Proposed Capital Restructurin

RNS Number : 6152W

Kleenair Systems International PLC

31 July 2009

 

KleenAir Systems International Plc (the “Company”)

 

Proposed Capital Reorganisation

 

31 July 2009

 

The Company announces that following the successful conclusion of the procedures for the Company Voluntary Arrangement as detailed in the Company’s circular posted to its shareholders on 29 May 2009, it is now seeking shareholder approval for the Capital Reorganisation as detailed in a Circular dated and despatched to its shareholders on 29 July 2009. The Circular is available on the Company’s website at www.kleenairsystems.co.uk. All definitions in this announcement bear the same meaning as those set out in the Circular, unless otherwise stated.

The Company’s shares remain suspended from trading on AIM but the Company anticipates being able to apply for the lifting of the suspension in the very near future.

The Board considers that the Capital Reorganisation would make the Ordinary Shares a more attractive investment proposition to potential investors in the Company and would facilitate any future fund raising that may be appropriate to the development of the Company’s ongoing environmental consulting business.

The Board is also seeking Shareholders’ approval at the GM to increase the Company’s Authorised Share Capital, to renew the Directors’ authority to allot shares pursuant to section 80 of the Act and to disapply section 89(1) of the Act and to amend the Company’s Articles of Association.

Summary of the Proposals

Currently, the Authorised Share Capital is £1,000,000 divided into 87,788,000 Ordinary Shares and 12,212,000 B Ordinary Shares. There are currently 27,881,238 Ordinary Shares in issue and 12,212,000 B Ordinary Shares in issue, in each case credited as fully paid up. Up to 406,155 Ordinary Shares may fall to be issued pursuant to the terms of the Company Voluntary Arrangement.

Increase in the Authorised Share Capital

It is proposed that the Authorised Share Capital be increased from the existing £1,000,000 to £1,900,000.

Capital Reorganisation

Under the provisions of section 100 of the Act, the Company may not allot shares at a price which is less than their nominal value of those shares. The closing mid market price of an Ordinary Share as at the close of business on 9 February 2009, the date on which the Company requested the temporary suspension of its shares from being traded on AIM, was 1.25 pence. This is marginally above the nominal value of an Existing Ordinary Share. The Directors consider that it would enable them and the Company to proceed more quickly to appropriate opportunities requiring the issue of additional Ordinary Shares if the Company’s share capital were to be reorganised on the basis of the Capital Reorganisation.

The effect of the Capital Reorganisation will be to consolidate every 100 Existing Ordinary Shares into 1 New Ordinary Share and 1 Deferred Share. It is proposed that the Capital Reorganisation will consist of the following steps:

(i)	following the increase of the Company’s Authorised Share Capital from £1,000,000 to £1,900,000, the Company’s New Authorised Share Capital will be consolidated into Ordinary Shares of nominal value £1 each as a result of the issued Ordinary Shares of 1 penny each and B Ordinary Shares of 1 penny each being consolidated into Ordinary Shares of £1 and B Ordinary Shares of £1, respectively, on the basis of 1 Ordinary Share of £1 for each Ordinary Share of 1 penny;
(ii)	each of the issued Ordinary Shares of nominal value £1 arising by reason of (i) above will then be sub-divided into one New Ordinary Share of 1 penny and one Deferred Share of 99p; and
(ii)	each of the issued B Ordinary Shares of nominal value £1 arising by reason of (i) above will be sub-divided into one New Ordinary B Share of 1 penny each and 1 Deferred Share of 99 pence each.

Any fractions of New Ordinary Shares and New Ordinary B Shares arising from the Capital Reorganisation will be aggregated and sold. A Shareholder shall not, in accordance with the provisions of the Company’s Articles of Association, be entitled to receive any such sale proceeds if the Fractional Entitlement shall be less than £5.

The New Ordinary Shares will replace the Existing Ordinary Shares under the Company’s Articles of Association proposed to be amended pursuant to resolution 5 to be proposed at the GM. The provisions in relation to the Deferred Shares will also be contained in the Company’s Articles of Association as so proposed to be amended.

The Deferred Shares will have very limited rights and are effectively valueless. The Deferred Shares will have no voting rights and will have no rights as to dividends and only very limited rights on a return of capital. They will not be admitted to or listed on any stock exchange and will not be freely transferable. No share certificates will be issued in respect of the Deferred Shares, nor will the CREST accounts of Shareholders be credited in respect of any entitlement to Deferred Shares. It is the Board’s intention, at the appropriate time, to make an application to the Court for the Deferred Shares to be cancelled.

The New Ordinary Shares and New B Ordinary Shares will have the same rights as those currently accruing to the existing respective Ordinary Shares under the Company’s Articles of Association, including those in respect of voting and entitlement to dividends. A Shareholder’s pro rata entitlement to Ordinary Shares will not be affected. The consolidation should not affect the market value of a Shareholder’s aggregate holding of Ordinary Shares.

Once the proposed resolutions have been passed at the General Meeting, the share capital of the Company will comprise:

	Ordinary Shares of 1p each	B Ordinary Shares of 1p each	Deferred shares of 99p each
Authorised	150,185,574	122,120	400,932
Issued	278,812	122,120	400,932

 

Other Resolutions

As part of the Capital Reorganisation, the Company intends to amend its Articles of Association to include provisions in respect of the Deferred Shares and to disapply pre-emption rights and grant authority to Directors to allot New Ordinary Shares under the Act up to an aggregate nominal value of the entire unissued share following the Capital Reorganisation.

The above means that the number of Ordinary Shares available for issue would be 149,906,762.

General Meeting

The Proposals are conditional on the approval of the Shareholders at the GM. The Circular contains a notice convening the GM to be held at the offices of Marriott Harrison at Staple Court, 11 Staple Inn Buildings, London WC1V 7QH on Friday 21 August 2009 at 10.30a.m. At the GM, Resolutions will be proposed to approve:

(i)         the increase in the Company’s Authorised Share Capital;

(ii)        the Capital Reorganisation;

(iii)       the grant of authority under section 80 of the Act to the Directors to allot New Ordinary Shares up to an aggregate nominal value of the entire unissued share capital of the Company, until the next annual general meeting of the Company;

(iv)       the disapplication of pre-emption rights pursuant to section 95 of the Act to enable the Directors to allot New Ordinary Shares up to an aggregate nominal value of the entire unissued share capital of the Company, until the next annual general meeting of the Company; and

(v)        amendments to the Company’s Articles of Association required in connection with the Capital Reorganisation.

The reason why these approvals are being sought now is that the Company is actively considering certain potential opportunities and by enabling the Directors to issue New Ordinary Shares with a nominal value of 1 penny on a non pre-emptive basis, the Directors are of the view that the Company would be able more quickly to conclude any corporate transaction requiring the issue of New Ordinary Shares without further recourse to Shareholders for their approval (save as may be required under the AIM Rules).

Recommendation

The Directors consider that the Proposals are in the best interests of the Company and the Shareholders as a whole and recommend that Shareholders vote in favour of the Resolutions, as they intend to do, or procure to be done, in respect of their interests in Ordinary Shares.

Further enquiries:

 

KleenAir Systems International Plc

Lionel Simons, Chairman and Chief Executive

07799 690 785

www.kleenairsystems.co.uk

 

W.H. Ireland Limited

Tim Cofman-Nicoresti/Katy Birkin

0121 265 6330

 

END

 

 

CARRMMFTMMAJBRL