Fox in a Box Posted 5 May 2008 Posted 5 May 2008 Milan may in turn pat less than you think for the club given the current state of affairs, read on http://www.investegate.co.uk/Article.aspx?...02131249581789R The Put and Call Options If neither of the conditions set out in paragraphs (a) and (b) above are met then the Ordinary Shareholders will receive £0.10 per Ordinary Share at the time of the exercise of the Call Option by the Investor. Thanks to Louise & FIAB (ME) for finding this (here): Leicester City Football Club PLC13 February 2007 UK Football Investments, LLC (the Investor) 13 February 2007 NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN WHOLE OR IN PART, IN, INTO OR FROM THE UNITED STATES, CANADA, AUSTRALIA OR JAPAN OR ANY OTHER JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OF SUCH JURISDICTION Proposed Subscription by UK Football Investments, LLC for 19,138,432 'A' Ordinary Shares at £0.470258 per share in Leicester City Football Club Plc Put and call option in favour of Ordinary Shareholders Waiver of mandatory offer requirements under Rule 9 of the City Code Adoption of new Articles of Association and Re-registration as a private limited company Summary and Highlights The Board of LCFC and the Investor are pleased to announce the proposed subscription by the Investor for 19,138,432 'A' Ordinary Shares in LCFC at £0.470258 per share, Put and Call Options in favour of existing LCFC Ordinary Shareholders, a waiver of mandatory offer requirements under the City Code, the adoption of New Articles and the re-registration of LCFC as a private limited company. The Proposals are conditional upon LCFC Shareholders passing the Resolutions to be considered at an EGM of LCFC to be held on 9 March 2007. The Investor was formed on 15 February 2002, under a different name, as a limited liability company under the Delaware Limited Liability Company Act with a registered address in care of Corporation Service Company, 2711 Centerville Road, Suite 400, Wilmington, Delaware 19808. Since formation and until completion of the Proposals, it will not have conducted any business or held any assets. The sole Member (owner) of the Investor is Gregg Hawker, Steven N. Frank and Milan Mandaric, in their representative capacity as Trustees of the Milan Mandaric Revocable Trust dated June 24, 1999, as amended. The Investor is managed by the Member. The Subscription If the Proposals are approved, the Investor has agreed to invest approximately £9 million by way of the Subscription. Under the terms of the Subscription Agreement, it will pay the sum of £4,500,000.38, representing fifty per cent. of the Subscription Price, to LCFC on Completion. The balance of the Subscription Price will be paid in full on or before 31 May 2008. Milan Mandaric has agreed to provide a Company Guarantee in respect of the balance of the Subscription Price. The net proceeds from the Subscription will be utilised by LCFC principally for the purpose of improving the playing squad and meeting the working capital requirements of LCFC. Assuming all the Subscription Shares are issued, the Investor will hold slightly in excess of 75 per cent. of the Enlarged Share Capital of LCFC. This will enable it to pass any ordinary or special resolution of LCFC that it wishes, as well as control the Board. The Put and Call Options Under the New Articles, the Ordinary Shareholders of LCFC will grant the Investor an option to purchase all or some of their shares at a price of £0.10 per Ordinary Share (plus any additional consideration that may be payable if certain conditions are met). The Call Option will be exercisable on any number of occasions as the Investor wishes and at any time before 15 August 2010. The additional consideration for the Ordinary Shares will be calculated and payable as follows: (a) if the Club is promoted to the Premier League at the end of any of the 2007/2008 Season, the 2008/2009 Season or the 2009/2010 Season for the next following Season (the 'First Premiership Season'), then the Investor will pay an additional £0.40 per Ordinary Share to the Ordinary Shareholders on 15 August in the year that the Club is promoted to the Premier League; (b) if the Club is promoted to the Premier League at the end of any of the 2007/2008 Season, the 2008/2009 Season or the 2009/2010 Season for the next following Season (the 'First Premiership Season') and the Club remains in the Premier League for the Season immediately following the First Premiership Season (the 'Second Premiership Season'), then the Investor will pay (in addition to the amount specified in paragraph (a) above) an additional £0.50 per Ordinary Share to the Ordinary Shareholders on 15 August in the year that the Club commences its Second Premiership Season. If neither of the conditions set out in paragraphs (a) and (b) above are met then the Ordinary Shareholders will receive £0.10 per Ordinary Share at the time of the exercise of the Call Option by the Investor. If the Club has not been promoted to the Premier League at the end of any of the 2007/2008 Season, the 2008/2009 Season or the 2009/2010 Season and the Investor has not given notice to exercise its Call Option by 15 August 2010 in respect of all of the Existing Ordinary Shares and there has not been a Qualifying Offer, the Ordinary Shareholders shall be deemed to have given notice to the Investor to exercise an option to put all the Ordinary Shares on to the Investor at a price of £0.10 per Ordinary Share. If the Club is promoted to the Premier League, at the end of any of the 2007/ 2008 Season, the 2008/2009 Season or the 2009/2010 Season and the Investor has not given notice to exercise its Call Option by 15 August in the year that the Club achieves promotion to the Premier League in respect of all the Existing Ordinary Shares and there has not been a Qualifying Offer, the Ordinary Shareholders shall be deemed to have given notice to the Investor to exercise an option to put all of their remaining Ordinary Shares on to the Investor at a price of £0.50 per Ordinary Share. In such event, and if the Club remains in the Premier League for the Season immediately following the First Premiership Season, Ordinary Shareholders would also be entitled to receive an additional £0.50 per Ordinary Share on 15 August in the year that the Club commences its second Season in the Premier League. These arrangements therefore provide Ordinary Shareholders with a return or partial return of their investment by 29 August 2010. Ordinary Shareholders will receive a minimum of £0.10 per Ordinary Share unless the Club has attained a place in the Premier League at the end of the 2007/2008 Season, the 2008/2009 Season or the 2009/2010 Season. As provided for above, further consideration will also be payable if the Club remains in the Premier League for the following Season. The Ordinary Shareholders will not otherwise participate in any future gains or losses on their shares. As security for the performance of the Investor's obligations under the Call Option and the Put Option, Milan Mandaric has agreed to provide an Ordinary Shareholder Guarantee. This guarantee is by Milan Mandaric and not a UK bank and therefore in the event of any default, Ordinary Shareholders' principal remedy would be to take proceedings against Milan Mandaric to recover any sums due under the Ordinary Shareholder Guarantee. The Takeover Code Under Rule 9 of the Takeover Code, any person who acquires an interest (as defined in the Takeover 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 