
Offer for Sale of Ordinary Shares
Arif Habib Investment Management Limited


6.2   PROFILES OF THE DIRECTORS
6.2.1    Mr. Salim Chamdia
Mr. Chamdia is a Chartered Accountant by profession. He is a former Chairman of the Karachi Stock
Exchange and was the founder Chairman of National Commodity Exchange Limited. During the last several
years, he has actively contributed towards the modernization of the Karachi Stock Exchange.

6.2.2     Mr. Nasim Beg
A chartered accountant by profession, Mr. Nasim Beg is a seasoned professional and one of the leading
figures in the asset management industry of Pakistan. He has been associated with the Group since 2000 and
currently serving as Chief Executive Officer of Arif Habib Investment Management Limited. Mr. Beg has
been responsible for development and growth of the Group’s mutual fund business from conceptual stage.
His successful management and leadership have enabled the business to achieve significant growth on a
sustained basis. Prior to joining the Arif Habib Group, Mr. Beg served National Investment Trust as its
Deputy Chief Executive.

6.2.3    Mr. Sirajuddin Cassim
Mr. Sirajuddin Cassim is a former President of Karachi Stock Exchange and Central Depository Company.
He is a fellow member of Institute of Chartered Accountants of Pakistan.

6.2.4   Mr. Akmal Jameel
Mr. Akmal Jameel is a CFA charter holder and has earned his Masters degree from the London School of
Economics. He is an Executive Director of Arif Habib Securities Limited and also the Chief Executive of
Pakistan Private Equity Management Limited. He has extensive experience in Capital markets both
domestically and internationally.

6.2.5   Mr. Muhammad Kashif
Mr. Kashif has obtained a Bachelors of Commerce degree in 2004 and has also passed modules A, B, C & D
exams of the Institute of Chartered Accountants of Pakistan. In October 2004, he joined M/s. A. F.
Fergusons, Chartered Accountants, for Articleship. He has three years experience as an intern and as a Non-
Executive Director of Arif Habib Securities Ltd.

6.2.6   Mr. Mirza Qamar Beg
Mr. Beg did his Masters from Punjab University and completed his post-graduation studies at Cambridge
University, UK and Harvard University, USA. He joined Civil Service of Pakistan (CSP) in 1968 and rose to
the highest rank of Secretary General of Pakistan. After retiring from the civil service, he served as
Pakistan’s Ambassador in Italy.

6.2.7     Mr. Muhammad Shafi Malik
Mr. Muhammad Shafi Malik holds a Masters degree in Public Administration from Harvard University and
a Masters Degree in Economics from University of Punjab. He has done L.L.B, D.L.L and D.T.L with
distinction and gold medal in Mercantile Law & Labour Laws. He has diversified experience of serving with
distinction in public offices, corporations and institutions of national importance like C.B.R., and EOBI. He
served as Chairman Employees Old Age Benefit (EOBI) for three years before his retirement in March 2005.
Having valuable experience of management, legal consultancy, adjudication, audit and financial
management, he is capable of tendering advice on administrative, legal/corporate affairs, and strategic
planning.

6.2.8    Syed Ajaz Ahmed – Company Secretary
Mr. Ajaz Ahmed has been associated with the Group since 2001 and is currently serving as Chief Finance
Officer and Company Secretary of Arif Habib Investment Management Limited. He has over a decade of
work experience in asset management, audit, and financial consulting. Mr. Ahmed is a Fellow of Institute of
Cost and Management Accountants of Pakistan and also holds a degree in law.




                                                    -30-
Offer for Sale of Ordinary Shares
Arif Habib Investment Management Limited


6.3       AUDIT COMMITTEE
For assurance of quality and compliance with International Standards, AHIML has self imposed an ongoing
compliance audit on a daily basis on the following:

          NBFC Rules 2003, and NBFC Regulations 2007
          Company's own Internal Policies and Processes
          An on-going audit of the daily NAV based pricing

The Audit Report is sent directly to the Trustee, at least once a month.
The audit committee consists of the following members:
- Mr. Salim Chamdia
- Mr. Muhammad Shafi Malik
- Mr. Qamar Beg
- Mr. Akmal Jameel

6.4       OVERDUE LOANS
There are no overdue loans (local or foreign currency) on the Company or its Directors.

6.5       NUMBER OF DIRECTORS
Pursuant to section 174(2) of the Ordinance, the number of directors of a listed company shall not be less
than seven. At present, the Company’s board of directors consists of seven directors.

6.6       DIVIDEND RECORDS OF OTHER LISTED COMPANIES IN WHICH DIRECTORS
          HOLD DIRECTORSHIPS
                Name of companies                 2007          2006         2005         2004          2003
          Arif Habib Bank Limited*               NA**           NA           NA            NA           NA
          Al-Abbas Cement Limited                60%R            Nil          Nil          Nil           Nil
                                                  75%          100%         100%          150%         100%
          Arif Habib Securities Limited
                                                32.22%B       66.66%B       50%B         150%B        33.33%B
          Javedan Cement Limited                   Nil         56.7%          Nil          Nil           Nil
                                                  25%                        15%         12.5%
          Pakistan Premier Fund                                 40%                                   12.5%B
                                                 15%B                       10%B          25%B
          Worldcall Telecom Limited                Nil          15%B          Nil          Nil          Nil
          Sigma Leasing Corporation                              12%         15%
                                                  16%                                     13%             -
          Limited                                               20%R        25%R
          * Arif Habib Bank Limited was formally listed in January 2008
          ** NA – Not applicable

6.7       QUALIFICATION OF DIRECTORS
A director must be a member unless he is a person representing the Government or an institution or
authority that is a member, or is a whole time working director who is an employee of the Company, or a
Chief Executive or a person representing a creditor. In case of directors representing special interests holding
shares of the requisite value, no such share qualification shall be required provided intimation in writing as
to such representation is lodged with the Company within two months of the appointment of such
directors.

6.8       ELECTION OF DIRECTORS
The directors shall comply with the provisions of sections 174 to 178, 180, and 184 of the Ordinance,
relating to the election of directors and matters ancillary thereto. The present directors of the Company
were elected on 07 February, 2008, for a period of three years.




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Offer for Sale of Ordinary Shares
Arif Habib Investment Management Limited


6.9    REMUNERATION OF THE DIRECTORS
As per clause 68 of the Articles of Association of the Company, “the remuneration of the director for
attending the meeting of the Board or any Committee of the Board shall from time to time be determined
by the Directors provided that neither the Chief Executive nor any other Director in whole time
remunerated service with the Company shall be entitled to any payment for attending meetings of the
Board. A director may also be paid all travelling, hotel and other expenses properly incurred by him in
attending and returning from meeting of the Directors or any committee of Directors or General Meeting of
the Company or in connection with the business of the Company”.

6.10   BENEFITS TO THE PROMOTERS AND OFFICERS DURING THE LAST TWO YEARS
No amount of benefit has been paid or given since inception or is intended to be paid or given to any
promoter or to any officer of the Company other than as remuneration for services rendered as whole-time
executives of the Company and such remuneration for services shall be borne by the Company.

6.11   INTEREST OF DIRECTORS
The directors may be deemed to be interested to the extent of fees payable to them for attending board
meetings. The directors performing whole time service to the Company may also be deemed interested in
the remuneration payable to them by the Company. The directors may also be deemed to be interested in,
to the extent of any shares held by each of them in the Company, the dividends to be declared by the
Company.

6.12   INTEREST OF DIRECTORS IN PROPERTY ACQUIRED BY THE COMPANY
None of the directors of the Company has or has had any interest in any property acquired by the
Company since inception or now proposed to be acquired.

6.13   VOTING RIGHTS
The rights and privileges, including voting rights, attached to the ordinary shares of the Company are equal.

6.14   POWERS OF DIRECTORS
The entire control and management of the Company is vested in the board of directors, who may exercise
all such powers that are, by the Ordinance or by the Company’s Articles of Association, required to be
exercised by the Company in general meeting.

