TIDMPCGE
RNS Number : 0679A
PCG Entertainment plc
21 December 2017
21 December 2017
The information contained within this announcement is deemed by
the Company to constitute inside information as stipulated under
the Market Abuse Regulation (EU) No. 596/2014 ("MAR").
PCG ENTERTAINMENT PLC
("PCGE", THE "COMPANY" OR THE "GROUP")
PCG ENTERTAINMENT PLC / INDEX: AIM / EPIC: PCGE
Notice of Extraordinary General Meeting & Proposed Capital
Reorganisation
The Company today announces the posting of a notice of an
Extraordinary General Meeting of the Company (the "EGM"), to be
held at 10.00am on 15th January 2018 at Suite 16, Watergardens 5,
Waterport Wharf, Gibraltar.
At the EGM, the Company will be seeking shareholder approval to
carry out a capital reorganisation, through which it is proposed
that every 5 existing ordinary shares of 0.1 pence each in the
Company will be consolidated and then sub-divided into 1 deferred
share of 0.4p each (the "Deferred Shares") and 1 new ordinary share
of 0.1 pence each (the "New Ordinary Shares") (together the
"Capital Reorganisation").
Application will be made to the London Stock Exchange plc for
the admission of the New Ordinary Shares to trading on AIM
("Admission") subject to the Company receiving shareholder approval
of the Capital Reorganisation at the EGM. It is expected that
Admission of will become effective and that dealings in the New
Ordinary Shares will commence on 16th January 2018. No admission to
trading will be sought for the Deferred Shares, which are expected
to have no material value.
A letter from the Chairman of the Company, which is set out in
the circular accompanying the notice of the EGM that has been sent
to Shareholders today, can be found below. A full copy of the
notice of the EGM can be found at www.pcge.com. Defined terms are
as set out in the circular.
Enquiries:
PCG Entertainment Plc
Richard Poulden, Chairman Tel: +44 207 812 0645
Allenby Capital Limited (Nominated Adviser)
Nick Naylor/Nick Harriss Tel: +44 20 3328 5656
Beaufort Securities Limited (Broker)
Elliot Hance Tel: +44 20 7382 8300
Damson Communications
Abigail Stuart-Menteth/Amelia Hubert Tel: +44 20 7812 0645
EXPECTED TIMETABLE OF PRINCIPAL EVENTS
Publication of circular 21 December 2017
Latest time and date for return of Forms of Proxy/Forms of
Direction 10 a.m. (CET), 13 January 2018
General Meeting 10 a.m. (CET), 15 January 2018
Record Time for the Capital Reorganisation and final date of 6
p.m., 15 January 2018
trading for the Existing Ordinary Shares
Admission effective and dealings in the New Ordinary Shares 8
a.m., 16 January 2018
expected to commence on AIM and CREST accounts credited
Expected date for despatch of definitive certificates for New
Ordinary Shares 14 days after Admission
LETTER FROM THE CHAIRMAN OF PCGE ENTERTAINMENT PLC
Dear Shareholders,
Proposed Capital Reorganisation, amendments to the Memorandum
and Articles of Association and Notice of General Meeting
1. Introduction
It is proposed that at a forthcoming General Meeting,
Shareholders will be asked to approve the Capital
Reorganisation.
The Company currently has 3,524,940,507 Existing Ordinary
Shares. The Directors consider that it is in the best interests of
the Company's long term development as a public quoted company to
have a more manageable number of issued ordinary shares and to have
a higher share price.
The Capital Reorganisation, which comprises a consolidation and
sub-division of shares, has been structured in such a way so that
each of the New Ordinary Shares created pursuant to the Capital
Reorganisation shall have a nominal value of 0.1 pence. This is
achieved by a consolidation of every 5 Existing Ordinary Shares
into one Consolidated Share followed by an immediate sub-division
of each Consolidated Share into one New Ordinary Share of 0.1 pence
and one Deferred Share of 0.4 pence.
All of the Existing Ordinary Shares are proposed to be
consolidated, meaning that whilst the number of shares held will
change, the proportion of issued ordinary shareholdings in the
Company held by each Shareholder immediately before and immediately
after the Consolidation will remain unchanged, save for fractional
entitlements (which are described below). This should also mean
that the value of existing shareholdings in the market also will
not change although the price per share will do so.
