Avocet subsidiary struck off Companies House register

by DOUGLAS SHEPHERD

A business which was part of the Avocet 'disruptive technology' set-up has been dissolved via compulsory strike off by Companies House.

Avocet Infinite Renewables Ltd. had the same two life presidents as Gennfros Ltd., a recently founded company which last week 'awarded' Avocet directors Martin Frost and Dr Bob Jennings honorariums of £24,000 a year each following their appointments to the life presidency.

The Articles of Association for Avocet Infinite Renewables, approved by special resolution in July 2017, allowed for Mr Frost and Dr Jennings to be installed as presidents for life. While the position was to be unpaid each would be "entitled to be reimbursed in respect of any reasonable expenses which he properly incurs in connection with the discharge of his position as a life president of the company".

The objectives of the life presidents at Avocet Infinite Renewables are identical to those set out in the recently published Articles of Gennfros although the management of that company have claimed there will be no connection with Avocet. Instead, Gennfros will rely on a completely new set of intellectual property. 

Those objectives laid out in 2017 were deemed necessary to ensure:

"'Avocet' is seen not just as a fuel additive but is a generic term to encompass and encapsulate a forward movement to a sustainable future;

"'Avocet' remains and develops as a design process grounded in systems thinking of how energy and the law of entropy can prompt a societal shift;

"the 'Avocet' brand name is used in respect of a select number of companies, products and processes which individually and collectively enables man to do more with less;

"'Avocet' is an ecological progenitor to the 'sustainability revolution'; and

"'Avocet' provides mechanisms that work more efficiently with the planet's energy, water and food that positively impact on the world".

The nature of business of the now dissolved Avocet Infinite Renewables is listed at Companies House as "extraction of crude petroleum and natural gas; other treatment of petroleum products; and remediation activities and other waste management services".

The company, incorporated in 2015, had not submitted annual accounts to Companies House since 2017.

In the year to 31 December 2017 it reported a deficit of £211,978, up from £81,800 in 2016. Trade creditors were due £21,021 while the sum of £204,461 was owed to "group undertakings". That figure had risen from £84,294 in 2016.

A note to the accounts explained: "Avocet Infinite Ltd., the company's major creditor, will not require repayment of the inter-company debt within twelve months".

Gennfros life presidents will pick up £2,000 a month

EXCLUSIVE by EWAN LAMB

The intention to pay two life presidents index-linked honoraria of £24,000 a year plus reimbursement of "any reasonable expenses" is revealed in the newly published Articles of Association of chemical manufacturers Gennfros Ltd., likely successors of the Avocet 'disruptive technology' Group.

Beneficiaries of the £2,000-a-month payments will be Martin Frost, currently chairman of Avocet, and fellow director Dr Bob Jennings although neither of them will be involved in running Gennfros whose chief officer is Lancashire-based accountant Paul Newsham.

However, Mr Frost and Dr Jennings have "employee and restrictive contracts in relation to the provision of specialist services and contacts".

Both men have been in charge of Avocet Infinite (now called Omega Infinite and in liquidation) and Avocet Natural Capital with some 650 shareholders and which, according to Mr Frost, could soon be dissolved. The Avocet businesses have so far failed to bring their 'revolutionary' fuel additive to market over a six year period.

The Gennfros articles also disclose that the 'avocet' brand will live on despite recent indications from management that intellectual property currently held by the Avocet organisation would be sold off. It has also been claimed new patent applications would value Gennfros at £150 million.

A document setting out the Gennfros articles of association, accessible via the Companies House website, explains the reasons why the new company requires two life presidents.

It says: "The objectives of the life presidents are to ensure that:

"1 - the brand 'avocet' is seen not just as a fuel additive but is a generic term to encompass and encapsulate a forward movement to a sustainable future.

"2 - the brand 'avocet' remains and develops as a design process grounded in systems thinking of how energy and the law of entropy can prompt a societal shift.

"3 - the 'avocet' brand name is used only in respect of a select number of companies, products and processes which individually and collectively enables man to do more with less.

