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Inside Articles that ‘brewed’ coffee processing company
Finance minister Matia Kasaija (centre) exchanges documents with Ms Enrica Pinetti (left) after UVCC signed an agreement with the Finance ministry to establish a coffee processing plant in Uganda, on February 10. PHOTO/FILE
What you need to know:
- It is agreed by owners that they will never sell any of the shares, yet also the number of promoters apart from those who may be employed will not exceed 50.
Details of the private company that signed on the dotted line of a coffee processing deal with the Government of Uganda (GoU) have emerged, indicating that its owners either hail or are based in the tax haven that is the United Arab Emirates (UAE).
Documents from the Uganda Registration Services Bureau (URSB) indicate that Uganda Vinci Coffee Company Limited (UVCC) was incorporated on January 9, 2014 as a company limited by shares.
Saturday Monitor can exclusively reveal that UVCC comprises one firm and four individual shareholders—all of whom have their registered addresses in the UAE.
Ms Enrica Pinetti, the Italian woman who witnessed the coffee processing deal between the GoU and UVCC, is registered in the Memorandum and Articles of Association as the board chairman.
Curiously, the registrar of companies gave UVCC the green light despite all its other board positions remaining unfilled.
At the time of registration, the share capital of the company was $10m (about Shs353b) and divided into 1,000 ordinary shares of $10,000 (about Shs35m). The shareholders include one company known as Hawk Limited which has 960 shares. It is registered on P.O.Box 58562, Dubai, UAE.
Elsewhere, individuals—including Ahmed Ahmed Sultan Ismail and Hisham Ahmed Sultan Ismail both of whom have equal shares of 10 and are registered on address P.O.Box 118508, Dubai, UAE.
Their colleagues Ibrahim Elias Salloum and Hadi Elias Salloum of P.O.Box. 46527 Abu Dhabi, UAE also have an equal share holding of 10. If little—or, more accurately, nothing is known about the four individuals, it is because as one source told Saturday Monitor “they are ghosts.” Documentations with the URSB appear to support this position.
A Ugandan lawyer—Moses Matovu—is the company secretary. He witnessed UVCC’s Articles that was filed at the URSB. Efforts to speak to Mr Matovu were futile.
Rules of engagement
It is agreed by owners that they will never sell any of the shares, yet also the number of promoters apart from those who may be employed will not exceed 50. The directors are empowered with discretion to appoint alternate directors to act in their place.
Like elsewhere in company management, the business of the company will be run by the board and may at any time under company seal appoint any company or person to be the attorney of the company.
The Articles also state that the board will appoint an executive director who will act to run the company as guided by the board.
The company was incorporated to fulfil various objectives but majorly to purchase, sell, import, export supply and trade in all types of coffee and relevant by-products, all types of agricultural products.
UVCC also aims at providing and arranging technical training, education, aiding as well as advising on various types of agricultural farming to growers.
It will also establish and integrate roasted, grounded and instant coffee processing plant from green coffee beans.
Renowned lawyer James Nangwala said the company is a local company governed by Uganda legislation although the subscribers appear to have United Arab Emirates addresses.
“(But) one may be interested in finding out its performance in coffee dealings with UCDA (Uganda Coffee Development Authority),” Mr Nangwala said.
The UCDA has, however, previously chosen to distance itself from the politics around UVCC’s incorporation and deal with the GoU. The UCDA says that it primarily interests itself in matters to do with the quality of coffee.
Questions around the ownership of UVCC cropped up after it came to light that Ms Pinetti signed the processing deal with the GoU as a witness.
On the curious question of why Ms Pinetti is the only registered director of UVCC, Mr Nangwala opines that “a company [may be] registered then the subscribers will at a supposed first meeting appoint directors who may be themselves.”
UVCC’s plant will be located on a 27-acre land in Kampala Industrial Park in Namanve, some 16 kilometres from Kampala.
This is along the existing Kampala-Jinja Highway. The site is located between Kyagulanyi coffee factory to its western side, Steel and tube industries to its southern side with new developments to its east and Bweyogerere Industrial Area Road to its north.
