Acquisition

RNS Number : 5802A

Parkmead Group (The) PLC

12 October 2009

 



NOT FOR DISTRIBUTION IN OR INTO AUSTRALIA, CANADA, JAPAN, THE REPUBLIC OF SOUTH AFRICA, THE REPUBLIC OF IRELAND OR THE UNITED STATES OR ANY OTHER JURISDICTION IF TO DO SO WOULD CONSTITUTE A VIOLATION OF THE LAWS OF SUCH JURISDICTION

THE PARKMEAD GROUP PLC 

("Parkmead" or the "Company")

Acquisition of Aupec Limited

Waiver from Provisions of Rule 9 of the Takeover Code

Capital Reorganisation

Highlights 

• Acquisition of Aupec through the issue of 235.3 million New Ordinary Shares and £1.0 million in cash;

• Aupec is a respected global authority in energy sector economics, valuation and benchmarking and has been providing economic consultancy services to the oil and gas sector for over 20 years;

• The Directors believe that the Acquisition will expedite the Company's stated strategy to be a leading small cap oil and gas investment and advisory house;

• The Directors believe that there are significant synergies that the Enlarged Group can exploit; and

• Each issued Existing Ordinary Share to be sub-divided and re-designated as one New Ordinary Share (having a nominal value of 0.1 pence each) and one Deferred Share (having a nominal value of 4.9 pence).

Niall Doran, Chief Executive Officer of Parkmead Group plc, commented: 

"The acquisition of Aupec is an important step in fulfilling the Company's strategy to become a leading small cap oil and gas investment and advisory house.

The combination gives us a stronger platform and more diverse base upon which to build Parkmead's revenues and income. It further strengthens the high level financial, government, major energy company and technical relationships that we have in the oil and gas industry and comes at a time when demand for energy advisory and consultancy services has increased."

For further information please contact:

The Parkmead Group Plc: Niall Doran CEO Gordon Ashworth CFO 020 7494 5770

Charles Stanley Securities Nominated Adviser and Broker Rick Thompson / Ben Johnston / Carl Holmes 020 7149 6000

Madano Partnership  Financial Public Relations Mathew Moth  0207 593 4000

1.    Introduction

The Directors are pleased to announce, that the Company has conditionally agreed to acquire the entire issued share capital of Aupec through the issue of 235,294,118 New Ordinary Shares and the payment of £1,000,000 in cash. Aupec is an energy consulting business, further details of which are set out below.  

In addition to the Acquisition, the Company wishes to carry out the Capital Reorganisation and the other Proposals set out below. 

2.    Background to and reasons for the Acquisition 

At the end of June 2009, the Company approached Aupec regarding a possible combination of the two businesses. Prior to the Company's approach, the Company had been considering possible participation in a transaction relating to some exciting exploration assets.  Unfortunately, however, although the transaction was well advanced, it did not reach conclusion.  Whilst the team is actively evaluating and pursuing opportunities on the principal asset side, the Directors believe that the Acquisition will expedite the Company's stated strategy to be a leading small cap oil and gas investment and advisory house. Further, the Acquisition represents an opportunity for the Company to:

• acquire a reputable energy advisory and consulting business at a time when demand for such businesses has increased;

• diversify and grow the Company's revenue and income base;

• complement the Company's existing team with Aupec's leading experts in oil and gas econometrics, valuation and benchmarking;

• increase the Company's network of high level financial, government, major energy company and technical relationships in the oil and gas industry, to support the Company's current and future activities, many of which are in emerging markets;

• harness the Company's existing relationship network to cross-sell Aupec's services; and 

• realise synergies with the principal investing arm of the business through accessing Aupec's technical and economic consultancy expertise.

Aupec is a private company which was established in 1986 to commercialise the accumulated skills of members of the University of Aberdeen's Department of Economics. Aupec has since grown into a respected global authority in energy sector economics, valuation and benchmarking and has been providing economic consultancy services to the oil and gas sector for over 20 years. Aupec has built a reputation for delivery of high quality decision support tools and independent consulting advice across the oil, financial and public sectors. 

