29 June, 2015

The following is the text of the Chairman's statement made to the Annual General Meeting of the company today.

I would now like to update you on the current position following my letter of 3 June.

Since I became Chairman it has been my priority to achieve agreement on the way forward between all parts of our shareholder base. This has not been an easy process as many in our UK shareholder base have wanted to exit, and for the Company to help them sell their shares for cash. For our substantial Far Eastern shareholders, their priority has been to resolve the issues surrounding our Chinese Joint Venture, Zhongying and ensure that the terms of the joint venture agreement are fully complied with and the share subscription paid up. At this moment there is approximately £3m plus a further £2m in interest outstanding to our joint venture partners under the agreement.

During the same period we were working hard to turn the Company's assets into cash and recover as much funds as possible. During 2014 substantial progress had been made that enabled us to establish proper title to our quoted company assets. These were subsequently sold and converted into cash. Furthermore, there have now been a number of meetings with our Far Eastern shareholders as well as representatives of our joint venture partners in Zhongying. They control 80% of Zhongying and LAC holds the balance of 20%. I am very pleased to report that we have now all agreed to cooperate and to move forward together for the benefit of all the shareholders in Zhongying. The broad outline of what is being proposed is as follows:

  1. The balance of the subscription monies that are due by the Company under its obligations in the joint venture agreement will need to be finalised and paid up in full.
  2. The Company will need to raise funds – possibly from shareholders – to ensure that the Company can meet its obligations under the joint venture agreement.
  3. The Company is working to establish a mechanism to enable shareholders to sell their shares and exit their investment in the Company should they so wish. I know that many of our shareholders have long been requesting a facility that enables them to exit and this would be a very significant development to enable them to do so.
  4. Once the shareholding in Zhongying is fully paid up, we will work with the other shareholders in that company to establish the most effective route by which we can create value for all shareholders.

I hope that my announcement will bring some comfort and relief to all those shareholders who want to quickly divest themselves of their shareholdings, whilst at the same time providing those shareholders that wish to remain, a broad outline of the destination that we are seeking to reach. This has been a very long and difficult process but following the Annual General Meeting today shareholders now have an understanding of the way forward and the choices that will soon be available to them.

David Buchler
29 June 2015