Avocet patent sale "Now Done", chairman tells investors

by DOUG COLLIE

The bulk of the proceeds from the sale of the Avocet Group's intellectual property (IP) has been paid into a bank account and will be available in two to four weeks, according to Martin Frost, the company chairman who has yet to identify the purchaser and the amount received for the so-called 'jet fuel from air' patents.

Hundreds of shareholders in Avocet Natural Capital PLC were told of the sale in a letter titled 'Now Done' emailed by Mr Frost to investors yesterday (Saturday).

The news followed claims made on the Avocet Shareholders' Forum a few days ago that many of the patents had either expired, been withdrawn or patent renewal fees had not been paid. It was suggested that shareholders should engage a patents attorney with a chemical background to assess the situation. 

However, the ANC chairman countered those assertions by stating: "Due to timewasters...some of you became concerned over the ‘jet fuel from air patents sale’. Happily, solicitor Kit Jarvis, of Fieldfisher, provided the necessary documentation to prove that Avocet IP Limited (an ANC subsidiary) was the true patent owner with no reservation of title. 

"Thus, I am pleased to advise that the bulk of the sale proceeds was paid into an escrow bank account this Wednesday 21st April 2021. Some two to four weeks will now pass before Avocet IP Limited has full access to its funds, thereafter ANC Plc will obtain HMRC guidance before: An ANC Plc shareholder dividend is issued. A Gennfros shareholder dividend is issued. Creditor payments are made to the old Infinite (now Omega group).

"I am pleased to advise that the arrival of these funds now allows Avocet and Gennfros to continue with both civil and private criminal prosecutions against the bad folk – namely the timewasters, Aileen Orr, and Aileen’s adherents.

"Finally, those of you fortunate enough to hold Gennfros Limited shares, I can confirm the second offers are in process to you once Gennfros Limited’s Confirmation statement is issued during early May - showing the Up To Date shareholder position of our new investors."

News of the sale follows the seven years existence of the Avocet 'disruptive technology' businesses which have yet to bring their products to the market. This has fuelled concern among some investors who have expressed their worries over the apparent lack of progress on the shareholders' Forum.

But some of that Forum negativity was countered yesterday by investor Gavin Davidson who submitted the following contribution: "Given the latest ANC update from Martin. I wonder how many of you "Negative Nancy`s" are actually relieved that everything he has been trying to convince you of over the last few years is actually coming to fruition.

"I guess that all you "Naysayers" are actually relieved that you will get a positive return on your original investment (In ANC) after perpetually spouting that it was a conspiracy to steal our money. I
look forward to all your vitriol as is the norm on this "Shareholders Forum".

An anonymous poster retorted: "Hi Gavin, How much money have you actually received? Once again Frost says that money will be paid out some time in the future. It will evidently take 2 to 4 weeks for money to be available, thereafter guidance is sought from HMRC and then a dividend might be issued.

"The money is however available right now to "to continue with both civil & private criminal prosecutions against the bad folk – namely the timewasters, Aileen Orr, and Aileen’s adherents. "

"Sorry but an e-mail is insufficient to alleviate my suspicions. As a shareholder I should be entitled to see the accounts and to be kept properly informed. Getting silly cartoon characters, statements about "bad people" "bully girls" etc. sent to me on a regular basis is no way to run a company.

"It is good to know that Frost's e-mail has made you happy. I am fed up with the jam tomorrow e-mails therefore personally, I will wait until I see the money. At that point I will happily say my suspicions were wrong."

Reports tell very different stories

 by EWAN LAMB

The remaining intellectual property of a company with links to the Avocet 'disruptive technology' Group is said to have a book value of only £493,000, a fraction of the £4 million estimate provided by the directors in a Declaration of Solvency signed in 2015.

And new figures show that instead of an estimated surplus of £1.156 million, AFS Ventures Ltd now has an estimated deficiency of over £200,000. In addition, the cost of liquidating AFS, anticipated to be nil when the business entered Members Voluntary Liquidation (MVL) six years ago now stands at £100,000.

Martin Frost, the businessman who is the only surviving director of AFS Ventures, and who chairs Avocet Natural Capital, has already claimed that a share convertible loan of £2.1 million from 'new investors' will enable Avocet Infinite (now called Omega Infinite and in compulsory liquidation) to pay off its creditors, "especially AFS Ventures".

However, AFS liquidator Eric Walls has produced a so-called Statement of Affairs for the company in a move which precedes a conversion of a solvent liquidation to a creditors' voluntary liquidation or insolvent liquidation. The statement is now available on the Companies House website.

