Issue of Equity
THE THROGMORTON TRUST PLC
ONE FOR FIVE BONUS ISSUE OF SUBSCRIPTION SHARE OFFER
3 September 2009
Further to the Company's announcement on 3 July 2009 that the Board was
considering proposals for a bonus issue of Subscription Shares to existing
Shareholders, the Board is today publishing its proposals in relation to the
one for five Bonus Issue of Subscription Shares. The Bonus Issue requires the
Company to adopt New Articles and to obtain authorities to increase its
authorised share capital and allot the Subscription Shares. As these matters
require Shareholder approval, the Bonus Issue is conditional on the passing of
the Resolution to be proposed at the General Meeting of the Company to be held
at 10.30am on 1 October 2009, as well as the admission of the Subscription
Shares to the Official List and to trading on the London Stock Exchange.
The Bonus Issue
The Company is proposing to issue Subscription Shares to Qualifying
Shareholders on the basis of one Subscription Share for every five Existing
Ordinary Shares held on the Record Date, subject to the passing of the
Resolution set out in the Notice of General Meeting and Admission. The
Subscription Shares will be issued by way of a bonus issue to Qualifying
Shareholders.
Each Subscription Share will confer the right, exercisable by notice to the
Company which may be given quarterly on each of 31 January, 30 April, 31 July
and 31 October between 31 January 2010 and 31 October 2011 (both dates
inclusive), to convert, on the relevant date, into one Ordinary Share of the
Company, after which the Subscription Share Rights will lapse. The Ordinary
Shares arising on conversion will be allotted within ten Business Days of the
relevant exercise date.
The Subscription Price will be equal to the published unaudited NAV (including
current year revenue) per Ordinary Share as at 5.00 p.m. on 30 September 2009,
plus a 1 per cent. premium to such amount, rounded up to the nearest whole
penny.
Qualifying Shareholders' entitlements will be assessed against the register of
members on the Record Date, which is expected to be close of business on 30
September 2009.
Subscription Shares will rank equally with each other and will not carry the
right to receive any dividends from the Company or the right to attend and vote
at general meetings of the Company.
The NAV for the purpose of calculating the Subscription Price will be the
unaudited value of the Company's assets calculated in accordance with the
Company's accounting policies (including revenue items for the current
financial year) less all prior charges and other creditors at their fair value
(including the costs of the Bonus Issue). Prior charges include all loans and
overdrafts that are to be used for investment purposes.
The New Articles provide that the Subscription Price is subject to adjustment
upon the occurrence of certain corporate events by or affecting the Company
before 31 October 2011. The relevant corporate events include consolidations or
sub-divisions of share capital, pre-emptive offers of securities to Ordinary
Shareholders, takeover offers and the liquidation of the Company. Such
adjustments serve to protect either the intrinsic value or the time value of
the Subscription Shares, or both.
The 1 per cent. premium and the resulting Subscription Price reflect the
Board's confidence in the Company's medium to long term prospects and its hope
that holders of Subscription Shares will be able to exercise their Subscription
Share Rights and acquire Ordinary Shares on favourable terms in the future.
It is expected that an announcement setting out the Subscription Price will be
made on 1 October 2009.
The Directors believe the Bonus Issue of Subscription Shares will have the
following advantages:
• Qualifying Shareholders will receive securities which they may convert into
Ordinary Shares at a predetermined price in order to benefit from any future
growth in the Company;
• Qualifying Shareholders will receive securities with a monetary value which
may be traded in a similar fashion to their existing Ordinary Shares or
converted into Ordinary Shares;
• on any exercise of the Subscription Share Rights, the capital base of the
Company will increase allowing operating costs to be spread across a larger
number of Ordinary Shares and hence should cause the total expense ratio to
fall;
• it represents an opportunity for Shareholders to participate in any future
net asset growth of the Company through subscribing for Ordinary Shares;
• it potentially increases the size of the Company;
• following the exercise of any Subscription Share Rights, the Company will
have an increased number of Ordinary Shares in issue, which may in due course
improve the liquidity in the market for its Ordinary Shares; and
• Qualifying Shareholders will receive securities which are qualifying
investments for the purposes of the stocks and shares component of an ISA and
permitted investments for the purposes of a SIPP.
The implementation of the Bonus Issue will require Shareholders to approve the
Resolution, which will be proposed at the General Meeting as a special
resolution. If passed, the Resolution will:
a. approve the adoption of New Articles containing the rights attaching to the
Subscription Shares;
b. authorise the Directors to allot the Subscription Shares pursuant to the
Bonus Issue;
c. authorise the capitalisation of sums standing to the credit of the
Company's share premium account, capital redemption reserve, other reserve
and any other applicable reserves (excluding the profit and loss account)
in paying up the Subscription Shares to be issued pursuant to the Bonus
Issue;
d. authorise the consolidation, sub-division or redemption of any share
capital in connection with the exercise of the Subscription Share Rights so as
to enable conversion of the Subscription Shares into Ordinary Shares in
accordance with the Subscription Share Rights; and
e. authorise the repurchase by the Company of Subscription Shares representing
up to 14.99 per cent. of the Company's issued Subscription Share capital
following Admission (subject to certain conditions), as more fully described
below.
Authority to repurchase Subscription Shares
In order to allow the Company to repurchase Subscription Shares, the Resolution
will grant the Company authority to buy back up to 14.99 per cent. of the
issued Subscription Share capital following Admission.
Repurchases of Subscription Shares will be made at the discretion of the Board,
and will only be made when market conditions are considered by the Board to be
appropriate and in compliance with the provisions of the Listing Rules
prohibiting the purchase by a company of its own securities during certain
periods. Purchases through the market will not exceed the higher of (i) 5 per
cent. above the average of the middle market quotations (as derived from the
Official List) for the 5 consecutive dealing days ending on the dealing day
immediately preceding the date on which the purchase is made and (ii) the
higher of the price quoted for (a) the last independent trade of, or (b) the
highest current independent bid for, any number of Subscription Shares on the
trading venue where the purchase is carried out.
Any Subscription Shares repurchased by the Company shall be cancelled and shall
not be held in treasury for re-issue or resale.
It is anticipated that authorisation for repurchases of Subscription Shares
will be sought at the Company's annual general meetings in 2010 and beyond.
Admission and dealings
The Subscription Shares will be in registered form and may be issued either in
certificated or uncertificated form. No temporary documents of title will be
issued. Pending despatch of definitive certificates, transfers of Subscription
Shares in certificated form will be certified against the Register. All
documents or remittances sent by or to Shareholders will be sent through the
post at the risk of the Shareholder.
Applications will be made to the UK Listing Authority for the Subscription
Shares to be admitted to the Official List and to the London Stock Exchange for
such shares to be admitted to trading on its market for listed securities. It
is expected that Admission will occur, and that dealings will commence, on 2
October 2009. On Admission, the Subscription Shares will confer rights to
subscribe for new Ordinary Shares representing, in aggregate, up to 20 per
cent. of the then issued ordinary share capital of the Company.
The Ordinary Shares resulting from the exercise of the Subscription Share
Rights will rank pari passu with the Ordinary Shares then in issue (save for
any dividends or other distributions declared, made or paid on the Ordinary
Shares by reference to a record date prior to the allotment of the relevant
Ordinary Shares).
General Meeting
The Bonus Issue is conditional on, in addition to Admission, the approval by
Shareholders of the Resolution to be proposed at a General Meeting of the
Company which has been convened for 1 October 2009. The Resolution will be
proposed as a special resolution. The Board is recommending that Shareholders
vote in favour of the Resolution.
A copy of the notice of general meeting to consider the proposals for a bonus
issue of Subscription Shares and the adoption of new Articles and the
prospectus in relation to the bonus issue of Subscription Shares will shortly
be available for inspection at the UK Listing Authority's Document Viewing
Facility, which is situated at:
Financial Services Authority
25 The North Colonnade
Canary Wharf
London
E14 5HS
Tel. No: +44 (0)20 7066 1000
Expected timetable:
Subscription Price of Subscription
Shares calculated Close of business on 30 September
Record date for the Bonus Issue Close of business on 30 September
General meeting to approve the
Bonus Issue 10.30am on 1 October
Announcement of the Subscription
Price 1 October
Admission of the Subscription Shares
To the Official List and dealings in
Subscription Shares commence 8:00am on 2 October
Enquiries:
Jonathan Ruck Keene
BlackRock Investment Management (UK) Limited
Telephone: 020 7743 3000
Joe Winkley/Sapna Shah
Oriel Securities Limited
Telephone: 020 7710 7600
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