10 November 2015
PowerHouse Energy Group
plc
(“PowerHouse” or the “Company”)
Notice of Annual General
Meeting, Proposed Capital Reorganisation
& Proposed Grant of Share Options
PowerHouse Energy Group, plc announces that the Annual General
Meeting (“AGM”) of the Company for the year to 31 December 2014 will be held at the offices of
Allenby Capital Limited, 3 St Helen’s Place, London EC3A 6AB at 10.00 a.m. on 3 December
2015. Notice of the AGM has been sent to all shareholders
today, a copy has also been posted on the Company’s website and
full details of the resolutions proposed is set out below.
Amongst the resolutions is a proposed capital reorganisation and
grant of share options to the directors of the Company.
For additional information please
contact:
PowerHouse Energy Group plc
Keith Allaun +1 352 226
8644/+44 7887 588 941
Allenby Capital Limited (Nominated Adviser and Broker)
Nick Harriss/David Hart
+44 (0) 20 3328 5656
Notice of Annual General Meeting
1. Introduction
Notice of the 2015 Annual General Meeting of the Company is set
out at the end of this document. The audited accounts of the
Company for the year ended 31 December
2014 were sent to Shareholders on 30
June 2015 and are also available for download on the
Company's website at www.powerhouseenergy.net.
The purpose of this document is to provide you with the
background to the Capital Reorganisation and the other resolutions
to be proposed at the AGM, and to explain why the Directors
consider them to be in the best interests of the Company and the
Shareholders as a whole, and why the Directors recommend that
Shareholders should vote in favour of the resolutions at the
AGM. Further details on the resolutions are set out
below.
2. Hillgrove
As announced on 30 June 2015 and
as set out in the Chairman’s statement in the audited accounts for
the year ended 31 December 2014, the
Company agreed on 26 June 2015 to
certain changes in the terms of the convertible loan note granted
to Hillgrove in July 2012, providing
inter alia that the conversion price for the entire convertible
loan note be changed from 1p per share to 0.5p per share.
This and other changes were required by Hillgrove in consideration
for the provision of a letter of comfort to the Company confirming
that Hillgrove is willing to continue to provide adequate financial
support to ensure that the Company can meet its obligations as they
fall due and that it can operate as a going concern for at least 12
months from 30 June 2015, pending any
unforeseeable or material changes to the Company’s current
circumstances.
If at any time Hillgrove was to
withdraw its ongoing support for the Company, it is likely that the
Company would have insufficient funds to continue, and the Company
would no longer be a going concern. In addition, if
Shareholders do not approve resolution 5 at the AGM to effect the
Capital Reorganisation, necessary to give effect to the change in
conversion price outlined above, this may also lead to HIllgrove
withdrawing its financial support. The Directors unanimously
strongly recommend that Shareholders vote in favour of resolution 5
at the AGM.
3. Proposed Capital
Reorganisation
The CA 2006 prohibits the Company from issuing ordinary shares
at a price below their nominal value. As described above, it
is necessary to reduce the nominal value of the Ordinary Shares in
order to afford Hillgrove the ability to convert its loan into
equity in the Company. In addition, as the Company’s current
share price is relatively close to the nominal value, the Directors
consider that it will facilitate the acquisition of additional
funding from Hillgrove and/or other potential investors if the
nominal value is reduced.
Accordingly, it is proposed that each of the Existing Ordinary
Shares of 1p be sub-divided into one New Ordinary Share of 0.5p and
one Deferred Share of 0.5p, such Deferred Shares having the rights
and being subject to the restrictions attached to them as set out
in the Articles.
The New Ordinary Shares will continue to carry the same rights
as are attached to the Existing Ordinary Shares.
The Deferred Shares will not entitle the holders of them to
receive notice of or to attend or vote at any general meeting of
the Company, or to receive any dividend or other
distribution. On a return of capital on a winding up or
dissolution of the Company, the holders of the Deferred Shares
shall be entitled to receive an amount equal to the nominal amount
paid up thereon, but only after the holders of the Ordinary Shares
have received the aggregate amount paid upon on them plus £100 per
Ordinary Share. The holders of Deferred Shares are not
entitled to any further right of participation in the assets of the
Company. The Company shall have the right to purchase the
Deferred Shares in issue at any time for no consideration. As
such, the Deferred Shares effectively have no value. Share
certificates will not be issued in respect of the Deferred Shares,
and they will not be admitted to trading on AIM.
Under the Capital Reorganisation, if approved, each Shareholder
will receive the same number of New Ordinary Shares as they hold in
Existing Ordinary Shares, without any diminution in rights.
