TIDMMFX
RNS Number : 0602H
Manx Financial Group PLC
20 March 2020
FOR IMMEDIATE RELEASE 20 March 2020
Manx Financial Group PLC (the "Group")
Posting of Shareholder Circular
Proposed Share Buyback and Mandatory Cancellation by Manx
Financial Group Plc
and
Approve a Waiver of Obligations under Rule 9 of the Takeover
Code
incorporating a
Notice of Extraordinary General Meeting
Manx Financial Group PLC is pleased to announce that it has
today published a Shareholder Circular in connection with a p
roposed Share Buyback and Mandatory Cancellation of the Company's
Ordinary Shares held by Southern Rock Insurance Company Limited
("SRICL") and resultant requirement for approval by Shareholders of
a Waiver of Obligations under Rule 9 of the Takeover Code (the
"Circular"). The Circular includes a Notice of EGM to be held at
the Claremont Hotel, Loch Promenade, Douglas, Isle of Man IM1 2LX
at 11.00 a.m. on 9 April 2020.
Copies of the Circular are being sent to Shareholders today and
a copy is available on the Company's website
Extracts from the Circular are set out as an Appendix below.
This announcement contains inside information for the purposes
of Article 7 of EU Regulation No. 596/2014 on market abuse. Upon
the publication of this announcement via a Regulatory Information
Service, this inside information is now considered to be in the
public domain.
For further information, please contact: -
Manx Financial Group Beaumont Cornish Limited Britton Financial PR
PLC Roland Cornish/James Tim Blackstone
Denham Eke, Chief Executive Biddle Tel +44 (0) 7957 140416
Tel +44 (0)1624 694694 Tel +44 (0) 20 7628
3396
S
Appendix
Dear Shareholder
Proposed Share Buyback and Mandatory Cancellation by Manx
Financial Group Plc
and Waiver under Rule 9 of the Takeover Code
1. Share Buyback
The Company is the holding company for a group of companies with
operations in the Isle of Man and the UK (the "MFG Group").
The MFG Group offer financial services to both retail and
commercial customers. The principal operating companies in the MFG
Group are Conister Bank Limited ("Conister"), Edgewater Associates
Limited ("Edgewater") and Manx FX Limited. Both Conister and
Edgewater are regulated by the IOM FSA. Conister is also, in part,
regulated by the UK FCA holding certain Consumer Credit
Licences.
Over recent years, the MFG Group has improved its core
performance but is required by regulation to retain sufficient
regulatory capital within the MFG Group (in particular the core
operating subsidiaries) to allow for further growth and increased
profitability.
On 6 November 2018, the Company announced that, in relation to
press comment regarding a possible sale by Mr Arron Banks ("AB") of
his 29.10% beneficial interest in the Group, it had been informed
by AB that he was exploring options in relation to his beneficial
interest in the MFG Group which could include the disposal of some
or all of these holdings.
Subsequently, as variously announced between September 2019 and
January 2020, AB has reduced his interest so that his remaining
indirect beneficial interest is now 16,966,158 Ordinary Shares held
by Southern Rock Insurance Company Limited ("SRICL"), a company
controlled by AB, which represents 12.94% of the current Issued
Share Capital ("ISC"). In addition to these Ordinary Shares, SRICL
had also made a loan of GBP460,000 to the Company which is due to
be repaid, renewed or converted into 5,111,111 Ordinary Shares on
or before 26 April 2020 (the "SRICL Convertible Loan").
SRICL still wishes to dispose of its Ordinary Shares and
therefore the Board has decided to put forward proposals to
Shareholders to buy back the block of Ordinary Shares currently
held by SRICL (the "Buyback Shares") in order to bring this matter
to a conclusion. This is proposed at a price of approximately
GBP0.095 per share ("Buy-Back Price") for a total consideration of
GBP1,611,785.00 (the "Share Buyback and Mandatory Cancellation" or
"Share Buyback"). This sum shall be left outstanding as a loan on
the terms of a loan agreement to be entered into by MFG and SRICL
(the "Loan Agreement"). Upon completion of the Share Buyback, (i)
the Buyback Shares shall be automatically cancelled by operation of
Isle of Man law as explained in paragraph 6 of Part II of this
document and (ii) John Banks, a current Non-Executive Director of
the Company, will resign as a director.
