AGM Information • May 31, 2013
AGM Information
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THIS CIRCULAR IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION. If you are in any doubt as to the action you should take, you should consult an appropriate independent financial adviser authorised under the Financial Services and Markets Act 2000 immediately. If you have sold or transferred all your Ordinary Shares in the Company, please forward this Circular together with the Form of Proxy to the purchaser, transferee, stockbroker or other agent through whom the sale or transfer was effected, for transmission to the purchaser or transferee.
Notice of the 2013 Annual General Meeting of the Company to be held at the Life Bioscience Centre, Times Square, Newcastle upon Tyne NE1 4EP at 11.30am on Wednesday 17 July 2013 is set out on pages 6 to 8 of this Circular. A Form of Proxy for use at the meeting is attached. To be valid, Forms of Proxy should be completed and returned in accordance with the notes to the Notice of Meeting and the Form of Proxy itself.
Northumberland House Princess Square Newcastle upon Tyne NE1 8ER
T 0191 244 6000 F 0191 244 6001 E [email protected]
Registered in England no 4280530 Directors: 31 May 2013 James Ferguson, Chairman Chris Fleetwood Tim Levett John Waddell
Dear Shareholder
I am pleased to be writing to you with details of our Annual General Meeting which will take place at 11.30am on Wednesday 17 July 2013 at the Life Bioscience Centre, Times Square, Newcastle upon Tyne NE1 4EP. The formal Notice of Annual General Meeting is set out on pages 6 to 8 of this document.
Explanatory notes on all the business to be considered at this year's AGM appear on pages 3 to 5 of this document.
Your Board has considered the likely funding requirements of the Company over the next two to three years, taking into account the flow of potential investment opportunities and the Company's dividend and share buy-back policies, and proposes that there should be a public share offer by the Company in the 2013/14 tax year to raise a total of up to £20 million for future investment (the "Offer"). Subject to obtaining the requisite approvals including Shareholder approval at the AGM, it is expected that a prospectus will be issued in July 2013. The Offer will be structured as a joint prospectus offer with Northern Venture Trust PLC and Northern 2 VCT PLC.
Applications for the new Ordinary Shares will be considered on a first come first served basis, subject to your Board's discretion. Investors will be allowed to make applications for shares in either or both of the 2013/14 and 2014/15 tax years. It is envisaged that the Offer will remain open until 5 April 2014 in respect of the 2013/14 tax year and until late April 2014 in respect of the 2014/15 tax year, unless fully subscribed at an earlier date and subject to your Board's right to close the Offer at any time.
The new Ordinary Shares will be issued at a premium to the latest published NAV prior to the relevant allotment date to allow for issue costs and to avoid any dilution in the NAV attributable to each existing Ordinary Share when the new Ordinary Shares are issued.
Any new Ordinary Shares will rank pari passu in all respects with the existing Ordinary Shares and will rank for all dividends which are both declared and paid following Admission. Application will be made for the Admission of any new Ordinary Shares allotted and it is proposed that Admission will be effected at the earliest practicable opportunity for each tranche of Ordinary Shares to be allotted.
Full details of the Offer will be contained in the prospectus expected to be issued in July 2013.
The Articles presently require that a resolution for the continuation of the Company be put to the annual general meeting of the Company held in 2015 and, unless defeated, at five-yearly intervals thereafter. The proposed amendment to the Articles requires the continuation resolution to be considered at the annual general meeting of the Company expected to be held in July 2019 and every five years thereafter. This amendment will have the effect of postponing the continuation resolution until a period of five years has elapsed from the allotment of Ordinary Shares under the Offer, five years being the minimum holding period to ensure that investors retain the initial income tax relief on their subscription.
Your Board has decided to introduce a new Dividend Investment Scheme ("DRIS") in place of the existing Dividend Reinvestment Plan ("Existing DRIP"). The Existing DRIP operates by re-investing participants' dividends in existing Ordinary Shares purchased in the market and was introduced in January 2010. Over the ensuing three years the number of participants in the Existing DRIP has remained at a very low level and there has been no perceptible beneficial impact on the secondary market in the Company's Ordinary Shares. The Directors have therefore decided to discontinue the Existing DRIP with immediate effect and to replace it with the new DRIS, under which participants' dividends will be invested in new Ordinary Shares in the Company. This will not only provide the Company with additional funds for investment but will also enable Shareholders participating in the new DRIS who are "eligible investors" to obtain the tax reliefs available to subscribers under the current VCT legislation, including 30% income tax relief on their investment.
