Insights from the Supply@Me Capital PLC Annual General Meeting

The Annual General Meeting (AGM) of Supply@Me Capital PLC provided important updates on the company’s financial status, funding commitments, and future strategies. This report covers key discussions and decisions made during the meeting, focusing on the challenges faced by the company and its plans for recovery.

Table of Contents

• Opening Remarks and Introduction
• Introduction of Board Members
• Declaration of AGM Opening
• Overview of AGM Agenda
• Corporate Funding Recap
• Recent Equity Placing Details
• Funding Commitments from TAG
• Update on Unsecured Working Capital Facility
• Accounts Receivable Update
• Top-Up Loan Agreement Overview
• Future Corporate Funding Outlook
• TAG Specific Issues Discussion
• Business Update and Revenue Generation
• Platform Development and Monitoring
• Discussion on Serious Loss of Capital
• Live Q&A Session Highlights
• Formal Business Resolutions
• Conclusion and Closing Remarks
• FAQ Section

Opening Remarks and Introduction

The Supply@Me Capital PLC Annual General Meeting commenced with a warm welcome to attendees. The chair, Albert Gushan, formally opened the proceedings.

Introduction of Board Members

The meeting began with the introduction of the board members present for the AGM. This established the leadership team overseeing the company’s operations and strategic decisions.

Declaration of AGM Opening

The Annual General Meeting was officially declared open by Albert Gushan, the chair. This formal announcement marked the commencement of the proceedings.

Overview of AGM Agenda

The chair provided a brief outline of the meeting’s agenda. Key items included the introduction of board members and management team, followed by discussions on company performance and future strategies.

Board and Management Introductions

Attendees were introduced to key figures in the company’s leadership:

• Alexandra – Chief Executive Officer
• Enrio Camer – Independent Director (remote)
• David Bull – Non-Executive Director
• Alexander Gallagan – Non-Executive Director

The management team was also present, emphasizing the comprehensive representation of company leadership at the AGM.

Corporate Funding Recap

The company recently completed an equity placing to address financial challenges. This section provides an overview of the funding situation and its implications for Supply@Me Capital PLC.

Recent Equity Placing Details

In May 2024, Supply@Me Capital PLC issued 9 billion new ordinary shares, raising gross proceeds of £1.5 million. This funding was crucial for meeting working capital requirements and improving the company’s net asset position.

Key Points of the Equity Placing

• Straightforward placing, not a CIN or convertible loan note
• Shares initially transferred to a UK investment fund
• Approximately 50 private investors received shares
• No investors breached TR1 form submission thresholds

Funding Commitments from TAG

Supply@Me Capital has entered into three separate contractual funding agreements with TAG over the past 15 months. These agreements were made to secure more favorable borrowing conditions, given the company’s startup nature and current external debt costs.

Related Party Transactions

As TAG is a related party to Supply@Me, all arrangements underwent careful board consideration and followed DTR requirements for related party transactions. TAG has faced its own cash flow issues, leading to delays in fulfilling contractual obligations.

Update on Unsecured Working Capital Facility

The unsecured working capital facility, initially agreed in April 2023 and amended in June 2023, provided £800,000 to the company. This facility has been fully funded by TAG, completed in Q1 2024.

Repayment and Settlement

In March 2024, Supply@Me agreed to repay the facility early through the issuance of 1.5 billion new ordinary shares to TAG. This settled the full £800,000 principal and any accrued interest.

Accounts Receivable Update

The company has a small outstanding receivable of approximately £100,000 from TAG. This amount includes late payment interest and will not require repayment by the company to TAG.

Top-Up Loan Agreement Overview

In September 2023, a top-up loan agreement was established, allowing the company to draw up to £3.5 million until June 2025. The agreement features monthly draw-downs based on a pre-agreed formula linked to forecast cash balances.

Current Status

Between November 2023 and March 2024, the company drew down £2 million from this facility. However, significant delays in funding have occurred, with the entire amount still outstanding and accruing interest.

Future Prospects

TAG has informed the board that it’s finalizing cash flow arrangements. They intend to use $1.5 million USD for partial settlement of outstanding amounts owed to Supply@Me Capital PLC.

Future Corporate Funding Outlook

The company’s focus is on creating stable, recurring revenue to cover monthly expenses. This approach aims to reduce the need for future debt and equity funding.

Potential Funding Strategies

• Continue working closely with TAG
• Utilize remaining shareholder loan facility
• Consider additional equity funding if necessary

The board seeks shareholder approval to issue up to 20% of current ordinary share capital for flexibility in future funding decisions.

TAG Specific Issues Discussion

Alexandro addressed three main topics related to TAG. These discussions aimed to provide clarity on the company’s relationship with TAG and ongoing financial arrangements.

