nigerian aviation handling company plc - · pdf file5.1 history ... oceanic bank international...

THIS DOCUMENT IS IMPORTANT AND SHOULD BE READ CAREFULLY. If you are in any doubt about its contents or the action to be taken, please consult your Stockbroker, Banker, Accountant, Solicitor or any other professional adviser for guidance immediately.

“For information concerning certain risk factors which should be considered by prospective investors, see ‘risk factors’ commencing from page 14”

Payable in full on Application

Joint Issuing Houses

This Prospectus and the securities which it offers have been registered by the Securities & Exchange Commission. The Investments and Securities Act Cap I24 LFN 2004 provides for civil and criminal liabilities for the issue of a Prospectus that contains false or misleading information. Clearance and registration of this Prospectus and the securities which it offers do not relieve the parties from any liability arising under the Act for false and misleading statements contained therein or for any omission of a material fact.

This Prospectus is dated 30th August, 2007

Nigerian Aviation Handling Company Plc RC 30954

APPLICATION LIST OPENS ON 10th September, 2007 APPLICATION LIST CLOSES ON 28th September, 2007

Offers for Subscription

90,000,000 Ordinary shares of 50 kobo each

at

N=17.50 per share

FCMB CAPITAL MARKETS LIMITED A MEMBER OF THE FIRST CITY GROUP

RC 446561

RC269666

RC 147269

2

Indicative Timetable DATE ACTIVITY RESPONSIBILITY 10th September, 2007 Application List opens Joint Issuing Houses

10th September, 2007 Disburse Firm Underwriting Commitments to NAHCo Joint Underwriters

28th September, 2007 Application List closes Joint Issuing Houses

12th October, 2007 Receiving Agents to forward returns Joint Issuing Houses/ Registrars

9th November, 2007 Forward allotment proposal and draft newspaper advertisement to SEC


23rd November, 2007 Receive SEC clearance of proposed basis of allotment


26th November, 2007 Disburse balance of net Offers proceeds to NAHCo Receiving Bankers

28th November, 2007 Publish basis of allotment in dailies Joint Issuing Houses

30th November, 2007 Return surplus / rejected application monies Registrars

14th December, 2007 Dispatch share certificates Registrars

18th December, 2007 Forward Declaration of Compliance to The NSE

Stockbrokers / Joint Issuing Houses

21st December, 2008 Listing of the shares on The NSE Stockbrokers / Joint Issuing Houses

28th December, 2008 Submit summary report of the Offer to SEC


Please note that all dates are indicative only and are subject to change without prior notice.

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Table of Contents Page 1 THE OFFER……………………………………………………………………………………………………………………………………………………………………………………………………………. 4

2 DEFINITIONS……………………………………………………………………………………………………………………………………………………….………………………………………………. 5

3 SUMMARY OF THE OFFER………….……………………………………………………………………………………………………………………………………………………………………… 6

4 DIRECTORS, SECRETARY AND OTHER PARTIES…………………………………………………………………………………………………………………..……………………….. 9

5 THE CHAIRMAN’S LETTER………………………………………………………………………………………………………………………………………………..………………………………. 11

5.1 History…………………………………………………………………………………………………………………………………………………………………………………………….. 11 5.2 Service Offerings………………………………………………………….…………….………………………………………………………………………………..……………….. 12 5.3 The Operating Environment…………………………………………………………………………………………………………….……………………………………………… 12 5.4 Risk Factors & Mitigants………………………………………………………………………………………………………………………………………………………………. 14 5.5 Directors & Senior Management Staff………………………………………………………………………………………………………………………………………….. 15 5.6 Market Share………………………………………………………………………………………………………………………………………………………………………………….. 18 5.7 Future Prospects……………………………………………………………………………………………………………………………………………………………………………. 18 5.8 Premises………………………………………………………………………………………………………………………………………………………………………………………… 19 5.9 Purpose of the Public Offer………………………………………………………………………………………………………………………………………………………….. 19 5.10 Financial Summary…………………………………………………………………………………………………………………………………………………………………………. 20 5.11 Unclaimed Dividends……………………………………………………………………………………………………………………………………………………………………….. 21 5.12 Corporate Governance……………………………………………………………………………………………………………………………………………………………………. 21 5.13 Research & Development……………………………………………………………………………………………………………………………………………………………….. 21 5.14 Mergers and Takeovers………………………………………………………………………………………………………………………………………………………………….. 22

6 DETAILS OF THE OFFER……………………………………………………………………………………………………………………………………………………………………….…………. 23 …

7 PROFIT FORECAST…………………………………………………………………………………….…………….…………………………………………………………………………………….. 24

7.1 Letter from the Reporting Accountants…..……..…………………………………………………………………………………………………………………………. 24 7.2 Profit Forecast……………………………………………………………………………………………………..……………………….…………………………………………… 25 7.3 Bases and Assumptions…….…………………………………………………………………………………………………………………………………………………………. 26 7.4 Letter from the Joint Issuing Houses…………………………………………………………………………………............................................................... 27

8 FINANCIAL INFORMATION……………………………………………………………………………….…………………………………………………………………………………………….. 28

8.1 Reporting Accountants’ Report ………………………………………………………………………………………….……………………………………………………… 28 8.2 Letter from the Reporting Accountants in respect of NAHCo’s Going Concern Status……………………………….…………………………. 30 8.3 Letter from the Directors on NAHCo’s Going Concern Status………………………………………….………………………….…………………………. 31 8.4 Statement of significant accounting policies.………………………………………………………………………………………………………………….………… 32 8.5 Balance Sheets…………………………………………………………………………………………………………………………………………………………………………….. 34 8.6 Profit and Loss Statements......................................................................................................................................……………………………….…. 35 8.7 Statement of Cash Flows….…………………………………………………………………………………………………………………………………………..…………….. 36 8.8 Notes to the Financial Statements ........................................…………………………………………………………………………….………………………….. 37

9 STATUTORY AND GENERAL INFORMATION………………………………………………………………………………………………………………….………………………….... 45 9.1 Incorporation and Share Capital History...............................….………………………………………………………………………………………………….. 45 9.2 Beneficial Ownership. ……………………………………………………………………………………………..……………………………………………..…………………… 45 9.3 Directors’ Interests………………………………………………………………………………………………………………………………………..………………………….. 45 9.4 Indebtedness…………………………………………………………………………………………………………………………………………………………………..…………… 46 9.5 Subsidiaries, and Associate Companies…………………...............................................................................................…………………………….. 46 9.6 Extracts from the Articles of Association................................................................................................................……………………………... 46 9.7 Declaration…………..…………………………………………………………………………………………………………………………………………………………..…………. 53 9.8 Material Contracts…………………….. ....................................………………………………………………………………………………………………………….….. 53 9.9 Claims and Litigation…………………………………………………………………………………………………………………..……….……………………………………… 53 9.10 Cost and Expenses ……………………………………………………………………………………………………………………………….……………………………………… 54 9.11 Consents……………………………………………………………………………………………………………………………………………………………………………………... 54 9.12 Documents available for inspection………………………………………………………………………………………………..………………………………………….. 55 9.13 Relationship between the Issuer and its Advisers……………………………………………………………………………………………………………………….

10 PROCEDURE FOR APPLICATION AND ALLOTMENT…………………………………………………………………………………………………….………………….……………… 56 RECEIVING AGENTS………………………………………………………………………………………………………………………………………………………………..………………………… 57 APPLICATION FORM…………………………………………………………………………………………………..……………………………………………………………………………………… 58 INSTRUCTIONS FOR COMPLETING THE APPLICATION FORM….…………………………..……………………………………………………………………………………… 59

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1. The Offer

A copy of this Prospectus and the documents specified herein has been delivered to the Securities & Exchange Commission for clearance and registration.

This prospectus is being issued in compliance with the provisions of the Investments and Securities Act Cap I24 LFN 2004, the Rules and Regulations of the Commission and the listing requirements of The Exchange and contains particulars in compliance with the requirements of the Commission and The Exchange, for the purpose of giving information to the public with regard to NAHCo’s offer for subscription of 90,000,000 Ordinary Shares of 50 Kobo each at N17.50 per share by FCMB Capital Markets Limited, Oceanic Bank International Plc, BGL Securities Limited, Sterling Capital Markets Limited and Unex Securities & Investment Limited. An application has been made to The Council of The Exchange for the admission to its Daily Official List of the whole of the Company’s paid-up share capital.

The Directors of NAHCo individually and collectively accept fully, responsibility for the accuracy of the information contained in this Prospectus. The Directors have taken reasonable care to ensure that the facts contained herein are true and accurate in all respects and confirm, having made all reasonable enquiries that to the best of their knowledge and belief, there are no material facts, the omission of which would make any statement herein misleading or untrue.

FCMB CAPITAL MARKETS LIMITED OCEANIC BANK INTERNATIONAL PLC

BGL SECURITIES LIMITED STERLING CAPITAL LIMITED UNEX SECURITIES & INVESTMENT LIMITED

on behalf of

Offer for Subscription

90,000,000 Ordinary shares of 50 kobo each

at

N=17.50 per share

Payable in full on Application

SHARE CAPITAL AND RESERVES OF THE COMPANY AS AT 31ST DECEMBER 2006: N’000 AUTHORISED*: 300,000,000 Ordinary shares of 50kobo each 150,000

ISSUED AND FULLY PAID*: 300,000,000 Ordinary shares of 50kobo each 150,000

EQUITY: Called-up share capital 150,000 Share premium 320 Revenue Reserve 973,917 SHAREHOLDERS’ FUNDS 1,124,237 * At an Annual General Meeting held on 25th May 2007, the authorised share capital was increased from N150 million to N500 million and the issued share capital was increased from N150 million to N375 million through the allotment of 450 million shares to existing shareholders via a bonus issue of three (3) new shares for every two (2) existing shares.

STATEMENT OF INDEBTEDNESS As at the 31st December 2006, the Company had no outstanding debentures, mortgages, charges or similar indebtedness or material contingent liabilities other than in the ordinary course of business. However, the Company had contingent liabilities from pending suits against the Company, which are not expected to exceed N216,693,603.56.

Nigerian Aviation Handling Company Plc

Application List for the 90,000,000 Ordinary shares of 50 kobo each now being offered will open on Monday 10th September, 2007 and close on Friday, 28th September 2007.

RC 230569 RC 269666

RC 446561

RC 499243

RC 147269

RC 30954

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2. Definitions

2.1 “Advisers” Professional parties engaged by NAHCo “CSCS” Central Securities Clearing System Limited ‘Directors” The Board of Directors of NAHCo, who at the date of this document, comprise those persons whose names

are set out on Page 9 of this Prospectus “FAAN” Federal Airports Authority of Nigeria “ISA” Investments and Securities Act Cap I24 LFN 2004 “JIH” or “Joint Issuing Houses” FCMB Capital Markets Limited, Oceanic Bank International Plc, BGL Securities Limited, Sterling Capital

Markets Limited and UNEX Securities and Investment Ltd “LFN” Laws of the Federation of Nigeria “NAHCo” or “the Company” Nigerian Aviation Handling Company Plc “NCAA” Nigerian Civil Aviation Authority “NSE” or ‘The Exchange” The Nigerian Stock Exchange “Pari Passu” Equally “Qualification Date” 18th May, 2007 “SEC” or “Commission” Securities & Exchange Commission “The Combined Offers” Offer for Subscription of 90,000,000 Ordinary Shares of 50 Kobo each at N17.50 and a Rights Issue of

35,000,000 Ordinary Shares of 50 Kobo each at N16.50 per share to existing shareholders “The Offer” The Offer for Subscription of 90,000,000 Ordinary Shares of 50 kobo each at N17.50 per share

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3. Summary of the Offer

The following information should be read in conjunction with the full text of this Prospectus, from which it is derived:

1. The Offer: Offer for Subscription of 90,000,000 Ordinary shares of 50 kobo each of NAHCo at N17.50 per share.

2. Issuer: Nigerian Aviation Handling Company Plc.

3. Joint Issuing Houses: FCMB Capital Markets Limited. Oceanic Bank International Plc. BGL Securities Limited. Sterling Capital Limited.

Unex Securities and Investment Limited

4. Share Capital: Authorised: N500,000,000.00 comprising 1,000,000,000 Ordinary shares of 50 kobo each

Issued and fully paid: N375,000,000.00 comprising 750,000,000 Ordinary shares of 50 kobo each

5. Method of Offer: Offer for Subscription.

6. Purpose of Offer: The purpose of the Offer is to provide funding for the company’s growth strategy, which includes, acquiring equipments, extending the company’s technology platform, construction of new cargo sheds, building brand recognition and increasing the working capital to support the expected expansion.

7. Now being offered: Offer for Subscription of 90,000,000 Ordinary Shares of 50kobo each at N17.50 per share

Additional Information: The Company is simultaneously offering by way of rights 35,000,000 Ordinary Shares of 50kobo each at N16.50 per share

8. Use of Proceeds: The gross proceeds of the Combined Offers is estimated at N2,152,500,000.00. The estimated net proceeds of N2,002,590,465.00 after deducting the costs of the issue, estimated at N149,909,535.00 (representing 6.96% of gross proceeds), will be applied as follows:

Purpose N’million % Estimated Completion Period Equipment Purchase 1,000 49.94 15 months Information Technology 150 7.49 8 months Construction of Cargo Sheds 100 4.99 24 months New Stations* 100 4.99 6 months Restructuring 430 21.47 6 months Re-branding 100 4.99 6 months Working Capital 122.59 6.12 Continuous

Total 2,002.59 100.00% * New stations will be located in Yola, Maiduguri, Jos, Kaduna, Katsina, Enugu, Sokoto, Benin and Calabar.

9. Offer price: N=17.50 per share.

10. Offer size: N=1,575,000,000.00

11. Combined Offer size: N=2,152,500,000.00

12. Market Capitalisation at Offer Price: (Pre Combined Offers)

N13,125,000,000.00

13. Market Capitalisation at Offer Price: (Post Combined Offers)

N15,312,500,000.00

14. Units of Sale: Minimum of 1,000 Ordinary Shares and in multiples of 100 Ordinary Shares thereafter.

15. Payment: In full on application.

16. Preferential Allotment: 25,000,000 shares representing 27.78% of the Offer will be preferentially allotted to identified investors.

17. Over Subscription: There is no provision to accept oversubscriptions, should such arise after full allotment of the shares on offer. Surplus monies will be returned to applicants under the rules and regulations of, and within the time prescribed by, the Securities and Exchange Commission.

18. Opening Date: 10th September, 2007.

19. Closing Date: 28th September, 2007.

20. Quotation: An application has been made to The Council of The Exchange for the admission to its Daily Official List of the entire 125,000,000 Ordinary shares of NAHCo via the Offer for Subscription and Rights Issue.

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3. Summary of the Offer (cont’d) .

21. Status: All the shares to be issued shall rank pari passu in all respects with the issued Ordinary shares of the Company except that it does not qualify for any interim dividend that may be declared for the year ended 31st December 2007.

22. Underwriting: 80% of the Offer is being underwritten on a firm basis, with each of the 6 (six) Underwriters,

committing N287 million.

23. FINANCIAL SUMMARY As at 31st December 2006 2005 2004 2003 2002

N=’000 N=’000 N=’000 N=’000 N=’000

Turnover 3,245,553 3,050,539 2,343,618 2,173,277 1,851,277 Gross Profit 1,342,020 1,734,408 1,089,859 960,855 751,453

Profit on ordinary activities before taxation 555,946 457,728 155,307 194,314 204,858

Taxation (121,829) (140,000) (55,319) (55,621) (46,479) Profit on ordinary activities after taxation 434,117 317,728 99,988 138,693 158,378 Appropriations: Dividend (90,000) (90,000) (72,431) (146,417) (124,460) Retained profit for the year 344,117 227,728 27,557 (7,724) 33,917

Dividend per share – (Kobo) 0.30 0.30 0.62 1.25 1.06

Earnings per share – (Kobo) 1.48 1.06 0.48 0.98 0.83 Earnings per share and price earnings ratio are based on 150,000,000 Ordinary Shares of N1 each for 2002, 2003 and 2004 and 300,000,000 Ordinary shares of 50 kobo each for 2005 and 2006.

24. FORECAST STATISTICS As at 31st December 2007 2008 2009 N=’000 N=’000 N=’000 Turnover 3.798.000 5.270.000 6.587.000

Gross Profit 1.681.000 2.273.000 2.959.000 Profit before taxation 819.000 1.184.000 1.789.000

Profit after taxation 557,000 805,000 1,217,000 Proposed Dividend (394,000) (569,000) (572,000) Forecast earnings per share (kobo) 74 92 139

Forecast dividend per share (kobo) 53 65 65 Forecast earnings yield (at offer price) 10.51% 5.37% 8.08% Forecast dividend yield (at offer price) 1.69% 2.54% 3.67% Forecast dividend cover (times) 6.19 2.04 2.14 Price/earnings ratio (at offer price) 9.52 18.63 12.38 The Forecast basic earnings and dividend per share are based on 750,000,000 Ordinary Shares of 50 kobo each for 2007 and 875,000,000 Ordinary Shares of 50 kobo each for 2008 and 2009

25. CLAIMS AND LITIGATIONS: There are 7 pending suits against NAHCo Plc with a total claim of N216,693,603.56 made up of N81,891,075.50 and $1,069,891.81 while NAHCo Plc, on the other hand is seeking to recover the sum of N85,567,458.90 from 2 suits instituted by it. However, the Solicitors to the Offer are of the opinion that the maximum contingent liability that may arise from the pending cases against the company is not likely to exceed the sum of N216,693,603.56. Save as disclosed, the solicitors to the offer are not aware of any other pending or threatened claims or litigation involving the company, which may be material to the offer.

26. INDEBTEDNESS: As at the 31st December 2006, the Company had no outstanding debentures, mortgages, charges or similar indebtedness or material contingent liabilities other than in the ordinary course of business. However, the Company had contingent liabilities from pending suits against the Company which are not expected to exceed N216,693,603.56.