Further information on the new DRIS is given in a separate circular to shareholders which accompanies this Circular.
If you would like to vote on the resolutions but cannot attend the AGM, please complete the Form of Proxy attached to this notice and return it to the Company's registrars, Equiniti Limited, at Aspect House, Spencer Road, Lancing BN99 6DA as soon as possible. They must receive it no later than 11.30am on Monday 15 July 2013. Completion and return of the Form of Proxy will not preclude you from attending the AGM and voting in person should you so wish.
Your Board considers that all the resolutions to be put to the meeting are in the best interests of the Company and its Shareholders as a whole and are most likely to promote the success of the Company for the benefit of its Shareholders. Your Directors will be voting in favour of the resolutions in respect of their own shareholdings and unanimously recommend that you do so as well.
Yours sincerely
JAMES FERGUSON Chairman
In this letter, unless the context otherwise requires, the following expressions bear the following meanings:
| Admission | Admission of Ordinary Shares to the Official List of the UK Listing Authority and to trading on the premium segment of the London Stock Exchange's market for listed securities |
|---|---|
| AIC Code | the AIC Code of Corporate Governance published from time to time by the Association of Investment Companies |
| Annual General Meeting or AGM | the annual general meeting of the Company to be held at the Life Bioscience Centre, Times Square, Newcastle upon Tyne NE1 4EP at 11.30am on Wednesday 17 July 2013 |
| Articles | the articles of association of the Company as amended from time to time |
| Circular | this document dated 31 May 2013 addressed to the Shareholders |
| Company | Northern 3 VCT PLC |
| Directors or Board | the directors of the Company, whose names are set out on page 1 of this document |
| DRIS | has the meaning set out on page 2 of this Circular |
| Existing DRIP | has the meaning set out on page 2 of this Circular |
| FCA | the Financial Conduct Authority or its successor |
| Form of Proxy | the form of proxy for use at the Annual General Meeting |
| Listing Rules | the listing rules of the Financial Conduct Authority made under Part VI of the Financial Services and Markets Act 2000 (as amended from time to time) |
| NAV | net asset value in pence per Ordinary Share |
| Offer | has the meaning set out on page 1 of this Circular |
| Ordinary Shares | ordinary shares of 5p each in the capital of the Company |
| Record Date | 5 July 2013 |
| Shareholders | holders of Ordinary Shares |
All resolutions will be proposed as ordinary resolutions, unless otherwise mentioned. For an ordinary resolution to be passed, more than half of the votes cast (in person or by proxy) must be in favour of the resolution. For a special resolution to be passed, at least three-quarters of the votes cast (in person or by proxy) must be in favour of the resolution.
The Company is required by law to put the Company's annual report and financial statements for the year ended 31 March 2013 before Shareholders. Shareholders are invited to vote to receive the annual report and financial statements for the year ended 31 March 2013.
Shareholders are being asked to approve a final dividend of 3.5p per Ordinary Share in respect of the year ended 31 March 2013. If you approve the recommended final dividend, this will be paid on 26 July 2013 to all Shareholders who were on the register of members on 5 July 2013.
The Company is required by law to seek Shareholders' approval of the Directors' remuneration report in respect of the year ended 31 March 2013, which is set out on pages 18 and 19 of the Company's annual report for the year ended 31 March 2013. Whilst the payment of remuneration to the Directors is not dependent on the passing of the resolution, your Board will take the vote into account when considering the future development and operation of the Company's remuneration policy and practice.
Mr C J Fleetwood retires from the Board by rotation in accordance with the articles of association and seeks re-election. Mr T R Levett retires from the Board in accordance with the AIC Code and also seeks re-election. Your Board believes that each of the Directors seeking re-election makes a relevant and significant contribution to the operation of the Board and displays an appropriate level of knowledge and experience.
Mr Chris Fleetwood (aged 61) was appointed to the Board in 2001. He is managing partner of io solutions (e-business strategy advisers), chairman of Digital City Business Trading Limited, a non-executive director of NCFE Limited and a governor of Teesside University. He was formerly chairman of Darlington Building Society and group chief executive of Whessoe plc.
Mr Tim Levett (aged 64) was appointed to the Board in 2001. He is a member of the nomination committee.
Mr Levett is chairman of NVM Private Equity Limited. He is a non-executive director of Northern Venture Trust PLC and of several unquoted companies and was a co-founder of NVM in 1988.
The Company's independent auditor, KPMG Audit Plc, has instigated an orderly wind-down of its business and has notified the Company that it is not seeking re-appointment at the Annual General Meeting. The Company has received a statutory statement from KPMG Audit PIc pursuant to Section 519 of the Companies Act 2006 which is enclosed as an appendix to this Circular in accordance with Section 520 of the Companies Act 2006. This resolution proposes that KPMG LLP is appointed as independent auditor of the Company in succession to KPMG Audit Plc from the conclusion of the Annual General Meeting until the conclusion of the next annual general meeting of the Company.
Shareholders are invited to vote to give the Directors authority to fix the independent auditor's remuneration.
Shareholders are being asked to grant the Directors a general authority to allot shares in the Company. This resolution, if passed, gives the Directors authority to allot Ordinary Shares up to a maximum nominal value of £1,341,591 representing approximately 56% of the Company's issued ordinary share capital at the date of the notice convening the Annual General Meeting. Of the £1,341,591, £1,100,000 is intended to be used for purposes of the Offer and £241,591 is authorised generally. The Directors have no present intention of exercising such general authority except in connection with the issue of Ordinary Shares pursuant to the Company's new DRIS, details of which are enclosed in a separate circular to shareholders which accompanies this Circular.
This authority will be effective until the conclusion of the next annual general meeting of the Company (expected to be held in July 2014) or, if earlier, 30 September 2014 except insofar as commitments to allot shares have been entered into before that date.
This resolution supplements the Directors' authority to allot shares in the Company given to them by Resolution 8. The resolution authorises the Directors to allot equity Ordinary Shares, or sell treasury shares, for cash (otherwise than pro rata to existing Shareholders) up to an aggregate nominal value of £1,341,591 representing approximately 56% of the Company's issued ordinary share capital at the date of the notice convening the Annual General Meeting. Of the £1,341,591, £1,100,000 is intended to be used for purposes of the Offer and £241,591 is authorised generally. The Directors have no present intention of exercising such general authority except in connection with the issue of Ordinary Shares pursuant to the Company's new DRIS.
The authority will be effective until the conclusion of the next annual general meeting of the Company (expected to be held in July 2014) or, if earlier, 30 September 2014, save that the Directors may so allot equity shares or sell treasury shares in pursuance of an offer or agreement entered into before the authority expires.
Resolution 9 will be proposed as a special resolution.
This resolution authorises the Company to purchase in the market up to 4,831,826 Ordinary Shares (equivalent to approximately 10% of the issued ordinary share capital) at a minimum price per share of 5p and a maximum price per share of not more than 105% of the average market value of the relevant shares for the five business days prior to the date on which the purchase is made.
Unless previously renewed, varied or revoked, the authority will be effective until the conclusion of the next annual general meeting of the Company (expected to be held in July 2014) or, if earlier, 30 September 2014.
Purchases of Ordinary Shares will be made only within the guidelines established and to be reviewed from time to time by the Directors, and where it is considered that such purchases would be to the advantage of the Company and its Shareholders as a whole. It is the Directors' intention that purchases will be made in the market for cash only at prices below the prevailing net asset value per share thereby enhancing the net asset value per share for the Company's remaining shareholders. Purchases will be financed from the Company's own cash resources or, if appropriate, from short term borrowings.
The cap on the price payable contained in the proposed resolution reflects part of a restriction on the Company contained in the Listing Rules. In addition, under the Listing Rules the Company must not purchase shares at a price greater than the higher of the last independent trade and the highest current independent bid on the market where the purchase is carried out.
There are no existing Ordinary Shares covered by options or warrants at the date of publication of this document.
Shares purchased under this authority become treasury shares which the Company can cancel or hold for sale for cash.
Resolution 10 will be proposed as a special resolution.
The Articles presently require that a resolution for the continuation of the Company be put to the annual general meeting of the Company held in 2015 and, unless defeated, at five-yearly intervals thereafter. The proposed amendment to Article 147 requires the continuation resolution to be considered at the annual general meeting of the Company expected to be held in July 2019 and every five years thereafter. This amendment will have the effect of postponing the continuation resolution until a period of five years has elapsed from the allotment of Shares under the proposed offer, five years being the minimum holding period to ensure that investors retain the initial income tax relief on their subscription.
Article 147 of the Articles in its current form is set out below:
Resolution 11 will be proposed as a special resolution.
