Cardiff City EGM

As a shareholder - very small number of shares - I received my papers for the EGM before Christmas. I broadly agree with what has been written on MIke Morris's website about what is being proposed, but let me outline my understanding here.

The club is issuing new shares to buy out Sam Hammam's stake. These will raise £6.5million. Peter Ridsdale is buying £500,000 worth of new shares. £2.7 million has been promised to the club's financial advisers Seymour Pierce already for other shares. The club will be able to trade solvently on the basis of these funds.

Existing shareholders, now including Sam Hammam, have made irrevocable undertakings to vote in favour of the new reosolutions which will reorganise the shareholdings, reducing the stakes of existing shareholders, in part because they curently have a negative asset value. Existing shares will essentially be worth 1/10 of a new share. The authories share capital will be increased to £9.6 million.

Shareholders will not be allowed to transfer shares without the permission of the Board. If shareholders owning 50% or more of the shares agree to sell to another person, they can compel all other shareholders to do so.

The Langston Loan Notes - subject of so much mystery over the last few years - will be repaid from the naming rights - up to £9million - and from any new income coming in as a result of the new stadium or Premiership status. Interest will be waived by Langston until after the Stadium Project turns unconditional. The balance of the Loan Notes will have to be paid by 31 December 2016.

15,000,000 new shares are likely to be unissued initially and can be sold for cash to existing shareholders.

Now, I am still not clear myself where that leaves us with regard to the proposals that were outlined in October.

I went to the last AGM, held in September 2005, but I won't be able to go to this EGM. I will send in my proxy and I will support the deal. I think Peter Ridsdale has clearly taken the club forward, as well as the stadium development, and seems to have the confidence of the manager and the Council.

Questions I would ask if I were going:

- what is the situation with the original announcements in October about cash injections into the club relating to the clearing of the Loan Notes and money for players - plans appear to have changed since then?
- will the same amounts of money be available?
- are hedge funds still the likely investors?
- will ordinary shareholders - ie the likes of you and me - be able to buy shares in the club?

Anyone going who can get those answers, let me know.