Re Loan Agreement
2003年12月1日 - 11:38PM
RNSを含む英国規制内ニュース (英語)
RNS Number:6937S
Farsight PLC
01 December 2003
Loan Agreement
Introduction
In the Chairman's statement included in the report and accounts for the year
ended 31 May 2003 ("Report and Accounts") released on 28 November 2003, Farsight
plc ("Farsight" or "Company") announced that it had negotiated a conditional
secured convertible loan facility of up to #750,000 (the "Loan"). The Loan is
required to provide additional working capital. In view of its nature, the Loan
is conditional upon shareholders' approval, and a circular containing details of
the Loan and convening an extraordinary general meeting to approve the Loan is
being sent to shareholders today.
Background to and reasons for the Loan
As reported in the Report and Accounts, significant progress has been and
continues to be made in the Group's monitoring and e-surveillance business.
However, the liquidation of the AIMS business in March 2003 and the existence of
certain legacy debts has meant that the Company has not yet been able to achieve
consistently a cash neutral position on a monthly basis. As a result the Company
has exhausted its cash reserves and as a consequence the Company urgently
requires additional working capital.
Robert Davies, John Dalton and Mike James (the "Investors") have agreed to
provide the Loan of #750,000 to the Company, which the Directors believe, will
enable the Company to repay its legacy debts and provide sufficient working
capital for the Company's present requirements.
The Board intends to drawdown #250,000 of the Loan within five business days of
approval of the EGM resolutions to meet the immediate cash requirements of the
Group and to enable it to continue trading whilst the cash flow position
improves. The Board anticipates that the Group will continue to make losses in
the immediate future but that in 2004 the Group should start to see a positive
cash flow from its current operations. In addition to meeting the Group's
working capital requirements the Board intends to use the Loan to invest in the
continued development of the Group's businesses.
Details of the Loan
On 28 November 2003 the Investors and the Company entered into an agreement
pursuant to which the Investors agreed to make a loan facility of up to #750,000
available to the Group. Under the terms of that agreement the Loan can be drawn
down in three tranches of #250,000 subject to certain conditions precedent being
satisfied (one of these is the approval of the Loan at an EGM).
The Loan is to be secured by a debenture from each of Farsight plc, Farsight
Security Limited and e-surveillance Software Limited and a cross company
guarantee from each of these three companies and is to be non-interest bearing.
The Investors have an option to convert the outstanding balance of the Loan into
Ordinary Shares at a conversion price of 1p at any time prior to the second
anniversary of the date of agreement but if that option is not exercised then
the Loan shall be repaid on the second anniversary of the date of the agreement.
The City Code on Takeovers and Mergers
Under Rule 9 of the City Code ("Rule 9"), when any person or group of persons
acquires shares which, when taken together with shares already held by him or
shares held or acquired by persons acting in concert with him, carry 30 per
cent. or more of the voting rights of a company which is subject to the City
Code, that person is normally required to make a general offer to all the
shareholders of that company at the highest price paid by him, or any person
acting in concert with him, within the preceding twelve months.
Under the City Code, a concert party arises where persons acting in concert
pursuant to an agreement or understanding (whether formal or informal) actively
co-operate, through the acquisition by them of shares in a company, to obtain or
consolidate control of that company. Control means holdings, or aggregate
holdings, of shares carrying 30 per cent. or more of the voting rights of the
company, irrespective of whether the holding or holdings give de facto control.
The Investors and their connected persons (the "Concert Party") currently hold
119,806,788 Ordinary Shares representing approximately 39.61 per cent. of the
Existing Ordinary Shares. Immediately following the admission of 3,250,000 new
ordinary shares being issued immediately following the EGM, the Concert Party
will hold 119,806,788 Ordinary Shares, representing approximately 39.19 per
cent. of the enlarged issued Ordinary Share capital. In the absence of any other
changes to the Company's issued Ordinary Share capital, the exercise of the
conversion rights of the Loan, assuming full drawdown and conversion, would
result in the Concert Party having a maximum aggregate shareholding representing
approximately 51.17 per cent. of the issued share capital of the Company.
The Panel on Takeovers and Mergers has agreed, subject to EGM Resolution 1 being
passed on a poll by the independent shareholders (being shareholders other than
the Concert Party) at the Extraordinary General Meeting, to waive the obligation
of the Investors to make a general offer to shareholders under Rule 9 which
would otherwise arise upon conversion of the Loan (the "Waiver").
The Waiver is only in respect of any holding of Ordinary Shares arising from the
conversion of the Loan. Any acquisition of Ordinary Shares by other means will
be subject to the normal provisions of the City Code. Shareholders should note
that, assuming full drawdown and conversion of the Loan, the Concert Party will
control in excess of 50 per cent. of the issued Ordinary Share capital of the
Company. For so long as the Concert Party remain acting in concert and maintain
their aggregate shareholding above 50 per cent., further purchases by the
Concert Party will be unrestricted by Rule 9 and the Concert Party will not
incur a further obligation under Rule 9 to make a general offer, provided that
no individual member of the Concert Party acquires a holding of 30 per cent. or
more of the Ordinary Share capital.
The Investors have confirmed to the Directors that it would be their intention
that, following the issue of Ordinary Shares to them pursuant to a conversion of
the Loan, the businesses of the Group be continued in substantially the same
manner as at present, with no major changes, and that they have no intention
following any such issue to make any material amendment to the existing
employment rights of the Company's employees.
Extraordinary General Meeting
An Extraordinary General Meeting of the Company is to be held at the offices of
M and A Solicitors, Kenneth Pollard House, 5-19 Cowbridge Road East, Cardiff
CF11 9AB at 11.15 a.m. on 29 December 2003 (or as soon thereafter as the Annual
General Meeting convened for the same day has concluded or adjourned) to approve
resolutions required to implement the Loan and the Waiver.
Recommendation
The Directors, who have been so advised by Rowan Dartington & Co. Limited, the
Company's nominated adviser, consider the Loan to be in the best interests of
the Company and its shareholders as a whole. The Directors have unanimously
recommended shareholders to vote in favour of the resolutions to be proposed at
the Extraordinary General Meeting as they have undertaken to do in respect of
their own beneficial holdings which, in aggregate amount to 17,987,621 ordinary
shares representing approximately 5.95 per cent. of the Company's existing
ordinary shares.
This information is provided by RNS
The company news service from the London Stock Exchange
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