Greener House Investments plc
("GHI" or the "Company")
Final results for the year ended 31 May 2010
Greener House Investments plc (PLUS: GHIP) announces its final results for the year ended 31 May 2010.
The Company reports a loss for the year of £31,962 (2009, £21,383).
Jonathan Metliss, Chairman, commented, "Following the announcement on 29 March 2010 that the Company had
acquired a 20% interest in FreshTL Limited and conditionally agreed to acquire the balance of the shares of
that company, I am pleased to report that the financing and implementation of that transaction are
proceeding and it is intended that a circular to shareholders concerning the transaction will be issued
shortly. In the meantime I am pleased to present the Company's annual accounts for the year ended 31 May
2010."
The directors of Greener House Investments plc take responsibility for this announcement.
Enquiries:
Greener House Investments plc 020 7451 7050
Jonathan Metliss, Chairman
Daniel Stewart & Co Plc
Oliver Rigby 020 7776 6550
Chairman's and Director's Statement
Year Ended 31 May 2010
Greener House Investments PLC (PLUS: symbol GHIP) was established in 2007 by the Directors for the purpose
of acquiring companies or key stakes in companies, or to acquire businesses or assets, in the healthcare
sector. A suitable and substantial acquisition would be achieved by the issue of shares of the Company and
result with the reverse take-over of the target company which would be provided with a listing for its
shares and access to the Company's cash resources.
By 31 May 2009, numerous acquisition opportunities had been evaluated but none had satisfied our criteria
of being an established business and be profitable, or have good prospects of achieving profitability
within the next twelve months and offer good growth prospects for the future. At the Company's annual
general meeting held on 11 September 2009, the Directors were authorised to continue the pursuit of the
Company's investment strategy.
During the year the Company identified Fresh T Limited ("Fresh TL") as a suitable target for acquisition
and on 29 March 2010, announced that it had made an initial investment of £300,000 for 39,209 "A" ordinary
shares in Fresh TL pursuant to the terms of the Investment Agreement, matched by a similar simultaneous
investment in Fresh TL by the North West Interim Venture Capital Fund ("NWVCF") managed by YFM Private
Equity Ltd. This resulted in both the Company and NWVCF each owning 20% of Fresh TL share capital. The "A"
ordinary shares of Fresh TL have certain preferential rights which are set out in note 7 to the accounts.
The Company is undertaking a placing to be carried out by Daniel Stewart & Co of a minimum of £100,000 and
a maximum of £300,000 to be matched by further investment by NWVCF in Fresh TL.
The Company has also entered into conditional agreements to acquire the balance of the entire issued
ordinary share capital of Fresh TL not already owned by it for a consideration of £1,200,000 plus such
amount as is invested in Fresh TL by NWVCF to match the placing amount. The consideration is to be
satisfied by the issue of Ordinary shares of GHI.
Fresh TL, a privately owned company incorporated in the UK on 29 April 2009, is developing a global
Software as a Service ("SaaS") business around its intellectual property and distribution rights. Fresh TL
is headed by CEO John McGuire who has a wealth of experience in developing and exiting start up technology
businesses in the private and public sectors. It is the intention of Fresh TL's management to grow the
business both through the acquisition of complementary applications and distribution rights domestically
and abroad.
Although Fresh TL does not operate principally in the healthcare sector, the proposed transaction enables
Greener House to participate in a larger transaction than the resources of Greener House alone would
justify, by virtue of the additional investment being made in the Enlarged Group by NWVCF managed by YFM
and the Placing, which has been partly underwritten by Daniel Stewart & Co.
The acquisition of Fresh TL constitutes a reverse take-over of Fresh TL under the PLUS rules and,
accordingly, the Company has requested a suspension of trading in its shares. The company will apply to
PLUS for re-admission of its shares for trading upon completion of the acquisition of Fresh TL.
An Admission Document containing details of the acquisition and the placing and a notice of a general
meeting to be held immediately following the Annual General Meeting on 29 September 2010 will be sent to
Shareholders by the Company in due course. At the general meeting, Shareholders will be asked to approve
the acquisition and other resolutions proposed for its implementation, and a change of name of the Company
to Fresh TL plc.
Jonathan Metliss and Harry Hyman
6 September 2010
Greener House Investments PLC
Directors' Report
Year Ended 31 May 2010
The Directors present their report and the audited financial statements for the year ended 31 May 2010.
