TIDMPTCM
RNS Number : 7498O
Porta Communications PLC
09 November 2016
9 November 2016
Porta Communications Plc
("Porta", "the Group" or "the Company")
Conversion of Debt
Due from Twenty20 Media Vision Limited to
Hawk Investment Holdings Limited
Porta Communications Plc, the international communications and
marketing group, announces that is has agreed the settlement of
debt due from the Company's subsidiary, Twenty20 Media Vision
Limited (in Administration) ("Twenty20"), to Hawk Investment
Holdings Limited ("Hawk"), a company beneficially owned by Bob
Morton, a former director of Porta, and his wife, by way of the
allotment and issue of 9.12 million new ordinary shares of 1p each
("Ordinary Shares") in the capital of the Company.
Gene Golembiewski, Finance Director, said: "We are pleased to
have satisfied this liability, which results in no cash outflow
from the Company. This loan conversion represents the first step in
optimising the Company's capital structure and consolidating our
financial position, following the series of start-ups and corporate
acquisitions that we have made over the past few years. We continue
to evaluate our balance sheet and future capital requirements."
At the time Twenty20 went into administration in February 2015,
it had loans outstanding due to Hawk which Twenty20 defaulted on by
virtue of entering into administration. The following sums are due
by Twenty20 to Hawk as at 9 November 2016:
1. GBP831,149.39, representing a principal balance of GBP300,000
and all accrued standard interest, additional interest and interest
on capital due, being the total sum of GBP531,149.39; and
2. GBP242,418.57, representing a principal balance of GBP87,500
and all accrued standard interest, additional interest and interest
on capital due, being the total sum of GBP154,918.57 (the "Twenty20
Loans").
Due to the cross default provisions contained within Hawk's
other loan agreements with the Company (including a secured
discounted bond with a face value of GBP4.11 million), the Company
has agreed with Hawk for the settlement of the principal of the
Twenty20 Loans by way of the issue of new Ordinary Shares in an
agreement executed today (the "Debt Conversion Letter"). The terms
of the Debt Conversion Letter are that the principal sums due to
Hawk totalling GBP387,500 under the Twenty20 Loans are being
converted into 9,117,647 new Ordinary Shares at an issue price of
GBP0.0425 per new Ordinary Share (the "Conversion Shares").
Hawk has also agreed to assign to Porta all accruing interest
and benefits of the Twenty20 Loans, to the extent that funds are
received from the administrator in the future. Therefore, the total
outstanding interest balances of GBP531,149.39 and GBP154,918.57
will not be payable by Porta, and should any amounts be distributed
by the administrator of Twenty20 in respect of these balances, they
will be receivable by the Company.
The Debt Conversion Letter includes that, in return for the
allotment and issue of the Conversion Shares to Hawk, Hawk will
provide the Company with:
1. an irrevocable waiver in respect of the Company's defaults
under the various finance documents with Hawk in relation to the
Company's liability for the default by Twenty20;
2. an irrevocable release of the Company and Twenty20 from all
liabilities and obligations to Hawk under or pursuant to the
Twenty20 Loans; and
3. an assignment of all Hawk's rights to the continuing accruing
interest on the Twenty20 Loans and all and any funds Hawk may
receive from the administrator of Twenty20 to the Company,
Following execution of the Debt Conversion Letter, the Company
has today allotted and issued the Conversion Shares to Hawk.
Interest in Shares
Following the issue of the Conversion Shares, Bob Morton, via
his beneficial ownership of Hawk and Hawk Pension Fund Limited, is
beneficially interested in 54,053,965 Ordinary Shares, representing
approximately 18.25 per cent. of the enlarged share capital.
Related Party Transaction
The Debt Conversion Letter is a related party transaction under
the AIM Rules for Companies as Hawk is a substantial shareholder
and is also a company beneficially owned by Bob Morton who had been
a director of the Company within the past year. The directors of
the Company consider, having consulted with Grant Thornton UK LLP,
the Company's nominated adviser, that the terms of this transaction
are fair and reasonable insofar as its shareholders are
concerned
Application for admission to trading on AIM
Application has been made to the AIM Market of the London Stock
Exchange ("AIM") for the Conversion Shares, which rank pari passu
with the Company's existing issued ordinary shares, to be admitted
to trading on AIM. Dealings on AIM are expected to commence at 8:00
a.m. on or around 15 November 2016 ("Admission").
Total Voting Rights
For the purposes of the Financial Conduct Authority's Disclosure
Guidance and Transparency Rules ("DTRs"), following Admission the
issued ordinary share capital of the Company will comprise
296,259,832 Ordinary Shares with voting rights attached (one vote
per share). The Company does not hold any shares in treasury. This
figure of 296,259,832 may be used by the Company's shareholders as
the denominator for the calculation by which they will determine
whether they are required to notify their interest in, or a change
to their interest in the share capital of Porta under the DTRs.
- ends -
The information contained within this announcement is considered
to be inside information prior to its release.
Enquiries
Porta Communications Plc
Gene Golembiewski, Finance Director
www.portacomms.com
+44 (0) 20 7680 6500
Grant Thornton UK LLP (Nominated Adviser)
Philip Secrett
Samantha Harrison
Daniel Bush
+44 (0) 207 383 5100
N+1 Singer (Broker)
James Maxwell
Lauren Kettle
+44 (0) 20 7496 3000
Redleaf PR (Media Enquiries)
Charlie Geller
Sam Modlin
+44 (0) 20 7382 4769
Notes to Editors:
Porta has two divisions:
-- Communications - financial, corporate and consumer public
relations, public affairs and research;
-- Marketing & Advertising - multi-capability marketing,
brand and creative communications.
The Group has offices in Abu Dhabi, Beijing, Brisbane, Bristol,
Canberra, Cardiff, Edinburgh, Hong Kong, London, Manchester,
Melbourne, Singapore and Sydney.
The brands and companies it owns are: Newgate Communications,
PPS Group, Redleaf Communications, Publicasity, 13 Communications,
Newgate Sponsorship, 2112 Communications and Summit Marketing
Services.
Porta Communications' corporate website is -
www.portacomms.com
This information is provided by RNS
The company news service from the London Stock Exchange
END
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