Aupec's clients include major, independent and national oil companies, oil service companies, government ministries and agencies, as well as financial institutions. Aupec's clients have included the following organisations:

• Government ministries and departments of the following countries:

Angola, Australia, Azerbaijan, Canada, Denmark, Egypt, Falkland Islands, Faroe Islands, Greenland, Kazakhstan, Mozambique, Nepal, New Zealand, Norway, Poland, Russian Federation, Sao Tome & Principe, Tanzania, Thailand, Trinidad & Tobago, the United Kingdom, United States, Uzbekistan.

• The World Bank and The European Commission.

• The following International Oil Companies (IOCs):

BP, Shell, ExxonMobil, Chevron, ConocoPhillips, Total, PetroCanada, Encana, Nexen, Hess Corporation, Devon Energy, Maersk Oil, Marathon, Talisman, Woodside Energy, TNK BP, El Paso, Norsk Hydro, Statoil, Repsol YPF, Rosneft, Anadarko, BHP Billiton, Cepsa, ENI, Halliburton, PSN, Stewart and Stevenson, Suncor, Sunoco, Syncrude, TransAlta.

• The following National Oil Companies (NOCs):

SaudiAramco, Bahrain Petroleum Company (Bapco), Kuwait National Petroleum Co, Kuwait Oil Co, Petronas, Ecopetrol.

The Directors believe that the Enlarged Group will be better positioned to deliver shareholder value in the short, medium and long term. 

In the Report and Accounts for the twelve months ended 31 December 2008, turnover and net profit in Aupec amounted to £2.711 million and £0.639 million, respectively. For the six months ended 31 December 2008, turnover in the Company amounted to £0.099 million. As at 31 December 2008 Aupec reported net assets of £1.337 million including £3.058 million of cash and no debt. As at 31 December 2008 the Company had £7.244 million of net assets including £3.846 million of cash and no debt. The Directors expect the Enlarged Group's trading prospects and balance sheet to be strengthened through the Acquisition.

The Directors and the Concert Party intend that Aupec will continue to be run as an independent entity within the Enlarged Group.

The Directors of the Company are of the belief that the combination with Aupec will expedite the Company's development by allowing the Company to offer a wider array of services to customers and thereby to win larger contracts.

3.    Terms of the Acquisition

Pursuant to the terms of the Acquisition Agreement, the Company has conditionally agreed to acquire from the Vendors (two of which are Thomas Cross, a non-executive director of the Company and his wife Linda Cross) the entire issued share capital of Aupec through the payment of £1,000,000 in cash and the issue to the Vendors of 235,294,118 New Ordinary Shares which will represent 38.98 per cent. of the Enlarged Ordinary Share Capital. The Acquisition Agreement is conditional on, amongst other things, the Resolutions being passed at the General Meeting.  

In determining the number of Acquisition Shares to be issued and therefore the relative valuation of Aupec and the Company, the Independent Directors have taken into consideration the current trading and prospects of both the Company and Aupec, the expected relative financial contributions of the two companies and the benefits that Aupec will bring to the overall operations of the Enlarged Group.

Application will be made to the London Stock Exchange for the Acquisition Shares to be admitted to trading to AIM. It is expected that such admission will occur on 3 November 2009. The Acquisition Shares will, when issued, rank equally in all respects with the other New Ordinary Shares in issue including the right to receive dividends and other distributions declared. 

4.    Current trading and future prospects

As reported within the Company's interim results for the period ending 31 December 2008, as announced on 31 March 2009, the unprecedented turmoil in global financial, equity and commodity markets has had a marked effect on the Company's investments. For the year ended 30 June 2009, the Company's management accounts report significantly higher operating expenses as result of the Company incurring one-off corporate transaction related expenses and impairment of the Company's investments resulting from the turbulence in equity markets during the year. However, the Directors are particularly encouraged by the recent share price appreciation of Faroe Petroleum plc, in which the Company holds 2,918,724 ordinary shares.

The Directors believe that there are significant synergies that the Enlarged Group can exploit. Aupec's economic and technical expertise will be used in the Company's investment appraisal process. Additionally, the Company will look to on sell Aupec services across its wider networks. Finally, the Directors believe that there may be limited cost-saving synergies available to the Enlarged Group, and they will consider these where appropriate. In particular, they will consider whether savings can be derived from the consolidation of the back office and head office of the Enlarged Group.  

