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Registered Number: 04247815 |
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BALANCE SHEET AT 31/10/2014 |
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CURRENT ASSETS | | | | | | | | | | |
Cash at bank and in hand | | | | 46,884 | | | | 49,884 | | |
| | | | 46,884 | | | | 49,884 | | |
CREDITORS: Amounts falling due within one year | | | | 1,221,812 | | | | 1,141,663 | | |
NET CURRENT LIABILITIES | | | | | | (1,174,928) | | | | (1,091,779) |
TOTAL ASSETS LESS CURRENT LIABILITIES | | | | | | (1,174,928) | | | | (1,091,779) |
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CREDITORS: Amounts falling due after more than one year | | 2 | | | | 5,977,610 | | | | 6,696,027 |
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NET LIABILITIES | | | | | | (7,152,538) | | | | (7,787,806) |
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CAPITAL AND RESERVES | | | | | | | | | | |
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Called up share capital | | 3 | | | | 2,640,519 | | | | 2,640,519 |
Share premium account | | | | | | 2,890,013 | | | | 2,890,013 |
Profit and loss account | | | | | | (12,683,070) | | | | (13,318,338) |
SHAREHOLDERS' FUNDS | | | | | | (7,152,538) | | | | (7,787,806) |
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For the year ending 31/10/2014 the company was entitled to exemption under section 477 of the Companies Act 2006 relating to small companies. |
The members have not required the company to obtain an audit in accordance with section 476 of the Companies Act 2006. |
The directors acknowledge their responsibilities for complying with the requirements of the Act with respect to accounting records and the preparation of accounts. |
These accounts have been prepared in accordance with the provisions applicable to companies subject to the small companies regime. |
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Approved by the board on 25/06/2015 and signed on their behalf by | | | | | | | | | | |
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G J Robeson | | | | | | | | | | |
Director | | | | | | | | | | |
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1b. Going Concern |
At 31 October 2014, the company had net liabilities of £7,152,538. The directors believe that loan note holders will not seek repayment of the amounts outstanding included within creditors due after one year of £5,977,610 before the repayment date. The loan notes are due for repayment on 7 October 2015. |
The company is further financed by a loan facility from a related party (see note 8). The directors believe that the facility will remain in place until 31 July 2015 and repayment will not be sought unless cash resources permit. |
The company has prepared cash flow forecasts for the twelve month period from the date of approval of these financial statements. After making appropriate enquiries, the directors believe that there is a reasonable expectation that the company has adequate resources to continue in operational existence for the foreseeable future and will be able to seek deferment of the loans. For this reason, the directors continue to adopt the going concern basis in preparing the financial statements. |
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2.
CREDITORS: AMOUNTS FALLING DUE AFTER MORE THAN ONE YEAR | | | | | | |
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Convertible loan notes | | | | 5,977,610 | | 6,696,027 |
| | | | 5,977,610 | | 6,696,027 |
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On 7 October 2005, the company issued £6,450,000 of loan notes at par to settle existing debts. These loan notes are convertible at 0.1p for each ordinary share in the company at the loan note holder's option. £500,000 of these loan notes bear interest at 5% per annum and the remaining loan notes of £5,959,000 are non-interest bearing. Both loan notes were repayable on 7 October 2012, however the directors have renegotiated the terms to 7 October 2015. On 13 September 2010, £1,200,000 of the loan notes were converted into 1,200,000,000 ordinary shares of £0.001 each, on the basis of 1,000 ordinary shares for each £1 of loan notes converted, as noted above. £4,750,000 of these loan notes are secured by a charge on the company's assets and the remainder are unsecured. |
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4. RELATED PARTY
TRANSACTIONS |
Kaloshar Limited Included in creditors as at 31 October 2014 are amounts owed to Kaloshar Limited of £5,930,394 (2013: £5,872,830). In view of the size of this debt, the directors believe that transactions with Kaloshar Limited and its related parties should be disclosed as related party transactions. Kaloshar limited is controlled by The Rowland Purpose Trust 2001. These transactions are explained below. On 7 October 2005, the company issued convertible loan notes at par totalling £7,200,000 to replace the existing loan due to Kaloshar Limited. These loan notes are convertible at 0.1p share at the option of the note holder and are redeemable as follows: i) £750,000 - original redemption date 7 October 2007, extended to 7 October 2015, however the note holder has confirmed they will not seek repayment before 30 June 2016, bearing interest at 5% per annum; ii) £500,000 - redemption date 7 October 2012, extended to 7 October 2015 and bearing interest at 5% per annum; and During 2010, £1,200,000 of the £5,950,000 non-interest bearing loan note issued to Kaloshar Limited was converted into 1,200,000,000 ordinary shares of 0.1p each, on the basis of 1,000 ordinary shares for each £1 of loan notes converted, as set out in the terms of the loan notes issued. During the current year, interest accrued on these loan notes of £57,565 (2013: £54,757) to Kaloshar Limited and at 31 October 2014 the company owed Kaloshar Limited £5,930,394 (2013: £5,872,830)
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Mr Leo Knifton, Mr Jonathan Rowland, Caldicot Management Limited On 7 October 2005, the 5% convertible loan note for £500,000 was assigned to Mr Leo Knifton and Mr Jonathan Rowland, who were both directors of Adeste Management Services Limited at the time. On the same date, the company issued 5% convertible loan notes at par to replace cash advances made by Caldicot Management Limited (£30,000), Mr Leo Knifton (£10,000) and Mr Jonathan Rowland (£10,000). During the current year, interest accrued on these loan notes of £19,896 (2013: £18,929) to Mr Leo Knifton, £19,896 (2013: £18,929) to Mr Jonathan Rowland and £2,303 (2013: £2,190) to Caldicot Management Limited. Following negotiation by the company, the loan notes assigned to Mr Leo Knifton and Mr Jonathan Rowland were written off . At 31 October 2014 the company owed Caldicot Management Limited £47,216 (2013: £44,913).
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Lawgra (No.365) Limited On 28 September 2005, the company entered into a loan facility of £300,000 with Lawgra (No.365) Limited to meet its liabilities as they fall due. This has subsequently increased to £1.2 million and been extended until 31 July 2015. The company will be negotiating new terms to extend the facility. The loan facility is unsecured and repayable on demand; interest accrues on the outstanding balance at 5% per annum. During the year, the accrued interest on the loan was £58,530 (2013: £55,676). Included in creditors as at 31 October 2014 are amounts due to Lawgra (No.365) Limited of £1,200,193 (2013: £1,141,663). Graham Robeson is a director of Lawgra (No.365) Limited, which is controlled by The Rowland Purpose Trust 2001.
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