6.15   BORROWING POWERS
Subject to the provisions of section 196 of the Companies Ordinance, 1984, the directors may from time to
time at their discretion borrow such sum or sums as they may think fit for the purpose of the Company,
including from any banks or financial institutions and secure the payment or repayment of such sum or
sums in such manner and upon such terms as the directors think fit.

6.16   INDEMNITY
Section 132 of the Company’s Articles of Association reads as follows:
“Every director or officer of the Company and every person employed by the Company as auditor shall be
indemnified out of the funds of the Company against all liabilities incurred by him as such director, officer
or auditor in defending any proceedings whether civil or criminal, in which judgment is given in his favor,
or in which he is acquitted or in connection with any application under Section 488 of the Ordinance in
which relief is granted to him by the court.”

6.17   INVESTMENT IN ASSOCIATED COMPANIES & FUNDS UNDER MANAGEMENT
The Company has not made any investment in any of associated companies nor has any resolution been
passed for investment in associated companies under Section 208 of the Ordinance. The investments in funds
under management as on December 31, 2007, are mentioned below:

                             Fund name                        Amount (PKR)          Percentage


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Offer for Sale of Ordinary Shares
Arif Habib Investment Management Limited


           Open-end fund
           Pakistan Income Fund                                1,006,848        0.17%
           Pakistan Stock Market Fund                            800,204        0.14%
           MetroBank Pakistan Sovereign Fund                     636,342        0.11%
           Pakistan International Element Islamic
                                                                 126,143
           Fund                                                                 0.02%
           Pakistan Capital Market Fund                       15,656,775        2.72%
           Closed-end fund
           Pakistan Capital Protected Fund – 1                28,860,000        5.01%
           Pakistan Premier Fund Limited                     216,820,212       37.62%
           Pakistan Strategic Allocation Fund                128,555,700       22.30%
           Pension Scheme
           Pakistan Pension Fund                              93,297,000       16.19%
           Pakistan Islamic Pension Fund                      90,597,000       15.72%
           TOTAL                                             576,356,224

6.18   INVESTMENT IN SUBSIDIARY COMPANIES
The Company has not sponsored nor acquired any subsidiaries nor has any resolution been passed for
sponsoring or acquiring any subsidiaries under section 208 of the Ordinance.




                                                    -33-
Offer for Sale of Ordinary Shares
Arif Habib Investment Management Limited


                                                   PART 7
7     MISCELLANEOUS

7.1    REGISTERED OFFICE / HEAD OFFICE
        2/1, R.Y. 16, Old Queens Road
        Karachi - 74000.
        Phone: (021) 111 468 378
        Fax: (021) 247 0351
        Website:www.arifhabib.com.pk

7.2    BANKERS TO THE OFFER
         Arif Habib Bank Limited
         Bank Alfalah Limited
         Bank Al Habib Limited
         Deutsche Bank AG
         Faysal Bank Limited
         Habib Bank Limited
         Habib Metropolitan Bank Limited
         JS Bank Limited
         MCB Bank Limited
         Soneri Bank Limited

7.3    AUDITORS OF THE COMPANY
        M. Yousuf Adil Saleem & Co.
        Chartered Accountants
        Cavish Road, A-35, Block 7 & 8
        KCHSU, Shahra-e-Faisal,
        Karachi, Pakistan.
        Phone: (021) 111-55-2626
        Fax: (021) 454 1314

7.4    LEGAL ADVISOR TO THE COMPANY
        Bawany & Partners
        404, 4th Floor, Beaumont Plaza
        Beaumont Road, Civil Lines
        Karachi – 74200
        Phone: (021) 5657658

7.5    LEGAL ADVISOR TO THE OFFER
        Mohsin Tayebaly & Co.
        2nd floor, Dime Centre, BC-4, Block-9
        Kehkashan, Clifton, Karachi.
        Phone: (021) 537 5658
        Fax: (021) 587 0240
        Website: www.mtclaw.com.pk

7.6    COMPUTER BALLOTER & SHARE REGISTRAR
        M/s. Noble Computer Services (Pvt.) Limited
        2nd Floor, Sohni Centre, BS 5 & 6, Main Karimabad
        Block-4, Federal B. Area, Karachi.
        Phone: (021) 680 1880 – 82 & 680 2326
        Fax: (021) 680 1129
        Website: www.noble-computers.com


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Offer for Sale of Ordinary Shares
Arif Habib Investment Management Limited


7.7      CONSULTANT TO THE OFFER
          Arif Habib Limited
          2/1, R. Y. 16,
          Pardesi House, Old Queens Road,
          Karachi.
          Tel: (021) 241 5213
          Fax: (021) 242 9653
          Website: www.arifhabibltd.com

7.8      MATERIAL CONTRACTS
7.8.1     Underwriting agreements:
S. No.     Name of the underwriter                    No. of shares     Amount (Rs.)            Date
   1.      Allied Bank Limited                            2,000,000      250,000,000      17 May 2008
   2.      First Dawood Investment Bank                                                   17 May 2008
           Limited                                          2,000,000     250,000,000
  3.       Habib Bank Limited                               1,200,000     150,000,000     17 May 2008
  4.       AHM Securities (Pvt.) Limited                    1,200,000     150,000,000     16 May 2008
  5.       Intermarket Securities (Pvt.) Limited            1,100,000     137,500,000     16 May 2008
                                          TOTAL             7,500,000    937,500,000


7.8.2     Due diligence reports:
S. No.      Name of the underwriter
   1.       Allied Bank Limited
   2.       First Dawood Investment Bank Limited
   3.       Habib Bank Limited
   4.       AHM Securities (Pvt.) Limited
   5.       Intermarket Securities (Pvt.) Limited


7.8.3     Other contracts and agreements:
Long term loan:
 Institution                  Allied Bank Ltd
 Amount                       PKR 200,000,000
 Tenor                        5 years including a grace period of one year
 Security                     Pledge of units of various mutual funds
 Expiry                       September 30, 2008 (Annual review)
 Nature                       Demand Finance Facility
                              A long term financing facility amounting PKR 83 million obtained from bank
                              which is subject to mark-up rate of 6 month’s KIBOR plus 1.5% per anum. The
                              principal amount of the loan is repayable in half yearly instalments
 Current status
                              commencing from December 2008. Mark up is payable on half yearly basis.
                              The loan is secured against pledge over units of various mutual funds with 40%
                              margin held and owned by the Company and its sponsors.

 Lease facility:
 Institution                  Orix Leasing Pakistan Limited
 Amount                       PKR 6,280,080
 Expiry                       August 2009
 Financing rate               9.1%
                              This represents vehicle acquired under finance lease from a leasing company.
 Current status               Overdue rental are subject to additional charge at the rate of 0.1% per day. The
                              Company intends to exercise its option to purchase the above asset upon

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Offer for Sale of Ordinary Shares
Arif Habib Investment Management Limited


                          completion of the lease.

