The proposed scheme of arrangement which is for compromise between City Realcom Limited and its creditors, is not clear.
As far as I understand that City Limouzines(I) has obtained deposits under car rental scheme and allotted Preference Shares, equivalent to margin money(excluding Insurance, RTO charges, etc.), which are redeemable after 5 yrs and paying us a fixed monthly rent/hire charges.
City Realcom Limited has obtained deposits under real state rental scheme and allotted preferential shares for Rs107000/- from its authorized capital. Out of which Preference Shares for Rs. 50, 000/- has been allotted redeemable after 5 yrs. And to safeguard the interest of investors for the remaining Preference shares of Rs. 57, 000/-, has allotted a tentative ownership of a piece of land and paying us Rs. 7775/- p.m.(as rent for piece of land, benefit on Preference Shares and Fixed Deposit).
The proposed scheme says that it does not in any manner alter the status of the Preference Shares and their holders. The scheme is for the creditors(dehors the Preference Shares) which means, as I understand, excluding the Preference Shares holder. The rights or the creditors in their capacity as preferential share holders shall continue and not be affected by the present scheme. Does it mean that investors will get their money as before?
There are two notices for meeting of the Preference shares holders, unsecured creditors of the City Limouzines(I) and City Realcom Limited and the third notice is addressed to unsecured creditors of the City Limouzines(I) Ltd. It is not clear whether the investors of the above mentioned schemes are secured creditors or unsecured creditors of the company?
In the Form of Proxy, it is mentioned that “I/we, the undersigned, unsecured creditors of City Limouzies(I)……………”
Who has to vote for and against the proposed scheme of arrangements?
If unsecured creditors only then, why the meeting of the Preference Shares holders has been called for and payment has been stopped from Aug, 09 onwards?
The preferential share holders has the right to vote or not for and against the proposed scheme of arrangement?
A common person like me and so many others investors are unable to understand the proposed scheme of arrangement.
The Company or its lawyers should clarify clearly in the simple and clear language whether the investors of the above mentioned schemes are secured or unsecured creditors of the company and the proposed scheme of arrangements is also for these investors or not and who has the right to vote?
If any one understands the scheme please let me know by your comments.