Since the terms of the buyback were negotiated and in principle
agreed several weeks ago, Shareholders will be aware that there has
been a significant drop in the price of the Company's Ordinary
Shares on AIM in line with the collapse of market sentiment
generally. However, the Buyback Independent Directors remain of the
view that that this does not detract from the fundamental benefits
of the Buyback which resolves the longstanding shareholding issue
at a price substantially below NAV and in a way which ensures no
immediate outflow of cash from the Company. The removal of the
stock overhang is in their view now even more imperative in the
light of the current market conditions. For that reason, they
continue to believe that the Buyback is fair and reasonable and in
the best interest of the Company and its Shareholders.
Further details regarding the consideration of the Buyback
Independent Directors and the Company's Nominated Adviser are
detailed at paragraph 5 of this document, and the recommendation of
the Buyback Independent Directors that shareholders vote in favour
of the Share Buy-Back is set out at paragraph 9 below.
Concurrent with completion of the Share Buyback and Mandatory
Cancellation, it is proposed that the terms applicable to the SRICL
Convertible Loan will be varied pursuant to which: (i) the terms
applicable to the SRICL Convertible Loan shall be amended such that
the SRICL Convertible Loan will be subject to the terms of the Loan
Agreement (which shall contain no ability to convert the amounts
outstanding into Ordinary Shares), and (ii) the principal amount
outstanding in respect of the SRICL Convertible Loan shall be
increased by GBP25,300 to account for the reduction of the interest
rate applicable to the SRICL Convertible Loan. By these means, the
maximum amount of regulatory capital will be retained within the
Group and thus be available to help fund the future growth for the
benefit of the remaining Shareholders.
As at the date of this document, the Company has an ISC of
131,096,235 Ordinary Shares. The Company has secured an irrevocable
undertaking from SRICL not to sell further shares until the
transaction is either satisfied or falls away. Upon completion of
the Share Buyback and Mandatory Cancellation, the Buyback Shares
will be cancelled as required by the Isle of Man Companies Act
2006, and the issued share capital shall then comprise of
114,130,077 Ordinary Shares (the "Post Buyback ISC"). Accordingly,
every other Shareholder's percentage share of the Company will
increase by approximately 14.86%. In particular, the Share Buyback
will have the following effect on the significant shareholders of
the Company:
The below table sets out the position of the Shareholders who
have a declared holding of 3% and over in the Company should the
Share Buyback and Mandatory Cancellation be completed (including
the SRICL Ordinary Shares to be issued):
Name Holding % of Shareholding % of
immediately ISC following Post
prior to the Share Buyback
the Share Buyback ISC
Buyback and and Mandatory
Mandatory Cancellation
Cancellation
James Mellon* 21,492,232
-------------- -------- --------------- ---------
Gregory Bailey*** 17,835,750
-------------- -------- --------------- ---------
Concert Party 39,327,982 29.99% 39,327,982 34.46%
-------------- -------- --------------- ---------
SRICL** 16,966,158 12.94% 0 0.00%
-------------- -------- --------------- ---------
Aeternitas Investments
plc 13,109,623 9.99% 13,109,623 11.49%
-------------- -------- --------------- ---------
Lynchwood Nominees
Limited 9,673,385 7.38% 9,673,385 8.48%
-------------- -------- --------------- ---------
Island Farms Limited 4,222,319 3.22% 4,222,319 3.70%
-------------- -------- --------------- ---------
Rock (Nominees)
Limited 3,955,868 3.02% 3,955,868 3.47%
-------------- -------- --------------- ---------
Others 43,840,900 33.44% 43,840,900 38.41%
-------------- -------- --------------- ---------
Total current ISC 131,096,235 100.00% 114,130,077 100.00%
----------- -------------- -------- --------------- ---------
* Burnbrae holds 19,164,250 Ordinary Shares. Burnbrae is 100%
beneficially owned by James Mellon. Denham Eke, CEO of MFG, is also
a director of Burnbrae. Pershing Nominees Limited holds 166,666
Ordinary Shares and Vidacos Nominees Limited holds 1,468,666
Ordinary Shares in trust for James Mellon and 692,650 Ordinary
Shares are held in his own name.
