Wellington Capital PIF/Octaviar (MFS) PIF

[Janiss]

I have this site set as my home page so I can keep up with the latest happenings, so while I don't post often I am a regular user. I'm really looking forward to meeting everyone at the EGM, especially you, Seamisty.
A million thanks to all involved in the PIFAG who have made this event possible and given us all hope that there's a bright light at the end of the long dark tunnel.

 

[ASICK]

http://castlereagh.rlbrandmgmt.com.au/include/tiny_mce/plugins/filemanager/files/Annexure_1_-_Extracts_for_Notice_of_Meeting.pdf

Your fund's constitution, Clause 23.3:
"... In the event that Wellington Capital Limited is appointed as Responsible Entity to the Scheme and is subsequently removed without its consent for any reason other than negligence or fraud, Wellington Capital Limited will be entitled to receive payment of removal fee of 2% of the gross value of the Scheme (as determined in the most recent audited accounts) which fee is payable immediately prior to replacement of Wellington Capital Limited as Responsible Entity of the Scheme. This fee will only be payable on removal of Wellington Capital Limited as Responsible Entity of the Scheme and may not otherwise be claimed by Wellington Capital Limited in any other circumstances. ..."

Also see Clauses 23.4.1 - 23.4.5

I hope you guys have got some really good legal advice. As I understand it, the abovereferenced clause is entrenched, that is, it's payable immediately prior to the present manager being ousted - it's set there for a specific reason - to protect the fee.

There's no doubt it's a timing thing, but I somehow think that you can't negate the payment to Wellington Capital by the removal of those clauses on the same day as ousting the manager.

I would have thought that members should be given a legal opinion about this issue.

I also think if the issues (fee / ousting of manager) aren't separated in (legal) time, legal action by the present manager (if ousted) will follow as night follows day.

I would have thought you'd have to bring two meetings - the first to amend the constitution, and the next day, a meeting to remove the manager. Maybe one in the morning, and another meeting in the afternoon?

Is there a reason to have a "$5m - better safe than sorry' extra meeting?

 

[seamisty]

New NSX announcement http://www.nsxa.com.au/ftp/news/021724028.PDF

Non-Renounceable Rights Issue – Section 1012DAA Notice
Wellington Capital Limited (Wellington) as Responsible Entity of the Premium Income Fund (Fund)
announced on 6 May 2011 and 10 May 2011 that it will undertake a non-renounceable rights issue to
Unitholders in the Fund (Offer) on the basis of an entitlement to subscribe for one New Unit for every three
existing units held at the record date being 7pm (AEST) on 18 May 2011. On 17 May 2011, Wellington
confirmed by way of announcement a revised issue price of $0.09 per New Unit. The rights issue will
therefore see up to 276,844,256 New Units being issued to raise up to $24.91 million.
The New Units will be issued without disclosure to investors under Section 1012DAA of the Corporations
Act 2001 (Corporations Act) as modified by ASIC Class Order 08/35.
Further details regarding the issue are set out in the Information Booklet following this Notice.
For the purposes of Section 1012DAA(7) of the Corporations Act, Wellington advises that:
(a) the New Units will be offered for issue without a Product Disclosure Statement;
(b) this Notice is given under Section 1012DAA(2)(f) of the Corporations Act;
(c) as a disclosing entity, the Fund is subject to regular updating and disclosure obligations;
(d) As at the date of this Notice Wellington Capital as responsible entity of the Premium Income Fund
has complied with the provisions of:
(i) Chapter 2M of the Corporations Act as it applies to the Fund; and
(ii) Section 674 of the Corporations Act as it applies to the Fund;
(e) This Offer is not underwritten.
(f) As at the date of this Notice, there is no excluded information of the type referred to in Sections
1012DAA(8) and Section 1012DAA(9) of the Corporations Act;
(g) This issue of New Units pursuant to this Offer is not expected to have any material effect or
consequence on the control of the Fund, but it is dependent on a number of factors including investor
demand. However, to the extent that any Unitholders fail to take up their Entitlement under the
Offer, the percentage holdings of those Unitholders in the Fund will be diluted by those other
Unitholders who take up some, all or more than (i.e by subscribing for additional units under the Top
Up Facility) their Entitlement.

