AGM - Resolutions

[VectisSaint]

Received my invitation to the AGM and voting papers this morning. There are the expected resolutions to receive the financial statements & to re-elect all of the Board Members (Cowen, Lowe, Wilde and Jones), but there are 2 resolutions under Special Business.

 

I've read these resolutions through and can confidently state that they are complete financial gobbledegook to me. Can anyone else explain what they mean, so that I can make an informed decision how to vote (I already know exactly how to vote for the other resolutions).

 

I won't enter the complete resolutions because they are quite lengthy, but to summarise:

7 Directors generally & unconditionally authorised of the purpose of Sect 80 of Companies Act 1985 to exercise powers to allot relevant securities up to aggregate nominal value of £468,181 blah blah blah

 

8 Pursuantto the authority in 7 above Directors empowered pursuant to Sect 95 of the Act until 1 Dec 2013 allot equity securities for cash blah blah blah gobbledegook blah.

[Thedelldays]

surely...everyone on this site is an expert right?

 

should be a doddle to understand

[um pahars]

Received my invitation to the AGM and voting papers this morning. There are the expected resolutions to receive the financial statements & to re-elect all of the Board Members (Cowen, Lowe, Wilde and Jones), but there are 2 resolutions under Special Business.

 

I've read these resolutions through and can confidently state that they are complete financial gobbledegook to me. Can anyone else explain what they mean, so that I can make an informed decision how to vote (I already know exactly how to vote for the other resolutions).

 

I won't enter the complete resolutions because they are quite lengthy, but to summarise:

7 Directors generally & unconditionally authorised of the purpose of Sect 80 of Companies Act 1985 to exercise powers to allot relevant securities up to aggregate nominal value of £468,181 blah blah blah

 

8 Pursuantto the authority in 7 above Directors empowered pursuant to Sect 95 of the Act until 1 Dec 2013 allot equity securities for cash blah blah blah gobbledegook blah.

 

Both of these resolutions had been passed in something like 2003/4 (and before that in the late 90's as well) and have expired (I think after 5 years), so therefore need reintroducing.

 

They are both to do with issuing unissued shares (if that makes sense).

 

Normally shares can only be issued with shareholders approval in a general meeting, but the first one allows for the directors to allocate a third of the shares without this aproval.

 

The second one then allows for 5% of the company's shares to be issued outside of a rights issue. Normally when shares are issued in a rights issue existing shareholders have a right to take up their %'s. This allows for issues of 5% to by-pass this.

 

Can't see anything controversial there, but on the second one is there a line that says something like "at preset the Directors have no intention to exercise this authority"???

[VectisSaint]

Both of these resolutions had been passed in something like 2003/4 (and before that in the late 90's as well) and have expired (I think after 5 years), so therefore need reintroducing.

 

They are both to do with issuing unissued shares (if that makes sense).

 

Normally shares can only be issued with shareholders approval in a general meeting, but the first one allows for the directors to allocate a third of the shares without this aproval.

 

The second one then allows for 5% of the company's shares to be issued outside of a rights issue. Normally when shares are issued in a rights issue existing shareholders have a right to take up their %'s. This allows for issues of 5% to by-pass this.

 

Can't see anything controversial there, but on the second one is there a line that says something like "at preset the Directors have no intention to exercise this authority"???

Cheers UP, while I do have some knowledge of these financial issues, these 2 resolutions were just mind numbingly financial geek speak. The second resolution does not include anything about them not intending to invoke this. Have just realised that there are another 2 paras on the reverse page (8.1 & 8.2) might have helped if I'd read them as well, although 8.1 at least is just more of the same jargon. 8.2 does refer to an amount of £70,227 as being the amount (of shares) they can issue.

 

By the way the short titles for these 2 resolutions on the Form of Proxy are:

7. Authority to allot unissued shares

8. Disapplication of statutory pre-emption rights

[um pahars]

Cheers UP, while I do have some knowledge of these financial issues, these 2 resolutions were just mind numbingly financial geek speak. The second resolution does not include anything about them not intending to invoke this. Have just realised that there are another 2 paras on the reverse page (8.1 & 8.2) might have helped if I'd read them as well, although 8.1 at least is just more of the same jargon. 8.2 does refer to an amount of £70,227 as being the amount (of shares) they can issue.