As we reported last month, Mr Walls has already warned of serious consequences for directors and shareholders resulting from a switch from a MVL to an insolvent dissolution.

Several business advice websites include the following passage: "If it turns out the company is actually insolvent, the possible consequences are: The company will be placed into creditors voluntary liquidation. Any funds received will have to be repaid to the company under an indemnity. You may face disqualification as a director."

Mr Walls' latest annual statement of receipts and payments included the following reference to the consideration for the AFS Ventures business and its IP: "Due to the commercial sensitivity of both the negotiations and the final agreement eventually reached between the parties concerned these matters will not be discussed further in this report."

But he added: "Shareholders should note that monies remain outstanding in respect of this sale [the IP] and as such full title to the IP referred to in the sale agreement has not fully passed to the prospective purchaser. This matter may well become subject to legal action".

The newly published Statement of Affairs allocates a book value of £493,000 for the remaining AFS patent[s] but the estimate as to how much the IP will realise is labelled "Uncertain". That leaves £20,614 of funds held by the liquidator as the only concrete asset.

Mr Walls provides details of unsecured non-preferential creditors who are owed £175,000 plus £1 due to Her Majesty's Revenue & Customs (HMRC). The deficiency also includes £50,000 in issued and called up share capital bringing the overall deficiency to £204,386.

The 50,000 shares in AFS are held by two companies, namely Loch Lomond Heritage Ltd. and Orr Developments Ltd., both controlled by Mr Frost.

The two principal creditors are law firm Womble Bond Dickinson (£75,000) and KSA Group Ltd., Mr Walls' employers (£100,000 for liquidation remuneration).

The Companies House file on AFS Ventures also includes a copy of the Declaration of Solvency signed by Mr Frost and witnessed by Bond Dickinson solicitor Victoria Smith in January 2015.

The declaration indicates that AFS directors "do solemnly and sincerely declare we have formed the opinion that the company will be able to pay its debts in full together with interest at the official rate within a period of twelve months from the commencement of the winding up".

Assets listed are: Intellectual Property £4,000,000; cash at bank £5,000; stock £1,000; and shares and investments £10. The liabilities noted are: Trade and expense creditors £1,850,000; provision for costs and expenses £1,000,000; estimated cost of liquidation £0.00. Estimated surplus after paying debts in full £1,156,010.

No accounting alarms Avocet investors

 by LESTER CROSS

The chairman of the Avocet Group of 'disruptive technology' businesses has attempted to dispel fears that his flagship company will be compulsorily struck off the register for failing to lodge annual accounts for 2019.

A number of the 680 shareholders who have invested tens of millions of pounds in Avocet Natural Capital PLC, headed by Martin Frost and Dr Bob Jennings, are said to have been alarmed by a notice posted on the Companies House website which threatens ANC with dissolution. 

It follows similar action taken by the Registrar against several other Avocet firms for failing to submit accounts or an annual confirmation statement on time. Most of these actions have been either suspended or discontinued following late filings by Avocet management.

In a shareholder letter sent to ANC stakeholders yesterday company chairman Mr Frost claims: " ANC Plc shall not be struck off the Company House Register as the audited accounts for ANC Plc shall be lodged before the end of May."

Therefore, there was no prospect that: ANC Plc shareholders would not receive a dividend from the IP [intellectual property] sale.

And, according to Mr Frost, there is no prospect that "Gennfros Limited shareholders will not receive a dividend Furthermore: Funds shall be available to restore Omega Infinite Plc to the Register: Funds shall be available to restore Orrdone Farms Limited to the Register ;Funds shall be available to satisfy all Avocet Bio Solutions Plc creditors. Funds shall be available to secure justice against the ‘Bully Girls’. Funds shall be available to secure justice against Mrs. Aileen Orr & her acolytes."

Omega (formerly Avocet) Infinite PLC has been in the hands of liquidators since early last year. That company had not filed accounts since 2017. The same applies to Orrdone (formerly Avocet) Farms Ltd. (in administration) although Mr Frost has pledged on several occasions to have both businesses restored to the register of companies.

He claims many millions of pounds are to be invested in Avocet's "revolutionary" fuel by unnamed investors while the sale of Avocet IP Ltd.'s patents is expected to yield up to £200 million. Avocet IP was served with a compulsory striking off notice on January 26th 2021, but the action was discontinued by the Registrar on February 9th.

In a separate case ANC subsidiary Avocet Agritech Ltd was the subject of a notice of compulsory strike off in December 2020, subsequently suspended in February of this year. The business should have filed accounts for 2018 by December 2019. It had not traded during 2017, according to the accounts for that calendar year. 