5.    Lock in arrangements

The Acquisition Agreement contains lock in undertakings given by Thomas Cross, Linda Cross, David Rose and Alexander Kemp (each of whom will hold three per cent. or more of the Enlarged Ordinary Share Capital following Completion). Under these lock in provisions, each of Thomas Cross, Linda Cross, David Rose and Alexander Kemp undertakes (subject to certain limited exceptions, including transfers to family members or to trustees for their benefit, disposals with the prior consent of the Directors and disposals by way of acceptance of a takeover offer for the entire issued share capital of the Company) not to dispose of any shares in the Company (or any interest in them or in respect of them) held by him or her following admission of the New Ordinary Shares to trading on AIM at any time prior to the first anniversary of such admission. In addition, Niall Doran (the only Director who will hold three per cent. or more of the Enlarged Ordinary Share Capital following Completion) will give a lock in undertaking on similar terms to those given by Thomas Cross, Linda Cross, David Rose and Alexander Kemp.

6.    Rule 9 of the Takeover Code

The Code governs, amongst other things, transactions which may result in a change of control of a public company to which the Code applies. Under Rule 9, where any person acquires an interest (as such term is defined in the Code) in shares which, taken together with shares in which he is already interested and in which persons acting in concert with him are interested, carry 30 per cent. or more of the voting rights of a company which is subject to the Code, such person or group is normally required to make a general offer to all the remaining shareholders to acquire their shares.

Similarly, when any person together with persons acting in concert with him is interested in shares which, in the aggregate, carry not less than 30 per cent. of the voting rights of such a company but does not hold shares carrying more than 50 per cent. of such voting rights, a general offer will normally be required if any further interests in shares are acquired by any such person.

An offer under Rule 9 must be in cash and at the highest price paid during the preceding 12 months for any interest in shares of the Company by the person required to make the offer or any person acting in concert with him. 

Persons acting in concert comprise persons who, pursuant to an agreement or understanding (whether formal or informal), actively co-operate to obtain or consolidate control of or frustrate the successful outcome of an offer for the Company.

For the purposes of the Code, all of the Vendors are deemed to be acting in concert, and their interests are to be aggregated. 

Assuming that the Resolutions are duly passed and the Acquisition Shares are issued under the terms of the Acquisition Agreement (and assuming also that no options or other rights to subscribe for shares of the Company are exercised between the date of this document and Completion), the Concert Party will hold, in aggregate, 249,294,118 New Ordinary Shares, representing approximately 41.29 per cent. of the Company's issued ordinary share capital, of which Thomas Cross will hold in his private capacity (and including Linda Cross's shareholding) 169,761,525 New Ordinary Shares representing approximately 28.12 per cent. of the Company's issued ordinary share capital.  

Following completion of the Proposals, the members of the Concert Party will between them be interested in shares carrying 30 per cent. or more of the Company's voting share capital but will not hold shares carrying more than 50 per cent. of such voting rights and (for so long as they continue to be treated as acting in concert) any further increase in that aggregate interest in shares will be subject to the provisions of Rule 9.

In the absence of a waiver granted by the Panel, Rule 9 would require the Concert Party to make a general offer for the balance of the New Ordinary Shares in issue immediately following the Acquisition. The Panel has been consulted and has agreed, subject to the passing on a poll by the Independent Shareholders of the Whitewash Resolution, to waive the obligation on the Concert Party that would otherwise arise under Rule 9, as a result of the issue of the Acquisition Shares pursuant to the Acquisition, for a general offer to be made by the Concert Party for the balance of the issued New Ordinary Shares not already held by the Concert Party. 

7.    Capital Reorganisation

Background

The Existing Ordinary Shares have a nominal value of 5 pence each. The closing mid market price of the Existing Ordinary Shares on the last day of trading prior to posting this document was 1.475 pence per share which is less than the nominal value of such shares.  The 2006 Act provides that a company may not lawfully issue a share for a subscription price which is less than its nominal value.  