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3. Summary of the Offer (cont’d)

27. SHARE CERTIFICATES: Share certificates in respect of shares allotted will be sent by registered post not later than 15 working days from the date of allotment. Any investor who does not want to receive a physical share certificate, should state the name of his/her stockbroker and his/her CSCS account number in the space provided on the Application Form.

28. CORPORATE DIRECTORY: NAHCo Plc currently operates from its corporate Head Office and four outstations located in Abuja, Kano, Lagos and Port Harcourt, details of which are provided below:

Head Office: Murtala Muhammed International Airport

Ikeja Lagos Tel: +234 1 4970053, 7741161, 7741165 ; Fax: +234 1 4970053

Outstations:

i Nnamdi Azikiwe International Airport, FCT Abuja Tel: +234 9 8100023;

ii Mallam Aminu Kano International Airport Kano Kano State

iii 2nd Floor Murtala Muhammed International Airport Ikeja Lagos State

iv Port Harcourt International Airport Omagwa Rivers State Tel: +234 64 942117

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4. Directors, Secretary and Other Parties

Directors: Ambassador (Dr.) Patrick Dele Cole (Chairman) Plot 222, Etim Inyang Crescent Victoria Island Lagos.

Joint Issuing Houses: FCMB Capital Markets Limited Primrose Tower (4th Floor) 17A, Tinubu Street Lagos.

Alhaji Suleiman Yahyah (Vice-Chairman) 164A, Adetokunbo Ademola Crescent Wuse II Abuja.

Oceanic Bank International Plc Plot 270, Ozumba Mbadiwe Avenue Victoria Island Lagos.

Mr. Bates Sarki Sule (Managing) NAHCo House Murtala Muhammed International Airport Ikeja Lagos.

BGL Securities Limited Plot 1061B, Abagbon Close Victoria Island Lagos

Mr. Mobolaji Balogun 45, Saka Tinubu Street Victoria Island Lagos.

Sterling Capital Markets Limited 67, Marina Lagos Island Lagos

Arc. Usman Arabi Musa Bello 6B, Rimi Road Anguwar Rimi Kaduna.

Unex Securities & Investment Limited 3, Biaduo Street Off Keffi Road South-West Ikoyi Lagos

Mr. Sylvanus Pyam Yakubu Gang 8, CBN Road Jos.

Joint Receiving Banks: First City Monument Bank Plc Primrose Tower 17A, Tinubu Street Lagos.

Mr. Denis Hasdenteufel (French) (Air France Representative) Le Dome 2, Rue de la Haye BP 10201 F-95703 Roissy CDG cedex France.


Mr. Thomas Mueller (German) ( Lufthansa Representative) Murtala Muhammed International Airport Ikeja Lagos.

Solicitors to the Offer: Ahmed Uwais & Co Suites 1 & 2, First Floor Plot 991/992, Zakariya Maimalari Street CBD, Abuja

Mr. Osita Apollos Onyenwe 27, Owolegbon Street Atunrase Estate Gbagada Lagos.

Solicitors to the Company: Banwo & Ighodalo 98 Awolowo Road Ikoyi Lagos

Mr. Brett Silver (South African) (British Airways Representative) The Waterfront 5 Oyinkan Abayomi Drive Ikoyi Lagos.

Registrars: City Securities (Registrars) Limited Primrose Tower (2nd Floor) 17A, Tinubu Street Lagos

Company Secretary/Registered Office: Mrs. Folashade Ode NAHCo House Murtala Muhammed International Airport Ikeja Lagos.

Reporting Accountants: BDO Oyediran Faleye Oke & Co Barbinder Chambers Elephant Cement House (5th Floor) ASSBIFI Road, Central Business District Alausa – Ikeja Lagos

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4. Directors, Secretary and Other Parties (cont’d) Joint Underwriters: FCMB Capital Markets Limited Primrose Tower (4th Floor) 17A, Tinubu Street Lagos.

Stockbrokers to the Offer (Cont’d): Anchoria Investments and Securities Limited 112, Lewis Street Lagos Island Lagos


Compass Investments and Securities Limited Stock Exchange House (16th Floor) 2-4 Customs Street Lagos

BGL Securities Limited Plot 1061B, Abagbon Close Victoria Island Lagos

Empire Securities Limited 2nd Floor, 13, Macarthy Street Onikan Lagos

Chapel Hill Advisory Partners Limited 1st Floor, 45, Saka Tinubu Street Victoria Isalnd Lagos

FutureView Financial Services Limited Plot 161D, Aufu Taylor Close Off Adeola Odeku Street Victoria Island Lagos

Sterling Capital Markets Limited 67, Marina Lagos Island Lagos

Premium Securities Limited 16, Keffi Street Ikoyi Lagos

Unex Securities & Investment Limited 3, Biaduo Street Off Keffi Road South-West Ikoyi Lagos

Profund Securities Limited 7th floor, PC 1, Engineering Close Off Idowu Taylor Street Victoria Island Lagos

Auditors: Horwath Dafinone Ceddi Towers 16 Wharf Road Apapa Lagos

Spring Stockbrokers Limited Plot 1611 Adeola Hopewell Street Victoria Island Lagos

Stockbrokers to the Offer: GTI Capital Limited Stock Exchange House (20th Floor) 2-4 Customs Street Lagos

Tower Asset Management Limited The New Niger House 4th Floor 3/4 Tinubu Street Lagos Island Lagos

Intercontinental Securities Limited 16th Floor, Bull Plaza 38/39 Marina Lagos

TRW Stockbrokers Limited 62/64 Campbell Street 5th Floor (Rear) Kajola House Lagos Island Lagos

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5. The Chairman’s Letter

The following is the text of the letter received from Ambassador (Dr.) Patrick Dele Cole on behalf of the Board of Directors of Nigerian Aviation Handling Company Plc.

30th August, 2007 The Directors

FCMB Capital Markets Limited Primrose Tower (4th Floor) 17A, Tinubu Street Lagos

The Directors Oceanic Bank International Plc Plot 270, Ozumba Mbadiwe Avenue Victoria Island Lagos

And And And The Directors, BGL Securities Limited Plot 1061B, Abagbon Close Victoria Island Lagos

The Directors Sterling Capital Limited 67, Marina Lagos Island Lagos

The Directors Unex Securities & Investment Limited 3, Biaduo Street Off Keffi Road South-West Ikoyi Lagos

Dear Sirs,

NIGERIAN AVIATION HANDLING COMPANY PLC OFFER FOR SUBSCRIPTION OF 90,000,000 ORDINARY SHARES OF 50 KOBO EACH AT N17.50 PER SHARE

On behalf of the Directors of Nigerian Aviation Handling Company Plc (“NAHCo” or “the Company”), I am pleased to provide you with the following corporate information in connection with the proposed Offer for Subscription of 90,000,000 Ordinary shares of 50 kobo each at N17.50 per share, which you are making on our behalf:

5.1 History

NAHCo was incorporated as a Private Limited Liability Company on 6th December, 1979 under Schedule 2 of the then Nigerian Enterprises Promotion Decree, with Nigerian and foreign equity ownerships in the proportion of 60% and 40% respectively. The Federal Government’s ownership of 60% was offered for sale to Nigerians in November 2005 while four foreign airlines owned and still own the remaining 40% of the Company’s share capital. The Company was converted to a public limited liability company on 4th August 2005.

From Government to Private Ownership Following the decision of the Federal Government to divest its shares in the Company, and the Board’s resolution of 4th August, 2005 changing the status of the Company to a Public Limited Liability Company, the Bureau of Public Enterprises (BPE), on behalf of the Federal Airport Authority of Nigeria, offered for sale 180 million ordinary shares of 50 kobo each at N5.50 per share through an Initial Public Offering which opened on 31st October 2005 and closed 28 November, 2005. The Offer was oversubscribed by 80% and today, NAHCo’s shares are held as follows: Nigerian Public: 60% Air France: 12.5% British Airways: 12.5% Sabena (in liquidation): 8% Lufthansa: 7% Stock Exchange Listing The full circle in the change of ownership of NAHCo was finally completed with the historic listing of the Company’s Shares on 27th November, 2006. The shares were listed at N5.50 and have remained one of the most actively traded securities on The Nigerian Stock Exchange.

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5. The Chairman’s Letter (cont’d)

5.2 Business Activities

NAHCo’s main activities revolve around the following:

• Passenger and baggage handling; • Cargo handling through its customs bonded warehouses and mail handling through postal authorities; and, • Ramp and other ground handling services through the provision of ground support equipment.

5.2.1 Passenger Handling

NAHCo’s passenger handling services thrive on speed, flexibility, safety, empathy, and knowledge of the customer’s needs. The Company has automated its services to reduce transaction time. With the Departure Control System (DCS), and the Integrated Multi User System (IMUSE), check-in procedures are quick and efficient.

5.2.2 Ramp Services

NAHCo staff work hard to ensure airlines operate their flights on schedule and in accordance with international safety standards. From the point of the aircraft landing to departure, NAHCo’s technical staff perform crucial tasks such as aircraft push back, cleaning and maintenance, using a wide range of functional and modern equipment.

5.2.3 Cargo Services

In handling cargo, the Company places a premium on safety and strict adherence to international requirements. NAHCo is guided by the International Civil Aviation Organisation (ICAO) regulations and other conventions on aviation ground handling to ensure that its services conform to global best practices. All cargo operations are computerised using the Hermes technology, and this has helped to improve service delivery. Its Cargo Handling Services take place in an ultra-modern warehouse installed with screening machines and manned by staff who have received extensive training in cargo handling procedures.

5.3 The Operating Environment

The Nigerian Aviation industry has undergone significant administrative, structural and operational changes in the past 24 months, all with a view to improving safety standards and enhancing service quality. The background to this is the recent spate of disasters and the falling standards in the industry. To this end, the Nigerian Civil Aviation Authority has introduced a series of reform measures prominent amongst which is the increase in the minimum capital requirement to N500 million. However, numerous challenges still confront the industry, some of which are listed below:

Challenges Ahead for the Aviation Industry • Low investment in Human Capital Development. • Environmental issues • Corporate Social Responsibility Issues • Passenger traffic growth potential • Safety and Risk Audit • Liberalisation of market operations and airline ownership. • High capital expenditure requirement • Balancing profitability and stakeholder value

In order to overcome the foregoing challenges, NAHCo has embarked on the following business development initiatives: 1. Capitalisation In order to maintain its competitive edge, NAHCo has, through the consistent policy of ploughing back a significant portion of profits into the Company, grown its shareholders’ funds to N1,124.24 million more than two times the regulatory requirement. Furthermore, the current recapitalisation initiative by NAHCo is meant to further reinforce NAHCo’s dominant position in the airline services industry.

2. Customer Service Imperatives In order to enhance service delivery and sharpen its competitive edge, NAHCo has embarked on several initiatives to improve customer service. Members of staff have attended local and international training and capacity development programmes. Management has instituted service excellence culture, predicated on respect for the customer, integrity, and professionalism. NAHCo has also embarked on attitudinal change and re-orientation programmes, in addition to providing a conducive environment and the basic tools needed to enhance service standards.

3. Information and Communications Technology In appreciation of the crucial role technology plays in its business, NAHCo acquired cutting edge technology to support service delivery across all platforms. In order to integrate its passenger handling services into the ICT System and allow for flexibility, NAHCo introduced the Integrated Multi User System (IMUSE), which is also compatible with most airlines’ systems. IMUSE is a business project whose purpose is to add value to passenger service processes and bring Nigeria’s operations in line with global practices.

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On 7 September 2006, NAHCo commissioned the Oracle e-business Suite, a bundle of applications built on unified information architecture to process business data, analyse information, and generate current performance metrics. Oracle e-Business Suite ventilates the desire of Management to enthrone a culture of transparency and accountability in all facets of its operations. The software has the capacity to consolidate data from oracle and non-oracle operations for easy accessibility of all users.

The Oracle Financial, an aspect of the e-business suite, is actually an Enterprise Resource Planning (ERP) tool for financial and accounting management. This means that data from Ramp, Cargo, and Passenger Services, as well as from out-stations in Abuja, Kano, and Port Harcourt, are networked into a single pool of information. NAHCo has also recently commissioned the Hermes Cargo System, a world class integrated computerized system for the management of cargo documentation and processing. It is designed to enhance standard rapid flow of import and export cargo through faster electronic document processing, pre-flight information about cargo, secure operations, and electronic cargo advice dispatch. Hermes has been instrumental to continued success of NAHCo’s cargo handling operations.

4. International Strategic Alliances NAHCo is working towards entering into strategic partnerships and alliances between now and the first quarter of 2008. A couple of international organisations have been approached to explore the possibility of business synergy. This has a twin objective of increasing NAHCo’s capacity and capability in the Nigerian market, as well as enabling it to compete on the global stage.

It also sits well within its three-year Corporate Business Plan as the Company seeks to fully explore emerging opportunities in the African Regional market. Benefits of the strategic alliance include exchange of best practices, increase in buying power, joint overseas marketing and bidding opportunities, pooled databases, and worldwide recognition for the NAHCo brand.

5. Equipment Acquisition NAHCo has rolled out an ambitious Equipment Acquisition Plan which will see it committing over N500million in the first phase to the replacement of ageing equipment in order to ensure that service delivery consistently remains at optimal levels. The Company has voluntarily placed a ceiling on the age of its equipment and will limit equipment age to 10 years in Lagos and 15 years in the outstations in Abuja, Port Harcourt, and Kano.

6. Business Expansion As the Nigerian aviation industry opens up through licensing of more local and international carriers, there will be opportunities for NAHCo to provide its trademark quality ground handling services. Delta Air and Kenya Airways are expected to commence international route operations while Air France is expected to increase operations this year. Therefore, NAHCo will, as from 1 September 2007, begin to extend its operations to other airports such as Calabar, Benin, Enugu, Yola, and Sokoto. The Company will also be moving to the newly completed Terminal 2 of the Murtala Muhammed Airport, as soon as it starts operations. This has become necessary for it to be able to adequately serve its new and prospective clients operating on the domestic routes. The Company will also be exploring the possibility of expanding into the West African Sub-Region, either directly or in partnership with other international ground handling companies.

7. Human Capital Development A core aspect of NAHCo’s Business Transformation Agenda is Human Capital Development. NAHCo has therefore retained the firm of PricewaterhouseCoopers to provide consultancy services which include review of Job Descriptions, Staffing Levels, Skills/Competency Fit, Performance Management, Process Review, etc, all with a view to retooling NAHCo’s human resources and ensuring that employees are well positioned to support Management in the actualisation of the Company’s long term strategic goals.

The Company recognises the importance of having the right calibre of staff as it seeks to consolidate its leadership position in Nigeria and also venture into the regional and continental markets. Over the next three years, NAHCo intends to recruit and retain the best hands in the industry, whilst ensuring that existing staff are adequately motivated.

NAHCo’s operations are carried out at its corporate headquarters, Murtala Muhammed Airport, Ikeja, Lagos and all other International Airports across the country. NAHCo’s Management structure is made up of the Managing Director’s Office and three divisions as shown in the organogram below:

MD/CEO’s Office The MD/CEO’s Directorate is made up of four Departments saddled with the responsibility of formulating Business Strategy, managing stakeholders, and supporting core operations.

MD/CEO’S Directorate • Corporate Planning & Communications • Legal • Commercial • Internal Audit and Risk Management

The core operations of the Company are carried out across three major Divisions. They are Operations, Finance and ICT, and Human Resources and Administration.

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5. The Chairman’s Letter (cont’d) Operations Headed by a Chief Operating Officer (COO), the Division is made up of:

a. Passenger Services b. Cargo Services c. Ramp Services a. Maintenance b. Outstations (Abuja, Kano, Lagos and Port Harcourt)

Finance and ICT Three Departments form this Division:

a. Management Accounts b. Financial Accounts c. ICT

Human Capital a. Manpower Training and Development b. Human Resources Operations c. Employee Relations d. Administration

5.4 Risk Factors and Mitigants

As optimistic as NAHCo is on its continued impressive performance, it is necessary to take cognizance of socio-political and economic factors and limitations that could impact negatively on the Company’s operating performance. These limitations include unfavourable Government policies, the general state of the nation’s economy, activities of regulatory agencies, political developments, and airlines’ customer service and safety records.

In addition, NAHCo’s ability to continue to maximize returns on investment will depend on the strategic approach of the Federal Government towards the development of the Aviation industry. Since NAHCo’s business is dependent on availability of airlines, a favourable government policy will be for more airlines to be licensed to operate in Nigeria.

M D ( C E O )

H e a d , C o r p o r a t e P l a n n i n g &

C o m m u n i c a t i o n

H e a d , I n t e r n a l A u d i t & R i s k M a n a g e m e n t

C o m p a n y S e c /L e g a l C o u n s e l

H e a d , C o m m e r c i a l

H e a d , F i n a n c e & I C T ( C F O )

H e a d , H R &

A d m i n

H e a d , O p e r a t i o n s ( C O O )

H e a d , C a r g o S e r v i c e s

H e a d , O u t s t a t i o n s

H e a d , P a s s e n g e r & R a m p S e r v i c e s

H e a d , F i n a n c i a l A c c o u n t s

H e a d , I C T

H e a d , M a n a g e m e n t

A c c o u n t s

H e a d , M a i n t e n a n c e

H e a d , H R O p e r a t i o n s

H e a d , E m p l o y e e R e l a t i o n s

H e a d , M a n p o w e r T r a i n i n g & D e v p t

H e a d , A d m i n

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Business/Operational Risks

NAHCo is faced with the risk of aircraft damage, missing or pilfered baggages, body harm to passengers, and delay of airlines’ operations. Indirectly, NAHCO is also exposed to risks that may be associated with airlines not getting adequate business. NAHCo has created a Health, Safety and Environment (HSE) Department to proactively manage all forms of risks associated with its businesses. The Company’s operations thrive on safety. Safety measures are clearly outlined, enforced, and monitored across the organization, in line with NCAA, IATA and ICAO standards and Conventions. NAHCo’s ultra modern warehouse is installed with screening machines as well as closed circuit televisions and manned by competent security operatives.

