Notice of EGM

Globalworth Real Estate Investments Limited

Notice of EGM

Globalworth Real Estate Investments Limited (the "Company") announces that an Extraordinary General Meeting ("EGM") of the Company will be held at 10.00 a.m. on 31 August 2017 at Ground Floor, Dorey Court, Admiral Park, St Peter Port, Guernsey, GY1 2HT.

The purpose of the EGM is to ask Shareholders to authorise the Board, as permitted by and in accordance with the Articles, to exercise the powers of the Company to issue, grant options to subscribe for, or to convert any securities into, shares in the Company and to authorise the Board to be able to offer Shareholders the opportunity to elect to receive scrip dividends in the form of Shares instead of a cash dividend (a "Scrip Dividend").

Copies of the circular containing the Notice of EGM (the "Circular") have been posted to Shareholders. In addition to containing the Notice of EGM, the Circular also contains an explanation of each resolution being proposed and the recommendation of the Board to vote in favour of each resolution.

A full copy of the Circular can be found here: 

www.globalworth.com/investor-relations/key-corporate-documents.aspx

For further information visit www.globalworth.com or contact:

About Globalworth

Globalworth is a real estate investment company active in the SEE and CEE regions with a prime focus on Romania. The Company is internally managed by c.70 professionals and its portfolio comprises high quality real estate investments valued at c. Euro 983.3 million at 31 March 2017, all located in Romania.

EXTRACT FROM CIRCULAR

1. Introduction

Under the Articles, the Board may, with the authority of Shareholders given at a general meeting, exercise the powers of the Company to issue, grant options to subscribe for, or to convert any securities into, shares in the Company and may offer Shareholders the opportunity to elect to receive scrip dividends in the form of Shares instead of a cash dividend (a "Scrip Dividend").

This Circular contains a notice of extraordinary general meeting at which resolutions will be proposed to grant those authorities, an explanation of each resolution and the recommendation of the Board to vote in favour of each resolution.

2. Authority to issue Shares

Under the Articles, the Directors are generally and unconditionally authorised to exercise all powers of the Company to issue, grant rights to subscribe for, or to convert any securities into, shares in the Company pursuant to the Plan and otherwise to issue, grant rights to subscribe for, or to convert any securities into, such number of shares of such class in the Company during such period as shall from time to time be authorised by ordinary resolution. An authority granted by Shareholders to that effect on 16 December 2016 expired at the 2017 AGM.

Proposed Resolution 1 sets out the terms of a proposed renewal of the approval from Shareholders to authorise the Directors to issue, grant rights to subscribe for, or convert any security into, shares in the Company up to a maximum aggregate of 55,903,954 Shares which represents approximately two-thirds of the Company's issued share capital as at the date of this Circular. The authority set out in proposed Resolution 1 is intended to provide the Board with authority to issue shares in the Company (or grant rights to subscribe for, or convert securities into, shares in the Company) to allow flexibility to support the Company's commercial objectives through equity finance in suitable circumstances. The authority will expire at the conclusion of the Annual General Meeting of the Company in 2018 unless the authority is varied, revoked or renewed prior to such time or at the 2018 AGM. In addition, the resolution will permit the Directors to make an offer or agreement prior to the expiry of the authority which would or might require Shares to be issued or rights to subscribe for or to convert any securities into Shares to be granted after such expiry and the Directors may issue Shares or grant such rights under any such offer or agreement as if the authority had not expired.

3. Disapplication of pre-emption rights

Before the Directors may issue new Shares, or rights to subscribe for, or to convert securities into, Shares ("Equity Securities") for cash, the Articles require that such Equity Securities are first offered to the Shareholders in proportion to their existing holdings. The pre-emption rights under the Articles do not apply to:

(i) the issue of Shares pursuant to the Plan;

(ii) the issue of Shares pursuant to the exercise of any Equity Securities issued in accordance with the warrant instrument executed by the Company as a deed poll dated 24 July 2013; and

(iii) the issue of any Shares pursuant to any scrip dividend scheme implemented by the Company in accordance with the Articles, or any pro-rata bonus issue of Shares.

The Statement of Principles issued by The Pre-Emption Group is a statement of principles to be taken into account by companies when considering the case for disapplying pre-emption rights. The Statement of Principles recommends that shareholders authorise the disapplication of pre-emption rights for issues representing no more than 5% of the issued ordinary share capital of a company in any one year and no more than an additional 5% of the issued ordinary share capital in connection with a specified acquisition or capital investment which is announced contemporaneously with the issue, or which has taken place in the preceding six-month period and is disclosed in the announcement of the issue, and that a company should not issue non-pre-emptively for cash equity securities that represent more than 7.5% of its issued ordinary share capital in any three-year period (subject to certain exceptions).