** Arron Banks, a former Director of MFG, is beneficially
interested in 16,966,158 Ordinary Shares. These shares are held by
Rene Nominees (IOM) Limited in trust for Southern Rock Insurance
Company Limited ("SRICL"). John Banks, a director of MFG, is also a
director of SRICL.
*** Vidacos Nominees Limited holds 17,835,750 Ordinary Shares in
trust for Gregory Bailey.
Completion of the Share Buyback and Mandatory Cancellation would
result in the Concert Party being obliged under Rule 9 of the
Takeover Code to make an offer for the remaining Ordinary Shares
then in issue and not already owned by them (further details in
relation to this are set out in paragraph 3 of this Part I below).
The Panel has agreed, subject to the approval by Whitewash
Independent Shareholders voting on a poll on the Whitewash
Resolution to be proposed at the Extraordinary General Meeting, to
waive this obligation in the event that the Concert Party's
aggregate holding of 39,327,982 Ordinary Shares increases to a
maximum of approximately 34.46%, provided that any increase in such
holding arises only as a result of the Company purchasing and
cancelling the Buyback Shares. No member of the Concert Party or
SRICL will be entitled to vote on the Whitewash Resolution and
accordingly no member of the Concert Party or SRICL will do so.
Further, Conister has a licence condition, imposed by the IOM FSA,
that no single shareholder or "concert-party" may hold 30% or over
of the Company's shares. The IOM FSA has confirmed to the Company
that it consents to waive the licence condition in respect of the
Concert Party's shareholding on the condition that the Buyback
Independent Shareholders approve the terms of the Share
Buyback.
In light of the requirements of the IOM FSA and the Panel,
completion of the Share Buyback and Mandatory Cancellation is
subject to the condition that the Buyback Resolution and the
Whitewash Resolution be passed at the Company's Extraordinary
General Meeting to be held on 9 April 2020 at 11.00a.m. It is
expected that completion of the Share Buyback and Mandatory
Cancellation will take place immediately following the passing of
the Buyback Resolution and Whitewash Resolution.
2. Waiver of Obligations under The Takeover Code and other Regulatory Consents
The Share Buyback and Mandatory Cancellation gives rise to
certain considerations under the Takeover Code. Brief details of
the Panel, the Takeover Code and the protections they afford are
set out below.
The Takeover Code is issued and administered by the Panel. The
Takeover Code governs, inter alia, transactions which may result in
a change of control of a company to which the Takeover Code
applies. The Company is such a company and its Shareholders are
entitled to the protections afforded by the Takeover Code.
Under Rule 9 of the Takeover Code ("Rule 9"), where any person
acquires, whether by a single transaction or a series of
transactions over a period of time, interests in securities which
(taken together with securities in which he is already interested
and in which persons acting in concert with him are interested)
carry 30% or more of the voting rights of a company which is
subject to the Takeover Code, that person is normally required by
the Panel to make a general offer to all the remaining shareholders
of that company to acquire their shares. Rule 9 of the Takeover
Code further provides that where any person, together with persons
acting in concert with him, is interested in shares which in
aggregate carry not less than 30% of the voting rights of a company
but does not hold shares carrying more than 50% of such voting
rights and such person, or any such persons acting in concert with
him, acquires an interest in any other shares which increases the
percentage of shares carrying voting rights in which he is
interested, such person or persons acting in concert with him will
normally be required to make a general offer to all remaining
shareholders to acquire their shares. An offer under Rule 9 must be
made in cash and at the highest price paid by the person required
to make the offer, or any person acting in concert with him, for
any interest in shares of the company during the 12 months prior to
the announcement of the offer.
Under Rule 37 of the Takeover Code, any increase in the
percentage of shares carrying voting rights held by a shareholder
or persons acting in concert with the shareholder resulting from
the purchase by the company of its own shares will be treated as an
acquisition for the purpose of Rule 9. For the purposes of the
Takeover Code, James Mellon and Gregory Bailey, along with their
Connected Persons, full details of whom are set out in paragraph
2.2 of Part II of this document, form the Concert Party. As the
Concert Party is currently beneficially interested in 39,327,982
Ordinary Shares, representing approximately 29.99% of the Issued
Share Capital and the members of the Concert Party have previously
been and are regarded by the Panel to be acting in concert, the
proposed Share Buyback would result in the Concert Party being
obliged under Rule 9 of the Takeover Code to make an offer for the
remaining Ordinary Shares then in issue and not already owned by
them. If 16,966,158 of the Ordinary Shares in issue immediately
prior to the Share Buyback and Mandatory Cancellation (being the
Buyback Shares) were to be purchased by the Company and
subsequently cancelled, the Concert Party's aggregate holding, and
maximum interest, would increase to approximately 34.46% of the
Post-Buyback ISC.