"4 - the brand 'avocet' is an ecological progenitor to the 'sustainability revolution' and

"5 - the brand 'avocet' provides mechanisms that work more effectively with the planet's energy, water and food that positively impact on the world".

Despite such apparently high profile/key roles the life presidents will not be part of Board meetings.

In a series of shareholder letters over recent months, Mr Frost, in his role as chairman of Avocet Natural Capital (ANC), repeatedly warned of legal proceedings against those investors who forwarded his correspondence to third parties, including bloggers. There were also claims that his emails were fitted with tracking devices to identify miscreants who were sharing confidential information.

Eventually ANC management intimated that the company was unable to function, hence the need to set up Gennfros which will be protected by a non-disclosure agreement (NDA).

The Gennfros articles state at paragraph 101: "Given that the essence of the company is the formulation and commercialisation of intellectual property it is essential that this is kept secret. It is a condition of share and loan note ownership that complete secrecy is maintained.

Should a shareholder or loan note holder be found in breach of the company's NDA then such shareholding or loan notes they hold are forfeit and such forfeiture will be automatic in advance of any damages that they become liable to".

But if any investor wants to obtain a copy of the NDA they must request it from the company secretary 'upon 14 days notice'. 

Omega's revival back on the agenda

by EWAN LAMB 

Shareholders in the 'disruptive technology' Avocet group were told in early August that funds had been secured to restore the debt-ridden former parent company Omega Infinite PLC to the Companies Register.

The news followed a private meeting between Avocet chairman Martin Frost and Omega's liquidators Begbies Traynor at which an indication had been given that the £3 million would come from the Frost family and colleagues. The cash would also allow accountants Ryecroft Glenton, former auditors of Omega, to produce overdue company accounts for 2018 and 2019 ' hopefully by the end of September 2020'.

But so far those accounts remain overdue while Mr Frost's promise at the time of legal action against the administrators of another insolvent company, Orrdone Farms Ltd. has yet to materialise.

Now a virtually identical scenario has emerged from another 'very productive' meeting between representatives of Omega's successor Gennfros Ltd. and Begbies Traynor on Thursday of last week.

Though not a director of Gennfros, Mr Frost told potential investors in the new company at the weekend that the Begbies Traynor meeting had been greatly assisted by "the promise next week of a £2.1 million share convertible loan from our new investors."

Such a sum will be small beer for the unidentified investors in Avocet's 'revolutionary' fuel additive for according to Mr Frost they are willing to inject £750 million into the business.

In his report on Thursday's proceedings Mr Frost revealed the loan meant:"Gennfros agreed to put Begbies into funds so that the Omega Infinite Plc restoration process to the Company House Register can begin; pay off certain Omega creditors especially AFS Ventures Plc (a company controlled by Mr Frost which has been in liquidation since 2015); pay Ryecroft Glenton to conclude the 2018 and 2019 audits for Omega & Orrdone; and put Gennfros Limited, and Avocet legal teams into funds so that litigation can proceed, particularly against the Orrdone Farms Limited Administrators."

In a shareholder letter to Avocet Natural Capital Ltd.'s investors in August Mr Frost provided an account of a meeting and 'convivial lunch' with Begbies Traynor, the Omega liquidators, in York.

He wrote: "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 £3 million transfer to Begbies and how soon thereafter all necessary payments might be made to restore Omega to the Registrar."

 

"I then explained to Begbies that measures were in hand to sue these people once Avocet had the benefit of Ryecrofts [they resigned as auditors for non-payment of professional fees] accounts for Omega and Orrdone for the years ending 2018 and 2019.

"When asked as to timing and upon the grounds the legal actions would take I agreed to (a) provide the twin company accounts prepared by Ryecrofts hopefully before the end of September 2020 and (b) provide (subject to counsel’s agreement) copies of relevant legal opinions as and when such fell due. I was further annoyed when Begbies indicated that they thought that the Orrdone Administrators might seek to challenge Ryecrofts 2017 audited accounts as it appears that the Administrators have been fed spurious misinformation.

"I advised Begbies that with the benefit of the current fact find and Ryecroft’s accounts I would expect serious legal action to commence no later than October 2020."

