Neometals Regulatory News (NMT)

10 Feb 2006 15:11

NMT Group PLC10 February 2006 10 February 2006 NMT Group plc ("the Company") Material Transaction with a Related Party The Company announces that it has today entered into an agreement ("theAgreement") with Volvere plc ("Volvere") (1), a substantial shareholder of andtherefore a related party of the Company under the AIM Rules, (2) Lord Kalms ofEdgware, a Director of the Company, (3) Jonathan Lander, a Director of theCompany, (4) Nicholas Lander, a Director of the Company and (5) Dawnay DayLander Limited. This varies an agreement entered into on 26 November 2005pursuant to which the services of Lord Kalms of Edgware, Jonathan Lander andNicholas Lander (the "Executive Directors") were seconded to the Company byVolvere. Duties Under the terms of the Agreement, the Executive Directors are required to fulfilall appropriate board and management functions relating to the Company includingbut not limited to: the function of Chairman, the day-to-day supervision of theCompany's business and staff, and the identifying and implementation ofstrategies for realising shareholder value. Management and Performance Fee In consideration for fulfilling the duties outlined above, the existingarrangements the Company pays Volvere an annual fee of £40,000 plus VAT inrelation to the provision of Lord Kalms' services and an amount of £20,000 permonth plus VAT collectively in respect of the services of Jonathan Lander andNicholas Lander at any time when the Company is in an offer period for thepurposes of the Takeover Code or during a period of significant corporateactivity. In any period not being an offer period or a period of significantcorporate activity the fee in relation to the services of Nicholas and JonathanLander is reduced to £60,000 per annum plus VAT on a pro rata basis. As of 9February these arrangements are terminated. Under the revised arrangements,the Company will from 10 February 2005 pay to Volvere a Management Fee plus aPerformance Fee. The Management Fee is a monthly fee payable in cash equal to 0.25% of the netassets of the Company determined in accordance with the consolidated monthlymanagement accounts. The Performance Fee is an amount payable in cash equal to 20 per cent. of anyuplift in the share price of the Company, measured at monthly rests followingthe date of the Agreement. To the extent that the share price falls againsubsequently, no further Performance Fee will be payable unless the share priceof the Company rises above the previous highest level and remains above thatlevel at the next monthly calculation date. Termination The Agreement may be terminated by giving three months' notice in writing byeither Volvere or the Company. In the event that the Agreement is terminated bythe Company other than in certain specified circumstances, Volvere is entitledto a Termination payment of six per cent of the then current Net Asset Value(calculated as at the end of the previous month.) In addition Volvere isentitled to a payment of an amount equal to : O x B Where: O = the value of an option using the Black Scholes valuation model with thefollowing inputs: Maturity = 24 months; Volatility = the higher of thehistorical 12 months volatility and 20%; Exercise price = the lowest closingmid-market price for the 12 months prior to the termination date; interest rate= 4%; and B = the weighted average number of the Company's ordinary shares outstanding forthe month prior to termination. Lex Gold and George Wardale, who are independent Directors of the Company inrelation to the Agreement as they have no personal involvement in the Agreement,consider, having consulted with the Company's Nominated Adviser Shore Capital &Corporate Limited, that the terms of the Agreement are fair and reasonableinsofar as its shareholders are concerned. Enquiries:NMT Group PLC Jonathan Lander 020 7979 7574Shore Capital & Corporate Limited Guy Peters 020 7408 4090 This information is provided by RNS The company news service from the London Stock Exchange