Takeover Code, that person is normally required to make a general offer to all remaining shareholders to acquire their shares. Similarly, where any person, together with persons acting in concert with him, is interested in shares which in aggregate carry not less than 30 per cent. of the voting rights of a company, but does not hold shares carrying more than 50 per cent. of the voting rights of the company, a general offer will normally be required if any further interest in shares are acquired by any such person. An offer under Rule 9 must be made in cash and at the highest price paid per share by the person required to make the offer, or any person acting in concert with him, for any interest in shares of the company acquired during the 12 months prior to the announcement of the offer. The members of the Concert Party are deemed to be acting in concert for the purpose of the Takeover Code. Immediately following the Subscription, the members of the Concert Party will hold shares representing slightly in excess of 75 per cent. of the voting rights of the Enlarged Share Capital, all of which would be held by the Investor. The Panel has agreed, subject to the passing of Resolution 1 at the EGM on a poll by independent holders of Existing Ordinary Shares, to waive the obligation on the members of the Concert Party to make a general offer to Shareholders under Rule 9 of the Takeover Code that would otherwise arise as a result of the implementation of the Proposals. To be passed, a simple majority of the votes must be cast in favour of Resolution 1 at the EGM. Following completion of the Proposals, the Investor will hold more than 50 per cent. of the Company's voting share capital and therefore for so long as it continues to hold more than 50 per cent. of the Company's voting share capital, the Investor, and also members of its concert party, may accordingly be able to increase its aggregate interests in shares without incurring any obligation under Rule 9 to make a general offer, although the Trust and the Member will not individually be able to acquire shares in the Company which would individually take them through a Rule 9 threshold without Panel consent. The Investor has agreed to regulate this situation through the structure of the Put and Call Options. Furthermore, there is no agreement, arrangement or undertaking between the members of the Concert Party pursuant to which any of the Subscription Shares or the Existing Ordinary Shares will be transferred by the Investor to either the Member or the Trust. Re-registration At the EGM, a resolution will be proposed to re-register the Company as a private limited company to take advantage of the greater flexibility and lower level of regulation applicable to private companies which is appropriate where a single shareholder controls 75 per cent. of the voting capital of a company. The Re-registration process requires certain consequential changes to be made to the memorandum of association of the Company and accordingly a further resolution will be proposed at the EGM to approve such changes. The Takeover Code will continue to apply to the Company if it is re-registered as a private limited company until the date which is ten years from 22 January 2003 being the date on which the Company issued a prospectus offering 4,750,000 £1 ordinary shares at £1 per share to Shareholders. Financial effects of the Proposals Upon the Proposals becoming effective Ordinary Shareholders will be entitled to receive a minimum of £0.10 per £1 Ordinary Share under either the Call Option or the Put Option, such funds to be received by 29 August 2010. The Subscription provides that the Company will receive approximately £9 million. Each Subscription Share will have a nominal value of £0.01 each but in all other material respects as regards entitlement to voting, dividend and participation in the capital of the Company will be equivalent to an Existing Ordinary Share. Recommendation The Directors believe that the Proposals, and in particular the proposed Subscription and the securing of the waiver from the obligation on the Concert Party to make a general offer to shareholders under Rule 9 of the Takeover Code, are in the best interests of the Company and its shareholders as a whole. In providing advice to the Directors, Vantis has taken into account the commercial assessment of the Directors. Vantis' advice to the Board is set out in Part III of the document that will be sent to Shareholders. Accordingly, the Directors unanimously recommend that Shareholders vote in favour of the Resolutions as they themselves have undertaken to do in respect of their own beneficial holdings which amount, in aggregate, to 6,024,476 Ordinary Shares, representing approximately 94.44 per cent. of the Existing Ordinary Shares. In addition, LCFC has received irrevocable undertakings to vote in favour of the Resolutions as follows: Name Number of Existing % of issued Existing Ordinary Shares Ordinary Shares Capital Charles Street Buildings (Leicester) Ltd 100,000 1.57 Karen and Peter Swann 100,000 1.57 J M McCahill Ltd 50,000 0.78 C J Upton & Sons Ltd 20,000 0.31 Timothy Bevan Davies 100,000 1.57 Pukka Pies Limited 500,000 7.84 Roger William Paltney 85,000 1.33 Anthony James Carpendale Wheeler 100,000 1.57 Martin Francis George 50,000 0.78 Alison Jenny Nettleton 25,000 0.39 Kerby & West 250,000 3.92 Clive Richard Sharpe 100,000 1.57 Peter John Lennon 35,000 0.55 Brian Raymond Maddison 110,000 1.72 Kenneth Raymond Brigstock 25,000 0.39 James Columba McCahill 200,000 3.14 Thomas Ellison Bloor 25,000 0.39 Anthony Wayne Lander 25,000 0.39 Walker McRobie 50,000 0.78 Stephen John Spencer Lee 200,000 3.14 Teresa Ann Lander 25,000 0.39 Peter William Freer 50,000 0.78 Robert Comrie Burns Craig 100,000 1.57 Vanda Alicia Craig 25,000 0.39 Martin John Page 60,000 0.94 Alan James Upton 100,000 1.57 Nicholas Charles Wilkinson 100,000 1.57 A M Widdowson & Son Ltd 250,000 3.92 Peter Eugene Hockenhull 125,000 1.96 David Wilson 150,000 2.35 Michael John Edwards 250,000 3.92 Donald Kendall 100,000 1.57 Roger Thomas Page 60,000 0.94 Hammond Grange Ltd 500,000 7.84 Leicester City Supporters Society Ltd 151,000 2.37 The Executors of Trevor Bennett 350,000 5.49 Jonathan Ray Holmes 100,000 1.57 David Peter John Ross 165,476 2.59 H W Coates Ltd 300,000 4.70 Emile Williams Heskey 50,000 0.78 Gary Lineker 100,000 1.57 Andrew Taylor 250,000 3.92 Gregory Alison Clarke 413,000 6.47 Dominic Shorthouse 100,000 1.57 6,024,476 94.44 In addition, the Company has received an irrevocable undertaking from T-C Sports Co,Inc to vote in favour of the Resolutions at the EGM in respect of the one Redeemable Share held by it. Accordingly, irrevocable undertakings to vote in favour of the Resolutions have been received from Shareholders with an interest in shares, representing in aggregate 94.44 per cent. of the existing issued share capital of the Company. Commenting on the Proposals, Milan Mandaric said: 'We are all aware of the difficulties faced by the Club at this moment and in particular its precarious position in the Championship. Consequently, the Club is facing a pivotal time over the coming months. The Foxes have a long and proud history and I believe under new ownership and direction it will be possible to build the Club back up and restore it to its rightful position playing amongst the top flight of clubs in the UK and Europe as it did in 2004 and before. I believe this will reward the fans for their loyalty and support during recent difficult times. My involvement and