Competition The proposed privatisation of SAHCOL, NAHCo’s major competitor, will heighten competition as we expect that private ownership will enhance SAHCOL’s competitiveness. NAHCo is therefore focused on improved service delivery in order to retain market share as well as sign on the vast majority of the newly licensed airlines, consolidating its market share by reviewing its operations to ensure better service delivery. The Company is also working with the firm of PriceWaterhouseCoopers to develop a workforce that is result-oriented.

Political Risk The Political environment can produce policy reversals that could inadvertently affect the operations of NAHCo. The Company will hedge against this by being proactive and seeking to diversify its business lines. Environmental Risk Health and safety issues within the aviation industry will continue to pose risks to NAHCO’s business. These are being tackled with the designation of a Senior Staff as the Health, Safety, and Environment Officer, charged with the responsibility of identifying risk areas, enthroning, and implementing safety policies and programmes.

Sectoral Risk NAHCo’s activities will be adversely affected by any crisis in the Aviation Industry, such as air disaster, because passenger confidence in air travel consequently wanes and passenger traffic drops, thereby negatively affecting airlines’ income. The thrust of NAHCo’s long term plan is to diversify its income stream to other sectors with no direct relationship to the aviation industry.

Currency Risk Less than 3.5% of the Company’s income is denominated in foreign currencies. It is expected the the Federal Governments reform in the financial sector which has led to a significant increase in the country’s foreign reserves as well as the CBN’s effective management of the exchange rate would ensure that the exchange rate between the naira and the dollar continues to remain stable.

5.5 Directors and Management Staff

The Board of Directors (Board) oversees the business of the Company and is responsible for the corporate governance of the Company. Details of Board members are set out below

5.5.1 Board of Directors

I was appointed as Chairman of the Board of Directors in January, 2007. I obtained a Masters degree in History and Political Science from the University of Otago, Dunedin, New Zealand in 1965, as well as a Ph.D. in 1969 from Stephen Berhens Cohen College, Cambridge, UK. I have also served Nigeria in various capacities such as: member, Nigeria-China Forum in 1979; Nigerian Ambassador to Brazil (1987 – 1990); Deputy National Chairman (South-South); People’s Democratic Party of Nigeria; PDP, (1998-1999); and Special Adviser on International Relations to the President (1999 – 2001).

I am pleased to present other members of the Board:

Alhaji Suleiman Yahyah – Vice Chairman: He attended Bayero University, Kano where he graduated with a First Class Honours degree in Economics in 1987. He also attended Cambridge University where he obtained a Masters degree in Economics and Politics of Development in 1990. Alhaji Yahyah is an active member of numerous professional organisations in Nigeria and overseas, such as Chartered Institute of Stockbrokers, Cambridge Commonwealth Society, Investment and Securities Tribunal among others.

He started his working career with Continental Merchant Bank as a Corporate Finance Supervisor in 1987. He has served on the Board of numerous organisations, including RoseCom Net, Rose Hill Group Limited, Empire Securities Limited, Talafon Telecommunications, First City Group, and NUB International Bank. Alhaji Yahyah has many publications on Economics and Financial issues. He is currently a member of the Nigeria Economic Summit Group (NESG), Alfred Marshall Economic Society, England and Nigeria Internet Group.

Mr. Bates Sarki Sule – Managing Director/Chief Executive Officer: Mr. Sule attended Ahmadu Bello University, Zaria where he obtained a B.Sc. (Hons) Degree in Chemistry/Biochemistry in 1978. He also obtained a Post Graduate Diploma in Management and an MBA from Usman Dan Fodio University, Sokoto in 1995 and 1998 respectively. He is an experienced Aviation Administrator and has held several top management positions, including being Airport Manager at Sokoto and Maiduguri Airports.

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He has also been Head of Operations, Murtala Muhammed International Airport, Lagos, Nnamdi Azikiwe International Airport, Abuja and Maiduguri International Airport. Before assuming his present position, Mr. Sule managed the Domestic and Hajj/Cargo Terminals respectively at Murtala Muhammed International Airport, Lagos. He is a member of the Nigerian Institute of Management (NIM) and the Institute of Directors (IOD), Nigeria.

Mr. Sylvanus Pyam Yakubu Gang: Mr. Gang holds a Bachelors degree in Business Administration (1975) and an MBA (1979) from Ahmadu Bello University, Zaria.

Mr. Gang worked with the Plateau State Government as Senior Commercial Officer between 1976 and 1981. He also worked with the then Savannah Bank of Nigeria Plc, Jos, as a Credit Officer between 1982 and 1983. He was promoted Deputy Branch Manager of the Kano branch in 1983. He worked with FSB International Bank as a Senior Manager, before moving to Lion Bank of Nigeria where he was appointed the Deputy Managing Director in November 1992 and confirmed Managing Director/Chief Executive Officer in April 1993. He is currently a Principal Partner of SPY Gang and Associates (Financial, Management and Legal Consultants and Trainers).

Mr. Osita Apollos Onyenwe: Onyenwe holds a B.Sc. (Hon.) Degree in Zoology from University of Nigeria, Nsukka (1977), Post Graduate Diploma from Ahmadu Bello University, Zaria, (1979), and MBA from University of Lagos (1981). He was a lecturer at the College of Education, Maiduguri. Onyenwe is the Chairman of Arrosyn Impex Nigeria Ltd, Pathway Communications Ltd and Centric Industries Ltd.

Mr. Mobolaji Balogun: Mr. Balogun attended London School of Economics, University of London where he obtained a B.Sc. Degree (Hons) in Economics in 1989. Mr. Balogun is the Managing Partner and Chief Executive Officer of Chapel Hill Advisory Partners Limited. He is an Associate Member of the Chartered Institute of Stockbrokers, Nigeria as well as an Authorised Dealing Clerk of the Nigerian Stock Exchange. He has over sixteen years experience in investment banking and mobile telecommunications. Between 1998 and 2004, Mr. Balogun was an executive director in CSL Stockbrokers Limited and FCMB Capital Markets Limited from where he joined the Econet Wireless Nigeria (now Celtel) as pioneer Chief Business Development and Strategy Officer and later Chief Marketing Officer.

Mr. Balogun serves as a Director of CSL Stockbrokers Limited and the West African Portland Cement Company Plc (a Lafarge subsidiary). He is also a member of the Committee on the Nigerian Corporate Governance Code and the President of the Advisory Board of SBA – Reuters Nigerian Issuing Houses League.

Arc. Usman Arabi Musa Bello: Arc. Bello attended Ahmadu Bello University, Zaria from where he bagged a B.Sc. (Hons) Degree in Architecture (1987), as well as M.Sc. Architecture (1995) and MBA (1993). Bello is a member of the Nigerian Institute of Architects, the Architect Registration Council of Nigeria, as well as an Associate Member of the Nigerian Institute of Management. He is a Property expert with considerable experience. His Directorial responsibilities cover Bells Properties & Services Ltd, HNB Security and Protective Company, Polyfibre Industrial Limited, and Confidence Finance Ltd. He is a member of the Amateur Basket Ball Association and Federal Road Safety Commission.

Mr. Denis Hasdenteufel (French): Mr. Hasdenteufel represents Air France on the Board of NAHCo. He attended Master of Commerce High School in Paris. He has held various positions in Air France, ranging from General Manager at Charles de Gauile Airport to his present position as International Purchasing Vice President. He also represents Air France on the Boards of CIAS (Singapore), AIDA (Mauritius) and AFSL (Great Britain). Mr. Hasdenteufel joined NAHCo’s Board in 2000. Mr. Thomas Mueller (German): Mr. Thomas Mueller was appointed Director, Lufthansa Operations & Airport Services - West Africa effective February 15, 2006. Mr. Mueller had a stint in the German Army after his primary and secondary education. He started his career with Lufthansa in July 1991.

Mr. Mueller had his first posting abroad as Station Manager in Nairobi, Kenya (until 1999) and subsequently as Station Manager for Condor Airlines, a subsidiary of Lufthansa, in Mombasa, Kenya until September 2000 after which he was posted to the cities of Samara and Kazan as Regional Manager, Mid-Volga Region and Republic of Tatarstan, Russia. Mr. Brett Silver (South African): Mr. Silver represents British Airways on the Board of NAHCo Plc. Brett is a qualified Accountant and has been an Associate of the Chartered Institute of Management Accountants of England and Wales since 2001. He is also a member of the Institute of Directors of Pall Mall, London and has recently passed the IoD Diploma in Company Direction.

Mr. Silver began his career with Unilever in South Africa before moving to London. He has held various positions within British Airways since 1997, notably General Manager, Finance, East and Central Africa based in Nairobi; General Manager Finance, South East Asia based in Singapore; and most recently General Manager Nigeria for British Airways World Cargo, based in Lagos. Mr. Silver was appointed to the Board of NAHCo in June 2005.

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5.5.2 Senior Management Staff

The senior Management cadre of the Company is made up of qualified and experienced professionals. The key members of Management are as follows:

NAME POSITION BRIEF PROFILE Engr. Kristof Henot Chief Operating Officer Engr. Henot graduated from Louvain Institute of Technology,

Belgium in 1994 with a Masters degree in Engineering (Electromechanical). He also obtained a Postgraduate degree in Business Economics from the Catholic University of Louvain, Belgium in 1995. He obtained a Flight Engineer’s License from Belgian Civil Aviation Authority in 1998.

Before joining NAHCo in 2006, Henot had worked in the following capacities:

• Facility Administration and Ground Support Equipment Supervisor, DHL Aviation, N.V Brussels Airport;

• Maintenance and Procurement Manager, African Ground Operations (AFGO) Ghana Ltd now Aviance Ghana Ltd, between 1999 and 2003;

• After Sales Manager; General Manager (Parts and Service), PASICO Ghana Ltd between 2003 and 2006;

Dr. Mrs. Oladapo-Sanu Head, Medical Services Dr. Sanu obtained a B.Sc. in Zoology from Howard University, USA (1977) before obtaining an MBBS from the College of Medicine, University of Lagos (1982). She also obtained a Post graduate Diploma (TM&H) in 1994. Dr. Sanu joined NAHCo in 1987 as a Medical Officer and has risen through the ranks to become the Chief Medical Consultant. She has attended courses in Tropical Medicine and Hygiene.

Michael O. Ajigbotosho Head, Operations Mr. Ajigbotosho obtained a Master of Science degree in Transport from Olabisi Onabanjo University, Ago Iwoye (1999) in addition to certificates in Aeronautical Telecommunications and Aeronautical Radio Operation. He is an Associate member of the Nigerian Institute of Management (NIM) and Chartered Institute of Transport (MCIT).

Mrs. O.I Okpere Head, Human Capital Mrs. Okpere holds a B.Sc Political Science from the Ahmadu Bello University, Zaria, Kaduna in 1983. She has held various positions in the Human Resources Department since joining NAHCo in 1984. She has risen through the ranks and is currently the AGM Human Resources. Mrs. Okpere has attended several courses in Human Resources Management both locally and overseas. She is a member of the Nigerian Institute of Management, Chartered Institute of Personnel Management and Nigerian Institute of Public Relations.

Kieran Osman Anuforoh Head, Finance & Accounts Mr. Anuforoh became a Chartered Accountant in 1980 after graduating from Southampton College of Technology, England in the same year. He majored in Qualitative Management Reporting, Financial Management and Business Risk Analysis. Anuforoh worked in various organisations including Jetlink Ltd., Jagal Group Ltd., Fathgate Holdings before joining NAHCo in 2005.

Jacob Adekola Head, Maintenance Mr. Adekola has Middle School Certificate from RCM Nsuta Wassaw, Ghana (1969) as well as a GCE O Level from Okemesi Grammar School, Ekiti State (1973). He attended several Ground Support Equipment Training Programmes in Nigeria, United Kingdom, France and the United States of America between 1979 and 1985. Prior to joining NAHCo, he had worked with Lucas House Nigeria Limited (UAC) from 1974 – 1977 and with Nigeria Airways Limited from 1977 – 1979. He was a pioneer Manager with SAHCOL on secondment from Nigeria Airways Ground Equipment Engineering Division from 1996 – 1999. He joined NAHCo in 2007.

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Ademola Akinbola Head, Corporate Planning and Communications

Mr. Akinbola obtained a HND in Mass Communication from Ogun State Polytechnic in 1990. He also obtained a Master of Communication and Language Arts Degree from the University of Ibadan in 1997. He has had over 15 years professional experience, spanning Journalism, Marketing Communications, Brand Management, Consumer Banking, Business Development, Corporate Development, and Book publishing. He has worked at various organisations including The Guardian, This Day, Punch, Owena Bank (now Spring Bank), Prudent Bank (now Skye Bank), and the British Council.

He is a member of the Chartered Institute of Marketing, United Kingdom; Nigerian Institute of Public Relations (NIPR), and an alumnus of the Lagos Business School. He has attended many Managerial and Business Development courses in Nigeria, Ghana, Ethiopia, United Kingdom, and Hungary. He last worked as Head of Communications and Marketing at British Council, before joining NAHCo in April 2007.

Mrs. Folashade Ode Company Secretary/Legal Counsel

Mrs. Ode holds LLB (Hons), from the Lagos State University, 1990; Barrister at Law (BL), 1991 and MBA in International Business, 2005. She has over 15 years extensive experience, as a professional in corporate practice. Before joining NAHCo in 2005, she had worked with Bullion Nominees Ltd and Lasaco Assurance PLC. She is an Associate Member of the Nigerian Institute of Management.

Femi Oroyemi Marketing and Business Development Manager

Femi Oroyemi has a B.Sc in Mathematics (1988) and a Post Graduate Diploma in Management (2000), both from the Obafemi Awolowo University, Ile-Ife. In addition, he holds a Diploma in Computer Science and Masters in Business Administration from Abubakar Tafawa Balewa University, Bauchi (2001) specializing in Marketing.

He joined NAHCo in 1992 and has first order experience in core ground handling operations, marketing and business development. He is an Associate Member of the Nigerian Institute of Management.

5.6 Market Share

Despite facing strong competition from its sole competitor in the industry, NAHCo remains the leading provider of Aviation Handling services. Leveraging on its position as the incumbent Aviation Handling Services provider, presently servicing most of the foreign airlines, NAHCo is pursuing an aggressive market development strategy as it intends to extend its services to local airlines in Nigeria as well as other airlines and airports in the West African sub-region.

5.7 Future Prospects

NAHCo is currently implementing a three-year Corporate Business Plan (2007–2009) which is aimed at re-positioning its brand in the market place, consolidating market leadership, breaking new grounds and increasing stakeholder value. In line with these expectations, arrangements have been completed to expand operations to other airports in Nigeria. These include the newly completed Terminal 2 of the Murtala Muhammed Airport, Ikeja, Calabar, Enugu, Benin, Yola, and Sokoto.

The company is also exploring the possibility of moving into the West African Sub-region either directly or in partnership with other ground handling companies. NAHCo will in the next one year consolidate on-going plans to enter into strategic partnerships and alliances that will not only enhance its capability in the local market, but will also open up opportunities at the global level. In addition, efforts are on to broaden the company’s income-base through diversification to other services such as courier, travel and tours.

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*Note: The new equipments include: 3 Push Back Tractors, 3 Lower Deck Loaders, 8 Belt Loaders, 9 Ground Power Units, 3 Air Start Units, 5 Toilet Service Trucks, 26 Baggage Tractors, 8 Mobile Passenger Steps, 2 Toilet Service Trucks (towable), 6 Water Service Trucks, 60 Baggage Carts, 9 Forklifts, 70 Pallet Dollies and 5 High Loaders


5.8 Premises

Nigerian Aviation Handling Company Plc's head office is situated at NAHCo house, Murtala Muhammed International Airport, Ikeja, Lagos. Other premises are listed below. A schedule of the principal premises in which the Company has beneficial interest is available for inspection at the offices of the Lead Issuing House. S/n Location of Property Description Type Year of Expiration 1 NAHCo House,

Murtala Muhammed International Airport Ikeja, Lagos

Head Office Leasehold 2036

2 Nnamdi Azikiwe International Airport, FCT Abuja

Outstation Leasehold

3 Mallam Aminu Kano International Airport, Kano, Nigeria.

Outstation Leasehold 2015

4 Port Harcourt International Airport, Port Harcourt, Rivers State

Outstation Leasehold 2033

5 Murtala Muhammed International Airport Ikeja, Lagos

Cargo Administrative Complex Leasehold 2026


Courier Shed Warehouse Leasehold 2028


Export/Import Bonded Warehouse Leasehold 2013


Transhipment Centre Leasehold 2016

9 82 Oyewole Street Mulero, Agege Lagos

Block of Flats Outright Purchase

10 Mallam Aminu Kano International Airport, Kano, Nigeria.

Development Area with Fuel Station and car park

Leasehold 2015

5.9 Purpose of the Offer

The Public Offer (and the concurrent Right Issue) is being undertaken to provide funding for the company’s growth strategy which include creating new services, acquiring new equipments*, extending the company’s technology platform, completing new cargo sheds, building brand recognition and increasing the working capital to support the expected expansion.

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5. The Chairman’s Letter (cont’d) 5.10 Financial Summary

The financial summary provided below has been prepared from the information extracted from the Reporting Accountants’ Report on financial statements of NAHCo for the five years ended 31 December 2006 and the Reporting Accountants’ Report on the Profit Forecast of the NAHCo Plc for the years ending 31 December 2007, 2008 and 2009.

FINANCIAL SUMMARY

As at 31st December 2006 2005 2004 2003 2002

N=’000 N=’000 N=’000 N=’000 N=’000

Turnover 3,245,553 3,050,539 2,343,618 2,173,277 1,851,277 Gross Profit 1,342,020 1,734,408 1,089,859 960,855 751,453

Profit on ordinary activities before taxation 555,946 457,728 155,307 194,314 204,858

Taxation (121,829) (140,000) (55,319) (55,621) (46,479) Profit on ordinary activities after taxation 434,117 317,728 99,988 138,693 158,378 Appropriations: Dividend (90,000) (90,000) (72,431) (146,417) (124,460) Retained profit for the year 344,117 227,728 27,557 (7,724) 33,917

Dividend per share – (Kobo) 0.30 0.30 0.62 1.25 1.06

Earnings per share – (Kobo) 1.48 1.06 0.48 0.98 0.83 Earnings per share and price earnings ratio are based on 150,000,000 Ordinary Shares of N1 each for 2002, 2003 and 2004 and 300,000,000 Ordinary shares of 50 kobo each for 2005 and 2006.