 Distribution contract:
 Institution              Standard Chartered Bank
 Nature                   Distributor
                          Non-exclusive distributor of the units of mutual funds and related investment
 Purpose
                          plans managed by the Company

 Institution              Arif Habib Bank Limited
 Nature                   Distributor
                          Non-exclusive distributor of the units of mutual funds and related investment
 Purpose
                          plans managed by the Company

 Institution              American Life Insurance Company
 Tenor                    Indefinite
 Nature                   Trailer Fee

 Institution              National Bank of Fujairah
 Nature                   Distributor in UAE
                          Non-exclusive distributor of the units of mutual funds and related investment
 Purpose
                          plans operated by the Company in UAE

 Institution              Bank AL Habib Limited
 Nature                   Distributor
                          Non-exclusive distributor of the units of mutual funds and related investment
 Purpose
                          plans operated by the Company

 Institution              Allied Bank Limited
 Nature                   Distributor
                          Non-exclusive distributor of the units of mutual funds and related investment
 Purpose
                          plans operated by the Company

 Rental contract:
 Party                    A. Ghaffar Ibrahim
 Monthly Rent             PKR 25,000
 Security Deposit         150,000
 Effective Date           15th March 2008
 Tenor                    Eleven months
 Nature                   Rent Agreement - Business Centre office

 Party                    Mrs. Farah Khan
 Monthly Rent             PKR 59,400
 Security Deposit         165,000
 Effective Date           01 July 2007
 Tenor                    Eleven months
 Nature                   Rent Agreement - Lahore office

 Party                    Ms. Aymen Farooq
 Monthly Rent             PKR 16,104
 Security Deposit         8,000
 Effective Date           01 March 2008
 Tenor                    Twelve months
 Nature                   Rent Agreement - Multan office


                                                 -36-
Offer for Sale of Ordinary Shares
Arif Habib Investment Management Limited


7.9    INSPECTION OF DOCUMENTS AND CONTRACTS
Copies of the Memorandum and Articles of Association, audited financial statements, material contracts, and
auditors’ certificates referred to in this OFSD may be inspected during the usual business hours on any
working day at the registered office of the Company from the date of publication of this OFSD until the
closing date of the subscription list.

7.10   LEGAL PROCEEDINGS
There are no legal proceedings pending against the Company and the Company has not initiated any legal
proceedings against any party or person.

7.11   VENDORS
There are no vendors in terms of clause 12 of part 1 of the second schedule of the Companies Ordinance,
1984.

7.12   MEMORANDUM OF ASSOCIATION
The Memorandum of Association, inert alia, contains the objects for which the Company was incorporated
and the business, which the Company is authorized to undertake. A copy of the Memorandum of
Association is annexed to this OFSD and with every issue of this OFSD except the one that is released in
newspapers as advertisement.

7.13   CAPITALIZATION OF PROFITS
The Company has capitalized profits of PKR 250,000,000 by issue of bonus shares during the preceding
years.




                                                   -37-
Offer for Sale of Ordinary Shares
Arif Habib Investment Management Limited


                                                  PART 8

8     APPLICATION AND TRANSFER INSTRUCTIONS

8.1     Eligible investors include Pakistani citizens resident in Pakistan, companies, bodies corporate and
        other legal entities incorporated or established in Pakistan (to the extent permitted by their
        constitutive documents and existing regulations as the case may be); provident / pension/gratuity
        funds / trusts (subject to the terms of their trust deeds, and existing regulations) and branches in
        Pakistan of companies and bodies corporate incorporated outside Pakistan.

8.2     Copies of this OFSD and applications forms can be obtained from members of the Karachi Stock
        Exchange, the bankers to the offer and their branches and the registered office of the Company.
        The offer document and the application form can also be downloaded from the following website:
        www.arifhabib.com.pk

8.3     APPLICATION MUST BE MADE ON THE OFFERER’S APPLICATION FORM OR A
        LEGIBLE COPY THEREOF.

8.4     Applicants opting for shares in scripless form are required to complete the relevant sections of the
        application. In accordance with the provisions of the Central Depositories Act, 1997 and the CDC
        regulations credit of shares in book entry form is allowed ONLY in the applicant’s own CDC
        account. In case of discrepancy between the information provided in the application form and the
        information already held by the CDC, the Company reserves the right to issue shares in physical
        form.

8.5     Names and addresses must be written in block letters, in English and should not be abbreviated.

8.6     (i)     An attested copy of the computerized NIC (“CNIC”) should be enclosed and the CNIC
                number indicated against the name of the applicant. Copies of CNIC can be attested by
                any Federal/Provincial Government gazetted officer, Councilor, Bank Manager, Oath
                Commissioner, or Head Master of High School etc.

        (ii)    Original CNIC, along with one attested copy, must be produced for verification to the
                branch at the time of presenting an application. The attested photocopy shall, after
                verification, be retained by the bank branch along with the application

        (iii)   Only one application will be accepted against each account. In case of joint accounts, one
                application will be accepted in the name of each of the joint account holders.

        (iv)    Joint applications by more than four persons shall not be accepted. In case of joint
                application, early party must sign the application form and submit copies of their attested
                computerized National Identity Cards. The share certificates will be dispatched to the
                person whose name appears first on the application form while in case of CDS shares, it
                will be credited to the respective CDS account and where any amount is refundable, in
                whole or in part, the same will be refunded by cheque by post, or through the bank where
                application was lodged, to the person named first on the application form, without interest
                profit or return.
        (v)     Applications by Companies etc.:

                (a) Applications made by companies, corporate bodies, provident / pension / gratuity
                    funds / trusts and other legal entities must be accompanied by a copy of their
                    Memorandum and Articles of Association or equivalent constitutive document. Where
                    applications are made by virtue of a Power of Attorney, the Power of Attorney must
                    be attached to the Application Form. Copies of documents can be attested by any
                    Federal / Provincial Government gazette officer, Councilor, Bank Manager, Oath
                    Commissioner, or Head Master of High School etc.

                                                   -38-
Offer for Sale of Ordinary Shares
Arif Habib Investment Management Limited



                (b) Attested copies of the documents mentioned in this section must be produced along
                    with originals for verification to the branch at the time of presenting an application.
                    The attested copies shall, after verification, be retained by the bank branch along with
                    the application.

8.7    Subscription money must be paid by cheque drawn on the applicant’s own account or bank
       draft / pay order payable to one of the bankers to the offer “A/C OFFER FOR SALE OF
       SHARES OF ARIF HABIB INVESTMENT MANAGEMENT LIMITED” and crossed “A/C
       PAYEE ONLY” and must be drawn on a bank in the same town as the bank through which the
       application has been made.

8.8    Applications are not to be made by minors or persons of unsound mind.

8.9    Applicants should ensure that the bank branch, on which their application is drawn, completes the
       relevant portion of the application form.

8.10   Applicants should retain the bottom portion of their application as provisional acknowledgment of
       submission of their application. This may be made available at the time of submission of the
       application form, or may be collected later from the bank branch through which application was
       made. This should not be construed as acceptance of the application or a guarantee that the
       applicant will be allocated the number of shares applied for.

8.11   No receipt will be issued for payment made with an application but an acknowledgement will be
       forwarded in due course by issuance of share certificate in whole or in part or by refund of the
       money in case of unaccepted or unsuccessful applications. No interest or profit shall be payable in
       respect of the refund amount.

8.12   It would be permissible for a Banker to the Offer to refund subscription money to the unsuccessful
       applicants having a bank account in that bank by crediting such account instead of through cheque,
       pay order or bank draft. Applicants should therefore not fail to give their bank account numbers.

8.13   The transfer of shares to successful applicants shall be made in accordance with the criteria disclosed
       in this OFSD subject to the rules of the Securities and Exchange Commission of Pakistan.

8.14   Making of any false statement in the application or willfully embodying incorrect information
       therein will make the applicant or the bank liable to legal action.

8.15   The basis and conditions of allotment to the general public shall be as follows:

       (a)   This offer is being made at a price of Rs. 125/- per share of par value of Rs. 10/- each. The
             offer price includes a premium of Rs. 115/- per share.

       (b)   Applications must be made for 500 shares or in multiples of 500 shares only. Applications,
             which are neither for 500 shares nor for multiples of 500 shares, shall be rejected.

       (c)   The minimum amount of application for subscription of 500 shares both in cases of physical
             transfer and transfer under book-entry system is Rs. 62,500/-. The transfer fee shall be borne
             by the Offerors.

       (d)   Application for shares below the value of Rs. 62,500/- will not be entertained.

       (e)   SUBMISSION OF FICTITIOUS AND MULTIPLE APPLICATIONS (MORE THAN
             ONE APPLICATIONS IN THE NAME OF SAME PERSON) IS PROHIBITED AND
             SUCH APPLICATIONS’ MONEY SHALL BE LIABLE TO CONFISCATION
             UNDER SECTION 18-A OF THE SECURITIES AND EXCHANGE ORDINANCE,

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Offer for Sale of Ordinary Shares
Arif Habib Investment Management Limited


                1969.