 

[seamisty]

And another re Rights Issue Information Booklet http://www.nsxa.com.au/ftp/news/021724029.PDF

I note PIN is still in a trading halt.

 

[elizaman]

:bandThanks to all who have logged on and posted their support for the PIFAG re the proposed removal of Wellington Capital as Responsible Entity of our Fund. We encourage EVERY PIF unit holder to use this forum to continue to show support by posting here to demonstrate we are not a minority group of disgruntled investors. We are the UNITED MAJORITY, determined to claw back the remnants of OUR grossly mismanaged, strongly diluted PIF!! We are no longer naive and we know we were conned so please make the effort to register and post. It is time to speak up and I look forward to meeting you all in person at the EGM in Sydney on the 16th June!! Seamisty

Thanks. Great effort by all members to get it this far. In line with bespokes comments though "out of the fire" I'm hoping that an actual plan or straegy is tabled prior to the meeting rather than the usual "Prepare separate workout strategies" and "Implement workout strategies in a cost-effective and efficient manner" along with pointing out Wellington's very poor form. This alone should seal the deal = however what sticks in my mind is will there be a stock forum 1 year from now doing something similar to Castlereagh?
Point that also comes to mind is politics where the newly elected party usually points the finger at it's predecessor for the first year or so for all the problems.
In saying there will be no fire sales - this is an action I agree with however WC have said in there very few correspondances that they want to realize the full value of the properties and have passed in on some I believe. The market and available cash certainly has been strained worldwide in the last few years. What will Castlereagh do thats any different from this?? Send us a newsletter every month to tell us this?? WC probably made a mistake by trying to place terms or projected timelines on there strategy which has been proven to be insufficent. Will Castlereagh provide a similar list of their intentions and timelines if nothing more that a document that us uniformed investors can use as a guide or comparison? Will we also receive any documentation outlining potential costs for legal work, class actions etc, best and worst case scenarios if WC is fully paid in accordance with the constitution or chances on a percentage basis of WC being paid a portion of their fee as is the attempt?? Also a document/s outlining the the recent share placement at 10 cents on the dollar and the chance we might have to rescind it or have those shares valued in line with our shares which we all paid 1.00 for and therefore the newer shares ould only have a tenth of the voting right. What are the chances and the potential costs for righting this wrong which as you've mentioned our beloved public servants cannot do or don't think they can at least.
I'm assuming I'm not that popular right now so let me finish by saying that I fully support this action group and as there is no connection between Castlereagh and the PIF AG I think it's only fair that Castlereagh be held to the same standards as WC by providing more detailed information. Lets not kid ourselves here - everyone wants there money back so - when do they think they can do it and how??
I also know that if it had not been for the PIF AG we would not be where we are today and we would not have WC actually sending out info and recent updates etc which appear somewhat positive albeit delayed. I also think that there is merit in another members comments involving WC's commitment over the last few years which I also don't believe will go away without some firm obstacles in place.

With respect

 

[JohnH]

And another re Rights Issue Information Booklet http://www.nsxa.com.au/ftp/news/021724029.PDF

I note PIN is still in a trading halt.

Seamisty, how can we stop this latest decimation of our fund? This means that to maintain the voting power of our units we would have to chuck in a further 27% of our original investment! We both know (and I'm sure that JH knows) that there are very few of our investors who would be in a position to pay out this amount even assuming they were prepared to.

That aside, why does WC need the money? If, as according to the prospectus they have realised a net $82.5m that still leaves $67.5m after our two paltry hand-outs. - or did that go towards paying off the RBS loan?

Even if we bought forward our meeting, they have put in a clause "The Responsible Entity reserves the right to vary these dates and times without prior notice, including the right to close the Offer early, or to withdraw the Offer, or to accept late applications." There must be something we can do!!

