Termination of Management Agreement
November 30 2009 - 12:59PM
UK Regulatory
TIDMRTY
RNS Number : 3440D
Rutley European Property Limited
30 November 2009
30 November 2009
RUTLEY EUROPEAN PROPERTY LIMITED
Termination of Management Agreement
The board of directors of Rutley European Property Limited (the "Company")
announces that it has today terminated the management agreement between the
Company and Rutley Capital Partners LLP ("RCP"), a wholly owned subsidiary of
Knight Frank LLP, (the "Existing Management Agreement") with effect from 30
November 2009. Following the serving of protective notice by the Company on 5
March 2009, the Existing Management Agreement was due to expire on 15 March
2010.
Black Sea Global Properties Limited ("BSGP") made a recommended public offer for
the Company earlier this year and ultimately acquired 73.5 per cent. of the
Company's shares. BSGP stated in its offer document that one of its objectives,
should its offer succeed, was to internalise the management of the Company.
Under the agreement to terminate the Existing Management Agreement entered into
earlier today ( the "Termination Agreement"), GBP544,000 will be paid by the
Company to RCP in respect of management fees for services that have been
provided by RCP but not yet paid for by the Company. This amount has been
calculated in accordance with the terms of the Existing Management Agreement. An
additional GBP106,000 will be paid by the Company in respect of an assignment
from RCP to the Company of intellectual property rights to various materials
that relate to the Company.
Certain employees of Knight Frank LLP who are currently providing services to
the Company under the Existing Management Agreement will be transferred to a
newly incorporated wholly owned subsidiary of the Company, Rutley European
Property Management Limited, which will employ the employees on the same terms
and conditions as their current employment contracts.
Under the Termination Agreement, it has also been agreed that Knight Frank
LLP will be a preferred service supplier to the Company in certain jurisdictions
from the date of the Termination Agreement until 30 November 2011. Knight Frank
LLP will be retained to provide such services at market rates for such services.
As part of the internalisation of the management arrangements, the carried
interest shares currently held on behalf of the management and employees of
Knight Frank LLP have been acquired by a wholly owned subsidiary of the Company
for a nominal consideration. From 1 April 2010 the Company will no longer have
the right to use the "Rutley" name and trade mark.
The Termination Agreement is not a related party transaction for the purposes of
Chapter 11 of the Listing Rules of the UK Listing Authority.
David Pinckney, Chairman of Rutley European Property Limited, commented:
"We are pleased to have reached agreement with Knight Frank to internalise the
Company's management. We believe that this move, which fulfills a commitment
made by BSGP in its offer document, better aligns the interests of management
and shareholders."
Enquiries:
+----------------------------------------------+----+----------------------+
| Rutley European Property Limited | | +44 (0) 20 7659 7495 |
| David Pinckney, Chairman | | |
+----------------------------------------------+----+----------------------+
| Lazard & Co., Limited | | +44 (0) 20 7187 2000 |
| Patrick Long | | |
| Michael Bressler | | |
+----------------------------------------------+----+----------------------+
| Oriel Securities Limited | | +44 (0) 20 7710 7600 |
| Tom Durie | | |
| Sapna Shah | | |
+----------------------------------------------+----+----------------------+
This information is provided by RNS
The company news service from the London Stock Exchange
END
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