PCEF Workshop 1

• - Application to re-regsiter as a public company
• - Application for admission to listing
• - Application for admission to trading

LR 2.2.3R and s75(1) FSMA 2000

• If a company is seeking admission to trading they need to comply with the listing rules because:
• s75(4)(a) FSMA 2000 - the competent authority may not grant an application for listing unless it is satisfied that the listing rules are complied with.

• Companies Act ss90-96 including:
• - SPECIAL RESOLUTION -Passing a special resolution
• - APPLICATION - Filing an application with Companies House in the approved form
• - ALLOTTED SHARE CAPITAL - Have an allotted share capital with a nominal value of not less than £50 000
• - AUDITORS' STATEMENT - File an auditors' statement showing that at the balance sheet date the amount of the company's net assets was not less than the amount of its called-up share capital and undistributable reserves.
• - CHANGE NAME - Change its name so that it states the company is to be a public limited company.

• PUBLIC COMPANY:
• - At least 25% of nominal value AND
• - WHOLE of any premium
• Must be paid (s91(1)(b) CA 2006)

• LISTED COMPANY:
• - Shares must all be fully paid (LR 2.2.4R)

• NO
• All listed companies are public companies (private companies cannot listed securities (Reg. 3, FSMA 2000 (Official Listing of Securities) Regulations 2001)) but not all public companies are listed companies.

Public company (s4(2) CA 2006) - certificate of incorporation states it is a public company and it has complied with CA 2006 re-registration requirements.

Listed company - Must be admitted to the official list and admitted to trading

YES it is a 'recognised investment exchange' (s285 FSMA 2000). It is therefore exempt from the general prohibition as regards regulated activities which are carried on as part of the Exchange's business.

TRUE (LR 2.2.3)

NB: The only recognised investment echange on this course is the London Stock Exchange Main Market (not AIM)

25% (Listing Rule 6.1.19R)

Definition of 'in the public hands' depends on circumstances. There is discretion to accept a lower percentage if satisfied that the market will operate properly as such a level (LR 6.1.20G)

A placing and an offer for sale

• - An offer for subscription
• - An intermediaries offer

An 'offer for sale' is where existing shareholders in the company sell their shares as part of the flotation and receive the proceeds themselves.

An 'introduction' is a method of bringing securities to listing involving the admission of shares already in issue (sometimes used by overseas companies with an existing listing on a foreign exchange and seeking a 'dual listing' in London forexample)

A rights issue

A rights issue is a form of 'secondary offer' involving an offer of shares or other securities to existing holders made in proportion to their existing holdings using a renounceable lettter of allotment (or other negotiable instrument) and usually at a discount to the market price.