Outstanding Warrants

The company noted several outstanding warrants in the market with various expiry dates. Exercise of these warrants would result in the issuance of new ordinary shares.

Business Update and Revenue Generation

Supply@Me Capital PLC is fully committed to generating revenue, recognizing it as the primary path to increase company value. The focus is on finding the right structure to facilitate this goal.

Funding Structure Evolution

The company has progressed through three key phases:

• Initial concept phase with limited capital
• Acquisition of TradeFlow to enhance funding structure
• Current phase with committed capital ready for deployment

Role of SoFi Finance SV

SoFi Finance SV plays a crucial role in the funding structure as a strategic equity provider. It helps bridge the gap between bank funding and total inventory purchase requirements.

Revenue Model Clarification

Supply@Me generates revenue through two main streams:

1. Origination of clients (pipeline development)
2. Service fees for each inventory monetization deal

Platform Development and Monitoring

The company has invested significantly in developing a robust platform for inventory management and client onboarding. This section outlines key aspects of the platform’s evolution and future plans.

Foundation Building

Critical steps in platform development included:

• Establishing secure data sharing processes
• Hiring the right team with appropriate skillsets
• Developing methods for selecting suitable inventory

Unique Selling Propositions (USPs)

The platform has been designed to accommodate various inventory models, recognizing that one size does not fit all. This flexibility allows for customization to different client needs.

Data Management and Fraud Prevention

Emphasis has been placed on efficient data ingestion, organization, and analysis. This enables effective monitoring and early detection of potential fraudulent activities.

Future Development Focus

Upcoming platform enhancements include:

• Faster initial client assessments
• Implementation of ERP API feeds
• Automated monitoring systems
• Development of a trading workflow

The ultimate goal is to provide clients, stock companies, and inventory funders with a comprehensive, real-time view of ongoing operations.

Discussion on Serious Loss of Capital

Supply@Me Capital PLC addressed the ongoing issue of serious loss of capital, as defined by the Companies Act. This situation, where net assets are less than half of the called-up share capital, has persisted since 2014.

Historical Context and Recent Developments

The company’s financial position has been affected by several factors:

• Acquisition of TradeFlow
• Debt repayment through capital enhancement plan
• Significant impairment charges in 2022
• Disposal of 81% of TradeFlow

Future Outlook

The board acknowledges the ongoing issue and believes future revenue generation from current initiatives will alleviate the problem in coming years.

Live Q&A Session Highlights

The Q&A session addressed key themes raised by shareholders through the invest me platform. Topics included:

• Share price declines and company actions
• Business performance and delays
• TAG stock loans and company relationship
• Platform development progress
• Recent equity funding and potential dilution

The session aimed to provide clarity on these issues and address shareholder concerns directly.

Formal Business Resolutions

The AGM proceeded with the formal business resolutions. Eight resolutions were presented for shareholder vote, covering key company matters.

Ordinary Resolutions

Resolutions 1-6 were proposed as ordinary resolutions, requiring a simple majority to pass. These included:

• Receiving annual reports and accounts
• Approving directors’ remuneration report
• Appointing auditors and determining their remuneration
• Appointing a new non-executive director
• Authorizing directors to allot shares

Special Resolutions

Resolutions 7-8 were proposed as special resolutions, requiring a 75% majority. These covered:

• Disapplication of pre-emption rights
• Authorization for shorter notice periods

Conclusion and Closing Remarks

The AGM concluded with the formal voting process. Shareholders were instructed on proper voting procedures, including the use of polling papers.

Vote Counting and Results

The company announced that vote counting would occur after the meeting. Results will be published via RNS announcement once tabulated.

Closing Statement

The chair thanked shareholders for their continued support and officially closed the AGM. This marked the end of the formal proceedings for Supply@Me Capital PLC’s Annual General Meeting.

FAQ Section

This FAQ section addresses key questions raised by shareholders during the Supply@Me Capital PLC Annual General Meeting. It covers topics ranging from share price concerns to business operations and future outlook.

Share Price and Company Performance

Many shareholders expressed concerns about the company’s share price performance. Here are some key points addressed:

• Management acknowledges shareholder disappointment
• Focus is on generating revenue to increase company value
• Share price affected by multiple factors beyond direct control

Why has it taken so long to generate revenue?

The company provided several reasons for the delay in revenue generation:

• Transition from TradeFlow infrastructure to SoFi Finance SV
• Time required to establish new funding structures
• Rigorous due diligence processes by commercial banks
• Need to meet specific requirements from inventory funders

What is the current status of deals with Bank BPM and other funders?

The company provided updates on ongoing deals:

• Bank BPM committed to provide €8.5 million in funding
• Delays due to additional requirements from the bank
• Working to finalize agreements with remarketers
• Expect faster execution of future deals once first transaction completes

How does the company plan to scale its operations?

