TIDMEDGC
RNS Number : 5842O
Edge Performance VCT PLC
30 June 2010
Edge Performance VCT plc
Incorporated in England & Wales
with registration number 5558025
Annual Report & Financial Statements
for the year ended 28 February 2010
Contents
Financial Summary
1
Investment Policy
2
Chairman's Statement
3
The Directors & Investment Manager
5
Investment Manager's Review
7
Investment Portfolios
11
Venture Capital Investments
12
Directors' Report
14
Directors' Remuneration Report
19
Statement of Corporate Governance
21
Statement of Directors' Responsibilities
24
Report of the Independent Auditor
25
Income Statement
27
Balance Sheet
29
Reconciliation of Movements in
Shareholders' Funds
31
Cash Flow Statement
32
Notes to the Financial Statements
33
2010 Annual General Meeting
and Class Meetings
42
Corporate Information
54
Financial Summary
2010
+------------+--------+--------+--------+--------+--------+--------+--------+---------+
| | | | | 2010 | 2010 | 2010 | 2010 | 2010 |
+------------+--------+--------+--------+--------+--------+--------+--------+---------+
| Year | | | | *O | C | D | E | Total |
| ended | | | | | | | | |
| 28 | | | | | | | | |
| February | | | | | | | | |
+------------+--------+--------+--------+--------+--------+--------+--------+---------+
| Net | | | | 0 | 10,102 | 16,431 | 8,998 | 35,531 |
| assets | | | | | | | | |
| GBP'000 | | | | | | | | |
+------------+--------+--------+--------+--------+--------+--------+--------+---------+
| Net | | | | 0.00 | 75.80 | 85.45 | 91.68 | n/a |
| asset | | | | | | | | |
| value | | | | | | | | |
| per | | | | | | | | |
| share, | | | | | | | | |
| p | | | | | | | | |
+------------+--------+--------+--------+--------+--------+--------+--------+---------+
| Net | | | | 85.00 | 89.80 | 92.45 | 91.68 | n/a |
| asset | | | | | | | | |
| value | | | | | | | | |
| total | | | | | | | | |
| return | | | | | | | | |
| per | | | | | | | | |
| share, | | | | | | | | |
| p | | | | | | | | |
+------------+--------+--------+--------+--------+--------+--------+--------+---------+
| Investment | | | | 5 | 60 | 73 | 18 | 156 |
| income | | | | | | | | |
| GBP'000 | | | | | | | | |
+------------+--------+--------+--------+--------+--------+--------+--------+---------+
| | | | | | | | | |
+------------+--------+--------+--------+--------+--------+--------+--------+---------+
| Return | | | | | | | | |
| on | | | | | | | | |
| ordinary | | | | | | | | |
| activities | | | | | | | | |
| before tax | | | | | | | | |
| GBP'000 | | | | | | | | |
+------------+--------+--------+--------+--------+--------+--------+--------+---------+
| - | | | | (57) | (87) | (235) | (110) | (489) |
| Revenue | | | | | | | | |
+------------+--------+--------+--------+--------+--------+--------+--------+---------+
| - | | | | (197) | (314) | (153) | (54) | (718) |
| Capital | | | | | | | | |
+------------+--------+--------+--------+--------+--------+--------+--------+---------+
| - | | | | (254) | (401) | (388) | (164) | (1,207) |
| Total | | | | | | | | |
+------------+--------+--------+--------+--------+--------+--------+--------+---------+
| | | | | | | | | |
+------------+--------+--------+--------+--------+--------+--------+--------+---------+
| Return | | | | | | | | |
| per | | | | | | | | |
| share, | | | | | | | | |
| p | | | | | | | | |
+------------+--------+--------+--------+--------+--------+--------+--------+---------+
| - | | | | (0.90) | (0.65) | (1.23) | (1.24) | n/a |
| Revenue | | | | | | | | |
+------------+--------+--------+--------+--------+--------+--------+--------+---------+
| - | | | | (3.08) | (2.36) | (0.79) | (0.62) | n/a |
| Capital | | | | | | | | |
+------------+--------+--------+--------+--------+--------+--------+--------+---------+
| - | | | | (3.98) | (3.01) | (2.02) | (1.86) | n/a |
| Total | | | | | | | | |
+------------+--------+--------+--------+--------+--------+--------+--------+---------+
| | | | | | | | | |
+------------+--------+--------+--------+--------+--------+--------+--------+---------+
| Dividend | | | | | | | | |
| per | | | | | | | | |
| share | | | | | | | | |
| declared | | | | | | | | |
| in | | | | | | | | |
| respect | | | | | | | | |
| of the | | | | | | | | |
| year, p | | | | | | | | |
+------------+--------+--------+--------+--------+--------+--------+--------+---------+
| - | | | | 0.00 | 0.00 | 0.00 | 0.00 | n/a |
| Revenue | | | | | | | | |
+------------+--------+--------+--------+--------+--------+--------+--------+---------+
| - | | | | 0.20 | 7.00 | 7.00 | 7.00 | n/a |
| Capital | | | | | | | | |
+------------+--------+--------+--------+--------+--------+--------+--------+---------+
| - | | | | 0.20 | 7.00 | 7.00 | 7.00 | n/a |
| Total | | | | | | | | |
+------------+--------+--------+--------+--------+--------+--------+--------+---------+
| | | | | | | | | |
+------------+--------+--------+--------+--------+--------+--------+--------+---------+
| Share | | | | n/a | 71.5 | 77.5 | 85.0 | n/a |
| price | | | | | | | | |
| at end | | | | | | | | |
| of | | | | | | | | |
| year, | | | | | | | | |
| p | | | | | | | | |
+------------+--------+--------+--------+--------+--------+--------+--------+---------+
*For period from 1 March 2009 to 21 December 2009 when the ordinary shares were
converted to deferred shares and then cancelled.
2009
+------------+--------+--------+--------+--------+--------+--------+--------+--------+
| | | | | 2009 | 2009 | 2009 | 2009 | 2009 |
+------------+--------+--------+--------+--------+--------+--------+--------+--------+
| Year | | | | O | C | D | E | Total |
| ended | | | | | | | | |
| 28 | | | | | | | | |
| February | | | | | | | | |
+------------+--------+--------+--------+--------+--------+--------+--------+--------+
| Net | | | | 4,422 | 10,504 | 18,165 | - | 33,091 |
| assets | | | | | | | | |
| GBP'000 | | | | | | | | |
+------------+--------+--------+--------+--------+--------+--------+--------+--------+
| Net | | | | 69.09 | 78.81 | 94.47 | - | n/a |
| asset | | | | | | | | |
| value | | | | | | | | |
| per | | | | | | | | |
| share, | | | | | | | | |
| p | | | | | | | | |
+------------+--------+--------+--------+--------+--------+--------+--------+--------+
| Net | | | | 89.09 | 92.81 | 94.47 | - | n/a |
| asset | | | | | | | | |
| value | | | | | | | | |
| total | | | | | | | | |
| return | | | | | | | | |
| per | | | | | | | | |
| share, | | | | | | | | |
| p | | | | | | | | |
+------------+--------+--------+--------+--------+--------+--------+--------+--------+
| Investment | | | | 63 | 484 | 370 | - | 917 |
| income | | | | | | | | |
| GBP'000 | | | | | | | | |
+------------+--------+--------+--------+--------+--------+--------+--------+--------+
| | | | | | | | | |
+------------+--------+--------+--------+--------+--------+--------+--------+--------+
| Return | | | | | | | | |
| on | | | | | | | | |
| ordinary | | | | | | | | |
| activities | | | | | | | | |
| before tax | | | | | | | | |
| GBP'000 | | | | | | | | |
+------------+--------+--------+--------+--------+--------+--------+--------+--------+
| - | | | | (30) | 262 | 120 | - | 352 |
| Revenue | | | | | | | | |
+------------+--------+--------+--------+--------+--------+--------+--------+--------+
| - | | | | (139) | (615) | (64) | - | (818) |
| Capital | | | | | | | | |
+------------+--------+--------+--------+--------+--------+--------+--------+--------+
| - | | | | (169) | (353) | 56 | - | (466) |
| Total | | | | | | | | |
+------------+--------+--------+--------+--------+--------+--------+--------+--------+
| | | | | | | | | |
+------------+--------+--------+--------+--------+--------+--------+--------+--------+
| Return | | | | | | | | |
| per | | | | | | | | |
| share, | | | | | | | | |
| p | | | | | | | | |
+------------+--------+--------+--------+--------+--------+--------+--------+--------+
| - | | | | (0.37) | 1.55 | 0.55 | - | n/a |
| Revenue | | | | | | | | |
+------------+--------+--------+--------+--------+--------+--------+--------+--------+
| - | | | | (2.14) | (4.34) | (0.16) | - | n/a |
| Capital | | | | | | | | |
+------------+--------+--------+--------+--------+--------+--------+--------+--------+
| - | | | | (2.51) | (2.79) | 0.39 | - | n/a |
| Total | | | | | | | | |
+------------+--------+--------+--------+--------+--------+--------+--------+--------+
| | | | | | | | | |
+------------+--------+--------+--------+--------+--------+--------+--------+--------+
| Dividend | | | | | | | | |
| per | | | | | | | | |
| share | | | | | | | | |
| declared | | | | | | | | |
| in | | | | | | | | |
| respect | | | | | | | | |
| of the | | | | | | | | |
| year, p | | | | | | | | |
+------------+--------+--------+--------+--------+--------+--------+--------+--------+
| - | | | | - | 1.75 | 0.30 | - | n/a |
| Revenue | | | | | | | | |
+------------+--------+--------+--------+--------+--------+--------+--------+--------+
| - | | | | 71.80 | 5.25 | 6.70 | - | n/a |
| Capital | | | | | | | | |
+------------+--------+--------+--------+--------+--------+--------+--------+--------+
| - | | | | 71.80 | 7.00 | 7.00 | - | n/a |
| Total | | | | | | | | |
+------------+--------+--------+--------+--------+--------+--------+--------+--------+
| | | | | | | | | |
+------------+--------+--------+--------+--------+--------+--------+--------+--------+
| Share | | | | 80.00 | 90.00 | 100.00 | n/a | n/a |
| price | | | | | | | | |
| at end | | | | | | | | |
| of | | | | | | | | |
| year, | | | | | | | | |
| p | | | | | | | | |
+------------+--------+--------+--------+--------+--------+--------+--------+--------+
Investment Policy
Edge Performance VCT plc ("Edge" or the "Company") has pioneered an approach
which was designed to address the key issues which we believe have in the past
deterred some individuals from investing in VCTs, namely the ability to exit
from the VCT once the investment has been held for five years, and the perceived
level of risk of the underlying investments. Edge Performance seeks to allow
investors to take advantage of VCT tax reliefs whilst combining:
- high targeted returns;
- downside risk protection; and
- liquidity.
Risk Diversification
Using the skills of the Directors and the investment team of the Manager who
collectively have a depth of experience in the entertainment industry, Edge
Performance was established for the purpose of investing in the entertainment
industry, initially concentrating on companies which promote live music,
theatre, sports, festivals, trade shows, exhibitions and other events where
people attend in person, and subsequently seeking to invest in the broader
entertainment sector.
Asset Allocation
In respect of each of each of the C share, D share, E share and F share funds,
approximately 30% of each fund is to remain in a range of fixed income
securities and cash and cash equivalent assets, offering a high degree of
capital preservation.
With the balance of each fund, the Company looks to pursue opportunities in the
entertainment industry which the Manager believes are complementary to the
investment strategy of the Company. Of the balance of each fund, some will also
be invested in events companies which have concluded event licensing agreements
with established promoters under which the revenues received by the events
company from the events promoted with that promoter will be at least 75% of the
aggregate of the amount invested by Edge in the events company, and some is to
be invested under arrangements offering more modest minimum guaranteed returns,
but with significantly higher potential returns. Typically, the maximum amount
of Edge Performance's investment in each company as is permitted under VCT rules
will be in the form of loan stock secured by a debenture and the balance will be
in equity.
For each of the C share, D share, E share and F share funds, the targeted tax
free return is 160p per 100p invested (assuming tax relief at 30%, equivalent to
a return of 130p per 70p invested, net of income tax).
Risk Mitigation
Edge Performance's structure provides for investments to be blended with the
intention that the investor's risk is minimised, whilst still permitting the
investor to benefit from attractive returns by utilising arrangements that seek
to combine high targeted returns with reduced downside risk and enhanced
liquidity. The majority of the portfolio investments will be made through loan
finance which should provide additional capital protection.
Early Return of Capital
It is intended that investments will be organised so as to allow the possibility
for their realisation, and, if Shareholders so desire, the return of capital to
Shareholders shortly after five years, the minimum holding period for each class
of Shares in order to retain the full amount of income tax relief.
Borrowings
It is not intended that the Company will incur borrowings to fund its
operations.
VCT Status and Maximum Exposure
The Company must be approved by HM Revenue and Customs in order to retain its
venture capital trust status. The conditions which must be satisfied to retain
such status include the following restrictions on the maximum exposure of the
Company:
(i) not more than 15% by value of the Company's investments can be held
in a single company or group (other than a VCT); and
(ii) the Company is limited to investing up to GBP1 million per year per
VCT qualifying holding.
Investment Manager
The Company's investment manager is Edge Investment Management Limited ("EIM" or
"Manager").
Chairman's Statement
Overview
I am pleased to be able to report that the year ended 28 February 2010 has been
both busy and successful for the Company.
When the Company launched in 2006, we knew it would be in the interests of the
Company to gain some scale, with the benefits of increased deal flow, improved
infrastructure and reduced shared costs that size can bring.
We took the view that key to growing the business was ensuring that our
shareholders see a relatively predictable and timely return of funds. We felt,
and still feel, that investors in Edge Performance VCT want to see actual cash
returns, not just paper gains.
Timely Return of Cash to Investors
Since its launch in 2006, the Company has distributed a total of GBP8.65m in
cash to shareholders. In addition, the Board has now recommended further
dividends totalling GBP2.97m to be paid to C, D and E shareholders in November
this year.
In particular, this year marked a significant milestone with the realisation of
the investment portfolio of the Company's 2006 Ordinary share pool and the
timely return of cash in June 2009 to the Ordinary shareholders.
When we launched our original Ordinary share offer in 2006, we targeted a total
return of 75p per share on a net cost of investment (after tax relief of 40%) of
60p per share. In the event, the actual total return, at 85p per share, exceeded
the target by some way.
C shareholders have so far received annual dividends totalling 14p per share,
with a third dividend of 7p per share now recommended by the Board.
The Company has paid D shareholders their first annual dividend of 7p per share,
and a second dividend of 7p per share has been recommended.
The Board has now recommended the payment to the E shareholders of their maiden
annual dividend of 7p per share.
Our success in delivering returns to shareholders both on time and ahead of
target has been well received by our investors and the IFA community alike.
Investment Programme
During the year, the Company met the requirement under the VCT rules that it
satisfy the 70% test (whereby at least 70% of the investments by value should be
in VCT qualifying holdings) with regard to the funds raised in respect of the
issue of C and D shares in the year ended 28 February 2007. The focus of those
funds has now turned to monitoring the performance of the investment portfolio,
with a view to achieving suitable returns to C and D shareholders by the time
the portfolios mature.
Significant progress was also made, both during and after the year, towards full
investment of the D share pool; likewise,
a series of discussions are well advanced which we believe will lead to a
substantial proportion of the E share pool having been invested by the end of
2010.
Fundraising
2009 was a very difficult year for raising funds across the VCT sector. However,
despite the challenging market conditions the Company's E share offer, which
opened in November 2008, raised over GBP9.7m against a target of GBP10m, which
the Board feels was a more than satisfactory outcome.
During the year, the F share offer was launched, seeking to raise a further
GBP10m. By the time the offer closed in June 2010, the total raised exceeded
GBP29m. Whilst the overall size of the VCT fundraising market increased, the
Company also significantly increased its share of this market. The Company has
now raised GBP78m since inception.
VCT Legislation
Shareholders will be aware that the Government intends to bring in new VCT rules
intended to harmonise the UK with the rest of the European Union. Certain of
these changes will require the Company - in common with all other VCTs - to
rethink the structure of future investments. Other changes, however, will open
the door to many possibilities not previously available to VCTs; the proposed
relaxation of the restrictions on VCTs investing in foreign businesses will, we
believe, provide fertile new ground for investment opportunities.
Beyond that, there is an ongoing process of consultation with the Government
over further changes in the VCT rules, including possible significant increases
in both the amount which a VCT can invest in a business, and in the size of a
business in which a VCT can invest. The Board welcomes such changes and the
Company is actively involved in that consultation process, not only through its
trade association, but also direct with Government.
Outlook
With the amount of funds now under management, the continued quality of deal
flow which the Manager is seeing and the extensive collective experience and
expertise of the Board and the Manager, I believe that the coming few years will
be both exciting and rewarding for the Company and its shareholders.
I thank you for continued support of the Company.
Sir Robin Miller
Chairman
30 June 2010
The Directors and Investment Manager
The collective experience of the directors of the Company ("Directors") and the
Manager's investment team - which covers VCT fund management, venture capital,
investment banking, live event promotion, corporate finance, private equity,
artist management, legal and business affairs, accountancy, tax and deal
structuring skills - will be employed in the selection and management of the
Company's investments.
The Company has the following directors, all non-executive, who are responsible
for overseeing investment policy and will have overall responsibility for the
Company's activities. The Directors are, with the exception of David Glick,
independent
of the Manager.
Directors
Sir Robin Miller - Chairman
Robin was formerly Chief Executive (1985-98 and 2001-03) and Chairman
(1998-2001) of Emap plc, one of the UK's leading media groups with businesses
including consumer and trade publishing, commercial radio and music TV channels
and events.
In 2003, Robin became senior media advisor to HgCapital, and was involved in the
successful disposal of Boosey & Hawkes and Clarion Events Limited. He has also
been Non Executive Director of Channel Four Television (1999-2006), and was
Chairman of their New Business Board, was Non Executive Chairman of the HMV
Group (2004-2005), Senior Non Executive Director at Mecom Group plc (2005-2009),
Chairman of Entertainment Rights plc (2008-2009), and Setanta Sports in 2009.
Robin is currently a Non Executive Director of The Racing Post and Time Out
Group, Chairman of IBIS Media VCT plc, Edge VCT plc, Getmemedia.com Limited,
Golf Club Network and Crash Media Group, is a Director of Bikesportnews.com and
a Trustee of the Golf Foundation and Riders for Health.
Michael Eaton
Michael Eaton is a qualified (non-practising) solicitor and was a partner at
City law firm Stephenson Harwood. In 1977 he joined the Dick James Music
Organisation where he was responsible for the legal and administrative aspects
of its publishing, recording and management activities. In 1979, he formed Eaton
& Co. (subsequently re-named Eaton & Burley), a firm of solicitors specialising
in the music industry, and in 1990 he was a co-founder of Eatons, a leading
music and entertainment law firm, with David Glick.
In 2000, he founded MusicLore which has provided business, management and legal
advice to some of the world's leading recording and performing artists.
He has throughout his career acted for numerous highly successful popular music
artists, including Eric Clapton, the Bee Gees, the Police, Enya and Frankie Goes
to Hollywood, in negotiations with record companies, concert promoters and other
entertainment entities in North America as well as Europe. He has also
represented a number of successful businesses in the entertainment sector, such
as Northern Songs, the Beatles' music publishing company. More recently he has
represented Eric Clapton in relation to his world-wide touring activities and
was one of the main organisers of the Crossroads Guitar Festivals in Dallas in
2004 and in Chicago in 2007. He is currently Chief Executive Officer of
Bushbranch Limited, a music management company providing management services to
Eric Clapton.
David Glick
David Glick, who is a qualified (non-practising) solicitor, specialises in
commercial media and entertainment advice and investment with a particular
emphasis on music, television, film, sport, theatre and fashion.
David Glick co-founded Eatons, a leading music and entertainment law firm, in
1990; in 2000 Eatons merged with law firm Mishcon de Reya where he became head
of the entertainment and media group. In 2004 he formed the Edge Group of
companies as a specialist investment and advisory business for the media and
entertainment sector. Edge's clients have ranged from highly successful popular
music artists to leading fashion designers and include major and independent
entertainment businesses. At Edge he has brokered and advised clients on the
sale and purchase of a range of entertainment related assets and businesses. He
has also been both an executive and a non-executive director of Entertainment
Rights, the UK media business which was quoted on the Official List. He is the
founder of Edge Performance and is married to Kate Glick.
Julian Paul FCA
Julian Paul is a chartered accountant and ex-merchant banker who has held a
number of senior positions with companies in the media and entertainment sector.
He was Deputy Chairman and a founder shareholder of Eagle Rock Entertainment:
Eagle Rock, which is now majority-owned by its management following a secondary
buy-out in 2007 and which operates in the music and entertainment business. It
acquires and creates audio and visual programming rights, both music and
factual, and exploits these rights through the release of own-label CDs and DVDs
and through the licensing of these rights for TV and other media. Eagle Rock has
a production arm which produces live concert programming for distribution for
TV, DVD and other media including concerts by Yes, Atomic Kitten and Fat Boy
Slim.
He was, between 1994 and 1999, a shareholder and director and subsequently a
consultant to Sanctuary Group which acted as manager to Iron Maiden amongst
other artists. Other current directorships include Cellcast, an AIM quoted
digital interactive broadcaster; Pilat Media Global, an AIM quoted broadcasting
application software business; and Stagecoach Theatre Arts, an AIM quoted
franchisor of performing arts schools.
Frank Presland
Frank Presland practised as a solicitor for 25 years, specialising in music and
copyright. He advised numerous musicians including The Beatles, Dusty
Springfield, The Troggs, Terence Trent D'Arby and Elton John as well as music
publishing companies including BMG Music Publishing Limited and record companies
including RCA Records. He became senior partner of law firm Frere Cholmeley
Bischoff and later became joint chairman of the national law firm, Eversheds.
In 1999 he established and became chief executive officer of Twenty-First
Artists, a music management company providing management services to artists
including Elton John, Lily Allen and James Blunt. From May 2006 to April 2008,
he was Chief Executive Officer of The Sanctuary Group plc, in which role he
brokered the sale of the Group to Universal Music in 2007.
The Investment Manager
The investment manager of the Company is Edge Investment Management Limited
("EIM") which was established in July 2005 for the purpose of managing the
investments of Edge. The members of the EIM investment team are all directors of
EIM; their details (other than those of David Glick, who is also a director of
Edge and whose details are shown above) are as follows:
Gordon Power - Chairman of Edge Investment Management
Gordon Power - has 24 years of private equity experience and is currently
chairman of Edge Investment Management and a private equity investor in his own
right.
Prior to this he founded the private equity business ProVen Private Equity (now
re-named Beringea) and led its buy-out from Guinness Mahon in 1997. As CEO of
ProVen from 1984 until 2004, he spearheaded the creation and marketing of funds
and the investment and exit of deals as head of the investment committee. By
2002 ProVen, which specialised in media and intellectual property rights
investments, had funds under management of GBP185 million including Guinness
Flight VCT, ProVen VCT and ProVen Media VCT (now re-named ProVen Growth and
Income VCT). From 1984 until March 2008, an overall annual return of 29% was
achieved on 171 realised (i.e. sale, flotation or administration/liquidation)
investments and unrealised investments.
Harvey Goldsmith CBE
Harvey Goldsmith is one of the UK's best known music industry impresarios,
having since the 1960s produced and promoted shows with leading artists such as
The Rolling Stones, The Who, Bruce Springsteen, The Eagles, Led Zeppelin and
Sting. He formed Artiste Management Productions in 1973 to produce and manage
music artists, and Harvey Goldsmith Entertainments Limited in 1976, which became
the UK's leading promoter of concerts and events. He became involved in the
Prince's Trust in 1982, producing the first Prince's Trust Rock Gala, and
joining the Trust's board. In 1985, he produced the Live Aid concert with Sir
Bob Geldof, raising GBP140 million for famine relief in Africa and the more
recent Live 8 concert in 2005. He has also produced major operatic productions
and was the worldwide tour producer for Pavarotti. He is responsible for the
annual Cirque du Soleil shows in the UK, is the co-producer of Merchants of
Bollywood and was the instigator and producer of the Led Zeppelin reunion
concert at the O2 Arena in London in December 2007.
Alasdair George
Alasdair George is a qualified (non-practising) solicitor who has extensive
experience of legal, strategic, commercial and operational management in the
entertainment industry, having been Senior Vice President of Legal & Business
Affairs at Sony BMG Music UK, sitting on its management board, and on the
Council of the UK record trade association, the BPI. He handled the merger of
Sony Music and Warner Music's distribution businesses, the UK aspects of the
Sony BMG merger and the Sony-Michael Jackson joint venture (which created
Sony/ATV Music Publishing). He joined Edge Investment Management in early 2007.
Kate Glick ACA, CTA
Kate Glick qualified as a chartered accountant and chartered tax adviser with
Arthur Andersen where she worked from 1991 until 2002 and is also a member of
the Securities & Investment Institute. Her experience at Arthur Andersen
included insolvency and turnaround advice and latterly tax advice on areas
including capital gains tax, trust and other personal tax matters. She is
company secretary of the Edge Group of companies and has been responsible for
the accounting function at the group; she has also advised Edge clients on
accountancy and tax-related issues. She is the Company Secretary of Edge
Investment Management. She holds a BA in Economics from Cambridge University and
is married to David Glick.