       (f)        If the shares to be offered to the general public are sufficient for the purpose to
                accommodate all the applications then, all applications shall be accommodated.
       (g)      If this offer is oversubscribed in terms of number of applications and amount, the shares will
                be allotted by conducting computer balloting in the presence of representatives of the Stock
                Exchange in the following manner:

                i.      If all applications for 500 shares can be accommodated, then all such applications will be
                        accommodated first. If all applications for 500 shares cannot be accommodated, then
                        balloting will be held among the applications for 500 shares only.

               ii.      If all applications for 500 shares have been accommodated, and shares are still available
                        for allocation, then all applications for 1,000 shares will be accommodated. If all
                        applications for 1,000 shares cannot be accommodated, then balloting will be held among
                        applications for 1,000 shares only.

              iii.      If all applications for 500 shares and 1,000 shares have been accommodated, and shares
                        are still available for allocation, then all applications for 1,500 shares will be
                        accommodated. If all applications for 1,500 shares cannot be accommodated, then
                        balloting will be held among applications for 1,500 shares only.

              iv.       If all applications for 500, 1,000 and 1,500 shares have been accommodated, and shares
                        are still available for allotment, then all applications for 2,000 shares will be
                        accommodated. If all applications for 2,000 shares cannot be accommodated, then
                        balloting will be held among applications for 2,000 shares only.

               v.       After the allotment in the above mentioned manner, the balance shares, if any, will be
                        allotted in the following manner:

                            1.   If the remaining shares are sufficient to accommodate each application for over
                                 2,000 shares, then 2,000 shares will be allotted to each applicant and the
                                 remaining shares will be allotted on a pro-rata basis.

                            2.   If the remaining shares are not sufficient to accommodate all remaining
                                 applications for at least 2,000 shares, then balloting will be conducted for
                                 allocation of 2,000 shares to each successful applicant.

       (h)      If the offer is over subscribed in terms of amount only, then the allocation of shares will be
                made in the following manner:
              i. First preference will be given to applicants who applied for 500 shares;

             ii. Next preference will be given to applicants who applied for 1,000 shares;

             iii. Next preference will be given to applicants who applied for 1,500 shares;

             iv. Next preference will be given to applicants who applied for 2,000 shares;

                After allocation in the above manner, the balance shares, if any, will be allotted on pro-rata
                basis to the applicants who applied for more than 2,000 shares.

       (i)      In case the offer is undersubscribed, all the applicants whose applications are accepted will be
                allotted shares applied for and the remaining shares will be taken up by the underwriters in
                proportion to their respective underwriting commitments.


                                                         -40-
Offer for Sale of Ordinary Shares
Arif Habib Investment Management Limited


       (j)     In addition to the above, employees of the Company have been given preferential allocation of
               375,000 shares in the Offer for Sale of shares, to which they will subscribe on the public
               subscription days.

       (k)     Every permanent employee of the company is entitled to participate in the employee quota of
               public offer.

       (l)     No advance will be given by the company to the employees to apply for subscription of
               shares.

       (m) The basis of allotment of shares out of the quota allocated to employees shall be the same as
           for the general public

       (n)     In case the offer to the employees is undersubscribed, then the remaining shares will be
               allocated to the general public

       (o)     Incase both offer to the employees and to the general public is undersubscribed; all the
               remaining shares shall be taken up by the underwriters in proportion to their respective
               underwriting commitments.
       (p)     Allocation of shares will be subject to the scrutiny of the applications.

8.16   Bankers to the Offer

             Code No.     Bank
                 1)       Arif Habib Bank Limited
                 2)       Bank Alfalah Limited
                 3)       Bank Al Habib Limited
                 4)       Deutsche Bank AG
                 5)       Faysal Bank Limited
                 6)       Habib Bank Limited
                 7)       Habib Metropolitan Bank Limited
                 8)       JS Bank Limited
                 9)       MCB Bank Limited
                 10)      Soneri Bank Limited

8.17   Code of occupation
             Code No.            Occupation                   Code No.            Occupation
               01.                  Business                    06.               Professional
               02.             Business Executive               07.                 Student
               03.                  Service                     08.               Agriculturist
               04.                Housewife                     09.               Industrialist
               05.                Household                     10.                  Other




                                                       -41-
Offer for Sale of Ordinary Shares
Arif Habib Investment Management Limited


                                                  PART 9


9    SIGNATORIES TO THE OFFER FOR SALE DOCUMENT


                             Sd/-
         1.        ________________________
                   Salim Chamdia




                             Sd/-
         2.        ________________________
                   Nasim Beg


Signed by the above in the presence of witness:



                      Sd/-
         ________________________
         Ali Ahmed Khan
         2/1, R. Y. 16, Old Queens Road,
         Karachi.
         NIC #: 42301-0936465-3




Date:    ____________
Place:   Karachi




                                                   -42-
Offer for Sale of Ordinary Shares
Arif Habib Investment Management Limited



10     MEMORANDUM OF ASSOCIATION


                             THE COMPANIES ORDINANCE, 1984


                              MEMORANDUM OF ASSOCIATION

                                                       OF

                 ARIF HABIB INVESTMENT MANAGEMENT LIMITED


I.       NAME

         The name of the Company is "ARIF HABIB INVESTMENT MANAGEMENT LIMITED"

II.      REGISTERED OFFICE

         The Registered Office of the Company will be situated in the province of Sindh.

III.     OBJECTS

         The objects for which the Company is established are: -

1.       Subject to and in accordance with all applicable laws, rules and regulations, and in particular the
         Non-Banking Finance Companies (Establishment and Regulation) Rules, 2003, (hereinafter referred
         to as "the Rules" which shall mean and include any amendments and/or substitutions thereof), to
         carry on the business of asset management company for providing asset management services and
         the business of investment adviser for providing investment advisory services and to constitute,
         float and manage open-ended schemes and closed-end schemes under trust deeds and issue
         redeemable securities, to act as investment adviser/fund manager to investment companies and to
         generally carry on the business of unit trusts, mutual funds and pension funds, asset management
         and fund management and to organize, promote, form, create, establish, support, manage, operate
         and administer unit trusts and mutual funds schemes of any type or character, and to act as the
         management company for open-end unit trusts and investment adviser/fund manager for closed-end
         mutual funds and pension schemes and to offer, issue, sell, hold, repurchase and accept the
         surrenders of units and mutual fund certificates to the local and foreign private and public investors,
         including institutions, companies, agencies, statutory corporations, entities, government and semi
         government institutions and trusts.

2.       Subject to and in accordance with the Rules and other applicable laws, rules and regulations, to
         undertake and carry on the business of investment finance company, and to provide investment
         finance services as outlined in Rule 14 of the Rules, including but not limited to Money Market
         Activities, Capital Market Activities, Project Finance Activities, Corporate Finance Services, and
         other General Services and Activities as broadly categorized in Rule 14 of the Rules and any
         modifications, substitutions and replacements thereof from time to time, including any ancillary or
         incidental services permissible under the Rules and any other laws, rules and regulations in force
         from time to time.

3.       Subject to and in accordance with the Rules and other applicable laws, rules and regulations, to
         carry on and undertake the business of leasing and lease operations of all kind, including financial
         leases and operation leases; purchasing, selling, hiring or letting on rentals or hire all kinds of plant,
         machinery, equipment, vehicles, appliances, aircrafts, ships, consumer, commercial and industrial

                                                       -43-
Offer for Sale of Ordinary Shares
Arif Habib Investment Management Limited


       properties of every kind capable of being leased to the Company’s customers; to provide assistance
       to customers for the acquisition thereof; to deal in all such movable and immovable properties for
       the purpose of leasing and to provide leasing and advisory and counseling services; to carry on and
       undertake the business of hire purchase, purchasing, selling on hire purchase of all kinds of movable
       and immovable properties, within scope of the leasing policy of the Company to be determined by
       the Board from time to time and to undertake all ancillary and incidental transactions, services and
       activities within the parameters of the Rules and other applicable laws, rules and regulations.