Accordingly, the Company has found itself in a position where it is unable to use its Existing Ordinary Shares to pursue acquisitions or raise further equity for expansion. This is reflected in the terms of the Acquisition, where one of the conditions to Completion is that the share capital of the Company is re-organised, as described below.

In these circumstances, the Directors have determined that it is in the best interest of Shareholders as a whole to remove this barrier to acquisition led growth and the raising of further equity for expansion.  

Capital Re-organisation

In order to lower the nominal value of the Company's shares without changing Shareholders' economic or voting rights, the Company proposes that each issued Existing Ordinary Share be sub-divided and re-designated as one New Ordinary Share (having a nominal value of 0.1 pence) and one Deferred Share (having a nominal value of 4.9 pence). It is proposed that each authorised but unissued Existing Ordinary Share be sub-divided and re-designated as fifty New Ordinary Shares.

The proposed Capital Reorganisation will not affect the rights attaching to the Existing Ordinary Shares, other than to alter their nominal value. The issued New Ordinary Shares will trade on AIM and, without taking account of the Acquisition Shares, will be identical in number to the issued Existing Ordinary Shares.  

Deferred Shares

The Deferred Shares will have no practical economic value, will not be transferrable, will not be admitted to AIM or any other market, will be non-voting, will carry no right to a dividend or other distribution or to participate in any way in the income or profits of the Company, will carry no right to receive notice or attend, speak or vote at any general meeting of the Company. The Deferred Shares will have no right to participate in the assets of the Company save that on the return of assets in a winding up, the holders of such Deferred Shares would be entitled only to the repayment of the amount that is paid up on such shares after (i) repayment of the capital paid up on the ordinary share capital and (ii) the payment of £1,000,000 on each such ordinary share in the capital of the Company. The Deferred Shares will be subject to eventual transfer or cancellation by or at the direction of the Company for no payment.  

It is proposed that the rights and restrictions attaching to the Deferred Shares will be inserted into the Articles by amendments to the Articles. These amendments and the other mechanics required to give effect to the Capital Reorganisation are proposed as a special resolution of the Shareholders. The Capital Reorganisation is not conditional upon the Whitewash or the Acquisition, generally.

Effect of the Capital Reorganisation

On the passing of the relevant Resolution, a holder of one Existing Ordinary Share would as a result hold one New Ordinary Share and one Deferred Share. The Company does not propose to issue new share certificates in respect of the New Ordinary Shares, as the number of Ordinary Shares held will be identical. Existing share certificates will continue to be valid. New share certificates will, however, be sent out in relation to trades or transfers of certificated New Ordinary Shares effected on or after the close of business on 2 November 2009. 

Certificates will not be issued to the Shareholders for the Deferred Shares.  

8.    Related party transaction 

Thomas Cross, a non-executive director of the Company is the current holder of 12,000,000 Existing Ordinary Shares, representing 3.26 per cent. of the Existing Share Capital. Thomas Cross's current family holding for the purpose of the AIM Rules is 14,000,000 Existing Ordinary Shares, or 3.80 per cent. of the Existing Share Capital. Thomas Cross is considered to be a related party as defined under the AIM Rules.

Pursuant to the terms of the Acquisition Agreement, immediately following Completion Thomas Cross would hold 85,414,701 New Ordinary Shares representing approximately 14.15 per cent. of the Enlarged Share Capital and of the voting rights attaching to such capital and his wife, Linda Cross, would hold 84,346,824 New Ordinary Shares representing approximately 13.97 per cent. of the Enlarged Share Capital and of the voting rights attaching to such capital. In aggregate, Thomas Cross and Linda Cross would be issued 155,761,525 New Ordinary Shares representing approximately 25.80 per cent. of the Enlarged Share Capital and of the voting rights attaching to such capital. This means that in aggregate, following Completion, they would hold 169,761,525 New Ordinary Shares representing approximately 28.12 per cent. of the Enlarged Share Capital and of the voting rights attaching to such capital. The Acquisition is considered to be a related party transaction for the purposes of AIM Rule 13, and the Independent Directors, having consulted with Charles Stanley, the Company's nominated adviser, consider the terms of the Acquisition to be fair and reasonable insofar as the Company's Shareholders, including the Independent Shareholders, are concerned.  