An individual with a "significant" stake in Avocet Natural Capital commented: "It is extremely worrying to learn such a substantial business could be dissolved for failing to abide by statutory regulations.

"We keep hearing of mysterious white knights about to ride to the rescue and deliver prosperity for all. Why doesn't Mr Frost or Dr Jennings name this wealthy consortium which has been wrapped in a web of secrecy since it was first mentioned last summer. There's no indication they've made so much as a dime available so far, and surely shareholders have a right to know what's happening".

FOOTNOTE: In what appears to be an unfortunate typographical error Mr Frost tells readers of his latest letter: "Going forward a tentative offer of $50 US dollars is made for the residual IP (after the jet fuel from air IP sale)".

A recipient of the correspondence remarked: "All of Nobel nominee ‘Bob’ Jennings’ work over the last six years, funded with an investment by the shareholders of £16 million, is worth exactly $50 US. Just what I suspected, but I am surprised Mr Frost is admitting it!"

Loan figures show Borders Council's debt profile

 by EWAN LAMB

A new set of statistics published by the Public Works Loan Board (PLB) which advances money to local authorities shows Scottish Borders Council's outstanding balance now stands at over £166 million which is £46 million more than the council owed in 2010.

Research by Not Just Sheep & Rugby has assembled a debt profile for SBC covering the period since the PWLB started publishing data eleven years ago. 

In the recent past the Borders council has fended off criticism that it has allowed its debt burden to grow too high even though current interest rates are at rock bottom.

As well as the 53 loans currently held by SBC the council has also borrowed money from other sources. But our table below only includes data made available by the PWLB.

Some of the borrowing from the Board dates back to the 1990s  while a substantial number of the loans are due to run until 2050 and beyond. The fixed interest rates range from 8.5% for sums acquired in 1995 down to just 1.49% for a ten year loan totalling £4 million arranged in 2016.

Much of the increase in the principal balance has occurred since 2016 when PWLB debt stood at £127 million. The March 2021 figure of £166.3 million showed a slight decrease from the previous year's figure of £167.1 million after three loans reached their maturity date.

Here's how the figures stack up:

Year ending	Number of loans	Balance outstanding	Year End Value
March 2010	50	£120,131,362	£154,109,980
March 2011	50	£120,131,362	£158,708,128
March 2012	51	£127,631,362	£194,623,718
March 2013	51	£127,631,362	£198,407,422
March 2014	51	£127,631,362	£187,033,833
March 2015	51	£127,631,362	£233,428,208
March 2016	51	£127,631,362	£236,795,464
March 2017	53	£139,631,362	£274,550,037
March 2018	54	£149,631,362	£281,363,738
March 2019	55	£159,631,362	£297,634,808
March 2020	56	£167,131,362	£348,479,343
March 2021	53	£166,369,133	not available

  SBC's Opposition Group leader Stuart Bell (SNP), who chairs the authority's audit and scrutiny committee claimed in a newspaper article two years ago that the amount of borrowing was limiting potential spending in other service areas. He claimed: “I have been repeatedly saying that Scottish Borders Council is nearly maxed-out on capital.

“There are strict fiscal limitations on the amount of money that a local authority can borrow and Scottish Borders Council is not unusual in being close to that upper limit."

In a detailed statement issued to media outlets in 2019 Scottish Borders Council had this to say on its levels of borrowing:

"The council’s liabilities associated with capital borrowing totalled £194.4m at 31 March 2018.

“This sum represents outstanding principal sum associated with the past capital investment decisions of the council and its predecessor authorities.

“The debt, which is financed predominantly via long term borrowing from the Government sponsored Public Works Loans Board, is broadly in line with the average debt level for Scottish local authorities.

“Most of this borrowing, undertaken to invest in the creation and enhancement of assets such as schools, bridges and roads and flood protection works, has been financed via long-term loans at favourable interest rates with varying maturity profiles.

“In order to ensure the most effective management of this debt, the council operates a loans fund.

“The level of capital borrowing undertaken by the council and the associated debt accounted for on the balance sheet is monitored and regulated using the Chartered Institute of Public Finance and Accountancy’s prudential code which ensures that borrowing by the council for capital purposes remains both affordable in the short term and financially sustainable over the longer term.

“The prudential code places limits on the level of borrowing which a council can prudently undertake, known as the operational boundary, and places an overall limit, known as the authorised limit, beyond which the council cannot undertake any further borrowing.

