4 November 2019
AfriAg Global
PLC
(‘AfriAg’ or the
‘Company’)
Proposed Disposal,
Capital Reorganisation and Amendment to Memorandum and Articles
Notice of General
Meeting
The Company is pleased to announce that it has posted a notice
convening a General Meeting (the “Meeting”) of the Shareholders to
be held on 27 November 2019 at
11.00 a.m. at the offices of Hill
Dickinson LLP, 105 Jermyn Street, St. James’s, London, SW1Y 6EE.
At the Meeting, the Company’s shareholders will be asked,
amongst other things, to approve the disposal of the Company’s
African operations, to convert the ordinary shares of £0.001 each
to shares of no par value and to consolidate the shares on a 100:1
basis.
The circular and the Form of Proxy in relation to the General
Meeting are being posted today, and the Circular will shortly be
available for viewing on the Company’s website at
www.afriagglobal.com.
The Directors believe that in order for the Company to proceed
with the proposed acquisition of Apollon Formularies Limited the
Company must dispose of its subsidiaries, which operates its
African operations. As at 30 June
2019, the Company’s business has generated a loss of
£865,000.
A copy of the Executive Chairman’s letter, the expected
timetable of principal events and definitions sections contained in
the circular, are set out in full below in this announcement
without material amendment or adjustment.
The directors of the Company accept responsibility for the
contents of this announcement.
-ENDS-
For further information on AfriAg Global please visit the
www.afriagglobal.com or please contact;
AfriAg Global
Plc:
David Lenigas (Executive
Chairman)
+44 (0)20 7440 0640
Peterhouse Capital
Limited
+44 (0)20 7469 0930
Guy Miller
LETTER FROM THE
CHAIRMAN OF AFRIAG GLOBAL PLC
Directors:
Registered Office:
David
Lenigas
Quayside House
Hamish
Harris
6 Hope Street, Castle Town, Isle of
Man, IM9 1AS
Donald Strang
4 November
2019
Dear Shareholder
NOTICE OF GENERAL
MEETING
1
INTRODUCTION
The Company announced on 16 May
2019 that it has entered into conditional subscription
agreements with Apollon Formularies Ltd (Apollon) to
subscribe for ordinary shares in Apollon and that it would need to
raise approximately £1m to subscribe for a total of 4 million
shares in Apollon, representing circa 2.325 per cent. of Apollon’s
issued share capital (Subscription).
The Company announced on 24 May
2019 that it has raised £1,000,000 by a placing of
1,000,000,000 new Ordinary Shares with existing and new
institutional investors at a placing price of 0.1 pence per Placing Share and announced on
15 July 2019 that the Subscription
has been completed.
Following completion of the Subscription the Company intends to
seek shareholder approval for the proposed Share Capital
Reorganisation and Disposal in line with its business strategy in
order to proceed with discussions regarding the proposed
acquisition of the entire issued share capital of Apollon as
announced on 16 May 2019 (the
Proposed Acquisition).
It is important that you complete,
sign and return the Form of Proxy for use at the General Meeting
enclosed with this document whether or not you intend to attend the
meeting.
2 THE
PROPOSED DISPOSAL
The Board believes that in order for it to proceed with the
Proposed Acquisition it must dispose of its Subsidiaries, which
operates its African operations. As at 30
June 2019, the Company’s business has generated a loss of
£865,000. The Directors believe the market has not viewed the
Company’s achievements with respect to its investments in its
African operations favourably. Accordingly the Board intends to
seek shareholder approval to dispose of the entire issued share
capital (Sale Shares) of each of the Subsidiaries and
transfer circa £626,000 inter-company debt due and owing to the
Company to a third party buyer (Buyer). In consideration for
transferring the Sale Shares to the Buyer, the Buyer shall
indemnify the Company against all liabilities, costs, expenses,
damages and losses (including but not limited to any direct,
indirect or consequential losses, loss of profit, loss of
reputation and all interest, penalties and legal costs (calculated
on a full indemnity basis) and all other professional costs and
expenses suffered or incurred by the Company arising out of or in
connection with the: (i) Disposal; (ii) any claim by a third party
against the Company arising out of or in connection with the
provision of any services or supply of any goods by the
Company or the Subsidiaries; and (iii) any claim made by a
third party against the Company for death, personal injury, damage
to property arising out of or in connection with defective goods or
services supplied by the Company or the Subsidiaries.