Following Mr Frost's disclosures regarding last week's meeting with Begbies Traynor we contacted the liquidator's public relations representatives.

Not Just Sheep & Rugby offered an opportunity for the insolvency practitioners to comment on Mr Frost's points. We also repeated an earlier request for a list of creditors for Omega Infinite and asked when a report to creditors was to be produced and submitted to Companies House

A Begbies Traynor spokesperson said: “In line with statutory requirements, an annual report to creditors will be lodged with Companies House within two months of the first anniversary of our appointment as Joint Liquidators on 28 April 2020 and will contain all of the information that we are required to provide to creditors."

The only public indication as to the level of Omega's indebtedness has been given by Mr Frost himself.

In February 2020, some two months before a Winding Up Order was obtained from the courts, Mr Frost informed Omega investors - 650 of them held 22 million shares at that time -  of management's intention to go down the insolvency route.

Mr Frost stated: "Omega Infinite Plc is to go into some form of insolvency. A winding up petition initiated by lawyers Fieldfisher for some £400,000 is to be heard in London; likely now to support this petition are lawyers Womble Bond Dickinson for another some £600,000 along with various other creditors for £300,000. The total trade creditor indebtedness of Omega Infinite Plc is likely to reach some £2.5 million, and on top of which there are private Avocet controlled loans in excess of £10 million."

 

Transparency champion accused of "breaching confidentiality"

 by DOUG COLLIE

A lifelong advocate of local government transparency is facing a Standards Commission hearing for allegedly sharing confidential information with the public in his role as...A COUNCILLOR.

Hawick-born John Ross Scott, with distinguished careers in both journalism and public service, has apparently incurred the wrath of 15 fellow members of Orkney Islands Council (OIC) who submitted a complaint to conduct watchdog the Standards Commission for Scotland earlier this year.

Mr Scott is a former leader of Scottish Borders Council and served as chairman of the Orkney health authority for eight years after leaving the Borders in 2003. He is credited for introducing a much more open regime while at the health board.

As a newspaperman John, affectionately known in the Borders as 'JR', was chief reporter at the Southern Reporter for 16 years during which time the title picked up prestigious awards. He also occupied the editor's chair at the Hawick News for a time.

His CV also shows he was elected a Roxburgh District Councillor from 1980-85 representing Jedburgh South then won a by-election in Hawick West for a seat on Borders Regional Council (1985-1996). Served on that council as Chairman of Planning and Development and Chairman of Roads and Transportation then was elected to Scottish Borders Council (1995-2003) where he was Chairman of Technical Services then Council Leader.

He also served as Honorary Provost of Hawick from 1999-2002.

Following his move to Orkney Mr Scott was appointed editor of the newly formed Orkney Today newspaper and later became freelance editor of Living Orkney magazine, a post he still holds. He was elected as a councillor for the Kirkwall East ward of OIC at the 2017 council elections.

Not Just Sheep & Rugby understands that since Mr Scott became a councillor - his campaign slogan was 'add spice to the mix' - he has been trying to foster a greater degree of openness within Orkney council.

After all, the authority's website declares: "OPEN GOVERNMENT - We are well aware that local authorities can be seen by some as remote, mysterious and bound up in red tape. But the principle of open government is important to us."

But allies of Mr Scott say his attempts have been frustrated by the group of senior members who 'run the show'. Among the initiatives shot down in flames was an attempt to introduce a leaders' question and answer session, and a bid to give young people a greater say in council affairs.

According to The Orcadian newspaper which covered the controversy in its latest issue Mr Scott is one of the most 'visible' Orkney councillors.

The paper tells how news broke in May that Councillor Scott had been excluded from weekly briefings. He first became aware of concerns being raised by fellow members when he was accidentally copied into a group email.

The complaint to the Standards Commission is believed to centre on a Facebook post by Mr Scott in March in which he posted information in the wake of a private meeting relating to the breaking Covid-19 pandemic.

"A group of councillors had organised a meeting to discuss the Facebook post Councillor Scott had made but he was not invited to attend", reports The Orcadian.

