SuperGroup Regulatory News (SGP)

2 Dec 2005 16:10

Sanctuary Group PLC02 December 2005 2 December 2005 The Sanctuary Group plc (the "Company") NOTICE OF EXTRAORDINARY GENERAL MEETING Notice is hereby given that an Extraordinary General Meeting of the above-namedcompany will be held at the offices of the Company at Sanctuary House, 45-53Sinclair Road, London W14 0NS on 20 December 2005 at 09.30 a.m. (or immediatelyfollowing the conclusion of the extraordinary general meeting called for 9.00a.m. on the same day - see background below), for the purpose of consideringand, if thought fit, passing the resolution, as set out below, which will beproposed as an ordinary resolution. Formal notices of the Extraordinary GeneralMeeting are being posted today. Background Shareholders have recently received from the Company a notice of anextraordinary general meeting to be held at 9.00 am on Tuesday 20 December 2005for the purpose of considering, in accordance with section 142 of the CompaniesAct 1985, whether any, and if so what, steps should be taken to deal with thesituation that the net assets of the Company are less than half of its called-upshare capital (the "Serious Loss of Capital EGM"). Further to that notice in relation to the serious loss of capital, the Directorsare calling another meeting of shareholders for the same morning and at the sameplace to consider the Company's current limits on borrowings set out in theCompany's Articles of Association. Because of the serious loss of capital andfor reasons beyond the Board's control, such limits may be breached in theabsence of further action by the Directors. Article 114.1 of the Company's Articles of Association (the "Borrowings Article"), provides that the Board may, subject as provided below, exercise all thepowers of the Company to borrow money, to guarantee, to indemnify and tomortgage or charge its undertaking, property, assets (present and future) anduncalled capital and to issue debentures and other securities whether outrightor as collateral security for any debt, liability or obligation of the Companyor of any third party. The Borrowings Article also provides, however, that the Board shall restrict theborrowing of the Company and exercise all voting and other rights or powers ofcontrol exercisable by the Company in relation to its subsidiaries (if any) witha view to securing (as regards subsidiaries as far as by such exercise the Boardcan secure) that the aggregate amount for the time being remaining undischargedof all moneys borrowed by the Company and/or any of its subsidiaries (excludingintra-group borrowings) shall not at any time, except with the previous sanctionof an ordinary resolution of the Company, exceed an amount equal to four timesthe share capital and consolidated reserves. In respect of the financial year to 30 September 2004, the Company's auditedaccounts showed share capital and consolidated reserves of £122,505,000, whichwould have given the Company a borrowing limit of over £490,020,000 (the "Current Borrowings Limit"). The Company and its subsidiaries are currentlyborrowing far less than this amount. The Board believes there to be a strong possibility that the audited accounts ofthe Company for the year ended 30 September 2005, will show the Company to havenegative share capital and consolidated reserves, thereby removing the company'sability to borrow. As a result, and unless the resolution to be put to themeeting called by the notice set out in this circular is passed, the limit asset out within the articles will be breached and the Board believes the companywill be unable to borrow any sums to finance its business. Shareholders are being asked to ratify the Company's current borrowings and togive the Board temporary authority to continue to borrow up to the CurrentBorrowings Limit. It is the Board's current intention to seek to put in place a more permanentchange to the Borrowings Article at the next Annual General Meeting of theCompany or, if one occurs earlier than the AGM, at a separate extraordinarygeneral meeting of the Company. Ordinary resolution That: 1. the existence and continued existence of the borrowings andindebtedness in the nature of borrowings, and any guarantee, indemnity, mortgageand/or charge in respect thereof, currently outstanding and undischarged inrespect of the Company (including its £30 million Convertible Loan Notes due2008 and the various facilities provided on or before the date hereof to theCompany by the Governor and Company of the Bank of Scotland), includingborrowings which are repaid and redrawn pursuant to the terms thereof be and arehereby ratified; 2. the Board be and is hereby authorised, subject as provided below, toexercise all the powers of the Company to borrow money, to guarantee, toindemnify and to mortgage or charge its undertaking, property, assets (presentand future) and uncalled capital and to issue debentures and other securitieswhether outright or as collateral security for any debt, liability or obligationof the Company or of any third party, so that the aggregate amount for the timebeing remaining undischarged of all moneys borrowed by the Company and/or any ofits subsidiaries (exclusive of moneys borrowed by the Company from and for thetime being owing to any such subsidiary or by any such subsidiary from and forthe time being owing to the Company or another such subsidiary) will not exceed£490,020,000 in principal amount (plus any interest, fees or expenses inconnection therewith) notwithstanding that the aggregate amount for the timebeing remaining undischarged of all moneys borrowed by the Company and/or any ofits subsidiaries (exclusive of moneys borrowed by the Company from and for thetime being owing to any such subsidiary or by any such subsidiary from and forthe time being owing to the Company or another such subsidiary) will exceed thelimit set out in Article 114.1 of the Company's Articles of Association;provided that such borrowing shall be authorised only until the conclusion ofthe Company's next Annual General Meeting; 3. the Board be authorised to agree to such amendments to the terms ofany of its existing borrowings or indebtedness in the nature of borrowings asthe Board may in its absolute discretion think fit and the Board be authorisedto execute and do all such acts, deeds, documents, certificates and notices asit may consider expedient in connection with such borrowings or indebtedness inthe nature of borrowings. . By Order of the Board Andy Taylor, Executive Chairman Registered office: Sanctuary House, 45-53 Sinclair Road, London W14 0NS This information is provided by RNS The company news service from the London Stock Exchange