Business review and principal activity
The Company was established as a special purpose acquisition company, and its principal activity is to seek
a suitable acquisition of a company or business in the healthcare sector. The Company's ordinary shares
were admitted for trading on the PLUS Market on 29 October 2007.
On 29 March 2010, the Company announced that it had identified a suitable target for acquisition and that
it had made an initial investment of £300,000 for 39,209 "A" ordinary shares in Fresh T Limited ("Fresh
TL") pursuant to the terms of an Investment Agreement, matched by a similar simultaneous investment in
Fresh TL by the North West Interim Venture Capital Fund ("NWVCF") managed by YFM Private Equity Ltd. This
resulted in both the Company and NWVCF each owning 20% of Fresh TL share capital. The acquisition of Fresh
TL constitutes a reverse take-over of Fresh TL under the PLUS rules and following the Company's request
trading in its shares has been suspended. The company will apply to PLUS for re-admission of its shares
for trading upon completion of the acquisition of Fresh TL.
A review of the business and future developments is presented in the Chairman and Director's Statement.
Results and dividends
The income statement for the year is set out on page 12.
The Company's loss for the year of £31,962 (2009: £21,383) has been transferred to retained earnings.
The Directors do not recommend the payment of a dividend for the period.
Key performance indicators
The Directors are of the opinion that as the business of the Company is relatively straightforward, the
provision of key performance indicators does not necessarily promote a better understanding of the
development, position and performance of the business. Key performance indicators for the year have
therefore not been provided. The Directors will look into the introduction of suitable key performance
indicators on completion of the acquisition of Fresh T Limited.
Corporate Governance
The Directors recognise the value of the combined code on corporate governance and have considered the
recommendations and applicability to the Company in so far as it is practicable and appropriate for a
public company of its size.
Directors' Remuneration
The Directors did not receive any remuneration during the year (2009: £nil). Therefore the Company has not
prepared a Directors' remuneration report.
Directors and their interests
The following Directors have held office since 1 June 2009:
J.A. Metliss - Non Executive Chairman
H.A. Hyman - Non Executive Director
Their beneficial interests in the shares of the company are as follows:
Ordinary shares 0.1 pence each
31 May 2010 31 May 2009
J.A. Metliss 2,750,000 2,750,000
H.A. Hyman 2,750,000 2,750,000
Nexus Group Holdings Limited, a company in which H.A. Hyman is a director and shareholder, holds 20,000,000
ordinary shares of 0.1 pence each.
The total number of ordinary shares under the warrants for which Directors may subscribe for as at 31 May
2010 are as follows:
Name Date of grant Exercise price per Number of ordinary Exercise year
ordinary share (p) shares under
warrant
J.A. Metliss 10 July 2007 1p 250,000 60 months
H.A. Hyman 10 July 2007 1p 250,000 60 months
Nexus Structured Finance Limited holds 5,000,000 warrants.
Substantial shareholdings
In addition to the directors' interests disclosed above, the Company has been notified of the following
holdings of 3% or more of the ordinary issued share capital at 31 May 2010:
Number of ordinary % held
shares
Daniel Stewart Securities PLC 20,500,000 20.50%
Nexus Group Holdings Limited 20,000,000 20.00%
Bernard Kelly 13,750,000 13.75%
Leavesden Securities (Holdings) Limited 10,000,000 10.00%
Geoffrey Bowden 5,500,000 5.50%
Share capital
The authorised and issued share capital of the Company is shown in note 10 to the financial statements.
The Company aims to manage its overall capital so as to ensure that it continues to operate as a going
concern.
Related Party Transactions
Details of the transactions with related parties undertaken by the Company during the year are disclosed in
note 16 to the financial statements.
Creditors payment policy
It is the policy of the Company to establish payment terms with suppliers when agreeing terms of business
with the view of meeting due dates of payment agreed so far as it is practicable.
The number of days' purchases outstanding at 31 May 2010 was nil (2009: 31).
Post balance sheet events
The Company is currently raising between £100,000 and £300,000 before expenses through the issue and
allotment of up to 60,000,000 Ordinary Shares at a Placing price of 0.5p per share by means of a placing
being conducted by the Company's brokers Daniel Stewart & Co. The Placing is conditional on admission of
the enlarged share capital to trading on the PLUS Market and completion of the acquisition of the majority
of the shares of Fresh TL Limited from its founder shareholders. On Admission, the Company will have a
minimum of 319,989,200 Ordinary Shares and a maximum of 359,989,200 Ordinary Shares in issue and a market
capitalisation of approximately £1.6 million to £1.8 million at the Placing Price.
Following the Placing, a further subscription of an amount equivalent to the gross proceeds of the Placing
will be made by North West Interim Venture Capital Fund ("NWVCF"), managed by YFM Private Equity Ltd, NWVCF
into Fresh TL, pursuant to the Investment and Transfer Agreement. This is in addition to the £300,000
which has already been invested by NWVCF pursuant to the terms of the Investment Agreement. An aggregate
amount of between £200,000 and £600,000 will be raised by the Group under the terms of the Placing and the
subscription for shares in Fresh TL by NWVCF pursuant to the Investment Agreement and the Investment and
Transfer Agreement.
On completion of the acquisition of the balance of the Fresh TL Limited shares from NWVCF, to be completed
by 31 December 2010, the Company will have a minimum of 406,644,500 Ordinary Shares and a maximum of
446,644,500 Ordinary Shares in issue and a market capitalisation of approximately £2.03 million to £2.23
million at the Placing Price.
Financial instruments
The Company's principal financial instruments comprise investments, cash, other receivables, trade and
other payables. The main purpose of these financial assets is to fund the Company's operations as well as
to manage working capital, liquidity and invest surplus funds.
The Directors consider that the carrying values of all the Company's financial assets and liabilities
approximate to their fair values as at the balance sheet dates.
Internal controls
The Directors have reviewed the Company's system of internal control which is designed to safeguard the
assets of the Company and ensure the reliability of financial information for both internal use of and
external publication.
Going Concern
As the Company has sufficient cash resources to meet its operational requirements the Directors expect that
the Company will continue in operational existence for the foreseeable future. The going concern basis has
therefore been used to prepare these financial statements.
Management of risks
The Directors continue to assess the risks facing the Company. The acquisition of an appropriate business
or company is key to the success of the Company, and is in turn the most significant risk facing the
Company.
The other risks the Company is exposed to are as follows:
Interest rate risk
The Company continues to finance its operations from the original issue of equity. Surplus cash balances
are held in a sterling money fund in the short term and returns are expected to fluctuate with the rates of
interest. The benchmark rate which determines the interest rate received on interest bearing cash balances
is the LIBOR.
Liquidity risk
The Company has sufficient cash to meet its operational requirements.
Currency risk
The Company's income and expenses are denominated in sterling. Accordingly the Company is not exposed to
any significant currency risk.
Credit risk
The Company has no significant credit risk.
Company law requires the Directors to prepare financial statements for each financial year which give a
true and fair view of the state of affairs of the Company and the Group and of the profit or loss of the
Group for that year. In preparing those financial statements, the Directors are required to:
* Select suitable accounting policies and then apply them consistently;
* Make judgements and estimates that are reasonable and prudent;
* State whether they have been prepared in accordance with International Financial reporting
Standards ("IFRS") as adopted by the European Union; and
* Prepare the financial statements on the going concern basis unless it is inappropriate to presume
that the Company will continue in business.
The Directors are responsible for keeping adequate accounting records which disclose with reasonable
accuracy at any time the financial position of the Company to enable them to ensure that the financial
statements comply with the Companies Act 2006. They are also responsible for the system of internal
control, for safeguarding the assets of the Company and for taking reasonable steps for the prevention and
detection of fraud and other irregularities.
The Directors are responsible for the maintenance and integrity of the Company's website. Legislation in
the United Kingdom governing the preparation and dissemination of financial statements may differ from
legislation in other jurisdictions.
Auditors
The Company's auditors Sedley Richard Laurence Voulters have changed their name to SRLV.
SRLV have expressed their willingness to remain in office and resolutions reappointing them as auditors and
authorising the Directors to fix their remuneration will be put to the Annual General Meeting.
Statement of disclosure to auditor
(a) So far as the directors are aware, there is no relevant audit information of which the company's
auditors are unaware, and
(b) The Directors have taken all the steps that they ought to have taken as directors in order to make
themselves aware of any relevant audit information and to establish that the company's auditors are aware
of that information.
By order of the Board
For and on behalf of Nexus Structured Finance Limited
Secretary
6 September 2010
Independent Auditors' Report to the Shareholders of Greener House Investments PLC
We have audited the financial statements of Greener House Investments Plc for the year ended 31 May 2010
set out on pages 12 to 24. The financial reporting framework that has been applied in their preparation
is applicable law and International Financial Reporting Standards (IFRSs) as adopted by the European Union.
Respective responsibilities of directors and auditors
As explained more fully in the Directors' Responsibilities Statement on page 9, the directors are
responsible for the preparation of the financial statements and for being satisfied that they give a true
and fair view. Our responsibility is to audit the financial statements in accordance with applicable law
and International Standards on Auditing (UK and Ireland). Those standards require us to comply with the
Auditing Practices Board's Ethical Standards for Auditors.
Scope of the audit of the financial statements
An audit involves obtaining evidence about the amounts and disclosures in the financial statements
sufficient to give reasonable assurance that the financial statements are free from material misstatement,
whether caused by fraud or error. This includes an assessment of: whether the accounting policies are
appropriate to the company's circumstances and have been consistently applied and adequately disclosed; the
reasonableness of significant accounting estimates made by the directors; and the overall presentation of
the financial statements.
Opinion on financial statements
In our opinion the financial statements:
* give a true and fair view of the state of the company's affairs as at 31 May 2010 and its loss for
the year then ended;
* have been properly prepared in accordance with IFRSs as adopted by the European Union; and
* have been prepared in accordance with the requirements of the Companies Act 2006.
Opinion on other matters prescribed by the Companies Act 2006
In our opinion
* the information given in the Directors' Report for the financial year for which the financial
statements are prepared is consistent with the financial statements.
Matters on which we are required to report by exception
We have nothing to report in respect of the following matters where the Companies Act 2006 requires us to
report to you, if in our opinion:
* adequate accounting records have not been kept or returns adequate for our audit have not been
received from branches not visited by us; or
* the financial statements and the part of the Directors' Remuneration Report that is subject to
audit are not in agreement with the accounting records and returns; or
* certain disclosures of directors' remuneration specified by law are not made; or
* we have not received all the information and explanations we require for our audit.
Under the Listing Rules we are required to review:
* the directors' statement in relation to going concern; and
* the part of the Corporate Governance Statement relating to the company's compliance with the
provisions of the 2006 Combined Code specified for our review.
ALOK VERMA (Senior Statutory Auditor)
For and on behalf of SRLV 89 New Bond Street
Statutory Auditor London
W1S 1DA
6 September 2010
Greener House Investments PLC
Statement of Comprehensive Income
Year Ended 31 May 2010
2010 2009
Note
£ £
Revenue - -
--------------------------------
--------------------------------
Administrative expenses (32,536) (31,506)
--------------------------------
Operating loss 2 (32,536) (31,506)
Finance income 4 574 10,123
--------------------------------
Loss before tax (31,962) (21,383)
Taxation 5 - -
--------------------------------
Loss for the year (31,962) (21,383)
--------------------------------
--------------------------------
Loss per share expressed in pence per share
Basic 6 0.032 0.021
Diluted 6 0.027 0.018
The profit and loss account has been prepared on the basis that all operations are continuing operations.
There are no gains or losses other than those passing through the profit and loss account.
The notes below form part of these accounts.
Greener House Investments PLC
Statement of Financial Position at 31 May 2010
2010 2009
Note
£ £
ASSETS
Non current assets
Investments 7 300,000 -
Current assets
Other receivables 8 4,269 4,173
Current asset investment 9 796 366,209
Cash and cash equivalents 30,784 440
------------------------------------
35,849 370,822
------------------------------------
TOTAL ASSETS 335,849 370,822
------------------------------------
------------------------------------
EQUITY AND LIABILITIES
Capital and reserves
Share capital 10 100,025 100,025
Share premium 298,279 298,279
Retained earnings (72,550) (40,588)
------------------------------------
Total shareholders' equity 325,754 357,716
Current liabilities
Trade and other payables 11 10,095 13,106
------------------------------------
TOTAL EQUITY AND LIABILITIES 335,849 370,822
------------------------------------
------------------------------------
Approved by the Board and authorised for issue on 6 September 2010
H.A. Hyman
Director
The notes below form part of these accounts.
Greener House Investments PLC
Statement of Cash Flows
Year Ended 31 May 2010
2010 2009
£ £
Operating activities
Operating loss for the year (32,536) (31,506)
Adjustments for:
Increase in other receivables (96) (109)
Increase in trade and other payables (3,012) 4,881
------------------------------------
Net cash used for operating activities (35,644) (26,734)
------------------------------------
Investing activities
Interest received 574 10,123
Proceeds from redemption of investment 365,414 15,538
------------------------------------
Net cash generated from/(used for) investing activities 365,988 25,661
------------------------------------
Capital expenditure and financial investments
Payments to acquire fixed asset investment (300,000) -
------------------------------------
Net (decrease)/increase in cash and cash equivalents 30,344 (1,073)
Cash and cash equivalents at beginning of the year 440 1,513
------------------------------------
Cash and cash equivalents at end of the year 30,784 440
------------------------------------
------------------------------------
Greener House Investments PLC
Statement of Changes in Equity
Year Ended 31 May 2010
Share Share Retained Total
Capital Premium Earnings
£ £ £ £
Balance as at 1 June 2009 100,025 298,279 (40,588) 357,716
Loss for the year - - (31,962) (31,962)
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Balance as at 31 May 2010 100,025 298,279 (72,550) 325,754
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Greener House Investments PLC
Notes to the Financial Statements
Year Ended 31 May 2010
1. Accounting policies
a) (i) General information
The Company is a public limited company incorporated on 8 May 2007 and domiciled in England and
Wales. The Company was established as a special purpose acquisition company whose principal
activity was to seek a suitable acquisition of a company or business in the healthcare sector. The
Company's ordinary shares were admitted for trading on the PLUS Market on 29 October 2007.
On 29 March 2010, the Company announced that it had identified a suitable target for acquisition
and had entered into conditional agreements to acquire the entire issued ordinary share capital of
Fresh T Limited ("Fresh TL") for a consideration of £900,000. The acquisition of Fresh TL
constitutes a reverse take-over of Fresh TL under the PLUS rules and following the Company's
request trading in its shares has been suspended. The company will apply to PLUS for re-admission
of its shares for trading upon completion of the acquisition of Fresh TL.
The Company's financial statements for the year ended 31 May 2010 were approved by the Board of
Directors on 6 September 2010 and its Statement of Financial Position at 31 May 2010 on page 13
was signed by H. A. Hyman, a director of the Company.
(ii) Accounting convention and basis of preparation
These financial statements have been prepared in accordance with International Financial Reporting
Standards (IFRSs), and IFRIC interpretations as adopted by the European Union, and with those
parts of the Companies Act 2006 applicable to companies reporting under IFRS. The financial
statements have been prepared under the historical cost convention.
The preparation of the financial information requires management to make estimates and assumptions
that affect the reported amounts of revenues, expenses, assets and liabilities, and the disclosure
of contingent liabilities at the date of the financial information. If in the future such
estimates and assumptions, which are based on management's best judgment at the date of the
financial information, deviate from the actual circumstances, the original estimates and
assumptions will be modified as appropriate in the year in which circumstances change.
(iii) Standards issued but not yet effective
The IASB and IFIC have issued a number of standards and the interpretations with an effective date
after the date of these financial statements. The directors have set out below only those which
may have a material impact on the financial statements in future periods.
Amendment to IAS 24: Related parties
The amendment provides an exemption from disclosure requirements for transactions between entities
controlled, jointly controlled or significantly influenced by the same state ('state-controlled
entities'). It also amends the definitions of a related party and of a related party transaction
to clarify the intended meaning and remove some inconsistencies. The amendment is expected to be
effective for accounting periods beginning after 2011.
Amendment to IAS 39: Financial instruments: Recognition and measurement: Reclassification of
Financial Assets
This amendment clarifies the effective date of the reclassification of financial assets. The
amendment is effective under IFRS but has not yet been endorsed by the European Union and has
therefore not been adopted by the Company.
Amendments to IFRS 3R Business Combinations and IAS 27R Consolidated and Separate Financial
Statements
These revisited standards are effective for financial years beginning on or after 1 July 2009.
IFRS 3R introduces a number of changes in the accounting for business combinations occurring after
this date that will impact the amount of any goodwill recognised, the reporting results in the
period that an acquisition occurs and future reported results. IAS 27R requires that a change in
the ownership interest of a subsidiary (without loss of control) is accounted for as an equity
transaction. Therefore, such transactions will no longer give rise to goodwill, nor will they give
rise to a gain or loss. Furthermore, the amended standard changes the accounting for losses
incurred by the subsidiary as well as the loss of control of a subsidiary.
Improvements to IFRS 2009
General improvements to various existing standards will be adopted by the Company which come into
effect from 1 May 2010 subject to endorsement by the European Union.
b) Non current investments
Unlisted investments and investments in subsidiaries are stated at cost less any provision for
permanent diminution in value.
Listed investments are stated at market value. Realised gains and losses are charged to the profit
and loss account in the year in which they arise. Unrealised gains and losses are taken to the
revaluation reserve. In the opinion of the directors, the adoption of alternative accounting
rules for listed investments provides a more appropriate view of the state of affairs of the
Company at the year end.
c) Current asset investments, cash and cash equivalents
Current asset investments, cash and cash equivalents comprise cash at bank and short term deposits
with banks and similar financial institutions. These deposits are readily convertible to known
amounts of cash and are subject to insignificant risk of changes in value.
d) Taxes
Tax expense represents the sum of the tax currently payable and deferred tax.
Deferred tax is provided, using the liability method, on temporary differences between the tax
bases of assets and liabilities and their carrying amounts, in the financial statements. Deferred
tax assets relating to the carry-forward of unused tax losses are recognised to the extent that it
is probable that future taxable profits will be available against which the unused tax losses can
be utilised.
Current and deferred tax assets and liabilities are offset when the income taxes are levied by the
same taxation authority and when there is a legally enforceable right to offset them.
e) Share-based payments
Warrants issued to Directors and founder members are accounted for as share-based transactions in
accordance with IFRS 2. Equity-settled share-based payments are measured at fair value at the
date of the grant. The fair value at the date of the grant is determined using the Black-Scholes
pricing model and expensed on a straight-line basis over the vesting period based on the Company's
estimate of the shares that will eventually vest and where applicable, adjusted for the effect of
non market-based vesting conditions.
f) Foreign currency
Items included in the financial statements are measured using the currency of the primary economic
environment in which the entity operates. Pound sterling is the functional currency of Greener
House Investments PLC.
g) Revenue recognition
i) Turnover
Revenue is recognised when due and any amounts collected in advance or arrears are included in
debtors or creditors, as applicable. Revenue is measured at the fair value of the
consideration received excluding discounts, rebates, VAT and other sales taxes or duty.
ii) Interest income
Revenue is recognised as interest accrues, using the effective interest method (that is the
rate that exactly discounts estimated future cash receipts through the expected life of the
financial instrument to the net carrying amount of the financial asset).
2. Operating loss
The operating loss is stated after charging:
2010 2009
£ £
Auditors' remuneration 4,700 4,600
--------------------------------
--------------------------------
3. Employee costs
Apart from the Directors there were no employees during the year. The Directors did not receive any
remuneration from the Company.
4. Finance income
2010 2009
£ £
Bank interest receivable 574 10,123
--------------------------------
--------------------------------
5. Taxation
2010 2009
£ £
UK Corporation Tax - -
--------------------------------
--------------------------------
Loss on ordinary activities before taxation multiplied
by standard rate of UK Corporation Tax of 21% (2009: 28%) (6,712) (5,987)
Effect of:
Disallowable expenditure - -
Tax losses 6,712 5,987
--------------------------------
Current tax charge - -
--------------------------------
--------------------------------
There is no corporation tax payable on the results for the year, the Company has unused tax losses of
£72,550 (2009: £40,588) to carry forward.
6. Earnings per share
Basic loss per share is based on the loss after taxation of £31,962 (2009: £21,383) and the weighted
average number of ordinary shares of 0.1 pence each in issue during the year of 100,025,000 (2009:
100,025,000).
For diluted loss per share, the weighted average number of shares in issue is adjusted to assume conversion
of all dilutive potential shares. The Company created 16,875,000 warrants by a warrant instrument dated 10
July 2007, constituting warrants to subscribe for 16,875,000 ordinary shares at a subscription price of 1p
per warrant share. The maturity date of the warrant rights issue is 60 months after the date of issue of
the warrant certificate. The adjusted weighted average number of ordinary shares in issue during the year
was 116,900,000 (2009: 116,900,000).
7. Investments
Fixed asset investments comprise the Company's investment in 39,209 "A" ordinary shares in Fresh T Limited
representing 20% of the nominal value of the share capital of that company which the Company acquired on 26
March 2010 at a cost of £300,000. The investment represents an initial investment in Fresh T Limited made
in accordance with conditional agreements entered into by the Company to acquire the entire issued share
capital of Fresh T Limited. The transactions constitute a reverse take-over of Fresh T Limited under the
PLUS rules and will, on completion, ultimately result with Fresh T Limited becoming a wholly-owned
subsidiary of the Company.
Fresh T Ltd was incorporated on 29 April 2009 in England and Wales and operates wholly in the United
Kingdom. Its principal activity is the development and distribution of computer software. Fresh T Limited
has prepared accounts for the period from the date of its incorporation to 31 December 2009. The aggregate
amount of capital and reserves at 31 December 2009 and the results of the company for the period are as
follows:
£
Aggregate capital and reserves as at 31 December 2009 (60,563)
Loss for the period ended 31 December 2009 (61,563)
-----------
-----------
The "A" ordinary shares of Fresh T Limited have preferential rights over payment of dividends by Fresh T
Limited and on return of assets by Fresh T Limited; and on the occurrence of certain Specified Events they
carry 100,000 votes per A ordinary share.
In the opinion of the Directors, the Company does not, as at the yearend date, exercise significant
influence over Fresh T Limited and therefore that company has not been accounted for as an associate.
8. Other receivables
2010 2009
£ £
Prepayments 4,269 4,173
-------------------------------
-------------------------------
9. Current asset investments
2010 2009
£ £
Sterling Money Fund 796 366,209
-------------------------------
-------------------------------
10. Share capital
2010 2009
£ £
Authorised
250,000,000 ordinary shares of 0.1 pence each 250,000 250,000
-------------------------------
-------------------------------
2010 2009
£ £
Issued and fully paid
100,025,000 ordinary shares of 0.1 pence each 100,025 100,025
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-------------------------------
11. Trade and other payables
2010 2009
£ £
Trade payables - 447
Amounts due to related parties (note 16) - 2,255
Accruals 10,095 10,404
-------------------------------
10,095 13,106
-------------------------------
-------------------------------
12. Financial risk factors
The Company's overall risk management programme focuses on the unreliability of financial markets and seeks
to minimise potential adverse effects of the financial risks which it is exposed to as a result of its
activities.
Risk management is carried out by the Company's Board of Directors. The Board identifies and evaluates
financial risks and provides principles for overall risk management as well as policies covering specific
areas such as credit risk, interest rate risk, liquidity risk and foreign currency risk.
As disclosed in the Director's Report, the acquisition of an appropriate business or company is key to the
success of the Company, and is in turn the most significant risk facing the Company.
The other risks the Company is exposed to are as follows:
Interest rate risk
The Company continues to finance its operations from the original issue of equity. Surplus cash balances
are held in a sterling money fund in the short term and returns are expected to fluctuate with the rates of
interest. The benchmark rate which determines the interest rate received on interest bearing cash balances
is the LIBOR.
Liquidity risk
The Company has sufficient cash to meet its operational requirements.
Currency risk
The Company's income and expenses are denominated in sterling. Accordingly the Company is not exposed to
any significant currency risk.
Credit risk
The Company has no significant credit risk.
13. Share-based payments
The Company created 16,875,000 warrants by a warrant instrument dated 10 July 2007, constituting warrants
to subscribe for 16,875,000 ordinary shares at a subscription price of 1p per warrant share. The maturity
date of the warrant rights issue is 60 months after the date of issue of the warrant certificate. The
warrants were granted to its Directors and founder shareholders.