4.     Subject to and in accordance with the Rules and other applicable laws, rules and regulations, to
       carry on the business of and to operate as a venture capital company and to make investments in
       venture projects, as defined in the Rules, including projects, which may be in the start-up phase of
       business or commercial operations or undergoing expansions or engaged in service, manufacturing
       or production activities based on new processes, services or technologies or located in remote under
       developed areas, including wholly owned subsidiaries of the Company, through equity or other
       instruments, whether convertible into equity or not; to provide managerial and technical expertise
       to venture projects; to act as management company for management of venture capital funds; to
       receive or arrange funds for investments in venture projects through private placements of
       permissible securities; to prepare, submit and issue placement memorandums to the authorities and
       investors, and to generally invest in the capital of other companies and/or for the purchase or upon
       security of shares stocks, debenture stocks, bonds, mortgages, obligations and securities of any kinds
       issued or guaranteed by companies, corporations, firms and/or federal, local or provincial
       government, municipal or local authorities or bodies corporate whatsoever; to enter into fund
       management agreements with them or any of them for the purposes of managing the funds and
       investments of the Company and generally to make investments in and/or to collaborate or
       participate under any financial, joint venture or other arrangements with all or any of the above.

5.     Subject to and in accordance with the Rules and other applicable laws, rules and regulations, to
       carry on the business of discount, acceptance and guarantee house by issue, purchase, sale, distribute
       arrangement accept, co-accept, discount, rediscount, recourse discount, underwrite and guarantee of
       securities. certificate of investments certificate of deposit, commercial paper, participation term
       certificate, term finance certificate, bonds and bills of exchange, hundies, promissory notes,
       coupons, drafts, bills of lading, railway receipts, warrants, debentures, whether local or foreign or
       any financial instrument issued in and outside Pakistan by any government or any authority or
       body corporate, entity corporation, association, persons, whether in public or private sector, both
       in primary or secondary market or money market to purchase receivables and book debts to
       manage cash and funds for others, to borrow with or without security in any currency from any
       source, to negotiate loans and to act as primary dealer, market maker, agent and broker in
       government debt instruments and other securities; to carry on the business of guarantee house by
       issuing guarantees on the security of assets of companies, entities, establishments whether in or
       outside Pakistan desirous of obtaining guarantee in respect of their arrangements whether financial
       or otherwise to be furnished or extended in or outside Pakistan.

6.     Subject to and in accordance with the Rules and other applicable laws, rules and regulations, to
       carry on the business of providing housing finance services as permissible under the Rules and any
       other applicable laws, rules and regulations and in this connection, to provide long-term finance for
       the purpose of constructing, purchasing or making any additions, alterations of improvement to or
       in any property; to lease and rent on hire purchase basis buildings for residential and commercial
       purposes; to establish and manage housing schemes or work as subsidiary or holding company or as
       joint venture of construction business; to carry out surveys and valuations of lands and properties;
       to arrange for the insurance or charged property from the present approved insurance companies;
       to manage, mortgaged investments as agents; to manage public or private sector projects, in the
       housing and urban development sectors; to make loans and advances for house building or non-
       residential properties to individuals, corporations, housing companies, including project financing;
       to provide financing against existing property by way of mortgage, provided that the same property
       shall not be accepted as security unless the facility extended is settled to raise funds, in addition to
       share capital from commercial paper, any security and deposits of not less than thirty days maturity

                                                    -44-
Offer for Sale of Ordinary Shares
Arif Habib Investment Management Limited


       approved by the Commission; foreign debentures both short and long-term; issuance of redeemable
       capital (participation term certificates or term finance certificates, etc.); lines of credit; re-discount
       facilities; loans on mark-up to other NBFCs, providing housing finance services; making investment
       in government securities, approved securities and such other approved modes as may be allowed to
       the Company from time to time and generally to undertake fulfill and effectuate all ancillary and
       incidental transactions and activities relating to housing finance services.

7.     Subject to and in accordance with the Rules and other applicable laws, rules and regulations, the
       Company’s operating policies in relation to the Company’s asset management and investment
       advisory business, leasing business, business of investment finance company, venture capital
       business, discount business and housing finance business shall be in consonance with the prevailing
       laws, rules and regulations and shall be subject to review and modifications from time to time by
       the Directors periodically so as to keep the same in consonance with the changing investment and
       economic environment, market conditions and forces and the changes in the applicable laws, rules
       and regulations.

8.     To constitute trusts with a view to issue units, stocks, securities, certificates, or other documents,
       based on or representing any or all assets appropriated for the purposes of any such trust and to
       settle and regulate any such trust and to issue, hold or dispose of any such units, stocks, securities,
       certificates or documents.

9.     To appoint, remove, replace and remunerate custodians, trustees, advisers, registrars, transfer
       agents, investment facilitators, distributors and distribution companies, selling agents, brokers,
       consultants, research analysts, fund managers, service providers, advisers and agents and to create
       and form trusts and agencies for appointment of trustees and custodians for investments and fund
       management, inter alia the offer, issuance, sale, re-purchase, encashment and supervision of the units
       and mutual funds certificates and schemes and for the overall investment, motivation and
                custody, management and deployment of the funds; to provide all necessary and requisite
       management, supervision and administrative functions and back-up support thereof, in accordance
       with the prevailing laws, rules and regulations in Pakistan, and to remunerate such trustees,
       custodians, advisers, fund managers, investment facilitators, distributors and              distribution
       companies, registrars, transfer agents, service providers, advisers and agents at fixed remuneration or
       on the basis of percentages or otherwise and on such terms and conditions as the Directors may
       deem fit, subject to the Rules and the conditions as may be laid down by the Securities & Exchange
       Commission of Pakistan (hereinafter referred to as "the Commission").

10.    To act as trustees, custodians, advisers, fund managers and agents for managing, operating,
       administering and supervising other open-end and closed-end unit trusts and mutual funds in
       accordance with the directions and policies of the management companies covered under purview
       of relevant sections of law and the constitutive documents for such remuneration or considerations
       and on such terms and conditions as the Directors may deem appropriate.

11.    Subject to the Rules and such other Acts, Ordinances, Schemes, Rules Regulations and Directions
       as may from time to time be issued and be applicable to the Company or any other law for the time
       being in force to provide investment advisory services on a discretionary basis or otherwise with
       respect to securities and investment instruments related to such securities and to provide or assist in
       providing any professional, financial, investment, technical and managerial advise or assistance with
       respect to securities and investment instruments.

12.    To carry on the business as dealers of and to buy, sell, hold, acquire or invest the capital and funds
       of the Company in securities and investments of every kind and description including but not
       limited to shares, stocks, fixed income securities, modaraba certificates, musharika certificates,
       participation term certificates, term finance certificates, mutual fund certificates, units, certificates of
       investments, commercial papers, debentures, debenture stocks, bonds, obligations or securities
       issued or guaranteed in Pakistan or abroad, by any company incorporated or registered in Pakistan


                                                      -45-
Offer for Sale of Ordinary Shares
Arif Habib Investment Management Limited


       or in any foreign country, by any Government or Public body or Authority, supreme, municipal,
       local or otherwise, both for short term as well as for long term gains and to realise such gains.

13.    To act as dealers, brokers, traders, investors or agents for or in respect of any investments or
       securities whatsoever without carrying on the business of banking or insurance.

14.    To purchase, subscribe for, borrow, acquire, hold, own, sell, exchange, assign, transfer, mortgage,
       pledge, hypothecate, guarantee, deal in and otherwise effect all transactions of every kind in respect
       of or in relation to all kinds of securities and investments.

15.    To carry on business as dealers in foreign exchange and to buy, sell and deal in foreign exchange
       notes and currencies, subject to approval of State Bank of Pakistan.

16.    To render advisory, investigative, supervisory, managerial, investment and other services of every
       kind and description.