The Panel has agreed, subject to the approval by the Whitewash
Independent Shareholders voting on a poll on the Whitewash
Resolution to be proposed at the Extraordinary General Meeting, to
waive this obligation in the event that the Concert Party's
aggregate holding of 39,327,982 Ordinary Shares increases to a
maximum of approximately 34.46%, provided that any increase in such
holding arises only as a result of the Company purchasing and
cancelling the Buyback Shares. No member of the Concert Party or
SRICL will be entitled to vote on the Whitewash Resolution and
accordingly no member of the Concert Party or SRICL will do so.
Following the repurchase and cancellation of Buyback Shares, the
Concert Party will between them be interested in Ordinary Shares
carrying 30% or more of the Company's voting share capital but will
not hold Ordinary Shares carrying more than 50% of such voting
rights and as long as they continue to be treated as acting in
concert any further increase in that aggregate interest in Ordinary
Shares will be subject to the provisions of Rule 9 of the Takeover
Code.
In addition to the obligations under Rule 9 of the takeover
Code, Conister has a licence condition, imposed by the IOM FSA,
that no single shareholder or "concert-party" may hold 30% or over
of MFG's shares (the "Licence Condition"). Upon completion of the
Share Buyback and the cancellation of the Buyback Shares, the
Concert Party's combined shareholding shall increase to 34.46% of
the ISC. The IOM FSA has confirmed to the Company that it consents
to waive the licence condition in respect of the Concert Party's
shareholding on the condition that the Buyback Independent
Shareholders approve the terms of the Share Buyback and Mandatory
Cancellation.
In the event that the Whitewash Resolution is approved by
Whitewash Independent Shareholders at the Extraordinary General
Meeting, the Concert Party will not be restricted from making an
offer for the Company in the future.
James Mellon and Burnbrae have convertible loans outstanding to
the Company as described in paragraphs 4.1 and 4.3 of Part II of
this Document. In respect of the JM Convertible Loan Agreement, on
conversion in full, this would result in the issue of 13,888,889
Ordinary Shares. In respect of the Burnbrae Convertible Loan
Agreement, on conversion in full, this would result in the issue of
22,666,667 Ordinary Shares. This would result in the Concert
Party's shareholding increasing to 75,883,538 Ordinary Shares.
However, it is important to note that neither James Mellon nor
Burnbrae are seeking to exercise either the JM Convertible Loan
Agreement or the Burnbrae Convertible Loan Agreement. The JM
Convertible Loan Agreement, as set out in paragraph 4.1 of Part II,
requires that a conversion can only be exercised where either: (i)
the conversion does not result in the Concert Party holding more
than 29.99% of the ISC; or (ii) may otherwise trigger a obligation
for the Concert Party to make a general offer under Rule 9 of the
Takeover Code. The Burnbrae Convertible Loan Agreement, as further
set out in paragraph 4.3 of Part II, requires that such conversion
cannot result in the Concert Party holding 30% or more in the
Company as directed by the IOM FSA. Accordingly, any issue of
Ordinary Shares to the Concert Party cannot result in any increase
in its beneficial interest in the Company beyond 29.99% without
both the Panel and the Company's Whitewash Independent Shareholders
agreeing to a waiver of the Concert Party's obligations under Rule
9 and IOM FSA consent and, as a result, have not been included in
the waiver or Whitewash Resolution.
3. The Concert Party
The Concert Party consists of James Mellon and Gregory Bailey,
along with their Connected Persons, full details of which are given
in Part II of this document.