Notice is hereby given that the eleventh annual general meeting of the Company will be held at the Life Bioscience Centre, Times Square, Newcastle upon Tyne NE1 4EP at 11.30am on Wednesday 17 July 2013 for the following purposes:
"That in substitution for and to the exclusion of any power previously conferred upon the Directors in this regard (save to the extent relied upon prior to the passing of this resolution), the Directors be generally and unconditionally authorised pursuant to Section 551 of the Companies Act 2006 ("the Act") to allot shares in the Company and to grant rights to subscribe for or to convert any security into shares in the Company up to a maximum nominal amount of £1,341,591 for a period expiring (unless previously renewed, varied or revoked by the Company in general meeting) on the conclusion of the next annual general meeting of the Company after the passing of this resolution or, if earlier, 30 September 2014, save that the Company may before expiry of this authority make an offer or agreement which would or might require shares to be allotted, or rights to subscribe for or to convert any security into shares to be granted, after expiry of this authority and the Directors may allot shares, or grant rights to subscribe for or convert any security into shares, in pursuance of that offer or agreement as if this authority had not expired."
9 To consider and, if thought fit, to pass the following resolution as a special resolution:
"That, subject to the passing of Resolution 8 above and in substitution for and to the exclusion of any power previously conferred upon the Directors in this regard (save to the extent relied upon prior to the passing of this resolution), the Directors may:
in each case as if Section 561(1) of the Act (existing shareholders' right of pre-emption) did not apply to the allotment or sale, provided that the power conferred by this resolution shall be limited to the allotment or sale of equity securities up to an aggregate nominal value of £1,341,591 and shall expire on the conclusion of the next annual general meeting of the Company after the passing of this resolution or, if earlier, 30 September 2014, save that the Company may before this power expires make an offer or agreement which would or might require equity securities to be allotted or treasury shares to be sold after the power expires."
10 To consider and, if thought fit, to pass the following resolution as a special resolution:
"That the Company be and is hereby generally and unconditionally authorised in accordance with Section 701 of the Act to make one or more market purchases (within the meaning of Section 693(4) of the Act) of its ordinary shares of 5p each provided that:
(c) the maximum price (excluding expenses) which may be paid for an ordinary share shall not be more than 105% of the average market value of the ordinary shares of the Company for the five business days prior to the date the purchase is made; and
(d) unless previously renewed, varied or revoked, the authority hereby conferred shall expire on the conclusion of the next annual general meeting of the Company after the passing of this resolution or, if earlier, 30 September 2014, save that the Company may conclude a contract of purchase before this authority expires that would or might be executed wholly or partly after this authority expires."
"That the articles of association of the Company be amended in the first sentence of Article 147 by deleting the date '2015' and substituting the date '2019'."
By order of the Board
Secretary Northumberland House Princess Square Newcastle upon Tyne NE1 8ER 31 May 2013
In order for a proxy appointment or instruction made by means of CREST to be valid, the appropriate CREST message (a "CREST Proxy Instruction") must be properly authenticated in accordance with Euroclear UK & Ireland Limited's (EUI) specifications and must contain the information required for such instructions, as described in the CREST Manual. The message, regardless of whether it constitutes the appointment of a proxy or an amendment to the instruction given to a previously appointed proxy, must, in order to be valid, be transmitted so as to be received by the issuer's agent (ID RA19) by the latest time(s) for receipt of proxy appointments specified in this notice. For this purpose, the time of receipt will be taken to be the time (as determined by the timestamp applied to the message by the CREST Application Host) from which the issuer's agent is able to retrieve the message by enquiry to CREST in the manner prescribed by CREST. After this time any change of instructions to proxies appointed through CREST should be communicated to the appointee through other means.
CREST members and, where applicable, their CREST sponsors or voting service providers should note that EUI does not make available special procedures in CREST for any particular message. Normal system timings and limitations will therefore apply in relation to the input of CREST Proxy Instructions. It is the responsibility of the CREST member concerned to take (or, if the CREST member is a CREST personal member or sponsored member or has appointed (a) voting service provider(s), to procure that his CREST sponsor or voting service provider(s) take(s)) such action as shall be necessary to ensure that a message is transmitted by means of the CREST system by any particular time. In this connection, CREST members and, where applicable, their CREST sponsors or voting service provider(s) are referred, in particular, to those sections of the CREST Manual concerning practical limitations of the CREST system and timings.
The Company may treat as invalid a CREST Proxy Instruction in the circumstances set out in Regulation 35(5)(a) of the Uncertificated Securities Regulations 2001.
9 Any member attending the meeting has the right to ask questions. Section 319A of the Act requires the Directors to answer any questions raised at the Annual General Meeting which relates to the business of the meeting, although no answer need be given (a) if to do so would interfere unduly with the proceedings of the Annual General Meeting or involve disclosure of confidential information; (b) if the answer has already been given on the Company's website; or (c) if it is undesirable in the best interests of the Company or the good order of the Annual General Meeting that the question be answered.