OIC is populated by 18 Independent councillors (including Mr Scott), two members of the Orkney Manifesto Group and a solitary Scottish Green. The Orcadian suggests the two 'political' groups at OIC regard Mr Scott as their "opposition".

Not Just Sheep & Rugby contacted Mr Scott for comment but he explained he was not able to talk publicly about the forthcoming hearing at the Standards Commission. He hoped everything would become clear after that hearing and indicated that he had received numerous messages of support since the story broke locally.

The Commission website has the hearing of Mr Scott's case listed for January 18th 2021.

Sanctions available to the watchdog range from dismissal of the complaint up to disqualification as a councillor for up to five years. In between are Censure (a reprimand) and Suspension, involving a ban from attending council meetings for the duration of the 'sentence'.

Gennfros co-owner could be dissolved by Companies registrar

by DOUGLAS SHEPHERD

Loch Lomond Heritage Ltd., the company which holds a 50% stake in the business destined to replace the Avocet 'disruptive technology' group faces the threat of being struck off the UK Register of Companies, according to a notice posted on the Companies House website.

It was recently revealed that Loch Lomond Heritage, controlled by Avocet chairman Martin Frost holds five million one penny shares in Gennfros Ltd. which was only incorporated at the end of September.

The other half of the shareholding in Gennfros is now in the hands of Chemical Technology Services Ltd, of Hutton Rudby, Yarm, Teesside. One of the two directors of that business, formed in 2006, is Dr James R Jennings.

He also sits on the board of various firms bearing the Avocet name, in particular Avocet Natural Capital [ANC] whose 650 investors have, between them, a reported 50 million shares. Mr Frost has announced the intention to dissolve ANC before long. 

Selected Avocet shareholders are currently being offered 'gift' shares in Gennfros while others have faced the indignity of being blackballed by Avocet's Board before being excluded from the giveaway process. They include 'dissidents' who have cast doubts on Avocet's ability to develop and market a revolutionary fuel which, according to Mr Frost, will render the electric car obsolete.

But a so-called Gazette Notice, issued on November 17th has the capability to render Loch Lomond Heritage Ltd. obsolete some two months from now.

The notice says: "The Registrar of Companies gives notice that, unless cause is shown to the contrary, the Company will be struck off the register and dissolved not less than two months from the date shown. Upon the company's dissolution all property and rights vested in, or held in trust for, the company are deemed to be bona vacantia (goods without an apparent owner) and will belong to the Crown".

There is no reason given for the action in the notice. But Loch Lomond Heritage's annual accounts up to June 30th 2019 should have been submitted to Companies House by June 30th 2020 which means the filing of finances is by now 142 days overdue.

Companies House literature on late filings stipulates: "Failure to file confirmation statements, annual returns or accounts is a criminal offence which can result in directors being fined personally in the criminal courts. Failure to pay the late filing penalty can result in enforcement proceedings."

Businesses face financial penalty fees for late filing of their accounts with private companies charged £750 and public companies £3,000 once they are more than three months beyond the deadline.

Meanwhile, in a Gennfros communication circulated by Mr Frost earlier today he declares: "I am appalled at the mischievous (sic) of some cyber warriors who have unfairly criticized Gennfros Limited’s share option gift.

"Plainly speaking: Loch Lomond Heritage Limited and the Chemical Technology Services Limited have physically purchased their shareholdings for £50,000 pounds each equating to a £0.01 pound per share. This purchase allows both Loch Lomond Heritage Limited and the Chemical Technology Services Limited to vote as members in the affairs of Gennfros Limited - if either company sells any of this shareholding there is NO further payment to Gennfros Limited."

Then Mr Frost goes on to write: "I am similarly annoyed by some ANC Plc shareholders who have already identified themselves as naysayers and keyboard warriors filibustering the timing of the Gennfros Limited gift process with Mr. Archie Garner. 

"Archie in a previous existence, as some of you know, was a premier RSM in the British Army so he is accurately acting according to his brief. Unfortunately, when conveying Gennfros Limited wishes, Archie has been the subject of much unwarranted abuse – and a 2-5 minute exercise has often taken 20 minutes or more.