FORECAST STATISTICS As at 31st December 2007 2008 2009 N=’000 N=’000 N=’000 Turnover 3.798.000 5.270.000 6.587.000 Gross Profit 1.681.000 2.273.000 2.959.000 Profit before taxation 819.000 1.184.000 1.789.000 Profit after taxation 557,000 805,000 1,217,000 Proposed Dividend (394,000) (569,000) (572,000) Forecast earnings per share (kobo) 74 92 139 Forecast dividend per share (kobo) 53 65 65 Forecast earnings yield (at offer price) 10.51% 5.37% 8.08% Forecast dividend yield (at offer price) 1.69% 2.54% 3.67% Forecast dividend cover (times) 6.19 2.04 2.14 Price/earnings ratio (at offer price) 9.52 18.63 12.38 The Forecast basic earnings and dividend per share are based on 750,000,000 Ordinary Shares of 50 kobo each for 2007 and 875,000,000 Ordinary Shares of 50 kobo each for 2008 and 2009

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5. The Chairman’s Letter (cont’d) 5.11 Unclaimed Dividends

There are no unclaimed dividends accruing to shareholders of NAHCo as at the date of this Prospectus.

5.12 Corporate Governance

The Directors are responsible for the strategic direction of the Company, the identification and implementation of corporate policies and goals and monitoring of the business and affairs of the Company on behalf of its members. The Company subscribes to the Code of Best Practices on Corporate Governance in Nigeria. The full extent of the Company’s compliance with the Code is provided as follows: Responsibility of the Board of Directors NAHCo is in full compliance with all the duties and responsibilities of directors stated under Parts A, B and C of the Code. Composition of the Board The Board of NAHCo is composed of eleven (11) members made up of one (1) Executive Director and ten (10) non-Executive Directors. The Board members are professionals and entrepreneurs with vast experience and credible track records. Chairman and Chief Executive Officer Positions Responsibilities at the top of the Company are well defined and the Board is not dominated by one individual. The position of the Chairman is separate from the Chief Executive. The Chairman is not involved in the day-to-day operations of the Company. Proceedings and Frequency of Meetings The Board meets regularly. Sufficient clear agenda/reports are given ahead of such meetings. All Directors have access to the Company Secretary who can only be appointed or removed by the Board and is also responsible for the Board.

Non-Executive Directors The ten (10) non-Executive Directors are of strong calibre and contribute actively to Board deliberations and decision-making. However, non-Executive Directors are not appointed for a fixed period, but shall instead remain in office until the Company determines their tenure or by operation of law. Executive Directors The remuneration of the Chief Executive Officer is fixed by the Board. The Board Establishment Committee will be chaired by a non-Executive Director and composed of other non-Executive Directors. Full disclosure is provided for Directors’ remuneration i.e., the highest paid Director and remuneration of the Chairman. Reporting and Control The Board is responsible for and ensures proper finance reporting as well as the establishment of strong internal control procedures. The Board Audit Committee comprises of non-Executive Directors and representatives of shareholders. Shareholders’ Rights and Privileges The Directors ensure that shareholders’ statutory and general rights are protected at all times. Shareholders are responsible for electing the Directors at Annual General Meetings for which a notice of at least 21 days have been given.

Board committees To assist the Board in fulfilling its duties, the Board has established the following committees: – Technical Committee; – Strategic Planning, Finance & General Purpose Committee; and – Corporate Governance, Appointment and Establishment Committee.

5.13 Research and Development

NAHCo is currently undertaking feasibility studies for its business expansion activities in the Nigerian and Regional Markets. The Research effort will advise Board and Management on which new markets NAHCo should serve and what product/service offerings should be made available.

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5. The Chairman’s Letter (cont’d) 5.14 Mergers and Takeovers

As at the date of this Prospectus, there was no known merger or take over attempts on the Company by a third party or by the Company in respect of another company’s shares.

CONCLUSION This Offer represents a unique opportunity to invest in the flagship of the Aviation ground Handling Sector. Once again, on behalf of the Directors, I invite you to subscribe to the Offer. Yours faithfully, Ambassador (Dr.) Patrick Dele COLE, CON Chairman, Board of Directors Nigerian Aviation Handling Company Plc

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6. Details of the Offer

6.1 The Offer

This Prospectus invites applications for a total of 90,000,000 Ordinary shares of 50 kobo each at the Offer Price of N17.50 per share. 25,000,000 shares, representing 27.78% of the Offer, will be preferentially allotted to identified investors.

6.2 Purpose of the Offer

The Public Offer is being undertaken to provide funding for the company’s growth strategy which include creating new services, acquiring new equipments, extending the company’s technology platform, completing new cargo sheds, building brand recognition and increasing working capital to support the expected expansion.

6.3 Use of Proceeds

The gross proceeds of the Combined Offers is estimated at N2,152,500,000.00. The estimated net proceeds of N2,002,590,465.00 after deducting the costs of the issue, estimated at N149,909,535.50 (representing 6.96% of gross proceeds), will be applied as follows:

Purpose N’million % Estimated Completion Period Equipment Purchase 1,000 49.94 15 months

Information Technology 150 7.49 8 months

Cargo Sheds Completion 100 4.99 24 months

New Stations 100 4.99 6 months

Restructuring 430 21.47 6 months

Re-branding 100 4.99 6 months

Working Capital 137.91 6.12 Continuous

Total 2,002.59 100.00% * New stations will be located in Yola, Maiduguri, Jos, Kaduna, Katsina, Enugu, Sokoto, Benin and Calabar.

6.4 Arrangements for the Offer

At the Annual General Meeting of the Company held on 25th May 2007, the Directors of NAHCo proposed and the shareholders approved an Offer for Subscription of 90,000,000 Ordinary Shares of 50 kobo each to the general investing public and 35,000,000 Ordinary Shares of 50 kobo each to shareholders whose names appear in the company’s Register of Members as at 18th May, 2007.

6.5 How to subscribe for shares in the Offer

Kindly ensure that you read carefully, the “Instructions for Completing the Application Form” on page 59 of this Prospectus.

6.6 Allotment

The Issuing Houses and the Directors of the Company reserve the right to accept or reject any application in whole or in part, for not complying with the conditions of the Offer. The allotment proposal will be subject to the clearance of the Securities & Exchange Commission.

6.7 Non-resident Investors

The distribution of this Prospectus in jurisdiction outside the Federal Republic of Nigeria may be restricted by the laws of such jurisdiction and persons who come into possession of this Prospectus should seek advice on and observe any such restrictions. Any failure to comply with such restrictions may constitute a violation of the applicable securities law of a foreign country.

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7. The Profit Forecast

7.1 Letter from the Reporting Accountants 7th August 2007 The Directors




The Directors Sterling Capital Limited 67, Marina Lagos Island Lagos


Dear Sirs

The profit forecast of Nigerian Aviation Handling Company Plc for which the directors are solely responsible, is set out on page 25.

We have reviewed the accounting policies and calculations adopted in arriving at the profit forecast.

In our opinion, the profit forecast, so far as the accounting policies and calculations are concerned, has been properly compiled on the basis of the assumptions made by the Board, which are set out on page 26 of the offer document and is presented on a basis consistent with the accounting policies normally adopted by the Company according to the historical cost convention. However, there will usually be differences between the estimated and actual results because events and circumstances frequently do not occur as expected and those differences may be material. We have no responsibility to update this report for events or circumstances occurring after the date of the report. Yours faithfully,

BDO Oyediran Faleye Oke & Co (Chartered Accountants) Reporting Accountants Lagos, Nigeria

25

7. Profit Forecast (cont’d)

7.2 PROFIT FORECAST FOR THE YEARS ENDING 31 DECEMBER 2007, 2008 AND 2009

The Directors are of the opinion that in the absence of unforeseen circumstances, and based on the assumptions set out on page 26, the profit before taxation for the years ending 31 December 2007, 2008 and 2009 will be as indicated below. If this forecast is achieved, appropriation therefrom will be approximately as follows:

2007 2008 2009 N’000 N’000 N’000

Turnover 3,798,000 5,270,000 6,587,000 Operating costs (2,117,000) (2,997,000) (3,628,000) Gross profit 1,681,000 2,273,000 2,959,000 Administrative expenses (862,000) (1,089,000) (1,170,000) Profit before taxation 819,000 1,184,000 1,789,000 Taxation (262,000) (379,000) (572,000) Profit after taxation 557,000 805,000 1,217,000 Proposed dividend (See Note 8.8.11) (394,000) (569,000) (572,000) Retained profit for the year 163,000 236,000 645,000 Per share data (Kobo) 2007 2008 2009 Dividend per N0.50 share 53k 65k 65k Basic earnings per N0.50 share 74k 92k 139k The forecast basic earnings and dividend per share are based on 750,000,000, ordinary shares of N0.50 each for 2007, and 875,000,000 shares of N0.50 each for 2008 and 2009.

26

7. Profit Forecast (cont’d)

7.3 Bases and Assumptions

Bases

(1) The profit forecasts have been prepared on a basis consistent with the accounting policies normally adopted by the Company.

(2) Previous years’ actual performance have been reviewed against budget as the basis for measuring the reasonableness of the forecasts for the

years ending 31 December 2007, 2008 and 2009.

Assumptions

The following underlying assumptions have been used for the Company’s profit forecasts.

(i) The Company will continue to enjoy the goodwill and patronage of its customers.

(ii) There will be no major labour dispute during the periods.

(iii) Turnover of the Company is expected to grow at 17%, 39% and 25% for 2007, 2008 and 2009 respectively.

(iv) The following Airlines will either join or increase their international route operations:

• Delta Air – (projected to join in December 2007) • Air France – (will increase frequency from July 2007) • Kenya airways – (will start operations from Abuja from August 2007)

(v) Expansion: NAHCo will focus more attention on Domestic Handling through the existing outstations and new outstations to be established by 3rd Quarter 2007 in:-

• LAGOS (MM2) • ABUJA • PORT HARCOURT • KANO • CALABAR • ENUGU • BENIN • KADUNA • JOS • MAIDUGURI

(vi) Operating costs are expected to grow at 1l%, 42% and 21% for 2007, 2008 and 2009 respectively.

(vii) Administrative expenses are estimated to grow at 1%, 26% and 7% for 2007, 2008 and 2009 respectively.

(viii) Changes in the political and economic environment will not adversely affect the Company’s business and there will be no material changes in the

monetary and fiscal policies of the Federal Government that will adversely affect the Company.

(ix) There will be no litigations with adverse consequences on the Company.

(x) There will be no new legislation affecting the Aviation Industry.

(xi) The quality of the Company’s Management will be sustained during the forecast periods.

(xii) Tax rates and basis of taxation will not materially change. Taxation is projected based on 32% of profit before tax for the periods (Education

Tax inclusive)

27

7. Profit Forecast (cont’d) 7.4 Letter from the Joint Issuing Houses The following is a copy of a letter from the Joint Issuing Houses on the Profit Forecast:

30th August, 2007

The Directors Nigerian Aviation Handling Company Plc NAHCo House Murtala Muhammed Airport Ikeja Lagos. Dear Sirs, NIGERIAN AVIATION HANDLING COMPANY PLC OFFER FOR SUBSCRIPTION OF 90,000,000 ORDINARY SHARES OF 50 KOBO EACH AT N17.50 PER SHARE We are writing with reference to the Prospectus issued in respect of the Public Offer of 90,000,000 Ordinary shares of 50 kobo each in Nigerian Aviation Handling Company Plc (“the Company”). The Prospectus contains forecasts of the Company’s profits for the three years ending 31st December, 2007, 2008 and 2009. We have discussed with you and BDO Oyediran Faleye Oke & Co, Reporting Accountants, the bases and assumptions upon which the forecasts were made. We have also considered the letter dated 7th August 2007 from the Reporting Accountants regarding the accounting bases and calculations upon which the forecasts were compiled. Having considered the assumptions made by you as well as the accounting bases and calculations reviewed by the Reporting Accountants, we consider that the forecasts (for which you as Directors are solely responsible) have been made by you after due and careful enquiry. Yours faithfully, FOR AND ON BEHALF OF THE ISSUING HOUSES Mr. Francis Esem Wood Dr. (Mrs) Cecilia A. O. Ibru Managing Director/CEO Managing Director/CEO FCMB Capital Markets Limited Oceanic Bank International Plc Mr. Albert E. Okumagba Mr. Biodun Dabiri Dr. F. N. Chukujama Managing Director Managing Director Managing Director BGL Securities Limited Sterling Capital Markets Limited Unex Securities & Investment Limited


RC 446561

RC269666

RC 147269

28

8. Financial Information

8.1 Reporting Accountants’ Report

The following is a copy of the Report of BDO Oyediran Faleye Oke & Co (Chartered Accountants), Reporting Accountants to the Offer:

7th August 2007 The Directors




The Directors Sterling Capital Markets Limited 67, Marina Lagos Island Lagos


Dear Sirs,

We have reviewed the audited financial statements of Nigerian Aviation Handling Company Plc (“The Company”) for the five years ended 31 December 2002 to 2006, in addition to our carrying out a limited review of the Company’s books of account for the same period. The financial statements from 31 December 2002 to 31 December 2004 were audited by Kehinde Osinowo and Co. (Chartered Accountants) while the financial statements for 31 December 2005 and 2006 were audited by Horwath Dafinone (Chartered Accountants). The Financial Statements were prepared under the historical cost convention and on the basis of accounting policies disclosed in the notes to the financial statements. Basis of Preparation The summarised profit and loss accounts, balance sheets and cashflow statements set out in the prospectus are based on the audited financial statements of the Company. No audited financial statements of the Company have been made up in respect of any period subsequent to 31 December 2006. Responsibility The financial statements are the responsibility of the Directors of Nigerian Aviation Handling Company Plc who approved the issue. The Directors of the Company are also responsible for the contents of the prospectus in which this report is included. It is our responsibility to compile the financial information set out in our report from the financial statements, to form an opinion on the financial information and to report our opinion to you.

29

8. Financial Information (contd.) Financial Information The evidence included that recorded by the auditors who audited the financial statements underlying the financial information for the years ended 31 December 2002 to 2006. Our work also included an assessment of significant estimates and judgements made by those responsible for the preparation of the financial statements underlying the financial information, and whether the accounting policies are appropriate to the circumstances of Nigerian Aviation Handling Company Plc, consistently applied and adequately disclosed. We planned and performed our work so as to obtain all the information and explanations which we considered necessary in order to provide us with sufficient evidence to give reasonable assurance that the financial information is free from material misstatement whether caused by fraud or other irregularities or error. Opinion In our opinion, based on our examination of the reports of Kehinde Osinowo & Co. (Chartered Accountants) of 187, Ikorodu Road, Palmgroove, Lagos, who were auditors from 31 December 2002 to 31 December 2004, and the reports of Horwath Dafinone (Chartered Accountants) of Ceddi Towers, 16 Wharf Road, Apapa, Lagos who were auditors for the years ended 31 December 2005 and 31 December 2006, the information set out in this report with respect to the years ended 31 December 2002 to 2006 give a true and fair view of the results of the Company for the periods stated.

Yours faithfully,


30

8. Financial Information (contd.) 8.2 Letter from the Reporting Accountants in respect of NAHCo’s Going Concern Status

7th August 2007 The Directors FCMB Capital Markets Limited Primrose Tower (4th Floor) 17A, Tinubu Street Lagos





Dear Sirs, CONFIRMATION OF THE GOING CONCERN STATUS Based on the information and confirmations received from the Directors of Nigerian Aviation Handling Company Plc, and our review of past results of the Company, as well as the existing operational position, the Directors of Nigerian Aviation Handling Company Plc believe that no material liabilities will emanate from the observations noted in our opinion page of the Accountants’ Report that will affect the going concern status of the Company. We are therefore of the opinion that the Company will continue as a going concern in the foreseeable future.

Yours faithfully,


31

8. Financial Information (contd.) 8.3 Letter from Directors on NAHCo’s Going Concern Status

7th August, 2007

The Directors FCMB Capital Markets Limited Primrose Tower (4th Floor) 17A, Tinubu Street Lagos


The Directors, BGL Securities Limited Plot 1061B, Abagbon Close Victoria Island Lagos



Dear Sirs, CONFIRMATION OF THE GOING CONCERN STATUS OF NIGERIAN AVIATION HANDLING COMPANY PLC The Directors of NAHCo are required to prepare financial statements at the end of each financial period, which give a true and fair view of the state of affairs, and of the profit and loss of NAHCo. They are also responsible for maintaining proper accounting records, for taking reasonable steps to prevent and detect fraud and other irregularities. The Directors are also responsible for selecting suitable accounting policies and applying them on a consistent basis, making judgements and estimates that are prudent and reasonable. Applicable accounting standards have been followed and NAHCo’s financial statements are prepared using accounting policies which comply with generally accepted accounting standards in Nigeria and the Companies and Allied Matters Act, 2004. The Directors of NAHCo, having made appropriate enquiries, reviewed budgets, projected cashflows and other relevant information, consider that adequate resources exist for the business to continue in operational existence for the foreseeable future and that, therefore, it is appropriate to adopt the going concern basis in preparing the financial statements. Yours faithfully,

MR. BATES SARKI SULE MRS. FOLASHADE ODE MANAGING DIRECTOR/CEO COMPANY SECRETARY

32

8. Financial Information (contd.) 8.4 Statement of Significant Accounting Policies i) Nature of Financial Information

The financial information set out in pages 34 – 44 below does not constitute statutory financial statements within the meaning of section 334 of the Companies and Allied Matters Act, 1990, but has been extracted from the audited financial statements of Nigerian Aviation Handling Company Plc for the financial years ended 31 December 2002, 2003, 2004, 2005 and 2006. The Auditors of Nigerian Aviation Handling Company Plc, Kehinde Osinowo & Co. (Chartered Accountants) of 187 Ikorodu Road, Palmgroove, Lagos and Horwath Dafinone (Chartered Accountants) of Ceddi Towers, 16, Wharf Road, Apapa, Lagos have audited and made their reports under section 359 of the Companies and Allied Matters Act, 1990 on the annual financial statements for each of the financial years ended 31 December 2002, 2003, 2004, 2005 and 2006 respectively. However, the financial statements for the year ended 31 December 2004 were qualified on the grounds that not enough information was available to verify the physical existence of certain fixed assets which were purchased for N119.6 million under the IMUSE Equipment and Cargo computerization projects. Statutory financial statements in respect of each of the financial years ended 31 December 2002, 2003, 2005 and 2006 have been delivered to the Corporate Affairs Commission.

ii) Significant Change

There has been no significant change in the business of the Company during the periods under review. iii) Accounting Policies

The financial information in this report has been prepared in accordance with the applicable Statements of Accounting Standards issued by the Nigerian Accounting Standards Board. The principal accounting policies adopted for the purpose of this financial information have been applied by the Company on a consistent basis.

iv) Statement of Accounting Policies

The following are the significant accounting policies adopted by the Company in the preparation of its financial statements.