3 THE
PROPOSED CONVERSION INTO ORDINARY SHARES OF NO PAR VALUE
3.1 Conversion
of Existing Ordinary Shares into New Ordinary Shares
The Company currently has 3,011,001,037 Existing Ordinary Shares
in issue, which are listed on the NEX Exchange. As at close
of business on 1 November 2019 (being
the latest practicable date prior to publication of this document)
the closing price of the Company’s Existing Ordinary Shares were
0.09 pence. Under Isle of Man law, a company is unable to issue
shares at a price which is less than the par value of the shares.
Therefore the Company is unable to issue any further shares which
places a significant constraint on raising further money.
Shareholders will be requested at the General Meeting to approve
the conversion of each Existing Ordinary Share into the same number
of New Ordinary Shares. If such conversion is approved it will not
alter the market value of a shareholder’s holding of shares in the
Company’s capital or their economic interest in the Company.
3.2 New
Articles
The Articles currently specify an authorised share capital of up
to 1,000,000,000 of £1,000,000. The par value of the Existing
Ordinary Shares is £0.001.
Under the Act the Directors may by resolution, subject to
contrary provisions in the Articles, alter the Company’s share
capital comprising shares with par value in any way. This power is
restricted by Article 11 of the Articles which provides that the
conversion of share capital into shares of a larger or smaller par
value requires approval from shareholders by ordinary resolution.
In order to enable the Company to raise new equity, the Board
considers that an amendment to alter the Articles to remove the par
value of the Existing Ordinary Shares is necessary. Set out in
section A to this document is a non-exhaustive list of changes
which have been to the Articles to alter them into the form of the
New Articles. In addition, shareholders may view on the
Company’s website (www.afriagglobal.com) a copy of the Articles
which have been marked up to highlight the changes being
proposed.
4 THE
PROPOSED CONSOLIDATION
Following the Conversion the Company will have 3,011,001,037 New
Ordinary Shares in issue. The Directors believe this is a
large number of shares. The effect of the proposed Consolidation
will be to reduce the number of Ordinary Shares in issue by a
factor of 100, whilst increasing the trading price of the Company’s
New Ordinary Shares. The Board considers the Consolidation is in
the best interests of the Company and its Shareholders, as it
believes the effect of the Consolidation will be to improve market
liquidity by reducing the volatility and spread of the Company’s
New Consolidated Ordinary Shares and make trading in the Company’s
shares more attractive to a broader range of institutional
investors and other members of the investing public. Following
completion of the Consolidation 30,110,011 New Consolidated
Ordinary Shares of no par value each, will be in issue.
One consequence of the proposed
Consolidation is that Shareholders holding fewer than 100 existing
Ordinary Shares will receive no new Ordinary Shares. This
consequence is illustrated in the table below:
Number of existing Ordinary Shares
currently held |
Number of New Ordinary Shares
held |
99 |
0 |
100 |
1 |
300 |
3 |
15,000 |
150 |
The Consolidation may result in fractional entitlements. These
fractional entitlements will be aggregated to create single New
Consolidated Ordinary Shares which will then be allocated by the
Company.
To effect the Consolidation, it will be necessary to issue an
additional 63 ordinary shares so that the Company’s issued ordinary
share capital is exactly divisible by 100. These additional
ordinary shares will be issued to the Company’s share registrar
before the record date for the Consolidation. Since these
additional shares would only represent a fraction of a New
Consolidated Ordinary Share, this fraction will be sold or
transferred pursuant to the arrangements set out below.
Where options and other rights have been granted in relation to
the ordinary shares, the numbers of New Consolidated Ordinary
Shares to which these rights apply will be adjusted to take account
of the Consolidation.
Share certificates in respect of the New Consolidated Ordinary
Shares, will be issued following the Consolidation or, in the case
of uncertificated holders, Euroclear UK and Ireland Limited will be
instructed to credit the CREST participant’s account with New
Consolidated Ordinary Shares.
The record date for the Consolidation will be 6.00 p.m. on 27 November
2019. Subject to the passing of the resolutions at the
General Meeting, CREST accounts will be credited on 28 November 2019 and new share certificates in
respect of the New Consolidated Ordinary Shares are expected to be
posted to certificated Shareholders in their new form within ten
days of Admission.
5 INFORMATION ON THE
COMPANY
Following the Disposal AfriAg will not hold any interest in any
subsidiary company and will hold the following investments:
- 2.325 % of the issued share capital of
Apollon; and
- 546 common stock in Tilray, Inc.
The Company will continue its investment strategy of investing
in the legal medicinal cannabis sector.
6 GENERAL
MEETING
Set out at the end of this Document is the Notice of General
Meeting convening the General Meeting to be held at 11 a.m. on 27 November
2019 at Hill Dickinson LLP, 105 Jermyn Street, St James’s,
London, SW1Y 6EE, at which the
following resolutions will be proposed.
Resolution 1:
Disposal
Resolution 1 is an ordinary resolution seeking shareholder
approval of the Disposal.
Resolution 2:
Adoption of New Articles
Resolution 2 is a special resolution seeking shareholder
approval for the adoption of the New Articles.
Resolution 3:
Conversion of Existing Ordinary Shares into New Shares (that is,
shares with no par value)
Resolution 3 is a special resolution, conditional on the passing
of Resolution 2, seeking shareholder approval for the conversion of
each Existing Ordinary Share into the same number of New Ordinary
Shares.
Resolution 4:
Consolidation
This is an ordinary resolution, conditional on the passing of
Resolution 3, seeking approval of the Consolidation.
7 ACTION
TO BE TAKEN
A Form of Proxy is enclosed for use in connection with the
General Meeting. Whether or not you intend to be present at the
General Meeting, you are requested to complete, sign and return the
Form of Proxy to the Company at Suite 3b, 38 Jermyn Street, London, SW1Y 6DN marked for attention of the
company secretary, as soon as possible but in any event so as to
arrive not later than 11 a.m. on
25 November 2019. The completion and
return of a Form of Proxy will not preclude you from attending the
meeting, or speaking and voting in person should you subsequently
wish to do so.
8
RECOMMENDATION
The Directors consider that the resolutions set out in the
notice of General Meeting are in the best interests of the Company
and its shareholders as a whole and accordingly, unanimously
recommend Shareholders to vote in favour of the Resolutions to be
proposed at the General Meeting.
Yours faithfully
David Lenigas
Executive Chairman
EXPECTED TIMETABLE
OF PRINCIPAL EVENTS
Posting of the circular and the Form
of Proxy |
on 4 November
2019 |
Latest time and date for receipt of
Forms of Proxy for the General Meeting |
11 a.m. on 25 November
2019 |
Last day of dealings in Existing
Ordinary Shares |
27 November 2019 |
General Meeting |
27 November 2019 |
Record Date |
6 p.m. on 27 November
2019 |
Announcement of the result of the
General Meeting |
on 27 November
2019 |
Admission and dealings in New
Ordinary Shares expected to commence |
7 a.m. on 28 November
2019 |
CREST accounts credited with New
Ordinary Shares |
28 November 2019 |
Expected date of despatch of
definitive share certificates for the New Ordinary Shares in
certificated form (certificated holders only) |
w/c 25 November
2019 |
DEFINITIONS
The following definitions apply throughout this document, unless
the context requires otherwise:
Act |
the Isle of Man
Companies Act, 2006. |
Admission |
the Admission of the New Ordinary
Shares to trading on the NEX Exchange. |
Articles or Articles of Association |
the articles of association of the Company from time to time. |
Board or Directors |
the board of directors of the Company for the time being. |
Company |
AfriAg Global PLC, a
public limited liability company incorporated and registered in the
Isle of Man with company number 002845V and registered office
address at Quayside House, 6 Hope Street, Castletown, Isle of Man,
IM9 1AS. |
Consolidation |
the proposed
consolidation of the Company’s ordinary share capital pursuant to
which every 100 Ordinary Shares will be consolidated into 1 New
Consolidated Ordinary Share pursuant to the Resolutions as set out
in the Notice of General Meeting. |
Conversion |
the conversion of
Existing Ordinary Shares into New Ordinary Shares pursuant to
Resolution 3. |
CREST |
the computerised
settlement system (as defined in the CREST Regulations) operated by
Euroclear which facilitates the holding and transfer of title to
shares in uncertificated form. |
CREST Regulations |
the
Uncertificated Securities Regulations 2001
(SI 2001 No. 3755) as amended. |
Disposal |
means the disposal by
the Company of the entire issued share capital of each of the
Subsidiaries and transfer of circa £626,000 of inter-company debt
due and owing to the Company to a third party buyer pursuant to the
Disposal SPA. |
Disposal SPA |
means the sale and
purchase agreement to be entered into by the Company and a third
party buyer in respect of the Disposal. |
Euroclear |
Euroclear UK
& Ireland Limited, a company
incorporated in England and Wales and the operator of
CREST. |
Existing Ordinary Shares |
the existing ordinary
shares of £0.001 each in the capital of the Company in issue as at
the close of business on 31 October 2019.
. |
FCA |
the Financial Conduct
Authority of the United Kingdom. |
FSMA |
the Financial Services
and Markets Act 2000, as amended. |
Form of Proxy |
the form of proxy for
use at the General Meeting. |
General Meeting |
the general meeting of
the Company convened pursuant to the Notice and to be held at the
offices of Hill Dickinson LLP at 105 Jermyn Street, St. James’s,
London, SW1Y 6EE at 11 a.m. on 27 November 2019. |
London Stock Exchange |
London Stock Exchange
PLC. |
New Articles |
the articles of
association that will be adopted by the Company if the Resolutions
are passed. |
New Ordinary Shares |
the new ordinary shares
of no par value each. |
New Consolidated
Ordinary Shares |
the new consolidated ordinary shares
of no par value each arising on completion of the
Consolidation. |
NEX Exchange |
NEX Exchange Limited, a
recognised investment exchange under section 290 of FSMA. |
NEX Exchange Growth
Market |
the primary market for unlisted
securities operated by the NEX Exchange. |
NEX Exchange Rules |
the NEX Exchange Growth
Market Rules for Issuers, which set out the admission requirements
and continuing obligations of companies seeking admission to and
whose shares are admitted to trading on the NEX Exchange Growth
Market. |
Notice |
the notice of General
Meeting set out at the end of this document. |
Record Date |
6 p.m. on 27 November
2019 *(or such time and date as the Directors may determine). |
Resolutions |
the resolutions to be
proposed at the General Meeting which are set out in the
Notice. |
Share Capital
Reorganisation |
Together the Conversion and the
Consolidation. |
Subsidiaries |
means AfriAg Ltd, a
company incorporated I the British Virgin Islands; and AfriAg
Limited, a company incorporated in England and Wales. |
UK or United
Kingdom |
the United Kingdom of
Great Britain and Northern Ireland. |
uncertificated |
recorded on the relevant
register of the share or security concerned as being held in
uncertificated form in CREST and title to which, by virtue of the
CREST Regulations may be transferred by means of CREST. |