 

[seamisty]

And another re Rights Issue Information Booklet http://www.nsxa.com.au/ftp/news/021724029.PDF

I note PIN is still in a trading halt.

Am I missing something here?:
'This Information Booklet is not a product disclosure statement and does not contain all of the information that an investor may require in order to make an informed investment decision': Why doesn't it contain ALL the information?

'An investment in New Units under this Information Booklet should be
considered speculative.' And ASIC considers this move to be in the best interests of existing PIF unitholders

'By subscribing for their Entitlement, Eligible Unitholders avoid being diluted in their holding'

And who will take up the shortfall if existing investors don't? O yes, the current RE will offer them to other interested parties at their discretion. Well sorry Wellington Capital, but this Fund is almost totally STUFFED as a result of your DISCRETION!!!

It appears WC couldn't even interest enough 'sophisticated' or 'professional' investors to take up the full original offfer of 113,000,000 units and fell short by 37.5 million units. Did those 'potential' investors see the writing on the wall that there will be a very strong chance that Wellington Capital could well be deposed in the not to distant future? And we have just witnessed how easy it is for an RE to 'change the constitution' at their whim!! Well if nothing else it appears current unit holders are champing at the bit to sign those papers!! Seamisty

 

[JohnH]

= however what sticks in my mind is will there be a stock forum 1 year from now doing something similar to Castlereagh?"

Some very valid points Elizamann. However there is one huge difference between our original naive surrender to the (at best) over optimistic offerings of WC............ we have had the Action Group working diligently behind the scenes, researching and evaluating, and (I hope) we are now a hell of a lot wiser.

 

[ASICK]

... In saying there will be no fire sales - this is an action I agree with however WC have said in there very few correspondances that they want to realize the full value of the properties and have passed in on some I believe. ...

Just what is a fire sale? How long is a property to be held before being sold in order to avoid a 'FIRE SALE' tag?

Is a sale at fair price in the prevailing market a fire sale? I think not. So, why aren't assets disposed of more speedily? How about loss of interest on capital retained in these funds?

Does the tag 'fire sale' continually prevent asset disposal and thereby prevent return of investor capital?

I think it does - I think investor fear of fire sales is a manager's best friend.

 

[zixo]

In My personal Opinion
There are those of us who are having thoughts that Wellington capital have had the investors interests first and foremost as a priority and due to the distressed nature and world financial circumstances they have had little option but to take the course and actions they have. BULL!

Everyone has a choice

Just a few items that we, as original investors need to keep in mind.
During the dealings with IMF and the class action wellington has hindered investigations, stalled disclosure and blatantly sought to protect the crooks who raped the fund and put us in this situation in the first place.

If any money is ever derived from a class action wellington will do everything in their power to get your compensation. Nothing is ever protected by law as we now well know with ASICs pathetic attitude.

Hutson lied about return to fund in three years, She Lied about the 3 cents return of capital which was due 3 years ago. She lied about a fair and free election when the investor advisory committee was installed. She lied to the very investors she swore to work for.

If you suspect Jenny Hutson and wellington Capital are going to miraculously change....think again

If its my choice of opting for the frying pan or fire. Its safer to jump into the fire and try and scramble out to save yourself Than have a responsible entity like wellington Capital, chain you to a stake and torture you slowly.

 

[elizaman]

Just what is a fire sale? How long is a property to be held before being sold in order to avoid a 'FIRE SALE' tag?

Is a sale at fair price in the prevailing market a fire sale? I think not. So, why aren't assets disposed of more speedily? How about loss of interest on capital retained in these funds?

Does the tag 'fire sale' continually prevent asset disposal and thereby prevent return of investor capital?

I think it does - I think investor fear of fire sales is a manager's best friend.