33

8. Financial Information (contd.) Statement of Significant Accounting Policies (contd.) a) Basis of Accounting The financial statements are prepared under the historical cost convention. b) Depreciation

This is calculated to write off the cost of fixed assets on a straight line basis over their expected useful lives. The annual rates for different classes are as follows:

% Building 5 Plant and machinery 10 Motor vehicles 20 Furniture, fittings and equipment 10 Imuse, hermes and computer equipment 20 c) Debtors These are stated after making provision for debts considered doubtful of recovery. d) Stocks

These are valued at the lower of cost and net realisable value, after making adequate allowances for obsolete and slow moving items. e) Turnover Turnover represents the net value of services rendered to customers. f) Foreign exchange transactions

i) Transactions originating and completed during the year were converted at the rates prevailing at the time of completion.

ii) Overseas liabilities unpaid at year end were converted at the rates prevailing at the year end.

iii) Foreign currency cash and bank balances were converted at the rates prevailing at balance sheet date.

g) Branch operations

The capital and revenue returns of operations from the branches are incorporated into the financial statements of the Company on a consolidated basis.

h) Pension scheme

The Company in line with the provisions of the Pension Reform Act, 2004 has instituted a defined contribution pension scheme for its employees. Employees contribute 7.5% of their annual basic salary, housing and transport allowances. The Company’s contribution which is charged to the profit and loss account is 7.5% of the employees’ total emoluments.

34

8. Financial Information (contd.) 8.5 Balance Sheets The following is a summary of the Balance Sheets of the Company based on the audited financial statements of the Company for the years ended 31 December 2002 to 2006, after making such adjustments as, in our own opinion, are appropriate.

31/12/06 31/12/05 31/12/04 31/12/03 31/12/02 Notes N’000 N’000 N’000 N’000 N’000

ASSETS EMPLOYED Fixed assets 8.8.01 2,248,215 1,925,131 2,074,289 1,806,201 1,276,174 Investments 8.8.02 - - 7,420 7,420 7,420 2,248,215 1,925,131 2,081,709 1,813,621 1,283,594 CURRENT ASSETS Stocks 8.8.03 68,849 97,200 158,837 97,859 108,891 Debtors and prepayments 8.8.04 574,700 707,404 472,998 370,235 250,675 Deposits for fixed assets 8.8.05 417,551 187,171 - 151,525 309,234 Cash at bank and in hand 8.8.06 620,321 523,113 64,811 95,144 128,083 1,681,421 1,514,888 696,646 714,763 796,883 CURRENT LIABILITIES Borrowings 191,291 163,441 - 127 18,764 Creditors and accruals 8.8.07 1,329,063 1,183,412 1,142,955 979,706 572,015 Taxation 8.8.08 147,044 140,581 50,581 61,663 53,139 1,667,398 1,487,434 1,193,536 1,041,496 643,918 NET CURRENT ASSETS/ (LIABILITIES) 14,023 27,454 (496,890) (326,733) (152,965) TOTAL ASSETS LESS CURRENT LIABILITIES 2,262,238 1,952,585 1,584,819 1,486,888 1,435,559 Creditors: Amounts falling due after more than one year: Deferred retirement benefits 8.8.09 (875,001) (935,465) (845,427) (777,053) (720,000) Deferred tax 8.8.10 (263,000) (237,000) (187,000) (185,000) (184,000) Total Net Assets 1,124,237 780,120 552,392 524,835 532,559 REPRESENTED BY Share capital 8.8.12 150,000 150,000 150,000 150,000 150,000 Share premium 320 320 320 320 320 Revenue reserves 8.8.13 973,917 629,800 402,072 374,515 382,239 Shareholders’ funds 1,124,237 780,120 552,392 524,835 532,559

35

8. Financial Information (contd.) 8.6 Profit and Loss Account The following is a summary of the Profit and Loss accounts of the Company based on the audited financial statements of the Company for the years ended 31 December 2002 to 2006 after making such adjustments as in our opinion, are appropriate.

31/12/06 31/12/05 31/12/04 31/12/03 31/12/02 Notes N’000 N’000 N’000 N’000 N’000

Turnover 8.8.14 3,245,553 3,050,539 2,343,618 2,173,277 1,851,277 Cost of operations 8.8.15 (1,903,533) (1,316,131) (1,255,759) (1,212,421) (1,099,823) Gross profit 1,342,020 1,734,408 1,089,859 960,856 751,454 Administrative expenses 8.8.16 (856,744) (1,197,240) (981,202) (797,736) (598,985) Trading profit 485,276 537,168 106,657 163,120 152,469 Other income 94,547 71,196 77,284 44,692 68,624 579,823 608,364 183,911 207,812 221,093 Interest payable & similar charges (23,877) (42,318) (28,634) (13,498) (16,236) Exceptional item - (108,318) - - - Profit before taxation 555,946 457,728 155,307 194,314 204,057 Taxation 8.8.08 (121,829) (140,000) (55,319) (55,621) (46,479) Profit after taxation 434,117 317,728 99,988 138,693 158,378 Proposed dividend 8.8.11 (90,000) (90,000) (72,431) (146,417) (124,461) Retained profit/(loss) for the year 344,117 227,728 27,557 (7,724) 33,917 Retained profit brought forward 629,800 402,072 374,515 382,239 348,322 Retained profit carried forward 973,917 629,800 402,092 374,515 382,239 Retained profit 31/12/06 31/12/05 31/12/04 31/12/03 31/12/02 N’000 N’000 N’000 N’000 N’000 Balance per financial statements 959,366 615,249 506,975 434,544 390,809 Adjustment 1 (11,911) (11,911) (11,911) (11,911) (11,911) 2 5,079 5,079 5,079 5,079 5,079 3 (736) (736) (736) (736) (736) 4 (380) (380) (380) (380) -

5 (3,000) (3,000) (3,000) (3,000) - 6 25,500 25,500 25,500 - - 7 (1) (1) (119,455) (49,081) (1,002) 973,917 629,800 402,092 374,515 382,239

36

9 Financial Information (contd.) 8.7 Statement of Cash Flows The following is a summary of the cash flow statements of the Company based on the audited financial statements for the years ended 31 December 2002 to 2006 after making such adjustments which in our opinion, are appropriate:

2006 2005 2004 2003 2002 Notes N’000 N’000 N’000 N’000 N’000

Cash received from customers 3,505,642 2,819,722 2,255,109 2,068,683 1,779,577 Payments to suppliers and employees (2,658,126) (1,870,368) (1,693,251) (1,198,341) (1,390,063) Staff participatory scheme - - (13,130) (16,731) (16,967) Income tax paid 8.8.08 (89,366) - (64,401) (46,097) (33,298) Net cash inflow from operating activities 8.8.17 758,150 949,354 484,327 807,514 339,249 Cashflow from investing activities Additions to fixed assets (573,077) (246,343) (491,434) (742,905) (257,184) Proceeds from disposal of fixed assets 2,135 300 22 - - Cashflow from financing activities: Dividend paid (90,000) (245,009) (23,248) (97,548) (161,814) Net increase/(decrease) in cash and cash equivalents 97,208 458,302 (30,333) (32,939) (79,751) Cash and cash equivalents at January 1 523,113 64,811 95,144 128,083 207,834 Cash and cash equivalents at 31 December 8.8.06 620,321 523,113 64,811 95,144 128,083

37

8. Financial Information (contd.) 8.8 Notes to the Financial Statements 8.8.01 Fixed assets

31/12/06 31/12/05 31/12/04 31/12/03 31/12/02 Costs: N’000 N’000 N’000 N’000 N’000 Land and buildings 1,091,683 1,030,394 651,344 598,562 580,629 Plant and machinery 1,443,435 1,152,949 1,158,354 957,575 604,077 Motor vehicles 116,865 110,964 98,318 98,867 93,187 Furniture, fittings and equipment 143,908 124,311 698,235 549,034 315,507 Imuse Hermes & computer equipment 437,969 407,866 - - - Capital work in progress 376,242 238,709 470,219 386,923 275,608 3,610,102 3,065,193 3,076,470 2,590,960 1,869,008 Depreciation: Land and buildings 313,700 264,839 233,710 201,143 171,215 Plant and machinery 648,002 545,451 456,375 340,539 218,344 Motor vehicles 84,537 85,036 81,511 80,453 80,322 Furniture, fittings and equipment 60,196 56,512 230,585 162,623 122,953 Imuse Hermes & computer equipment 255,452 188,224 - - - Capital work in progress - - - - - - 1,361,887 1,140,062 1,002,181 784,758 592,834 Net book values: Land and buildings 777,983 765,555 417,633 397,418 409,414 Plant and machinery 795,433 607,498 701,979 617,035 385,734 Motor vehicles 32,328 25,928 16,807 18,414 12,866 Furniture, fittings and equipment 83,712 67,799 467,651 386,411 192,553 Imuse Hermes & computer equipment 182,517 219,642 - - - Capital work in progress 376,242 238,709 470,219 386,923 275,607-

2,248,215 1,925,131 2,074,289 1,806,201 1,276,174

i) The land on which the structures of NAHCo are built belongs to the Federal Airports Authority of Nigeria (FAAN). NAHCo has a leasehold right

over the properties for 30 years. ii) The capital work in progress amounting to N376,242,839 as at 31 December 2006 comprises: N’000 a) Warehouse in Port – Harcourt 7,186,357 b) Cargo warehouse 205,799,193 c) Cargo shed computerisation 1 41,077,389 d) Administrative block 21,779,900 e) Headquarter building 400,000 376,242,839

38

8. Financial Information (contd.) Notes to the Financial Statements 8.8.02 Investments

31/12/06 31/12/05 31/12/04 31/12/03 31/12/02 N’000 N’000 N’000 N’000 N’000 Expenses and equity contributed by the Company towards the formation of Nigerian Domestic Aviation Handling Company Limited (NIDAH) - - 7,420 7,420 7,420 Expenses incurred by the Company in the formation of Trans Africa Aviation Services Limited UK - - 1,138 1,138 1,138 Less: - - 8,558 8,558 8,558 Write off in Trans Africa Aviation Services - - (1,138) (1,138) (1,138) -

- - 7,420 7,420 7,420 8.8.03 Stocks

31/12/06 31/12/05 31/12/04 31/12/03 31/12/02 N’000 N’000 N’000 N’000 N’000

Plant and equipment (Spare parts) 105,655 101,728 92,331 83,908 84,836 Motor vehicles (Spare parts) - 1,516 42,544 14,431 18,896 Electrical (Spare parts) - 4,251 34,257 9,454 8,533 Stationery 17,284 - - - - Medical 635 - - - - Less: 123,579 107,495 169,132 107,793 112,265 Provision for slow moving items (54,350) (9,915) (9,915) (9,554) (3,374) - 69,229 97,580 159,217 98,239 108,891 Balance per financial statements 69,229 97,580 159,217 98,239 108,891 Adjustment 2 (380) (380) (380) (380) - 68,849 97,200 158,837 97,859 108,891 8.8.04 Debtors and prepayments

31/12/06 31/12/05 31/12/04 31/12/03 31/12/02 N’000 N’000 N’000 N’000 N’000

Trade debtors 8.04.1 499,629 791,261 544,708 444,396 328,312 Less: Provision or bad and doubtful debts (110,697) (142,240) (126,504) (114,701) (103,211) 388,932 649,021 418,204 329,695 225,101 Other debtors and prepayments 8.04.2 185,768 58,383 54,794 40,540 25,574 574,700 707,404 472,998 370,235 250,675 8.8.04.1 Trade debtors

31/12/06 31/12/05 31/12/04 31/12/03 31/12/02 N’000 N’000 N’000 N’000 N’000

Balance per financial statements 511,540 803,172 556,619 456,307 340,223 Adjustment 2 (11,911) (11,911) (11,911) (11,911) (11,911) 499,629 791,261 544,708 444,396 328,312

39

8. Financial Information (contd.) Notes to the Financial Statements 8.8.04.2 Other debtors and prepayments

31/12/06 31/12/05 31/12/04 31/12/03 31/12/02 N’000 N’000 N’000 N’000 N’000

Balance per financial statements 183,689 56,304 52,715 38,461 20,495 Adjustment 3 5,079 5,079 5,079 5,079 5,079 Adjustment 4 (3,000) (3,000) (3,000) (3,000) - 185,768 58,383 54,794 40,540 25,574 8.8.05 Deposit for fixed assets

31/12/06 31/12/05 31/12/04 31/12/03 31/12/02 N’000 N’000 N’000 N’000 N’000

417,551 187,171 - 151,525 309,234

The deposit for fixed assets represents deposits for operational equipment yet to be supplied.

8.8.06 Cash at bank and in hand 31/12/06 31/12/05 31/12/04 31/12/03 31/12/02 N’000 N’000 N’000 N’000 N’000

Balances in foreign currency 46,959 308,277 36,317 68,165 106,024 Balances held in local banks (8.06.1) 572,771 213,904 27,809 25,559 21,847 Cash in hand 591 932 685 620 212- 620,321 523,113 64,811 95,144 128,083 8.8.06.1 Balances held in local bank

31/12/06 31/12/05 31/12/04 31/12/03 31/12/02 N’000 N’000 N’000 N’000 N’000

Balance per financial statements 573,507 214,640 28,545 26,295 22,583 Less: Adjustment 5 (736) (736) (736) (736) (736) - 572,771 213,904 27,809 25,559 21,847 8.8.07 Creditors and accruals

31/12/06 31/12/05 31/12/04 31/12/03 31/12/02 N’000 N’000 N’000 N’000 N’000

Trade creditors 134,396 158,648 727,133 638,869 353,543 Other creditors and accruals 1,104,667 934,764 232,398 121,036 27,694 Dividend payable - - 172,578 195,825 172,889 Staff participatory scheme account - - 10,846 23,976 17,889 Proposed dividend 90,000 90,000 - - - 1,329,063 1,183,412 1,142,955 979,706 572,015 8.8.08(i) Taxation Provision for current 31/12/06 31/12/05 31/12/04 31/12/03 31/12/02 assessment year: N’000 N’000 N’000 N’000 N’000 Company income tax 81,000 75,000 42,151 45,518 39,438 Education tax 17,000 15,000 8,430 9,104 7,041 Over/Underprovision (2,171) - 2,738 - - Deferred taxation 26,000 50,000 2,000 1,000 - 121,829 140,000 55,319 55,621 46,479 Outstanding liability brought forward 140,581 50,581 61,663 53,139 39,958 236,410 140,581 114,982 107,760 86,437 Payments in the year (89,366) - (64,401) (46,097) (33,298) - 147,044 140,581 50,581 61,663 53,139

40

8. Financial Information (contd.)

Notes to the Financial Statements 8.8.09 Deferred retirement benefits 31/12/06 31/12/05 31/12/04 31/12/03 31/12/02 N’000 N’000 N’000 N’000 N’000 Balance at beginning of the year 935,465 845,427 777,053 720,000 705,110 Addition during the year 201,656 90,038 68,374 57,053 14,890 Payments in the year (262,120) - - - - Balance outstanding at year end 875,001 935,465 845,427 777,053 720,000 8.8.10 Deferred taxation 31/12/06 31/12/05 31/12/04 31/12/03 31/12/02 N’000 N’000 N’000 N’000 N’000 Balance at beginning of the year 237,000 187,000 185,000 184,000 184,000 Change for the year 26,000 50,000 2,000 1,000 - Balance at end of the year 263,000 237,000 187,000 185,000 184,000 8.8.11 Proposed dividend

In order to ensure systematic and consistent basis of accounting for provisions, contingent liabilities and contingent assets in financial statements, the Nigerian Accounting Standards Board on 1 June 2006, issued Statement of Accounting Standard Number 23 on accounting treatment of provisions, contingent liabilities and contingent assets. The standard became operative for financial statements covering periods ending on or after 31 December 2006. The standard requires that a provision can only be recognised in the financial statements which an entity has a present obligation arising from a past event. For proposed dividends, a present obligation only arises when such proposed dividends have been approved by the shareholders at the annual general meeting. Consequently, proposed dividends which hitherto had been recognised as liabilities in the financial statements of the financial year for which they were proposed will now only be recognised as liabilities in the financial statements in the year in which they are declared. Proposed dividends not yet approved by the shareholders will no longer be included in the profit and loss account, but are to be disclosed as a note in the financial statements.