“Scottish Borders Council debt is significantly below both the operational boundary and our authorised debt limit, demonstrating the prudence of our approach."

Allegations galore as Avocet share inquiry continues

by DOUGLAS SHEPHERD

The joint liquidator of the company formerly known as Avocet Infinite PLC has issued a new appeal for information about the status of the insolvent business's 22 million shares amid claims of conflicting documentation.

A letter to shareholders of the renamed Omega Infinite Ltd. from Ashleigh Fletcher, of insolvency practitioners Begbies Traynor has been circulated while Avocet Group chairman Martin Frost told 'Infinite' shareholders at the weekend that a £1 share in the firm had increased in value by a thousand per cent over a four year period.

A year ago, in March 2020, the court granted a winding up Order against Omega Infinite following a petition by London law firm Fieldfisher. That petition was supported by counsel for Avocet subsidiary Orrdone Farms Ltd. (in administration), a creditor of the Omega business.

On Saturday a notice appeared on the Companies House website confirming the appointment of liquidators Mr Fletcher and Joanne Hammond on April 28th 2020.

Mr Fletcher's latest letter dated March 30th 2021 has gone to 'all known shareholders' and is marked 'Please Do Not Ignore'. It follows previous correspondence from Omega's joint liquidator in December.

Investors are told: "As mentioned in the letter (of last December) we have been informed that there is a number of shares in the company that are not fully paid despite share certificates (and supplementary documentation) stating otherwise.

"Accordingly, in order to avoid any discrepancies and to act in the best interests of the company's creditors, I am obliged to duly investigate the shareholders' position and update the company's records".

Those contacted by Mr Fletcher are urged to respond by April 22nd. It has been estimated the Infinite company has some 650 shareholders holding a total of 22 million shares.

A concerned investor who contacted Not Just Sheep & Rugby commented: "Usually it’s a very simple process. You just look at the confirmation statement, and at any changes that have occurred since the last one was issued. These can be found in the share registry which the company by law is required to keep, and make available to the shareholders and, in this case, the liquidator. What can possibly have gone wrong?"

Mr Frost revealed in a letter to shareholders last year that Omega Infinite's trade creditors were owed some £2.5 million "on top of which there are private Avocet controlled loans in excess of £10 million".

The Avocet chairman has also claimed on two occasions that funds would be put in place so that all creditors would be paid and Omega Infinite (in compulsory liquidation) was to be restored to the companies register.

Last August he wrote following a meeting with Mr Fletcher: "From Dr. Bob Jennings [a fellow Avocet director] and my perspective the main purpose of the Friday meeting was to agree a procedure and methodology of how Omega Infinite Plc could be restored to the Company House Registrar and thereby to set down a procedure which would provide maximum cash benefit to Omega Infinite Plc shareholders.

"Initially, there was a general agreement that the £3 million cash I had secured from Frost family and colleagues would be sufficient to settle Begbies fees along with all necessary creditor payments and statutory interest. Indeed, at first, Mr. Ashleigh Fletcher (liquidator of Omega) got down to basics and the discussion moved to the timing of the £3m transfer to Begbies and how soon thereafter all necessary payments might be made to restore Omega to the Registrar. 

"After a very convivial lunch, I agreed on behalf of Avocet to provide Begbies with some further corporate security plus as much assistance as possible to perform their complex tasks."

Then, in October, Mr Frost declared that new investors in the avocet green fuel concept would be providing the necessary funds to pay off Omega's debts.

In a wide ranging shareholder letter sent out yesterday Mr Frost outlined the values of Avocet Infinite, Avocet Natural Capital and Gennfros Ltd., a recently formed firm with both he and Mr Jennings as life presidents.

According to Mr Frost: "Publicly in December 2018, Avocet Infinite Plc because of its intellectual property was perceived to be worth by willing buyers some £200 to £300 million (or some £10 per ordinary share) – thus from inception to 4 years old, an ordinary one-pound Avocet Infinite Plc share had increased in value by some 1,000%.

" In April 2021, ANC Plc because of its 100% owned subsidiary ‘Avocet IP Limited’ is perceived to be worth (by willing buyers) some £150 to £250 million.

"In April 2021 Gennfros Limited because of its new intellectual property is perceived to be worth (by willing buyers) some £150 to £300 million."

So, despite the Orrdone Farms Limited debacle (Mr Frost claims the failed venture cost £12 million) an investor from 2015 could now expect a capital return of between £12 and £22 for each pound invested.

Mr Frost also quotes Stuart Lucas, of the Asset Match shares trading platform: "Notwithstanding the turmoil, Avocet is my best investment, Ever!".