Investment Manager's Review
Investment Overview
At the end of the year, the portfolio consisted of:
> investments in six qualifying companies made by the C Share fund
> investments in three qualifying companies made by the D Share fund
Additionally, four further investments, for a total of GBP4 million, were
committed by the year end and completed in April 2009, and
in each case with Edge Performance VCT having an option to make an additional
investment towards the end of 2010.
With its final investments during the year, the Company met the requirement
under the VCT rules that it satisfy the 70% test (whereby at least 70% of the
investments by value should be in VCT qualifying holdings) with regard to the
funds raised in respect of the issue of C and D shares in the year ended 28
February 2007.
The investments which were made during and following the year mean that almost
80% of that portion of the D Share fund required to be invested in VCT
qualifying holdings has now been invested, and the remainder will be invested
during the year to 28 February 2011.
The Manager reviewed investment opportunities in a number of different
entertainment businesses over the year, encompassing opportunities in recorded
music, music publishing, radio, social networking, festivals, exhibitions,
gaming and sports events, amongst others.
Consistent with its blended investment strategy for the C, D and E Share pools,
in the year, Edge Performance VCT also continued to look to invest part of its
funds in events companies, each of whose business is the promotion and
organisation of shows, concerts, tours, festivals, exhibitions and other events
before live audiences, and the marketing, advertising, promotion and management
of those events. The events companies in which Edge Performance VCT has invested
have in turn contracted with one of two established promoters, SJM Limited or
AEG Live (UK) Limited, to acquire the right to promote live events, selected by
the relevant events company, over a defined period of time.
Performance
As at 28 February 2010, the NAV total return of each of the share funds stood
at:
C Share fund: 89.80p per share (92.81p per share as at 28
February 2009)
D Share fund: 92.45p per share (94.47p per share as at 28
February 2009)
E Share fund: 91.68p per share (2009: not applicable)
Realisation of Ordinary Share Fund Investments
One of the most significant events in the year was the realisation of the
qualifying investments made by the Ordinary Share fund, and the return of
capital to Ordinary shareholders.
VCT rules required Edge Performance VCT's Ordinary shareholders to hold their
shares until at least April 2009. The Board and Manager had previously announced
their intention to realise the Ordinary Share portfolio in order to facilitate
the return of capital to Ordinary shareholders as soon as possible after the end
of that minimum holding period.
To that end, three of the Ordinary Share fund's five qualifying investments were
disposed of in May 2009, and the remaining two in June 2009, realising in total
in excess of GBP4.12 million. The proceeds of those realisations, together with
the remaining net assets of the Ordinary Share fund, were distributed to
Ordinary shareholders in June 2009, with a final residual distribution to
shareholders in November 2009.
These distributions brought the total return per Ordinary Share to GBP0.85 for a
net GBP0.60 per share cost of investment (assuming income tax relief at 40%),
equivalent to a return of GBP1.25 per GBP1.00 invested. This return, which
represented an IRR of 12.01%, was significantly ahead of the targeted return of
GBP0.75 per Ordinary share.
In a three year period where the value of many other types of investment has
fallen dramatically, the Manager regards this as a highly satisfactory result.
Given the support for Edge Performance VCT's subsequent F Share fundraising, it
would appear that the market agrees with this.
Following the final distribution to Ordinary shareholders, the net asset value
of the Ordinary Share fund was zero. Edge Performance VCT therefore looked to
put into effect a quick and cost-effective method of avoiding ongoing costs
associated with continuing to maintain the Ordinary Share class. Accordingly, in
December 2009, Edge Performance VCT converted the Ordinary Shares into deferred
shares and immediately repurchased them.
Qualifying Investments made before or during the Year
B & W Events Limited
Edge Performance VCT invested GBP1,000,000 in B & W Events in September 2009.
The founder of B & W Events is Andrew Wilkinson. A member of the Rolling Stones
management team until 1987, Andrew then set up Kingstreet Tours, initially to
produce concert tours by existing management clients such as the Rolling Stones
and Pink Floyd. Subsequently, Andrew became manager of Bill Wyman, whilst at the
same time continuing to develop the speciality of concert tour management and
production. Since its formation, Kingstreet has produced tours for acts such as
Billy Joel, Elton John, Genesis, Phil Collins, Robbie Williams, the Spice Girls,
Sting and Whitney Houston.
B & W Events promoted the joint concerts in February 2010 at London's O2 Arena
by legendary performers Eric Clapton and Jeff Beck, marking the first occasion
in many years that these two giants of the music world performed together in the
UK.
Challi Productions Limited
In April 2009, Edge Performance VCT invested GBP1,000,000 in Challi Productions.
At the time, Edge Performance VCT committed to invest a further GBP1,000,000,
which was completed in October 2009.
Challi Productions Limited's founding director, Jeff Golembo has spent over 25
years in the music and entertainment business and was formerly Managing Director
of MCA Records in the UK, having held senior business and commercial roles at
CBS Records in Paris, New York and London and Phonogram Records in the UK. He is
currently on the Board of Entertainment Media Research, a leading online music
research company, and consults for a number of media clients in the UK and
Africa, where he is a partner in one of the largest independent music and
entertainment groups in South Africa.
With the benefit of an events licensing arrangement with AEG Live, Challi
Productions successfully promoted the UK national tour of American superstar
"boyband", Backstreet Boys, in November and December 2009. Challi Productions is
co-promoting appearances by DJ superstar Tiesto in the Summer of 2010.
Coolabi plc
Edge Performance VCT invested GBP250,000 in AIM-listed Coolabi plc in November
2009, with a small follow-on investment in Feburary 2010.
The business of Coolabi plc is that of acquisition and exploitation of a range
of different intellectual property portfolios, including Purple Ronnie, Scarlett
& Crimson, Dead Gorgeous and The Large Family. 2009 saw expansion and growth,
with the acquisition of rights to the Ambler, Innes and Creasey literary
estates, and the extension of distribution agreements for Bagpuss, Clangers &
Ivor the Engine.
The company's results for the period ended 31st December 2009 give the Manager
confidence that the management team are delivering on the strategy they have set
out. According to the management team, 2009 was expected to be a year of
transformation during which growth and profitability were to be achieved, and
they have succeeded on both fronts. The portfolio consists of a number of
properties at different stages of development, some of which are expected to
bear fruit in 2010, and hence the expectation is that the company will continue
to deliver growth and increasing profits in the coming year. Management have
stated that the trading in the first quarter of 2010 has been in line with their
expectations and because of the timing of projects therefore they expect the
second half of the year to be stronger than the first half.
Enrich Social Productions Limited
In December 2008, GBP500,000 was invested, through a combination of equity and
loan stock, in Enrich Social Productions Limited (ESP) for a 5% equity interest.
In October 2009, Edge Performance invested a further GBP1,000,000, bringing its
equity interest to 24%.
ESP creates and provides online and mobile competition formats and develops
supporting technical platforms for those formats.
The Manager regards the early results of the company in developing fulfilment,
excitement and engagement around the 1click2fame website as encouraging. Since
the year end the "content as a service" business stream has shown good traction
from brand owners. As the business continues to develop and expand its
operations it is expected to require further financial support from Edge
Performance VCT, its existing and new investors.
HTM Promotions Limited
HTM Promotions Limited's founding director, Paul Crockford, is an established
artist management figure in the UK music business, having also been a promoter.
In 1976, he became the youngest ever university social secretary in the history
of the NUS, bringing acts as diverse as The Damned and Elton John to Southampton
University. On leaving university, he worked briefly as a tour manager, before
joining Outlaw in 1980, promoting artists such as Genesis, The Police, Eric
Clapton, Tears For Fears and Dire Straits. At the same time, he took his first
steps in artist management, looking after a roster which included Level 42,
Judie Tzuke and Teardrop Explodes. In 1987, he established Paul Crockford
Management, under whose guidance Level 42 became one of the most popular British
acts of the 1980s, selling in excess of 20 million albums. Paul has also been
heavily involved in the Princes Trust, having promoted shows starring some of
the world's leading performers, including Paul McCartney, Mick Jagger, David
Bowie, Phil Collins and Tina Turner, raising significant sums for the Trust.
Paul is currently managing former Dire Straits frontman, Mark Knopfler.
HTM Promotions successfully co-promoted the 2009 UK national arena tour by teen
sensation Miley Cyrus.
MK Ultrasound Limited
Edge Performance VCT completed its initial investment of GBP1,000,000 in MK
Ultrasound in April 2008, and a further investment of GBP1,000,000 in February
2010. Both investments were funded from the C Share pool.
David Dorrell, a director and shareholder of MK Ultrasound, is a veteran of the
music industry with successes stretching over three decades. He started his
career as a journalist at the New Musical Express in the early 1980s where he
championed acts as diverse as The Smiths and Sade. In 1987, as a member of
chart-toppers MARRS, he was responsible the multi-million selling dance music
anthem 'Pump Up The Volume'. The 1990s brought success in the studio, when he
produced and remixed recordings for acts ranging from U2 to De La Soul, Janet
Jackson to Tina Turner. He discovered and managed Bush, who became one of the
most successful bands of the 1990s with over 10 million global sales. With Dirty
Vegas debuting in the Billboard Top Ten in 2002, Dorrell completed a hat-trick
with platinum acts across three decades in the US, and global record sales of
over twenty million. In 2004, he took on the management of Pet Shop Boys until
late 2008.
Since incorporation, MK Ultrasound has promoted or co-promoted a diverse slate
of events, including concert tours by New Kids On The Block, Pussycat Dolls,
Chris Cornell and Franz Ferdinand. In January 2010, the company co-promoted the
successful UK national tour of Total Nonstop Action (TNA) Wrestling.
Saravid Promotions Limited
Edge Performance VCT completed its initial investment from the C Share pool of
GBP1,000,000 in Saravid Promotions in October 2008, with a second investment of
GBP1,000,000 committed at that time and completed in May 2009.
Daniel Lycett, is the founding director and shareholder of Saravid Promotions.
Joining the music industry in 1989 at the tender age of 18, Lycett has worked in
a range of roles for some of the most notable companies in the industry's
independent sector. Following a stint at BBC Radio 1, Lycett moved to a
marketing and promotion position at PWL Records, home to the 'Hit Factory'
production trio Stock Aitken & Waterman, and at the time the most successful
independent record label and production company in the UK business, where he
worked with artists such as Kylie Minogue, Jason Donovan and 2 Unlimited. In
1995, he joined the newly opened London office of German independent label Edel
Records, where he became the youngest managing director of a UK record label,
achieving a string of successes with Disney/Hollywood Records soundtracks, the
Baha Men ("Who Let The Dogs Out") and German dance act Scooter. Since 2004,
Lycett has operated on a freelance basis, working with, amongst others, 1960s
superstar Donovan and US hip hop legends Wu Tang Clan.
Following the loss sustained by Saravid Promotions on the run of "Monkey -
Journey To The West" at the end of 2008, the company has since successfully
undertaken the co-promotion of the 2009 UK tour by Beyonce, and with the
forthcoming tour by Alicia Keys also anticipated to be profitable.
Saravid Promotions has the benefit of an events licensing arrangement with AEG
Live, under which live event promotion opportunities will be offered to Saravid
Promotions until June 2012. The company will therefore continue to have the
opportunity to recover its position following the loss on "Monkey - Journey To
The West". If the company is unable to recover its position, it also has the
benefit of a contractual guarantee from AEG as to the minimum return to be
earned by the company over that period.
TRP 2009 Limited
In February 2010, Edge Performance VCT invested GBP1,000,000 in TRP 2009
Limited.
Paul Burger, who is the founding director and shareholder of the company, has
more than 30 years' experience within the music industry, including as Chairman
of Sony Music Canada, Chairman of Sony Music UK, President of Sony Music Europe
and, most recently, as founder of Soho Artists, a boutique artist management
company representing both mainstream and world music artists.
Non-Qualifying Investments
Initially, the net proceeds of each of Edge Performance VCT's share offers is
invested in various fixed income securities, cash and cash equivalent assets,
offering a high degree of capital preservation. Whilst a suitable level of
return is sought, the Manager has regarded, and will continue, for as long as
appropriate, to regard capital preservation as an important consideration.
Subsequently, up to 30% of the investment funds will be maintained in such
investments whilst the balance is reinvested in VCT qualifying investments.
As at the end of the year, Edge Performance VCT held non-qualifying investments,
managed by Rothschild and UBS, with a total value of GBP23,743,735, and bank
deposits of GBP792,896.
Fundraising
In November 2008, Edge Performance VCT launched an offer of subscription for up
to 10 million E Shares. Despite adverse market conditions, and the significant
reduction in the overall VCT market for 2008/09 compared to prior years,
applications for a total of 9.8 million E Shares were received by the time the
offer closed in June 2009.
In November 2009, Edge Performance VCT launched an offer of subscription for up
to 10 million F Shares. Very significant early demand resulted in the Board
exercising its right, in February 2010, to extend the offer to 20 million F
Shares. As it became clear that demand would exceed even that higher amount,
Edge Performance VCT issued a supplementary prospectus in March 2010, increasing
the offer to up to 30 million F Shares. The F Share offer closed on 4 June 2010,
by which date applications for a total of 29.6 million F Shares had been
received, making Edge Performance VCT one of the most successful VCT offerings
in the market, and bringing the total amount raised by Edge Performance VCT
since inception to GBP78 million.
Outlook
The Manager continues to receive regular attractive approaches, including
opportunities in the wider entertainment and live event arenas (such as musical
theatre, DVD and exhibitions). Moreover, the Manager believes that, in the
present economic times, the continuing reduced levels of funding generally
available to businesses through borrowing means that terms of investment which
the Company is able to obtain have become and will remain increasingly
attractive.
The Manager continues actively to review all approaches, as well as proactively
seeking out investment opportunities through its and the Board's extensive
network of contacts in the sector.
Investment Portfolios
as at 28 February 2010
+-------------+--------+--------+-----------+------------+--------+------------+------------+--------+----------+
| | 2010 | 2009 | |
+-------------------------------+---------------------------------+----------------------------------+----------+
| C Share Portfolio | Cost | Valuation | % of | Cost | Valuation | % of | |
| | GBP | | net | GBP | GBP | net | |
| | | GBP | assets | | | assets | |
| | | | | | | | |
| | | | by | | | by | |
| | | | value | | | value | |
+ + + + + + + +----------+
| | | | | | | | |
+ + + + + + + +----------+
| | | | | | | | |
+-------------------------------+-----------+------------+--------+------------+------------+--------+----------+
| Qualifying | | | | | | | | | |
| investments | | | | | | | | | |
+-------------+--------+--------+-----------+------------+--------+------------+------------+--------+----------+
| MK | | | 2,007,658 | 1,867,799 | 18.5 | 1,007,658 | 933,000 | 8.9 | |
| Ultrasound | | | | | | | | | |
+-------------+--------+--------+-----------+------------+--------+------------+------------+--------+----------+
| Saravid | | | 2,007,050 | 1,499,226 | 14.8 | 1,007,050 | 597,000 | 5.7 | |
| Promotions | | | | | | | | | |
+-------------+--------+--------+-----------+------------+--------+------------+------------+--------+----------+
| Enrich | | | 752,012 | 750,000 | 7.4 | 700,000 | 700,000 | 6.7 | |
| Social | | | | | | | | | |
| Productions | | | | | | | | | |
+-------------+--------+--------+-----------+------------+--------+------------+------------+--------+----------+
| B & W | | | 1,004,025 | 1,000,000 | 9.9 | n/a | n/a | - | |
| Events | | | | | | | | | |
+-------------+--------+--------+-----------+------------+--------+------------+------------+--------+----------+
| Coolabi | | | 250,000 | 211,000 | 2.1 | n/a | n/a | - | |
+-------------+--------+--------+-----------+------------+--------+------------+------------+--------+----------+
| TRP 2009 | | | 1,000,000 | 1,000,000 | 9.9 | n/a | n/a | - | |
+-------------+--------+--------+-----------+------------+--------+------------+------------+--------+----------+
| Total | | | 7,020,745 | 6,328,025 | 62.6 | 2,714,708 | 2,230,000 | 21.3 | |
| qualifying | | | | | | | | | |
| investments | | | | | | | | | |
+-------------+--------+--------+-----------+------------+--------+------------+------------+--------+----------+
| Total | | | 7,020,745 | 6,328,025 | 62.6 | 2,714,708 | 2,230,000 | 21.3 | |
| fixed | | | | | | | | | |
| asset | | | | | | | | | |
| investments | | | | | | | | | |
+-------------+--------+--------+-----------+------------+--------+------------+------------+--------+----------+
| Net | | | | 3,774,609 | 37.4 | | 8,273,922 | 78.7 | |
| current | | | | | | | | | |
| assets | | | | | | | | | |
+-------------+--------+--------+-----------+------------+--------+------------+------------+--------+----------+
| Net | | | | 10,102,634 | 100.0 | | 10,503,922 | 100.0 | |
| assets | | | | | | | | | |
+-------------+--------+--------+-----------+------------+--------+------------+------------+--------+----------+
| | |
+----------------------------------------------------------------------------------------------------+----------+
| | 2010 | 2009 | |
+-------------------------------+---------------------------------+----------------------------------+----------+
| D Share Portfolio | Cost | Valuation | % of | Cost | Valuation | % of | |
| | GBP | | net | GBP | | net | |
| | | GBP | assets | | GBP | assets | |
| | | | | | | | |
| | | | by | | | by | |
| | | | value | | | value | |
+-------------------------------+-----------+------------+--------+------------+------------+--------+----------+
| Qualifying | | | | | | | | | |
| investments | | | | | | | | | |
+-------------+--------+--------+-----------+------------+--------+------------+------------+--------+----------+
| Enrich | | | 752,013 | 750,000 | 4.5 | - | - | - | |
| Social | | | | | | | | | |
| Productions | | | | | | | | | |
+-------------+--------+--------+-----------+------------+--------+------------+------------+--------+----------+
| Challi | | | 2,000,000 | 2,000,000 | 12.05 | - | - | - | |
| Productions | | | | | | | | | |
+-------------+--------+--------+-----------+------------+--------+------------+------------+--------+----------+
| HTM | | | 2,000,000 | 2,000,000 | 12.05 | | | | |
| Promotions | | | | | | | | | |
+-------------+--------+--------+-----------+------------+--------+------------+------------+--------+----------+
| Total | | | 4,752,013 | 4,750,000 | 28.6 | - | - | - | |
| qualifying | | | | | | | | | |
| investments | | | | | | | | | |
+-------------+--------+--------+-----------+------------+--------+------------+------------+--------+----------+
| Total | | | 4,752,013 | 4,750,000 | 28.6 | - | - | - | |
| fixed | | | | | | | | | |
| asset | | | | | | | | | |
| investments | | | | | | | | | |
+-------------+--------+--------+-----------+------------+--------+------------+------------+--------+----------+
| Net | | | | 11,854,167 | 71.4 | 18,164,900 | 100.0 | 100.0 | |
| current | | | | | | | | | |
| assets | | | | | | | | | |
+-------------+--------+--------+-----------+------------+--------+------------+------------+--------+----------+
| Net | | | | 16,604,167 | 100.0 | 18,164,900 | 100.0 | 100.0 | |
| assets | | | | | | | | | |
+-------------+--------+--------+-----------+------------+--------+------------+------------+--------+----------+
| | |
+----------------------------------------------------------------------------------------------------+----------+
| | 2010 | | | | |
+-------------------------------+---------------------------------+------------+------------+--------+----------+
| E Share Portfolio | Cost | Valuation | % of | | | | |
| | GBP | | net | | | | |
| | | GBP | assets | | | | |
| | | | | | | | |
| | | | by | | | | |
| | | | value | | | | |
+ + + + +------------+------------+--------+----------+
| | | | | | | | |
+ + + + +------------+------------+--------+----------+
| | | | | | | | |
+-------------------------------+-----------+------------+--------+------------+------------+--------+----------+
| Total | | | - | - | - | | | | |
| qualifying | | | | | | | | | |
| investments | | | | | | | | | |
+-------------+--------+--------+-----------+------------+--------+------------+------------+--------+----------+
| Total | | | - | - | - | | | | |
| fixed | | | | | | | | | |
| asset | | | | | | | | | |
| investments | | | | | | | | | |
+-------------+--------+--------+-----------+------------+--------+------------+------------+--------+----------+
| Net | | | | 8,992,719 | 100.0 | | | | |
| current | | | | | | | | | |
| assets | | | | | | | | | |
+-------------+--------+--------+-----------+------------+--------+------------+------------+--------+----------+
| Net | | | | 8,992,719 | 100.0 | | | | |
| assets | | | | | | | | | |
+-------------+--------+--------+-----------+------------+--------+------------+------------+--------+----------+
Venture Capital Investments
as at 28 February 2010
B & W Events Limited
*Cost:
GBP1,000,000
Valuation: GBP1,000,000
Basis of valuation: Cost
Equity holding: 49%
*Excludes acquisition costs of GBP4,025.
As the company was only incorporated on 22 July 2009, no accounts have yet been
filed, and its first audited accounts will be for the period from incorporation
to 31 July 2010. Unaudited management accounts for the period from incorporation
to 28 February 2010 show a gross profit of GBP154,960 on turnover of
GBP2,181,051, and a profit on ordinary activities, before interest and taxation,
of GBP134,104.
Challi Productions Limited
Cost:
GBP2,000,000
Valuation: GBP2,000,000
Basis of valuation: Cost
Equity holding: 49.5%
As the company was only incorporated on 18 March 2009, no accounts have yet been
filed, and its first audited accounts will be for the period from incorporation
to 31 March 2010. Unaudited management accounts for the period from
incorporation to 28 February 2010 show a gross profit of GBP19,070 on turnover
of GBP638,139, and a loss on ordinary activities, before interest and taxation,
of GBP82,630.
MK Ultrasound Limited
*Cost:
GBP2,000,000
Valuation: GBP1,867,799
Basis of valuation: Net asset value
Equity holding: 50%
*Excludes acquisition costs of GBP7,658.
MK Ultrasound's first audited accounts were for the period from incorporation
(20 March 2008) to 31 August 2009, showing gross profit of GBP2,563 on turnover
of GBP901,254, and a loss on ordinary activities, before provision for payments
to Edge Performance VCT, of GBP57,053. Unaudited management accounts for the
period from 1 September 2009 to 28 February 2010 show a gross profit of
GBP4,284, and a loss on ordinary activities, again before interest and taxation,
of GBP17,199.
Enrich Social Productions Limited
*Cost:
GBP1,500,000
Valuation: GBP1,500,000
Basis of valuation: Cost
Equity holding: 24%
*Excludes acquisition costs of GBP4,025
Enrich Social Productions (ESP), founded in September 2007, creates and provides
online and mobile competition formats and develops supporting technical
platforms for those formats.
ESP's first offering, 1click2fame (www.1click2fame.com), is an online talent
contest which was launched in January 2009. During the period since launch the
business decided to concentrate on viral marketing rather than through paid for
acquisition of unique visitors (uvs) with the view to higher levels of retention
and brand loyalty. Around the turn of the year this started to pay off as ESP
has increased and retained uvs, at approximately, 450,000 per month, 35,000
members and six breaking artists from this growing talent pool.
This initial success has enabled a second generation of the platform to be
developed providing more flexibility and higher quality metrics enabling ESP to
market its technology platform on a "Content as a Service" basis to brand
owners. Whereby, ESP manages a brand owner's content and develops a distribution
channel for the brand owner linked to a customer competition environment. ESP
since the year end has agreed terms in principle regarding the use of its
platform for several third party formats.
This second generation technology will enable the business to be more cost
effective as it strives in the coming period to become cash positive and
profitable.
Unaudited management accounts for the period to 31 December 2009 show a gross
profit of GBP215,000 on turnover of GBP415,000, and a loss on ordinary
activities of GBP3,282,000.
Coolabi plc
Cost: GBP250,000
Valuation: GBP211,000
Basis of valuation: Bid price on AIM
Equity holding: 0.64%
On 15 April 2010, Coolabi plc published its annual report and accounts for the
18 months ended 31 December 2009, showing gross profit of GBP2,037,452 (2008:
GBP925,535) and EBITDA of GBP202,456 (2008: loss of GBP249,924).
HTM Promotions Limited
Cost:
GBP2,000,000
Valuation: GBP2,000,000
Basis of valuation: Cost
Equity holding: 49.5%
As the company was only incorporated on 1 April 2009, no accounts have yet been
filed, and its first audited accounts will be for the period from incorporation
to 30 April 2010. Unaudited management accounts for the period from
incorporation to 28 February 2010 show a gross profit of GBP12,503 on turnover
of GBP1,090,011, and a loss on ordinary activities, before interest and
taxation, of GBP89,173.
Saravid Promotions Limited
*Cost:
GBP2,000,000
Valuation: GBP1,499,226
Basis of valuation: Net asset value
Equity holding: 49.5%
*Excludes acquisition costs of GBP7,050.
Saravid Promotions's first audited accounts were for the period from
incorporation (3 September 2008) to 28 February 2010, and showed a gross loss of
GBP281,121 on turnover of GBP1,952,158, and a loss on ordinary activities,
before interest and taxation, of GBP442,805.
TRP 2009 Limited
Cost:
GBP1,000,000
Valuation: GBP1,000,000
Basis of valuation: Cost
Equity holding: 50%
TRP 2009 was incorporated on 17 December 2008, but did not commence trading
until February 2010, when Edge Performance VCT made its initial investment in
the company. Management accounts for the period ended 28 February 2010 are
therefore not available.
TRP 2009's year end is 31 December, and its first audited accounts since
commencement of trading will therefore be for the 12 months ending 31 December
2010.
