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DJ Lombard Capital PLC Notice of AGM; Share Capital Reorganisation

 
TIDMLCAP 
 
LOMBARD CAPITAL PLC 
                         ("Lombard" or the "Company") 
 
                   AGM Notice; Share Capital Reorganisation 
 
Lombard Capital Plc announces that notice has been sent to Shareholders 
convening the Company's Annual General Meeting, to be held at the offices of 
Welbeck Associates, 30 Percy Street, London, W1T 2DB on 17 December 2014 at 
10.00am. Set out below is the text of the accompanying letter from the 
Company's Chairman, together with the Notice of the AGM. 
 
A summary of the resolutions to be proposed at the meeting is set out below: 
 
Ordinary business: 
 
Resolution 1, seeks approval for the annual accounts for the year ended 31 
March 2014; 
 
Resolution 2, seeks approval for the reappointment of Welbeck Associates as 
auditors; 
 
Resolution 3, seeks approval for the re-election of Jason Teichman as a 
director; 
 
Resolution 4, seeks approval for the re-election of Russell Darvill as a 
director; 
 
Special business: 
 
Resolution 5, seeks approval for the Share Capital Reorganisation; 
 
Resolution 6, seeks approval for the proposed New Investment Strategy; 
 
Resolution 7, seeks approval for the authority to allot securities; and 
 
Resolution 8, which is subject to the passing of resolution 7, seeks approval 
for the disapplication of pre-emption rights in connection with the allotment 
of securities for cash. 
 
The Directors of Lombard are responsible for the contents of this announcement. 
 
=-ENDS-- 
 
ENQUIRIES: 
 
LOMBARD CAPITAL PLC 
Jason Teichman 
+44 776 888 2644 
 
PETERHOUSE CORPORATE FINANCE LIMITED 
Mark Anwyl and Fungai Ndoro 
+44 20 7469 0934 
 
Below is an extract of the notice sent to Shareholders earlier today. 
Capitalised terms used but not defined in this announcement have the same 
meaning as given to them in the AGM Notice. 
 
"Dear Shareholders, 
 
Introduction 
 
I am writing to invite you to the Annual General Meeting of the Company to be 
held at 10.00 am on 17 December 2014, at 30 Percy Street, London W1T 2DB. The 
notice of the Annual General Meeting is set out at the end of this Document and 
a copy of the annual report and accounts for the company for the year ended 31 
March 2014 is also enclosed. 
 
In addition to the ordinary business to be conducted at the AGM, the Company 
has announced today a series of proposals, namely, the Share Capital 
Reorganisation, the adoption of the New Investment Strategy and certain other 
related matters to be proposed as special business at the Annual General 
Meeting. The purpose of this letter is to provide you with the background to, 
and to explain why the Directors consider these proposals to be in the best 
interests of the Company and Shareholders as a whole and why they recommend 
that Shareholders should vote in favour of the Resolutions to be proposed at 
the AGM. 
 
Background 
 
The Directors have been evaluating the performance of Lombard as an investment 
vehicle on ISDX. The Directors have explored and attempted a number of 
strategies designed to increase the Company's net assets and more importantly 
to enhance Shareholders' value. The Board has also been exploring ways of 
extracting value in a way that is transferable to the Shareholders. However 
previous strategies have not delivered the returns for Shareholders and 
therefore, the Directors are proposing the adoption of the New Investment 
Strategy, further details of which can be found on page 7-8. The Directors 
believe that the New Investment Strategy will give them an opportunity to 
deliver value for Shareholders in the long term. 
 
The Directors believe that the Company will need further funds in order to 
successfully implement the New Investment Strategy. The Share Capital 
Reorganisation, as described below will enable the Company to raise further 
funds through the issuance of equity, as it cannot do so currently, 
 
Share Capital Reorganisation 
 
As at the close of business on 20 November 2014, the mid-price of the Company's 
Existing Ordinary Shares as quoted on the ISDX Growth Market was 0.04pence per 
share, which represents a 60 per cent discount to the 0.1pence nominal value of 
the Existing Ordinary Shares. 
 
Under the Act, the Company is prohibited from issuing ordinary shares at a 
discount to their nominal value. The Company is therefore currently unable to 
issue shares to raise cash or as consideration for acquisitions. This is a 
severe constraint on the Company's ability to raise further funds to implement 
its stated investment strategy. The Directors are therefore proposing the Share 
Capital Reorganisation, which will result in a more appropriate capital 
structure for the Company enabling Lombard to properly execute its investment 
strategy and develop its business. 
 
The Board therefore proposes in Resolution 5, to reorganise the share capital 
of the Company. 
 