9.    Substantial property transaction 

Under section 190(1) of the 2006 Act, a company may not enter into an arrangement under which the company acquires or is to acquire a substantial non-cash asset (directly or indirectly) from a director of the company, or a person connected with such a director, unless the arrangement has been approved by a resolution of the members of the company or is conditional on such approval being obtained.

As stated above, Completion of the Acquisition would result in the Company acquiring 66.2 per cent. of the share capital of Aupec from Thomas Cross and his wife, Linda Cross. The Directors are of the opinion that the shares in Aupec to be transferred by Thomas and Linda Cross would be a substantial non-cash asset for the purposes of section 190(1). Accordingly, the Acquisition Agreement is conditional upon Shareholder consent to the substantial property transaction being obtained.

10.    General Meeting

The General Meeting is being convened to be held at the offices of Kemp Little LLP, Cheapside House, 138 Cheapside, London EC2V 6BJ on 2 November 2009 at 9.30 a.m. at which the Resolutions described below will be proposed for the purposes of, amongst other things, implementing the Acquisition and the Capital Reorganisation. 

11.    Irrevocable undertakings 

Irrevocable undertakings from the Independent Shareholders

The Company has received irrevocable undertakings ("Independent Undertakings") from the Independent Shareholders listed below (including each of the Independent Directors who holds Shares), holding in aggregate 141,938,244 Existing Ordinary Shares, representing approximately 38.54 per cent. of the Existing Share Capital. Pursuant to the Independent Undertakings, each such Independent Shareholder confirms that he is the absolute beneficial owner of the Existing Ordinary Shares set out in the table below, or else that he has the authority to direct the voting rights in respect of such Existing Ordinary Shares. In addition, each Independent Shareholder has undertaken: (a) to vote in favour of the Resolutions, provided that the Resolutions are substantially in the form set out in the Notice and the description of the consideration for the Acquisition is, in all material respects, as set out in the Circular; (b) not to sell, transfer or otherwise dispose of any of the Existing Ordinary Shares which he holds at the date of signing the relevant Independent Undertaking, or any interest in such Existing Ordinary Shares prior to such time as the vote upon each of the Resolutions has been taken or the proposal to put the Resolutions has been abandoned; and (c) not to base any behaviour in relation to the securities of the Company or any qualifying investments or relevant products (as defined in the Financial Services and Markets Act 2000 ("FSMA") and in the Code of Market Conduct made pursuant to FSMA), which would amount to market abuse for the purposes of FSMA, on such information. In addition, pursuant to the Independent Undertakings, each Independent Shareholder consents to the statement in this document that he has given the relevant Independent Undertaking.  

Each Independent Undertaking will cease to be binding on the date which is three months from the date of such undertaking. The expiry date of each Independent Undertaking is set out in the table below.  

Identity of person from whom the Independent Undertaking has been procured	Company in respect of which Independent Undertaking is given	Number and class of securities to which the Independent Undertaking relates	Percentage of Existing Share Capital (%)	Date of Independent Undertaking	Expiry date of Independent Undertaking
David Mills	The Parkmead Group plc	63,146,567 Existing Ordinary Shares	17.14	23.09.09	23.12.09
Trustees on behalf of a trust in which Colin Goodall has an interest	The Parkmead Group plc	12,000,000 Existing Ordinary Shares	3.26	16.09.09	16.12.09
Niall Doran	The Parkmead Group plc	35,491,677 Existing Ordinary Shares	9.64	10.09.09	10.12.09
Gordon Ashworth	The Parkmead Group plc	200,000 Existing Ordinary Shares	0.05	10.09.09	10.12.09
John Leggate	The Parkmead Group plc	800,000 Existing Ordinary Shares	0.22	23.09.09	23.12.09
Nightwish Investments Limited	The Parkmead Group plc	30,300,000 Existing Ordinary Shares	8.23	10.09.09	10.12.09
TOTAL		141,938,244 Existing Ordinary Shares	38.54

Accordingly, the Company has received irrevocable undertakings or letters of intent from Independent Shareholders to vote in favour of the Resolutions (including the Whitewash Resolution) in respect of, in aggregate, 141,938,244 Existing Ordinary Shares representing approximately 38.54 per cent. of the Existing Share Capital.