Directors' Report
The Directors present the financial statements of the Company (incorporated in
England and Wales with registration number 5558025) for the year ended 28
February 2010 and their report on its affairs.
Business and Principal Activities
Edge Performance VCT plc ("Edge" or the "Company") has pioneered an approach
which was designed to address the key issues which we believe have in the past
deterred some individuals from investing in VCTs, namely the ability to exit
from the VCT once the investment has been held for five years, and the perceived
level of risk of the underlying investments. Edge Performance seeks to allow
investors to take advantage of VCT tax reliefs whilst combining:
- high targeted returns;
- downside risk protection; and
- liquidity.
Using the skills of the Directors and the investment team of the Manager who
collectively have a depth of experience in the entertainment industry, Edge
Performance was established for the purpose of investing in the entertainment
industry, initially concentrating on companies which promote live music,
theatre, sports, festivals, trade shows, exhibitions and other events where
people attend in person, and subsequently seeking to invest in the broader
entertainment sector and utilising arrangements that seek to combine high
targeted returns with reduced downside risk and enhanced liquidity whilst
allowing investors to take advantage of VCT tax reliefs.
Edge's structure aims to minimise the risk to the investor, whilst still
permitting the investor to benefit from attractive returns by utilising
arrangements that seek to combine high targeted returns with reduced downside
risk and enhanced liquidity. The majority of the portfolio investments will be
made through loan finance which should provide additional capital protection.
Further detail of the Company's investment policy is given on page 2.
Edge has reached agreement with SJM Limited, a leading UK concert promoter, and
with AEG Live (UK) Limited, a UK subsidiary of leading music promotion firm, AEG
Live, for the promotion of events with the Events Companies.
The Directors do not foresee any major changes in the activity undertaken by the
Company in the foreseeable future.
VCT Status
The Company was granted provisional approval in April 2006 as a venture capital
trust by HM Revenue & Customs under section 274 of the Income Tax Act 2007. The
Directors intend to continue to manage the affairs of the Company in compliance
with this section.
Business Review
This Business review has been prepared in accordance with the requirements of
Section 417 of the Companies Act 2006 and best practice. A detailed review of
the Company's development and performance during the year and consideration of
its future prospects may be obtained by reference to this Report, the Chairman's
Statement (page 3) and the Investment Manager's Review (pages 7 to 10). Details
of the venture capital investments made by the Company are given in the
Investment Portfolios (page 11) and the Venture Capital Investments report (page
12). A summary of the Company's key financial measures is given on page 1.
Details of important events occurring after the balance sheet date can be found
in note 19 to the financial statements on page 41.
The Company's board of directors ("Board") is responsible to shareholders for
the proper management of the Company and for determining the Company's
investment policy. Investment and divestment opportunities are originated,
negotiated and decided on by the Investment Manager, Edge Investment Management
Limited. Company secretarial and accountancy services are provided to the
Company by The City Partnership (UK) Limited.
In reviewing the work of the Manager, the Board looks to be satisfied that:
> The Company's investment policy is being followed
> Each investment or divestment decision is subjected to rigorous due
diligence
> Risk is further mitigated by investing across a sufficiently diverse
range of businesses and by maintaining a balance between equity and loan stock
exposure
> The portfolio will meet the HMRC VCT conditions
In consideration of the Company's financial performance, the Board, taking
account of the comparatively long term nature of the Company's investments, pays
particular attention to net asset value total return per share, total expense
ratio and performance against the FT All Share Media Index (which is considered
to be the most appropriate broad equity market index for comparative purposes).
Net Asset Value Total Return per Share
The net asset value total return per share comprises the net asset value per
share plus cumulative dividends paid per share. Net asset value is calculated at
least quarterly with investments valued in accordance with the International
Private Equity and Venture Capital Valuation Guidelines. During the year under
review, the Company's net asset value total returns per share changed as
undernoted:
+--------+--------+----------+
| | 1 | 28 |
| | March | February |
+--------+--------+----------+
| | 2009 | 2010 |
+--------+--------+----------+
| | Pence | Pence |
+--------+--------+----------+
| | | |
+--------+--------+----------+
| Net | 92.81 | 89.80 |
| asset | | |
| value | | |
| total | | |
| return | | |
| per C | | |
| share | | |
+--------+--------+----------+
| Net | 94.47 | 92.45 |
| asset | | |
| value | | |
| total | | |
| return | | |
| per D | | |
| share | | |
+--------+--------+----------+
| Net | - | 91.68 |
| asset | | |
| value | | |
| total | | |
| return | | |
| per E | | |
| share | | |
+--------+--------+----------+
Over the same period, the FT All Share Media Index rose by 42.3%. Graphs
comparing, for each of the Company's share classes, the share price total
return, the net asset value total return per share and the total return from a
notional investment of 100p in the FT All Share Media Index over the period from
5 April 2006 to 28 February 2010 are presented on page 20.
Results and Dividends
As shown in the Company's Income Statement on page 27 of the financial
statements, the Company's returns per share in the year ended 28 February 2010
were:
+---------+-----------+--------+--------+--------+
| | *Ordinary | C | D | E |
| | | | | |
+---------+-----------+--------+--------+--------+
| | share | share | share | share |
| | fund | fund | fund | fund |
+---------+-----------+--------+--------+--------+
| Revenue | (0.90) | (0.65) | (1.23) | (1.24) |
| return | | | | |
| per | | | | |
| share, | | | | |
| pence | | | | |
+---------+-----------+--------+--------+--------+
| Capital | (3.08) | (2.36) | (0.79) | (0.62) |
| return | | | | |
| per | | | | |
| share, | | | | |
| pence | | | | |
+---------+-----------+--------+--------+--------+
| Total | (3.98) | (3.01) | (2.02) | (1.86) |
| return | | | | |
| per | | | | |
| share, | | | | |
| pence | | | | |
+---------+-----------+--------+--------+--------+
*For the period from 1 March 2009 to 21 December 2009 when the ordinary shares
were converted into deferred shares and cancelled.
Interim dividends as undernoted were paid during the year ended 28 February
2010:
0.2p per ordinary share
The Board recommends the payment of the undernoted final dividends in respect of
the year ended 28 February 2010:
7.0p per C share
7.0p per D share
7.0p per E share
The Balance Sheet on page 29 of the financial statements shows that the
Company's net assets have increased over the year, reflecting the injection of
capital through the E share offer for subscription and the return of capital to
the holders of ordinary shares. The net asset value per C share has decreased
principally because of the significant reduction in investment income and net
decrease in the carrying value of the fund's investments. The net asset value
per D share has decreased, principally because of the payment of a 7.0p per
share dividend and the significant reduction in investment income.
Cash held in the Company's bank accounts has decreased over the period as the
Manager looks to maximise the Company's investment income by transferring as
much as possible of the Company's cash into a spread of liquidity funds pending
its investment in VCT qualifying holdings.
Total Expense Ratio
The total expense ratio, calculated as the year's expenses (as disclosed in the
profit & loss account) divided by the average net asset value across the year,
was 3.69%.
The total expense ratio for the Company for the period from 1 March 2008 to 29
February 2009 was 3.26%.
Under the terms of the investment management agreement, the running costs of the
Company (excluding the investment manager's performance related incentive fee,
trail commission, irrecoverable VAT and costs of any significant corporate
activity) are restricted to a maximum of 3.0% of the net asset value of the
Company. Any excess will be paid by the investment manager. No excess was
payable in respect of the year ended 28 February 2010.
Future Developments
The Company's priorities over the next three years are (i) satisfying, in
respect of its D, E and F share investment portfolios, the HMRC VCT criterion of
having at least 70% by value of its investments in shares or securities
comprised in VCT qualifying holdings and (ii) closely monitoring the performance
of the investment portfolios with the aim of maximising their performance.
Risk Management
The Board has adopted a risk management programme whereby it continually
identifies the principal risks faced by the Company and reviews both the nature
and effectiveness of the internal controls adopted to protect the Company from
such risks as far as is possible.
The Board believes that the principal risks to which the Company is exposed are:
> Economic risk - events such as a downturn in the media sector or a
tightening of credit facilities may adversely affect the Company's investee
companies and make successful divestments less likely
> Investment risk - the adoption of inappropriate investment policies,
sourcing too few investment opportunities of the required standard, and taking
investment decisions without having undertaken sufficiently robust due diligence
> Financial risk - poor financial controls which may lead to the
misappropriation of assets or inappropriate financial decisions and breaches of
regulations through deficient financial reporting
> Regulatory - failure to comply with any of the regulations to which
the Company is subject which include the provisions of the Companies Act 1985,
the provisions of the Companies Act 2006, the UKLA listing rules, applicable
Accounting Standards and HMRC VCT regulations
Further information about the Company's internal controls is given in the
Statement of Corporate Governance on pages 21 to 23.
Corporate Information
Directors
The Directors who have served throughout the year under review and who continue
to serve are Sir Robin Miller, Michael Eaton, David Glick, Julian Paul and Frank
Presland.
Sir Robin Miller retired and was reappointed at the Company's third annual
general meeting which was held on 29 June 2009. Julian Paul and Frank Presland
will retire by rotation at the annual general meeting to be held on 11 August
2010 - both are standing for re-appointment.
Brief biographical details of the current directors are given on pages 5 and 6.
Directors' Interests
The interests of the current Directors and their connected persons in the C
shares, D shares, E shares and F shares of the Company as at the date of this
report are shown below.
+----------+----------+------------+----------+------------+----------+------------+----------+------------+
| | No of | Percentage | No of | Percentage | No of | Percentage | No of | Percentage |
| | C | holding | D | | E | holding | F | holding |
| | ordinary | % | ordinary | holding | ordinary | % | ordinary | % |
| | | | shares | % | shares | | shares | |
| | shares | | as at | | as at | | as at | |
| | as at | | 28 Feb | | 28 Feb | | 29 June | |
| | 28 Feb | | and | | and | | 2010 | |
| | and | | 29 June | | 29 June | | | |
| | 29 June | | 2010 | | 2010 | | | |
| | 2010 | | | | | | | |
+----------+----------+------------+----------+------------+----------+------------+----------+------------+
| Sir | - | - | 53,000 | 0.28 | - | - | - | - |
| Robin | | | | | | | | |
| Miller | | | | | | | | |
+----------+----------+------------+----------+------------+----------+------------+----------+------------+
| Michael | - | - | - | - | - | - | - | - |
| Eaton | | | | | | | | |
+----------+----------+------------+----------+------------+----------+------------+----------+------------+
| David | 101,500 | 0.76 | 21,200 | 0.11 | - | - | - | - |
| Glick | | | | | | | | |
+----------+----------+------------+----------+------------+----------+------------+----------+------------+
| Julian | 10,000 | 0.08 | 10,300 | 0.05 | - | - | - | - |
| Paul | | | | | | | | |
+----------+----------+------------+----------+------------+----------+------------+----------+------------+
| Frank | 10,300 | 0.08 | 10,600 | 0.06 | 10,500 | 0.11 | - | - |
| Presland | | | | | | | | |
+----------+----------+------------+----------+------------+----------+------------+----------+------------+
No options over shares in the capital of the Company have been granted to the
Directors.
Directors' Remuneration Report
An ordinary resolution to approve the Directors' Remuneration Report (presented
on pages 19 and 20 will be put to the forthcoming annual general meeting.
Companies Act 2006 Disclosures
The Board recognises the requirement under Section 417(5) of the Act to detail
information about environmental matters (including the impact of the Company's
business on the environment), any Company employees and social and community
issue; including information about any policies it has in relation to these
matters and effectiveness of these policies. As the Company has no employees or
policies in these matters this requirement does not apply.
Investment Management Agreement
On 12 November 2009 the existing investment management agreement was replaced
with a new agreement continuing for an initial period ending five years from
admission of the F shares and which may be terminated thereafter by either party
on 12 months' notice, such notice to be served at the end of the initial period
or at any time thereafter.
The Manager will receive: (a) an annual management fee of 1.75% of the net asset
value attributable to the C shares, D shares, E shares and F shares, in each
case plus VAT (if applicable) and (b) a performance fee which is outlined in
more detail below.
The Manager will be responsible for external costs, such as legal and accounting
fees, incurred on all transactions that do not proceed to completion. The
Manager retains the right to charge arrangement, monitoring, syndication, exit
and directors' fees to the Events Companies and other businesses in which the
Company invests. Such charges are in line with industry practice and typically
amount to between 1% and 3% of the amount of each investment plus VAT (if
applicable). The Manager will normally nominate one of its directors to act as a
director of each Events Company.
On 12 November 2009, the Company entered into an agreement with the Manager,
under which the Manager has agreed to provide administrative services to the
Company. Under this agreement, the Manager will receive a fixed fee of
GBP125,000 per annum (plus VAT, if applicable), such fee to be adjusted annually
by reference to the movement in the Retail Prices Index. This agreement is for
an initial period ending 5 years from admission and may be terminated thereafter
by either party on 12 months' notice, such notice to be served at the end of the
initial period or at any time thereafter.
Annual running costs of the Company will include, inter alia, the management and
administration fees described above (excluding the performance fee), Directors'
remuneration, company secretarial and accounting fees, administration fees,
audit, taxation advice, sponsor's and registrar's fees and the costs of
communicating with the Company's shareholders.
Total annual operating expenses of the Company (excluding EIM's performance
incentive fee, irrecoverable VAT and costs
of any significant corporate activity) have been capped at 3.0% of the net asset
value of the Company with any excess being borne by EIM.
Performance Related Incentive Fee
In respect of the C Shares, D Shares, E Shares and F Shares, the Manager will
receive a fee equal to 19% of the cumulative cash (prior to calculation of the
performance fee) returned to C Shareholders, D Shareholders, E Shareholders and
F Shareholders by the Company of between 100p and 120p per C Share, D Share, E
Share and F Share respectively and a fee equal to 29% of the cumulative cash
(prior to calculation of the performance fee) returned to C Shareholders, D
Shareholders, E Shareholders and F Shareholders by the Company in excess of 120p
per C Share, D Share, E Share and F Share respectively. This fee is to be paid
in cash and can be assigned by the Manager to some or all of the investment
team.
Share Capital
On 5 April and 15 June 2009 a total of 9,813,732 E shares were allotted and
issued for cash to various subscribers who submitted valid applications under
the offers for subscription made through a prospectus dated November 2008.
At a general meeting of the Company held on 16 December 2009, it was resolved
that: (a) the authorised share capital of the Company be increased to
GBP55,500,000 by the creation of 50,000,000 F shares and 25,000,000 Deferred
Shares of 10p each having the rights and being subject to the restrictions set
out in the new Articles of Association; and (b) the new Articles of Association
be adopted. At a general meeting of the Company held on 15 March 2010, it was
resolved that (a) the authorised share capital of the Company be increased to
GBP57,500,000 by the creation of 10,000,000 F shares and 10,000,000 Deferred
Shares of 10p each having the rights and being subject to the restrictions set
out in the new Articles of Association; and (b) the new Articles of Association
be adopted.
As at 28 February 2010, 13,328,599 C shares of 10p each, 19,228,838 D shares of
10p each and 9,813,732 E shares of 10 p each of the Company were in issue. As at
the date of this report, a further 29,611,437 F shares of 10p each were in issue
having been allotted and issued under the offer for subscription of up to
20,000,000 F shares (subsequently extended to 30,000,000 F shares) made through
a prospectus dated November 2009.
The Company operates a policy of buying back shares for cancellation.
Substantial Shareholdings
As at the date of this report the Company was not aware of any individual
shareholdings exceeding 3% of the issued share capital.
Authority to make Market Purchases of Shares
By a special resolution of the Company passed at a general meeting of the
Company held on 16 December 2009, the Company was generally and unconditionally
authorised (in accordance with section 551 of the Companies Act) to make market
purchases of up to 14.99% of the issued C share capital, 14.99% of the issued D
share capital, 14.99% of the issued E share capital and 14.99% of the issued F
share capital as at the date of the final closing of the F share offer. The
price paid must not be less than 10p per share nor more than 5 per cent above
the average of the middle market quotations for a share as derived from the
Official List of the London Stock Exchange for the five business days
immediately preceding the date on which the shares are purchased.
The authority expires at the conclusion of the 2010 annual general meeting but
renewal of the authority will be sought at that meeting.
Cancellation of Share Premium Account
At an extraordinary general meeting of the Company held on 14 January 2009, it
was resolved that, subject to the approval of the High Court of Justice, the
share premium account of the Company in respect of the E shares be cancelled.
Such High Court approval was granted and the share premium account was
cancelled.
The cancellation of the share premium account will create a special reserve that
can be used, amongst other things, to fund buy-backs of the Company's shares
when the Board considers that it is in the best interests of the Company to do
so.
Disclosure of Information to Auditors
The Directors who held office at the date of the approval of this Directors'
Report confirm that, so far as they are aware: there is no relevant audit
information of which the Company's auditors are unaware and the Directors have
taken all the steps they ought to have taken to make themselves aware of any
relevant audit information and to establish that the auditors are aware of that
information.
Auditors
A resolution to re-appoint Scott-Moncrieff as auditors to the Company will be
proposed at the forthcoming annual general meeting. A separate resolution will
be proposed at the meeting authorising the Directors to fix the remuneration of
the auditors.
Creditor Payment Policy
The Company's policy is to pay all suppliers' invoices in accordance with agreed
terms. There was one trade creditor as at 28 February 2010.
2010 Annual General Meeting and Class Meetings
The Company's fourth annual general meeting will be held at noon on 11 August
2010 at the offices of Howard Kennedy, 19 Cavendish Square, London. Notice of
the meeting is set out on pages 44 and 45 of this report.
Class meetings of holders of C shares, D shares, E shares and F shares will also
be held on 11 August 2010. Notices of the class meetings are set out on pages 46
to 53 of this report.
By Order of the Board,
The City Partnership (UK) Limited
Company Secretary
30 June 2010
Directors' Remuneration Report
This report has been prepared by the Directors in accordance with the
requirements of the Companies Act 2006 and The Large and Medium sized Company
and Groups (Accounts and Reports) Regulations 2008. A resolution to approve the
report will be proposed at the forthcoming annual general meeting.
The Company's auditors, Scott-Moncrieff, are required to give their opinion on
certain information included in this report. The disclosures which have been
audited are indicated as such. Their report is set out on page 25.
Remuneration Committee
During the year under review, the members of the Company's remuneration
committee, a fully constituted board committee, were Sir Robin Miller, Michael
Eaton and Julian Paul. The committee's remit regarding remuneration is
summarised in the Statement of Corporate Governance which is set out on pages 21
to 23.
The committee did not meet in the year ended 28 February 2010. Such a meeting
was thought unnecessary given that no Director retired and the Directors'
initial fees had been agreed in their letters of appointment.
The committee has not received any advice or services from any person in respect
of the Directors' remuneration during the period.
Directors' Remuneration Policy
The remuneration committee considers that directors' fees should reflect the
time commitment required and the high level of responsibility borne by
directors, and should be broadly comparable to the fees paid by similar
companies. The Company's Articles of Association do not place an overall limit
on the Directors' remuneration. None of the Directors is eligible for pension
benefits, share options, bonuses or other benefits in respect of their services
as non-executive directors of the Company.
The Company operates a performance related incentive scheme from which two
Directors may benefit.
In respect of the O share fund, EIM is entitled to a performance related
incentive fee equal to 19% of the cumulative cash returned to ordinary
shareholders in excess of 75p per share per 60p invested (net of income tax)
although no such fee will be payable unless the cumulative cash returned to the
ordinary shareholders exceeds the initial investment of 60p per share (net of
income tax) increased by 8% per annum (simple). This fee is to be paid in cash
and can be assigned by EIM to some or all of EIM's investment team. During the
year ended 28 February 2010, a performance fee of GBP148,975 was paid to EIM.
In respect of the C share, D share and E share funds the Manager will receive a
fee equal to 19% of the cumulative dividends (prior to calculation of the
performance fee) distributed to C, D and E shareholders respectively in excess
of 100p per C, D and E share respectively, and a fee equal to 29% of the
cumulative dividends (prior to calculation of the performance fee) distributed
to C, D and E shareholders respectively in excess of 120p per C, D and E share
respectively for 70p invested (the effective cost to the investor if 30% income
tax relief is obtained on the sum subscribed). This fee is to be paid in cash
and can be assigned by the Manager to some or all of the Manager's investment
team. David Glick will benefit through his shareholding in EIM.
Under his letter of appointment, Sir Robin Miller is entitled, in respect of the
O share fund, to receive 1% of cumulative cash returned to investors by the
Company's ordinary shares in excess of 75p per share per 60p invested (net of
income tax) although no such fee will be payable unless the cumulative cash
returned to the ordinary shareholders exceeds the initial investment of 60p per
share (net of income tax) increased by 8% per annum (simple). In respect of the
C, D and E share funds, Sir Robin Miller is entitled to receive a performance
fee of 1% (calculated on the same basis as EIM's performance fee). During the
year ended 28 February 2010, a performance fee of GBP7,841 was paid to Sir Robin
Miller in respect of the O share fund.
Directors' Fees
The fees payable to individual Directors in respect of the period ended 28
February 2010 are shown in the table below. Sir Robin Miller's, Julian Paul's,
Michael Eaton's and David Glick's fees were paid to RMC Limited, Julian Paul &
Co, MusicLore Limited and Edge Media Services Limited respectively in
consideration for their services.
+----------+----------+--------+----------+--------+
| Director | Fee | Annual | Fee | Annual |
| | for | fee | for | fee |
| | ended | GBP | year | GBP |
| | 28 | | ended | |
| | February | | 28 | |
| | 2010 | | February | |
| | GBP | | 2009 | |
| | | | GBP | |
+----------+----------+--------+----------+--------+
| Sir | 15,000 | 15,000 | 19,500 | 15,000 |
| Robin | | | | |
| Miller | | | | |
+----------+----------+--------+----------+--------+
| Michael | 12,500 | 12,500 | 15,750 | 12,500 |
| Eaton | | | | |
+----------+----------+--------+----------+--------+
| Julian | 16,250 | 12,500 | 16,250 | 12,500 |
| Paul* | | | | |
+----------+----------+--------+----------+--------+
| Frank | 12,500 | 12,500 | 15,750 | 12,500 |
| Presland | | | | |
+----------+----------+--------+----------+--------+
| David | 12,500 | 12,500 | 15,750 | 12,500 |
| Glick | | | | |
+----------+----------+--------+----------+--------+
The amount paid and payable to Julian Paul comprises a consultancy fee of
GBP3,750 and a director's fee of GBP12,500. The comparative sum in 2009
comprised only a director's fee.
Terms of Appointment
The Articles of Association provide that the Directors shall retire and be
subject to re-election at least every three years. None of the Directors has a
service contract with the Company. On being appointed or re-elected, Directors
receive a letter from the Company setting out the terms of their appointment and
their specific duties and responsibilities. A Director's appointment may be
terminated by the Director or by the Company on the expiry of six months' notice
in writing given by the Director or the Company as the case may be.
Company Performance
The graphs below compare the share price total returns for the C, D and E shares
and the net asset value total returns per share for the C, D and E shares with
the total returns from a notional investment of 100p in the FT All Share Media
Index over the same periods. This index is considered to be the most appropriate
broad equity market index for comparative purposes.
The share price total return and net asset value total return per share comprise
the share price and net asset value per share respectively together with the
cumulative dividends paid.
http://www.rns-pdf.londonstockexchange.com/rns/5842O_-2010-6-30.pdf
By Order of the Board,
The City Partnership (UK) Limited
Company Secretary
30 June 2010
Statement of Corporate Governance
Statement of Compliance
The Directors confirm that the Company has taken appropriate action to enable it
to comply with the Principles of the Combined Code on Corporate Governance
(2006) ("the Code").
As a venture capital trust, most of the Company's day-to-day responsibilities
are delegated to third parties and the Directors are all non-executive. Thus,
not all the provisions of the Code are directly applicable to the Company. Apart
from the matters referred to in the following paragraphs, the requirements of
the Code were complied with throughout the period ended 28 February 2010.
In view of its non-executive nature and the requirements of the Company's
Articles of Association that all Directors retire by rotation at the annual
general meeting, the Board considers that the Directors need not be appointed
for a specific term as recommended by the Code. That said, Sir Robin Miller and
David Glick have each been appointed for a three year term with a six months'
notice period whereas the other Directors have been appointed for a rolling term
with a six months' notice period. Full details of duties and obligations are
provided at the time of appointment and are supplemented by further details as
necessary. In light of the responsibilities retained by the Board and its
committees and of the responsibilities delegated to Edge Investment Management
Limited and the company secretary, the Company has not appointed a chief
executive, deputy chairman or a senior independent non-executive director. There
is no formal induction programme for Directors.
Board of Directors
The Company has a board of five non-executive directors, four of whom are
considered to be independent. The remaining Director, David Glick, is also a
director of the Investment Manager, Edge Investment Management Limited. The
Company has no staff.
All non-executive Directors have signed letters confirming the terms of their
appointment as non-executive Directors with effect from 18 January 2006.
At each annual general meeting of the Company, at least one-third of the
Directors shall retire from office by rotation. A retiring Director is eligible
for re-election.
Directors are provided with key information on the Company's activities
including regulatory and statutory requirements and internal controls by the
Company's solicitors, the Company's VCT status adviser, the company secretary
and the Manager. The Board has direct access to corporate governance advice and
compliance services through the company secretary, who is responsible for
ensuring that board procedures are followed and compliance requirements are met.