17.    To invest or deal with the moneys of the Company not immediately required for its operations in
       such manner as the Directors may think fit.

18.    To purchase, re-purchase, issue, sell, distribute, arrange, accept, co-accept, discount, re-discount,
       underwrite, sub-underwrite and guarantee securities, shares, certificates of investments, certificates
       of deposit, commercial papers, participation term certificates, term finance certificates, bonds, bills,
       letters of right, warrants, global depository receipts (GDRs) or any financial instrument issued in
       and outside Pakistan by any Government or any authority or body corporate, entity, corporation,
       association or person, whether in public or private sector both in primary and secondary markets
       or money markets and to purchase receivables and book debts, to manage cash and funds for others,
       to borrow with or without security in currency from any source, to negotiate loans, to undertake
       portfolio management, advisory and consultancy services and to act as a primary dealer, market
       maker, agent and broker in Government debt instruments and other securities.

19.    To manage investment portfolios on behalf of companies, firms, trusts, governments, semi-
       governments institutions, statutory corporations, agencies, institutions, bodies corporate, entities
       and individuals and for this purpose to open and maintain investor's deposit accounts, make
       advances for purchase of shares, securities and investments to and on behalf of investors and account
       holders, to engage in business of investing and re-investing in and the owning and holding of shares,
       securities and investments, to help in generally broadening the base of investments and encouraging
       investments in sound projects, to provide professional counseling, regarding investments and to act
       in any manner as a principal or agent in all matters relating to shares, securities and investments,
       without engaging in the business of banking, Modaraba, leasing, or an investment company.

20.    To issue any securities which the Company has power to issue for any purpose by way of security
       or indemnity or in satisfaction of any liability undertaken or agreed to be undertaken by the
       Company.

21.    To invest and deal with the monies and other assets of the Company not immediately required for
       the purposes of the business of the Company in or upon such investments and in such manner as
       the Board of Directors may from time to time think fit.

22.    To procure the registration or incorporation of the Company in or under the laws of any territory
       outside Pakistan and for the offer, subscription, issuance, indemnity and listing of its shares, mutual
       fund certificates, units and securities in Pakistan as well as in any other country of the world,
       subject to the compliance with all applicable laws, rules and regulations in Pakistan as well as of
       such foreign country.

23.    To act as brokers for call money and foreign exchange of any or all scheduled banks and financial
       institutions both local and foreign, operating in Pakistan and to act as moneychangers and dealers of

                                                    -46-
Offer for Sale of Ordinary Shares
Arif Habib Investment Management Limited


       foreign exchange without engaging in banking business subject to approval of State Bank of
       Pakistan.

24.    To underwrite, manage and distribute the issue of stocks, shares, bonds, debentures, debenture
       stocks, modaraba certificates, mutual fund certificates, units and other securities either directly or
       jointly with one or more of its constituent institutions or other investment or financial institutions.

25.    To operate, conduct, accomplish and establish services for or relating to financial, consultancy,
       management services, trading and other activities including research programs, systems analysis,
       electronic data processing for industrial, trading and commercial activities.

26.    To take part in the management, to manage and act as consultants and advisors to the business of
       other shares and stock brokers on fees, commission or such other basis or to enter into partnership
       joint venture agreements on profit and loss sharing basis.

27.    To acquire and secure membership, seat or privilege either in the name of the Company or its
       nominee or nominees in and of any association, stock exchange, market, club or other institution in
       Pakistan or any part of the world for furtherance of the business of the Company.

28.    To act as Registrar of shares for companies or/and to provide corporate advisory, secretarial and
       other relevant services subject to prevailing policy of Securities and Exchange Commission of
       Pakistan.

29.    To pre-qualify and register with the federal, provincial and local governments, statutory bodies,
       institutions and agencies for rendering and binding in respect of quotations and tenders for foreign
       currencies, certificates, securities and bonds as may be permissible under the law.

30.    To publish for sale or otherwise business reports on the general economy and various
       sector/industries, credit ratings for companies and individuals, stocks indices, stock market trends
       and other such information.

31.    To form, promote, subsidies and assist companies and partnerships, to promote and acquire any
       concern as a running business or otherwise purchase any part of the assets of any concern or any
       company or any interest or share thereof and to pay for the same, including its goodwill either in
       cash/or by issue of shares or otherwise invest the monies of the Company for the said purposes.

32.    To apply for and to obtain assistance (financial, technical or of any other type) from Government
       and other organisations, companies, firms or individuals, national or international, for developing
       all or any of the business or businesses of the Company.

33.    To undertake management of investments or assets located in different parts of the world including
       portfolios and other investment, contracts and as a special arrangement provide services as trustees
       to manage inheritance and to act as custodians and agents.

34.    To provide technical, economic, financial and administrative consultancy services and prepare
       investment and economic feasibility studies for projects intended to be established and undertake on
       behalf of investors the identification of investment opportunities and evaluation of projects.


35.    To acquire projects and/or participate in projects with others through funds and/or efforts or both
       and to enter in the projects in the capacity of financial, joint venture holder, executor of supply
       contracts, lessors of movable and immovable properties, and for properties for profit on account of
       others but not to act as a leasing company.

36.    To act as trustee under any deeds constituting or securing any debenture stocks, bonds or other
       securities or obligations and to undertake and execute any other trusts, and also to undertake the

                                                    -47-
Offer for Sale of Ordinary Shares
Arif Habib Investment Management Limited


       office of or exercise the powers of executor, administrator, receiver, treasurers, custodians and trust
       corporation.

37.    To act as consultants and advisors to individuals, corporations, firms, trusts, financial institutions,
       government bodies and departments, semi-government institutions, statutory corporation, agencies,
       municipal corporations and other entities, in managing their funds and also to act as an
       intermediary in financial transactions and to receive fees, commissions, profits, or other
       remunerations thereon. In acting as investment advisors, the Company will assist and advice its
       clients in placing their funds for short, medium or long term periods and for this purpose may
       operate discretionary portfolio accounts on behalf of its clients.

38.    To obtain or borrow money in local or in any foreign currency from any person or persons,
       corporations, companies, banks, financial and other entities for carrying on the business of the
       Company including leverage holding on the Company's account or on account of the other
       constituents.

39.    To build, construct, demolish, equip, renovate, alter, improve, work, develop, administer, manage
       or control buildings, structures or facilities of all kinds for the purposes of the Company.

40.    To enter into joint ventures or partnership or into any agreements for sharing profits, union of
       interests, reciprocal concessions, amalgamation or co-operation with any person or persons or
       engage in any business or transaction which the Company is authorized to carry on or engage in
       any business, transaction capable of being conducted so as, directly or indirectly benefit the
       Company and to take or subsidies or otherwise assist any such company, and to sell, hold, reissue,
       with or without guarantee or otherwise deal in such shares or securities and to form, constitute or
       promote any other company or companies for the purpose of acquiring all or any of the property,
       rights and liabilities of the company and to form subsidiary companies.

41.    To lend and advance money or give credit to such persons or companies and on such terms as may
       seem expedient, and in particular to customers and others having dealings with the Company and to
       guarantee the performance of any contract or obligation and the payment of money of or by any
       persons or companies and generally to give guarantees and indemnities.

42.    To sell, lease, turn to account, or grant licences, easements and other rights over, and in any other
       manner deal with or dispose of the undertaking, property, assets, rights, privileges and effects of the
       Company or any part thereof for such consideration as the Board of Directors may determine.

43.    To apply for, purchase or otherwise acquire and protect, prolong and renew whether in Pakistan or
       elsewhere, any patents, patent rights, brevet de’, inventions, trademarks, copyrights, licenses,
       protections, concessions and the like conferring any exclusive or non exclusive or limited right to
       any secret, or other information as to any invention, process or privilege which may seem capable
       of being used for any of the purposes of the Company or the acquisition of which may seem
       calculated directly or indirectly to benefit the Company and to use, exercise, develop, manufacture
       under or grant licences or privileges in respect of or otherwise turn to account the property rights
       and information so acquired and to carry on any business in any way connected therewith.