The Capital Reorganisation should not, of itself, affect the market
value of a Shareholder’s aggregate holding of shares in the capital
of the Company.
Application will be made for the New Ordinary Shares to be
admitted to trading on AIM. It is expected that Admission
will come effective and that dealings in the New Ordinary Shares
will commence on 4 December 2015. The ISIN and SEDOL numbers
for the New Ordinary Shares will be the same as for the Existing
Ordinary Shares, being GB00B4WQVY43 and B4WQVY4 respectively.
Share certificates
and CREST entitlements
If you hold your Existing Ordinary Shares in certificated form,
your existing share certificate will remain valid, with reference
in any share certificate to a nominal value of 1p being deemed to
be a reference to a nominal value of 0.5p. If you hold your
Existing Ordinary Shares in uncertificated form, the description of
the shares held in your CREST account will be updated
accordingly. Shareholders will not be issued with a share
certificate in respect of the Deferred Shares.
If you are in any doubt with regard to your current holding of
Existing Ordinary Shares or the number of New Ordinary Shares or
Deferred Shares which you will hold following the implementation of
the Capital Reorganisation, you should contact the Company’s
Registrars, Neville Registrars Limited on 0121 585 1131 (calls to
this number will be charged at your standard network rate) or from
overseas on +44 121 585 1131. Calls from outside the UK will
be charged at the applicable international rates. Lines are
open from 9.00 a.m. to 5.00 p.m. on
business days (ie Monday to Friday excluding public
holidays). Different charges may apply to calls made from
mobile telephones and calls may be recorded and randomly monitored
for security and training purposes. Please note that Neville
Registrars cannot provide investment advice, nor advise you on how
to cast your vote on the Resolutions.
4. Authorities to
allot securities
At the Annual General Meeting, Shareholders are being asked to
renew the Directors’ authorities to allot shares in the
Company. Resolution 6 (an ordinary resolution) at the AGM
will, if passed, give the Directors general authority to allot
ordinary shares up to a maximum nominal amount of £3,250,000,
(representing approximately 167% of the issued ordinary share
capital of the Company following the Capital Reorganisation).
The authority will expire at the conclusion of the AGM of the
Company to be held in 2016 or, if earlier, 15 months from the date
of the resolution.
Resolution 7 (a special resolution) at the AGM will, if passed,
give the Directors general authority to allot ordinary shares for
cash, either by way of a rights issue or offer to existing
shareholders or to other persons on a non pre-emptive basis,
providing that such authority is limited to a maximum nominal
amount £3,250,000 (representing approximately 167% of the issued
ordinary share capital of the Company following the Capital
Reorganisation).
The authorities given by resolutions 6 and 7 will allow for the
conversion of the convertible loan notes held by Hillgrove, for the
grant of options to Directors as described below, and will provide
additional headroom to enable the Company to take advantage of
further fundraising opportunities in due course.
5. Grant of
options
It is proposed that options to subscribe for up to 15 million
New Ordinary Shares will be granted to the Directors, recognising
that Directors’ fees which have not been paid for a number of
years. It is proposed that such options would vest
immediately and be exercisable for up to 5 years at an exercise
price of 0.75p per share, which is 50% above the conversion price
for the convertible loan notes held by Hillgrove. It is
proposed that the options will be granted as follows:
Keith
Allaun
6 million options
Brent
Fitzpatrick
5 million options
James
Greenstreet 4
million options
The granting of the proposed options constitutes a related party
transaction for the purposes of Rule 13 of the AIM Rules for
Companies. As all the Directors are being granted options
under the proposals, there are no Directors who are independent for
the purposes of providing the statement required under Rule 13 of
the AIM Rules for Companies. Allenby Capital Limited, the
Company’s Nominated Adviser, considers that the terms of the grant
of options are fair and reasonable insofar as Shareholders of the
Company are concerned. The granting of the options to the
Directors is being proposed as resolution 8 at the Annual General
Meeting in order for shareholders to approve this, and no option
will be granted to the Directors unless Shareholders approve
resolution 8. The grant of options will also be conditional
upon the passing of resolutions 5, 6 and 7.
6. Annual General
Meeting
The Annual General Meeting of the Company will be held at the
offices of Allenby Capital Limited at 3 St Helen’s Place,
London EC3A 6AB at 10.00 a.m. on 3 December
2015, at which the following resolutions will be
proposed:
1.
(a)
Resolution 1: to approve the annual report and
accounts. The Directors are required to lay before the
Company at the AGM the accounts of the Company for the financial
year ended 31 December 2014, the
report of the Directors and the report of the Company's auditors on
those accounts.