(a) This change in accounting policy has been

recognised retrospectively: 2006 2005 N’000 N’000

Proposed dividend as previously reported

Effect of adoption of SAS 23 - -

- add/(deduct) proposed dividend for 2005 but declared in 2006 90,000 -

- add final dividend proposed in 2004 but declared in 2005 - - 90,000 -

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Notes to the Financial Statements (b) The movement on the dividend payable account is as follows: 2006 2005 N’000 N’000

Balance at the beginning of the year - As previously stated 90,000 - Effect of adoption of SAS 23 (Note 8.8.11(a) )

- Deduct proposed not declared at the beginning

of the year (90,000) -

- As restated - -

Proposed dividend declared 90,000 -

Payments during the year (90,000) -

Balance at the end of the year - -

8.8.12 Share capital 31/12/06 31/12/05 31/12/04 31/12/03 31/12/02 Authorised: N’000 N’000 N’000 N’000 N’000 300,000,000 Ordinary shares of N0.50 each issued and fully paid 150,000 150,000 150,000 150,000 150,000

N’000 N’000 N’000 N’000 N’000 Issued and fully paid: 300,000,000 Ordinary shares of N0.50 each 150,000 150,000 150,000 150,000 150,000 8.8.13 Revenue reserves 31/12/06 31/12/05 31/12/04 31/12/03 31/12/02 N’000 N’000 N’000 N’000 N’000 Retained profit/(loss) for the year 344,117 227,728 27,557 (7,724) 33,917 Retained profit brought forward 629,800 402,072 374,515 382,239 348,322 973,917 629,800 402,027 374,515 382,239 8.8.14 Turnover

31/12/06 31/12/05 31/12/04 31/12/03 31/12/02 N’000 N’000 N’000 N’000 N’000 Shareholders 463,913 318,042 263,647 265,039 197,811 Client airlines 1,629,145 1,750,174 1,410,549 1,316,925 1,229,165 Cargo shed operations 833,115 706,856 471,152 434,848 298,213 Maintenance 8,369 2,698 1,408 894 930 Pax Computerisation 104,928 104,501 87,198 47,888 42,631 Crew transportation 5,014 8,209 12,876 12,262 6,150 Courier services 128,568 123,247 73,388 53,616 48,129 Equipment rental 72,501 36,812 23,400 41,805 28,248 3,245,553 3,050,539 2,343,618 2,173,277 1,851,277

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Notes to the Financial Statements 8.8.15 Cost of operations

31/12/06 31/12/05 31/12/04 31/12/03 31/12/02 N’000 N’000 N’000 N’000 N’000

Accommodation charges 133,473 44,406 176,312 40,783 40,292 Aircraft equipment maintenance - - - 295 200 Computer expenses 4,475 6,444 34,366 18,761 10,366 Concession fees 162,263 151,939 117,181 108,664 92,564 Cargo shed expenses 16,653 18,556 19,523 24,629 16,217 DCS % Check in counters expenses - - 117,394 118,102 132,126 Depreciation: Plant and machinery 110,190 122,986 115,835 122,196 68,727 Maintenance workshop - - 765 765 765 Machine and equipment hire 6,131 11,061 9,936 5,178 1,444 Machine and equipment spare parts 151,420 155,675 199,908 135,253 102,727 Machine and equipment repairs 2,632 73,887 2,103 174,207 271,681 Payroll cost 1,177,124 626,053 418,325 396,843 351,602 Ramp expenses 12,582 3,895 2,761 5,013 2,139 Imuse expenses 91,244 93,425 Securities charges 5,793 5,778 12,965 6,226 4,606 Staff uniforms and overalls 29,553 2,026 28,385 55,506 4,367 1,903,533 1,316,131 1,255,759 1,212,421 1,099,823 8.8.16 Administrative expenses

31/12/06 31/12/05 31/12/04 31/12/03 31/12/02 N’000 N’000 N’000 N’000 N’000

Advertising and publicity - - 1,614 2,331 2,153 Audit fees 5,000 11,000 5,000 5,000 4,000 Bad and doubtful debts - - 11,803 11,491 13,371 Loss on investment - - - - 8,558 Board expenses 119,273 112,733 140,827 56,746 75,128 Business insurance 15,248 35,384 41,961 22,488 14,688 Business promotion and corporate gifts 40,816 16,410 43,988 24,687 21,668 Depreciation: Buildings 50,443 30,948 31,803 29,164 28,267 Furniture, fittings and equipment 74,626 118,580 69,824 56,894 31,551 Motor vehicles 9,346 5,272 1,387 1,387 18,638 Fuel and oil expenses 96,838 72,554 64,070 55,819 42,293 Hotel and lodging - - 567 20,758 24,521 ITF levy/Overseas training 47,824 31,260 19,696 26,285 23,769 Laundry and cleaning 2,031 1,524 2,319 3,802 2,024 Legal charges and expenses 21,956 21,474 35,773 15,945 8,174 Loss on disposal - - 3,711 - - Medical expenses 9,205 15,536 11,883 12,234 12,043 Exchange profit - - - (35,241) Motor running costs 17,119 17,052 20,503 19,782 14,829 Office and house accommodation charges 5,745 1,360 1,500 1,914 1,592 Office maintenance 30,653 17,057 17,112 8,533 5,283 Office equipment maintenance 2,294 3,555 3,398 9,690 4,176 Other professional charges 45,868 80,465 51,247 23,036 16,365 Payroll costs 103,060 479,189 258,751 224,501 100,656 Postages and communications 3,592 1,789 12,587 23,366 17,499 Printing, photocopying and stationery 1,398 16,272 27,864 20,029 12,866 Staff welfare and meal expenses 18,672 16,924 16,061 25,718 14,574 Transport, traveling and airfare 61,981 32,666 71,898 116,054 64,487 Water, gas and electricity - - 12,186 10,512 6,888 Newspapers and periodicals 2,471 2,104 1,869 1,431 1,355 Utilities 69,146 54,161 Donation and subscription 2,139 1,971 Miscellaneous expenses - - - 3,380 7,569- 856,744 1,197,240 981,202 797,736 598,985

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Notes to the Financial Statements Miscellaneous expenses

31/12/06 31/12/05 31/12/04 31/12/03 31/12/02 N’000 N’000 N’000 N’000 N’000

Balance per financial statements - - - - - Adjustment 2 - - - - 11,911 Adjustment 3 - - - - (5,079) Adjustment 5 - - - - 736 Adjustment 1 - - - 380 - Adjustment 4 - - - 3,000 - - - - 3,380 7,569 8.8.17 Net cash provided by operating activities

31/12/06 31/12/05 31/12/04 31/12/03 31/12/02 N’000 N’000 N’000 N’000 N’000

Profit after taxation 434,117 317,728 99,988 138,693 158,378 Adjustments to reconcile net profit to net cash provided by operating activities: Depreciation 244,606 277,786 219,613 210,405 139,627 Increase/(decrease) in taxes payable 32,463 140,000 (9,082) 9,524 13,181 Loss on disposal 3,252 - 3,711 - - Exceptional item - 108,318 - - - Investment provision - 7,420 - - - Investment in fixed assets - 117,415 - - - 714,438 968,667 314,230 358,622 311,186 Changes in assets and liabilities Decrease/(increase) in stock 28,351 61,637 (60,978) 11,032 (76,438) Decrease/(increase) in debtors and prepayments 132,704 (234,406) (102,763) (119,560) 17,946 Increase in creditors and accruals 145,651 87,148 114,066 361,295 164,008 (Increase)/decrease in deposit for fixed assets (230,380) (187,171) 151,525 157,709 (106,007) Increase/(decrease) in borrowing 27,850 163,441 (127) (18,637) 13,664 Decrease/(increase) in deferred employees emoluments (60,464) 90,038 68,374 57,053 14,890 Net cash provided by operating activities 758,150 949,354 484,327 807,514 339,249 8.7.18 Contingent liabilities Balance at the end of the year 187,307 220,513 373,192 420,163 420,163 These represent estimated liabilities in respect of pending legal cases as at each year end for which no provision has been made in the financial statements.

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Notes to the Financial Statements - SCHEDULE OF ADJUSTMENTS Dr. Cr. N N 1. Profit and loss account – unidentified debtors (2002) 11,911,191

Balance sheet – debtors (2002) 11,911,191 Being unidentified debtors written off to profit

and loss account 2. Balance sheet – Prior year adjustment (other debtors) 4,253,000 - Unidentified difference (other debtors) (2002) 825,500 Profit and loss account (2002) 5,078,500 Being amount written back to profit and loss account. 3. Profit and loss account – unidentified balance

(cash and bank) (2002) 735,778 Balance sheet – Cash and bank (2002) 735,778 Being unidentified balance written off. 4. Profit and loss account – stock overstated (2003) 380,000 Balance sheet – stock (2003) 380,000 Being stock of condenser overstated. 5. Profit and loss account – prepaid legal charges (2003) 3,000,000

Balance sheet – prepaid legal charges (2003) 3,000,000 Being initial expenses in respect of legal charges

written off.

6. Balance sheet – Trade creditors (2004) 25,500,000 Profit and loss account – other income (2004) 25,500,000 Being amount owed Tayo Laleye & Co. on ATSSAN and NAHCo vs NCP and BPE now written back.

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9. Statutory and General Information

9.1 Incorporation and Share Capital History

NAHCo was incorporated as a private limited liability company on 6th December, 1979 with a share capital of N2,000,000 divided into ordinary shares of N1.00 each. The Company was converted to a public limited liability company on 4th August, 2005.

The authorised share capital of the Company is N500 million (divided into 1 billion ordinary shares of 50 kobo each), of which all 750 million shares have been issued and fully paid up. Presently, the Nigerian public holds 60% of the issued share capital of NAHCo while foreign airlines hold the remaining 40% of the Company’s share capital. The entire share capital of the Company has been registered with the Securities and Exchange Commission in compliance with the CAMA and the ISA.

The following changes have subsequently taken place in the Company’s authorised and issued share capital:

Date Authorised (N) Issued and fully paid (N) Consideration Increase Cumulative Increase Cumulative 1979 2,000,000 2,000,000 2,000,000 2,000,000 Cash 1991 8,000,000 10,000,000 8,000,000 10,000,000 Bonus (4 for 1) 1994 15,000,000 25,000,000 15,000,000 25,000,000 Bonus (3 for 2) 1994 5,000,000 30,000,000 5,000,000 30,000,000 Bonus (1 for 5) 1997 120,000,000 150,000,000 120,000,000 150,000,000 Bonus (4 for 1) 2005 0 150,000,000 0 150,000,000 Stock Split 2007 200,000,000 500,000,000 225,000,000 375,000,000 Bonus (3 for 2 )

9.2 Beneficial Ownership

NAHCo’s issued and fully paid share capital, as at the date of this document, is N375,000,000 comprising 750,000,000 Ordinary shares of 50 kobo each and are beneficially held as follows:

Current Shareholders Shareholding % Shareholding Nigerian Public 450,000,000 60 Air France 93,750,000 12.5 British Airways 93,750,000 12.5 Sabena Air (represented by its Trustee in bankruptcy) 60,000,000 8 Lufthansa 52,500,000 7 Total 750,000,000 100

Except as stated above, no other shareholder holds more than 5% of the issued share capital of the Company. 9.3 Directors’ Beneficial Interests

The interests of the Directors of NAHCo Plc in the issued share capital of the Company as recorded in the Register of Members as at the date of this Prospectus and as notified by the Directors for the purposes of Section 275 of the Companies and Allied Matters Act, Cap C20 LFN 2004 are as follows:

Directors Direct Shareholding Indirect Shareholding

% Holding

Ambassador (Dr.) Patrick Dele Cole 250,000 - 0.033 Alhaji Suleiman Yahyah 1,263,250 - 0.168 Mr. Bates Sarki Sule 255,000 - 0.034 Mr. Mobolaji Balogun 3,141,880 - 0.4 Arc. Usman Arabi Musa Bello 25,000 - 0.003 Mr. Sylvanus Pyam Yakubu Gang 250,000 - 0.033 Mr. Denis Hasdenteufel 93,750,000 12.5 Mr. Thomas Mueller - 52,500,000 7.0 Mr. Osita Apollos Onyenwe 2,500 - 0.0003 Mr. Brett Silver - 93,750,000 12.5

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9. Statutory and General Information (cont’d) 9.4 Indebtedness

As at 31st December 2006, the Company had no outstanding debentures, mortgages, charges or similar indebtedness or material contingent liabilities other than in the ordinary course of business. However, the Company had contingent liabilities from pending suits against the Company which are not expected to exceed N216,693,603.56.

9.5 Subsidiaries and Associated Companies

As at the date of this document, NAHCo has no subsidiaries or associated companies

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9. Statutory and General Information (cont’d)

9.6 Extracts from the Memorandum and Articles of Association

Below are relevant extracts from NAHCo’s Memorandum and Articles of Association:

Memorandum of Association 4 The company is a public company. 6 The share capital of the company is N500,000,000.00 (Five Hundred Million Naira) divided into 1,000,000,000 (One Billion)

ordinary shares of 50 kobo each, with power to increase the capital and to divide the capital for the time being into several classes, and to attach thereto any preferential, deferred qualified or special rights privileges or conditions.

Articles of Association Share Capital 3: The company may from time to time issue classes of shares. It shall be the responsibility of the Directors to determine the classes

of shares to be issued. All the rights or restrictions attached to each particular class of shares shall be specified in the terms of issue but such rights may at any time be varied in accordance with the provisions of section 141 of the Act.

5: Every registered member shall without payment be entitled to receive within three (3) months after allotment or registration of transfer a certificate under the seal of the Company specifying the shares allotted or transferred to him and the amount paid up there on, provided that in this case of joint holders the Company shall not be bound to issue more than one certificate to all the joint holders, and delivery of such certificate to any one of them shall be sufficient delivery to all.

Call on Shares

12:

The Directors may, subject to the regulations of this Article and to any conditions of allotment, from time to time make such calls upon the shareholders in respect of all moneys unpaid on their shares as they think fit, and each shareholder shall pay to the company the amount called on the shares provided that at least 14 days notice shall be given to the shareholder specifying the time and place of payment.

Transfer and Transmission of Shares

17: Subject to the provision hereinafter contained, the transfer of any share in the company shall be done in the manner prescribed by the rules and regulations of the relevant exchange and regulatory authorities in force from time to time. The transferor shall be deemed to remain the holder of a share until the name of the transferee is entered in the Register of Members in respect thereof. Shares of different classes shall be paid to the company in respect of the registration of any transfer.

18: The instrument of transfer of a share shall be signed both by transferor and the transferee, and the transferor shall be deemed to remain the holder of the share until the name of the transferee is entered in the Register of Members in respect thereof.

19: The Directors may in their absolute discretion and without assigning any person thereof decline to register any transfer of shares on which the company has a lien. The Directors may also suspend the register of transfers during the fourteen days immediately preceding the Annual General Meeting in each year. The Directors may refuse to register any instrument of transfer unless: -

a. A fee not exceeding such sum as the Directors may from time to time determine is paid to the company in respect of each transaction by the transfer or (provided, however, that the transferee shall be responsible for any and all fees and out of pocket expenses required to fulfill any statutory requirements arising from the sale or transfer of shares so registered by the company); and

b. The instrument of transfer is accompanied by the certificate of the shares to which it relates, and such other

evidence as the Directors may reasonably require to show the right of the transferor to make the transfer and if the Directors refuse to register a transfer of any share they shall within two months after the date on which the transfer was lodged with the company send to the transferee notice of the refusal.

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Extracts from the Articles of Association

20: Subject to applicable law, the rules of the Exchange in force from time to time, and such regulations as the Directors may make from time to time, every member shall be entitled: -

a. Without payment to one certificate for all his shares of each class and when part only of the shares comprised in a certificate is sold or transferred to a new certificate for remainder of the shares so comprised, or

b Upon payment of such sum as the Directors may from time to time determine to several certificates, each for one or more of his shares of any class.

21: The company shall provide a book to be called the Register of Transfers, which shall be kept by the secretary under the control of

the Directors and in which shall be entered the particulars of every transfer or transmission of every share.

22: The transfer and other documents relating to or affecting the title of any shares shall be registered without payment of any fees.

23: The Register of Members may be closed during such period or periods as the Directors may think fit, not exceeding in the whole thirty days in each year

24: In the case of the death of a registered member, the survivors, or survivor (where the deceased was a joint holder) or the legal personal representative of the deceased (where he was a sole holder) shall be the only person recognized by the company as having any title to his shares. But nothing herein contained shall release the estate of a deceased holder (whether sole or joint) from any liability in respect of a deceased shareholder in certain cases.

25: Any person becoming entitled to a share in consequence of the death or bankruptcy of a member may upon such evidence being produced, as may from time to time be required by the Directors, have the right either to be registered as a member in respect of the share or instead of being registered himself, to make such transfer of the share as the deceased or bankrupt person could have made, but the Directors shall in either case, have the same right to decline or suspend registration as they would have had in the case of transfer of the share by the deceased or bankrupt person before the death or bankruptcy, as the case may be.

26: If the person so becoming entitled shall elect to be registered himself, he shall deliver or send to the company a notice in writing signed by him and stating that he so elects for all purposes of these articles relating to the registration of transfers of shares, such notices shall be deemed to be a transfer, and the Directors shall have the same power of refusing to give effect thereto by registration as if the event upon which the transmission took place had not occurred, and the notice were a transfer executed by the person from whom the transmission is derived.

27: If the person becoming entitled shall elect to have his nominee registered he shall testify his election by executing to his nominee a transfer of such share. The Directors shall have, in respect of transfer so executed, the same power of refusing registration as if the event upon which the transmission took place had not occurred, and the transfer were a transfer executed by the person from whom the title by transmission is derived.

28: Any person becoming entitled to a share in consequence of the death or bankruptcy of a member shall be entitled to receive and may give a good discharge for all dividends, bonuses or other moneys payable in respect thereof, but he shall not be entitled to receive notice of or to attend or vote at meetings of the Company or of holders of such shares or save as aforesaid to any of the rights or privileges of a member unless and until he shall have become a member in respect of such shares.

Conversion Of Shares Into Stock

39:

The Directors may from time to time, with the sanction of the company previously given in General Meeting, convert any paid-up shares into stock, and may from time to time, with the like sanction, re-convert such stock to paid up shares of any denomination.