The company outlined its strategy for scaling operations:

• Leverage existing pipeline of clients
• Utilize open market inventory monetization
• Expand white label partnerships with commercial banks
• Continuously improve platform capabilities

What is the role of SoFi Finance SV in the company’s structure?

SoFi Finance SV plays a crucial role in the company’s funding structure:

• Acts as a strategic equity provider
• Bridges gap between bank funding and total inventory requirements
• Enhances credibility with inventory funders
• Facilitates transactions and deal flow

How does the company generate revenue?

Supply@Me Capital generates revenue through two main streams:

1. Origination fees from client acquisition and pipeline development
2. Service fees for each inventory monetization deal

What improvements have been made to the company’s platform?

The company has made significant investments in its platform:

• Enhanced data security and sharing processes
• Improved client onboarding and assessment
• Automated monitoring systems for fraud detection
• Development of CRM module for pipeline management

How is the company addressing its “serious loss of capital” situation?

The company provided an update on its financial position:

• Issue persists since 2014, predating Supply@Me Capital
• Recent events (TradeFlow acquisition, disposals) impacted net assets
• Future revenue generation expected to alleviate the problem
• Board continues to monitor and address the situation

What is the status of TAG’s funding commitments?

The company provided updates on TAG’s funding commitments:

• Unsecured working capital facility of £800,000 fully funded
• Small outstanding receivable of approximately £100,000
• Top-up loan agreement with £2 million drawn, currently outstanding
• TAG finalizing arrangements to partially settle outstanding amounts

How does the company plan to address future funding needs?

The company outlined its approach to future funding:

• Focus on creating stable, recurring revenue
• Continue working with TAG to receive outstanding amounts
• Utilize remaining shareholder loan facility
• Consider additional equity funding if necessary

What is the company’s strategy for inventory monetization?

The company’s strategy involves two main avenues:

1. Open market inventory monetization using existing pipeline
2. White label partnerships with commercial banks

Both approaches leverage the company’s platform, expertise in inventory management, and relationships with funders.

How does the company ensure the quality of inventory being monetized?

The company has implemented several measures to ensure inventory quality:

• Rigorous selection process for suitable inventory
• In-depth analysis of client data and business processes
• Automated monitoring systems to detect anomalies
• Partnerships with independent inspection services

What is the company’s outlook on the inventory monetization market?

The company views inventory monetization as a significant opportunity:

• Estimated market size of over €4 trillion in Europe
• Limited competition in the space
• Growing demand for alternative financing solutions
• Potential for expansion into new verticals and geographies

How is the company addressing shareholder concerns about transparency?

The company has taken steps to improve transparency:

• Regular updates through RNS announcements
• Detailed presentations at Annual General Meetings
• Publication of educational videos on client onboarding and monitoring
• Open Q&A sessions with shareholders

What are the key risks facing the company?

The company acknowledges several key risks:

• Delays in revenue generation and deal execution
• Dependence on external funding sources
• Potential for client fraud or default
• Regulatory and compliance challenges in new markets
• Competition from traditional financing providers

How does the company plan to attract and retain clients?

The company’s strategy for client attraction and retention includes:

• Focusing on industries with high inventory turnover
• Offering flexible inventory monetization models
• Providing value-added services through its platform
• Building strong relationships with commercial banks
• Continuously improving the client experience

What is the company’s approach to corporate governance?

The company emphasizes strong corporate governance practices:

• Independent board members with relevant expertise
• Regular board meetings and committee oversight
• Compliance with AIM rules and regulations
• Transparent reporting of related party transactions
• Engagement with shareholders through various channels

How does the company plan to expand internationally?

The company’s international expansion strategy includes:

• Leveraging existing relationships with global banks
• Identifying key markets with high inventory financing needs
• Adapting the platform to meet local regulatory requirements
• Partnering with local entities to facilitate market entry
• Gradual expansion to minimize risks and ensure proper execution

What is the company’s stance on environmental, social, and governance (ESG) issues?

While not explicitly addressed in the AGM, the company recognizes the importance of ESG:

• Inventory monetization can improve supply chain efficiency
• Platform development focuses on data security and privacy
• Commitment to ethical business practices and transparency
• Potential for future initiatives to address specific ESG concerns

How does the company plan to communicate with shareholders going forward?

The company outlined its shareholder communication strategy:

• Regular RNS announcements for material developments
• Annual and interim financial reports
• Investor presentations and roadshows
• Engagement through investor meet company platform
• Open dialogue at Annual General Meetings

The company remains committed to addressing shareholder concerns and providing timely updates on its progress in implementing its business strategy and generating revenue.