2.
(b)
Resolution 2: to approve the re-appointment of Deloitte LLP
as auditors of the Company. The Company is required to
appoint auditors at each general meeting at which accounts are
laid, to hold office until the next such meeting.
3.
(c)
Resolution 3: to approve the remuneration of the auditors for
the next year.
4.
(d)
Resolution 4: to approve the re-election of Keith Allaun who is retiring by rotation, and is
submitting himself for re-election. Under the Articles of
Association, Directors must retire and submit themselves for
re-election at the annual general meeting once very three
years.
5.
(e)
Resolution 5: to approve the Capital Reorganisation, as
described above.
6. (f) Resolutions 6 and 7: to renew
authorities to allot shares, as described above.
7.
(g)
Resolution 8: to approve the grant of options to Directors,
as described above.
7. Action to be
taken
Shareholders will find enclosed with this document a form of
proxy for use at the Annual General Meeting, which should be
returned by no later than 10.00 a.m.
on 1 December 2015 for the AGM to be
held on 3 December 2015.
Whether or not you intend to be present at the meeting, you are
requested to complete, sign and return the form of proxy to the
Company’s registrars, Neville Registrars Limited, Neville House, 18 Laurel Lane, Halesowen,
West Midlands B63 3DA as soon as
possible but, in any event, so as to arrive by no later than 48
hours before the time and date of the meeting. The completion
and return of a form of proxy will not preclude you from attending
the meeting and voting in person should you wish to do so.
8.
Recommendation
The Directors consider the resolutions to be proposed at the
Annual General Meeting to be in the best interests of the Company
and its Shareholders as a whole and accordingly unanimously
recommend that Shareholders vote in favour of those resolutions, as
Brent Fitzpatrick intends to do in
respect of the 103,459 Existing Ordinary Shares
(equivalent to approximately 0.026 per cent of the Existing
Ordinary Shares) beneficially owned by him.
Yours faithfully
Robert Keith Allaun
Chairman
DEFINITIONS
The following definitions apply throughout this document, unless
the context otherwise requires:
“AIM” |
the market of that name operated by
London Stock Exchange plc |
“Admission” |
admission of the New Ordinary Shares
to trading on AIM and such admission becoming effective in
accordance with Rule 6 of the AIM Rules |
“Annual General
Meeting” or “AGM” |
the annual general meeting of the
Company to be held on 3 December 2015, notice of which is set out
at the end of this document |
“Articles” |
the articles of association of the
Company |
“Board” or
“Directors” |
the board of directors of the
Company |
“CA 2006” |
the Companies Act 2006, as
amended |
“Capital Reorganisation” |
the proposed sub-division of each
Existing Ordinary Share into one New Ordinary Share and one
Deferred Share |
“Company” |
Powerhouse Energy Group plc |
“CREST” |
the electronic settlement system for
UK and Irish securities operated by Euroclear UK & Ireland
Limited |
“CREST Regulations” |
The Uncertificated Securities
Regulations 2001, as amended |
“Deferred Shares” |
the proposed new deferred shares of
0.5p each in the capital of the Company to be created under the
Capital Reorganisation |
“Existing Ordinary
Shares” |
the 388,496,747 Ordinary Shares of
1p each in the capital of the Company in issue as at the date of
this document |
“form of proxy” |
the form of proxy accompanying this
document for use by Shareholders at the AGM |
“Hillgrove” |
Hillgrove Investments Pty
Limited |
“Ordinary Shares” |
ordinary shares in the capital of
the Company |
“New Ordinary Shares” |
the proposed new ordinary shares of
0.5p each in the capital of the Company to be created under the
Capital Reorganisation |
“Record Date” |
the record date and time for
implementation of the Capital Reorganisation, being 5.00 pm on 3
December 2015 (or such later date as the Directors may determine
and communicate to Shareholders by an appropriate announcement to a
Regulatory Information Service) |
“Regulatory Information
Service” |
any information service authorised
from time to time by the UK’s Financial Conduct Authority for the
purpose of disseminating regulatory announcements |
“Shareholders” |
the holders of Existing Ordinary
Shares or (following the Record Date) New Ordinary Shares from time
to time |
“UK” or “United
Kingdom” |
the United Kingdom of Great Britain
and Northern Ireland, its territories and dependencies |
“uncertificated” or “in
uncertificated form” |
recorded on the relevant register of
the share or security concerned as being held in uncertificated
from in CREST and title to which, by virtue of the CREST
Regulations, may be transferred by means of CREST |