REG - Vela Technologies - AGM Notice, Share Consolidation, Investing Policy

Vela TechnologiesAnnouncement

30/12/2021 13:15

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RNS Number : 0809X  Vela Technologies PLC  30 December 2021

30 December 2021

 

Vela Technologies plc

("Vela" or the "Company")

Notice of Annual General Meeting

Proposed 1 for 50 Share Consolidation

Proposed change to investing policy

The Board of Vela (AIM: VELA), an AIM quoted investing company focused on
early stage and pre-IPO disruptive technology investments, announces that the
Company will today post a circular to shareholders containing a Notice of
Annual General Meeting ("AGM").

The Company's AGM will be held at 12.00 p.m. on 24 January 2022 at 15 Victoria
Mews, Mill Field Road, Cottingley Business Park, Bingley, West Yorkshire BD16
1PY.

Full details of the proposed resolutions are set out in the circular being
sent to shareholders in a letter from the Chairman, an extract of which is set
out below as well as a timetable of principal events. The circular will also
be made available shortly on the Company's website
at  http://www.velatechplc.com/ (http://www.velatechplc.com/) .

The resolutions being proposed at the AGM include a resolution relating to a
proposed 1 for 50 share consolidation of the existing ordinary share capital
of the Company and a resolution to approve the adoption by the Company of a
revised investing policy. The proposed new investing policy is set out in full
below.

There are no longer any Covid-19 related legal prohibitions on attending the
meeting in person.  However, in light of the continuing impact of Covid-19,
current government guidance, and recognising that some members and proxies may
still be reluctant to attend in person, (i) the vote on each of the
resolutions put to the meeting will be taken on a poll; and (ii) shareholders
are strongly advised to appoint the chairman of the meeting as their proxy.
The Company will keep the current Covid situation and any change to current
government guidance under review.  If arrangements for the meeting need to be
changed, a market announcement will be made through a regulatory information
service.

 

Letter from the Chairman of Vela

 

1.       Introduction

The accounts for the year ended 31 March 2021 were posted to shareholders on
30 September 2021.  This letter sets out the notice for the AGM, which will
be held at 15 Victoria Mews, Mill Field Road, Cottingley Business Park,
Bingley, West Yorkshire BD16 1PY at 12 noon on 24 January 2022.

2.       Resolutions at the Annual General Meeting

Information relating to resolutions to be proposed at the AGM is set out
below.  The notice of AGM is set out at the end of the letter sent to
shareholders.

The following resolutions will be proposed at the AGM:

(a)      Resolution 1:  to approve the annual report and accounts.  The
Directors are required to lay before the Company at the AGM the accounts of
the Company for the financial year ended 31 March 2021, the report of the
Directors and the report of the Company's auditors on those accounts.

(b)      Resolution 2:  to approve the re-appointment of Murray Harcourt
Limited as auditors of the Company.  The Company is required to appoint
auditors at each general meeting at which accounts are laid, to hold office
until the next such meeting.

(c)      Resolution 3:  to authorise the Directors to approve the
remuneration of the auditors.

(d)      Resolution 4:  to approve the re-appointment of Brent
Fitzpatrick as a Director.  Under the Articles of Association, Directors must
retire and submit themselves for re-election at the annual general meeting if
they have not done so at either of the two previous annual general meetings.

(e)      Resolution 5:  to approve the re-appointment of Emma Wilson as
a Director.  Emma joined the Board on 1 September 2021.  Under the Articles
of Association, Directors must be re-appointed at the first annual general
meeting following their appointment.

(f)      Resolution 6:  to approve a consolidation of every 50 ordinary
shares of 0.01p per share into one new ordinary share of 0.5p per share.
There are currently 16,252,335,184 ordinary shares of 0.01p ("Existing
Ordinary Shares") in issue.  The Directors consider that it is in the best
interests of the Company's development to have a more manageable number of
issued ordinary shares.  In order to ensure the issued share capital is
divisible by 50, 16 ordinary shares will be issued at par prior to the
consolidation record date of 6:00 p.m. on 24 January 2022 ("Record Date").
The consolidation will result in the creation of 325,046,704 new ordinary
shares of 0.5p each ("New Ordinary Shares").  As all the Existing Ordinary
Shares are proposed to be consolidated, the proportion of the issued ordinary
shareholdings in the Company held by each Shareholder immediately before and
after the Consolidation will, except for fractional entitlements, remain
unchanged.