Irrevocable undertakings from Thomas Cross and Linda Cross

The Company has also received irrevocable undertakings ("Additional Undertakings") from Thomas Cross and Linda Cross, holding in aggregate 14,000,000 Existing Ordinary Shares, representing approximately 3.80 per cent. of the Existing Share Capital. Pursuant to the Additional Undertakings, each of Thomas Cross and Linda Cross confirms that he or she is the absolute beneficial owner of the Existing Ordinary Shares set out in the table below, or else that he or share has the authority to direct the voting rights in respect of such Existing Ordinary Shares. In addition, each of Thomas Cross and Linda Cross has undertaken: (a) to vote in favour of the Resolutions other than the Whitewash Resolution, provided that such Resolutions are substantially in the form set out in the Notice and the description of the consideration for the Acquisition is, in all material respects, as set out in the Circular; (b) not to sell, transfer or otherwise dispose of any of the Existing Ordinary Shares which he or she holds at the date of signing the relevant Independent Undertaking, or any interest in such Existing Ordinary Shares prior to such time as the vote upon each of the Resolutions has been taken or the proposal to put the Resolutions has been abandoned; and (c) not to base any behaviour in relation to the securities of the Company or any qualifying investments or relevant products (as defined in the Financial Services and Markets Act 2000 ("FSMA") and in the Code of Market Conduct made pursuant to FSMA), which would amount to market abuse for the purposes of FSMA, on such information. In addition, pursuant to the Additional Undertakings, each of Thomas Cross and Linda Cross consents to the statement in this document that he or she has given the relevant Additional Undertaking.  

Each Additional Undertaking will cease to be binding on the date which is three months from the date of such undertaking. The expiry date of each Additional Undertaking is set out in the table below.  

Identity of person from whom the Additional Undertakings has been procured	Company in respect of which Additional Undertakings is given	Number and class of securities to which the Additional Undertakings relates	Percentage of Existing Share Capital (%)	Date of Additional Undertakings
Thomas Cross	The Parkmead Group plc	12,000,000 Existing Ordinary Shares	3.26	10.09.09
Linda Cross	The Parkmead Group plc	2,000,000 Existing Ordinary Shares	0.54	10.09.09
TOTAL		14,000,000 Existing Ordinary Shares	3.80

Accordingly the Company has received irrevocable undertakings from Shareholders to vote in favour of the Resolutions, other than the Whitewash Resolution, in respect of, in aggregate, 155,938,244 Existing Ordinary Shares representing approximately 42.34 per cent. of the Existing Share Capital.

12.    Circular

A circular has today been posted to Shareholders providing details of all matters relating to the Acquisition, the Capital Reorganisation and the other Proposals and is available on the Company's website www.parkmeadgroup.com. 

EXPECTED TIMETABLE OF EVENTS

Publication of the circular, including the Notice	12 October 2009
Latest time and date for receipt of Forms of Proxy for the General Meeting	9.30 a.m. on 31 October 2009
General Meeting	9.30 a.m. on 2 November 2009
Record Date for the Capital Reorganisation	6.00 p.m. on 2 November 2009
Dealings in New Ordinary Shares commence on AIM	8 a.m. on 3 November 2009
Dealings of Acquisition Shares commence on AIM	8 a.m. on 3 November 2009
Completion of the Acquisition	3 November 2009
New Ordinary Share certificates dispatched to Vendors by	13 November 2009
Note:    If any of the above times or dates should change, the revised times and/or dates will be notified to Shareholders by an announcement on a Regulatory Information Service. All events listed in the above timetable following the General Meeting are conditional on the passing of the Resolutions contained in the Notice at the General Meeting   References to time in this document are to London time.