Articles 5.2.1, 5.2.3 and 5.2.4 of the Articles permit a partial disapplication of the pre-emption rights contained in the Articles by special resolution of the Shareholders with respect to an issue of Shares:

(i) in connection with any acquisition by the Company or any member of the Group (a) to the extent that claw-back participation is offered to Shareholders pursuant to and consistent with the Statement of Principles or (b) up to a maximum aggregate of 6,779,771 Shares or, if greater, the maximum number of Shares equal to that comprised within any claw-back participation offered to existing Shareholders pursuant to and consistent with the Statement of Principles (the "Acquisition Share Authority");

(ii) pursuant to any employee emolument arrangements of the Company (other than the Plan), up to a maximum aggregate of 6,779,771 Shares; and

(iii) up to a maximum aggregate of 6,779,771 Shares or, if greater, the maximum number of Shares equal to that comprised within the Acquisition Share Authority for any other purpose, in each case, during such period and subject to such variation as shall from time to time be authorised by way of special resolution of the Shareholders.

Authorities to the same effect were granted by Shareholders on 16 December 2016 and expired at the 2017 AGM.

Proposed Resolution 2 authorises the Directors to issue Shares pursuant to the authority given in proposed Resolution 1 as if the pre-emption provisions of Article 5.1 of the Articles did not apply in respect of any issue of Shares referred to in Articles 5.2.1, 5.2.3 or 5.2.4, in each case up to the maximum aggregate of 6,779,771 Shares, provided that such authority will expire at the conclusion of the Annual General Meeting of the Company in 2018. In addition, the Directors may make an offer or agreement pursuant to the authority prior to the expiry of the authority which would or might require Shares to be issued or rights to subscribe for or to convert any securities into Shares to be granted after such expiry and the Directors may issue Shares or grant such rights under any such offer or agreement as if the authority had not expired.

4. Scrip Dividend Authority

The Board believes that the ability for holders of Shares to elect to receive dividends from the Company wholly or partly in the form of new Scrip Dividend Shares rather than cash is likely to benefit both the Company and certain holders of Shares. If holders of Shares on the register of members of the Company at a relevant Record Date, other than Shareholders excluded from the relevant scrip dividend offer by reason of jurisdictional requirements (as determined by the Board and notified to the Shareholders from time to time),  (the "Qualifying Shareholders") do elect to receive the new Scrip Dividend Shares where a future scrip dividend is declared, the Company will benefit from the ability to retain the cash which would otherwise have been paid out as dividends while Shareholders have the opportunity to increase their Shareholdings without dealing costs at a pre-determined price per Share.

In order to be able to offer a Scrip Dividend election in connection with any dividend, the Articles provide that the Board must have the authority of the Shareholders by way of ordinary resolution. In order to provide the Directors the flexibility to offer a Scrip Dividend election in the future, Resolution 3 contains an authority, subject to the provisions of the Articles, to offer holders of Shares the right to elect to receive Shares instead of the whole (or some part, to be determined by the Board) of any dividend declared by the Company, such authority to expire at the conclusion of the fifth Annual General Meeting after the passing of the resolution.

Participation in any future Scrip Dividend election will be entirely voluntary. The terms and conditions of any Scrip Dividend election offered by the Company in the future will be set out in a suitable communication with Shareholders at the time of any such offer.

5. Dividend Reinvestment Plan

The Board is also considering offering, in the alternative to any Scrip Dividend, a dividend reinvestment plan (a "DRIP") where a Qualifying Shareholder may elect that the Company applies cash dividends on the holder's behalf to purchase additional Shares on behalf of the holder through a special dealing arrangement on or after the payment date for the relevant dividend.

The purchase of additional Shares in the market avoids dilution of existing holders of Shares and provides an efficient and convenient reinvestment option for holders of Shares, without the Company issuing new Shares.

Participation in any future DRIP will be entirely voluntary. The terms and conditions of any DRIP election offered by the Company in the future will be set out in a suitable communication with Shareholders at the time of any such offer. 

6. Extraordinary General Meeting

A notice convening an Extraordinary General Meeting of the Company to be held at the registered office of the Company at Ground Floor, Dorey Court, Admiral Park, St Peter Port, Guernsey GY1 2HT, at 10.00 am on 31 August 2017 is set out at the end of this document. The purpose of the Extraordinary General Meeting is to seek the approval of Shareholders for the authorities to issue Shares and disapplication of pre-emption rights described in this Circular and to confer authority on the Directors to offer Scrip Dividend elections in the future.

7. Action to be Taken

Shareholders will find enclosed with this document a Form of Proxy for use in connection with the Extraordinary General Meeting.

Shareholders, whether or not they propose to attend the Extraordinary General Meeting in person, are requested to complete, sign and return the enclosed Form of Proxy, in accordance with the instructions printed on it, so as to be received by the registrars of the Company, Capita Asset Services, PXS1, 34 Beckenham Road, Beckenham, Kent BR3 4TU, not less than 48 hours before the time appointed for the meeting (not taking account of any part of a day which is not a business day in London and Guernsey), being 10.00 am on 29 August 2017. Completion and return of a Form of Proxy by a Shareholder will not preclude that Shareholder from attending, speaking and/or voting in person at the Extraordinary General Meeting should they so wish.

8. Recommendation

The Directors consider that the Resolutions to be proposed at the Extraordinary General Meeting, are in the best interests of the Company and its Shareholders as a whole.

DEFINITIONS

In addition to the terms defined in the Chairman's letter, the following terms shall have the meanings set out next to them when used in this document (including the Chairman's letter), unless the context otherwise requires: