TIDMLEAD
Leadcom Integrated Solutions Ltd.
Proposed cancellation of admission to trading on AIM
of the Ordinary Shares
Notice of Extraordinary General Meeting
Hod Hasharon, Israel, May 28, 2009 - Leadcom Integrated Solutions Ltd., ("Leadcom", or the "Company", AIM: LEAD), a leading international provider of innovative telecommunication solutions, announces that it is today posting a circular to shareholders concerning the proposed Cancellation of admission to trading on AIM of the Ordinary Shares, as announced on 27 may 2009.
The Circular can be obtained fee of charge here: http://www.leadcom-is.com/IntegratedSolutions//1/52/1688.aspx
For the avoidance of doubt, the Company will be maintaining its listing on the Tel Aviv Stock Exchange.
Introduction
Under Rule 41 of the Aim Rules, the Cancellation is conditional upon the approval of not less than 75 per cent. of the votes cast by Shareholders (whether present in person or by proxy) at the EGM.
The EGM has been convened for 12 Noon (UK time) on 22 June 2009 at the Company's corporate offices in 4 Hacharash Street, Hod Hasharon, Israel.
Subject to the requisite Shareholder approval being received, the Cancellation is expected to be effective at 7.00 a.m. (UK time) on 30 June 2009.
Background to the Cancellation
On April 2005, the Company's Ordinary Shares were admitted to trading on AIM.
On December 2008, the Company listed its Ordinary Shares and its debentures for trading on TASE.
Pursuant to Rule 41 of the AIM Rules, the Directors have notified the London Stock Exchange of their intention to cancel (subject to the passing of the Resolution at the EGM) the admission of the Ordinary Shares to trading on AIM.
In making this decision the Directors have considered the ongoing expense of maintaining a quotation on both AIM and TASE and the current low volumes of trading in the Ordinary Shares on AIM.
As previously announced by the Company, due to the decline in the Company's business activity as a result of the global economic crisis and the recession in the telecommunications sector, the Company has taken numerous aggressive cost-cutting measures, including reducing payroll costs, effecting layoffs and lowering expenses in all of the Company's fields of operations, in order to facilitate a return of the Company to profitability and to minimise cash outflows.
The Company incurs significant expenses in relation to its quotation on AIM, including ongoing AIM fees, Nominated Adviser (NOMAD) fees, CREST fees, share register fees, and increased legal and accounting fees. In addition, the parallel listing of the Company's shares on AIM and TASE increases the complexity of the Company's regulatory obligations, which consumes management time and exposes the Company to conflicting regulatory provisions. The Directors estimate that by cancelling the admission to AIM the Company will save approximately GBP100,000 per annum.
Over the course of the last two years, the Company has suffered from a lack of institutional interest and wide spreads in the quoted share price, contributing to increasingly thin trading volumes on AIM.
Should the resolution be passed and the cancellation of admission to AIM occur, the Ordinary Shares will continue to be traded on TASE. The Directors believe that the Company's listing on TASE gives it adequate access to capital, both public and private, and also provides its shareholders with an alternative platform for liquidity. The Directors believe that TASE offers a more attractive platform for trading in the Company's shares, especially in light of their understanding that a majority of the Ordinary Shares have been transferred to Israel-based investors. Furthermore, since the listing of the Company's debentures on TASE, the debentures have been subject to active trading.
For further information about TASE in English, please refer to the TASE website at the following address: http://tase.co.il/TASEEng/homepage.htm.
The Directors therefore believe that, in light of the foregoing, it is in the best interests of the Shareholders to cancel the admission of the Company's shares to AIM, thereby significantly reducing the Company's costs and expenses as well as management time and attention, while at the same time maintaining an adequate access to capital and facilitating the marketability of the Ordinary Shares which will continue to be traded on TASE.
Following the Cancellation, the Ordinary Shares will not be quoted on a market in the UK and the Depository Interests will cease to be registered with CREST, however, the Ordinary Shares will continue to be traded on TASE.
The Company will take the following steps, in order to facilitate the continued trading of the Ordinary Shares on TASE by its current Shareholders:
1. The Company has reached an agreement with Harel Finance Trade & Securities Ltd. (http://www.harel-finance.co.il), one of the largest financial institutions in Israel, which has agreed to open brokerage accounts to facilitate the trading in the Company's Ordinary Shares on TASE.
2. The Company Secretary is available to assist Shareholders with registration and related issues. He can be reached at the following address: investorinfo@leadcom-is.com.
3. The Company will publish an extract of the Company's quarterly financial reports, as well as its principal announcements on TASE, in English on its website, for two years following the Cancellation.
4. The Company will constantly update a dedicated section on the investor relations section of its website pertaining to the facilities available to the holders of Ordinary Shares currently trading on AIM.
Until such time as the Shareholders whose shares were trading on AIM have been registered for trading on the TASE, the Shareholders will:
1. continue enjoying all the rights of Shareholders, including the right to receive notices of, and participate at, Shareholders' meetings, rights to receive dividends and any and all rights of Shareholders; and
2. be able to sell shares through private sale, though not on an exchange.
The Directors expect the Cancellation to result in considerable cost savings for the Company.The Cancellation will, however, result in Shareholders not having certain protections afforded by the AIM Rules, which are not incorporated in the rules of TASE or Israeli law, such as the AIM requirement for the prior approval of shareholders for any disposal resulting in a fundamental change of business and any reverse take-over.
The Directors believe that it is in the best interests of Shareholders to approve the Cancellation. The Company has, therefore, separately notified the London Stock Exchange of the Cancellation. The Cancellation is conditional upon the approval of the Resolution by the Shareholders, subject to the requisite Shareholder approval being received, cancellation is expected to be effective at 7.00 am (UK time) on 30 June 2009.
EGM
Attached to this release is a circular to our Shareholders, convening the EGM, to be held at 12 Noon (UK time) on 22 June 2009 at the offices of Leadcom Integrated Solutions Ltd., at 4 Hacharash Street (10th floor), Hod Hasharon, Israel.
At this meeting, the Resolution will be proposed as a special resolution.
To be effective, the Resolution requires the approval of not less than 75 per cent. of the votes cast by Shareholders (whether present in person or by proxy) at the EGM.
If the Resolution is passed at the EGM, it is anticipated that the Cancellation will become effective at 7.00 am (UK time) on 30 June 2009.
Recommendation
The Directors consider that the proposed Resolution is in the best interests of the Company and its Shareholders as a whole.Accordingly, the Directors unanimously recommend that Shareholders vote in favour of the Resolution to be proposed at the EGM.
Enquiries:
Mr. Ron Belkine General Counsel & Company Secretary - Leadcom Integrated Solutions Ltd
Tel: +972-9-7690120, ronb@leadcom-is.com
Expected timetable of principle events
Publication date of this circular 28 May 2009
Determining date for the purpose of 17 June 2009
eligibility to vote at the EGM
Latest time and date for receipt 12 Noon (UK time) on 18 June 2009
of Forms of Direction
Latest time and date for receipt 12 Noon (UK time) on 21 June 2009
of Forms of Proxy
EGM 12 Noon (UK time) on 22 June 2009
Cancellation of admission to trading with effect from 7.00
on AIM of the Ordinary Shares a.m. (UK time) on
30 June 2009
Definitions
"AIM" AIM, the market operated by the
London Stock Exchange plc
"AIM Rules" The London Stock Exchange
AIM Rules for Companies
"Cancellation" The proposed cancellation of admission to
trading on AIM of the Ordinary Shares
"Company" or "Leadcom" Leadcom Integrated Solutions Ltd.
"Depositary Interests" depositary interests derived
from the Ordinary Shares
"Directors" or "Board" the board of directors of Leadcom
"EGM" the extraordinary general meeting
of the Company convened for 12
Noon (UK time) on 22 June 2009
and any adjournment thereof
"Harel Finance" Harel Finance Trade & Securities Ltd.
"Ordinary Shares" fully paid ordinary shares of par
value NIS 0.001 per share of
the Company, and "Ordinary Share"
means any one of them
"Resolution" the resolution set out in the Notice
of EGM relating to the Cancellation
"Shareholders" holders of the Ordinary Shares and "Shareholder"
means any one of them
"TASE" Tel Aviv Stock Exchange
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