All Directors may take independent professional advice in furtherance of their
duties as necessary. Any newly appointed Director will be given a comprehensive
introduction to the Company's business including meeting the Company's advisers.
The Board is responsible to shareholders for the proper management of the
Company and aims to meet at least quarterly. It has formally adopted a schedule
of matters which must be brought to it for decision, thus ensuring that it
maintains full and effective control over appropriate strategic, financial,
operational and compliance issues. The chairman together with the company
secretary establishes the agenda for each board meeting and all necessary papers
are distributed in advance of the meetings. The Board considers all matters not
included within the remits of the board committees.
Board Committees
There are three board committees: an audit committee, a remuneration committee
and a nomination committee. Copies of their terms of reference are available
from the company secretary.
Audit Committee
This is a fully constituted board committee which has the following key duties:
to review the half-year and annual financial statements; to review the Company's
internal control and risk management systems; and to recommend the appointment
and remuneration of external auditors.
The committee shall comprise at least two independent Directors. The members of
the committee are Michael Eaton and Julian Paul.
A quorum shall be two members.
Remuneration Committee
This is a fully constituted board committee established primarily to determine
each Director's remuneration.
The committee shall comprise at least two independent Directors. The members of
the committee are Michael Eaton, Julian Paul and Sir Robin Miller.
A quorum shall be two members.
Nomination Committee
This is a fully constituted board committee established primarily to identify
and nominate, for the approval of the Board, candidates to fill board vacancies
as and when they arise and to monitor and review the effectiveness and
performance of individual Directors.
The committee shall comprise at least two members, no less than one of whom
shall be an independent Director. The members of the committee are Michael
Eaton, Julian Paul and Sir Robin Miller.
A quorum shall be two members.
Attendance at Board and Committee Meetings
During the year ended 28 February 2010 there were:
> 7 board meetings convened to consider general business (and several
other board meetings convened to consider business specific to the offers for
subscription made by the Company during the period under review)
> 2 meetings of the audit committee
> No meetings of the remuneration committee
> No meetings of the nomination committee
The Directors' attendance at the board meetings convened to consider general
business is noted below.
+----------+--------+--------+
| Director | Board | Audit |
| | | Cttee |
+----------+--------+--------+
| Robin | 7 | n/a |
| Miller | | |
+----------+--------+--------+
| Michael | 6 | 2 |
| Eaton | | |
+----------+--------+--------+
| David | 5 | n/a |
| Glick | | |
+----------+--------+--------+
| Frank | 4 | n/a |
| Presland | | |
+----------+--------+--------+
| Julian | 7 | 2 |
| Paul | | |
+----------+--------+--------+
Internal Control
The Board has established an ongoing process for the identification, evaluation
and management of the significant risks faced by the Company. The Board
acknowledges that it is responsible for the Company's internal control systems
and for reviewing their effectiveness. Internal controls are designed to manage
the particular needs of the Company and the risks to which it is exposed. The
internal control systems aim to ensure the maintenance of proper accounting
records, the reliability of the financial information on which business
decisions are made and which is used for publication, and that the assets of the
Company are safeguarded. They can by their nature provide only reasonable and
not absolute assurance against material misstatement or loss. The financial
controls operated by the Board include regular reviews of both the financial
results and investment performance.
The Board has delegated to third parties the provision of: investment management
services; legal and VCT status advisory services; day-to-day accounting, company
secretarial and administration services; and share registration services.
Each of these contracts was entered into after full and proper consideration by
the Board of the quality and cost of services offered. The Board receives and
considers regular reports from the investment manager. Ad hoc reports and
information are supplied to the Board as required. The Board keeps under review
the terms of the agreement with the investment manager.
Review of Internal Control
The process adopted by the Board for identifying, evaluating and managing the
risks faced by the Company includes an annual review of the control systems. The
review covers a consideration of the significant risks in each of five areas:
statutory and regulatory compliance, financial reporting, investment strategy,
investment performance and reputation.
Each risk is considered with regard to; the likelihood of occurrence, the
probable impact on the Company and the controls exercised at source, through
reporting and at Board level.
The Board is satisfied with the effectiveness of the Company's controls.
Relations with Shareholders
The Board welcomes the views of shareholders and puts a premium on effective
communication with the Company's members.
All written communication with shareholders is reviewed by the Board to ensure
that shareholder enquiries are promptly and adequately resolved.
Shareholders are encouraged to attend the Company's general meetings where the
Directors and representatives of the Company's advisers will be available to
answer any questions members may have. The notice of the Company's fourth annual
general meeting accompanies this report - separate resolutions are proposed for
each substantive issue.
The Board also communicates with shareholders through interim and annual reports
which will include a chairman's statement and an investment manager's report
both of which are reviewed and approved by the Board to ensure that they present
a fair assessment of the Company's position and future prospects.
Accountability and Audit
The statement of the Directors' responsibility in respect of the financial
statements and the independent auditor's report are presented on pages 24 and 25
respectively of this report.
Internal Audit
The Company does not have an independent internal audit function. Such a
function is thought by the Board to be unnecessary at this time given the size
of the Company and the nature of its business. However, the audit committee
considers annually whether an independent internal audit function should be
introduced and reports its conclusions to the Board.
Going Concern
After making enquiries, the Directors are satisfied that the Company has
adequate resources to continue to operate for the foreseeable future. For this
reason, the going concern basis has been adopted in the preparation of the
Company's financial statements.
Statement of Directors' Responsibilities
The Directors are responsible for preparing the Directors' Report and the
financial statements in accordance with applicable law and regulations.
Company law requires the Directors to prepare financial statements for each
financial year. Under that law the Directors have elected to prepare the
financial statements in accordance with United Kingdom Generally Accepted
Accounting Practice (United Kingdom Standards and applicable law). Under company
law the Directors must not approve the financial statements unless they are
satisfied that they give a true and fair view of the state of affairs of the
Company and of the profit or loss of the Company for that period. In preparing
these financial statements, the Directors are required to:
> select suitable accounting policies and then apply them consistently;
> make judgments and accounting estimates that are reasonable and
prudent;
> state whether applicable UK Accounting Standards have been followed,
subject to any material departures disclosed and explained in the financial
statements;
> prepare the financial statements on the going concern basis unless it
is inappropriate to presume that the Company will continue in business.
The Directors are responsible for keeping adequate accounting records that are
sufficient to show and explain the Company's transactions and disclose with
reasonable accuracy at any time the financial position of the Company and enable
them to ensure that the financial statements comply with the Companies Act 2006.
They are also responsible for safeguarding the assets of the Company and hence
for taking reasonable steps for the prevention and detection of fraud and other
irregularities. The Directors confirm that they have complied with these
requirements.
Under applicable law and regulations, the directors are also responsible for
preparing a Directors' Remuneration Report and Statement of Corporate Governance
that complies with law and those regulations.
In the case of each of the persons who are directors of the Company at the date
of approval of this report:
> so far as each of the Directors is aware, there is no relevant audit
information (as defined in the Companies Act 2006) of which the Company's
auditors are unaware.
> the Directors have taken all steps that they ought to have taken as a
Director to make themselves aware of any relevant audit information (as defined)
and to establish that the Company's auditors are aware of that information.
The Directors are responsible for the maintenance and integrity of the corporate
and financial information included on the Company's website. The work carried
out by Scott-Moncrieff as independent auditors of the Company does not involve
consideration of the maintenance and integrity of the website and accordingly
they accept no responsibility for any changes that have occurred to the
financial statements since they were initially presented on the website.
Legislation in the United Kingdom governing the preparation and dissemination of
the financial statements and other information included in annual reports may
differ from legislation in other jurisdictions.
Responsibility Statement of the Directors in respect of the Annual Financial
Report
We confirm that to the best of our knowledge:
> the financial statements, prepared in accordance with the applicable
set of accounting standards, give a true and fair view of the assets,
liabilities, financial position and profit or loss of the Company; and
> the Director's Report includes a fair review of the development and
performance of the business and the position of the issuer, together with a
description of the principal risks and uncertainties that they face.
Sir Robin Miller
Chairman
30 June 2010
Report of the Independent Auditor
to the Shareholders of Edge Performance VCT plc
We have audited the financial statements of Edge Performance VCT plc for the
year ended 28 February 2010, which comprise the Income Statement, the
Reconciliation of Movements in Shareholder's Funds, the Balance Sheet, the Cash
Flow Statement and the related notes. The financial reporting framework that has
been applied in their preparation is applicable law and United Kingdom
Accounting Standards (United Kingdom Generally Accepted Accounting Practice).
This report is made solely to the Company's members as a body, in accordance
with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been
undertaken so that we might state to the Company's members those matters we are
required to state to them in auditors' report and for no other purpose. To the
fullest extent permitted by law, we do not accept or assume responsibility to
anyone other than the Company and the Company's members as a body, for our audit
work, for this report, or for the opinions we have formed.
Respective responsibilities of directors and auditors
As explained more fully in the Statement of Directors' Responsibilities on page
24, the Directors are responsible for the preparation of the financial
statements and for being satisfied that they give a true and fair view. Our
responsibility is to audit the financial statements in accordance with
applicable law and International Standards on Auditing (UK and Ireland). Those
standards require us to comply with the Auditing Practices Board's Ethical
Standards for Auditors.
Scope of the audit of the financial statements
An audit involves obtaining evidence about the amounts and disclosures in the
financial statements sufficient to give reasonable assurance that the financial
statements are free from material misstatement, whether caused by fraud or
error. This includes an assessment of: whether the accounting policies are
appropriate to the Company's circumstances and have been consistently applied
and adequately disclosed; the reasonableness of significant accounting estimates
made by the Directors; and the overall presentation of the financial statements.
Opinion on financial statements
In our opinion the financial statements:
> give a true and fair view of the state of the Company's affairs as at
28 February 2010 and of its return for the year then ended;
> have been properly prepared in accordance with United Kingdom
Generally Accepted Accounting Practice; and
> have been prepared in accordance with the requirements of the
Companies Act 2006
Opinion on other matters prescribed by the Companies Act 2006
In our opinion:
> the part of the Directors' Remuneration Report to be audited has been
properly prepared in accordance with the Companies Act 2006;
> the information given in the Directors' Report for the financial year
for which the financial statements are prepared is consistent with the financial
statements; and
> the information given in the Corporate Governance Statement in
compliance with rules 7.2.5 and 7.2.6 in the Disclosure and Transparency Rules
sourcebook issued by the Financial Services Authority (information about
internal control and risk management systems in relation to financial reporting
processes and about share capital structures) is consistent with the financial
statements.
Matters on which we are required to report by exception
Under the Companies Act 2006 we are required to report to you if, in our
opinion:
> adequate accounting records have not been kept or returns adequate
for our audit have not been received from branches not visited by us; or
> the financial statements and the part of the Directors' Remuneration
Report to be audited are not in agreement with the accounting records and
returns; or
> certain disclosures of Directors' remuneration specified by law are
not made; or
> we have not received all the information and explanations we require
for our audit.
Under the Listing Rules we are required to review:
> the Directors' statement on page 23 in relation to going concern; and
> the part of the Corporate Governance Statement relating to the
Company's compliance with the nine provisions of the June 2008 Combined Code
specified for our review.
We have nothing to report in respect of these matters.
Graham Scrimgeour
(Senior Statutory Auditor)
For and on behalf of Scott-Moncrieff, Statutory Auditor
Exchange Place 3
Semple St
Edinburgh
EH3 8BL
30 June 2010
Income Statement
for the year ended 28 February 2010
+---------------------+--------+--------+---------+---------+---------+---------+---------+---------+
| | | | Year ended 28 February | Year ended 28 February |
| | | | 2010 | 2009 |
+---------------------+--------+--------+-----------------------------+-----------------------------+
| | | | Revenue | Capital | Total | Revenue | Capital | Total |
+---------------------+--------+--------+---------+---------+---------+---------+---------+---------+
| | | Note | GBP'000 | GBP'000 | GBP'000 | GBP'000 | GBP'000 | GBP'000 |
+---------------------+--------+--------+---------+---------+---------+---------+---------+---------+
| Realised/unrealised | | | - | (98) | (98) | - | (306) | (306) |
| movements on | | | | | | | | |
| investments | | | | | | | | |
+---------------------+--------+--------+---------+---------+---------+---------+---------+---------+
| Income | | 2 | 156 | - | 156 | 917 | - | 917 |
+---------------------+--------+--------+---------+---------+---------+---------+---------+---------+
| Investment | | 3 | (168) | (502) | (670) | (172) | (512) | (684) |
| manager's | | | | | | | | |
| fees | | | | | | | | |
+---------------------+--------+--------+---------+---------+---------+---------+---------+---------+
| Other | | 4 | (477) | (118) | (595) | (393) | - | (393) |
| expenses | | | | | | | | |
+---------------------+--------+--------+---------+---------+---------+---------+---------+---------+
| | | | | | | | | |
+---------------------+--------+--------+---------+---------+---------+---------+---------+---------+
| Return | | | (489) | (718) | (1,207) | 352 | (818) | (466) |
| on | | | | | | | | |
| ordinary | | | | | | | | |
| activities | | | | | | | | |
| before tax | | | | | | | | |
+---------------------+--------+--------+---------+---------+---------+---------+---------+---------+
| Tax on | | 6 | - | - | - | (74) | 74 | 0 |
| ordinary | | | | | | | | |
| activities | | | | | | | | |
+---------------------+--------+--------+---------+---------+---------+---------+---------+---------+
| | | | | | | | | |
+---------------------+--------+--------+---------+---------+---------+---------+---------+---------+
| Return | | | (489) | (718) | (1,207) | 278 | (744) | (466) |
| attributable | | | | | | | | |
| to equity | | | | | | | | |
| shareholders | | | | | | | | |
+---------------------+--------+--------+---------+---------+---------+---------+---------+---------+
| | | | | | | | | |
+---------------------+--------+--------+---------+---------+---------+---------+---------+---------+
| Transfer | | | (489) | (718) | (1,207) | 278 | (744) | (466) |
| to | | | | | | | | |
| reserves | | | | | | | | |
+---------------------+--------+--------+---------+---------+---------+---------+---------+---------+
| | | | | | | | | |
+---------------------+--------+--------+---------+---------+---------+---------+---------+---------+
| Return | | | | | | | | |
| per | | | | | | | | |
| share | | | | | | | | |
+---------------------+--------+--------+---------+---------+---------+---------+---------+---------+
| Return | | 8 | (0.90)p | (3.08)p | (3.98)p | (0.37)p | (2.14)p | (2.51)p |
| per | | | | | | | | |
| ordinary | | | | | | | | |
| share | | | | | | | | |
+---------------------+--------+--------+---------+---------+---------+---------+---------+---------+
| Return | | 8 | (0.65)p | (2.36)p | (3.01)p | 1.55p | (4.34)p | (2.79)p |
| per C | | | | | | | | |
| share | | | | | | | | |
+---------------------+--------+--------+---------+---------+---------+---------+---------+---------+
| Return | | 8 | (1.23)p | (0.79)p | (2.02)p | 0.55p | (0.16)p | 0.39p |
| per D | | | | | | | | |
| share | | | | | | | | |
+---------------------+--------+--------+---------+---------+---------+---------+---------+---------+
| Return | | 8 | (1.24)p | (0.62)p | (1.86)p | n/a | n/a | n/a |
| per E | | | | | | | | |
| share | | | | | | | | |
+---------------------+--------+--------+---------+---------+---------+---------+---------+---------+
The total column of this statement represents the profit and loss account of the
Company. All revenue and capital items in the above statement derive from
continuing operations. The Company has only one class of business and derives
its income from investments made in shares, securities and bank deposits. The
Company has no gains and losses other than those recognised in the Income
Statement above and has not therefore prepared a separate statement of
recognised gains and losses.
The accompanying notes on pages 33 to 41 are an integral part of the financial
statements.
Income Statement
for the year ended 28 February 2010
Unaudited Non-Statutory Analysis between
the O, C, D and E Share Funds
+---------------------+--------+--------+---------+---------+---------+---------+---------+---------+
| | | | *O share fund | C share fund |
+---------------------+--------+--------+-----------------------------+-----------------------------+
| | | | Revenue | Capital | Total | Revenue | Capital | Total |
+---------------------+--------+--------+---------+---------+---------+---------+---------+---------+
| | | | GBP'000 | GBP'000 | GBP'000 | GBP'000 | GBP'000 | GBP'000 |
+---------------------+--------+--------+---------+---------+---------+---------+---------+---------+
| Realised/unrealised | | | - | (58) | (58) | - | (178) | (178) |
| movements on | | | | | | | | |
| investments | | | | | | | | |
+---------------------+--------+--------+---------+---------+---------+---------+---------+---------+
| Income | | | 5 | - | 5 | 60 | - | 60 |
+---------------------+--------+--------+---------+---------+---------+---------+---------+---------+
| Investment | | | (7) | (21) | (28) | (45) | (136) | (181) |
| manager's | | | | | | | | |
| fees | | | | | | | | |
+---------------------+--------+--------+---------+---------+---------+---------+---------+---------+
| Other | | | (55) | (118) | (173) | (102) | - | (102) |
| expenses | | | | | | | | |
+---------------------+--------+--------+---------+---------+---------+---------+---------+---------+
| | | | | | | | | |
+---------------------+--------+--------+---------+---------+---------+---------+---------+---------+
| Return | | | (57) | (197) | (254) | (87) | (314) | (401) |
| on | | | | | | | | |
| ordinary | | | | | | | | |
| activities | | | | | | | | |
| before tax | | | | | | | | |
+---------------------+--------+--------+---------+---------+---------+---------+---------+---------+
| Tax on | | | - | - | - | - | - | - |
| ordinary | | | | | | | | |
| activities | | | | | | | | |
+---------------------+--------+--------+---------+---------+---------+---------+---------+---------+
| | | | | | | | | |
+---------------------+--------+--------+---------+---------+---------+---------+---------+---------+
| Return | | | (57) | (197) | (254) | (87) | (314) | (401) |
| attributable | | | | | | | | |
| to equity | | | | | | | | |
| shareholders | | | | | | | | |
+---------------------+--------+--------+---------+---------+---------+---------+---------+---------+
| | | | | | | | | |
+---------------------+--------+--------+---------+---------+---------+---------+---------+---------+
| Transfer | | | (57) | (197) | (254) | (87) | (314) | (401) |
| to | | | | | | | | |
| reserves | | | | | | | | |
+---------------------+--------+--------+---------+---------+---------+---------+---------+---------+
| | | | | | | | | |
+---------------------+--------+--------+---------+---------+---------+---------+---------+---------+
| Return | | | (0.90)p | (3.08)p | (3.98)p | (0.65)p | (2.36)p | (3.01)p |
| per | | | | | | | | |
| share | | | | | | | | |
+---------------------+--------+--------+---------+---------+---------+---------+---------+---------+
*For period from 1 March 2009 to 21 December 2009 when the ordinary shares were
converted to deferred shares and then cancelled.
+---------------------+--------+--------+---------+---------+---------+---------+---------+---------+
| | | | D share fund | E share fund |
+---------------------+--------+--------+-----------------------------+-----------------------------+
| | | | Revenue | Capital | Total | Revenue | Capital | Total |
+---------------------+--------+--------+---------+---------+---------+---------+---------+---------+
| | | | GBP'000 | GBP'000 | GBP'000 | GBP'000 | GBP'000 | GBP'000 |
+---------------------+--------+--------+---------+---------+---------+---------+---------+---------+
| Realised/unrealised | | | - | 84 | 84 | - | 54 | 54 |
| movements on | | | | | | | | |
| investments | | | | | | | | |
+---------------------+--------+--------+---------+---------+---------+---------+---------+---------+
| Income | | | 73 | - | 73 | 18 | - | 18 |
+---------------------+--------+--------+---------+---------+---------+---------+---------+---------+
| Investment | | | (79) | (237) | (316) | (37) | (108) | (145) |
| manager's | | | | | | | | |
| fees | | | | | | | | |
+---------------------+--------+--------+---------+---------+---------+---------+---------+---------+
| Other | | | (229) | - | (229) | (91) | - | (91) |
| expenses | | | | | | | | |
+---------------------+--------+--------+---------+---------+---------+---------+---------+---------+
| | | | | | | | | |
+---------------------+--------+--------+---------+---------+---------+---------+---------+---------+
| Return | | | (235) | (153) | (388) | (110) | (54) | (164) |
| on | | | | | | | | |
| ordinary | | | | | | | | |
| activities | | | | | | | | |
| before tax | | | | | | | | |
+---------------------+--------+--------+---------+---------+---------+---------+---------+---------+
| Tax on | | | - | - | - | - | - | - |
| ordinary | | | | | | | | |
| activities | | | | | | | | |
+---------------------+--------+--------+---------+---------+---------+---------+---------+---------+
| | | | | | | | | |
+---------------------+--------+--------+---------+---------+---------+---------+---------+---------+
| Return | | | (235) | (153) | (388) | (110) | (54) | (164) |
| attributable | | | | | | | | |
| to equity | | | | | | | | |
| shareholders | | | | | | | | |
+---------------------+--------+--------+---------+---------+---------+---------+---------+---------+
| | | | | | | | | |
+---------------------+--------+--------+---------+---------+---------+---------+---------+---------+
| Transfer | | | (235) | (153) | (388) | (110) | (54) | (164) |
| to | | | | | | | | |
| reserves | | | | | | | | |
+---------------------+--------+--------+---------+---------+---------+---------+---------+---------+
| | | | | | | | | |
+---------------------+--------+--------+---------+---------+---------+---------+---------+---------+
| Return | | | (1.23)p | (0.79)p | (2.02)p | (1.24)p | (0.62)p | (1.86)p |
| per | | | | | | | | |
| share | | | | | | | | |
+---------------------+--------+--------+---------+---------+---------+---------+---------+---------+
Balance Sheet
as at 28 February 2010
+-------------+--------+----------+----------+
| | | As at | As at |
+-------------+--------+----------+----------+
| | | 28 | 28 |
| | | February | February |
+-------------+--------+----------+----------+
| | | 2010 | 2009 |
+-------------+--------+----------+----------+
| | Note | GBP'000 | GBP'000 |
+-------------+--------+----------+----------+
| Fixed | | | |
| assets | | | |
+-------------+--------+----------+----------+
| Investments | 1 & 9 | 11,078 | 6,416 |
+-------------+--------+----------+----------+
| | | | |
+-------------+--------+----------+----------+
| Current | | | |
| assets | | | |
+-------------+--------+----------+----------+
| Debtors | 11 | 157 | 573 |
+-------------+--------+----------+----------+
| Corporate | 1 | 23,744 | 26,734 |
| bond & | | | |
| other | | | |
| liquidity | | | |
| funds | | | |
+-------------+--------+----------+----------+
| Cash | | 793 | 934 |
| at | | | |
| bank | | | |
+-------------+--------+----------+----------+
| | | 24,694 | 28,241 |
+-------------+--------+----------+----------+
| | | | |
+-------------+--------+----------+----------+
| Creditors: | 12 | (241) | (1,566) |
| amounts | | | |
| falling | | | |
| due within | | | |
| one year | | | |
+-------------+--------+----------+----------+
| | | | |
+-------------+--------+----------+----------+
| Net | | 24,453 | 26,675 |
| current | | | |
| assets | | | |
+-------------+--------+----------+----------+
| | | | |
+-------------+--------+----------+----------+
| Net | | 35,531 | 33,091 |
| assets | | | |
+-------------+--------+----------+----------+
| | | | |
+-------------+--------+----------+----------+
| Capital | | | |
| and | | | |
| reserves | | | |
+-------------+--------+----------+----------+
| Called | 13 | 4,237 | 3,896 |
| up | | | |
| share | | | |
| capital | | | |
+-------------+--------+----------+----------+
| Share | 14 | 45 | 45 |
| premium | | | |
| account | | | |
+-------------+--------+----------+----------+
| Special | 14 | 32,855 | 30,045 |
| reserve | | | |
+-------------+--------+----------+----------+
| Realised | 14 | (1,194) | (525) |
| capital | | | |
| reserve | | | |
+-------------+--------+----------+----------+
| Unrealised | 14 | (47) | (538) |
| capital | | | |
| reserve | | | |
+-------------+--------+----------+----------+
| Revenue | 14 | (365) | 168 |
| reserves | | | |
+-------------+--------+----------+----------+
| | | 35,531 | 33,091 |
+-------------+--------+----------+----------+
| | | | |
+-------------+--------+----------+----------+
| Net | 15 | - | 69.09p |
| asset | | | |
| value | | | |
| per | | | |
| ordinary | | | |
| share | | | |
+-------------+--------+----------+----------+
| Net | 15 | 75.80p | 78.81p |
| asset | | | |
| value | | | |
| per C | | | |
| share | | | |
+-------------+--------+----------+----------+
| Net | 15 | 85.45p | 94.47p |
| asset | | | |
| value | | | |
| per D | | | |
| share | | | |
+-------------+--------+----------+----------+
| Net | 15 | 91.68p | n/a |
| asset | | | |
| value | | | |
| per E | | | |
| share | | | |
+-------------+--------+----------+----------+
The accompanying notes on pages 33 to 41 are an integral part of the financial
statements.