success at Portsmouth has been well publicised and I remain proud of my achievements there. In making the proposed investment, my aim is to draw upon my experience and skills to replicate that success with Leicester City' Jim McCahill, Chairman of LCFC, said: 'In 2003 the Club regained its status as a Premier League team but unfortunately was relegated to the Championship the following season where it has remained. Over the past several years the Club has invested in its infrastructure as evidenced by a stadium of Premier League standard and extensive training, medical and youth academy facilities. The Board has considered the position of the Company and has concluded that a significant injection of funds is required to take it forward and secure its future with the express aim of a swift return to the Premier League. The Board has for some time been actively exploring opportunities to attract investment into the Club. The Board has investigated rights issues, met with potential new investors and explored the benefits of a major investor. Through the proposals that Milan Mandaric has submitted, the Investor will inject a minimum of £9 million over an initial 15 month period; a significant investment and one that should be considered against the background of the £2.2m raised from new investors and rights issues in the near 4 years since the Club emerged from administration and the absence of any other concrete proposals to take the Club forward. The Board considers that because there are no other reasonably practicable proposals available to the Club, and recognising that many Ordinary Shareholders are likely to have subscribed for Ordinary Shares to support the Club rather than investing for or in the expectation of financial gain, the Proposals are in the interests of both the Club and Shareholders. Shareholders will be aware that three directors, James Johnson, Andrew Taylor and Greg Clarke, have recently resigned from the Board because they felt unable to recommend the Proposals. However, they wish the Club well and have no intention of acting contrary to the best interests of the Club. The Board again wishes to place on record its appreciation of the enormous contribution made to the Club by James, Andrew and Greg both as loyal and passionate supporters and also during their time as directors. The Board believes that, with Milan Mandaric's backing, Leicester City Football Club will again be able to challenge for promotion to the Premier League.' This summary should be read in conjunction with the full text of the following announcement and the Appendices. Appendix 1 sets out summaries of further terms in relation to the Proposals. Appendix 2 contains source notes relating to certain information contained in this announcement. Appendix 3 contains details of the irrevocable undertakings received in relation to the Proposals. Certain terms used in this announcement are defined in Appendix 4 to this announcement. Enquiries: For LCFC and the Investor: Rachel Civey 07962 652036 Jon Dale 07739 852791 Vantis, which is authorised and regulated in the United Kingdom by the Financial Services Authority, is acting for LCFC in connection with the Proposals and no one else and will not be responsible to anyone other than LCFC for providing the protections afforded to clients of Vantis nor for providing advice in relation to the Proposals or any matter referred to herein. This announcement is not intended to and does not constitute or form any part of, an offer to sell or an invitation to purchase or the solicitation of an offer to subscribe for any securities or the solicitation of any vote or approval in any jurisdiction pursuant to the Proposals or otherwise. The Proposals will be made solely through the document and the notice of Extraordinary General Meeting, which will together contain the full terms and conditions of the Proposals, including details of how to vote in favour of the Resolutions. Any response to the Proposals should be made only on the basis of the information contained in the document and notice of Extraordinary General Meeting. The distribution of this announcement in jurisdictions other than the UK may be restricted by law and therefore any persons who are subject to the laws of any jurisdiction other than the UK should inform themselves about, and observe, any applicable requirements. In particular, the Offer is not being made, directly or indirectly, in the United States, Canada, Australia or Japan. This announcement has been prepared for the purpose of complying with English law and the Code and the information disclosed may not be the same as that which would have been disclosed if this announcement had been prepared in accordance with the laws of jurisdictions outside England. This announcement, including information included or incorporated by reference in this announcement, may contain 'forward-looking statements' concerning the Investor and LCFC. Generally, the words 'will', 'may', 'should', 'continue','believes', 'expects', 'intends', 'anticipates' or similar expressions identify forward-looking statements. The forward-looking statements involve risks and uncertainties that could cause actual results to differ materially from those expressed in the forward-looking statements. Many of these risks and uncertainties relate to factors that are beyond the companies' abilities to control or estimate precisely, such as future market conditions and behaviours of other market participants, and therefore undue reliance should not be placed on such statements. The Investor and LCFC assume no obligation and do not intend to update these forward-looking statements, except as required pursuant to applicable law. Dealing disclosure requirements Under the provisions of Rule 8.3 of the Code, if any person is, or becomes,'interested' (directly or indirectly) in 1 per cent. or more of any class of'relevant securities' of the Investor or LCFC, all 'dealings' in any 'relevant securities' of those companies (including by means of an option in respect of, or a derivative referenced to, any such 'relevant securities') must be publicly disclosed by no later than 3.30 p.m. (London time) on the Business Day following the date of the relevant transaction. This requirement will continue until the date on which the Proposals become, or are declared, unconditional, lapse or are otherwise withdrawn. If two or more persons act together pursuant to an agreement or understanding, whether formal or informal, to acquire an 'interest' in 'relevant securities' of the Investor or of LCFC, they will be deemed to be a single person for the purpose of Rule 8.3. Under the provisions of Rule 8.1 of the Code, all 'dealings' in 'relevant securities' of the Investor or of LCFC by the Investor or LCFC, or by any of their respective 'associates', must be disclosed by no later than 12.00 noon (London time) on the London business day following the date of the relevant transaction. A disclosure table, giving details of the companies in whose 'relevant securities' 'dealings' should be disclosed, and the number of such securities in issue, can be found on the Panel's website at www.thetakeoverpanel.org.uk. 