The Share Capital Reorganisation will consist of two elements; 
 
a) The Share Consolidation 
 
The Board proposes that all of the Existing Ordinary Shares of the Company be 
consolidated on the basis of one Consolidated Share of 10 pence for every one 
hundred Existing Ordinary Shares of 0.1 pence, currently held. 
 
For the avoidance of doubt, Shareholders holding less than 100 Existing 
Ordinary shares will receive no Consolidated Shares. The Share Consolidation 
will give rise to fractional shares, where a Shareholder's total holding is not 
exactly divisible by 100. Fractions of New Ordinary Shares will not be 
allotted, instead they will be aggregated and sold for the benefit of the 
Company. It is estimated that the total value of all fractions will amount to 
less than GBP10.00. 
 
The table below gives some examples of the effect of the Capital Reorganisation 
on specific shareholdings of Existing Ordinary Shares: 
 
Number of Existing Ordinary Shares         New Ordinary Shares issued 
 
                  99                                  NIL 
 
                  100                                  1 
 
                  250                                  2 
 
                  490                                  4 
 
                  999                                  9 
 
                 1,000                                 10 
 
b) The Share Split 
 
Immediately following the Share Consolidation, the share capital of the Company 
will consist of 1,918,150 Consolidated Shares. The Board proposes that each 
Consolidated Share be then subdivided into one New Ordinary Share of 0.1 pence 
and one Deferred Share of 9.9 pence, in nominal value. 
 
The rights attaching to the New Ordinary Shares will be identical in all 
respects to those of the Existing Ordinary Shares. The Deferred Shares will 
have no voting rights, no entitlement to attend general meetings of the Company 
and will carry only the right to participate in any return of capital to the 
extent of the amount paid up or credited as paid up on each Deferred Share 
after the holders of Ordinary Shares have received capital repayments amounting 
to GBP1,000,000 in respect of each New Ordinary Share. Accordingly, the Deferred 
Shares will, for all practical purposes, be valueless and it is the Board's 
intention, at an appropriate time, to cancel the Deferred Shares. 
 
Following approval of Resolution 5 at the AGM the Company will have 1,918,150 
New Ordinary Shares with a nominal value of 0.1 pence each, in issue. 
 
CREST and Share Certificates 
 
It is expected that New Ordinary Shares will be credited to Shareholders' CREST 
accounts on 18 December 2014. 
 
CREST is a voluntary system and shareholders who wish to receive and retain 
share certificates will be able to do so. However, certificates representing 
Existing Ordinary Shares will no longer be valid if the Share Capital 
Reorganisation is approved at the General Meeting. Certificates in respect of 
New Ordinary Shares are expected to be posted to Shareholders by 24 December 
2014. 
 
New Investment Strategy (Resolution 6) 
 
As articulated in the Company's report and accounts for the year ended 31 March 
2014, Lombard's recent focus on the provision of short-term lending facilities 
has become increasingly challenging as the Company has struggled to find 
companies to meet its lending criteria. This has been compounded by the erosion 
of funds available to the Board to execute this strategy. With this in mind, 
the Board feels that the Company would benefit from a change in investment 
strategy. The proposed change would give the Company greater flexibility to 
focus on investment opportunities, which, the Board considers, will have the 
potential for greater returns and, as detailed below, enable it to attract more 
funds to make further investments with a view to increasing the value of the 
Company's shares going forward. 
 
The Directors therefore propose to adopt the following investment strategy: 
 
The New Investment Strategy will be to acquire interests in companies through 
the subscription to new issues of equity. Investee companies will typically be 
quoted on a recognised stock exchange or trading platform to provide liquidity 
or, where private, in the opinion of the Directors have the ability to achieve 
a quotation or liquidity event within 12 months from the date of investment. 
The Company will consider acquiring existing shares in companies where the 
Directors consider the purchase price to be of a value better or equivalent to 
that of a new issue of shares in that company. 
 
The Directors will focus on companies in the small cap equity market where they 
consider, if warranted, they will have the ability to assist management of 
these companies achieve their commercial goals be it directly or by referral to 
appropriate contacts within their network. 
 
In addition to direct equity in companies, the Company may take positions by 
way of convertible loan notes or bridging loans where appropriate. In each 
circumstance any loans would be short dated or subject to short-term conversion 
events. The Directors may also seek to introduce investee companies to other 
sources of finance to ensure any investment by the Company would be alongside 

(MORE TO FOLLOW) Dow Jones Newswires

November 24, 2014 02:00 ET (07:00 GMT)

DJ Lombard Capital PLC Notice of AGM; Share Capital -2-

sufficient other parties to enable it to be suitably capitalised for its 
mid-term targets. 
 
The New Investment Strategy will consider all sectors but focus on TMT 
(technology, media and telecommunications), leisure, retail, healthcare, clean 
energy and financial services in Europe. 
 