44.    To pay out of the funds of the Company all expenses, which the Company may lawfully pay with
       respect to the formation and registration of the Company or the issue of its capital or the listing of
       its shares on an exchange, including brokerage fees, listing fees, fees or taxes on the issue of shares,
       and commissions.

45.    Subject to the provisions of the Companies Ordinance, 1984, to distribute among the members in
       specie any property of the Company or any proceeds of the sale or disposal of any property of the
       Company, in the event of winding-up.



                                                    -48-
Offer for Sale of Ordinary Shares
Arif Habib Investment Management Limited


46.    To remunerate the Directors, officials, and employees of the Company or any other person or firm
       or company rendering services to the Company, out of or in proportion to, the returns or profit of
       the Company/or otherwise as the Directors may think proper, either by cash payment or by the
       allotment to him or them of shares or securities of the Company credited as paid up in full or in
       part or otherwise as may be thought expedient.

47.    To establish and maintain or procure the establishment and maintenance of any contributory or
       non-contributory pension or superannuating funds for the benefit of and to give or procure the
       giving of donations, gratuities, pensions, allowances or emoluments to persons who are or were at
       any time in the employment or service of the Company, or of any company which is a subsidiary
       of the Company or is allied or associated with the Company or with any such subsidiary company
       or who are or were at any time Directors or Officers of the Company or of any such other
       company as aforesaid and the wives, widows, families and dependants of any such persons, and also
       establish and subsidies and subscribe to any institutions, including in particular any cafeterias,
       canteens or clubs funds calculated to be for the benefit of or to advance the interests and well-being
       of the Company or its employees as aforesaid and make payments to or towards the insurance of
       any such person as aforesaid and do any of the matters aforesaid, either alone or in conjunction
       with any such other company as aforesaid.

48.    To subscribe or contribute, support, promote, guarantee money for and/or otherwise assist or to
       grant money to charitable, benevolent, religious, scientific, national, public institution, objects or
       purposes or for any useful object or for any purpose which may in the opinion of the Board of
       Directors directly or indirectly further the interests of the Company or of its members, employees
       or Directors.

49.    To establish, maintain or contribute to any scheme for encouraging or facilitating the holding of
       shares or debentures in the Company by or for the benefit of its employees or former employees,
       or those of its subsidiary or holding company or of any other subsidiary of its holding company, or
       by or for the benefit of such other persons as may for the time being be permitted by law, or any
       scheme for sharing profits with its employees or those of its subsidiary or associated companies, and
       (so far as for the time being permitted by law) to lend money to the Company's employees or to
       trustees for the Company's employees (other than Directors) with a view to enabling them to
       acquire shares in the Company or its holding company.

50.    To create provident funds, gratuity funds, reserve funds, depreciation funds, sinking funds,
       insurance funds, or any other special funds conducive to the interest of the Company and its
       Directors, employees or members.

51.    To enter into any arrangements for sharing profit, co-operation in joint ventures collaboration with
       any foreigner, individually or with any foreign company or corporation interested to carry on the
       like business in Pakistan or abroad as contained in this Memorandum.

52.    To enter into any agreement, contract or arrangement with any foreign or local party, company,
       corporation, organization having objects similar to the Company and to give effect to the same and
       to do and perform all acts, deeds and things in that behalf in Pakistan or outside Pakistan.

53.    To accept investments on repatriable / non-repatriable terms from any person, institution, firm,
       company or corporation with the approval of competent authorities and to allot shares on such
       investments on the terms and conditions as may be mutually agreed upon with representations on
       the Board.

54.    To enter into any arrangement or contract with any Government, including Provincial and any
       local or other authorities, municipal, or otherwise, statutory bodies, corporations, banking
       companies, or other companies, which may seem, conducive to the Company's objects or any of
       them and to obtain from Government, authorities, corporations, statutory bodies, banking
       companies, or other companies licences, permits, permissions, privileges, grants, concessions and

                                                   -49-
Offer for Sale of Ordinary Shares
Arif Habib Investment Management Limited


       leases which the Company may think fit and desirable and to utilise and enjoy such arrangements,
       contracts, licences, permits, permissions, concessions and leases, etc.

55.    Subject to the prior written approval of the Commission, to amalgamate with any company or
       companies having objects altogether or in part similar to those of the Company.

56.    To enter into any arrangements for sharing profits, amalgamation, union of interest, co-operation,
       joint ventures, reciprocal concessions or otherwise with any person, firm or company, institution,
       public body or Government or administration engaged in any business or transaction which the
       Company is authorised to carry on or engage in or any business, undertaking, transaction which
       may seem capable of being carried on or conducted so as to directly or indirectly benefit the
       company, and to guarantee the contracts of or otherwise assist any such person, firm or company
       and to place, take or otherwise acquire and hold shares, stocks, debentures, bonds and securities of
       any such person, firm or company, and otherwise deal with the same without doing any investment
       business.

57.    To distribute any of the properties of the Company amongst the members in specie or in kind but
       so that no distribution amounting to a reduction of capital be made except with the sanction (if any)
       of the time being required by law.

58.    To pay all or any cost, charges and expenses preliminary and incidental to the promotion,
       formation, registration, and establishment of the Company.

59.    To allow and pay underwriting and other commissions, broker's fees, remunerations, premiums
       and charges to any person, firm or company for services rendered or to be rendered in introducing
       any proprietary rights, privileges or business to the Company or about the conduct of the
       Company's business or placing or assisting to place or guaranteeing or procuring the subscription of
       any shares, debentures, debenture-stocks or other securities, which brokerage, remunerations,
       commissions or charges may be paid either in cash or in debentures and shares of the Company.

60.    To pay commission or to otherwise remunerate any company or firm or firms, person or persons
       (whether an officer of the Company or not) for services rendered in placing or assisting to place any
       of the shares of the Company's capital or any debentures or other securities of the Company or for
       negotiating any of the purchases or sales by the Company of any property for the purpose of
       business of the Company or for rendering any services of any kind whatsoever to the Company.

61.    To capitalize such portion of the profits of the Company as are not distributed amongst the
       members of the Company in the form of dividends and as the Directors of the Company may think
       fit and to issue bonus shares in favour of the members of the Company.

62.    To establish and conduct agencies and branches in any part of the world for the purposes of the
       Company.

63.    To draw make, accept, endorse, discount, execute and issue promissory notes, hundies, bills of
       exchange, bills of lading, warrants, debentures and any negotiable or transferable instruments
       concerning the Company.

64.    To open any current, overdraft, cash-credit account or fixed or term deposit account with any
       banker or institution and to pay monies into and draw monies from any such accounts and to
       invest and deal with the monies of the Company not immediately required in any investments, in
       such manner as may from time to time seem expedient.

65.    To borrow or secure for the business of the Company the payment of monies in such manner as the
       Company shall think fit and in particular by the issue of debentures or debenture-stock perpetual or
       otherwise, PTCs, TFCs and other certificates, charged upon all or any of the Company's property
       (both present and future), and to purchase, redeem and pay off any such securities, without

                                                   -50-
Offer for Sale of Ordinary Shares
Arif Habib Investment Management Limited


       derogating from the generality of the foregoing, to obtain finances for the Company's business
       under supplier's credit, hire purchase, mark-up in price, participation in profit and loss, musharika
       and/or modaraba and leasing arrangement(s). The Company shall have full powers through its
       Board of Directors for the time being to enter into appropriate arrangements with banks, financial
       institutions, leasing companies, modarabas, investment banks, etc. for all sorts of finances that may
       be needed for achieving the objects or conducting the business of the Company, including but not
       limited to financing by lending, trade related financing such as finances for short/medium/long
       term on mark-up basis, finances for working capital, finances against packing credit, discounting
       of DA/DP outward bills (finances against foreign bills), running finance, cash finance, demand
       finance, financing by Bai-Al-Muwajjal, financing by Bai-Salam, financing purchase of trade bills,
       financing by purchase of movable and immovable properties with buy-back agreements or
       otherwise, financing by leasing, financing by hire-purchase and financing for development of
       properties and investment modes of financing such as Musharika or profit and loss sharing, equity
       participation and purchase of shares, purchase of and sale or surrender of PTCs, TFCs, etc.
       Modaraba, rent sharing, etc. and all other types of finance, whether on the basis of mark-up, mark-
       down, services charges, annual rates of profit, profit & loss sharing, hire-purchase, leasing or
       otherwise on such securities as the Board may deem necessary and on such conditions and terms as
       may be permissible by the law for the time being in force. The Company will however not indulge
       in the business of a banking or investment company, leasing company or a Modaraba company.