4. Summary of the Share Buyback Documents
Share Buyback Agreement
The Company and SRICL have entered into the Share Buyback
Agreement, pursuant to which SRICL has agreed to sell to the
Company the Buyback Shares. The consideration payable in relation
to the acquisition of the Buyback Shares is GBP1,611,785.00 which
shall be left outstanding as a loan on the terms of the Loan
Agreement. Completion of the Share Buyback and Mandatory
Cancellation is subject to the condition that the Resolutions be
passed at the EGM. The conditions under the Share Buyback Agreement
are required to be satisfied by no later than midnight on 26 April
2020. Under the Share Buyback Agreement, SRICL has provided basic
title and capacity warranties to the Company. It is a term of the
Share Buyback Agreement that John Banks, a current Non-Executive
Director of the Company, will resign as a director.
Loan Agreement
Upon completion of the Share Buyback Agreement, the Company
shall enter into the Loan Agreement with SRICL. Pursuant to the
Loan Agreement, the consideration payable pursuant to the Share
Buyback Agreement shall remain outstanding as a loan to the Company
and shall accrue interest at the rate of 5.4% per annum which will
be paid quarterly. The aggregate principal amount which will be
outstanding pursuant to the Loan Agreement will be GBP2,097,085.00
comprising of amounts due to SRICL pursuant to the Share Buyback
Agreement and also amounts outstanding pursuant to the SRICL Loan
(as amended by the letter of agreement summarised below). This is
repayable after a 5-year term, but the Company shall be entitled to
voluntarily prepay the Loan at any time in that period.
Letter of agreement relating to the SRICL Loan
Upon completion of the Share Buyback Agreement, the Company and
SRICL shall enter into a letter of agreement pursuant to which the
terms applicable to the SRICL Convertible Loan will be varied such
that: (i) the terms applicable to the SRICL Convertible Loan shall
be amended such that the SRICL Convertible Loan will be subject to
the terms of the Loan Agreement (which shall contain no ability to
convert the amounts outstanding into Ordinary Shares), and (ii) the
principal amount outstanding in respect of the SRICL Convertible
Loan shall be increased by GBP25,300 to GBP485,300 to account for
the reduction of the interest rate applicable to the SRICL
Convertible Loan.
5. Related Party Transaction
As SRICL is interested in greater than 10% of the Company's
issued shares, the Share Buyback and Mandatory Cancellation is a
related party transaction under Rule 13 of the AIM Rules. John
Banks, a non-executive director of the Company, is also a
non-executive director of SRICL. The Buyback Independent Directors,
having consulted with the Company's Nominated Adviser, Beaumont
Cornish, consider that the terms of the Share Buyback are fair and
reasonable insofar as Shareholders are concerned.
In particular, the Buyback Independent Directors have considered
the following:
1. The benefit of removing the "overhang" of shares which may be
depressing the Company's share price.
2. The benefit of ensuring that the shares held by SRICL are
disposed of in such a way as to ensure compliance with regulatory
requirements and in an orderly manner so as to avoid a considerable
volume of shares being sold in the market far in excess of normal
daily volumes of trades.
3. The preservation of capital resources within the Group.
4. The Buy-Back price (approximately 9.50 pence) represents a
31.03% premium to the current share price (7.25 pence) and a
discount of 40% to net asset value per share as per the 2019
Interim Results announced on 26 September 2019 (16 pence).
5. Despite the current market volatility caused by the COVID-19
pandemic, the rationale for the Share Buy-Back remains valid.
6. Extraordinary General Meeting
You will find set out at the end of this document a notice
convening the Extraordinary General Meeting to be held at the
Claremont Hotel, Loch Promenade, Douglas, Isle of Man IM1 2LX at
11.00 a.m. on 9 April 2020.
Resolution 1
The Buyback Resolution to be proposed at the EGM is an ordinary
resolution, to be taken on a vote of the Buyback Independent
Shareholders, to approve the terms of the Share Buyback. SRICL will
not vote on the Buyback Resolution.
Resolution 2
The Whitewash Resolution to be proposed at the EGM is an
ordinary resolution, to be taken on a poll of Whitewash Independent
Shareholders, to approve the waiver by the Panel on Takeovers and
Mergers of any requirement under Rule 9 of the Takeover Code for
the Concert Party to make a general offer to Shareholders of the
Company to acquire their Ordinary Shares in the Company arising as
a result of the purchase by the Company of up to 16,966,158
Ordinary Shares in the capital of the Company pursuant to the Share
Buyback and cancellation of the Buyback Shares, which would have
the effect of increasing the Concert Party's aggregate interest to
approximately 34.46% of the voting rights of the Company. No
members of the Concert Party or SRICL will vote on the Whitewash
Resolution.