'Interests in securities' arise, in summary, when a person has long economic exposure, whether conditional or absolute, to changes in the price of securities. In particular, a person will be treated as having an 'interest' by virtue of the ownership or control of securities, or by virtue of any option in respect of, or derivative referenced to, securities. Terms in quotation marks are defined in the Code, which can also be found on the Panel's website. If you are in any doubt as to whether or not you are required to disclose a 'dealing' under Rule 8, you should consult the Panel. NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN WHOLE OR IN PART, IN, INTO OR FROM THE UNITED STATES, CANADA, AUSTRALIA OR JAPAN OR ANY OTHER JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OF SUCH JURISDICTION 13 February 2007 Proposed Subscription by UK Football Investments, LLC for 19,138,432 'A' Ordinary Shares at £0.470258 per share Put and call option in favour of Ordinary Shareholders Waiver of mandatory offer requirements under Rule 9 of the City Code Adoption of new Articles of Association and Re-registration as a private limited company 1. Introduction The Board of LCFC and the Investor are pleased to announce the proposed subscription by the Investor for 19,138,432 'A' Ordinary Shares in LCFC at £0.470258 per share, Put and Call Options in favour of existing LCFC Ordinary Shareholders, a waiver of mandatory offer requirements under the City Code, the adoption of New Articles and the re-registration of LCFC as a private limited company. The Proposals are conditional upon LCFC Shareholders passing the Resolutions to be considered at an EGM of LCFC to be held on 9 March 2007. 2. Summary of the Proposals The Proposals, which are conditional upon Shareholders passing the Resolutions at the EGM convened for 10.00 a.m. on 9 March 2007, and to the conditions and further terms set out below and in Appendix 1 to this announcement and the full terms and conditions which will be set out in the circular to LCFC Shareholders, are as follows: a) The Investor has agreed to invest approximately £9 million by way of the Subscription. Under the terms of the Subscription Agreement, the Investor will pay the sum of £4,500,000.38, representing fifty per cent. of the Subscription Price, to the Company on Completion. The balance of the Subscription Price will be paid in full on or before 31 May 2008. Milan Mandaric has agreed to provide the Company Guarantee in respect of the balance of the Subscription Price. The net proceeds from the Subscription will be utilised by the Company principally for the purpose of improving the playing squad and meeting the working capital requirements of LCFC. The Company is proposing to allot, by way of the Subscription, the Subscription Shares to the Investor. The Subscription Shares will have certain rights in addition to the rights currently enjoyed by the holders of the Existing Ordinary Shares. In addition to the Put and Call Option described in the next section below, the holders of the Subscription Shares will have the right to appoint (by notice in writing) as many directors of the Company as it wishes and the right to 'drag-along' the holders of the Existing Ordinary Shares on a Qualifying Offer. b) Under the New Articles, the Ordinary Shareholders will grant the Investor an option to purchase all or some of their shares at a price of £0.10 per Ordinary Share (plus any additional consideration that may be payable if certain conditions are met). The Call Option will be exercisable on any number of occasions as the Investor wishes and at any time before 15 August 2010. The additional consideration for the Ordinary Shares will be calculated and payable as follows: i. if the Club is promoted to the Premier League at the end of any of the 2007/2008 Season, the 2008/2009 Season or the 2009/2010 Season for the next following Season (the ' First Premiership Season'), then the Investor will pay an additional £0.40 per Ordinary Share to the Ordinary Shareholders on 15 August in the year that the Club is promoted to the Premier League; ii. if the Club is promoted to the Premier League at the end of any of the 2007/2008 Season, the 2008/2009 Season or the 2009/2010 Season for the next following Season (the 'First Premiership Season') and the Club remains in the Premier League for the Season immediately following the First Premiership Season (the 'Second Premiership Season'), then the Investor will pay (in addition to the amount specified in paragraph (a) above) an additional £0.50 per Ordinary Share to the Ordinary Shareholders on 15 August in the year that the Club commences its Second Premiership Season. If neither of the conditions set out in paragraphs (i) and (ii) above are met then the Ordinary Shareholders will receive £0.10 per Ordinary Share at the time of the exercise of the Call Option by the Investor. If the Club has not been promoted to the Premier League at the end of any of the 2007/2008 Season, the 2008/2009 Season or the 2009/2010 Season and the Investor has not given notice to exercise its Call Option by 15 August 2010 in respect of all of the Existing Ordinary Shares and there has not been a Qualifying Offer, the Ordinary Shareholders shall be deemed to have given notice to the Investor to exercise an option to put all the Ordinary Shares on to the Investor at a price of £0.10 per Ordinary Share. If the Club is promoted to the Premier League, at the end of any of the 2007/ 2008 Season, the 2008/2009 Season or the 2009/2010 Season and the Investor has not given notice to exercise its Call Option by 15 August in the year that the Club achieves promotion to the Premier League in respect of all the Existing Ordinary Shares and there has not been a Qualifying Offer, the Ordinary Shareholders shall be deemed to have given notice to the Investor to exercise an option to put all of their remaining Ordinary Shares on to the Investor at a price of £0.50 per Ordinary Share. In such event, and if the Club remains in the Premier League for the Season immediately following the First Premiership Season, Ordinary Shareholders would also be entitled to receive an additional £0.50 per Ordinary Share on 15 August in the year that the Club commences its second Season in the Premier League. These arrangements therefore provide Ordinary Shareholders with a return or partial return of their investment by 29 August 2010. Ordinary Shareholders will receive a minimum of £0.10 per Ordinary Share unless the Club has attained a place in the Premier League at the end of the 2007/2008 Season, the 2008/2009 Season or the 2009/2010 Season. As provided for above, further consideration will also be payable if the Club remains in the Premier League for the following Season. The Ordinary Shareholders will not otherwise participate in any future gains or losses on their shares. c) The members of the Concert Party are deemed to be acting in concert for the purpose of the Takeover Code. Immediately following the Subscription, the members of the Concert Party will hold shares representing slightly in excess of 75 per cent. of the voting rights of the Enlarged Share Capital, all of which would be held by the Investor. The Panel has agreed, subject to the passing of Resolution 1 at the EGM on a poll by independent holders of Existing Ordinary Shares, to waive the obligation on the members of the Concert Party to make a general offer to Shareholders under Rule 9 of the Takeover Code that would otherwise arise as a result of the implementation of the Proposals. To be passed, a simple majority of the votes must be cast in favour of Resolution 1 at the EGM. Following completion of the Proposals, the Investor will hold more than 50 per cent. of the Company's voting share capital and therefore for so long as it continues to hold more than 50 per cent. of the Company's voting share capital, the Investor, and also members of