"Consequently, the Gennfros Limited gift process is taking a week longer than budgeted which in turn delays all other matters by a week. Though not amused by this delay Gennfros Limited is using the extra time to tighten up upon its intellectual property and ensure that naysayers are appropriately dealt with.".

It has been claimed a collection of Gennfros patents will be worth £150 million, a claim challenged and rubbished by sceptics who warn Avocet intellectual property (IP) is about to be transferred to Gennfros without shareholders' permission.

But Mr Frost states: "Gennfros Limited’s intellectual property is new – it exists and has been independently verified by our new investors – and furthermore, there are significant and important step advances.

"That said, Gennfros Limited’s new IP does not make the IP housed in Avocet IP Limited redundant and as prior stated Avocet IP Limited will realize its IP for the benefit of first its creditors and then ANC Plc shareholders as a body."

Gennfros 'asset transfer' questioned by investors

 by DOUG COLLIE

The executive director of Gennfros Limited, the company set up to take forward the Avocet group's "disruptive technology" has circulated a timetable setting out how the fledgling replacement business will be developed.

But no sooner had Paul Newsham, a Lancashire-based chartered accountant and sole director of Glennfros issued correspondence to potential investors than shareholders in Avocet appeared to challenge any proposed transfer of assets between the firms.

Mr Newsham, who has been appointed to sit on the board of a number of Avocet affiliated companies over the course of this year, also warned of legal proceedings in the English courts against a number of individuals named Orr, a Berwickshire farming family.

Avocet chairman Martin Frost and fellow director Dr Bob Jennings had indicated they would not be directors of Gennfros although shares are held by a Frost family company called Loch Lomond Heritage Ltd. Mr Frost has also ruled that 'dissident' Avocet shareholders will not be offered a stake in Gennfros, and Avocet management has taken the unusual decision to 'blackball' a number of its own shareholders.

Now Mr Newsham, in his first public statement as head of Gennfros, says in a 'Dear Colleague' letter: "Gennfros Limited is a private English limited liability company with now an ‘authorized’ share capital of 50 million one penny shares alongside £10 million pounds of redeemable, interest free and unsecured loan stock. 

"Gennfros Limited’s worth is focused on families of newly created intellectual property with a current anticipated net worth more than £150 million pounds. An US based multinational is in advanced talks to purchase 14 million of the above out of the 50 million one penny shares at £3 per share – some 4 million direct from Gennfros Limited with a further 10 million from proposed Gennfros Limited shareholders."

And Mr Newsham continues: "It has taken an additional week to formulate ‘injunctive relief’ against Mrs. Aileen Orr, Andrew Orr, and John Orr’s false claims that Avocet IP Limited and separately Gennfros Limited’s IP [Intellectual Property] has their origin with Andrew Orr & John Orr – it is now hoped that interim injunctions will be obtained in the English High Court this coming week. Once, this remaining IP issue is satisfied the new investors will publicly make their purchase offer to those Gennfros Limited shareholders with a ‘gift option’."

Potential investors are then informed that the planned itinerary For Gennfros Ltd is to secure an interim injunction against IP 'transgressors'; lodge the company's new Articles of Association at Companies House; submit a Confirmation Statement; and then new investors to purchase Gennfros shares from the company and shareholders.

However, an Avocet shareholder who has criticised the group for failing to bring any products to the market since its formation in 2014 told Not Just Sheep & Rugby: "I question the ability of Gennfros and/or Avocet officers to legally transfer Avocet assets to a new company without consent from shareholders. It is a fact that no new patents have been filed and plainly obvious that existing ANC PLC shareholders are being discriminated against."

Gennfros has also produced a document outlining how the methanol-based fuel additive, previously promoted by the Avocet Group can be manufactured together with a list of its merits.

But one observer commented: "Based on the methanol write up, it appears the Gennfros breakthrough technology is almost entirely made up of Avocet paid-for IP."