This was my point. Who decides when a property should be sold or passed in. Telling me you'rre going to strategize and preparre plans etc etc is great but who and how makes the decision on what set of parameters. I know it's tough as some investors can hold on a while and have the time for the market to correct iself somewhat. Other investors want out now due to age/health etc possibly. So that being said , what would be the strategy under those circumstances?? Put it in writng. I think something like the advisory committee was a good idea as long as it was involved and kept well informed. I also think that it should be 7 members to broaden the persective from the fund. I'll assume that the committee we had could not all get togther at the same time sometimes and WC may have taken advantage of that or not. Was therre minutes recorded? Were they issued? Without these wee have no ideaa of there involvement one ay or the other. A new committee should actually pass comment on all potential sales/deals etc which the RE would utilixe in making the final decision.
I'm for the change but it has to be the right change for the right reason's

Regards

 

[elizaman]

= however what sticks in my mind is will there be a stock forum 1 year from now doing something similar to Castlereagh?"

Some very valid points Elizamann. However there is one huge difference between our original naive surrender to the (at best) over optimistic offerings of WC............ we have had the Action Group working diligently behind the scenes, researching and evaluating, and (I hope) we are now a hell of a lot wiser.

Thanks. And a great job at that for those of us that have not been able to keep up to date or even know where to look for that matter. Wiser is great also. Comes with making mistakes half the time and learning from them. Castlereagh needs to ouline their plan just a little more in detail though so we can all decide on either the devil we know or the devil we don't know. Based on the recent post from seamistry the change can't come fast enough , but also what would prevent Castlereagh from doing the same thing??. Would there be a new constitution written to avoid this blantant abuse of power with the share issue's and it's subsequent diltuion of our own units??

 

[elizaman]

Am I missing something here?:
'This Information Booklet is not a product disclosure statement and does not contain all of the information that an investor may require in order to make an informed investment decision': Why doesn't it contain ALL the information?

'An investment in New Units under this Information Booklet should be
considered speculative.' And ASIC considers this move to be in the best interests of existing PIF unitholders

'By subscribing for their Entitlement, Eligible Unitholders avoid being diluted in their holding'

And who will take up the shortfall if existing investors don't? O yes, the current RE will offer them to other interested parties at their discretion. Well sorry Wellington Capital, but this Fund is almost totally STUFFED as a result of your DISCRETION!!!

It appears WC couldn't even interest enough 'sophisticated' or 'professional' investors to take up the full original offfer of 113,000,000 units and fell short by 37.5 million units. Did those 'potential' investors see the writing on the wall that there will be a very strong chance that Wellington Capital could well be deposed in the not to distant future? And we have just witnessed how easy it is for an RE to 'change the constitution' at their whim!! Well if nothing else it appears current unit holders are champing at the bit to sign those papers!! Seamisty

Has it occured that this may be a plan to increase voting rights by someone else close to WC's mandate?? It says there is no minimum price required, based on the recent issue at 10cents 7.5 mil still sold. Now there at 09 cents this so called "sophisticated investor" could be looking to align there units with someone else. PIF AG says it has control of 27 % I think I read somewhere.??? That still leaves 73% out there somewhere and with dilution at this rate it doesn't take long to swallow up a majority of units for voting purposes possibly. It's also happening very quickly and so soon after the 10 cent issue. seems odd.

 

[waleroo]

People we got it wrong installing Wellington let get it right this time WE CAN NOT BE ANY WORSE OF THAN WE ARE LETS GET RID OF WELLINGTON NOW IF WE HAVE TO PAY A PENALTY PAY BUT GET RID OF THEM

 

[ASICK]

Thanks. And a great job at that for those of us that have not been able to keep up to date or even know where to look for that matter. Wiser is great also. Comes with making mistakes half the time and learning from them. Castlereagh needs to ouline their plan just a little more in detail though so we can all decide on either the devil we know or the devil we don't know. Based on the recent post from seamistry the change can't come fast enough , but also what would prevent Castlereagh from doing the same thing??. Would there be a new constitution written to avoid this blantant abuse of power with the share issue's and it's subsequent diltuion of our own units??