The financial statements were authorised for issue by the directors on 30 June
2010 and signed on their behalf by:
Sir Robin Miller David Glick
Director
Director
Balance Sheet
as at 28 February 2010
Unaudited Non-Statutory Analysis between
the C, D and E Share Funds
+-------------+---------+---------+---------+---------+
| | O | C | D | E |
| | share | share | share | share |
| | fund | fund | fund | fund |
| | GBP'000 | GBP'000 | GBP'000 | GBP'000 |
+-------------+---------+---------+---------+---------+
| Fixed | | | | |
| assets | | | | |
+-------------+---------+---------+---------+---------+
| Investments | - | 6,328 | 4,750 | - |
+-------------+---------+---------+---------+---------+
| | | | | |
+-------------+---------+---------+---------+---------+
| Current | | | | |
| assets | | | | |
+-------------+---------+---------+---------+---------+
| Debtors | 32 | 63 | 16 | 46 |
+-------------+---------+---------+---------+---------+
| Corporate | - | 3,416 | 13,905 | 6,423 |
| bond & | | | | |
| other | | | | |
| liquidity | | | | |
| funds | | | | |
+-------------+---------+---------+---------+---------+
| Cash | (2) | 369 | (2,160) | 2,586 |
| at | | | | |
| bank | | | | |
+-------------+---------+---------+---------+---------+
| | 30 | 3,848 | 11,761 | 9,055 |
+-------------+---------+---------+---------+---------+
| | | | | |
+-------------+---------+---------+---------+---------+
| Creditors: | (30) | (74) | (80) | (57) |
| amounts | | | | |
| falling | | | | |
| due within | | | | |
| one year | | | | |
+-------------+---------+---------+---------+---------+
| | | | | |
+-------------+---------+---------+---------+---------+
| Net | - | 3,774 | 11,681 | 8,998 |
| current | | | | |
| assets | | | | |
+-------------+---------+---------+---------+---------+
| | | | | |
+-------------+---------+---------+---------+---------+
| Net | - | 10,102 | 16,431 | 8,998 |
| assets | | | | |
+-------------+---------+---------+---------+---------+
| | | | | |
+-------------+---------+---------+---------+---------+
| Capital | | | | |
| and | | | | |
| reserves | | | | |
+-------------+---------+---------+---------+---------+
| Called | - | 1,333 | 1,923 | 981 |
| up | | | | |
| share | | | | |
| capital | | | | |
+-------------+---------+---------+---------+---------+
| Share | - | - | 45 | - |
| premium | | | | |
| account | | | | |
+-------------+---------+---------+---------+---------+
| Special | - | 9,834 | 14,841 | 8,180 |
| reserve | | | | |
+-------------+---------+---------+---------+---------+
| Realised | - | (804) | (283) | (107) |
| capital | | | | |
| reserve | | | | |
+-------------+---------+---------+---------+---------+
| Unrealised | - | (202) | 102 | 53 |
| capital | | | | |
| reserve | | | | |
+-------------+---------+---------+---------+---------+
| Revenue | - | (59) | (197) | (109) |
| reserves | | | | |
+-------------+---------+---------+---------+---------+
| | - | 10,102 | 16,431 | 8,998 |
+-------------+---------+---------+---------+---------+
| | | | | |
+-------------+---------+---------+---------+---------+
| Net | | 75.80p | | |
| asset | | | | |
| value | | | | |
| per C | | | | |
| share | | | | |
+-------------+---------+---------+---------+---------+
| Net | | | 85.45p | |
| asset | | | | |
| value | | | | |
| per D | | | | |
| share | | | | |
+-------------+---------+---------+---------+---------+
| Net | | | | 91.68p |
| asset | | | | |
| value | | | | |
| per E | | | | |
| share | | | | |
+-------------+---------+---------+---------+---------+
Reconciliation of Movements in Shareholders' Funds
for the year ended 28 February 2010
+---------------+---------+---------+
| | 2010 | 2009 |
| | GBP'000 | GBP'000 |
+---------------+---------+---------+
| Total | 33,091 | 21,439 |
| net | | |
| assets | | |
| attributable | | |
| at 28 | | |
| February | | |
+---------------+---------+---------+
| Capital | 9,716 | 15,754 |
| per | | |
| share | | |
| issues | | |
+---------------+---------+---------+
| Expenses | (545) | (864) |
| of issue | | |
+---------------+---------+---------+
| Expenses | (10) | (10) |
| of share | | |
| premium | | |
| cancellation | | |
+---------------+---------+---------+
| Expenses | (8) | - |
| of O | | |
| share | | |
| conversion | | |
| and | | |
| cancellation | | |
+---------------+---------+---------+
| Return | (1,207) | (466) |
| for | | |
| the | | |
| year | | |
+---------------+---------+---------+
| Dividends | (5,506) | (2,762) |
+---------------+---------+---------+
| Closing | 35,531 | 33,091 |
| shareholders' | | |
| funds at 28 | | |
| February | | |
+---------------+---------+---------+
Unaudited Non-Statutory Analysis between the Ordinary, C, D and E Share Funds
Reconciliation of Movements in Shareholders' Funds
for the year ended 28 February 2010
+---------------+----------+---------+---------+---------+
| | Ordinary | C | D | E |
| | | share | share | share |
| | share | fund | fund | fund |
| | fund | GBP'000 | GBP'000 | GBP'000 |
| | GBP'000 | | | |
+---------------+----------+---------+---------+---------+
| Opening | 4,422 | 10,504 | 18,165 | - |
| shareholders' | | | | |
| funds | | | | |
+---------------+----------+---------+---------+---------+
| Share | - | - | - | 9,716 |
| capital | | | | |
| subscribed | | | | |
| for in the | | | | |
| year | | | | |
+---------------+----------+---------+---------+---------+
| Expenses | - | - | - | (545) |
| of issue | | | | |
+---------------+----------+---------+---------+---------+
| Expenses | - | - | - | (10) |
| of share | | | | |
| premium | | | | |
| cancellation | | | | |
+---------------+----------+---------+---------+---------+
| Expenses | (8) | - | - | - |
| of O | | | | |
| share | | | | |
| conversion | | | | |
| and | | | | |
| cancellation | | | | |
+---------------+----------+---------+---------+---------+
| Return | (254) | (402) | (388) | (163) |
| for | | | | |
| the | | | | |
| year | | | | |
+---------------+----------+---------+---------+---------+
| Dividends | (4,160) | - | (1,346) | - |
+---------------+----------+---------+---------+---------+
| Closing | - | 10,102 | 16,431 | 8,998 |
| shareholders' | | | | |
| funds at 28 | | | | |
| February 2010 | | | | |
+---------------+----------+---------+---------+---------+
Cash Flow Statement
for the year ended 28 February 2010
+---------------------+--------+--------+--------+--------+---------+---------+----------+----------+
| | Year ended | Year ended |
| | 28 February | 28 February |
| | 2010 | 2009 |
+---------------------------------------------------------+-------------------+---------------------+
| | Note | GBP'000 | GBP'000 | GBP'000 | GBP'000 |
+------------------------------------------------+--------+---------+---------+----------+----------+
| Operating | | | | | | | | |
| activities | | | | | | | | |
+---------------------+--------+--------+--------+--------+---------+---------+----------+----------+
| Investment | | | | | 60 | | 853 | |
| income | | | | | | | | |
| received | | | | | | | | |
+---------------------+--------+--------+--------+--------+---------+---------+----------+----------+
| Deposit | | | | | 1 | | 81 | |
| and | | | | | | | | |
| similar | | | | | | | | |
| interest | | | | | | | | |
| received | | | | | | | | |
+---------------------+--------+--------+--------+--------+---------+---------+----------+----------+
| Other | | | | | 92 | | - | |
| cash | | | | | | | | |
| receipts | | | | | | | | |
| (VAT | | | | | | | | |
| recovery) | | | | | | | | |
+---------------------+--------+--------+--------+--------+---------+---------+----------+----------+
| Investment | | | | | (888) | | (731) | |
| manager's | | | | | | | | |
| fees paid | | | | | | | | |
+---------------------+--------+--------+--------+--------+---------+---------+----------+----------+
| Company | | | | | (72) | | (29) | |
| secretarial | | | | | | | | |
| fees paid | | | | | | | | |
+---------------------+--------+--------+--------+--------+---------+---------+----------+----------+
| Administration | | | | | (101) | | (53) | |
| fees paid | | | | | | | | |
+---------------------+--------+--------+--------+--------+---------+---------+----------+----------+
| Cash | | | | | (85) | | (89) | |
| paid | | | | | | | | |
| to and | | | | | | | | |
| on | | | | | | | | |
| behalf | | | | | | | | |
| of | | | | | | | | |
| directors | | | | | | | | |
+---------------------+--------+--------+--------+--------+---------+---------+----------+----------+
| Other | | | | | (108) | | (84) | |
| cash | | | | | | | | |
| payments | | | | | | | | |
+---------------------+--------+--------+--------+--------+---------+---------+----------+----------+
| Net | | | | 16 | | (1,101) | | (52) |
| cash | | | | | | | | |
| inflow/(outflow) | | | | | | | | |
| from operating | | | | | | | | |
| activities | | | | | | | | |
+---------------------+--------+--------+--------+--------+---------+---------+----------+----------+
| | | | | | | | | |
+---------------------+--------+--------+--------+--------+---------+---------+----------+----------+
| Financial | | | | | | | | |
| investment | | | | | | | | |
+---------------------+--------+--------+--------+--------+---------+---------+----------+----------+
| Purchase | | | | | (6,776) | | (2,715) | |
| of | | | | | | | | |
| unquoted | | | | | | | | |
| investments | | | | | | | | |
+---------------------+--------+--------+--------+--------+---------+---------+----------+----------+
| Sale | | | | | 4,122 | | - | |
| of | | | | | | | | |
| unquoted | | | | | | | | |
| investments | | | | | | | | |
+---------------------+--------+--------+--------+--------+---------+---------+----------+----------+
| Loans | | | | | (347) | | (314) | |
+---------------------+--------+--------+--------+--------+---------+---------+----------+----------+
| Purchase | | | | | (8,600) | | (17,545) | |
| of | | | | | | | | |
| liquidity | | | | | | | | |
| funds | | | | | | | | |
+---------------------+--------+--------+--------+--------+---------+---------+----------+----------+
| Sale | | | | | 10,189 | | 4,869 | |
| of | | | | | | | | |
| liquidity | | | | | | | | |
| funds | | | | | | | | |
+---------------------+--------+--------+--------+--------+---------+---------+----------+----------+
| Net | | | | | | (1,412) | | (15,705) |
| cash | | | | | | | | |
| outflow | | | | | | | | |
| from | | | | | | | | |
| financial | | | | | | | | |
| investment | | | | | | | | |
+---------------------+--------+--------+--------+--------+---------+---------+----------+----------+
| | | | | | | | | |
+---------------------+--------+--------+--------+--------+---------+---------+----------+----------+
| Tax & | | | | | | | | |
| dividends | | | | | | | | |
+---------------------+--------+--------+--------+--------+---------+---------+----------+----------+
| Tax | | | | | - | | (14) | |
+---------------------+--------+--------+--------+--------+---------+---------+----------+----------+
| Equity | | | | | (6,887) | | (1,381) | |
| dividends | | | | | | | | |
| paid | | | | | | | | |
+---------------------+--------+--------+--------+--------+---------+---------+----------+----------+
| Net | | | | | | (6,887) | | (1,395) |
| cash | | | | | | | | |
| outflow | | | | | | | | |
| from | | | | | | | | |
| tax & | | | | | | | | |
| dividends | | | | | | | | |
+---------------------+--------+--------+--------+--------+---------+---------+----------+----------+
| | | | | | | | | |
+---------------------+--------+--------+--------+--------+---------+---------+----------+----------+
| Net | | | | | | (9,400) | | (17,152) |
| cash | | | | | | | | |
| outflow | | | | | | | | |
| before | | | | | | | | |
| financing | | | | | | | | |
+---------------------+--------+--------+--------+--------+---------+---------+----------+----------+
| | | | | | | | | |
+---------------------+--------+--------+--------+--------+---------+---------+----------+----------+
| Financing | | | | | | | | |
+---------------------+--------+--------+--------+--------+---------+---------+----------+----------+
| Cancellation | | | | | (10) | | (10) | |
| of share | | | | | | | | |
| premium | | | | | | | | |
| accounts | | | | | | | | |
+---------------------+--------+--------+--------+--------+---------+---------+----------+----------+
| Conversion | | | | | (2) | | - | |
| & | | | | | | | | |
| cancellation | | | | | | | | |
| of O shares | | | | | | | | |
+---------------------+--------+--------+--------+--------+---------+---------+----------+----------+
| New | | | | | 9,730 | | 15,505 | |
| share | | | | | | | | |
| issues | | | | | | | | |
+---------------------+--------+--------+--------+--------+---------+---------+----------+----------+
| Share | | | | | (459) | | (796) | |
| issue | | | | | | | | |
| expenses | | | | | | | | |
+---------------------+--------+--------+--------+--------+---------+---------+----------+----------+
| | | | | | | | | |
+---------------------+--------+--------+--------+--------+---------+---------+----------+----------+
| Net | | | | | | 9,259 | | 14,699 |
| cash | | | | | | | | |
| inflow | | | | | | | | |
| from | | | | | | | | |
| financing | | | | | | | | |
+---------------------+--------+--------+--------+--------+---------+---------+----------+----------+
| | | | | | | | | |
+---------------------+--------+--------+--------+--------+---------+---------+----------+----------+
| (Decrease)/Increase | | | | | | (141) | | (2,453) |
| in cash | | | | | | | | |
+---------------------+--------+--------+--------+--------+---------+---------+----------+----------+
The accompanying notes on pages 33 to 41 are an integral part of the financial
statements.
Notes to the Financial Statements
1. Accounting policies
A summary of the principal accounting policies, all of which have been applied
consistently throughout the year, is set out below.
a) Basis of Accounting
The accounts have been prepared in accordance with applicable
Accounting Standards and with the Statement of Recommended Practice, 'Financial
Statements of Investment Trust Companies' ("SORP"), revised in January 2009.
b) Investments
The Company did not hold any listed investments at any time during
the period under review. In accordance with UK Generally Accepted Accounting
Practice ("UK GAAP"), investments in unlisted companies, other than those traded
on AIM/PLUS, are valued at fair value by the Directors with reference to the
following guidelines:
- Investments which have been made within the last twelve months are
valued at cost except where the company's performance against plan is
significantly below the expectations on which the investment was made, in which
case provision against cost is made as appropriate
- Where a company is in the early stage of development, it will
normally continue to be held at cost on the basis described above
- Where a company is well established after one year from the date of
investment the shares may be valued by applying a suitable price-earnings ratio
to that company's historical post tax earnings. The ratio used is based on a
comparable listed company or sector but discounted to reflect lack of
marketability. Alternative methods of valuation will include cost, provision
against cost or net asset value where such factors apply that make one of these
methods more appropriate.
Alternatively, where a value is indicated by a material
arm's-length transaction by a third party in the shares of a company, the
valuation will normally be based on this.
Investments in companies traded on AIM/PLUS will be valued at their
bid prices as appropriate.
Realised surpluses or deficits on the disposal of investments and
impairments in the value of investments are taken to realised capital reserves,
and unrealised surpluses and deficits on the revaluation of investments are
taken to unrealised capital reserves.
c) Income
Dividends receivable on listed equity shares are brought into
account on the ex-dividend date. Dividends receivable on unlisted equity shares
are brought into account when the Company's right to receive payment is
established and there is no reasonable doubt that payment will be received.
Fixed returns on non-equity shares and debt securities are recognised on a time
apportionment basis so as to reflect the effective yield, provided there is no
reasonable doubt that payment will be received in due course.
d) Expenses
All expenses (inclusive of VAT where appropriate) are accounted for
on an accruals basis. Expenses are charged wholly to revenue, with the exception
of expenses incidental to the acquisition or disposal of an investment, which
are included within the cost of the investment or deducted from the disposal
proceeds as appropriate, and with the exception that 75% of the investment
management fees payable to Edge Investment Management Limited are charged
against capital.
e) Deferred Tax
Deferred tax is recognised in respect of all timing differences
that have originated but not reversed at the balance sheet date where
transactions or events that result in an obligation to pay more, or right to pay
less, tax in the future have occurred at the balance sheet date. This is subject
to deferred tax assets only being recognised if it is considered more likely
than not that there will be suitable profits from which the future reversal of
the underlying timing differences can be deducted. Timing differences are
differences arising between the Company's taxable profits and its results as
stated in the financial statements which are capable of reversal in one or more
subsequent periods. Due to the Company's status as a Venture Capital Trust, and
the intention to continue meeting the conditions required to obtain approval in
the foreseeable future, the Company has not provided deferred tax on any capital
gains and losses arising in the revaluation or disposal of investments.
f) Financial Instruments
The Company's financial instruments comprise its investment
portfolio and cash balances. The Company holds financial assets that comprise
investments in corporate bonds. The fair value is not materially different from
the carrying value for all financial assets and liabilities.
2. Income
+-------------+--------+--------+--------+--------+--------+--------+---------+---------+
| | 2010 | 2009 |
| | GBP'000 | GBP'000 |
+-------------------------------------------------------------------+---------+---------+
| Interest | | | | | | | | |
| receivable | | | | | | | | |
+-------------+--------+--------+--------+--------+--------+--------+---------+---------+
| - from | | | | | | | 4 | 34 |
| Rothschild | | | | | | | | |
| Preferred | | | | | | | | |
| Income | | | | | | | | |
| Fund | | | | | | | | |
+-------------+--------+--------+--------+--------+--------+--------+---------+---------+
| - from | | | | | | | 152 | 883 |
| cash | | | | | | | | |
| and | | | | | | | | |
| cash | | | | | | | | |
| equivalents | | | | | | | | |
+-------------+--------+--------+--------+--------+--------+--------+---------+---------+
| | | | | | | | 156 | 917 |
+-------------+--------+--------+--------+--------+--------+--------+---------+---------+
3. Investment Manager's Fees
+--------------------------+--------+--------+--------+--------+--------+--------+---------+---------+
| | 2010 | 2009 |
| | GBP'000 | GBP'000 |
+--------------------------------------------------------------------------------+---------+---------+
| Edge Investment | | | | | | | 670 | 684 |
| Management | | | | | | | | |
+--------------------------+--------+--------+--------+--------+--------+--------+---------+---------+
| | | | | | | | | |
+--------------------------+--------+--------+--------+--------+--------+--------+---------+---------+
The annual investment management fee was GBP675,298. A further VAT recovery of
GBP5,605 in respect of VAT incurred on investment management fees was set off
against the fee.
The Company entered into an agreement dated 3 February 2006 with the Manager,
which has responsibility for the management of the Company's portfolio of
investments. On 12 December 2006 the agreement was amended and replaced with a
new agreement for an initial period of five years from admission of the C shares
and which may be terminated thereafter by either party on 12 months' notice
expiring at the end of the fixed term or at any time thereafter. On 5 November
2007 the agreement was replaced with a new agreement continuing for an initial
period ending five years from admission of the D shares and which may be
terminated thereafter by either party on 12 months' notice, such notice to be
served at the end of the initial period or at any time thereafter. On 14 January
2009 the agreement was replaced with a new agreement continuing for an initial
period ending five years from admission of the E shares and which may be
terminated thereafter by either party on 12 months' notice, such notice to be
served at the end of the initial period or at any time thereafter.
On 12 November 2009, the agreement was again replaced with a new agreement
continuing for an initial period ending 5 years from Admission of the F Shares
and which may be terminated thereafter by either party on 12 months' notice,
such notice to be served at the end of the initial period or at any time
thereafter.
The Manager will receive: an annual management fee of 1.75% of the net asset
value attributable to the C Shares, D Shares, E Shares and F Shares, in each
case plus VAT (if applicable); and (b) a performance fee which is outlined in
more detail below. Annual running costs of the Company will include, inter alia,
the management fees described above (excluding the performance fee), Directors'
remuneration, company secretarial and accounting fees, administration fees,
audit, taxation advice, sponsor's and registrar's fees and the costs of
communicating with the Shareholders.
The Manager will be responsible for external costs, such as legal and accounting
fees, incurred on all transactions that do not proceed to completion. The
Manager retains the right to charge arrangement, monitoring, syndication, exit
and directors' fees to the Events Companies and other businesses in which the
Company invests. Such charges are in line with industry practice and typically
amount to between 1% and 3% of the amount of each investment plus VAT (if
applicable). The Manager will normally nominate one of its directors to act as a
director of each Events Company.
Total annual operating expenses of the Company (excluding EIM's performance
incentive fee, trail commission, irrecoverable VAT and costs of any significant
corporate activity) have been capped at 3.0% of the net asset value of the
Company with any excess being borne by the Manager.
Performance related incentive fee
In respect of the C Shares, D Shares, E Shares and F Shares, the Manager will
receive a fee equal to 19% of the cumulative cash (prior to calculation of the
performance fee) returned to C Shareholders, D Shareholders, E Shareholders and
F Shareholders by the Company of between 100p and 120p per C Share, D Share, E
Share and F Share respectively and a fee equal to 29% of the cumulative cash
(prior to calculation of the performance fee) returned to C Shareholders, D
Shareholders, E Shareholders and F Shareholders by the Company in excess of 120p
per C Share, D Share, E Share and F Share respectively. This fee is to be paid
in cash and can be assigned by the Manager to some or all of the investment
team.
4. Other Expenses
+-----------------+--------+--------+--------+--------+--------+--------+---------+---------+
| | 2010 | 2009 |
| | GBP'000 | GBP'000 |
+-----------------------------------------------------------------------+---------+---------+
| Directors' | | | | | | | 70 | 87 |
| remuneration | | | | | | | | |
| (inc | | | | | | | | |
| expenses) | | | | | | | | |
+-----------------+--------+--------+--------+--------+--------+--------+---------+---------+
| Company | | | | | | | 50 | 50 |
| secretarial | | | | | | | | |
| & | | | | | | | | |
| accountancy | | | | | | | | |
| fees | | | | | | | | |
+-----------------+--------+--------+--------+--------+--------+--------+---------+---------+
| *Administration | | | | | | | 88 | 106 |
| fees | | | | | | | | |
+-----------------+--------+--------+--------+--------+--------+--------+---------+---------+
| Audit | | | | | | | 13 | 12 |
| fees - | | | | | | | | |
| for | | | | | | | | |
| audit | | | | | | | | |
| services | | | | | | | | |
+-----------------+--------+--------+--------+--------+--------+--------+---------+---------+
| VCT | | | | | | | 7 | 2 |
| status | | | | | | | | |
| adviser | | | | | | | | |
| fees | | | | | | | | |
+-----------------+--------+--------+--------+--------+--------+--------+---------+---------+
| Printing | | | | | | | 16 | 14 |
| & | | | | | | | | |
| stationery | | | | | | | | |
+-----------------+--------+--------+--------+--------+--------+--------+---------+---------+
| Other | | | | | | | 317 | 83 |
| costs | | | | | | | | |
+-----------------+--------+--------+--------+--------+--------+--------+---------+---------+
| Irrecoverable | | | | | | | 34 | 39 |
| VAT | | | | | | | | |
+-----------------+--------+--------+--------+--------+--------+--------+---------+---------+
| | | | | | | | 595 | 393 |
+-----------------+--------+--------+--------+--------+--------+--------+---------+---------+
In the year, investment acquisition costs of GBP8,050 (GBP14,708) were incurred.
At the year-end, these costs were transferred from fixed assets to unrealised
adjustments in value of investments.
The Company has no employees.
*The Company pays an annual administration fee to the investment manager which,
for the year ended 28 February 2010, was GBP88,082 exclusive of VAT. The
comparative sum for the year ended 28 February 2009 was GBP70,000; the balance
of GBP36,000 incurred as administration fees was a sum approved retrospectively
in respect of the period from 1 October 2006 to 29 February 2008 and was the sum
paid by the investment manager to a third party for company secretarial and
accountancy fees.
5. Directors' Fees
+----------+--------+--------+--------+--------+--------+--------+---------+---------+
| | 2010 | 2009 |
| | GBP'000 | GBP'000 |
+----------------------------------------------------------------+---------+---------+
| Frank | | | | | | | 12.5 | 15.75 |
| Presland | | | | | | | | |
+----------+--------+--------+--------+--------+--------+--------+---------+---------+
| Amounts | | | | | | | | |
| paid | | | | | | | | |
| and | | | | | | | | |
| payable | | | | | | | | |
| to | | | | | | | | |
| third | | | | | | | | |
| parties | | | | | | | | |
| for the | | | | | | | | |
| services | | | | | | | | |
| of: | | | | | | | | |
+----------+--------+--------+--------+--------+--------+--------+---------+---------+
| Sir | | | | | | | 15.00 | 19.50 |
| Robin | | | | | | | | |
| Miller | | | | | | | | |
+----------+--------+--------+--------+--------+--------+--------+---------+---------+
| *Julian | | | | | | | 16.25 | 16.25 |
| Paul | | | | | | | | |
+----------+--------+--------+--------+--------+--------+--------+---------+---------+
| Michael | | | | | | | 12.50 | 15.75 |
| Eaton | | | | | | | | |
+----------+--------+--------+--------+--------+--------+--------+---------+---------+
| David | | | | | | | 12.50 | 15.75 |
| Glick | | | | | | | | |
+----------+--------+--------+--------+--------+--------+--------+---------+---------+
| | | | | | | | 68.75 | 83.00 |
+----------+--------+--------+--------+--------+--------+--------+---------+---------+
No pension scheme contributions or other retirement benefit contributions were
paid. There are no share option contracts held by the Directors. Since all of
the fee earning Directors are non-executive, the other disclosures required by
the Listing Rules are not relevant.
*The amount paid and payable to Julian Paul comprises a consultancy fee of
GBP3,750 and a director's fee of GBP12,500. The comparative sum in 2009
comprised only a director's fee.