The Capital Reorganisation is subject to Shareholders' approval
at the General Meeting, notice of which is set out at the end of
this Document.
The purpose of this Document is to provide Shareholders with
details of the Capital Reorganisation and to explain why the
Directors are recommending Shareholders vote in favour of this at
the General Meeting.
Following the Capital Reorganisation, assuming the issued share
capital of the Company will comprise 704,988,102 New Ordinary
Shares and 704,988,102 Deferred Shares, the total issued share
capital of the Company will be GBP3,524,940.51. Pursuant to the
share capital authorities granted to the Directors in December
2016, the Directors will have the ability, following the Capital
Reorganisation, to allot further shares with an aggregate nominal
value of GBP2,475,059.49.
2. Purpose of the Capital Reorganisation
The Company's issued ordinary share capital currently consists
of 3,524,940,507 Existing Ordinary Shares. As a result of the
number of shares in issue, which is significantly higher than many
companies whose shares are traded on AIM, the Board believes that
the low share price affects investor perception of the Company and
share price volatility. Further, as a Gibraltar incorporated public
company the Company is unable to issue shares for less than the
nominal value of its ordinary shares. As the Company's share price
has been trading below nominal value, the directors are also
mindful that, without the Capital Reorganisation, the Company may
not be able to raise funds as opportunities present themselves.
Accordingly, the objective of the Capital Reorganisation is to
reduce the number of Existing Ordinary Shares to a level which is
more in line with other comparable AIM-traded companies with the
intention of also creating a higher share price per ordinary share
in the capital of the Company. The Directors believe that the
Capital Reorganisation should improve the liquidity and
marketability of the ordinary shares.
3. Proposed Capital Reorganisation
The proposed Capital Reorganisation will comprise three
elements:
i. Amendment of memorandum and articles of association (the "New Articles").
ii. Consolidation - Every 5 Existing Ordinary Shares will be
consolidated into one Consolidated Share.
iii. There will then be a Sub-Division, immediately following
the Consolidation, such that each Consolidated Share will then be
sub-divided into one New Ordinary Share of 0.1 pence and one
Deferred Share of 0.4 pence.
The Capital Reorganisation requires the passing of the
shareholder resolutions in relation to the amendment of the
memorandum and articles of association of the Company and the
Capital Reorganisation, being resolutions numbered 1 and 2, at the
General Meeting, which is to be held at held at Suite 16,
Watergardens 5, Waterport Wharf, Gibraltar on 15th January 2018 at
10.00 a.m. (CET). If the Resolutions are passed, the Capital
Reorganisation will become effective immediately following close of
business on that date, subject only to Admission the following
business day.
4. Memorandum and Articles of Association
Due to the proposed Capital Reorganisation the Company needs to
amend its memorandum and articles of association to establish the
Deferred Shares, and set out the rights and obligations attaching
thereto. Resolution 1 to be considered at the General Meeting
proposes that the memorandum and articles of association of the
Company be amended.
The New Ordinary Shares arising upon implementation of the
Capital Reorganisation will have the same rights as the Existing
Ordinary Shares including voting, dividend, return of capital and
other rights.
The Deferred Shares will not entitle the holder thereof to
receive notice of or attend and vote at any general meeting of the
Company or to receive a 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 participate in
the distribution of the assets of the Company pari passu with the
holders of the New Ordinary Shares, but only in respect of any
excess of those assets above GBP1,000,000,000,000. The holders of
the Deferred Shares shall not be entitled to any further right of
participation in the assets of the Company. 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.
It is proposed that the Company amend its Articles as set out in
Resolution 1. The New Articles will reflect the rights attaching to
the New Ordinary Shares and the Deferred Shares. The practical
effect of the Capital Reorganisation, if implemented, will be that
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 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 to be admitted to
trading on AIM and it is currently expected that admission to
trading in the New Ordinary Shares will become effective and
dealings commence at 8.00 a.m. on 16th January 2018.
No other changes to the current Articles are included in the New
Articles.
5. Consolidation
At the General Meeting, the Directors are inviting Shareholders
to approve the Resolutions which will authorise the Consolidation
pursuant to which every 5 Existing Ordinary Shares will be
consolidated into one Consolidated Share.
In anticipation of the Resolutions being passed by the
Shareholders, the Company will, immediately prior to the General
Meeting, issue such number of additional Ordinary Shares as will
result in the total number of Ordinary Shares in issue being
exactly divisible by 5. Assuming no other Ordinary Shares are
issued between the date of this Document and immediately before the
General Meeting, this will result in 3 additional Ordinary Shares
being issued and will create 704,988,102 Consolidated Shares
(subject to any revision to the Company's issued share capital
between the date of this Document and the Record Time).
As all of the Existing Ordinary Shares are proposed to be
consolidated, the proportion of issued ordinary shareholdings in
the Company held by each Shareholder immediately before and
immediately after the Consolidation will, save for fractional
entitlements, remain unchanged.
In the event that the number of Existing Ordinary Shares
attributed to a Shareholder is not exactly divisible by 5, the
Consolidation will generate an entitlement to a fraction of a
Consolidated Share. On the Sub-Division, such fractional
entitlements will be carried over to the relevant New Ordinary
Shares but not the Deferred Shares, and the New Ordinary Shares
which comprise fractional entitlements will then be sold or passed
to charity (see further explanation at paragraph 7 below,
Fractional Entitlements to Consolidated Shares, below).
Accordingly, following the implementation of the Capital
Reorganisation, any Shareholder who as a result of the
Consolidation, has a fractional entitlement to any New Ordinary
Shares, will not have a proportionate shareholding of New Ordinary
Shares exactly equal to their proportionate holding of Existing
Ordinary Shares.
Furthermore, any Shareholders holding fewer than 5 Existing
Ordinary Shares as at the Record Time will cease to be a
shareholder of the Company. The minimum threshold to receive
Consolidated Shares will be 5 Existing Ordinary Shares.
6. Sub-Division
Immediately following the Consolidation, each Consolidated Share
will be sub-divided into one New Ordinary Share and one Deferred
Share. The Sub-Division has been structured in such a way so that
each of the New Ordinary Shares will have a nominal value of 0.1
pence each. Where there are fractional entitlements to a
Consolidated Share, the Board considers it fair that, upon
Sub-Division, the same fractional entitlements to a Consolidated
Share will apply to each New Ordinary Share but not a Deferred
Share. The rights attached to the Deferred Shares are described in
this Document. The Record Time for the Sub-Division will be the
same as for the Consolidation, which is 6.00 p.m. on 15th January
2018.
Fractional Entitlements
7. to Consolidated Shares
The Consolidation will give rise to fractional entitlements to a
Consolidated Share where any holding is not precisely divisible by
5. On Sub-Division of any such Consolidated Share which occurs
immediately thereafter, the same fractional entitlement will apply
to each New Ordinary Share but not a Deferred Share then arising.
As regards the New Ordinary Shares, no certificates regarding
fractional entitlements will be issued. Instead any New Ordinary
Shares in respect of which there are fractional entitlements will
be aggregated and sold or passed to charity. The Board is of the
view that, as a result of the disproportionate costs, it would not
be in the best interests of the Company to distribute any proceeds
of sale which instead would be retained for the benefit of the
Company.
For the avoidance of doubt, the Company is only responsible for
dealing with fractions arising on registered holdings. For
Shareholders whose shares are held in the nominee accounts of UK
stockbrokers, the effect of the Capital Reorganisation on their
individual shareholdings will be administered by the stockbroker or
nominee in whose account the relevant shares are held. The effect
is expected to be the same as for shareholdings registered in
beneficial names, however, it is the stockbroker's or nominee's
responsibility to deal with fractions arising within their customer
accounts, and not that of the Company.
8. Resulting issued share capital
The issued share capital of the Company immediately following
the Capital Reorganisation (assuming it is approved by the
Shareholders) is expected to comprise 704,988,102 New Ordinary
Shares and 704,988,102 Deferred Shares.
9. Admission of the New Ordinary Shares
As stated above, application will or has been made for the New
Ordinary Shares to be admitted to trading on AIM in place of the
Existing Ordinary Shares. It is expected that Admission will become
effective and that dealings in the New Ordinary Shares will
commence on 16th January 2018.