43: Increase in Capital

The company may from time to time, in General Meeting whether all the shares for the time being authorized shall have been issued, or all the shares for the time being shall have been fully paid up or not, increase its capital by the creation and issue of new shares, such aggregate increase to be of such amount and to be divided into the shares of such respective amounts as the company by the resolution authorizing such increase directs and such shares shall rank pari-passu with the existing shares of the Company.

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47: Alteration of Capital

The company may by ordinary resolution in general meeting:

a. Consolidate and divide its capital into shares of larger amount than its existing shares; or

b. Cancel any shares, which at the date of the passing of the resolution have not been taken or agreed to be taken by any person and may by special resolution:

I. Subdivide its existing shares, or any of them or any part thereof, into shares of smaller amount than is fixed by its memorandum of Association, and so that as between the holders of the resulting shares one or more of such shares may by the resolution by which the sub-division is effected be given any preference or advantage as regards dividends, capital voting; or otherwise, over the others or any other such shares, or

II. Reduce its capital in any manner authorized by the Act.

Meetings

51:

52: The Company shall hold its statutory meeting within six months from the date of re-incorporation to a public.

A general meeting shall be held once in every year at such time (not being more than 15 months after the holding of the last preceding general meeting) and place as may be presented by the company in general meeting, or in default, by the Directors.

53: The Board of Directors may when it deems necessary convene meeting between one Annual General Meeting and the next to deliberate on matters that cannot wait until the next Annual General Meeting and such meetings shall be called Extraordinary.

54: The Company’s Statutory and Annual General Meeting shall be held in Nigeria.

Notice of Meetings 58: An Annual General Meeting and all General Meeting of the company shall be called by twenty-one days notice in writing at the least.

The notice shall be exclusive of the day on which it is signed or deemed to be served and of the day for which it is given and shall specify the place, the hour of meeting and, in case of special business, the general nature of that business shall be given, in a manner if any, as may be prescribed by the company in general meeting, to such person as are, under regulation of the company, entitled to receive such notices from the company. Provided that a meeting of the company shall notwithstanding that it is called by shorter notice than that specified in this regulation, be deemed to have been duly called if it is so agreed: -

a. In the case of a meeting called as the Annual General Meeting, by all the members entitled to attend and vote thereat; and

b. In the case of any other meeting, by a majority in number of the members having right to attend and vote at the meeting being majority together holding not less than 95 percent in normal value of the shares giving that right

PROCEEDINGS AT GENERAL MEETING

61: All business shall be deemed special that is transacted at an Extraordinary General meeting, and also all that is transacted at an Annual General Meeting, with the exception of declaring a dividend, the consideration of the Accounts, balance sheets, and the reports of the Directors and auditors, the election of Directors in place of those retiring and the appointment of and the fixing of the remuneration of the Auditors.

62: No business shall be transacted at any General meeting unless a quorum of members is present at the time when the meeting proceeds to business. The quorum shall be Twenty-five members personally present, or represented by proxy, holding not less than one-tenth of the issued capital of the company.

63: If within one hour from the time appointed for the holding of a general meeting a quorum is not present, the meeting, if convened on the requisition of members shall be dissolved.

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In any other case it shall stand adjourned to the same day in the next week, at the same time and place, and if at such adjourned meeting a quorum is not formed within fifteen minutes from the time appointed for holding the meeting members present shall be quorum

64: The chairman of the Board of the Directors shall preside at every General Meeting but if at any meeting he shall not be present within one hour after the time appointed for holding the same, or shall be unwilling to act as chairman, the members present shall choose a Director, or if no Director be present or if all Directors present decline to take the chair, they shall choose one of the members present to be chairman of the meeting

65: At any General Meeting a Resolution put to the vote of the meeting shall be decided on a show of hands unless a poll is (before or on the declaration of the result of show of hands) demanded by the Chairman or at least three members entitled to be at the meeting or by the holders present in person or by proxy of at least one-tenth part of the total voting rights of all the members having the right to vote at the meeting or by a member or members holding shares on which an aggregate sum has been paid up equal to not less than one-tenth of the total sum paid upon all the shares conferring that right. Unless a poll is demanded, a declaration by the Chairman that a resolution has on a show of hands been carried or carried unanimously, or by a particular majority or lost, and on entry to that effect in the minute book of the Company shall be conclusive evidence thereof without proof of or against such resolution. A proxy need not be a member of the Company.

66: Any Corporation which is a member of the Company may by resolution of its Directors or other governing body authorize such person as it thinks fit to act as its representative at any meeting or meetings of the Company or of any class of members of the Company, and the person so authorized shall be entitled to exercise the same powers on behalf of the Corporation which he represents as that corporation could exercise if it were an individual member of the company.

74: A proxy may take part in the proceeding of a General Meeting as if he were the member whom he represents.

Vote of Members 75: Vote may be given either personally or by proxy on a show of hands every member personally present shall have one vote only. In

case of a poll every member shall have one vote for every share held by him or proxy. 76: Any member of unsound mind, may vote, whether on a show of hands or at a poll by his committee, receiver

curator bonis or other legal curator, and such last-mentioned person may vote by proxy on a poll. 77: If two or more persons are jointly entitled to a share, then, in voting upon any question, the vote of a senior who tenders a vote,

whether in person or by proxy, shall be accepted to the exclusion of the votes of the other registered holders of the share, and for this purpose seniority shall be determined by the order in which the names stand in the Register of Members.

78: Save as here in expressly provided, no person other than a member duly registered, and who shall have paid everything for the time being due from him and payable to the company in respect of his shares, shall be entitled to be present or to vote on any question either personally or by proxy, or as proxy for another member, at any General Meeting.

79: Any member of the Cmpany entitled to attend and vote at a meeting of the company shall be entitled to appoint another person (whether a member or not) as his proxy to attend and vote instead of him, and a proxy appointed to attend and vote instead of a member shall also have the same right as the member to speak at the meeting.

80: The instrument appointing a proxy shall be in writing under the hand of the appointor or if such appointor, is a Corporation under their common seal, if any, and if none, then under the hand of some officer duly authorized in that behalf, or signed in such manner as the law under which such corporation is being incorporated shall prescribe for the execution of instruments by such corporation

Directors

84: Until otherwise determined by a General Meeting, the number of Directors shall not be less than Ten (10) and shall not be more than Thirteen, (13)

85: The Directors may from time to time appoint person to be a Director either to fill casual vacancy or by way of addition to the Board. Any Director appointed under this Article shall hold office only until the Annual General meeting following next after his appointment, but shall then be eligible for re-election.

86: The Company in General Meeting may from time to time direct such sum as may be thought fit to be paid as and by way of remuneration to the Directors and any such shall be divided amongst them as they may agree, or failing agreement, equally. The Directors shall also be entitled to be repaid all expenses reasonably incurred by them respectively in or about the performance of their duties as Directors

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87: It shall not be necessary for any Director of the Company to acquire or hold any share qualification, but a Director shall be entitled to receive notice, and to attend, all General Meeting. In the event of a Director being required to hold any qualification share or shares, he may act before he acquires his qualification, but he must acquire the same within one month from the date of his appointment as a Director, and unless he shall do so, he shall be deemed to take such shares from the company, and the same shall be allotted to him forthwith accordingly subject to his payment of the sum due on such shares.

88: Any member seeking the removal of a Director shall give a Special notice of his intended resolution to remove a Director at the general meeting, and the Company shall send a copy of the intended resolution to the Director concerned. The Director (whether or not he is a member of the Company) shall be entitled to be heard on the resolution at the meeting.

89: The Directors may continue to act, notwithstanding any vacancy in their body, provided always that in case the Directors shall at any time be reduced in number to less than five, it shall be lawful for them to act as Directors, for the purpose of filling up vacancies in their body or calling a General Meeting of the company, but not for other purpose.

90: The first Directors of the Company shall be appointed by the subscribers to the Memorandum of Association. Borrowing Powers 93: The Directors may exercise all the powers of the company to borrow money and to mortgage or charge its undertaking property,

and uncalled capital, or any part thereof and to issue debentures, debentures stock, and other securities whether outright or as security for any debt, liability or obligation of the company or of any third party as they deemed fit.

97: The Directors may borrow or raise any sum or sums of money upon such terms as to interest or otherwise as they may think fit, and for the purpose of securing the same and interest or for any other purpose create, issue, make and give respectively any perpetual or redeemable debentures, or any mortgage or charge on the undertaking or the whole or any part of the property, present or future, or uncalled capital of the company and any debentures and other securities may be made assignable free from any equities between the Company and the person to whom the same may be issued, provided that the Directors shall not without the sanction of a resolution of the Company in General Meeting borrow or raise any sum of money together with any borrowed or secured by any outstanding Company and for the time being make the amount so borrowed or raised by the Company and then outstanding, exceed two times the shareholder fund for the time being of the Company.

Powers Of Directors 98: The Directors, from time to time, and at any time, may provide through Local Boards, Attorneys or Agencies for the management of

the affairs of the company outside Nigeria, and may appoint any persons so appointed and appoint others in their place, and may fix their remuneration

99: The Directors, from time to time, and at any time may delegate to any such Local Board, Attorney or agents any of the powers, authorities and discretions for the time being vested in the Directors, other than the power to make calls, forfeit shares, borrow money or issue debentures and any such delegation may be made on such terms and subject to such conditions, as the Directors may think fit, and may include a power of sub-delegate, and the Directors may at any time annul or vary delegation, but no person dealing in good faith and without notice of such annulment or variation shall be adversely affected thereby .

100: The business of the company shall be managed by the Directors, who may pay all expenses which are preliminary and incidental to the promotion, formation, establishment and registration of the company as they think fit, and do on behalf of the company all such acts as may be exercised and done by the company, and as are not by the Act or Article required to be exercised or done by the company in General meeting subject nevertheless, to any regulations of these Article to the provisions of the Act, and to such regulations being not inconsistent with the aforesaid regulation or provision as may be prescribed by the company in General Meeting, but no regulation made by the company in General Meeting shall invalidate any prior act of the Directors which would have been valid if such regulations had not been made.

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Disqualification of Directors 103: The office of a Director shall be vacated-:

i. Upon his removal by an ordinary resolution. ii. If by notice in writing to the company he resigns his office of Director. iii. If he becomes bankrupt or insolvent or enters into any agreement with his creditors. iv. If he is prohibited from being a Director by an order made under any of the provisions of the Companies and

Allied Matters Act, 1990. v. If he be found lunatic or become of unsound mind. vi. If he is requested in writing by all the other Directors to resign his office;

104: A Director may hold any office in the company except that of an auditor upon such terms as to the remuneration and tenure of

office as the Board of Directors may determine. 106: The Company may by ordinary resolution remove any Director. Such removal shall be without prejudice to any claim such Director

may have for damages, for breach of contract of service between him and the Company. Rotation of Directors 107: At the Annual General Meeting in every year, one-third of the Directors for the time being or if their numbers is not a multiple of

five, then the number nearest to but exceeding one third shall retire from office. Proceedings of Directors. 113: The quorum necessary for the transaction of the business of the Directors may be fixed by the Directors and unless so fixed, shall be

half of the number of Directors, and where the number of Directors is not a multiple of two, then the quorum shall be half to the nearest number.

114: A resolution in writing, signed by all Directors entitled to notice of a meeting of Directors shall, be as valid and effectual as if it has been passed at a meeting of the Directors duly convened and valid held.

Notices 148: A notice or other document may be served by the company upon any member either personally or by sending it through the post in a

prepaid letter addressed to such member at his registered address or address on record in the books of the Company. 149: All notices directed to be given to the member shall with respect to any share to which persons are jointly entitled be to whichever of

such persons as in named first in the register of members, and notice so given shall be sufficient notice to all the holders of such share.

150: Every registered member and any holder of a share warrant who shall from time to time give the company an address at which the notice may be served upon him, shall be entitled to have notices served upon him at such address.

151: Any summons, notice, or other document required to be sent to or served upon the company, or upon any officer of the company, may be sent or served by leaving the same, or sending it through the post in a prepaid registered letter addressed to the company, or to such officer of the company.

152: Any notice or other document if served by post shall be deemed to have been served on the second day following that on which the letter containing the same is put into the post, and in proving such service it shall be sufficient to prove that the letter containing the notice or document was properly addressed and put into the post office as a prepaid letter or prepaid registered letter as the case may be.

153: When a given number of days notice or notice extending over any other period is required to be given the day of service shall be counted in the number of days or other period.

154: Any notice of other document served upon or sent to any member in accordance with these Articles shall, notwithstanding that he

was then deceased or bankrupt and whether the company is notified of his death or bankruptcy or not, be deemed duly served or sent in respect of any share held by him (either alone or jointly with others) until some other person is registered in this stead as the holder or joint holder of such shares, and such service be a sufficient service on his heir, executors, administrators or assigns and all other persons (if any) interested in such shares.

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9.7 Declaration

Except as otherwise disclosed in this Prospectus:

(a) No share of NAHCo Plc is under option or agreed conditionally or unconditionally to be put under option;

(b) No commissions, discounts, brokerages or other special terms have been granted by NAHCo Plc to any person in connection with the offer or sale of any share of the Company;

(c) Save as disclosed herein, the Directors of NAHCo Plc have not been informed of any holding representing 5% or more of the issued share capital of the Company;

(d) There are no founder, management or deferred shares or any option outstanding in NAHCo Plc;

(e) There are no material service agreements between NAHCo Plc and any of its Directors and employees other than in the ordinary course of business;

(f) There are no long-term service agreements between NAHCo and any of its Directors and employees except pension agreements;

(g) No Director of NAHCo Plc has had any interest, direct or indirect, in any property purchased or proposed to be purchased by the

Company in the five years prior to the date of this Memorandum;

(h) No director or key management staff of the Company is or has been involved in any of the following:

A petition under any bankruptcy or insolvency laws filed (and not struck out) against such person or a partnership in which he was a partner or any company of which he was a director or key personnel;

A conviction in a criminal proceeding in a named subject of pending criminal proceedings relating to fraud or dishonesty; and

The subject of any order, judgment or ruling of any court of competent jurisdiction or regulatory body relating to fraud or dishonesty, restraining him from acting as an investment

adviser, dealer in securities, director or employee of a financial institution and engaging in any type of business practice

or activity.

(h) No existing and potential related-party transactions and conflict of interest in relation to the company and its related-parties.

(i) There are no amounts or benefits paid or intended to be paid or given to any promoter within the two years preceding the date of the

Memorandum.

(j) No merger/take-over offers by third parties in respect of NAHCo Plc securities or merger/take-over offers by NAHCo Plc in respect

of other company’s securities during the preceding year and the current financial year.

9.8 Material Contracts:

The following agreements have been entered into and are considered material to the Offer for Subscription:

i. A Vending Agreement between FCMB Capital Markets Limited, Oceanic Bank International Plc, BGL Securities Limited, Sterling Capital Markets Limited and Unex Securities & Investment Limited on one hand, and NAHCo Plc on the other hand, dated 30th of August 2007 under which The Joint Issuing Houses have agreed to Offer for Subscription of 90,000,000 Ordinary Shares of 50 kobo each in NAHCo Plc at N17.50 per share and Offer by way of a Rights Issue of 35,000,000 Ordinary Shares of 50 kobo each at N16.50 per share.

ii. An Underwriting Agreement dated 30th of August 2007 under which FCMB Capital Markets Limited, Oceanic Bank International Plc, BGL Securities Limited, Sterling Capital Markets Limited and Unex Securities & Investment Limited have agreed to underwrite on a firm basis, 80% of the Combined Offers (90,000,000 Ordinary Shares of 50 kobo each by way of an Offer for Subscription and 35,000,000 Ordinary Shares of 50 kobo each by way of an rights to existing shareholders).

Other than as stated above, the Company has not entered into any material contract except in the ordinary course of business.

9.9 Claims and Litigation

There are 7 pending suits against NAHCo Plc with a total claim of N216,693,603.56 made up of N81,891,075.50 and $1,069,891.81 while NAHCo Plc, on the other hand is seeking to recover the sum of N85,567,458.90 from 2 suits instituted by it. However, the Solicitors to the Offer are of the opinion that the maximum contingent liability that may arise from the pending cases against the company is not likely to exceed the sum of N216,693,603.56. Save as disclosed, the solicitors to the offer are not aware of any other pending or threatened claims or litigation involving the company, which may be material to the offer.

54


The Directors are of the opinion that none of the aforementioned cases is likely to have any material adverse effect on the Company or the Offer. Details of the claims and litigation have been filed with the Securities & Exchange Commission and The Nigerian Stock Exchange and are also available for inspection at the offices of the Lead Issuing House.

9.10 Cost and Expenses

The cost and expenses incidental to the Offer including fees payable to the regulatory authorities, professional parties, advertising and printing expenses are estimated at N149,909,535.00 representing 6.96% of the proceeds of the Issue and are payable by NAHCo Plc.

9.11 Consents

The underlisted parties have given and have not withdrawn their written consents to the issue of this Prospectus with their names being included in the form and context in which they appear:

The Directors of NAHCo: Ambassador (Dr.) Patrick Dele Cole, CON Chairman Alhaji Suleiman Yahyah Vice-Chairman Mr. Bates Sarki Sule Managing Director/Chief Executive Officer Mr. Mobolaji Balogun Arc. Usman Arabi Musa Bello Mr. Sylvanus Pyam Yakubu Gang Mr. Denis Hasdenteufel Air France representative Mr. Thomas Mueller Lufthansa representative Mr. Osita Apollos Onyenwe Mr. Brett Silver British Airways representative

Company Secretary: Mrs. Folashade Ode

Joint Issuing Houses: First City Monument Bank Plc Oceanic Bank International Plc BGL Securities Limited Sterling Capital Markets Limited Unex Securities & Investment Limited

Auditors: Horwath Dafinone

Stockbrokers to the Offer: GTI Capital Limited Intercontinental Securities Limited Anchoria Investments and Securities Limited Compass Investments and Securities Limited Empire Securities Limited FutureView Financial Services Limited Premium Securities Limited Profund Securities Limited Tower Asset Management Limited TRW Stockbrokers Limited Spring Stockbrokers Limited

Reporting Accountants: BDO Oyediran Faleye Oke & Co.