Shareholders with a holding of more than 50 Existing Ordinary Shares, but
which is not exactly divisible by 50, will have their holding rounded down to
the nearest whole number of New Ordinary Shares.  Any shareholders holding
fewer than 50 Existing Ordinary Shares at the Record Date will cease to be a
shareholder of the Company.

The overall market capitalisation of the Company should not change as a result
of the consolidation, though the market price of each ordinary share is
expected to increase from approximately 0.045p (the price at the close of
business on 29 December 2021) to approximately 2.25p.

Disposal of fractional entitlements

Fractional entitlements to new ordinary shares arising from the consolidation
will be aggregated and will be sold in the market for the best price
reasonably obtainable on behalf of those Shareholders entitled to the
fractions.  As the net proceeds of sale will amount to less than £3 for any
entitled shareholder, they will (in accordance with usual market practice) be
retained by the Company.

Admission of the new ordinary shares

Application will be made for the New Ordinary Shares to be admitted to trading
on AIM in place of the Existing Ordinary Shares.  If approved at the AGM, the
Record Date for the consolidation will be the close of business on 24 January
2022.  It is expected that Admission will become effective and that dealings
in the New Ordinary Shares will commence on 25 January 2022.

ISIN and SEDOL codes

Following the consolidation, the ISIN code for the New Ordinary Shares will be
GB00BMG9C974 and the SEDOL code for the New Ordinary Shares will be BMG9C974.

Share Certificates

New share certificates in relation to the New Ordinary Shares will be
despatched to Shareholders who hold their ordinary shares in certificated form
in the week commencing 31 January 2022.  The new share certificates will be
sent by first-class post, at the risk of the holders of relevant new ordinary
shares, to the registered address of that holder or, in the case of joint
holders, to the one whose name appears first in the register of members.
Following the consolidation, existing ordinary share certificates will cease
to be valid.

Uncertificated shares

Shareholders who hold existing ordinary shares in uncertificated form will
have such shares disabled in their CREST accounts on the Record Date, and
their CREST accounts will be credited with the new ordinary shares following
Admission, which is expected to take place on 25 January 2022.

          Adjustment of warrants and options

Following the consolidation, the entitlements to ordinary shares of holders of
outstanding warrants and options will be adjusted to reflect the
consolidation.

With effect from the Record Date, the number of ordinary shares subject to
outstanding warrants or options will be divided by 50, and the exercise price
per share will be multiplied by 50.  The aggregate amount to be subscribed
upon an exercise of warrants or options will remain the same, and all other
terms of the warrants and options will remain unchanged.

(g)      Resolutions 7 and 8:  to approve the renewal of general
authorities to allot shares, which expire at the AGM, for the purpose of (i)
granting the Directors general authority to allot up to a maximum nominal
amount of £400,000, representing approximately 24.6% of the current issued
ordinary share capital; and (ii) disapplying pre-emption rights in connection
with the allotment of up to a maximum nominal amount of £400,000,
representing approximately 24.6% of the current issued ordinary share capital.

(h)      Resolution 9:  to approve the adoption by the Company of a
revised investing policy.  The revised investing policy is set out in full in
the resolution.  It replaces an investing policy adopted in January 2013 at
the time when the Company first became classified as an investing company
pursuant to the AIM Rules for Companies.  The Company has therefore had nine
years of experience operating as an investing company and, most relevantly, in
August 2020 underwent a reorganisation which including the disposal of certain
prior held investments.  Moreover, the current investing policy is expressed
in the context of the aspirations of the Company in 2013 and is therefore
expressed largely in the future tense.  The revised investing policy set out
in the AGM notice takes account both of the investing history of Vela and of
developments in the economic environment in the last nine years.  The
overarching aim to invest in disruptive technologies remains unchanged.