The Company does not intend to put any limitation on the number of companies 
into which it may invest but shall not, unless by exception, invest more than 
50% of its investable asset base (by reference to cash and investments) into 
any one project. Whilst it is not the Directors' current intention, should a 
suitable investment opportunity be presented which would be deemed a reverse 
takeover it would be put to shareholders for approval, if the Directors 
considered such an investment/acquisition to be in their best interests. 
 
The Board will review the New Investment Strategy on a regular basis (at least 
annually) and will implement any non-material changes or variations as they 
consider fit. Any material change or variation of the strategy will be subject 
to the prior approval from Shareholders. 
 
Resolution 6 in the AGM notice proposes the adoption of the New Investment 
Strategy. 
 
Authority to allot shares and disapplication of pre-emption rights (Resolutions 
7 and 8) 
 
In order to enable the Company to raise further funds to implement its New 
Investment Strategy, it is necessary for the Directors to seek authority from 
Shareholders at the AGM pursuant to the Act, inter alia, issue further shares 
for cash. The Directors will look to raise additional funds for the Company 
following the General Meeting, subject to any necessary resolutions being 
approved by Shareholders. 
 
Full details of the authorities the Directors are seeking at the AGM are set 
out in the attached notice of AGM. 
 
Board Changes 
 
Immediately following the AGM, Charlotte Argyle will be appointed to the Board 
of the Company as Executive Director and Jason Teichman will resign from the 
Board. Russell Darvill will remain as a Non-Executive Director of the Company. 
 
Charlotte Argyle has over 12 years' experience working with senior executives 
across the UK. With a focus on AIM and the pre-IPO market, Charlotte works with 
business leaders and senior stakeholders consulting on dealing with the 
challenges around fundraising, liquidity, organic and acquisitive growth, as 
well as handling disruptive market and regulatory trends. 
 
Charlotte is also an advisory non-executive director to the national cost 
recovery business - `Healthcare Cost Recovery' -a leading provider of third 
party funds recovery to the NHS & healthcare sector in n the UK 
 
Charlotte acts as a co-host for ADVFN's AIM focused annual UK Investor Forum 
2015 and is also a director on her own venture Vault Capital. 
 
In addition to her directorship of the Company, Charlotte Argyle holds or has 
held the following directorships in the five years prior to the date of this 
announcement: 
 
Vault Capital Ltd Bidhealth Limited 
 
Healthcare Cost Recovery 
 
Annual General Meeting 
 
The Notice convening the AGM is set out on page 11-13 of this Document at which 
the Resolutions will be proposed. A summary of the Resolutions is set out 
below: 
 
Ordinary business: 
 
Resolution 1, which will be proposed as an ordinary resolution, seeks approval 
for the annual accounts for the year ended 31 March 2014; 
 
Resolution 2, which will be proposed as an ordinary resolution, seeks approval 
for the reappointment of Welbeck Associates as auditors; 
 
Resolution 3, which will be proposed as an ordinary resolution, seeks approval 
for the re-election of Jason Teichman as a director; 
 
Resolution 4, which will be proposed as an ordinary resolution, seeks approval 
for the re-election of Russell Darvill as a director; 
 
Special business: 
 
Resolution 5, which will be proposed as a special resolution, seeks approval 
for the Share Capital Reorganisation; 
 
Resolution 6, which will be proposed as an ordinary resolution, seeks approval 
for the proposed New Investment Strategy; 
 
Resolution 7, which will be proposed as an ordinary resolution, seeks approval 
for the authority to allot securities; and 
 
Resolution 8, which will be proposed as a special resolution and is subject to 
the passing of resolution 7, seeks approval for the disapplication of 
preemption rights in connection with the allotment of securities. 
 
Action to be taken 
 
Shareholders will find a Form of Proxy enclosed for use at the AGM. Whether or 
not you intend to be present at the AGM, you are requested to complete and 
return the Form of Proxy in accordance with the instructions printed thereon as 
soon as possible. To be valid, completed Forms of Proxy must be received by the 
Company's Registrars, Share Registrars Ltd, Suite E First Floor, 9 Lion & Lamb 
Yard, Farnham, Surrey, GU9 7LL not later than 10 a.m. on 15 December2014, being 
48 hours before the time appointed for holding the AGM. Completion of the Form 
of Proxy will not preclude you from attending and voting at the AGM in person 
if you so wish. 
 
Recommendation 
 
The Directors, consider the Resolutions proposed to be fair and reasonable and 
in the best interests of the Company and the Shareholders as a whole and 
therefore recommend that you vote in favour of the Resolutions. 
 
Yours sincerely, 
 
Jason Teichman 
Chairman" 
 
 
 
END 
 

(END) Dow Jones Newswires

November 24, 2014 02:00 ET (07:00 GMT)