At the same time a poster on the Avocet Shareholders' Forum wrote: "In the Methanol write-up, I saw no sign of the “some forty plus filed and to be filed new patents” quoted by Martin Frost on October 29, 2020 that Frost promised would be the foundation of Gennfros.

"Instead, despite his commitment that 'Gennfros Limited has not even used the ‘avocet’ name let alone any intellectual property', Frost’s write-up contains numerous references to existing Avocet IP, now very interestingly renamed as Gennfros/avocet. It would appear that the Avocet shareholders already own all or a significant part of the IP that Gennfros is being based on. In my opinion, we are being sold mutton dressed up as lamb."

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Rich pickings from council's £11 million PFI payment

EXCLUSIVE by DOUG COLLIE

The company running the controversial Private Finance Initiative [PFI] project which built three Scottish Borders secondary schools recorded a £1.1 million operating profit last year and sent a £380,000 dividend to its parent group based in Luxembourg.

These are among the financial statistics contained in the annual accounts of the Scottish Borders Education Partnership Ltd. (SBEP), a business with no employees and which shares a registered address in Maidenhead, Berkshire with a multitude of similar PFI ventures.

In 2020/21 Scottish Borders Council will pay £11.457 million towards the cost of funding and maintaining its secondary schools in Eyemouth, Duns and Earlston which were completed in 2009. The deal with SBEP runs until November 2038, and according to the council's latest annual accounts a further £260 million worth of payments is outstanding.

The £11.457 million is made up of  £5.401 million for services, £3.226 million goes towards reimbursement of capital expenditure and £2.830 million is needed to cover interest payments. The total paid in 2019/20 was £10.999 million. Council figures also show further interest payments over the lifetime of the agreement will come to £42.271 million.

Council pay-outs for PFI have escalated sharply over the last five years. Audited accounts for 2014/15 showed the total bill was £8.296 million comprising £5.520 million for repayment of liability and service charges plus £2.776 million in interest charges. It means this year's costs are 38% higher than in 2014/15.

SBEP sub-contracts the maintenance and operation of all three schools to Amey. That 30 year deal, struck in 2008 was worth £58 million to the company. Amey was part of a consortium which persuaded councillors to sanction the expensive arrangements with German PFI specialists Bilfinger Berger BOT as lead promoter and sponsor, together with Ulster-based Graham Construction.

Amey is responsible for facilities management of the three schools including buildings and grounds maintenance, security, caretaking and cleaning.

The massive contract provides a regular income stream to SBEP Ltd subject to deductions for service shortfalls or the unavailability of the school buildings.

The newly published accounts for the partnership show an operating profit of £1.111 million on turnover of £3.837 million. Administration expenses totalled just £17,000. The overall profit was up from £945,000 in 2018. SBEP directors Albert Naafs and Frank Schramm were able to approve and pay dividends of £380,000 (2018 £259,000).

Looking to the future the report says: "The project continues to perform generally in line with the modelled expectations and management of the scheme both logistically and financially remains under control. The directors remain confident that the company will maintain the current level of performance and keep meeting the obligations under the contract".

Among other facts recorded in the report are cash at bank and in hand £4.192 million (up from £3.727 million at the end of 2018) and "interest is imputed on the finance debtor (Scottish Borders Council) using an asset specific interest rate of 5.27%".

Meanwhile SBEP has loans totalling £68.330 million with Prudential Annuities Ltd and Prudential Retirement Income Ltd with a 2.604% index-linked coupon.

All of the share capital in Scottish Borders Education Partnership is held by Scottish Borders Education Partnership (Holdings) Ltd., also registered at the same Maidenhead address. In turn 100% of the shares in the holding company lie with BBGI Investments S.C.A., an indirect and wholly owned subsidiary of BBGI SICAV S.A., both registered and domiciled in Luxembourg.

The BBGI conglomerate control a significant number of PFI projects throughout the United Kingdom.

A report prepared for the Scottish Parliament in 2018 calculated the annual amount local authorities in Scotland pay to various PFI operators for the use of school buildings constructed under the system totalled £434 million, equal to almost ten per cent of the education budget.