The Memorandum and Articles of Association were drawn by Kampala Associated Advocates in 2013. The document was filed on January 9, 2014. Ahmed Ahmed Sultan Ismail is listed in the document as a manager; Hisham Ahmed Sultan Ismail a business development manager; Ibrahim Elias Salloum a general manager; and Had Elias Salloum a chief accountant.
Forfeiture
On the issue of forfeiture of shares, the Articles proffer, among others, that: “If a member fails to pay any call or instalment of a call on the day appointed for payment thereof, the board may at any time thereafter during such times as any part of such call or instalment remains unpaid serve a notice on him requiring payment of so much of the call or instalment as is unpaid, together with any interest and expenses which may have accrued.”
The memorandum also states that “the board also may accept the surrender of any share liable to be forfeited.” In any case of forfeiture, “a forfeited share shall be deemed to be the property of the company and may be sold, re-allotted or otherwise disposed of either to the person who was [[previously] the holder thereof or entitled thereto or to any other person…”
Increase of capital
The Articles also offer clarity around increase of capital, stating thus: “The company may…direct that the new share or any of them shall be offered either at par or at a premium of…at a discount or may make any other provisions as to the issue of new shares.”
It adds: “The new shares shall be subject to all the provisions of these Articles with reference to payment of calls, lien, transfer, transmission, forfeiture and otherwise and, unless provided in accordance with these Articles, shall be issued as ordinary shares.”
All unused shares are at the disposal of the Board but who may determine a new allottee.
As regards the board of directors of the company, the Articles state that they “shall consist of not less than five and not more than 10 directors.” It goes on to add that “the first directors of the company are: chairman (listed simply as Enrica), vice chairman, Secretary, [and two] member[s].”
The Articles proceed to reveal that “the board shall fix the remuneration of the chairman of the board of directors. The chairman of the Board shall also be the chairman of the general meeting of the company.” Each director has “the power to appoint an alternate director to act in his place during his absence.”
Borrowing powers
About borrowing powers, the Articles proffer: “The board 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 and other securities whether outright or as collateral security for any debt, liability or obligation of the company or of any third party.”
It hastens to add a caveat in a bold typeface that declares: “[The money in question] shall not at any time without the previous sanction of any ordinary resolution of the company exceed a multiple of five the aggregate of the nominal amount of the issued and paid up share capital, the amount of any share premium account and the amount of the reserve account for the time being of the company…”
Dividends
On the issue of dividends, the Articles state: “The company in general meeting may form time to time declare dividends to be paid to the members according to their rights and interests in the profits, but no dividend shall be paid in excess of the amount recommended by the Board…All dividends shall be apportioned and paid pro rata according to the amounts paid up on the shares during any portion or portions of the period in respect of which the dividend is paid…No dividend shall bear interest against the company.”
Capitalisation of profits
On capitalisation of profits, it proffers: “The company in general meeting may upon the recommendation of the board…pass a resolution to the effect that it is desirable to capitalise any part of the amounts for the time being standing to the credit of any of the company’s reserves or to the credit or profit and loss account of otherwise available for distribution and not required for the payment of the fixed dividends on any preference share of the company…”
Account, audit processes
As regards to accounting practices, the Articles provide three broad categorisations, including, keeping account of “the sums of money received and expended by the company and the matters in respect of which such receipt and expenditure take place”; and “all sales and purchases of goods by the company”; plus “the assets and liabilities of the company.”
The Articles also guarantee an auditing process that will be “regulated in accordance with sections 167, 169 and 170 of the Act.”
Winding-up
UVCC can wind up following “the sanction of an extraordinary resolution of members.” At which point the company’s assets “shall be divided among the members of the company in specie or may be vested in trusts for the benefit of such members, and in liquidation of the company may be closed and the company dissolved.”
Shares
On the issue of forfeiture of shares, the Articles proffer, among others, that: “If a member fails to pay any call or instalment of a call on the day appointed for payment thereof, the board may at any time thereafter during such times as any part of such call or instalment remains unpaid serve a notice on him requiring payment of so much of the call or instalment as is unpaid, together with any interest and expenses which may have accrued.”