DEFINITIONS

The following definitions apply throughout this document, unless the context requires otherwise:

“2006 Act”	the Companies Act 2006 (as amended)
“Acquisition”	the proposed acquisition by the Company of the entire issued share capital of Aupec pursuant to the Acquisition Agreement
“Acquisition Agreement”	the conditional agreement dated 9 October 2009 and made between (1) the Company and (2) the Vendors relating to the Acquisition
“Acquisition Shares”	the 235,294,118 New Ordinary Shares in the Company to be allotted and issued as part consideration for the Acquisition pursuant to the Acquisition Agreement
“AIM”	AIM, a market operated by the London Stock Exchange
“AIM Rules”	the AIM Rules for Companies published by the London Stock Exchange from time to time
“Articles”	the articles of association of the Company
“Aupec”	Aupec Limited, a company registered in Scotland with company number SC177095, whose registered address is Davidson House, Campus 1, Aberdeen Science & Technology Park, Bridge of Don, Aberdeen AB22 8GT
“Capital Reorganisation”	the sub-division and re-designation of each issued Existing Ordinary Share into one New Ordinary Share and one Deferred Share, the sub-division of the 81,658,220 authorised but unissued Existing Ordinary Shares into 4,082,911,000 New Ordinary Shares and the amendments to the Articles
“Charles Stanley”	Charles Stanley Securities, a trading division of Charles Stanley & Co. Ltd, the Company’s nominated adviser and broker, a member of the London Stock Exchange and authorised and regulated by the FSA
“Code”	the City Code on Takeovers and Mergers, as amended from time to time
“Company”	The Parkmead Group Plc, a company registered in England with company number 3914068, whose registered address is 2nd Floor, Vigo House, 1-4 Vigo Street, London W1S 3HT
“Completion”	completion of the Acquisition in accordance with the terms of the Acquisition Agreement
“Concert Party”	Linda Cross, Thomas Cross, David Rose, Alexander Kemp, Donald MacKay and David Reading (each of them being a “member of the Concert Party”), all of whom are regarded for the purposes of the Code as acting in concert (as defined in the Code) in relation to the Company and its share capital
“Deferred Shares”	the deferred shares of 4.9 pence each in the capital of the Company resulting from the Capital Reorganisation
“Directors”	the directors of the Company
“Enlarged Group”	the Group, as enlarged following Completion
“Enlarged Ordinary Share Capital”	the 603,635,898 New Ordinary Shares in issue immediately following Completion (being the sum of the New Ordinary Shares that result from the Capital Reorganisation of the issued Existing Ordinary Shares plus the Acquisition Shares) assuming that no options or other rights to subscribe for shares of the Company are exercised between the date of this announcement and Completion
“Existing Ordinary Shares”	the Ordinary Shares of 5 pence each in the capital of the Company
“Existing Share Capital”	the 368,341,780 Existing Ordinary Shares of the Company in issue at the date of this announcement
“FSA”	the UK Financial Services Authority
“General Meeting”	the general meeting of the Company convened for 9.30 a.m. on 2 November 2009 or any adjournment of such meeting
“Group”	the Company and its subsidiary undertakings (within the meaning of section 1162 of the 2006 Act) at the date of this announcement and “Group Company” should be interpreted accordingly
“Independent Directors”	each of the Directors other than Thomas Cross
“Independent Shareholders”	the Shareholders who are entitled to vote on Resolution 1, being the Shareholders holding issued Existing Ordinary Shares other than any member of the Concert Party
“London Stock Exchange”	London Stock Exchange plc
“New Ordinary Shares”	the new Ordinary Shares of 0.1 pence each in the capital of the Company resulting from the Capital Reorganisation
“Notice”	the notice of the General Meeting
“Panel”	the Panel on Takeovers and Mergers
“Proposals”	the proposals set out in this announcement, including the Acquisition, the Capital Reorganisation and the Resolutions
“Record Date”	6.00 p.m. on 2 November 2009 (or such other date as the Directors shall determine), being the date by reference to which the Capital Reorganisation is calculated
“Resolutions”	the resolutions to be proposed at the General Meeting as set out in the Notice
“Shareholder”	a holder of shares in the capital of the Company from time to time
“Rule 9”	Rule 9 of the Code
“Vendors”	the shareholders of Aupec being Linda Cross, Thomas Cross, David Rose, Alexander Kemp, Donald MacKay and David Reading
“Whitewash”	waiver of obligations under Rule 9
“Whitewash Resolution”	the ordinary resolution of the Independent Shareholders concerning the Whitewash to be proposed on a poll at the General Meeting and set out in the Notice as Resolution 1

 

END

 

 

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