 

3.       Action to be taken

A form of proxy for use by Shareholders in connection with the AGM accompanies
the circular sent to shareholders.  The form of proxy should be completed in
accordance with the instructions printed thereon and returned to the Company's
registrars, Neville Registrars Limited, Neville House, Steelpark Road,
Halesowen B62 8HD as soon as possible but, in any event, so as to arrive by 12
noon on 20 January 2022.

4.       Recommendation

The Directors consider the Resolutions to be proposed at the General Meeting
to be in the best interests of the Company and its Shareholders as a whole and
accordingly recommend that Shareholders vote in favour of the Resolutions, as
I intend to do so in respect of my shareholding of 1,500,000 Ordinary Shares
(equivalent to approximately 0.01 per cent of the existing issued Ordinary
Shares).

 

Yours faithfully

 

Brent Fitzpatrick

Non-Executive Chairman

 

APPENDIX A- PROPOSED NEW INVESTING POLICY

The investing policy of Vela Technologies plc is focused on enterprises using
disruptive technology either to gain an advantage in an existing market or to
create a new market.  Within that over-arching strategy, Vela applies the
following criteria in reaching an investment decision.

Stage of development

Usually (but not necessarily) investee businesses will have been operating for
a number of years.  They may be established businesses that are developing a
new line or technology, or they may have been formed specifically in order to
exploit a particular product which is expected to disrupt the market or create
a completely new one.  The investee business may not yet have achieved
profitability.

Geographical focus

Investee companies will usually be based in the UK (including the Channel
Islands) or derive a material proportion of their business from the UK.
Conversely, investee companies may derive a significant proportion of their
income from overseas but be based in the UK.  It is unlikely that Vela would
invest in a business headquartered overseas and deriving a majority of its
business from outside the UK.

Sector focus

Disruptive technology is not confined to the pure technology sector, but may
be found in IT software businesses, including SaaS (software as a service); or
in 'bricks and mortar' businesses which use IT in innovative ways in order to
disrupt the sector in which they operate.

The definition of disruptive may also extend to pharmaceutical businesses
where, for example, a new drug may have the potential to make a beneficial
impact on the treatment of medical conditions; as well as to companies
operating in the wellness and life sciences sectors.

Corporate status

Vela aims to have a mix of private and publicly-traded investments.

The private companies will generally need to have ambitions for a public
listing in a relatively short time period (i.e. within two years of
investment); or, failing that, a plan to find a buyer for the business or to
scale up the business (e.g. by merging with or acquiring another or by raising
material additional equity funding) within a similar timescale.

Investments in public companies will usually be made as part of a development
capital financing designed to accelerate the growth of the business.

Investment instruments

Vela will generally expect to make investments in the form of equity.  It
will also consider investing in loan stock which is convertible (usually at
Vela's option) into equity shares.  In certain cases (e.g. a new drug which
may be one of a number being developed by the promoter) it may be appropriate
for Vela to take an interest in the future cash flows from that drug.  Vela's
investments will rarely be in the form of pure debt.

Investments will usually be in the form of cash but may also take the form of
an issue of new Vela shares.

In the case of equity investments, the Directors intend to take minority
positions and investments will therefore typically be of a passive nature.

Holding period

Vela invests with the intention of realising its investment within three years
of investment.  Investments can be made at the pre-IPO stage and in
anticipation of a public listing for the shares, often within a few months.
In such cases the whole or part of the investment may be sold on admission of
the investee company's shares to trading on a stock exchange.

Investments in companies whose shares are not traded on a public exchange are,
of course, inherently more difficult to realise; and so, although there may be
an intention to list the shares or to sell the business, Vela may need to hold
an investment in a private company for a longer time period.

The Directors intend to re-invest the proceeds of disposals in accordance with
the Company's investing policy unless, at the relevant time, the Directors
believe that there are no suitable investment opportunities in which case the
Directors will consider returning the proceeds to shareholders in a tax
efficient manner.

Number and size of investments

The number of projects in which the Company may invest will be limited by the
capacity of Vela's investment team to appraise and monitor them.  Similarly,
the monetary quantum of each investment is a factor of the funds available to
Vela at the point of investment.  Both the number and size of investments
will therefore vary according to Vela's human and monetary resources.  Each
of these will be referred to in Vela's annual and interim reports.  As
investments are made and new promising investment opportunities arise, further
funding of the Company may be required to enable Vela to make further
investments.