 

By the way the short titles for these 2 resolutions on the Form of Proxy are:

7. Authority to allot unissued shares

8. Disapplication of statutory pre-emption rights

 

Have a look in the notes, because that is where the intention to or not to would be.

 

As for the £70k fugure that is 5% of our nominated issued share capital (approx 5% of our 28,000,0000 existing shares with a nominal value of 5p) which they can issue without having to offer some to existing shareholders.

[VectisSaint]

Have a look in the notes, because that is where the intention to or not to would be.

 

As for the £70k fugure that is 5% of our nominated issued share capital (approx 5% of our 28,000,0000 existing shares with a nominal value of 5p) which they can issue without having to offer some to existing shareholders.

Definitely nothing in the notes about the intent.

As you say if this is simply renewing an earlier resolution that has expired then there is probably nothing in it. I just wonder why they feel the need to have these powers in place, there must be some reason, otherwise why bother?

[Saint_John]

I think these resolutions have been used in the past.

 

If you look back to the 2001 accounts you will see that the Dividend payments changed from £324,123 (2000) to £328,070 (2001). This was because of 394,737 new shares being allocated on the 29 Jan 2001.

 

The SE announcement is here :-

http://www2.hemscott.com/scripts/AFXnewstory.dll/text?EPIC=SOO&SerialNumber=2245&NewsType=AFR&Indate=29/01/2001

 

I believe what this is saying is that one of the Directors exercised a Share Option and rather than purchase the shares from the market they decided to "print some more".

 

I know that RL,AC and DJ gave themselves more Share Options in May/June 2004 at 44p to be exercised between 6 May 2007 to 5 May 2011 which IMO caused the "focus" of the Club to be on the Share Price in 2004 which IMO led to relegation in May 2005.

 

Because of what happened in 2004 I will be voting AGAINST the 2 resolutions.

Hasn't the Dark Lord learned from his mistakes the first time, this is a Football Club first ?

 

p.s.

This is probably just Pub talk but has anybody heard a rumour about one of Lowe other companies ?

[benjii]

p.s.

This is probably just Pub talk but has anybody heard a rumour about one of Lowe other companies ?

 

No, but I love a good rumour. Please do feel free to spread it.

[bridge too far]

Well I've just found a bizarre link between W H Ireland (Rupey's brokerage outfit) and Carphone Warehouse where the director named in the link below has just had to resign after shenanigans with his shares :shock:

 

http://business.timesonline.co.uk/tol/business/markets/article3793037.ece

 

And, from another article:

 

Who are the new investors?

The 'new' shareholders consist of a consortium led by former Tory treasurer Lord Marland, and include Carphone Warehouse co-founder David Ross and City businessmen Rupert Lowe and David Whelan.

 

http://www.investorschronicle.co.uk/Columnists/SmallWorld/article/20080714/042edbc8-4f55-11dd-8727-0015171400aa/Whats-happening-at-WH-Ireland.jsp

Edited 8 December, 2008 by bridge too far

[Long Shot]

I think these resolutions have been used in the past.

 

If you look back to the 2001 accounts you will see that the Dividend payments changed from £324,123 (2000) to £328,070 (2001). This was because of 394,737 new shares being allocated on the 29 Jan 2001.

 

The SE announcement is here :-

http://www2.hemscott.com/scripts/AFXnewstory.dll/text?EPIC=SOO&SerialNumber=2245&NewsType=AFR&Indate=29/01/2001

 

I believe what this is saying is that one of the Directors exercised a Share Option and rather than purchase the shares from the market they decided to "print some more".

 

I know that RL,AC and DJ gave themselves more Share Options in May/June 2004 at 44p to be exercised between 6 May 2007 to 5 May 2011 which IMO caused the "focus" of the Club to be on the Share Price in 2004 which IMO led to relegation in May 2005.

 

Because of what happened in 2004 I will be voting AGAINST the 2 resolutions.

Hasn't the Dark Lord learned from his mistakes the first time, this is a Football Club first ?

 

p.s.

This is probably just Pub talk but has anybody heard a rumour about one of Lowe other companies ?

 

 

There was a lot of talk on the train to Charlton about a Shirley based electrical company who are in deep financial trouble and Lowe is apparantly a director.

[bridge too far]

There was a lot of talk on the train to Charlton about a Shirley based electrical company who are in deep financial trouble and Lowe is apparantly a director.