6. Tax on Ordinary Activities
a) Analysis of tax charge
+----------+--------+--------+--------+--------+--------+--------+---------+----------+
| | 2010 | 2009 |
| | GBP'000 | GBP'000 |
+----------------------------------------------------------------+---------+----------+
| Revenue | | | | | | | - | 73,844 |
| charge | | | | | | | | |
+----------+--------+--------+--------+--------+--------+--------+---------+----------+
| Credited | | | | | | | - | (73,844) |
| to | | | | | | | | |
| capital | | | | | | | | |
| return | | | | | | | | |
+----------+--------+--------+--------+--------+--------+--------+---------+----------+
| Current | | | | | | | - | - |
| and | | | | | | | | |
| total | | | | | | | | |
| tax | | | | | | | | |
| charge | | | | | | | | |
| (note | | | | | | | | |
| (b)) | | | | | | | | |
+----------+--------+--------+--------+--------+--------+--------+---------+----------+
b) Factors affecting tax charge for the year
+----------------+--------+--------+--------+--------+--------+--------+-------------+-----------+
| Total | | | | | | | (1,207,518) | (465,656) |
| return | | | | | | | | |
| on | | | | | | | | |
| ordinary | | | | | | | | |
| activities | | | | | | | | |
| before tax | | | | | | | | |
+----------------+--------+--------+--------+--------+--------+--------+-------------+-----------+
| Add: | | | | | | | (491,510) | 486,657 |
| unrealised | | | | | | | | |
| losses/(gains) | | | | | | | | |
+----------------+--------+--------+--------+--------+--------+--------+-------------+-----------+
| Less: | | | | | | | - | (180,364) |
| non-taxable | | | | | | | | |
| realised | | | | | | | | |
| gains | | | | | | | | |
+----------------+--------+--------+--------+--------+--------+--------+-------------+-----------+
| Add: | | | | | | | 619,881 | 512,431 |
| transaction | | | | | | | | |
| costs and | | | | | | | | |
| investment | | | | | | | | |
| management | | | | | | | | |
| expense | | | | | | | | |
| charged to | | | | | | | | |
| capital | | | | | | | | |
+----------------+--------+--------+--------+--------+--------+--------+-------------+-----------+
| Revenue | | | | | | | (1,079,147) | 353,068 |
| return | | | | | | | | |
| on | | | | | | | | |
| ordinary | | | | | | | | |
| activities | | | | | | | | |
| before | | | | | | | | |
| taxation | | | | | | | | |
+----------------+--------+--------+--------+--------+--------+--------+-------------+-----------+
| Corporation | | | | | | | - | 73,844 |
| tax at 21% | | | | | | | | |
| (2009: | | | | | | | | |
| 20.91%) | | | | | | | | |
+----------------+--------+--------+--------+--------+--------+--------+-------------+-----------+
| Taxation | | | | | | | - | 73,844 |
| on | | | | | | | | |
| revenue | | | | | | | | |
| return | | | | | | | | |
+----------------+--------+--------+--------+--------+--------+--------+-------------+-----------+
| | | | | | | | | |
+----------------+--------+--------+--------+--------+--------+--------+-------------+-----------+
| Allowable | | | | | | | 619,881 | 512,431 |
| expenditure | | | | | | | | |
| charged to | | | | | | | | |
| capital | | | | | | | | |
| return | | | | | | | | |
+----------------+--------+--------+--------+--------+--------+--------+-------------+-----------+
| Taxation | | | | | | | (130,175) | (107,175) |
| on | | | | | | | | |
| allowable | | | | | | | | |
| expenditure | | | | | | | | |
| charged to | | | | | | | | |
| capital | | | | | | | | |
| return | | | | | | | | |
+----------------+--------+--------+--------+--------+--------+--------+-------------+-----------+
| Unrelieved | | | | | | | 130,175 | 33,331 |
| expenses | | | | | | | | |
+----------------+--------+--------+--------+--------+--------+--------+-------------+-----------+
| Credited | | | | | | | - | (73,844) |
| to | | | | | | | | |
| capital | | | | | | | | |
| return | | | | | | | | |
+----------------+--------+--------+--------+--------+--------+--------+-------------+-----------+
| Tax | | | | | | | - | - |
| charge | | | | | | | | |
| for | | | | | | | | |
| year | | | | | | | | |
| (note | | | | | | | | |
| (a)) | | | | | | | | |
+----------------+--------+--------+--------+--------+--------+--------+-------------+-----------+
Tax relief relating to investment management fees is allocated between revenue
and capital where such relief can be utilised.
No asset or liability has been recognised for deferred tax in relation to
capital gains or losses on revaluing investments as the Company is exempt from
corporation tax in relation to capital gains or losses as a result of qualifying
as a venture capital trust.
There is no potential liability to deferred tax (2009: nil). There is an
unrecognised deferred tax asset of GBP130,175 (2009: GBP33,331).
The deferred tax asset relates to unutilised expenses.
7. Dividends Paid and Proposed
+--------------------------+--------+--------+--------+--------+--------+--------+---------+---------+
| | 2010 | 2009 |
| | GBP'000 | GBP'000 |
+--------------------------------------------------------------------------------+---------+---------+
| Amounts recognised as | | | | | | | 5,506 | 2,762 |
| distributions to equity | | | | | | | | |
| holders in the year | | | | | | | | |
+--------------------------+--------+--------+--------+--------+--------+--------+---------+---------+
| | | | | | | | | |
+--------------------------+--------+--------+--------+--------+--------+--------+---------+---------+
The final dividends per ordinary and D share, 64.8p and 7.0p respectively, in
respect of the year ended 28 February 2009 were approved at the annual general
meeting held on 29 June 2009. The record and payment dates for the ordinary
share dividend were 26 June 2009 and 30 June 2009; the record and payment dates
for the D share dividend were 13 November 2009 and 23 November 2009.
An interim dividend per ordinary share of 0.2p in respect of the year ended 28
February 2010 was paid in November 2009.
The Directors recommend final dividends of 7.0p per C share, 7.0p per D share
and 7.0p per E share to be paid on 12 November 2010 to all C shareholders, D
shareholders and E shareholders respectively on the register as at close of
business on 29 October 2010. The proposed final dividends are subject to
approval by the shareholders at the 2010 annual general meeting and have not
been included as a liability in these financial statements.
The total dividend payable in respect of the financial year is set out below.
+----------+--------+--------+--------+--------+--------+--------+---------+---------+
| | 2010 | 2009 |
| | GBP'000 | GBP'000 |
+----------------------------------------------------------------+---------+---------+
| Interim | | | | | | | 13 | 448 |
| dividend | | | | | | | | |
| - 0.2p | | | | | | | | |
| per | | | | | | | | |
| ordinary | | | | | | | | |
| share | | | | | | | | |
| (2009: | | | | | | | | |
| 7p) | | | | | | | | |
+----------+--------+--------+--------+--------+--------+--------+---------+---------+
| Proposed | | | | | | | 933 | - |
| final | | | | | | | | |
| dividend | | | | | | | | |
| - 7p per | | | | | | | | |
| C share | | | | | | | | |
| (2009: | | | | | | | | |
| nil) | | | | | | | | |
+----------+--------+--------+--------+--------+--------+--------+---------+---------+
| Proposed | | | | | | | 1,346 | 1,346 |
| final | | | | | | | | |
| dividend | | | | | | | | |
| - 7p per | | | | | | | | |
| D share | | | | | | | | |
| (2009: | | | | | | | | |
| 7p) | | | | | | | | |
+----------+--------+--------+--------+--------+--------+--------+---------+---------+
| Proposed | | | | | | | 687 | - |
| final | | | | | | | | |
| dividend | | | | | | | | |
| - 7p per | | | | | | | | |
| E share | | | | | | | | |
| (2009: | | | | | | | | |
| nil) | | | | | | | | |
+----------+--------+--------+--------+--------+--------+--------+---------+---------+
| Totals | | | | | | | 2,979 | 1,794 |
+----------+--------+--------+--------+--------+--------+--------+---------+---------+
8. Return per Share
+----------+--------+--------+---------+---------+---------+---------+---------+---------+
| | | | 2010 | 2009 |
+----------+--------+--------+-----------------------------+-----------------------------+
| | | | Revenue | Capital | Total | Revenue | Capital | Total |
+----------+--------+--------+---------+---------+---------+---------+---------+---------+
| Return | | | (0.90)p | (3.08)p | (3.98)p | (0.37)p | (2.14)p | (2.51)p |
| per | | | | | | | | |
| ordinary | | | | | | | | |
| share | | | | | | | | |
+----------+--------+--------+---------+---------+---------+---------+---------+---------+
| Return | | | (0.65)p | (2.36)p | (3.01)p | 1.55p | (4.34)p | (2.79)p |
| per C | | | | | | | | |
| share | | | | | | | | |
+----------+--------+--------+---------+---------+---------+---------+---------+---------+
| Return | | | (1.23)p | (0.79)p | (2.02)p | 0.55p | (0.16)p | 0.39p |
| per D | | | | | | | | |
| share | | | | | | | | |
+----------+--------+--------+---------+---------+---------+---------+---------+---------+
| Return | | | (1.24)p | (0.62)p | (1.86)p | - | - | - |
| per E | | | | | | | | |
| share | | | | | | | | |
+----------+--------+--------+---------+---------+---------+---------+---------+---------+
The ordinary shares were converted into deferred shares and then cancelled on 21
December 2009.
Basic revenue return per ordinary share is based on the net revenue loss from
ordinary activities after taxation of GBP(57,303) (2009: GBP(23,953)) and on
6,400,640 ordinary shares, being the weighted average number of shares in issue
during the period from 1 March 2009 to 21 December 2009. Basic capital return
per ordinary share is based on the net capital loss after taxation of
GBP(197,187) (2009: GBP(136,961)) and on 6,400,640 ordinary shares, being the
weighted average number of shares in issue during the period from 1 March 2009
to 21 December 2009.
Basic revenue return per C share is based on the net revenue loss (2009: profit)
from ordinary activities after taxation of GBP(86,903) (2009: GBP206,945) and on
13,328,599 C shares, being the weighted average number of shares in issue during
the period from 1 March 2009 to 28 February 2010. Basic capital return per C
share is based on the net capital loss after taxation of GBP(314,385) (2009:
GBP(579,161)) and on 13,328,599 C shares, being the weighted average number of
shares in issue during the period from 1 March 2009 to 28 February 2010.
Basic revenue return per D share is based on the net revenue loss (2009: profit)
from ordinary activities after taxation of GBP(235,400) (2009: GBP96,232) and on
19,228,838 D shares, being the weighted average number of shares in issue during
the period from 1 March 2009 to 28 February 2010. Basic capital return per D
share is based on the net capital loss after taxation of GBP(152,706) (2009:
GBP(28,759)) and on 19,228,838 D shares, being the weighted average number of
shares in issue during the period from 1 March 2009 to 28 February 2010.
Basic revenue return per E share is based on the net revenue loss from ordinary
activities after taxation of GBP(109,558) (2009: n/a) and on 8,806,980 E shares,
being the weighted average number of shares in issue during the period from 1
March 2009 to 28 February 2010. Basic capital return per E share is based on the
net capital loss after taxation of GBP(54,075) (2009: n/a) and on 8,806,980 E
shares, being the weighted average number of shares in issue during the period
from 1 March 2009 to 28 February 2010.
9. Investments
Movements in qualifying investments during the period are
summarised as follows:
+--------------------+--------+--------+--------+--------+--------+----------+---------+---------+
| | Venture | Venture | Total |
| | capital | capital | |
| | - | - | |
| | unquoted | quoted | |
+-----------------------------------------------------------------+----------+---------+---------+
| | | | | | | GBP'000 | GBP'000 | GBP'000 |
+--------------------+--------+--------+--------+--------+--------+----------+---------+---------+
| Book | | | | | | 7,011 | - | 7,011 |
| cost | | | | | | | | |
| at 28 | | | | | | | | |
| February | | | | | | | | |
| 2009 | | | | | | | | |
+--------------------+--------+--------+--------+--------+--------+----------+---------+---------+
| Unrealised | | | | | | (595) | - | (595) |
| gains/(losses) | | | | | | | | |
| at 28 February | | | | | | | | |
| 2009 | | | | | | | | |
+--------------------+--------+--------+--------+--------+--------+----------+---------+---------+
| Valuation | | | | | | 6,416 | - | 6,416 |
| at 28 | | | | | | | | |
| February | | | | | | | | |
| 2009 | | | | | | | | |
+--------------------+--------+--------+--------+--------+--------+----------+---------+---------+
| Movements | | | | | | | | |
| in the | | | | | | | | |
| year: | | | | | | | | |
+--------------------+--------+--------+--------+--------+--------+----------+---------+---------+
| - | | | | | | 8,830 | 250 | 9,080 |
| Purchases | | | | | | | | |
| at cost | | | | | | | | |
+--------------------+--------+--------+--------+--------+--------+----------+---------+---------+
| - | | | | | | (4,122) | - | (4,122) |
| Disposals-proceeds | | | | | | | | |
+--------------------+--------+--------+--------+--------+--------+----------+---------+---------+
| - Net | | | | | | (196) | - | (196) |
| realised | | | | | | | | |
| gains/(losses) | | | | | | | | |
+--------------------+--------+--------+--------+--------+--------+----------+---------+---------+
| Movement | | | | | | (61) | (39) | (100) |
| in | | | | | | | | |
| unrealised | | | | | | | | |
| gains/(losses) | | | | | | | | |
+--------------------+--------+--------+--------+--------+--------+----------+---------+---------+
| Valuation | | | | | | 10,867 | 211 | 11,078 |
| at 28 | | | | | | | | |
| February | | | | | | | | |
| 2010 | | | | | | | | |
+--------------------+--------+--------+--------+--------+--------+----------+---------+---------+
| | | | | | | | | |
+--------------------+--------+--------+--------+--------+--------+----------+---------+---------+
| Comprising: | | | | | | | | |
+--------------------+--------+--------+--------+--------+--------+----------+---------+---------+
| - Book | | | | | | 11,523 | 250 | 11,773 |
| cost | | | | | | | | |
| at 28 | | | | | | | | |
| February | | | | | | | | |
| 2010 | | | | | | | | |
+--------------------+--------+--------+--------+--------+--------+----------+---------+---------+
| - | | | | | | (656) | (39) | (695) |
| Unrealised | | | | | | | | |
| gains/(losses) | | | | | | | | |
| at 28 February | | | | | | | | |
| 2010 | | | | | | | | |
+--------------------+--------+--------+--------+--------+--------+----------+---------+---------+
| | | | | | | 10,867 | 211 | 11,078 |
+--------------------+--------+--------+--------+--------+--------+----------+---------+---------+
During the year, the Company incurred disposal transaction costs of GBPnil
(2009: GBPnil).
As at 28 February 2010, the Company had no intention to dispose of any of its
holdings.
The Company is required to report the category of fair value measurements used
in determining the value of its investments, to be disclosed by the source of
inputs, using a three-level hierarchy:
Quoted market prices in active markets - "Level 1"
Inputs to Level 1 fair values are quoted prices in active markets for identical
assets. An active market is one in which transactions occur with sufficient
frequency and volume to provide pricing information on an ongoing basis. The
Company's only investment classified in this category is Coolabi plc, an
AIM-traded company.
Valued using models with significant observable market parameters - "Level 2"
Inputs to Level 2 fair values are inputs other than quoted prices included
within Level 1 that are observable for the asset, either directly or indirectly.
The Company has no investments classified in this category.
Valued using models with significant unobservable market parameters - "Level 3"
Inputs to Level 3 fair values are unobservable inputs for the asset.
Unobservable inputs may have been used to measure fair value to the extent that
observable inputs are not available, thereby allowing for situations in which
there is little, if any, market activity for the asset at the measurement date
(or market information for the inputs to any valuation models). As such,
unobservable inputs reflect the assumptions the Company considers that market
participants would use in pricing the asset. The Company's unquoted equities and
loan stock are classified within this category. As explained in Note 1, unquoted
investments are valued in accordance with the International Private Equity and
Venture Capital Association guidelines.
10. Significant Interests
As at 28 February 2010, the Company held significant investments, amounting to
3% or more of the equity capital, in the following companies:
+-------------+--------+------------+-----------+------------+------------+
| Company | Equity | Loan | Total | Percentage |
| | | stock | investment | |
| | investment | GBP | GBP | of |
| | (ordinary | | | investee |
| | shares) | | | company's |
| | GBP | | | total |
| | | | | equity, |
| | | | | % |
+----------------------+------------+-----------+------------+------------+
| B & W | | 300,000 | 700,000 | 1,000,000 | 49.0 |
| Events | | | | | |
| Limited | | | | | |
+-------------+--------+------------+-----------+------------+------------+
| Challi | | 600,000 | 1,400,000 | 2,000,000 | 49.5 |
| Productions | | | | | |
| Limited | | | | | |
+-------------+--------+------------+-----------+------------+------------+
| HTM | | 600,000 | 1,400,000 | 2,000,000 | 49.5 |
| Promotions | | | | | |
| Limited | | | | | |
+-------------+--------+------------+-----------+------------+------------+
| Enrich | | 450,000 | 1,050,000 | 1,500,000 | 24.0 |
| Social | | | | | |
| Productions | | | | | |
| Limited | | | | | |
+-------------+--------+------------+-----------+------------+------------+
| MK | | 600,000 | 1,400,000 | 2,000,000 | 50.0 |
| Ultrasound | | | | | |
| Limited | | | | | |
+-------------+--------+------------+-----------+------------+------------+
| Saravid | | 600,000 | 1,400,000 | 2,000,000 | 49.5 |
| Promotions | | | | | |
| Limited | | | | | |
+-------------+--------+------------+-----------+------------+------------+
| TRP | | 600,000 | 1,400,000 | 2,000,000 | 50.0 |
| 2009 | | | | | |
| Limited | | | | | |
+-------------+--------+------------+-----------+------------+------------+
Total investment excludes investment costs of GBP18,733 across three
investments.
11. Debtors
+-------------+--------+--------+--------+--------+--------+--------+---------+---------+
| | 2010 | 2009 |
| | GBP'000 | GBP'000 |
+-------------------------------------------------------------------+---------+---------+
| Amounts | | | | | | | | |
| falling | | | | | | | | |
| due | | | | | | | | |
| within | | | | | | | | |
| one | | | | | | | | |
| year: | | | | | | | | |
+-------------+--------+--------+--------+--------+--------+--------+---------+---------+
| Accrued | | | | | | | 3 | 17 |
| interest | | | | | | | | |
| and | | | | | | | | |
| other | | | | | | | | |
| accrued | | | | | | | | |
| income | | | | | | | | |
+-------------+--------+--------+--------+--------+--------+--------+---------+---------+
| Amounts | | | | | | | 102 | 118 |
| due | | | | | | | | |
| from | | | | | | | | |
| the | | | | | | | | |
| Manager | | | | | | | | |
+-------------+--------+--------+--------+--------+--------+--------+---------+---------+
| Prepayments | | | | | | | 52 | 438 |
| and other | | | | | | | | |
| debtors | | | | | | | | |
+-------------+--------+--------+--------+--------+--------+--------+---------+---------+
| | | | | | | | 157 | 573 |
+-------------+--------+--------+--------+--------+--------+--------+---------+---------+
12. Creditors: Amounts Falling Due Within One Year
+-----------+--------+--------+--------+--------+--------+--------+---------+---------+
| | 2010 | 2009 |
| | GBP'000 | GBP'000 |
+-----------------------------------------------------------------+---------+---------+
| Sundry | | | | | | | 206 | 1,566 |
| creditors | | | | | | | | |
| and | | | | | | | | |
| accruals | | | | | | | | |
+-----------+--------+--------+--------+--------+--------+--------+---------+---------+
| Amounts | | | | | | | 35 | - |
| due to | | | | | | | | |
| the | | | | | | | | |
| Manager | | | | | | | | |
+-----------+--------+--------+--------+--------+--------+--------+---------+---------+
| | | | | | | | 241 | 1,566 |
+-----------+--------+--------+--------+--------+--------+--------+---------+---------+
Neither income tax nor national insurance contributions are payable in respect
of any director's remuneration so there is no sum for either cost in the
creditors' balance.
13. Called-up Share Capital
+-------------+--------+--------+--------+--------+--------+---------+---------+
| | 2010 | 2009 |
| | GBP'000 | GBP'000 |
+----------------------------------------------------------+---------+---------+
| Authorised: | | | | | | | |
+-------------+--------+--------+--------+--------+--------+---------+---------+
| 300,000,000 | | | | | | 30,000 | 30,000 |
| ordinary | | | | | | | |
| shares of | | | | | | | |
| 10p each | | | | | | | |
+-------------+--------+--------+--------+--------+--------+---------+---------+
| 25,000,000 | | | | | | 2,500 | 2,500 |
| C shares | | | | | | | |
| of 10p | | | | | | | |
| each | | | | | | | |
+-------------+--------+--------+--------+--------+--------+---------+---------+
| 60,000,000 | | | | | | 6,000 | 6,000 |
| D shares | | | | | | | |
| of 10p | | | | | | | |
| each | | | | | | | |
+-------------+--------+--------+--------+--------+--------+---------+---------+
| 50,000,000 | | | | | | 5,000 | 5,000 |
| E shares | | | | | | | |
| of 10p | | | | | | | |
| each | | | | | | | |
+-------------+--------+--------+--------+--------+--------+---------+---------+
| 60,000,000 | | | | | | 6,000 | - |
| F shares | | | | | | | |
| of 10p | | | | | | | |
| each | | | | | | | |
+-------------+--------+--------+--------+--------+--------+---------+---------+
| 80,000,000 | | | | | | 8,000 | 4,500 |
| Deferred | | | | | | | |
| shares of | | | | | | | |
| 10p each | | | | | | | |
| (2009: | | | | | | | |
| 45,000,000) | | | | | | | |
+-------------+--------+--------+--------+--------+--------+---------+---------+
| | | | | | | 57,500 | 48,000 |
+-------------+--------+--------+--------+--------+--------+---------+---------+
| Allotted, | | | | | | | |
| called-up | | | | | | | |
| and fully | | | | | | | |
| paid: | | | | | | | |
+-------------+--------+--------+--------+--------+--------+---------+---------+
| 13,328,599 | | | | | | 1,333 | 1,333 |
| C shares | | | | | | | |
| of 10p | | | | | | | |
| each | | | | | | | |
+-------------+--------+--------+--------+--------+--------+---------+---------+
| 19,228,838 | | | | | | 1,923 | 1,923 |
| D shares | | | | | | | |
| of 10p | | | | | | | |
| each | | | | | | | |
+-------------+--------+--------+--------+--------+--------+---------+---------+
| 9,813,732 | | | | | | 981 | - |
| E shares | | | | | | | |
| of 10p | | | | | | | |
| each | | | | | | | |
+-------------+--------+--------+--------+--------+--------+---------+---------+
| | | | | | | 4,237 | 3,896 |
+-------------+--------+--------+--------+--------+--------+---------+---------+
During the year, the Company issued 9,813,732 E shares at a price of GBP1 per
share.
14. Reserves
+----------------+---------+---------+------------+--------------+----------+---------+
| | Share | Special | Capital | Capital | Revenue | Total |
| | premium | reserve | reserve | reserve | reserves | GBP'000 |
| | GBP'000 | GBP'000 | (realised) | (unrealised) | GBP'000 | |
| | | | GBP'000 | GBP'000 | | |
+----------------+---------+---------+------------+--------------+----------+---------+
| At 1 | 45 | 30,045 | (525) | (538) | 168 | 29,195 |
| March | | | | | | |
| 2009 | | | | | | |
+----------------+---------+---------+------------+--------------+----------+---------+
| E | 8,735 | | | | | 8,735 |
| share | | | | | | |
| issue | | | | | | |
+----------------+---------+---------+------------+--------------+----------+---------+
| E | (545) | | | | | (545) |
| share | | | | | | |
| issue | | | | | | |
| expenses | | | | | | |
+----------------+---------+---------+------------+--------------+----------+---------+
| Cancellation | (8,190) | 8,190 | | | | - |
| of E share | | | | | | |
| premium | | | | | | |
| account | | | | | | |
+----------------+---------+---------+------------+--------------+----------+---------+
| Fee re | (10) | | | | (10) | |
| cancellation | | | | | | |
| of share | | | | | | |
| premium | | | | | | |
| account | | | | | | |
+----------------+---------+---------+------------+--------------+----------+---------+
| Fee re | | (8) | | | | (8) |
| O | | | | | | |
| share | | | | | | |
| conversion | | | | | | |
| & | | | | | | |
| cancellation | | | | | | |
+----------------+---------+---------+------------+--------------+----------+---------+
| Dividends | | (5,449) | | | (57) | (5,506) |
| paid/committed | | | | | | |
+----------------+---------+---------+------------+--------------+----------+---------+
| Adjustment | | | | | | |
| for | | | | | | |
| dividend | | | | | | |
| which was | | | | | | |
| a return | | | | | | |
+----------------+---------+---------+------------+--------------+----------+---------+
| of | | 87 | 540 | | 13 | 640 |
| capital | | | | | | |
| (O | | | | | | |
| share) | | | | | | |
+----------------+---------+---------+------------+--------------+----------+---------+
| Movement | | | (1,209) | 491 | (489) | (1,207) |
| in | | | | | | |
| reserves | | | | | | |
+----------------+---------+---------+------------+--------------+----------+---------+
| At 28 | 45 | 32,855 | (1,194) | (47) | (365) | 31,294 |
| February | | | | | | |
| 2010 | | | | | | |
+----------------+---------+---------+------------+--------------+----------+---------+
15. Net Asset Value per Share
The net asset values per share at the year end were as follows:
+----------+--------+--------+--------+----------+--------+----------+--------+
| | 2010 Net asset | 2009 Net asset |
| | values | values |
| | attributable | attributable |
+-------------------------------------+-------------------+-------------------+
| | Net | Net | Net | Net |
| | assets | assets | assets | assets |
| | | per | | per |
| | | share | | share |
+-------------------------------------+----------+--------+----------+--------+
| Ordinary | | | | - | - | GBP4.4m | 69.09p |
| shares | | | | | | | |
+----------+--------+--------+--------+----------+--------+----------+--------+
| C | | | | GBP10.1m | 75.80p | GBP10.5m | 78.81p |
| shares | | | | | | | |
+----------+--------+--------+--------+----------+--------+----------+--------+
| D | | | | GBP16.4m | 85.45p | GBP18.2m | 94.47p |
| shares | | | | | | | |
+----------+--------+--------+--------+----------+--------+----------+--------+
| E | | | | GBP9.0m | 91.68p | - | - |
| shares | | | | | | | |
+----------+--------+--------+--------+----------+--------+----------+--------+
Net asset value per share is based on net assets at the year end and on the
number of shares in each class in issue at the year end - C shares 13,328,599; D
shares 19,228,838 and E shares 9,813,732.
16. Reconciliation of Net Return before Taxation to Net Cash Outflow from
Operating Activities
+---------------------+--------+--------+--------+--------+--------+---------+---------+
| | 2010 | 2009 |
| | GBP'000 | GBP'000 |
+------------------------------------------------------------------+---------+---------+
| Net | | | | | | (1,207) | (466) |
| return | | | | | | | |
| before | | | | | | | |
| taxation | | | | | | | |
| for the | | | | | | | |
| year | | | | | | | |
+---------------------+--------+--------+--------+--------+--------+---------+---------+
| (Gains)/losses | | | | | | 98 | 306 |
| on investments | | | | | | | |
+---------------------+--------+--------+--------+--------+--------+---------+---------+
| Adjustment | | | | | | (91) | - |
| to return | | | | | | | |
| for | | | | | | | |
| non-operating | | | | | | | |
| income | | | | | | | |
+---------------------+--------+--------+--------+--------+--------+---------+---------+
| Adjustment | | | | | | 62 | - |
| to return | | | | | | | |
| for | | | | | | | |
| non-operating | | | | | | | |
| expenditure | | | | | | | |
+---------------------+--------+--------+--------+--------+--------+---------+---------+
| (Increase)/decrease | | | | | | 416 | (467) |
| in debtors | | | | | | | |
+---------------------+--------+--------+--------+--------+--------+---------+---------+
| Increase/(decrease) | | | | | | (1,325) | 1,441 |
| in creditors and | | | | | | | |
| accruals | | | | | | | |
+---------------------+--------+--------+--------+--------+--------+---------+---------+
| Adjustment | | | | | | (398) | 437 |
| to | | | | | | | |
| decrease | | | | | | | |
| in debtors | | | | | | | |
| for | | | | | | | |
| capital-related | | | | | | | |
| balances | | | | | | | |
+---------------------+--------+--------+--------+--------+--------+---------+---------+
| Adjustment | | | | | | 1,344 | (1,303) |
| to | | | | | | | |
| decrease | | | | | | | |
| in | | | | | | | |
| creditors | | | | | | | |
| for | | | | | | | |
| capital-related | | | | | | | |
| balances | | | | | | | |
+---------------------+--------+--------+--------+--------+--------+---------+---------+
| Net | | | | | | (1,101) | (52) |
| cash | | | | | | | |
| inflow/(outflow) | | | | | | | |
| from operating | | | | | | | |
| activities | | | | | | | |
+---------------------+--------+--------+--------+--------+--------+---------+---------+
17. Analysis of Changes in Net Funds
+-------------+--------+--------+--------+--------+---------+---------+---------+
| | Cash | Liquid | Total |
| | GBP'000 | funds | GBP'000 |
| | | GBP'000 | |
+-------------------------------------------------+---------+---------+---------+
| At 1 | | | | | 934 | 26,734 | 27,668 |
| March | | | | | | | |
| 2009 | | | | | | | |
+-------------+--------+--------+--------+--------+---------+---------+---------+
| Cash | | | | | (141) | (3,821) | (3,962) |
| flows | | | | | | | |
+-------------+--------+--------+--------+--------+---------+---------+---------+
| Unrealised | | | | | - | 831 | 831 |
| adjustments | | | | | | | |
| in fair | | | | | | | |
| value | | | | | | | |
+-------------+--------+--------+--------+--------+---------+---------+---------+
| At 28 | | | | | 793 | 23,744 | 24,537 |
| February | | | | | | | |
| 2010 | | | | | | | |
+-------------+--------+--------+--------+--------+---------+---------+---------+
18. Financial Instruments
The Company's financial instruments comprise:
> Equity, loan stock and corporate bonds
> Cash balances and liquid resources
Investments are made in a combination of equity and loans. Surplus funds are
held on bank deposit or in money market instruments. It is not the Company's
policy to trade in financial instruments or derivatives.
Fixed asset investments are valued at fair value. For quoted investments this is
bid price. In respect of unquoted investments, these are valued by the Directors
in accordance with current industry guidelines. Where no reliable fair value can
be estimated, unquoted investments are carried at cost subject to provision for
impairment where necessary. The fair value of all other financial assets and
liabilities is represented by their carrying value in the balance sheet.
The Company held the following categories of financial instruments, all of which
are included in the balance sheet at fair value, at 28 February 2010:
+-------------+--------+--------+--------+---------+---------+---------+---------+
| | 2010 | 2010 | 2009 | 2009 |
| | (Book | (Fair | (Book | (Fair |
| | value) | value) | value) | value) |
| | GBP'000 | GBP'000 | GBP'000 | GBP'000 |
+----------------------------------------+---------+---------+---------+---------+
| Assets | | | | | | | |
| at | | | | | | | |
| fair | | | | | | | |
| value | | | | | | | |
| through | | | | | | | |
| profit | | | | | | | |
| and | | | | | | | |
| loss | | | | | | | |
+-------------+--------+--------+--------+---------+---------+---------+---------+
| - | | | | 11,773 | 11,078 | 7,011 | 6,416 |
| Investment | | | | | | | |
| portfolio | | | | | | | |
+-------------+--------+--------+--------+---------+---------+---------+---------+
| - | | | | 22,977 | 23,744 | 26,677 | 26,734 |
| Current | | | | | | | |
| investments | | | | | | | |
+-------------+--------+--------+--------+---------+---------+---------+---------+
| - Cash | | | | 793 | 793 | 934 | 934 |
| at | | | | | | | |
| bank | | | | | | | |
+-------------+--------+--------+--------+---------+---------+---------+---------+
| | | | | | | | |
+-------------+--------+--------+--------+---------+---------+---------+---------+
| Loans | | | | | | | |
| and | | | | | | | |
| receivables | | | | | | | |
+-------------+--------+--------+--------+---------+---------+---------+---------+
| - | | | | 3 | 3 | 17 | 17 |
| Accrued | | | | | | | |
| income | | | | | | | |
+-------------+--------+--------+--------+---------+---------+---------+---------+
| - | | | | 154 | 154 | 556 | 556 |
| Other | | | | | | | |
| debtors | | | | | | | |
+-------------+--------+--------+--------+---------+---------+---------+---------+
| - | | | | (241) | (241) | (1,566) | (1,566) |
| Other | | | | | | | |
| creditors | | | | | | | |
+-------------+--------+--------+--------+---------+---------+---------+---------+
| | | | | 35,459 | 35,531 | 33,629 | 33,091 |
+-------------+--------+--------+--------+---------+---------+---------+---------+
Unquoted investments account for 98.1% of the investment portfolio by value
(2009: 100%). The investment portfolio has a 100% concentration of risk towards
small UK based, sterling denominated companies and represents 31.2% (2009:
19.4%) of net assets by value at the year-end.
Current investments are money market funds which represent 66.8% (2009: 80.8%)
of net assets by value at the year-end.
The main risks arising from the Company's financial instruments are credit risk,
market price risk, interest rate risk and liquidity risk. All assets and
liabilities are denominated in sterling, hence there is no currency risk.
Credit risk
Credit risk is managed by settling all transactions on the basis of delivery
against payment.
Market price risk
The Board manages the market risk inherent in the Company's portfolio by
maintaining an appropriate spread of market risk and by ensuring full and timely
access to relevant information from the Manager. The Board reviews investment
performance and financial results, as well as compliance with the Company's
investment objectives. The Board also seeks to ensure that an appropriate
proportion of the Company's portfolio is invested in cash and readily realisable
securities which are sufficient to meet any funding commitments which may arise.
The Company does not use derivative instruments to hedge against market risk.
The equity and fixed interest stocks of the Company's unquoted investee
companies are very seldom traded and, as such, their prices are more uncertain
than those of more frequently traded stocks. It is estimated that a 10% fall in
the carrying value of the Company's unquoted investments would reduce profit
before tax for the year by GBP1,086,702 and reduce the Company's net asset
values per C share and D share by 4.59p and 2.47p respectively.
Interest rate risk
Some of the Company's financial assets are interest bearing, some of which are
at fixed rates and some at variable. As a result, the Company is exposed to
interest rate risk due to fluctuations in prevailing levels of market interest
rates. The Board seeks to mitigate this risk through regular monitoring of the
Company's interest bearing investments. The Company does not use derivative
instruments to hedge against interest rate risk.
As at 28 February 2010, the Company's financial assets by value, excluding
short-term trade debtors and creditors as permitted by Financial Reporting
Standard 25 "Financial Instruments: Disclosure and Presentation", comprised:
+-------------+--------+--------+--------+--------+----------+----------+----------+
| Financial assets | GBP000 | % | Interest | Weighted | Weighted |
| | | | rate | average | |
| | | | | interest | average |
| | | | | rate | period |
| | | | | % | for |
| | | | | | which |
| | | | | | rate is |
| | | | | | fixed, |
| | | | | | years |
+-------------------------------+--------+--------+----------+----------+----------+
| Ordinary | | | 4,728 | 13.3 | n/a | n/a | n/a |
| shares | | | | | | | |
+-------------+--------+--------+--------+--------+----------+----------+----------+
| Loan | | | 6,350 | 17.8 | Floating | n/a | n/a |
| stock | | | | | | | |
| - | | | | | | | |
| variable | | | | | | | |
| rate | | | | | | | |
+-------------+--------+--------+--------+--------+----------+----------+----------+
| On-demand | | | 350 | 1.0 | Floating | n/a | n/a |
| loan | | | | | | | |
+-------------+--------+--------+--------+--------+----------+----------+----------+
| Corporate | | | 7,376 | 20.7 | Floating | n/a | n/a |
| bonds | | | | | | | |
+-------------+--------+--------+--------+--------+----------+----------+----------+
| Cash | | | 16,018 | 45.0 | Floating | n/a | n/a |
| equivalents | | | | | | | |
+-------------+--------+--------+--------+--------+----------+----------+----------+
| Bank | | | 793 | 2.2 | Floating | n/a | n/a |
| deposits | | | | | | | |
+-------------+--------+--------+--------+--------+----------+----------+----------+
| | | | 35,615 | 100.0 | | | |
+-------------+--------+--------+--------+--------+----------+----------+----------+
It is estimated that a one percentage point fall in interest rates would have
increased the loss before tax for the year of GBP1,207,000 to a loss before tax
for the year of GBP1,217,000. The risk from future fluctuations in interest rate
movements should be mitigated by the Company's intention to complete its
investment strategy and to hold a majority of its investments in instruments
which are not exposed to market interest rate changes.
Liquidity risk
The investments in equity and fixed interest stocks of unquoted companies that
the Company holds are not traded and thus are not readily realisable. At times
the Company may be unable to realise its investments at their carrying values
because of an absence of willing buyers. The Company's ability to sell
investments may also be constrained by the requirements set down for VCTs. To
counter such liquidity risk, sufficient cash and money market funds are held to
meet running costs and other commitments. The Company invests its surplus funds
in high quality liquidity funds which are all accessible on an immediate basis.
Management of capital
The Company's objectives when managing capital are to safeguard the Company's
ability to continue as a going concern, satisfy the relevant HMRC requirements
and provide at least adequate returns for shareholders.
As a VCT, the Company must have, and must continue to have, within three years
of raising its capital at least 70% by value of its investments in VCT
qualifying holdings which are a relatively high risk asset class of small UK
companies. In satisfying this requirement, the Company's capital management
scope is restricted. Subject to this restriction, the Company may adjust
dividends, return capital to shareholders, issue new shares or sell assets to
maintain the level of liquidity to remain a going concern.
19. Post Balance Sheet Events
Since 28 February 2010, the Company has:
> Completed four investments in April 2010, for a total of GBP4
million. Each investment was committed in the year under review and, in each
case, the Company has an option to make an additional investment towards the end
of 2010
> Closed the F share offer for subscription through which the Company
issued 29.6m F shares.
20. Geographical Analysis
The operations of the Company are wholly in the United Kingdom.
21. Contingencies, Guarantees and Financial Commitments
There were no contingencies, guarantees or financial commitments as at 28
February 2010.
22. Transactions with the Investment Manager
During the year ended 28 February 2010 (year ended 28 February 2009), the
Company incurred costs of GBP906,750 (GBP814,032) (exclusive of VAT) payable to
Edge Investment Management Limited, the Company's investment manager. This sum
comprised:
A net investment management fee of GBP669,693 (which comprised a gross fee of
GBP675,298 less a VAT recovery of GBP5,605 in respect of VAT incurred on
investment management fees) (GBP683,241)
An administration fee of GBP88,082 (GBP130,791)
An investment management performance fee in respect of the management of the O
share fund of GBP148,975 (GBPnil)
Details of the Manager's fee arrangements are given in Note 3.
2010 Annual General Meeting and Class Meetings
Notices of the annual general meeting and class meetings are set out on pages 44
to 53 of this report. The resolutions before the meetings are important.
It is the Board's opinion that all resolutions are in the best interests of
shareholders as a whole and the Board recommends that shareholders should vote
in favour of all resolutions. Any shareholder who is in any doubt as to what
action to take should consult an appropriate independent adviser authorised
under the Financial Services and Markets Act 2000. If you have sold or
transferred all your C, D, E or F shares in the Company, please forward this
document together with the forms of proxy to the purchaser, transferee,
stockbroker or other agent through whom the sale or transfer was effected, for
transmission to the purchaser or transferee.
2010 Annual General Meeting
The Company's fourth annual general meeting will be held at noon on 11 August
2010 at the offices of Howard Kennedy, 19 Cavendish Square, London. Notice of
the meeting is set out on pages 44 and 45 of this report.
The business of the meeting is outlined below.
Resolution 1 - Annual Report and Financial Statements
The Directors are required to present to the annual general meeting the Annual
Report and Financial Statements for the financial year ended 28 February 2010.
Resolution 2 - To declare a final dividend
A final dividend cannot exceed the amount recommended by the Directors and can
only be paid after the members at a general meeting have approved it. The
Directors recommend (i) a final dividend of 7p per share payable on 12 November
2010 to the holders of C shares registered at the close of business on 29
October 2010 which will bring the total dividend for the year to 7p per share,
(ii) a final dividend of 7p per share payable on 12 November 2010 to the holders
of D shares registered at the close of business on 29 October 2010 which will
bring the total dividend for the year to 7p per share and (iii) a final dividend
of 7p per share payable on 12 November 2010 to the holders of E shares
registered at the close of business on 29 October 2010 which will bring the
total dividend for the year to 7p per share.
Resolution 3 - Directors' Remuneration Report
Under Regulation 11 and Schedule 8 of the Large and Medium Sized Companies and
Groups (Accounts and Reports) Regulations 2008, the Company is required to
produce a Directors' Remuneration Report for each relevant financial year and to
seek shareholder approval for that report at the annual general meeting. The
Directors' Remuneration Report is on pages 19 and 20 of the Annual Report and
Financial Statements.
Resolutions 4 & 5 - Re-election of Directors
Julian Paul and Frank Presland retire by rotation in accordance with the
Company's Articles of Association and, being eligible, offer themselves for
re-election.
Resolution 6 - Re-appointment of the auditors
The Company is required to re-appoint auditors at each annual general meeting of
the Company to hold office until the next general meeting at which accounts are
presented. This resolution proposes that the Company's current auditors,
Scott-Moncrieff, be re-appointed as auditors of the Company.
Resolution 7 - Remuneration of the auditors
This resolution proposes that the Directors be authorised to set the auditors'
remuneration.
Resolution 8 - Renewal of Directors' authority to allot shares
By virtue of Section 551 of the Companies Act 2006, the Directors require the
authority of the shareholders of the Company to allot shares or other relevant
securities in the Company. This resolution authorises the Directors to make
allotments of up to an additional 203,017,394 shares (representing the balance
of the unissued C share, D share, E share, F share and Deferred share capital of
the Company as at the date of this report (being the latest practicable date
prior to the publication of this document). The existing authority will expire
at the forthcoming annual general meeting and, by proposing this resolution, the
Board seeks its renewal. This authority will be effective until the later of the
date of the annual general meeting of the Company to be held in 2011 and the
date which is 15 months after the date on which this resolution is passed
(unless the authority is previously revoked, varied or extended by the Company
in general meeting).
Resolution 9 - Disapplication of pre-emption rights
Resolution 9, which will be proposed as a special resolution, supplements the
Directors' authority to allot shares in the Company given to them at Resolution
8 by renewing their authority to disapply pre-emption rights in respect of their
authority to allot unissued shares of the Company up to an aggregate nominal
value of GBP20,301,739 which represents the balance of the unissued C share, D
share, E share, F share and Deferred share capital of the Company as at the date
of this report. This authority will be effective until the later of the date
of the annual general meeting of the Company to be held in 2011 and the date
which is 15 months after the date on which this resolution is passed (unless the
authority is previously revoked, varied or extended by the Company in general
meeting).
Resolution 10 - Purchase of shares by the Company
Resolution 10, which will be proposed as a special resolution, will, if passed,
authorise the Company for the purpose of section 701 of the Companies Act to
make one or more market purchases of C shares, D shares, E shares and F shares
provided that:
(i) such authority is limited to the purchase of 14.99% of the issued C
share capital, 14.99% of the issued D share capital, 14.99% of the issued E
share capital and 14.99% of the F share capital as at the date of the final
closing of the F share offer for subscription;
(ii) the maximum price (exclusive of expenses) which may be paid for such
C shares, D shares, E shares or F shares shall be an amount equal to 105% of the
average of the middle market quotations for such class of the Company's shares,
as derived from the daily Official List of the London Stock Exchange, for the
five business days immediately preceding the day on which the purchase is made;
(iii) the Company may make a contract to purchase its own C shares, D
shares, E shares or F shares under this authority prior to the expiry of this
authority, and the Company may make a purchase of its own C shares, D shares, E
shares or F shares in pursuance of any such contract;
and this power, unless previously varied, revoked or renewed shall
come to an end at the conclusion of the Company's 2011 annual general meeting
or, if later, on the expiry of 15 months from the date of the passing of the
Resolution.
Class Meetings
Class meetings of holders of C shares, D shares, E shares and F shares will also
be held on 11 August 2010 where the relevant resolutions referred to above will
be proposed.
Notice of Annual General Meeting
Notice is hereby given that the fourth annual general meeting of Edge
Performance VCT plc will be held at noon on 11 August 2010 at the offices of
Howard Kennedy, 19 Cavendish Square, London for the purpose of considering and,
if thought fit, passing the following Resolutions (of which, Resolutions 1 to 8
will be proposed as ordinary resolutions and Resolutions 9 and 10 will be
proposed as special resolutions).
Ordinary Resolutions
1. To receive and adopt the Directors' and the Independent Auditor's
Reports and the Company's financial statements for the year ended 28 February
2010.
2. To declare (i) a final dividend of 7p per C share, such dividend to
be paid on 12 November 2010 to all C shareholders on the Company's register of
members as at close of business on 29 October 2010, (ii) a final dividend of 7p
per D share, such dividend to be paid on 12 November 2010 to all D shareholders
on the Company's register of members as at close of business on 29 October 2010
and (iii) a final dividend of 7p per E share, such dividend to be paid on 12
November 2010 to all E shareholders on the Company's register of members as at
close of business on 29 October 2010.
3. To approve the Directors' Remuneration Report for the year ended 28
February 2010.
4. To re-elect Julian Paul who is retiring in accordance with Article
111 of the Company's Articles of Association and who, being eligible, offers
himself for re-election as a director of the Company.
5. To re-elect Frank Presland who is retiring in accordance with
Article 111 of the Company's Articles of Association and who, being eligible,
offers himself for re-election as a director of the Company.
6. To re-appoint Scott-Moncrieff as auditors of the Company to hold
office until the conclusion of the next general meeting at which accounts are
laid before the Company.
7. To authorise the Directors to fix the remuneration of the auditors.
Special Business
As Special Business, to consider and, if thought fit, to pass the following
Resolutions, Resolution 8 as an ordinary resolution and Resolutions 9 and 10 as
special resolutions of the Company:
8. (i) That the Directors be and are hereby generally and
unconditionally authorised in accordance with Section 551 of the Companies Act
2006 ("the Act") to exercise all the powers of the Company to allot relevant
securities (as defined in that section) up to an aggregate nominal amount of
GBP20,301,739 during the period commencing on the passing of this Resolution and
expiring on the later of the date of the annual general meeting of the Company
to be held in 2011 and the date which is 15 months after the date on which this
resolution is passed (unless the authority is previously revoked, varied or
extended by the Company in general meeting) but so that this authority shall
allow the Company to make before the expiry of this authority offers or
agreements which would or might require relevant securities to be allotted after
such expiry; and
(ii) That all previous authorities given to the Directors in
accordance with Section 551 of the Act be and they are hereby revoked, provided
that such revocation shall not have retrospective effect.
Special Resolutions
9. In substitution for any existing power under Section 570 of the Act,
but without prejudice to the exercise of any such power prior to the date
hereof, the Directors be and are hereby empowered pursuant to Section 570 and
573 of the Act during the period commencing on the passing of this Resolution
and expiring at the conclusion of the Company's 2011 annual general meeting, or
on the expiry of 15 months from the date of the passing of this Resolution,
whichever is the later (unless previously revoked, varied or extended by the
Company in general meeting pursuant to Section 570 of the Act) to allot equity
securities (as defined in Section 560(1) and 560(2) of the Act) for cash
pursuant to the authority given in accordance with Section 551 of the Act
pursuant to Resolution 8 above, as if Section 561(1) of the Act did not apply to
such allotment up to an aggregate nominal amount of GBP20,301,739 but so that
this authority shall allow the Company to make offers or agreements before the
expiry and the Directors may allot equity securities in pursuance of such offers
or agreements as if the powers conferred hereby had not so expired.
10. The Company be and is hereby generally and unconditionally authorised
for the purposes of Section 701 of the Act to make one or more market purchases
(within the meaning of Section 693 of the Act) of C shares, D shares, E shares
and F shares provided that:
(i) such authority is limited to the purchase of 14.99 per cent of the
issued C share capital, 14.99 per cent of the issued D share capital, 14.99 per
cent of the issued E share capital and 14.99 per cent of the issued F share
capital, in each case as immediately prior to the passing of this Resolution;
(ii) the minimum price which may be paid for such C shares, D shares, E
shares or F shares is 10p per share, the nominal amount of each such share;
(iii) the maximum price (exclusive of expenses) which may be paid for such
C shares, D shares, E shares or F shares shall be an amount equal to 105 per
cent of the average of the middle market quotations for such class of the
Company's shares, as derived from the daily Official List of the London Stock
Exchange, for the five business days immediately preceding the day on which the
purchase was made;
(iv) the Company may make a contract to purchase its own C shares, D
shares, E shares or F shares under this authority prior to the expiry of this
authority, and the Company may make a purchase of its own C shares, D shares, E
shares or F shares in pursuance of any such contract:
and this power, unless previously varied, revoked or renewed, shall come to an
end at the conclusion of the 2011 annual general meeting of the Company or, if
later, on the expiry of 15 months from the date of the passing of this
Resolution.
By order of the Board
The City Partnership (UK) Limited
Company Secretary
30 June 2010
Notes:
1. Only those Shareholders registered on the Company's register of
members at noon on 9 August 2010 or if this meeting is adjourned, at noon on the
day two days prior to the adjourned meeting, shall be entitled to attend and
vote at the meeting.
2. Information regarding the Meeting, including the information
required by section 311A of the Companies Act 2006, is available from
www.edge.uk.com/vct.
3. If you are a Shareholder of the Company at the time set out in note
1 above, you are entitled to appoint a proxy to exercise all or any of your
rights to attend, speak and vote at the meeting and you should have received a
Form of Proxy with this notice of meeting. You can only appoint a proxy using
the procedures set out in these notes and the notes to the Form of Proxy.
4. You may appoint more than one proxy provided each proxy is appointed
to exercise rights attached to different Shares. You may not appoint more than
one proxy to exercise rights attached to any one Share. To appoint more than one
proxy, contact Share Registrars Limited, Suite E, First Floor, 9 Lion and Lamb
Yard, Farnham, Surrey GU9 7LL.