Resolution 1 is conditional on the approval of Resolution 2.
The Company has received an irrevocable written voting
undertaking from the beneficial interests of James Mellon and Greg
Bailey, shareholder of the Company interested in 29.99% of the
ISC.
Furthermore, the Company has received an irrevocable undertaking
from Aeternitas Investments plc to vote in favour of the
Resolutions in respect of its shareholding of 13,109,623 Ordinary
Shares representing 9.9% of the Company's ISC.
7. Action to be taken
Shareholders will find enclosed with this document a Form of
Proxy for use in connection with the Extraordinary General Meeting.
The Form of Proxy should be completed and returned in accordance
with the instructions thereon so as to be received by the Company's
Registrar, Computershare Investor Services (Jersey) Limited, c/o
The Pavilions, Bridgwater Road, Bristol, BS99 6ZY not later than
11.00 a.m. on 7 April 2020 as soon as possible and in any event not
later than 48 hours before the time of the EGM. Completion and
return of the Form of Proxy will not prevent an Independent
Shareholder from attending and voting at the meeting should he/she
so wish.
8. Additional Information
Your attention is drawn to the additional information set out in
Part II of this document. Shareholders are advised to read the
whole of this document and not rely solely on the summary
information presented in this letter.
9. Recommendation
The Buyback Independent Directors, who have been so advised by
Beaumont Cornish, believe the Buyback Resolution to be fair and
reasonable and to be in the best interests of all Shareholders and
the Company as a whole. In providing advice to the Buyback
Independent Directors, Beaumont Cornish has considered the Buyback
Independent Directors' commercial assessment. The Buyback
Independent Directors unanimously recommend Buyback Independent
Shareholders to vote in favour of the Buyback Resolution as the
Buyback Independent Directors intend so to do in respect of their
beneficial shareholdings amounting to 41,607,385 Ordinary Shares
representing approximately 31.73% of the ISC held by the Buyback
Independent Shareholders.
The Whitewash Independent Directors, who have been so advised by
Beaumont Cornish, believe the Whitewash Resolution to be fair and
reasonable and to be in the best interests of all Shareholders and
the Company as a whole. In providing advice to the Whitewash
Independent Directors, Beaumont Cornish has taken into account the
Whitewash Independent Directors' commercial assessment. The
Whitewash Independent Directors unanimously recommend Whitewash
Independent Shareholders to vote in favour of the Whitewash
Resolution as the Whitewash Independent Directors intend so to do
in respect of their beneficial shareholdings amounting to 2,279,403
Ordinary Shares representing approximately 3.05% of the Enlarged
ISC held by the Whitewash Independent Shareholders.
DEFINITIONS
The following definitions apply throughout this document and the
accompanying Form of Proxy, unless the context requires otherwise
or unless it is otherwise specifically provided:
"Act" Isle of Man Companies Act 2006 (as amended)
"AIM" a market of that name operated by the London
Stock Exchange
"Articles" the memorandum and articles of association
in force as at the date of this document
"Beaumont Cornish" Beaumont Cornish Limited, authorised and regulated
by the Financial Conduct Authority
"Board" the board of Directors of the Company as at
the date of this Circular
"Burnbrae" Burnbrae Limited
"Burnbrae CLA" the convertible loan agreement entered into
by the Company and Burnbrae which was subsequently
assigned in part to James Mellon, further
details of which are set out in paragraph
4.3 of Part II of this document
"Burnbrae Convertible The convertible loan of GBP1,700,000 outstanding
Loan" pursuant to the Burnbrae CLA, of which GBP1,200,000
is outstanding to Burnbrae and GBP500,000
is outstanding to James Mellon
"Business Day" any day (other than a Saturday, Sunday or
a public holiday) on which banks are generally
open in the City of London and Douglas in
the Isle of Man for the transaction of normal
banking business
"Buyback Independent the Board other than John Banks
Directors"
"Buyback Independent Shareholders other than SRICL
Shareholders"
"Buyback Resolution" the ordinary resolution to be proposed to