its concert party, may accordingly be able to increase its aggregate interests in shares without incurring any obligation under Rule 9 to make a general offer, although the Trust and the Member will not individually be able to acquire shares in the Company which would individually take them through a Rule 9 threshold without Panel consent. The Investor has agreed to regulate this situation through the structure of the Put and Call Options. Furthermore, there is no agreement, arrangement or undertaking between the members of the Concert Party pursuant to which any of the Subscription Shares or the Existing Ordinary Shares will be transferred by the Investor to either the Member or the Trust. d) As part of the Proposals, Shareholders are being asked to approve the adoption of the New Articles which will, inter alia, set out the terms of the Call Option and the Put Option which will provide Ordinary Shareholders with a return or partial return of their investment within approximately four years from Completion. A summary of the proposed amendments contained in the New Articles is set out in the circular to LCFC Shareholders. e) At the EGM, a resolution will be proposed to re-register the Company as a private limited company to take advantage of the greater flexibility and lower level of regulation applicable to private companies which is appropriate where a single shareholder controls 75 per cent. of the voting capital of a company. The Re-registration process requires certain consequential changes to be made to the memorandum of association of the Company and accordingly a further resolution will be proposed at the EGM to approve such changes. The Takeover Code will continue to apply to the Company if it is re-registered as a private limited company until the date which is ten years from 22 January 2003 being the date on which the Company issued a prospectus offering 4,750,000 £1 ordinary shares at £1 per share to Shareholders Upon the Proposals becoming effective Ordinary Shareholders will be entitled to receive a minimum of £0.10 per £1 Ordinary Share under either the Call Option or the Put Option, such funds to be received by 29 August 2010. The Subscription provides that the Company will receive approximately £9 million. Each Subscription Share will have a nominal value of £0.01 each but in all other material respects as regards entitlement to voting, dividend and participation in the capital of the Company will be equivalent to an Existing Ordinary Share. Net assets per Ordinary Share at 30 November 2006 based on the unaudited results for the six months to that date, which are not an indicative valuation of the Ordinary Shares, prior to the Subscription are approximately 24 pence. Net assets per share following the Subscription, after aggregating Ordinary and Subscription Shares, will be approximately 41.3 pence. 3. Irrevocable undertakings LCFC has received irrevocable undertakings to vote in favour of the Resolutions in respect of a total of 6,024,477 LCFC shares representing, in aggregate, 94.44 per cent. of the existing issued share capital of LCFC, comprised as follows: (a) from each of the LCFC Directors (and certain members of their immediate families) in respect of their entire beneficial holdings which amount, in aggregate, to 425,000 Ordinary Shares representing approximately 6.7 per cent. of the existing issued share capital of LCFC; and (b) from the following Ordinary Shareholders: Name Number of Existing % of issued Existing Ordinary Shares Ordinary Shares Capital Charles Street Buildings (Leicester) Ltd 100,000 1.57 Karen and Peter Swann 100,000 1.57 J M McCahill Ltd 50,000 0.78 C J Upton & Sons Ltd 20,000 0.31 Pukka Pies Limited 500,000 7.84 Roger William Paltney 85,000 1.33 Martin Francis George 50,000 0.78 Alison Jenny Nettleton 25,000 0.39 Kerby & West 250,000 3.92 Clive Richard Sharpe 100,000 1.57 Peter John Lennon 35,000 0.55 Brian Raymond Maddison 110,000 1.72 Kenneth Raymond Brigstock 25,000 0.39 Thomas Ellison Bloor 25,000 0.39 Walker McRobie 50,000 0.78 Stephen John Spencer Lee 200,000 3.14 Teresa Ann Lander 25,000 0.39 Peter William Freer 50,000 0.78 Robert Comrie Burns Craig 100,000 1.57 Vanda Alicia Craig 25,000 0.39 Martin John Page 60,000 0.94 Alan James Upton 100,000 1.57 Nicholas Charles Wilkinson 100,000 1.57 A M Widdowson & Son Ltd 250,000 3.92 Peter Eugene Hockenhull 125,000 1.96 David Wilson 150,000 2.35 Michael John Edwards 250,000 3.92 Donald Kendall 100,000 1.57 Roger Thomas Page 60,000 0.94 Hammond Grange Ltd 500,000 7.84 Leicester City Supporters Society Ltd 151,000 2.37 The Executors of Trevor Bennett 350,000 5.49 Jonathan Ray Holmes 100,000 1.57 David Peter John Ross 165,476 2.59 H W Coates Ltd 300,000 4.70 Emile Williams Heskey 50,000 0.78 Gary Lineker 100,000 1.57 Andrew Taylor 250,000 3.92 Gregory Alison Clarke 413,000 6.47 Dominic Shorthouse 100,000 1.57 5,599,476 87.77 © In addition, the Company has received an irrevocable undertaking from T-C Sports Co,Inc to vote in favour of the Resolutions at the EGM in respect of the one Redeemable Share held by it. Further details of these irrevocable undertakings are set out in Appendix 3. 4. Background to and reasons for the Proposals In 2003 the Club regained its status as a Premier League team but unfortunately was relegated to the Championship the following season where it has remained. Over the past several years the Club has invested in its infrastructure as evidenced by a stadium of Premier League standard and extensive training, medical and youth academy facilities. The Board has considered the position of the Company and has concluded that a significant injection of funds is required to take it forward and secure its future with the express aim of a swift return to the Premier League. The Board has for some time been actively exploring opportunities to attract investment into the Club. The Board has investigated rights issues, met with potential new investors and explored the benefits of a major investor. Through the proposals that Milan Mandaric has submitted, the Investor will inject a minimum of £9 million over an initial 15 month period; a significant investment and one that should be considered against the background of the £2.2m raised from new investors and rights issues in the near 4 years since the Club emerged from administration and the absence of any other concrete proposals to take the Club forward. The Board considers that because there are no other reasonably practicable proposals available to the Club, and recognising that many Ordinary Shareholders are likely to have subscribed for Ordinary Shares to support the Club rather than investing for or in the expectation of financial gain, the Proposals are in the interests of both the Club and Shareholders. Shareholders will be aware that three directors, James Johnson, Andrew Taylor and Greg Clarke, have recently resigned from the Board because they felt unable to recommend the Proposals. However, they wish the Club well and have no intention of acting contrary to the best interests of the Club. The Board again wishes to place on record its appreciation of the enormous contribution made to the Club by James, Andrew and Greg both as loyal and passionate supporters and also during their time as directors. The Board believes that, with Milan Mandaric's backing, Leicester City Football Club will again be able to challenge for promotion to the Premier League. 