5. To appoint a proxy, you must:
- send a completed hard copy of the Form of Proxy to Share Registrars
Limited, Suite E, First Floor, 9 Lion and Lamb Yard, Farnham, Surrey GU9 7LL; or
- send a legible scan of the completed hard copy of the Form of Proxy
to enquiries@shareregistrars.uk.com
For a proxy appointment to be valid, the hard copy or e-mailed
scan, as applicable, must be received as above, by no later than noon on 9
August 2010.
6. In order to revoke a proxy instruction you will need to inform the
Company using one of the following methods:
- By sending a signed hard copy notice, clearly stating your intention
to revoke your proxy appointment, to Share Registrars Limited, Suite E, First
Floor, 9 Lion and Lamb Yard, Farnham, Surrey GU9 7LL. In the case of a
Shareholder which is a company, the revocation notice must be executed under its
common seal or signed on its behalf by an officer of the company or an attorney
for the company. Any power of attorney or any other authority under which the
revocation notice is signed (or a duly certified copy of such power or
authority) must be included with the revocation notice.
- By sending an e-mail, clearly stating your intention to revoke your
proxy appointment, to enquiries@shareregistrars.uk.com.
In either case, the revocation notice must be received as above by
no later than noon on 9 August 2010. If you attempt to revoke your proxy
appointment but the revocation is received after the time specified then,
subject to the paragraph directly below, your proxy appointment will remain
valid.
7. Appointment of a proxy does not preclude you from attending the
meeting and voting in person. If you have appointed a proxy and attend the
meeting in person, your proxy appointment will automatically be terminated.
8. As at 30 June 2010, the Company's issued share capital comprised
13,328,599 C Shares, 19,228,838 D Shares, 9,813,732 E Shares and 29,611,437 F
Shares. Each C, D, E and F Share carries the right to one vote at a general
meeting of the Company and, therefore, the total number of voting rights in the
Company as at 30 June 2010 is 71,982,606.
9. Under section 319A of the Companies Act 2006, the Company must
answer any question you ask relating to the business being dealt with at the
meeting unless:
- answering the question would interfere unduly with the preparation
for the meeting or involve the disclosure of confidential information;
- the answer has already been given on a website in the form of an
answer to a question; or
- it is undesirable in the interests of the Company or the good order
of the meeting that the question be answered.
10. Except as provided above, Shareholders who have general queries about
the Meeting should use the following means of communication (no other methods of
communication will be accepted):
- by e-mail to info@edge.uk.com; or
- by post to Shareholder Relations, Edge Performance VCT plc, 1
Marylebone High Street, London W1U 4LX; or
- by telephone on 020 7317 1300.
11. You may not use any electronic address provided either in this notice
of general meeting, or any related documents (including the Form of Proxy), to
communicate with the Company for any purposes other than those expressly stated.
Notice of Class Meeting of Holders of C Shares
Notice is hereby given that a Class Meeting of holders of C shares in Edge
Performance VCT plc will be held at 12.15pm on 11 August 2010 at the offices of
Howard Kennedy, 19 Cavendish Square, London for the purpose of considering and,
if thought fit, passing Resolution 1 below as an ordinary resolution and
Resolution 2 below as a special resolution of the Company:
Ordinary Resolution
THAT:
1. The payment of a dividend of 7p per C share, such dividend to be
paid on 12 November 2010 to all those shareholders registered as holding C
shares on the register of members of the Company as at 29 October 2010, be and
is hereby approved.
Special Resolution
THAT:
2. The Company be and is hereby generally and unconditionally
authorised for the purposes of Section 701 of the Act to make one or more market
purchases (within the meaning of Section 693 of the Act) of C shares provided
that:
(i) such authority is limited to the purchase of 14.99 per cent of the
issued C share capital, immediately prior to the passing of this Resolution;
(ii) the minimum price which may be paid for such C shares is 10p per
share, the nominal amount of each such share;
(iii) the maximum price (exclusive of expenses) which may be paid for such
C shares, shall be an amount equal to 105 per cent of the average of the middle
market quotations for such class of the Company's shares, as derived from the
daily Official List of the London Stock Exchange, for the five business days
immediately preceding the day on which the purchase was made;
(iv) the Company may make a contract to purchase its own C shares under
this authority prior to the expiry of this authority, and the Company may make a
purchase of its own C shares in pursuance of any such contract;
and this power, unless previously varied, revoked or renewed, shall
come to an end at the conclusion of the 2011 annual general meeting of the
Company or, if later, on the expiry of 15 months from the date of the passing of
this Resolution.
By order of the Board
The City Partnership (UK) Limited
Company Secretary
30 June 2010
Notes:
1. Only those Shareholders registered on the Company's register of
members at 12.15pm on 9 August 2010 or if this meeting is adjourned, at 12.15pm
on the day two days prior to the adjourned meeting, shall be entitled to attend
and vote at the meeting.
2. Information regarding the Meeting, including the information
required by section 311A of the Companies Act 2006, is available from
www.edge.uk.com/vct.
3. If you are a Shareholder of the Company at the time set out in note
1 above, you are entitled to appoint a proxy to exercise all or any of your
rights to attend, speak and vote at the meeting and you should have received a
Form of Proxy with this notice of meeting. You can only appoint a proxy using
the procedures set out in these notes and the notes to the Form of Proxy.
4. You may appoint more than one proxy provided each proxy is appointed
to exercise rights attached to different Shares. You may not appoint more than
one proxy to exercise rights attached to any one Share. To appoint more than one
proxy, contact Share Registrars Limited, Suite E, First Floor, 9 Lion and Lamb
Yard, Farnham, Surrey GU9 7LL.
5. To appoint a proxy, you must:
- send a completed hard copy of the Form of Proxy to Share Registrars
Limited, Suite E, First Floor, 9 Lion and Lamb Yard, Farnham, Surrey GU9 7LL; or
- send a legible scan of the completed hard copy of the Form of Proxy
to enquiries@shareregistrars.uk.com
For a proxy appointment to be valid, the hard copy or e-mailed
scan, as applicable, must be received as above, by no later than 12.15pm on 9
August 2010.
6. In order to revoke a proxy instruction you will need to inform the
Company using one of the following methods:
- By sending a signed hard copy notice, clearly stating your intention
to revoke your proxy appointment, to Share Registrars Limited, Suite E, First
Floor, 9 Lion and Lamb Yard, Farnham, Surrey GU9 7LL. In the case of a
Shareholder which is a company, the revocation notice must be executed under its
common seal or signed on its behalf by an officer of the company or an attorney
for the company. Any power of attorney or any other authority under which the
revocation notice is signed (or a duly certified copy of such power or
authority) must be included with the revocation notice.
- By sending an e-mail, clearly stating your intention to revoke your
proxy appointment, to enquiries@shareregistrars.uk.com.
In either case, the revocation notice must be received as above by
no later than 12.15pm on 9 August 2010. If you attempt to revoke your proxy
appointment but the revocation is received after the time specified then,
subject to the paragraph directly below, your proxy appointment will remain
valid.
7. Appointment of a proxy does not preclude you from attending the
meeting and voting in person. If you have appointed a proxy and attend the
meeting in person, your proxy appointment will automatically be terminated.
8. As at 30 June 2010, the Company's issued share capital comprised
13,328,599 C Shares, 19,228,838 D Shares, 9,813,732 E Shares and 29,611,437 F
Shares. Each C, D, E and F Share carries the right to one vote at a general
meeting of the Company and, therefore, the total number of voting rights in the
Company as at 30 June 2010 is 71,982,606.
9. Under section 319A of the Companies Act 2006, the Company must
answer any question you ask relating to the business being dealt with at the
meeting unless:
- answering the question would interfere unduly with the preparation
for the meeting or involve the disclosure of confidential information;
- the answer has already been given on a website in the form of an
answer to a question; or
- it is undesirable in the interests of the Company or the good order
of the meeting that the question be answered.
10. Except as provided above, Shareholders who have general queries about
the Meeting should use the following means of communication (no other methods of
communication will be accepted):
- by e-mail to info@edge.uk.com; or
- by post to Shareholder Relations, Edge Performance VCT plc, 1
Marylebone High Street, London W1U 4LX; or
- by telephone on 020 7317 1300.
11. You may not use any electronic address provided either in this notice
of general meeting, or any related documents (including the Form of Proxy), to
communicate with the Company for any purposes other than those expressly stated.
Notice of Class Meeting of Holders of D Shares
Notice is hereby given that a Class Meeting of holders of D shares in Edge
Performance VCT plc will be held at 12.25pm on 11 August 2010 at the offices of
Howard Kennedy, 19 Cavendish Square, London for the purpose of considering and,
if thought fit, passing Resolution 1 below as an ordinary resolution and
Resolution 2 below as a special resolution of the Company:
Ordinary Resolution
THAT:
1. The payment of a dividend of 7p per D share, such dividend to be
paid on 12 November 2010 to all those shareholders registered as holding D
shares on the register of members of the Company as at 29 October 2010, be and
is hereby approved.
Special Resolution
THAT:
2. The Company be and is hereby generally and unconditionally
authorised for the purposes of Section 701 of the Act to make one or more market
purchases (within the meaning of Section 693 of the Act) of D shares provided
that:
(i) such authority is limited to the purchase of 14.99 per cent of the
issued D share capital, immediately prior to the passing of this Resolution;
(ii) the minimum price which may be paid for such D shares is 10p per
share, the nominal amount of each such share;
(iii) the maximum price (exclusive of expenses) which may be paid for such
D shares, shall be an amount equal to 105 per cent of the average of the middle
market quotations for such class of the Company's shares, as derived from the
daily Official List of the London Stock Exchange, for the five business days
immediately preceding the day on which the purchase was made;
(iv) the Company may make a contract to purchase its own D shares under
this authority prior to the expiry of this authority, and the Company may make a
purchase of its own D shares in pursuance of any such contract;
and this power, unless previously varied, revoked or renewed, shall come to an
end at the conclusion of the 2011 annual general meeting of the Company or, if
later, on the expiry of 15 months from the date of the passing of this
Resolution.
By order of the Board
The City Partnership (UK) Limited
Company Secretary
30 June 2010
Notes:
1. Only those Shareholders registered on the Company's register of
members at 12.25pm on 9 August 2010 or if this meeting is adjourned, at 12.25pm
on the day two days prior to the adjourned meeting, shall be entitled to attend
and vote at the meeting.
2. Information regarding the Meeting, including the information
required by section 311A of the Companies Act 2006, is available from
www.edge.uk.com/vct.
3. If you are a Shareholder of the Company at the time set out in note
1 above, you are entitled to appoint a proxy to exercise all or any of your
rights to attend, speak and vote at the meeting and you should have received a
Form of Proxy with this notice of meeting. You can only appoint a proxy using
the procedures set out in these notes and the notes to the Form of Proxy.
4. You may appoint more than one proxy provided each proxy is appointed
to exercise rights attached to different Shares. You may not appoint more than
one proxy to exercise rights attached to any one Share. To appoint more than one
proxy, contact Share Registrars Limited, Suite E, First Floor, 9 Lion and Lamb
Yard, Farnham, Surrey GU9 7LL.
5. To appoint a proxy, you must:
- send a completed hard copy of the Form of Proxy to Share Registrars
Limited, Suite E, First Floor, 9 Lion and Lamb Yard, Farnham, Surrey GU9 7LL; or
- send a legible scan of the completed hard copy of the Form of Proxy
to enquiries@shareregistrars.uk.com
For a proxy appointment to be valid, the hard copy or e-mailed
scan, as applicable, must be received as above, by no later than 12.25pm on 9
August 2010.
6. In order to revoke a proxy instruction you will need to inform the
Company using one of the following methods:
- By sending a signed hard copy notice, clearly stating your intention
to revoke your proxy appointment, to Share Registrars Limited, Suite E, First
Floor, 9 Lion and Lamb Yard, Farnham, Surrey GU9 7LL. In the case of a
Shareholder which is a company, the revocation notice must be executed under its
common seal or signed on its behalf by an officer of the company or an attorney
for the company. Any power of attorney or any other authority under which the
revocation notice is signed (or a duly certified copy of such power or
authority) must be included with the revocation notice.
- By sending an e-mail, clearly stating your intention to revoke your
proxy appointment, to enquiries@shareregistrars.uk.com.
In either case, the revocation notice must be received as above by
no later than 12.25pm on 9 August 2010. If you attempt to revoke your proxy
appointment but the revocation is received after the time specified then,
subject to the paragraph directly below, your proxy appointment will remain
valid.
7. Appointment of a proxy does not preclude you from attending the
meeting and voting in person. If you have appointed a proxy and attend the
meeting in person, your proxy appointment will automatically be terminated.
8. As at 30 June 2010, the Company's issued share capital comprised
13,328,599 C Shares, 19,228,838 D Shares, 9,813,732 E Shares and 29,611,437 F
Shares. Each C, D, E and F Share carries the right to one vote at a general
meeting of the Company and, therefore, the total number of voting rights in the
Company as at 30 June 2010 is 71,982,606.
9. Under section 319A of the Companies Act 2006, the Company must
answer any question you ask relating to the business being dealt with at the
meeting unless:
- answering the question would interfere unduly with the preparation
for the meeting or involve the disclosure of confidential information;
- the answer has already been given on a website in the form of an
answer to a question; or
- it is undesirable in the interests of the Company or the good order
of the meeting that the question be answered.
10. Except as provided above, Shareholders who have general queries about
the Meeting should use the following means of communication (no other methods of
communication will be accepted):
- by e-mail to info@edge.uk.com; or
- by post to Shareholder Relations, Edge Performance VCT plc, 1
Marylebone High Street, London W1U 4LX; or
- by telephone on 020 7317 1300.
11. You may not use any electronic address provided either in this notice
of general meeting, or any related documents (including the Form of Proxy), to
communicate with the Company for any purposes other than those expressly stated.
Notice of Class Meeting of Holders of E Shares
Notice is hereby given that a Class Meeting of holders of E shares in Edge
Performance VCT plc will be held at 12.35pm on 11 August 2010 at the offices of
Howard Kennedy, 19 Cavendish Square, London for the purpose of considering and,
if thought fit, passing Resolution 1 below as an ordinary resolution and
Resolution 2 below as a special resolution of the Company:
Ordinary Resolution
THAT:
1. The payment of a dividend of 7p per E share, such dividend to be
paid on 12 November 2010 to all those shareholders registered as holding E
shares on the register of members of the Company as at 29 October 2010, be and
is hereby approved.
Special Resolution
THAT:
2. The Company be and is hereby generally and unconditionally
authorised for the purposes of Section 701 of the Act to make one or more market
purchases (within the meaning of Section 693 of the Act) of E shares provided
that:
(i) such authority is limited to the purchase of 14.99 per cent of the
issued E share capital, immediately prior to the passing of this Resolution;
(ii) the minimum price which may be paid for such E shares is 10p per
share, the nominal amount of each such share;
(iii) the maximum price (exclusive of expenses) which may be paid for such
E shares, shall be an amount equal to 105 per cent of the average of the middle
market quotations for such class of the Company's shares, as derived from the
daily Official List of the London Stock Exchange, for the five business days
immediately preceding the day on which the purchase was made;
(iv) the Company may make a contract to purchase its own E shares under
this authority prior to the expiry of this authority, and the Company may make a
purchase of its own E shares in pursuance of any such contract;
and this power, unless previously varied, revoked or renewed, shall
come to an end at the conclusion of the 2011 annual general meeting of the
Company or, if later, on the expiry of 15 months from the date of the passing of
this Resolution.
By order of the Board
The City Partnership (UK) Limited
Company Secretary
30 June 2010
Notes:
1. Only those Shareholders registered on the Company's register of
members at 12.35pm on 9 August 2010 or if this meeting is adjourned, at 12.35pm
on the day two days prior to the adjourned meeting, shall be entitled to attend
and vote at the meeting.
2. Information regarding the Meeting, including the information
required by section 311A of the Companies Act 2006, is available from
www.edge.uk.com/vct.
3. If you are a Shareholder of the Company at the time set out in note
1 above, you are entitled to appoint a proxy to exercise all or any of your
rights to attend, speak and vote at the meeting and you should have received a
Form of Proxy with this notice of meeting. You can only appoint a proxy using
the procedures set out in these notes and the notes to the Form of Proxy.
4. You may appoint more than one proxy provided each proxy is appointed
to exercise rights attached to different Shares. You may not appoint more than
one proxy to exercise rights attached to any one Share. To appoint more than one
proxy, contact Share Registrars Limited, Suite E, First Floor, 9 Lion and Lamb
Yard, Farnham, Surrey GU9 7LL.
5. To appoint a proxy, you must:
- send a completed hard copy of the Form of Proxy to Share Registrars
Limited, Suite E, First Floor, 9 Lion and Lamb Yard, Farnham, Surrey GU9 7LL; or
- send a legible scan of the completed hard copy of the Form of Proxy
to enquiries@shareregistrars.uk.com
For a proxy appointment to be valid, the hard copy or e-mailed
scan, as applicable, must be received as above, by no later than 12.35pm on 9
August 2010.
6. In order to revoke a proxy instruction you will need to inform the
Company using one of the following methods:
- By sending a signed hard copy notice, clearly stating your intention
to revoke your proxy appointment, to Share Registrars Limited, Suite E, First
Floor, 9 Lion and Lamb Yard, Farnham, Surrey GU9 7LL. In the case of a
Shareholder which is a company, the revocation notice must be executed under its
common seal or signed on its behalf by an officer of the company or an attorney
for the company. Any power of attorney or any other authority under which the
revocation notice is signed (or a duly certified copy of such power or
authority) must be included with the revocation notice.
- By sending an e-mail, clearly stating your intention to revoke your
proxy appointment, to enquiries@shareregistrars.uk.com.
In either case, the revocation notice must be received as above by
no later than 12.35pm on 9 August 2010. If you attempt to revoke your proxy
appointment but the revocation is received after the time specified then,
subject to the paragraph directly below, your proxy appointment will remain
valid.
7. Appointment of a proxy does not preclude you from attending the
meeting and voting in person. If you have appointed a proxy and attend the
meeting in person, your proxy appointment will automatically be terminated.
8. As at 30 June 2010, the Company's issued share capital comprised
13,328,599 C Shares, 19,228,838 D Shares, 9,813,732 E Shares and 29,611,437 F
Shares. Each C, D, E and F Share carries the right to one vote at a general
meeting of the Company and, therefore, the total number of voting rights in the
Company as at 30 June 2010 is 71,982,606.
9. Under section 319A of the Companies Act 2006, the Company must
answer any question you ask relating to the business being dealt with at the
meeting unless:
- answering the question would interfere unduly with the preparation
for the meeting or involve the disclosure of confidential information;
- the answer has already been given on a website in the form of an
answer to a question; or
- it is undesirable in the interests of the Company or the good order
of the meeting that the question be answered.
10. Except as provided above, Shareholders who have general queries about
the Meeting should use the following means of communication (no other methods of
communication will be accepted):
- by e-mail to info@edge.uk.com; or
- by post to Shareholder Relations, Edge Performance VCT plc, 1
Marylebone High Street, London W1U 4LX; or
- by telephone on 020 7317 1300.
11. You may not use any electronic address provided either in this notice
of general meeting, or any related documents (including the Form of Proxy), to
communicate with the Company for any purposes other than those expressly stated.
Notice of Class Meeting of Holders of F Shares
Notice is hereby given that a Class Meeting of holders of F shares in Edge
Performance VCT plc will be held at 12.45pm on 11 August 2010 at the offices of
Howard Kennedy, 19 Cavendish Square, London for the purpose of considering and,
if thought fit, passing Resolution 1 below as a special resolution of the
Company:
Special Resolution
THAT:
1. The Company be and is hereby generally and unconditionally
authorised for the purposes of Section 701 of the Act to make one or more market
purchases (within the meaning of Section 693 of the Act) of F shares provided
that:
(i) such authority is limited to the purchase of 14.99 per cent of the
issued F share capital, immediately prior to the passing of this Resolution;
(ii) the minimum price which may be paid for such F shares is 10p per
share, the nominal amount of each such share;
(iii) the maximum price (exclusive of expenses) which may be paid for such
F shares, shall be an amount equal to 105 per cent of the average of the middle
market quotations for such class of the Company's shares, as derived from the
daily Official List of the London Stock Exchange, for the five business days
immediately preceding the day on which the purchase was made;
(iv) the Company may make a contract to purchase its own F shares under
this authority prior to the expiry of this authority, and the Company may make a
purchase of its own F shares in pursuance of any such contract;
and this power, unless previously varied, revoked or renewed, shall
come to an end at the conclusion of the 2011 annual general meeting of the
Company or, if later, on the expiry of 15 months from the date of the passing of
this Resolution.
By order of the Board
The City Partnership (UK) Limited
Company Secretary
30 June 2010
Notes:
1. Only those Shareholders registered on the Company's register of
members at 12.45pm on 9 August 2010 or if this meeting is adjourned, at 12.45pm
on the day two days prior to the adjourned meeting, shall be entitled to attend
and vote at the meeting.
2. Information regarding the Meeting, including the information
required by section 311A of the Companies Act 2006, is available from
www.edge.uk.com/vct.
3. If you are a Shareholder of the Company at the time set out in note
1 above, you are entitled to appoint a proxy to exercise all or any of your
rights to attend, speak and vote at the meeting and you should have received a
Form of Proxy with this notice of meeting. You can only appoint a proxy using
the procedures set out in these notes and the notes to the Form of Proxy.
4. You may appoint more than one proxy provided each proxy is appointed
to exercise rights attached to different Shares. You may not appoint more than
one proxy to exercise rights attached to any one Share. To appoint more than one
proxy, contact Share Registrars Limited, Suite E, First Floor, 9 Lion and Lamb
Yard, Farnham, Surrey GU9 7LL.
5. To appoint a proxy, you must:
- send a completed hard copy of the Form of Proxy to Share Registrars
Limited, Suite E, First Floor, 9 Lion and Lamb Yard, Farnham, Surrey GU9 7LL; or
- send a legible scan of the completed hard copy of the Form of Proxy
to enquiries@shareregistrars.uk.com
For a proxy appointment to be valid, the hard copy or e-mailed
scan, as applicable, must be received as above, by no later than 12.45pm on 9
August 2010.
6. In order to revoke a proxy instruction you will need to inform the
Company using one of the following methods:
- By sending a signed hard copy notice, clearly stating your intention
to revoke your proxy appointment, to Share Registrars Limited, Suite E, First
Floor, 9 Lion and Lamb Yard, Farnham, Surrey GU9 7LL. In the case of a
Shareholder which is a company, the revocation notice must be executed under its
common seal or signed on its behalf by an officer of the company or an attorney
for the company. Any power of attorney or any other authority under which the
revocation notice is signed (or a duly certified copy of such power or
authority) must be included with the revocation notice.
- By sending an e-mail, clearly stating your intention to revoke your
proxy appointment, to enquiries@shareregistrars.uk.com.
In either case, the revocation notice must be received as above by
no later than 12.45pm on 9 August 2010. If you attempt to revoke your proxy
appointment but the revocation is received after the time specified then,
subject to the paragraph directly below, your proxy appointment will remain
valid.
7. Appointment of a proxy does not preclude you from attending the
meeting and voting in person. If you have appointed a proxy and attend the
meeting in person, your proxy appointment will automatically be terminated.
8. As at 30 June 2010, the Company's issued share capital comprised
13,328,599 C Shares, 19,228,838 D Shares, 9,813,732 E Shares and 29,611,437 F
Shares. Each C, D, E and F Share carries the right to one vote at a general
meeting of the Company and, therefore, the total number of voting rights in the
Company as at 30 June 2010 is 71,982,606.
9. Under section 319A of the Companies Act 2006, the Company must
answer any question you ask relating to the business being dealt with at the
meeting unless:
- answering the question would interfere unduly with the preparation
for the meeting or involve the disclosure of confidential information;
- the answer has already been given on a website in the form of an
answer to a question; or
- it is undesirable in the interests of the Company or the good order
of the meeting that the question be answered.
10. Except as provided above, Shareholders who have general queries about
the Meeting should use the following means of communication (no other methods of
communication will be accepted):
- by e-mail to info@edge.uk.com; or
- by post to Shareholder Relations, Edge Performance VCT plc, 1
Marylebone High Street, London W1U 4LX; or
- by telephone on 020 7317 1300.
11. You may not use any electronic address provided either in this notice
of general meeting, or any related documents (including the Form of Proxy), to
communicate with the Company for any purposes other than those expressly stated.
Corporate Information
Directors
Sir Robin Miller (Chairman)
Michael Eaton
David Glick
Julian Paul FCA
Frank Presland
All of
1 Marylebone High Street
London W1U 4LZ
which is the registered
office of the Company
Investment Manager
Edge Investment Management Limited
1 Marylebone High Street
London W1U 4LZ
Company Secretary
The City Partnership (UK) Limited
Thistle House
21 Thistle Street
Edinburgh EH2 1DF
Promoter
RAM Capital Partners LLP
74 Chancery Lane
London WC2A 1AD
Taxation advisers
PricewaterhouseCoopers LLP
1 Embankment Place
London WC2N 6RH
Auditors
Scott-Moncrieff
Chartered Accountants
Exchange Place 3
Semple Street
Edinburgh
EH3 8BL
Bankers
HSBC Private Bank (UK) Limited
78 St. James's Street
London SW1A 1JB
Receiving Agent & Registrar
The City Partnership (UK) Limited
Thistle House
21 Thistle Street
Edinburgh EH2 1DF
This information is provided by RNS
The company news service from the London Stock Exchange
END
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