Buyback Independent Shareholders, to approve
the terms of the Share Buyback
"Buyback Shares" 16,966,158 Ordinary Shares presently held
by SRICL
"Company" or "MFG" Manx Financial Group PLC
"Concert Party" James Mellon and Gregory Bailey, along with
their Connected Persons, being the persons
presumed to be acting in concert as described
in paragraph 2.2 of Part II of this document
"Connected Persons" has the meaning set out in the Takeover Code
and includes a spouse, children under 18 and
any company in which the relevant person is
interested in shares comprising at least one-fifth
of the share capital of that company
"CREST" the relevant system (as defined in the Regulations)
in respect of which Euroclear is the operator
(as defined in the Regulations)
"Directors" or "Board" the directors of the Company whose names are
set out on page 5 of this document
"Eligible Shareholders" in respect of the Buyback Resolution, the
Buyback Independent Shareholders, and in respect
of the Whitewash Resolution, the Whitewash
Independent Shareholders
"Euroclear" Euroclear UK & Ireland Limited, a company
incorporated in England and Wales and the
operator of CREST
"Extraordinary General the extraordinary general meeting of the Company
Meeting" or "EGM" to be held at 11.00 a.m. on 9 April 2020,
notice of which is set out at the end of this
document
"FSMA" the UK Financial Services and Markets Act
2000
"Form(s) of Proxy" the form of proxy enclosed with this document
for use at the EGM
"IOM" the Isle of Man
"IOM FSA" the Isle of Man Financial Services Authority
"Issued Share Capital" the Ordinary Shares in issue as at the date
or "ISC" of this document
"JM CLA" the convertible loan agreement entered into
by the Company and James Mellon, further details
of which are set out in paragraph 4.1 of Part
II of this document
"JM Convertible The convertible loan of GBP1,250,000 outstanding
Loan" and owing by the Company to James Mellon pursuant
to the JM CLA
"Loan Agreement" The conditional loan agreement to be entered
into by the Company and SRICL on the date
upon which the Share Buyback Agreement completes,
further details of which are set out in paragraph
4 of Part I of this document
"London Stock Exchange" London Stock Exchange Plc
"MFG Group" the Company and its subsidiaries
"Official List" the Official List of the UK Listing Authority
"Ordinary Shares" ordinary shares of nil par value each in the
capital of the Company
"Panel" the Panel on Takeovers and Mergers
"Regulations" the Uncertificated Securities Regulations
2001 (SI 2001 No. 01/3755), as amended
"Resolutions" the Buyback Resolution and the Whitewash Resolution
"Share Buyback and the proposed purchase of the Buyback Shares
Mandatory Cancellation" by the Company from SRICL and their immediate
or "Share Buyback" cancellation
"Share Buyback Agreement" the conditional share purchase agreement entered
into by the Company and SRICL on 20 March
2020, further details of which are set out
in paragraph 4 of Part I of this document
"Share Buyback Documents" the Share Buyback Agreement and the Loan Agreement
"Shareholders" holders of Ordinary Shares
"SRICL" Southern Rock Insurance Company Limited
"SRICL CLA" the convertible loan agreement entered into
by the Company and Rock Holdings Limited which
was subsequently assigned to SRICL, further
details of which are set out in paragraph
4.2 of Part II of this document
"SRICL Convertible The convertible loan of GBP460,000 outstanding
Loan" and owing by the Company to SRICL pursuant
to the SRICL CLA
"Takeover Code" The City Code on Takeovers and Mergers, as
amended from time to time
"UK FCA" the UK Financial Conduct Authority
"UK" or "United The United Kingdom of Great Britain and Northern
Kingdom" Ireland
"Whitewash Independent the Board other than James Mellon, Denham
Directors" Eke, Gregory Bailey and John Banks
"Whitewash Independent Shareholders other than the members of the
Shareholders" Concert Party and SRICL
"Whitewash Resolution" the ordinary resolution to be proposed to
Whitewash Independent Shareholders, on a poll
at the Extraordinary General Meeting, to approve
a waiver under Rule 9 of the Takeover Code
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
CIRURSSRRKUOUAR
(END) Dow Jones Newswires
March 20, 2020 11:00 ET (15:00 GMT)
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