The Company will pursue a balanced portfolio of an even mixture of early
stage, pre-liquidity event and liquid investments.  While the aim is to have
the portfolio split fairly evenly between the different stages of liquidity,
there will be no set criteria for the proportion of the portfolio which will
be represented by each investment type.

Equity interests will be minority in nature and rarely exceed 10% of an
investee's issued share capital.

Opportunistic investments

As a result of Vela's network of contacts in the financial markets, it
occasionally receives invitations to invest in businesses which do not meet
the core criteria of the investing policy.  Nevertheless, if the Board
considers that there is an opportunity to benefit by investing in such a
proposition and thus allowing its shareholders access to investments in which
they may otherwise not be able to participate, it may consider doing so.
Such investments will be limited to no more than 5% of the Company's net asset
value and would usually be made on the strict understanding and expectation
that any such investment would be held for the short term only.

Investment appraisal

In order to mitigate investment risk, the Directors will carry out a thorough
appraisal of each potential investment.  This appraisal may include site
visits, analysis of financial, legal and operational aspects of each
investment opportunity, meetings with management, risk analysis, review of
corporate governance and anti-corruption procedures and, where the Directors
see fit, the seeking of third party expert opinions and valuation reports.
Vela will not have a separate investment manager.

Nature of returns

It is anticipated that returns to Vela will be delivered through a combination
of capital gain, dividend income and interest on convertible loans.

Where Vela's expected percentage holding in investee businesses or the
monetary quantum of its investment justifies it Vela may seek or be offered a
position on the investee's board of directors.  In those instances where this
is applicable, the fee earned from any such post held by a director or
employee of Vela would be payable to Vela and form part of the return earned
by Vela on its investment.

Cash held by the Company pending investment, reinvestment or distribution will
be managed by the Company and placed on deposit with banks so as to protect
the capital value of the Company's cash assets.  The Company may, where
appropriate, enter into agreements or contracts in order to hedge against
interest rate or currency risks.

Review of investing policy

The Directors will keep the investing policy under continuous review and will
make and announce any non-material changes or variations as may be
appropriate.  Any material change or variation to the investing policy will
be subject to the prior approval of shareholders."

 

APPENDIX B- EXPECTED TIMETABLE OF EVENTS

 

 Date of this document                                                    30 December 2021

 Latest time and date for receipt of Forms of Proxy                       12 noon on 20 January 2022
 Annual General Meeting                                                   12 noon on 24 January 2022
 Record Date for the share consolidation                                  6.00 p.m. on 24 January 2022
 Existing Ordinary Shares disabled in CREST and share register closed     6.00 p.m. on 24 January 2022

 Admission effective and dealings commence on AIM in New Ordinary Shares  8.00 a.m. on 25 January 2022
 CREST accounts credited with New Ordinary Shares                         25 January 2022
 Certificates in respect of New Ordinary Shares dispatched                week commencing 31 January 2022
 ISIN of Existing Ordinary Shares                                         GB00BYZ9XC29

 ISIN of New Ordinary Shares                                              GB00BMG9C974

 

Times stated above refer to UK time.

 

 

For further information, please contact:

 

 Vela Technologies plc                                          Tel: +44 (0) 7421 728875

 Brent Fitzpatrick, Non-Executive Chairman

 James Normand, Executive Director

 Allenby Capital Limited (Nominated Adviser and Joint Broker)   Tel: +44 (0) 20 3328 5656
 Nick Athanas/Piers Shimwell

 Peterhouse Capital Limited (Joint Broker)                      Tel: +44 (0) 20 7469 0930
 Lucy Williams / Duncan Vasey / Eran Zucker

 

About Vela Technologies

 

Vela Technologies plc (AIM: VELA) is an investing company focused on early
stage and pre-IPO long term disruptive technology investments. Vela's
investee companies have either developed ways of utilising technology or are
developing technology with a view to disrupting the businesses or sector in
which they operate. Vela Technologies will also invest in already-listed
companies where valuations offer additional opportunities.

 

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