The Company has applied for a new ISIN and SEDOL which will
become effective following the Capital Reorganisation. The new ISIN
and SEDOL will be notified to the market via an RIS provider in due
course.
Shareholders who hold Existing Ordinary Shares in uncertificated
form via depositary interests will have such shares disabled in
their CREST accounts on the Record Time, and their CREST accounts
will be credited with the New Ordinary Shares following
Admission.
Following the Capital Reorganisation, existing share
certificates will cease to be valid and new share certificates are
expected to be despatched to those Shareholders who hold their
Existing Ordinary Shares in certificated form on or around 14 days
after Admission. No share certificates will be issued in respect of
Consolidated Shares or Deferred Shares.
10. Effects on options, warrants and other instruments
The entitlements to Ordinary Shares of holders of securities or
instruments convertible into Ordinary Shares (such as share options
and warrants) will be adjusted to reflect the Capital
Reorganisation. Certain adjustments will also be needed in respect
of the Equity Sharing Agreement dated 18 August 2017 entered into
between the Company and D-Beta One EQ, Ltd. to reflect the impact
of the Capital Reorganisation
11. Share capital authorities
Following the Capital Reorganisation, assuming the issued share
capital of the Company will comprise 704,988,102 New Ordinary
Shares and 704,988,102 Deferred Shares, the total issued share
capital of the Company will be GBP3,524,940.51. Pursuant to the
share capital authorities granted to the Directors in December
2016, the Directors will have the ability, following the Capital
Reorganisation, to allot further shares with an aggregate nominal
value of GBP2,475,059.49.
12. General Meeting
You will find set out at the end of this Document a notice
convening the General Meeting to be held at Suite 16, Watergardens
5, Waterport Wharf, Gibraltar on 15th January 2018 at 10.00 a.m.
(CET) for the purpose of considering and, if thought fit, passing
the Resolutions.
13. Taxation in relation to the Capital Reorganisation
If any shareholder is uncertain about his own tax position, he
should seek independent financial advice.
14. Action to be taken
Holders of Existing Ordinary Shares will find enclosed with this
Document a Form of Proxy and Form of Direction for use by them at
the General Meeting. Whether or not you are able to attend the
General Meeting, you are requested to complete the enclosed Form of
Proxy or Form of Direction and return it to the Company's
Registrars, Link Asset Services Limited, at 34 Beckenham Road,
Beckenham, Kent BR3 4ZF or to the Company at the Company's
Registered Office at G1 Haven Court, 5 Library Ramp, Gibraltar as
soon as possible and, in any event, so as to arrive by 10.00 am
(CET) on 13th January 2018. The completion and return of a Form of
Proxy or Form of Direction will not prevent you from attending the
General Meeting and voting in person if you subsequently wish to do
so. However, please note that Shareholders who hold Existing
Ordinary Shares in uncertificated form via depositary interests and
who wish to attend the General Meeting should request a Letter of
Representation by contacting Link Market Services Trustees Limited,
the Depositary at 34 Beckenham Road, Beckenham, Kent, BR3 4ZF or
email custodymgt@linkgroup.co.uk by no later than 48 hours before
the General Meeting or 72 business hours before the time appointed
for holding any adjourned meeting. If you are in any doubt as to
what action you should take, you are recommended to seek your own
personal financial advice from your broker, bank manager,
solicitor, accountant or other independent financial adviser
authorised under the Financial Services and Markets Act 2000 (as
amended) if you are resident in the United Kingdom or, if not, from
another appropriately authorised independent financial adviser,
immediately.
15. Recommendation
The Directors consider that the Capital Reorganisation and the
other Resolutions are fair and reasonable and are in the best
interests of the Company and its Shareholders as a whole and will
promote the success of the Company. The Directors therefore
recommend you to vote in favour of each of the Resolutions as they
intend to do in respect of their own shareholdings in the
Company.
Yours faithfully,
Richard Poulden
Chairman
This information is provided by RNS
The company news service from the London Stock Exchange
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December 21, 2017 05:25 ET (10:25 GMT)