66.    To sell, mortgage, charge, hypothecate, pledge, give on hire, rent or license or otherwise dispose of
       and conversely to accept mortgages, charges, hypothecations, pledges, leases, hires and purchases of
       and over all kinds of movable and immovable properties and assets, including lands, buildings,
       sheds, go-downs, warehouses, offices, plants, machineries, vehicles, goods, concessions, privileges,
       licenses, patents and industrial properties for such consideration as may be deemed feasible for the
       Company and to sign, execute, register and deliver appropriate documents, charge forms, deeds,
       contracts, etc.

67.    To guarantee the payment of money unsecured or secured by or payable under or in respect of
       promissory notes, bonds, debentures, debenture-stocks, contracts, mortgages, charges, obligations,
       instruments and securities of the Company or of any other company whether incorporated or not
       incorporated and generally to guarantee or become sureties for the performance of any contracts or
       obligations to stand as surety for payment/repayment of finances, loans, advances and other
       indebtedness of third parties, including sister concerns and associations; to hypothecate, charge,
       and/or create liens or other encumbrances on the Company's movable and immovable properties in
       favour of financial institutions, banks creditors and other principals.

68.    To appoint any persons or companies as agents of the Company and to grant powers of attorney to
       any person or company with further powers to sub-delegate the authorities except managing
       agencies.

69.    To compromise or compound all actions, suits and other proceedings and differences or disputes to
       arbitration and adjust and settle all accounts and claims relating thereto.

70.    To enter into arbitration agreements and to refer all disputes arising in connection with any right,
       liability or property of the Company or otherwise there from to arbitration whether in Pakistan or
       abroad.

71.    To carry on any operations or activities whatsoever which can, in the opinion of the Company, be
       advantageously or conveniently carried on by the Company by way of extension of, or in
       connection with, any such business as aforesaid or is calculated directly or indirectly to develop any
       branch of the Company's business or to increase the value of, or turn to account, any of the
       Company's assets, properties or rights.




                                                   -51-
Offer for Sale of Ordinary Shares
Arif Habib Investment Management Limited


72.    To do all such lawful things as are incidental or conducive to the attainment of the above objects or
       any of them.

73.    To do all or any of the above things and all such other things, as are incidental or as may be thought
       conducive to the attainment of the above objects or any of them in Pakistan or any other part of
       the world either as principals, agents, trustees, contractors or otherwise and either alone or in
       conjunction with others and either by or through agents, contractors, trustees or otherwise and to
       do all such things as are incidental or conducive to the attainment of the above objects, and each of
       the above objects shall be construed as an independent object.
74.    And generally to do all and everything which may in any way be considered incidental or
       conducive to carrying into effect all or any of the objects of the Company and to carry out the said
       objects or any of them either on account of the Company alone or in co-operation with any other
       company, corporation, person or persons, firm or firms.

       AND it is expressly declared that the several sub-clauses of this clause and all the powers thereof are
       to be cumulative and in no case is the generality of any one sub-clause to be narrowed or restricted
       by any particularity of any other sub-clause nor is any general expression in any sub-clause to be
       narrowed or restricted by any particularity of expression in the same sub-clause or by the
       application of any rule of construction ejusdem generic or otherwise. Provided that the Company
       shall not undertake any activity or transaction which is forbidden under the Rules or any other
       laws, rules and regulations for the time being in force.

75.    This Memorandum of Association shall not be altered without the prior written approval of the
       Securities and Exchange Commission of Pakistan.

IV.    LIMITED LIABILITY
       The liability of the members is limited.

V.     CAPITAL
       The Authorized Capital of the Company is Rs. 300,000,000/- (Rupees three hundred million)
       divided into 30,000,000 (thirty million) shares of Rs. 10/- each. The Company shall have the power
       to increase, reduce or re-organize the capital and divide shares in the capital for the time being into
       several classes constituting ordinary and other classes and kinds of shares in accordance with the
       provisions of the Companies Ordinance, 1984 and Companies Share Capital (Variation in Rights &
       Privileges) Rules, 2000, as may be amended or substituted from time to time, including power to
       issue and redeem preference shares of any class, on such terms and conditions, as the directors may
       deem appropriate, subject to the approval of the members in general meetings. Without prejudice to
       the foregoing, the share capital may comprise ordinary shares and other kinds and classes of shares,
       including preference shares, containing inter alia, such preferential, deferred, qualified or special
       rights, privileges and limitations attached thereto ,and in particular, in relation to different or
       disproportionate entitlements of dividends, right shares or bonus shares, sharing of profits and
       losses, different or disproportionate voting rights and other special rights, privileges and
       entitlements for different or indefinite periods or for limited specified periods, with power to the
       Company from time to time to vary, modify or abrogate such rights, entitlements, privileges or
       conditions and/or to increase or reduce the capital as may be approved by the members from time
       to time.

       We, the several persons whose names and addresses hereto subscribed are desirous of being formed
       into a
       Company in pursuance of this Memorandum of Association and we respectively agree to take the
       number of shares in the capital of the Company set opposite our respective names;




                                                    -52-
  Offer for Sale of Ordinary Shares
  Arif Habib Investment Management Limited




 Name and         Father’s
                                                                                              Number
 Surname in       Name in      Nationality     Occupation       Residential address in full                 Signature
                                                                                              of Shares
     full           full
Muhammad        Habib Haji     Pakistani     Business           86/2,10th Sreet Khayaban-
Arif Habib      Shakoor                                         e-Sehar, Defence Housing
                                                                Authority, Karachi            One          Sd/-
Nasim Beg       Safdar Beg     Pakistani     Chartered          F 61/6,
                                             Accountant         Block 4,
                                                                Clifton, Karachi              One          Sd/-
Amin Umer       Haji Umer      Pakistani     Business           118/11, Phase V,
                                             Executive          Khayaban-e-Badar,
                                                                Defence Housing
                                                                Authority, Karachi            One          Sd/-
Asadullah       Khawaja        Pakistani     Investment         81/2, Phase VI, Khayaban-
Khawaja         Ataullah                     Banker/Fund        e-Bahria,
                                             Manager            Defence Housing
                                                                Authority, Karachi.           One          Sd/-
Muhammad        Ahmed          Pakistani     Service            M.R. 3/42, Juma Building,
Yousuf                                                          Suleman Street, Bomby
                                                                Bazar, Karachi                One          Sd/-



Muhammad        Kassam         Pakistani     Service            G.K-6/57, Apartment No.
Rafiq Jangda    Salman                                          C-7,
                                                                Taboot Lane, Kharadar,
                                                                Karachi.                      One          Sd/-
Abdus Samad     Arif Habib     Pakistani     Service            86/2,10th Street,
                                                                Khayaban-e-Sehar,
                                                                Defence Housing
                                                                Authority, Karachi            One          Sd/-


  Dated the    24th day of   August   2000

  Witness to the above signatures:                 Sd/-
                                             (Zafar Abdullah)

                   Occupation: Chartered Accountant                Address:     C/o Taseer Hadi Khalid &
  Co,
                   Nationality: Pakistani                              Chartered Accountants
                                                                       Sheikh Sultan Trust Building No.2
                                                                       Beaumont Road, Karachi.




                                                       -53-

								
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