5. Recommendation The Directors believe that the Proposals, and in particular the proposed Subscription and the securing of the waiver from the obligation on the Concert Party to make a general offer to shareholders under Rule 9 of the Takeover Code, are in the best interests of the Company and its shareholders as a whole. In providing advice to the Directors, Vantis has taken into account the commercial assessment of the Directors. Vantis' advice to the Board is set out in the document that will be sent to Shareholders. Accordingly, the Directors unanimously recommend that Shareholders vote in favour of the Resolutions as they themselves have undertaken to do in respect of their own beneficial holdings which amount, in aggregate, to 425,000 Ordinary Shares, representing approximately 6.7 per cent. of the Existing Ordinary Shares. 6. Information on the Investor UK Football Investments, LLC was formed on 15 February 2002, under a different name, as a limited liability company under the Delaware Limited Liability Company Act with a registered address in care of Corporation Service Company, 2711 Centerville Road, Suite 400, Wilmington, Delaware 19808. The file number of the Investor is 3492527. The Investor recently changed its name to UK Football Investments, LLC. Since formation and until completion of the Proposals, the Investor will not have conducted any business or held any assets. The sole Member (owner) of the Investor is Gregg Hawker, Steven N. Frank and Milan Mandaric, in their representative capacity as Trustees of the Milan Mandaric Revocable Trust dated June 24, 1999, as amended. The Investor is managed by the Member. Gregg Hawker has been practising as a Certified Public Accountant in the USA for the last 32 years, 3 years of which were at Grant Thornton, Chicago and 5 years of which were at Grant Thornton, San Jose and thereafter as sole proprietor of his own practice in California specialising in tax and financial consultation for small business. Gregg has a degree in accounting from the University of Illinois. Steve Frank graduated from the St Louis University School of Law in 1973 and has since practised as a lawyer in both private practice and for large companies. He was a partner at Peper, Martin, Jensen, Maichel & Hetlage between 1988 and 1992 and was then appointed Associate General Counsel, Vice President and Corporate Secretary at McDonnell Douglas Corporation until 1997 followed by a brief spell at Boeing after its acquisition of the company in 1997. He subsequently joined Plancorp Inc. where he is currently a partner, board member and Executive Vice-President where he provides advice on business planning, corporate finance, estate planning, mergers and acquisitions and general financial management. In addition, Steve has been active in the footballing world throughout his life including being a member of the United States football team in World Cup qualifying matches in the 1970s. Milan Mandaric was born in the Serbian city of Novi Sad, Vojvodina. By the age of 26 Mandaric had turned his father's machine shop into one of the largest businesses in the country, mass producing spare car parts. In 1969 Milan moved to the United States where he became a partner in a firm that manufactured computer components in California before starting his computer component company, Lika Corporation, in 1971 which was later sold to Tandy corporation. He then founded Sanmina, a backpanel-assembly manufacturing company where he remained until 1994 when he resigned to become chairman of Elexsys (formerly Diceon Electronics) an electronics component company. In 1997 he merged Elexsys with Sanmina. Milan has also been involved in various investment companies including Behrman Capital and Serbian businesses such as Razvojna Banka. Milan's love of football led him to the set up F.C. Lika and San Jose Earthquakes in the United States. In 1998 Milan took over Portsmouth football club and in 3 years had transformed the club from perennial strugglers in the second tier of English football into an established Premier League club. The funds payable by the Investor in connection with the Subscription will be funded from the resources of the Trust. 7. Information relating to LCFC The Company was formed on 18 November 2002 and on 22 January 2003 issued a prospectus offering 4,750,000 Ordinary Shares at £1 per share to Shareholders for the purpose of the Company acquiring the assets and goodwill of the Club from the administrators of the companies then operating the Club and to enter into a lease of the Stadium. This offer for subscription was subscribed as to 4,200,000 shares and there have been subsequent issues of Ordinary Shares at £1 per share taking the issued ordinary share capital to 6,379,476 Ordinary Shares. In addition one Redeemable Share has been issued to T-C Sports who lease the Stadium to the Company. The Company has operated the Stadium and the training ground since February 2003. The activities of the Company include football, restaurant, conference and banqueting facilities, events, its football academy and community projects. 8. Current trading and prospects The unaudited results of the Company for the six months ended 30 November 2006 show a loss before tax for the period of £3.6 million (6 months ended 30 November 2005:-loss £120,000;year ended 31 May 2006: profit-£1.6 million). The Board believes that the Company requires a significant injection of funds if it is to improve its Championship position and have a prospect of challenging for promotion to the Premier League. In addition, the net assets of the Company are now less than half the amount of its called up share capital. In such circumstances, the Directors are obliged by Section 142 of the Act to convene an extraordinary general meeting for the purpose of considering whether, and if so what, steps should be taken to deal with the situation. If they are approved by Shareholders, the Proposals will address this situation. 9. Management and employees All Directors have agreed to step down immediately upon Completion save for Malcolm Stewart-Smith, who will remain as a Non-Executive Director and representative of T-C Sports, and Tony Lander. Milan Mandaric will assume the position of Executive Chairman. Whilst Tim Davies will resign as a Director, he will continue his role as Chief Executive Officer of the Company. The Investor may exercise its right under the New Articles to appoint a majority of the board of Directors as it deems appropriate for the successful running of the Company. Upon his appointment as Chairman, Mr Mandaric intends to work with the existing management of the Club in the development of the Club going forward and will conduct a strategic review of all aspects of the Club following Completion, including its finances, operations and commercial development with a view to improving the way the Club is run at all levels. Whilst the Investor has no immediate plans which would impact on arrangements with employees off the field, in view of the urgent need to improve the Club's performance on the pitch and to avoid any danger of relegation, Mr Mandaric will, immediately following despatch of this document and in anticipation of taking control of the Club, meet with senior management to review the immediate needs of the team. This may involve possible changes to the team and strengthening of its football management, including taking on additional quality players. On behalf of the Investor, Mr Mandaric has, however, given assurances to the current directors that the existing employment rights of all management and employees of the Company will be honoured and pensions obligations complied with. The Investor has no plans to dispose of the Stadium which is the subject of a purchase agreement with T-C Sports Co, Inc. The Stadium is shown in the Company's financial statements at depreciated historical cost and at 30 November 2006 this was a figure of £17,716,000. The Directors have been advised by the Company's valuers that because of its specialised nature there is no open market value for its existing use. It has a depreciated replacement cost of approximately £42 million. This depreciated replacement cost merely represents an estimate of what it would in theory cost at current prices to purchase the land and build the Stadium, less the depreciation of the buildings. Given the Investor's stated intentions regarding the Stadium, the valuations are not in the opinion of the Directors relevant to their assessment of the Proposals. 