10 You may not use any electronic address provided either in this Notice or any related documents (including the Form of Proxy) to communicate with the Company for any purposes other than those expressly stated.
KPMG Audit Plc Financial Services Saltire Court 20 Castle Terrace Edinburgh EH1 2EG United Kingdom
Tel +44 (0) 131 222 2000 Fax +44 (0) 131 527 6709 DX 553002 Edinburgh 50
Private & confidential The Directors Northern 3 VCT PLC Northumberland House Princess Square NEWCASTLE UPON TYNE NE18ER
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Contact Catherine Burnet 0131 527 6671
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21 May 2013
Dear Sirs
The circumstances connected with our ceasing to hold office are that our company, KPMG Audit Plc, has instigated an orderly wind down of business. KPMG LLP, an intermediate parent, will seek appointment as statutory auditor.
We request that any correspondence in relation to this statement be sent to our registered office 15 Canada Square, London, E14 5GL marked for the attention of the Audit Regulation Department. $\label{eq:1} \frac{1}{\sqrt{2\pi}\left(1-\frac{1}{2}\right)}\left(\frac{1}{2\pi}\left(1-\frac{1}{2}\right)\right)\left(\frac{1}{2\pi}\left(1-\frac{1}{2}\right)\right)\left(\frac{1}{2\pi}\left(1-\frac{1}{2}\right)\right)\left(\frac{1}{2\pi}\left(1-\frac{1}{2}\right)\right)\left(\frac{1}{2\pi}\left(1-\frac{1}{2}\right)\right)$
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Registered in England No 3110745
Registered office: 15 Canada Square, London, E14 5GL
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Form of Proxy for the Annual General Meeting on 17 July 2013
I/We ……………………………………………………………………………………………………….………………………………………………………
of …………………………………………………………………………………………………………….…………………………………………………….
………………………………………………………………………………………………………………………………….………………………………….
| (block capitals please) | ||
|---|---|---|
| -- | ------------------------- | -- |
being a member of Northern 3 VCT PLC, hereby appoint (see notes 1 and 2)
or failing him/her the chairman of the meeting to be my/our proxy and exercise all or any of my/our rights to attend, speak and vote for me/us in respect of my/our voting entitlement on my/our behalf at the eleventh Annual General Meeting of the Company to be held at 11.30am on 17 July 2013, notice of which was sent to shareholders on 31 May 2013 with the annual report and financial statements for the year ended 31 March 2013, and at any adjournment thereof. The proxy will vote as indicated below in respect of the resolutions set out in the notice of meeting:
| Resolution number |
For | Against | Vote withheld |
|
|---|---|---|---|---|
| 1 | To receive the financial statements for the year ended 31 March 2013 | † | † | † |
| 2 | To declare a final dividend of 3.5p per share in respect of the year ended 31 March 2013 |
† | † | † |
| 3 | To approve the Directors' remuneration report in respect of the year ended 31 March 2013 |
† | † | † |
| 4 | To re-elect Mr C J Fleetwood as a director | † | † | † |
| 5 | To re-elect Mr T R Levett as a director | † | † | † |
| 6 | To appoint KPMG LLP as independent auditor | † | † | † |
| 7 | To authorise the Directors to fix the remuneration of the independent auditor | † | † | † |
| 8 | To authorise the Directors to allot shares pursuant to Section 551 of the Companies Act 2006 |
† | † | † |
| 9 | To disapply Section 561 of the Companies Act 2006 in relation to certain allotments of equity securities |
† | † | † |
| 10 | To authorise the Company to make market purchases of ordinary shares in accordance with Section 701 of the Companies Act 2006 |
† | † | † |
| 11 | To amend the articles of association of the Company | † | † | † |
| † | Please indicate by placing an X in this box if this proxy appointment is one of multiple appointments being made (see note 2 below). |
| Signed: ……………………………………………………………………………… | Date: ………………………………………………2013 |
|---|---|
| ---------------------------------------- | ------------------------------ |
Shareholders who intend to attend the Annual General Meeting are requested to place a tick in the box below in order to assist with administrative arrangements.
| I/we intend to attend the Annual General Meeting at 11.30am on Wednesday 17 July 2013 at the Life Bioscience Centre, Times Square, Newcastle upon Tyne NE1 4EP |
||
|---|---|---|
| Signed: ……………………………………………………………………………… | Date: ………………………………………………2013 |
|---|---|
| ---------------------------------------- | ------------------------------ |
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