 

Lowe Holdings includes a few of electrical engineering companies from what I can see:

 

1. Lowe & Oliver, based in Oxford

2. R F Webb, Head Office in EASTLEIGH (not Shirley :smt102

3. J Brand () London and Runcorn, Cheshire

4. DataPath based in N. Somerset.

[Saint 76er]

There was a lot of talk on the train to Charlton about a Shirley based electrical company who are in deep financial trouble and Lowe is apparantly a director.

 

Have you heard the one about the St Marys catering outfit with football connections who may also be in deep financial trouble and Lowe is apparently the chairman (amongst other things)?

[bridge too far]

Well, I refer you good gentlefolk again to the news that a director of W H Ireland is the owner / director of Carphone Warehouse who's just resigned from that esteemed establishment because of perceived share irregularities - allegedly.

 

He claimed his 'oversight' was an administrative error - this from a man who's a director / shareholder in a stockbroking firm.

 

Well I never........

[Weston Saint]

Lowe Holdings includes a few of electrical engineering companies from what I can see:

 

1. Lowe & Oliver, based in Oxford

2. R F Webb, Head Office in EASTLEIGH (not Shirley :smt102

3. J Brand () London and Runcorn, Cheshire

4. DataPath based in N. Somerset.

 

what evidence is there that Rupert Lowe has anything to do with Lowe Holdings other than share the name!

 

R F Webb was based in Shirley. A friend of mine was the Chairman and owner of the company when he sold out to Lowe Holdings. I remember being in his office at the time and there was no suggestion of Rupert Lowes involvement!

 

Anyone any evidence of a link!

[benjii]

http://www.loweoliver.co.uk/history.htm

 

"Patrick" is Lowe's dad isnt he?

[Scummer]

what evidence is there that Rupert Lowe has anything to do with Lowe Holdings other than share the name!

 

R F Webb was based in Shirley. A friend of mine was the Chairman and owner of the company when he sold out to Lowe Holdings. I remember being in his office at the time and there was no suggestion of Rupert Lowes involvement!

 

Anyone any evidence of a link!

 

Rupert Lowe resigned as Director of Southampton Leisure Holdings plc on June 30 2006. Rupert Lowe was appointed non-executive Chairman in 1992 and executive Chairman in 1995. He is also Chairman of Southampton Football Club. Prior to joining the Company he was Managing Director of DBMG Futures and Options Limited, a subsidiary of Deutrche Bank AG. He is Director of Lowe Holdings Ltd, Lowe and Oliver Ltd, Hills Building Service Ltd, Arlowe Properties Ltd, J Brand Ltd, Data-Path Office Network Services Ltd, Intelligence Research Ltd, Appleclaim Ltd, Jubilee Motor Policies Ltd, Jubilee Managing Agency Ltd, Jubilee Administration Ltd, Cassidy Capital Ltd, Coverpoint Holdings Ltd, Tillmouth and Tweed Salmon Fishings LLP, Wrist Marketing Ltd and WH Ireland Ltd. Previous Directorships: IP Maestrale Energy Italy 2 LLP, IP Maestrale Energy Italy 3 LLP, Carlton Mews Limited, Southampton Insurance Services Limited, Radio Hampshire Limited, St Marys Stadium Limited, St Marys SPV Limited, Football Association Limited, Felix Broadcasting Limited, Forest FM Limited, Southcity FM Limited, Wembley National Stadium Limited, Southampton Swaylife Limited, Dell Estates Limited and Stadium 2000 Limited.

 

http://markets.ft.com/ft/tearsheets/businessProfile.asp?s=UK:SOO

[Weston Saint]

http://markets.ft.com/ft/tearsheets/businessProfile.asp?s=UK:SOO

 

Ah thanks for that.

[benjii]

Tilmouth and Tweed Salmon Fishings LLP

 

[bridge too far]

Tilmouth and Tweed Salmon Fishings LLP

 

 

I particularly liked 'Wrist Marketing'.

 

I wonder which hand? :oops:

[Tamesaint]

http://markets.ft.com/ft/tearsheets/businessProfile.asp?s=UK:SOO

 

So who owns the most? Rupert with Lowe Holdings or Leon with his clutch of engineering businesses? Who is the more successful businessman?

Edited 8 December, 2008 by Tamesaint
Grammar

[VectisSaint]

http://markets.ft.com/ft/tearsheets/businessProfile.asp?s=UK:SOO

No wonder we are in the ****, Jim Hone is still the Chairman. You'd think this data would have been updated by now, it was a year ago that the Wilde Bunch stood down (sadly Wilde is still with us).

[benjii]

So who owns the most? Rupert with Lowe Holdings or Leon with his clutch of engineering businesses? Who is the more successful businessman?

 

Well, who says Rupert Lowe owns any of those?

 

All we know is that he is a director.

 

He may well be "Mr 6%" in all of them.

[scally]

R F Webb formed 1932

Taken over by Lowe Holdings a couple of years ago

Went into voluntary liquidation 2008

Rupert Lowe strikes again, what a great business man he is.

I was told today that their staff have been told tomorrow will be their last day.

Who will Lowe blame for this one?

[benjii]

Didn't Lowe own Woolworths, Enron and WaMu too?

[70's Mike]

what evidence is there that Rupert Lowe has anything to do with Lowe Holdings other than share the name!

 

R F Webb was based in Shirley. A friend of mine was the Chairman and owner of the company when he sold out to Lowe Holdings. I remember being in his office at the time and there was no suggestion of Rupert Lowes involvement!

 

Anyone any evidence of a link!

 

Reg or John?

or am i showing my age

[Weston Saint]

Reg or John?

or am i showing my age

 

 

Reg passed away some years ago but before he did he gave 51% to his son, John? and 49% to my friend who became Chairman. He then bought John out in 2002 and sold the business to Lowe Holdings a few years after and retired. Paul Stratford was his name. Was with Webbs since his appentiship with the company.

 

I have just emailed him

[70's Mike]

Reg passed away some years ago but before he did he gave 51% to his son, John? and 49% to my friend who became Chairman. He then bought John out in 2002 and sold the business to Lowe Holdings a few years after and retired. Paul Stratford was his name. Was with Webbs since his appentiship with the company.

 

I have just emailed him

 

I used to do their Audit back in the 80's before I moved into industry.

Knew the Webbs when they were in Rockstone Place, i think Paul was am estimator there then or shortly after they moved to Shirley

[jonah]

he SE announcement is here :-

http://www2.hemscott.com/scripts/AFXnewstory.dll/text?EPIC=SOO&SerialNumber=2245&NewsType=AFR&Indate=29/01/2001

 

I believe what this is saying is that one of the Directors exercised a Share Option and rather than purchase the shares from the market they decided to "print some more".

 

You either completely miss the point about what options are and how they can benefit the club (sometimes at the expense of other shareholders), or you have phrased this really badly to imply the Directors are the ones "printing money".

 

Firstly, when options are issued to Directors this is NOT a bad thing for the club - if or when they are exercised, those Directors have to stump up the cash to buy those shares. So for example, RL, AC and DJ have in total 600,000 options @ 46p which expire in 2011. Now if the share price reaches say 50p by that time (yeah right, likely I know), they don't just get given those shares, they have to pay 600,000 x 46p = £276,000 to the club. They then have a nominal 50p-46p=4p/share "profit". So for stumping up £276,000 they make a £24,000 paper profit, the club gains £276,000 and the only slight losers are existing shareholder who see they own holdings diluted by about 1% (though the club has gained cash so in theory is worth more).

 

And I hate to burst your bubble of hatred, but as far as I'm aware those shares were not actually from an option exercised by a Director, but in fact were the chosen form of renumeration by one of the firms involved in the stadium funding - ie. we paid them their £150,000 in shares rather than cash. Rather a good move wouldn't you say?

 

I know that RL,AC and DJ gave themselves more Share Options in May/June 2004 at 44p to be exercised between 6 May 2007 to 5 May 2011 which IMO caused the "focus" of the Club to be on the Share Price in 2004 which IMO led to relegation in May 2005.

 

You're having a laugh surely? They issue some options which last 7 years but couldn't even be exercised for THREE years, and you think that's the cause of our relegation less than 12 months later?! Priceless.

 

Options are used as incentives in all forms of business from shop cleaners at John Lewis to CEOs of hedge funds - it doesn't make those companies focus unduly on share price because even if they temporarily spiked the share price you couldn't possibly sell all the shares from the exercised options at that price for a profit anyway. They will only gain by building up the company. Not to mention the rather important fact that the SLH options couldn't even have been exercised until well after our relegation!! Talk about a desperate attempt to pick fault in the board, you're blaming them for getting us relegated 2 years before some options could even be exercised!

 

Because of what happened in 2004 I will be voting AGAINST the 2 resolutions.

Hasn't the Dark Lord learned from his mistakes the first time, this is a Football Club first ?

 

Make sure you boycott John Lewis for also running scandalous schemes to incentivise their employees. Shame on them, I bet they are all duck-hunters too. I would also recommened closing your bank accounts, emptying your pension fund, not catching the bus, refusing to buy beer, no food from supermarkets, no petrol, no cars either in fact... in fact, you could go and live in a cave to escape it (provided you don't have any water or electricity there either).

 

Of course the more balanced view of those people who at least reside on this planet, is that should the share price place those options in-the-money (ie. above 46p), the club will benefit to the tune of £276,000 which would be extremely welcome in our current predicament. But then this is just like Crouch, Wilde or Trant fulfilling their promises of putting in new money, which they could do at any time through a placing.

 

Back to the original point, these AGM resolutions are pretty standard and they cover not only new options, but placings as well - basically any new share issue without pre-emptive rights, ie. not a rights issue or open offer which enable existing shareholders to maintain their relative holdings.

[VectisSaint]

You either completely miss the point about what options are and how they can benefit the club (sometimes at the expense of other shareholders), or you have phrased this really badly to imply the Directors are the ones "printing money".

 

Firstly, when options are issued to Directors this is NOT a bad thing for the club - if or when they are exercised, those Directors have to stump up the cash to buy those shares. So for example, RL, AC and DJ have in total 600,000 options @ 46p which expire in 2011. Now if the share price reaches say 50p by that time (yeah right, likely I know), they don't just get given those shares, they have to pay 600,000 x 46p = £276,000 to the club. They then have a nominal 50p-46p=4p/share "profit". So for stumping up £276,000 they make a £24,000 paper profit, the club gains £276,000 and the only slight losers are existing shareholder who see they own holdings diluted by about 1% (though the club has gained cash so in theory is worth more).

 

And I hate to burst your bubble of hatred, but as far as I'm aware those shares were not actually from an option exercised by a Director, but in fact were the chosen form of renumeration by one of the firms involved in the stadium funding - ie. we paid them their £150,000 in shares rather than cash. Rather a good move wouldn't you say?

 

 

 

You're having a laugh surely? They issue some options which last 7 years but couldn't even be exercised for THREE years, and you think that's the cause of our relegation less than 12 months later?! Priceless.

 

Options are used as incentives in all forms of business from shop cleaners at John Lewis to CEOs of hedge funds - it doesn't make those companies focus unduly on share price because even if they temporarily spiked the share price you couldn't possibly sell all the shares from the exercised options at that price for a profit anyway. They will only gain by building up the company. Not to mention the rather important fact that the SLH options couldn't even have been exercised until well after our relegation!! Talk about a desperate attempt to pick fault in the board, you're blaming them for getting us relegated 2 years before some options could even be exercised!

 

 

 

Make sure you boycott John Lewis for also running scandalous schemes to incentivise their employees. Shame on them, I bet they are all duck-hunters too. I would also recommened closing your bank accounts, emptying your pension fund, not catching the bus, refusing to buy beer, no food from supermarkets, no petrol, no cars either in fact... in fact, you could go and live in a cave to escape it (provided you don't have any water or electricity there either).

 

Of course the more balanced view of those people who at least reside on this planet, is that should the share price place those options in-the-money (ie. above 46p), the club will benefit to the tune of £276,000 which would be extremely welcome in our current predicament. But then this is just like Crouch, Wilde or Trant fulfilling their promises of putting in new money, which they could do at any time through a placing.

 

Back to the original point, these AGM resolutions are pretty standard and they cover not only new options, but placings as well - basically any new share issue without pre-emptive rights, ie. not a rights issue or open offer which enable existing shareholders to maintain their relative holdings.

Jonah, thanks for clarifying, once I had picked my way through your bile your answers were just what I was looking for in my original post. I have been given options many times as incentives in my business, sad really that I have never been able to exercise one due to the continued decline of the share price, if only business had boomed I would be quids in now