The warrants were valued using the Black-Scholes option-pricing model. No performance criteria were
included in the fair value calculations. The fair value of each warrant granted and the assumptions used
in the calculation is as follows:
Grant date 10 July 2007
Exercise price £0.01
Current market price per share based on Placing price per share (see note 15) £0.005
Expected volatility 15%
No. of years to maturity 5 years
Expected life 5 years
Vesting period 5 years
Risk free rate 3%
Fair value of warrants £nil
The expected volatility is based on management's best estimate. The risk free rate is the yield on zero-
coupon UK government bonds of a term consistent with the life of the warrants.
The total charge for the year relating to warrants granted amounted to £nil (2009: £nil).
A reconciliation of movement in warrants during the year ended 31 May 2010 is shown below:
2010 2009
-----------------------------------------------------------------
Weighted Weighted
average average
exercise exercise
Number price Number price
Outstanding at 1 June 2009 16,875,000 £0.01 16,875,000 £0.01
Granted - - - -
Exercised - - - -
Expired - - - -
Outstanding at 31 May 2010 16,875,000 £0.01 16,875,000 £0.01
Exercisable at 31 May 2010 16,875,000 £0.01 16,875,000 £0.01
-----------------------------------------------------------------
-----------------------------------------------------------------
14. Future financial commitments
The Company has engaged Daniel Stewart & Co (Corporate Adviser and Broker), Nexus Corporate Finance LLP
(Financial Adviser), Hazlewoods (Chartered Accountants) and Davenport Lyons (Solicitors) as its
professional advisers in respect of the proposed acquisition of Fresh TL, share placing and admission of
the enlarged share capital to the PLUS Market. The aggregate fees payable to these advisers on completion
of the transaction is expected to amount to approximately £90,000 + VAT.
At 31 May 2010 the Company has commitments under conditional agreements it had entered into during the year
to acquire the balance of the entire issued ordinary share capital of Fresh TL not already owned by it for
a consideration of £1,200,000 plus such amount as is invested in Fresh TL by NWVCF to match the placing
amount as referred to in note 15 below. The consideration is to be satisfied by the issue of Ordinary
shares of GHI.
15. Events after the balance sheet date
The Company is currently raising between £100,000 and £300,000 before expenses through the issue and
allotment of up to 60,000,000 Ordinary Shares at a Placing price of 0.5p per share by means of a placing
being conducted by the Company's brokers Daniel Stewart & Co. The Placing is conditional on admission of
the enlarged share capital to trading on the PLUS Market and completion of the acquisition of the majority
of the shares of Fresh TL Limited from its founder shareholders. On Admission, the Company will have a
minimum of 319,989,200 Ordinary Shares and a maximum of 359,989,200 Ordinary Shares in issue and a market
capitalisation of approximately £1.6 million to £1.8 million at the Placing Price.
Following the Placing, a further subscription of an amount equivalent to the gross proceeds of the Placing
will be made by North West Interim Venture Capital Fund ("NWVCF"), managed by YFM Private Equity Ltd, NWVCF
into Fresh TL, pursuant to the Investment and Transfer Agreement. This is in addition to the £300,000
which has already been invested by NWVCF pursuant to the terms of the Investment Agreement. An aggregate
amount of between £200,000 and £600,000 will be raised by the Group under the terms of the Placing and the
subscription for shares in Fresh TL by NWVCF pursuant to the Investment Agreement and the Investment and
Transfer Agreement.
On completion of the acquisition of the balance of the Fresh TL Limited shares from NWVCF, to be completed
by 31 December 2010, the Company will have a minimum of 406,644,500 Ordinary Shares and a maximum of
446,644,500 Ordinary Shares in issue and a market capitalisation of approximately £2.03 million to £2.23
million at the Placing Price.
16. Related Party Transactions
Harry Hyman is the controlling party of Nexus Structured Finance Limited and Nexus Corporate Finance LLP.
During the year fees and expenses of £1,664 and £7,024 (2009: £1,398 and £6,926) were payable to each
company respectively. At 31 May 2010 no amounts were owed to Nexus Structured Finance Limited and Nexus
Corporate Finance LLP (2009: £345 and £1,910 respectively).
17. Ultimate controlling party
There is no one controlling party.
The Company yesterday sent a copy of its Annual Report and Accounts to shareholders together with a notice
of the Annual General Meeting (AGM). The AGM of the Company will be held at the offices of Daniel Stewart
& Co Becket House, 36 Old Jewry, London EC2R 8DD on 29 September 2010 at 10.30 am.
Greener House Investments Plc