10. Disclosure of interests in LCFC shares As at the date of this announcement, other than under the Subscription, neither the Investor nor any persons deemed to be acting in concert with the Investor has any interests, rights to subscribe in or short positions (whether conditional or absolute and whether in the money or otherwise),in the Existing Ordinary Shares. There have been no shares in the Company borrowed or lent by either the Investor or any persons deemed to be acting in concert with the Investor. 11. General Your attention is drawn to the further information contained in the Appendices which form part of this announcement. The summaries of further terms in relation to the Proposals set out in Appendix 1 to this announcement form part of, and should be read in conjunction with, this announcement. Appendix 2 to this announcement provides details of additional information regarding the Offer, including the basis of calculations and sources of certain information included in this announcement. Appendix 3 to this announcement contains details of the irrevocable undertakings received in relation to the Proposals. Appendix 4 to this announcement contains definitions of certain terms used in this announcement. The circular setting out the terms and conditions of the Proposals is expected to be posted to LCFC Shareholders later today and must, in any event, be posted to Shareholders not later than 28 days after the date of this announcement unless otherwise agreed with the Panel. Enquiries: For LCFC and the Investors: Rachel Civey 07962 652036 Jon Dale 07739 852791 Vantis, which is authorised and regulated in the United Kingdom by the Financial Services Authority, is acting for LCFC in connection with the Proposals and no one else and will not be responsible to anyone other than LCFC for providing the protections afforded to clients of Vantis nor for providing advice in relation to the Proposals or any matter referred to herein. This announcement is not intended to and does not constitute or form any part of, an offer to sell or an invitation to purchase or the solicitation of an offer to subscribe for any securities or the solicitation of any vote or approval in any jurisdiction pursuant to the Proposals or otherwise. The Proposals will be made solely through the document and the notice of Extraordinary General Meeting, which will together contain the full terms and conditions of the Proposals, including details of how to vote in favour of the Resolutions. Any response to the Proposals should be made only on the basis of the information contained in the document and notice of Extraordinary General Meeting. The distribution of this announcement in jurisdictions other than the UK may be restricted by law and therefore any persons who are subject to the laws of any jurisdiction other than the UK should inform themselves about, and observe, any applicable requirements. In particular, the Offer is not being made, directly or indirectly, in the United States, Canada, Australia or Japan. This announcement has been prepared for the purpose of complying with English law and the Code and the information disclosed may not be the same as that which would have been disclosed if this announcement had been prepared in accordance with the laws of jurisdictions outside England. This announcement, including information included or incorporated by reference in this announcement, may contain 'forward-looking statements' concerning the Investor and LCFC. Generally, the words 'will', 'may', 'should', 'continue','believes', 'expects', 'intends', 'anticipates' or similar expressions identify forward-looking statements. The forward-looking statements involve risks and uncertainties that could cause actual results to differ materially from those expressed in the forward-looking statements. Many of these risks and uncertainties relate to factors that are beyond the companies' abilities to control or estimate precisely, such as future market conditions and behaviours of other market participants, and therefore undue reliance should not be placed on such statements. The Investor and LCFC assume no obligation and do not intend to update these forward-looking statements, except as required pursuant to applicable law. Dealing disclosure requirements Under the provisions of Rule 8.3 of the Code, if any person is, or becomes,'interested' (directly or indirectly) in 1 per cent. or more of any class of'relevant securities' of the Investor or LCFC, all 'd
SamL Posted 5 May 2008 Posted 5 May 2008 Wouldn't it have been best to post the key points? Can't be bothered to trawl through the whole of that.
act smiley Posted 5 May 2008 Posted 5 May 2008 Facts at last! Mind giving a summary? Far too lazy for this reading lark. Pfah, have to do it myself then: I'm no expert but from that it looks to me like: £3.6m 6-month operating loss during the 06/07 season. £9m additional investment over 2 seasons. Total of 6.3 million shares, of which 6 million shares voted in favour of selling to Mandaric. Purchase of 6 million shares at 10p each, additional 40p per share on promotion to premier league within 3 seasons... so 10p a share, so its £600,000. So Steve Howard is worth twice what the club is?
Fox in a Box Posted 5 May 2008 Author Posted 5 May 2008 This is what was braodcast on 14th Feb 2007 when the bid was put to the city of london.... All the truth you need. Milan knows its in the public domain too.
davieG Posted 5 May 2008 Posted 5 May 2008 It's been in this topic for the last 15 Months http://www.foxestalk.co.uk/forums/index.ph...st&p=535381. Here's an abridged version. http://www.foxestalk.co.uk/forums/index.ph...st&p=535467
davieG Posted 5 May 2008 Posted 5 May 2008 This is what was braodcast on 14th Feb 2007 when the bid was put to the city of london....All the truth you need. Milan knows its in the public domain too. So why are you suddenly starting a new thread on it?
Fox in a Box Posted 5 May 2008 Author Posted 5 May 2008 So why are you suddenly starting a new thread on it? so people get a handle on what milan has done for the club ...all im hearing is crap on the radio stayings hes paid this that and the other.. so people can have a reality check, smell the coffee.
dandannieldanok Posted 5 May 2008 Posted 5 May 2008 What a load of boring tripe, Mandaric is the majority owner, end of story until told different.
davieG Posted 5 May 2008 Posted 5 May 2008 so people get a handle on what milan has done for the club ...all im hearing is crap on the radio stayings hes paid this that and the other..so people can have a reality check, smell the coffee. All it tells us is that he got us for peanuts! Even less now we've been relegated.