When investors invite a new RE into the fund, there must be a clearly defined plan. Although unenforceable, there must be also some sort of undertaking not to introduce new 'strategies'.

Would any of you voted for W.C. if you were told that new units would be issued at price derived from an unfavourable market? I'll bet you wouldn't have.

I'd guess that none of you would be surprised just what can be dreampt up by a manager which is able to fit under the "in investors' best interests' umbrella which ASIC is more than content to do nothing about.

Investors invite new managers into funds as one might invite a guest into one's home, but unless a guest, managers take over the fund and run it as their own.

I've posted before on this forum about the dilemma managers have about the sale of assets - if they sell at current market value to speed up capital payments, then investors complain - if they hold on to improve asset prices but assets fail, then they're in trouble too. Why is this? In my view it's because investors never have a say about what price they're prepared to accept for assets, and as a consequence, are in the box seat 'at the colloseum' (so to speak).

Without a clear plan which includes guidelines for the disposal of assets, and without specific undertakings not to introduce new 'strategies', you very much do risk jumping out of the frying pan and into another one, nevermind the fire (or fire sales).

In my view, an undertaking not to fire sale assets is a negative, not a positive - but, I'm sure, consistent with the abovementioned dilemma, many will not agree.

 

[Investor262]

THANK YOU to seamisty, Charles, breaker and all the others for the massive effort. I am with you 1000% but am unable to get to the EGM. How do i organise a proxy vote?

 

[reasonable]

Hello everyone
I must thank Seamisty, Breaker and others for the hard work they have and are putting in for us.

I can’t make Sydney but would dearly like to but you have my full support. Although I voted against Wellington I am surprised that it has taken so long to attempt their removal – but I guess it has taken time to gain the support and needed a tipping point which we now have. For one I think the main priority is to get rid if JH even if it costs $5m (maybe this could be negotiated down - after all JH's so-called reputation would be irreparably damaged after being thrown out as RE) it is a small amount compared to what JH has already lost us.

Regards

 

[seamisty]

THANK YOU to seamisty, Charles, breaker and all the others for the massive effort. I am with you 1000% but am unable to get to the EGM. How do i organise a proxy vote?

Investor262 if you are at your usual adress you will receive an information package in the next few days. You can then fill out
and return the enclosed Proxy Form to Computershare Investor Services
Pty Limited by no later than 4.00 pm on 13 June 2011 by any of the
following options:

Post: Computershare Investor Services Pty Limited, GPO Box 2062,
Melbourne VIC 3001 (reply paid envelope provided)

Facsimile: (03) 9473 2145

Email: quorum@computershare.com.au

For those who are currently overseas, on holidays etc and will have no way of lodging their own vote, you can email the pifactiongroup@gmail.com with your name, the name the investment is in, the amount of units and a contact email and ph no, and an action group member will organise a proxy vote on your behalf.

Seamisty

 

[Bessie223]

Thanks to Seamisty, Breaker and all of the others who have worked so hard for all of us. You have my full support . I am unable to attend the meeting in Sydney but will vote by mail if possible or can we allow the PIF AG to vote on our behalf? Once again thanks for all your effort.

 

[Investor262]

Investor262 if you are at your usual adress you will receive an information package in the next few days. You can then fill out
and return the enclosed Proxy Form to Computershare Investor Services
Pty Limited by no later than 4.00 pm on 13 June 2011 by any of the
following options:

Post: Computershare Investor Services Pty Limited, GPO Box 2062,
Melbourne VIC 3001 (reply paid envelope provided)

Facsimile: (03) 9473 2145

Email: quorum@computershare.com.au

For those who are currently overseas, on holidays etc and will have no way of lodging their own vote, you can email the pifactiongroup@gmail.com with your name, the name the investment is in, the amount of units and a contact email and ph no, and an action group member will organise a proxy vote on your behalf.

Seamisty

Thanks Seamisty, at last some light at the end of the tunnel. Just sorry I won't be able to meet up with all of you and put faces to name. Thanks again!!!!