Solicitors to the Offer: Ahmed Uwais & Co

Solicitors to the Company: Banwo & Ighodalo

Registrars to the Offer: City Securities (Registrars) Limited

Receiving Banks: First City Monument Bank Plc Oceanic Bank International Plc

Joint Underwriters: FCMB Capital Markets Limited Oceanic Bank International Plc BGL Securities Limited Chapel Hill Advisory Partners Limited Sterling Capital Markets Limited Unex Securities & Investment Limited

55


9.12 Documents Available for Inspection

Copies of the following documents may be inspected at the offices of FCMB Capital Markets Limited, Primrose Tower, 17A Tinubu Street, Lagos during the normal business hours on any weekday (except public holidays) from Monday, 10th September, 2007 until Friday 28th September, 2007.

1) The Prospectus issued in respect of the Offer; 2) Rights Circular issued in connection with the Rights Issue 3) Certificate of Incorporation of the Company; 4) Memorandum and Articles of Association of the Company, duly certified by the Corporate Affairs Commission; 5) The resolution of the Board of Directors recommending the Offer, which was passed at the meeting of 1st March 2007; 6) Shareholders resolution approving the Offer, which was passed at the Annual General Meeting held on 25th May 2007; 7) The audited financial statements of the Company for the five years ended 31st December 2006; 8) The Report of BDO Oyediran Faleye Oke & Co (Chartered Accountants), Reporting Accountants, on the financial statements of the

Company for the five years ended 31st December 2006; 9) The Memorandum on the Profit Forecast of the Company for the years ending 31st December, 2007, 2008, and 2009, prepared by BDO

Oyediran Faleye Oke & Co (Chartered Accountants), Reporting Accountants; 10) List of claims and litigation referred to above; 11) The written consents referred to in (9.11) above; 12) The material contracts referred to in (9.8) above; 13) The Prospectus issued in respect of the Offer; 14) Schedule of the particulars of the premises in which NAHCo has beneficial interest; 15) Letter from the Securities & Exchange Commission approving the Offer; and 16) Letter from The Nigerian Stock Exchange approving the Offer.

9.13 Relationship Between the Issuer and its Advisers

The Vice-Chairman of NAHCo, Alhaji Suleiman Yahyah is on the Board of Empire Securities Limited, Joint Stockbrokers to the Offer, as well as a director of FCMB Capital Markets Limited, the Lead Issuing House. Mr. Mobolaji Balogun, a Director of NAHCO, is also the Managing Partner of Chapel Hill Advisory Partners Limited, Joint Underwriters to the Combined Offers. Save as disclosed, there is no other known relationship between the company and its Advisers other than in the ordinary course of business

56

10. Procedure for Application and Allotment 10.1 APPLICATION 10.1.1 The general investing public is hereby invited to apply for the Ordinary shares through any of the Receiving Agents listed on Page 57

of this Prospectus. 10.1.2 Application for the Ordinary shares now being offered must be made in accordance with the instructions set out on the back of the

Application Form. Care must be taken to follow these instructions as applications which do not comply will be rejected. 10.1.3 The Application List for the Ordinary shares now being offered will open on Monday 10th September, 2007, and close on Friday 28th

September, 2007. Applications for the shares must be for a minimum of 1,000 shares and in multiples of 100 shares thereafter. The number of shares for which application is made and the amount of the cash, cheque or bank draft attached should be entered in the boxes provided.

10.1.4 The subscription currency for the Offer is the Nigerian Naira (N). 10.1.5 Applications must be made only on the Application Form. However, applications made on photocopies of the Application Form will be

accepted. 10.1.6 An applicant should make only one application, whether in his/her own name or in the name of a nominee. Multiple or suspected

multiple applications will be rejected. 10.1.7 Individual applicants should sign the declaration and write his/her full names, addresses and daytime telephone number(s) in the

appropriate sections. A corporate applicant should affix its seal and state its incorporation (RC) number in the spaces provided for this purpose.

10.1.8 Each Application should be forwarded ONLY to any of the Receiving Agents listed on Page 57 of this Prospectus, together with the

cash, cheque or bank draft for the full amount of the purchase price, crossed “NAHCo OFFER” and made payable to the Receiving Agents to which the application is addressed. All bank drafts will be presented upon receipt and all applications in respect of which cheques or bank drafts are returned unpaid will be rejected.

10.2 ALLOTMENT

The Issuing Houses and the Directors of the Company reserve the right to accept or reject any application in whole or in part, for not complying with the conditions of the Offer. The allotment proposal will be subject to the clearance of the Securities & Exchange Commission.

10.3 APPLICATION MONIES

All application monies will be retained in a separate interest yielding bank account with the Receiving Bank pending allotment. If any application is not accepted, or is accepted for fewer shares than the number applied for, a crossed cheque for the full amount or the balance of the amount paid (as the case may be) will be returned by registered post within 5 (five) working days of allotment. Share Certificates in respect of shares allotted will be sent by registered post not later than 15 (fifteen) working days from the date of allotment clearance.

Any investor who does not want to receive a physical share certificate, should state the name of his/her stockbroker and his/her CSCS account number in the space provided on the Application Form.

57

RECEIVING AGENTS

Application Forms may be obtained free of charge from, and submitted upon completion to, any of the under listed Receiving Agents duly registered as capital market operators by the SEC, to whom brokerage will be paid at the rate of 0.75% per N100 worth of Units allotted in respect of Application Forms bearing their official stamp.

The Issuing Houses cannot accept responsibility for the conduct of any of the Receiving Agents listed below. Investors are therefore advised to conduct their own enquiries before choosing an agent to act on their behalf. Evidence of lodgment of funds with any of the Receiving Agents listed below, in the absence of corresponding evidence of receipt by the Issuing Houses, cannot give rise to a liability on the part of the Issuing Houses under any circumstances.

BANKS Access Bank of Nigeria Plc Guaranty Trust Bank Plc Stanbic Bank Nigeria Limited Afribank Nigeria Plc IBTC Chartered Bank Plc. Standard Chartered Bank Nigeria Limited Equitorial Trust Bank Plc Intercontinental Bank Plc Sterling Bank Plc Diamond Bank Limited Nigerian International Bank Limited Union Bank of Nigeria Plc Ecobank Plc Oceanic International Bank Plc United Bank for Africa Plc Fidelity Bank Plc Platinum Habib Bank Plc Unity Bank Plc First Inland Bank Plc Skye Bank Plc Wema Bank Plc First City Monument Bank Plc Spring Bank Plc Zenith Bank Plc First Bank of Nigeria Plc

STOCKBROKERS AND OTHERS AAA Stockbrokers Limited Financial Derivatives Co. Ltd. Pivot Trust & Investment Limited Adamawa Securities Limited. Finmal Finance Services Ltd Profund Securities Limited Adonai Stockbrokers Ltd. First Equity Sec. Limited Prominent Securities Limited Afrinvest West-Africa Ltd. First Stockbrokers Limited PSL Securities Limited AIL Securities Limited. FIS Securities Limited PSI Securities Ltd Alangrange Sec. Ltd. Foresight Sec. Inv. Limited Pyramid Securities Ltd Alliance Capital Management Company Limited. Forte Asset Management Limited Quantum Securities Limited AMYN Investment Ltd. Forthright Sec. & Inv. Limited Rainbow Sec. & Inv. Co. Ltd. Anchoria Inv. & Sec. Ltd. Fountain Securities Limited Reading Investments Ltd Apel Asset & Trust Ltd. Future View Financial Services Ltd Regency Assets Mgt. Ltd. APT Sec. & Funds Limited. Gidauniya Inv. & Sec. Ltd. Resano Securities Limited Aquila Capital Limited Global Assets Mgt (Nig) Ltd Resort Securities & Trust Ltd. Asset Resource & Mgt. Ltd. Golden Securities Ltd. Reward Inv. & Sec. Ltd. Associated Asset Managers Ltd. GTI Capital Limited Rivtrust Securities Limited Atlas Portfolio Ltd. Heartbeat Investments Ltd. Rolex Securities Limited Belfry Invest. & Sec. Limited Hedge Sec. & Inv. Co. Ltd Rostrum Inv. & Investments & Securities Ltd Best Link Investment Ltd. Horizon Stockbrokers Ltd. Royal Crest Finance Limited Bestworth Assets & Trust Ltd. IBTC Asset Mgt. Limited Santrust Securities Limited BFCL Assets & Sec. Ltd. ICMG Securities Limited Securities Trading & Investment Ltd BGL Securities Limited Icon Stockbrokers Limited. Securities Solutions Limited BIC Securities Ltd. Independent Securities Ltd. Security Swaps Limited BSD Securities Limited Intercontinental Capital Markets Ltd. Shelong Investment Limited Bytofel Trust & Securities Ltd Intercontinental Sec. Limited Sigma Securities Limited C & I Heritage Limited International Standard Sec. Ltd. Signet Investments Sec. Ltd. Calyx Securities Limited Interstate Securities Ltd SMADAC Securities Ltd. Camry Securities Ltd. Investment Centre Ltd (ICL) Solid Rock Sec. & Inv. Limited Capital Asset Limited Investment Masters & Trust Ltd Solid Rock Securities & Investment Ltd Capital Bancorp Limited. Jamkol Investment Ltd. Spring Capital Markets Ltd Capital Express Sec. Limited Kapital Care Trust & Sec. Ltd Spring Trust & Securities Limited Capital Trust Brokers Ltd. Kundila Finance Services Ltd. Springboard Trust & Inv. Ltd. Cashcraft Asset Management Ltd. Lambeth Trust & Inv. Co. Ltd Stanbic Equities Nig. Limited Centre Point Investment Ltd. LB Securities Limited Stanwal Securities Limited Century Securities Limited Lead Capital Limited100 Sterling Capital Market Ltd Chapel Hill Advisory Partners Lighthouse Asset Management Limited Strategy & Arbitrage Limited Citi Investment Capital Ltd Maclaize Trust & Securities Limited Summa Guaranty & Trust Co. City Investment Mgnt. Ltd Mainland Trust Limited Summit Finance Co. Ltd. Clearview Inv. Co. Limited Maninvest Asset Mgt. Ltd Supra Commercial Trust Ltd. Compass Investment & Securities Ltd Marimpex Finance & Investment Limited TFS Securities & Inv. Co. Ltd Core Trust & Inv. Limited Marina Securities Limited The Bridge Securities Ltd Cowry Asset Management Ltd Marriot Sec. & Inv. Co. Tiddo Securities Limited Cradle Trust Finnance & Sec. Ltd Maven Asset Management Ltd Tomil Trust Limited Crossworld Securities Ltd. Maxifund Invest & Sec. Ltd. Topmost Finance & Investment Limited Crownwealth Assets Mgt. Ltd MBC Securities Limited Tower Assets Mgt. Limited CSL Stockbrokers Limited MBL Financial Services Ltd Tower Securities & Investment Co. Ltd De-Canon Investment Ltd. Mega Equities Limited Traders Trust & Investment Co. Ltd Deep Trust Investment Ltd Mercov Securities Limited Trans Africa Financial Services Limited De-Lords Securities Limited Meristem Securities Ltd Transworld Investment & Securities Ltd Denham Management Ltd. Metropolitant Trust Nigeria Ltd Tropics Securities Limited Dependable Securities Ltd. Midland Capital Markets Limited Trust Yeild Securities Limited EBN Securities Limited Mission Securities Limited Trusthouse Investment Ltd. Emerging Capital Limited Molten Trust Limited TRW Stockbrokers Limited EMI Capital Resources Limited Mountain Inv. & Sec. Limited UBA Global Markets Ltd Empire Securities Limited Mutual Alliance Inv. & Sec. Ltd. UBA Stockbrokers Ltd Enterprise Stockbroker Plc. Networth Securities & Finance Ltd. UIDC Securities Limited EPIC Investment & Trust Limited Newdevco Invest. & Sec. Ltd Unex Sec. & Inv. Limited Equity Capital Solutions Ltd Nigerian International Sec. Ltd. Union Capital Markets Ltd ESL Securities Limited Nigerian Stockbrokers Ltd. Valmon Securities Limited Eurocomm Securities Ltd. Nova Finance & Securities Ltd. Valueline Sec. & Inv. Limited Excel Securities Limited OASIS Capital Fomerly OMF Sec. & Fin. Limited Vetiva Capital Management Limited Express Discount Asset Management Ltd Omas Inv. & Trust Limited Vision Trust & Inv. Limited Express Portfolio Services Ltd. Options Securities Limited Viva Securities Limited F & C Securities Limited P.S.I. Securities Limited Wizetrade Capital Asset & Mgt. Ltd Falcon Securities Limited Peninsula Assets Management & Investment Co. Ltd WSTC Financial Services Limited FBC Trust & Securities Ltd Pilot Securities Ltd. Yobe Investment & Sec. Limited FBN Capital Limited Pinefields Inv. Serv. Limited Yuderb Investment & Securities Limited FCMB Capital Markets Limited PML Securities Company Ltd Zenith Securities Limited Fidelity Finance Co. Plc Premium Securities Limited Zuma Securities Limited Fidelity Union Sec. Ltd. Professional Stockbrokers Ltd

58

PLEASE COMPLETE IN BLOCK LETTERS AND IN BLACK INK

Signature or Thumbprint Signature or Thumbprint

City Securities (Registrars) Limited Stamp of Receiving Agent

Application List Opens

Monday 10th September, 2007

Application List Closes

Friday 28th September, 2007

o I am/We are 18 years of age or over. o I/We attach the amount payable in full on application for the above number of Shares indicated in NAHCO Plc at N=17.50 per share. o I/We agree to accept the same or any smaller number of Shares in respect of which

allotment may be made upon the terms of the Prospectus dated 30th August, 2007, and subject to the provisions of the Memorandum and Articles of NAHCO Plc.

o I/We authorise you to send a Share Certificate and/or a cheque for any amount overpaid, by registered post to the address given below and to procure registration in my/our name as the holder(s) of such number of Shares or such smaller number, as aforesaid

o I/We hereby declare that I/We have read a copy of the Prospectus dated 30th August, 2007 issued by the Joint Issuing Houses on behalf of NAHCO Plc.

Surname / Company Name

Other Names (for Individual Applicants only

Full Postal Address

Daytime Telephone Number

City State

E – Mail Address

Mobile (GSM) Telephone Number

GUIDE TO APPLICATION Number of Shares applied for Amount Payable 1000 Minimum N17,500.00 Subsequent multiples of 100 N1,750.00

RC 30954

Nigerian Aviation Handling Company Plc Offer for Subscription of

90,000,000 Ordinary Shares of 50 kobo each at N17.50per share Payable in full on Application

Joint Issuing Houses:

DECLARATION

Date Control No. (REGISTRARS’ USE ONLY)

/ 0 9 / 2 0 0 7 Number of Units Applied for: Value of Shares applied for/Amount Paid:

N

1. INDIVIDUAL / CORPORATE APPLICANT Title: □ MR. □ MRS. □ MISS □ DR. OTHERS

Next of Kin

CSCS No. (If you want shares allotted to you, credited to your CSCS A/C) Name of your Stockbroker

2. JOINT APPLICANT Title: □ MR. □ MRS. □ MISS □ DR. OTHERS Surname -----------------------------------------------

Other Names

Name of Bank / Branch ………………………………………………………….Account Number………….………………. Company Seal/Incorporation Number (Corporate Applicants)

____________________

________________

Important Notice: Application must be made in accordance with the instructions set out on the back of this Application Form. If you are in doubt as to the action to take, please consult your financial adviser, stockbroker, solicitor, accountant, tax consultant, bank manager or any other professional adviser for guidance. Care must be taken to follow these instructions as applications that do not comply with the instructions will be rejected.

PLEASE TURN OVER


RC 446561

RC 269666

RC 147269

59

Instructions For Completing The Application Form 1. Applications should be made only on the Application Form or photocopy, downloaded or scanned copy of the

Application Form. 2. Applications must not be for less than the minimum number of shares stated on the Application Form.

Applications for more than the minimum number of shares must be in the multiples stated on the Application Form. The number of Ordinary Shares for which an application is made and the amount of the cheque or bank draft attached should be entered in the boxes provided.

3. The application Form when completed should be lodged with any of the Receiving Agents listed on Page 57.

Applications must be accompanied by a cheque or bank draft made payable to the Receiving Agent to whom the application is submitted, for the full amount payable on application. The cheque or draft must be drawn on a bank in the same town or city in which the Receiving Agent is located and crossed “NAHCo OFFER” with the name, address and daytime telephone number of the applicant written on the back. All bank commissions and transfer charges must be prepaid by the applicant. All cheques and drafts will be presented upon receipt and all applications in respect of which cheques are returned unpaid will be rejected and returned through the post.

4. The applicant should make only one application, whether in his own name or in the name of a nominee.

Multiple or suspected multiple applications will be rejected. 5. Joint applicants must all sign the Application Form. 6. An application from a group of individuals should be made in the names of those individuals with no mention

of the name of the group. An application by a firm which is not registered under the Companies and Allied Matters Act Cap C20 LFN 2004 should be made either in the name of the proprietor or in the names of the individual partners. In neither case should the name of the firm be mentioned.

7. An application from a corporate body must bear the corporate body’s seal and be completed under the hand of a

duly authorized official. 8. An application by an illiterate should bear his right thumbprint on the Application Form and be witnessed by an

official of the Bank or stockbroker where the application is lodged who must first have explained the meaning and effect of the Application Form to the illiterate in his own language. Above the thumb print of the illiterate, the witness must record in writing that he has given this explanation to the illiterate in a language understandable to him and that the illiterate appeared to have understood same before affixing his thumb impression.

9. The applicant should not print his signature. If he is unable to sign in the normal manner, he should be treated

for the purpose of this Offer as an illiterate and his right thumbprint should be clearly impressed on the Application Form.

APPLICATION FORM

NIGERIAN AVIATION HANDLING COMPANY PLC