Fox in a Box Posted 5 May 2008 Author Posted 5 May 2008 All it tells us is that he got us for peanuts! Even less now we've been relegated. exactly thats the point and therefore he will look at that as a positive, and hopefully gives him extra to reinvest.
act smiley Posted 5 May 2008 Posted 5 May 2008 Obviously its stuff that was already known to some extent (how widely is obviously the key), but the positive that I see is that the guaranteed level of investment into the club is explicitly stated as being in two installments. That guaranteed extra £4.5 million for next season will probably be spent covering the reduced income, but its still very welcome and I'm glad we didn't blow all his money on crap when he first turned up.
davieG Posted 5 May 2008 Posted 5 May 2008 Obviously its stuff that was already known to some extent (how widely is obviously the key), but the positive that I see is that the guaranteed level of investment into the club is explicitly stated as being in two installments. That guaranteed extra £4.5 million for next season will probably be spent covering the reduced income, but its still very welcome and I'm glad we didn't blow all his money on crap when he first turned up. There could well be a get out clause for that now that we've been relegated - just a thought.
Thracian Posted 5 May 2008 Posted 5 May 2008 All it tells us is that he got us for peanuts! Even less now we've been relegated. A select few did mention way back that he got us on the cheap. What was that magical figure the Mercury said Mandaric was paying - the figure they kept trying to brainwash us with?
act smiley Posted 5 May 2008 Posted 5 May 2008 £25m. Which is cost to buy club + guaranteed investment + remaining debt on the stadium. Only he's not paying the stadium debt out of his own pocket. The fools, even the numbers he's coming out with himself say £11m!
Basingstoke Fox Posted 5 May 2008 Posted 5 May 2008 I actually tried reading all of that. I got a quater of the way through, looked on the right and realised I was never going to finish that No wonder it took so long to sort that deal out!
Daggers Posted 5 May 2008 Posted 5 May 2008 Bollocks to this - there are still the big questions concerning Rob Kelly's rolling contract to be answered...
coale39 Posted 5 May 2008 Posted 5 May 2008 Bollocks to this - there are still the big questions concerning Rob Kelly's rolling contract to be answered...
Rich Fox Posted 5 May 2008 Posted 5 May 2008 A select few did mention way back that he got us on the cheap.What was that magical figure the Mercury said Mandaric was paying - the figure they kept trying to brainwash us with? I think you under estimate the fans if you think we all believe what it says in the merc or any other newspaper for that matter. Cant understand why people are coplaining that milan got us on the cheap surely thats a good thing, all clubs bullshit about finances and i would doubt there are many honest joes running football clubs, milan has been slated on this forum but people must have very short memories or they are very young because weve never had a chairman any better than milan. The one time when we were let down most was when we had martin o neill and with a little investment and we could have been a top side even further back and bloomfields side needed some money spent then but it was the same old story and as for martin george do me a favour. Milan has not spent that much on lcfc I know that most people probably know that but he has spent some and we have not had that before and dont say 5 mil on akinbiyi etc because that came from brunos sale and oneills sucess.
davieG Posted 5 May 2008 Posted 5 May 2008 I think you under estimate the fans if you think we all believe what it says in the merc or any other newspaper for that matter. Cant understand why people are coplaining that milan got us on the cheap surely thats a good thing, all clubs bullshit about finances and i would doubt there are many honest joes running football clubs, milan has been slated on this forum but people must have very short memories or they are very young because weve never had a chairman any better than milan. The one time when we were let down most was when we had martin o neill and with a little investment and we could have been a top side even further back and bloomfields side needed some money spent then but it was the same old story and as for martin george do me a favour.Milan has not spent that much on lcfc I know that most people probably know that but he has spent some and we have not had that before and dont say 5 mil on akinbiyi etc because that came from brunos sale and oneills sucess. You'd be surprised how many people still believe the £25 mill con and think the Stadium has been paid off. The £25 mill is still regularly quoted in the media and consequently by LCFC fans on here, other forums and on the Moan In. In fact I've given up telling people because it was becoming a full time job. I've even written to the Merc but they refuse to even acknowledge my messages. The point re getting us on the cheap is used to counteract the diabolical sycophantic outpourings of Blanderson and his continuous misrepresentation of how much MM has spent. Today's (Tuesday) Sun MILAN MANDARIC will fly to England this week and sack Leicester boss Ian Holloway. Foxes chairman Mandaric, who is in America, will then decide whether to take a £10million hit by selling the club, which has dropped to the third tier of football for the first time in their history. The Serb completed a £25m takeover just 15 months ago, but since then five managers have walked through the out door of the Walkers Stadium. Mandaric, 69, fumed: “Look at the support I have given to my managers and my players, both financially and morally, and what do you get in response? “You expect rewards and results. We didn’t get it and you have to feel let down.” As i said they'll be many that believe those figures even if they don't believe the full story.
Jon the Hat Posted 5 May 2008 Posted 5 May 2008 weve never had a chairman any better than milan. Yes he is indeed the best Chairman ever, topping the list of those who have overseen our relegation to League 1. Congratulations on possibly the most baseless statement in the history of foxestalk.
Daggers Posted 5 May 2008 Posted 5 May 2008 Yes he is indeed the best Chairman ever, topping the list of those who have overseen our relegation to League 1. Congratulations on possibly the most baseless statement in the history of foxestalk. I am deeply disappointed that you discount my post on getting all dogs muzzled in public.
Nationwider Posted 5 May 2008 Posted 5 May 2008 OZYMANDIAS I met a traveller from an antique land Who said: Two vast and trunkless legs of stone Stand in the desert. Near them on the sand, Half sunk, a shatter'd visage lies, whose frown And wrinkled lip and sneer of cold command Tell that its sculptor well those passions read Which yet survive, stamp'd on these lifeless things, The hand that mock'd them and the heart that fed. And on the pedestal these words appear: "My name is Ozymandias, king of kings: Look on my works, ye Mighty, and despair!" Nothing beside remains: round the decay Of that colossal wreck, boundless and bare, The lone and level sands stretch far away.
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