Trakm8 Holdings Public Limited Company

Transcription

1 THIS NOTICE OF MEETING IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION. If you are in any doubt as to the contents of this document and/or the action you should take, you are recommended to seek personal financial advice from your bank manager, stockbroker, solicitor, accountant or other independent financial adviser authorised under the Financial Services and Markets Act If you have sold or transferred all of your shares in the Company, please send this document and all accompanying documents to the purchaser or transferee, or to the stockbroker, bank or other agent through whom the transfer was effected so that they can be passed on to the person who now owns the shares. Trakm8 Holdings Public Limited Company (Registered in England and Wales with company number ) Proposed Related Party Transactions and Notice of General Meeting Whether or not you intend to attend the General Meeting, you are encouraged to complete and return the enclosed Proxy Form in accordance with the instructions printed on the form. The Proxy Form must be received by our registrar as soon as possible and by no later than 9.00 a.m. on 29 May Arden Partners, which is regulated by the FCA in the UK, is acting solely for the Company in relation to the matters set out in this document and nobody else and will not be responsible to anyone other than the Company for providing the protections afforded to clients of Arden Partners nor for providing advice in relation to the matters set out in this document. 1

2 Definitions "Act" means the Companies Act "AIM Rules" "Arden Partners" "Board" or "Directors" "Company" "CREST" "CREST Manual" "Directors Deed of Release" "Financial Conduct Authority" or "FCA" "Form of Proxy" "Former Director" "FSMA" "General Meeting" "HMRC" "Independent Director" means the AIM Rules for Companies published by the London Stock Exchange, as amended. means Arden Partners plc. means the board of directors of the Company. means Trakm8 Holdings Public Limited Company. means the paperless settlement procedure operated by Euroclear enabling system securities to be evidenced otherwise than by certificates and transferred otherwise than by written instrument. means the rules governing the operation of CREST as published by Euroclear. means a deed of release by which the Company waives any rights to make claims against the Former Director and Directors in respect of the Relevant Distribution. means the Financial Conduct Authority of the United Kingdom. means the form of proxy enclosed with this document for use by shareholders in connection with the General Meeting. means James Hedges. means the Financial Services and Markets Act 2000, as amended. means the general meeting of the Company convened by the Notice of General Meeting, to be held at 4 Roman Park, Roman Way, Coleshill, Birmingham West Midlands B46 1HG on 31 May 2018 at 9.00 a.m. means Her Majesty s Revenue & Customs. means Jon Furber. "IFRS" means the International Financial Reporting Standards promulgated by the International Accounting Standards Board (which includes standards and interpretations approved by the International Accounting Standards Board and International Accounting Standards issued under previous constitutions), together with its pronouncements thereon from time to time, as adopted by the European Union. "Notice of General Meeting" "Ordinary Shares" means the notice convening the Meeting set out at page 9 of this document. means ordinary shares in the capital of the Company. 2

3 "Proxy Form" "Recipient Shareholder" "Relevant Distribution" "Shareholder" "Shareholders Deed of Release" means the form of proxy appointment which accompanies this document for use in connection with the Meeting. means a current or former shareholder of the Company who appeared on the register of members on the record date for the Relevant Distribution. means the aggregate dividend of 649,270 paid by the Company on 13 September means a shareholder in the capital of the Company. means a deed of release in favour of all Recipient Shareholders from any and all claims which the Company has or may have in respect of the payment of the Relevant Distribution. 3

4 PART I LETTER FROM THE CHAIRMAN Trakm8 Holdings Public Limited Company (Registered in England and Wales with company number ) Directors: John Watkins (Executive Chairman) Keith Evans (Non-Executive Deputy Chairman) Jon Furber (Group Finance Director) Tim Cowley (Strategy Director) Matt Cowley (Big Data Director) Sean Morris (Automotive Business Unit Director) Mark Watkins (Chief Operating Officer) Bill Duffy (Non-Executive Director) Registered Office: 4 Roman Park Roman Way Coleshill Birmingham B46 1HG 13 April 2018 To all Shareholders Dear Shareholder 1. Introduction The Board has become aware of a technical issue in respect of the payment by the Company of the dividend in The Companies Act 2006 provides that a public company may pay a dividend out of its distributable profits as shown in the last accounts circulated to members or, if interim accounts are used, those that have been filed at Companies House. The accounts of the Company for the year ended 31 March 2016 did not show sufficient distributable reserves to permit the payment of the Relevant Distribution. Interim accounts prepared did show sufficient reserves to permit the payment of the Relevant Distribution, however due to an administrative oversight the Interim accounts were not filed at Companies House. Therefore, regrettably, the Relevant Distribution was made otherwise than in accordance with the Act. The purpose of this document is to convene a General Meeting to propose the Resolution, which will, if passed, give the Board authority to enter the deeds of release described in Part II of this document and put all potentially affected parties so far as possible in the position in which they were always intended to be had the Relevant Distribution been made in accordance with the requirements of the Act. The Company has been advised that, as a consequence of the Relevant Distribution having been made otherwise than in accordance with the Act, it may have claims against past and present shareholders who were recipients of the Relevant Distribution and against persons who were directors of the Company at the time of payment of the Relevant Distribution. It is therefore proposed that the Company enter into the Shareholders Deed of Release and the Directors Deed of Release. The consequence of the entry into these deeds by the Company is that the Company will be unable to make any claims against: (a) (b) the Recipient Shareholders; and the Directors and Former Directors, in each case in respect of the payment of the Relevant Distribution otherwise than in accordance with the Act. The entry by the Company into the Shareholders' Deed of Release constitutes a related party transaction (as defined in the AIM Rules). This is because John Watkins, together with his associated parties, holds over 10% of the Company's share capital and is therefore deemed to be a related party for the purposes of the AIM Rules. In addition, the entry by the Company 4

5 into the Directors' Deed of Release will also constitute a related party transaction with respect to the Directors. Further details and an explanation of the business of the General Meeting and the related party transaction are set out in Part II of this document. 2. Notice of General Meeting Enclosed in this document is a notice of General Meeting of the Company which will be held at 4 Roman Park, Roman Way, Coleshill, Birmingham West Midlands B46 1HG at 9.00 a.m. on 31 May The Notice can be found on page 9 of this document. 3. Proxy Voting Whether or not you will be attending the General Meeting, I would urge you to complete, sign and return the accompanying Form of Proxy to the Company s registrars, Neville Registrars as soon as possible and, in any event, so as to arrive by no later than 9.00 a.m. on 29 May Alternatively, you can register your proxy electronically in accordance with the instructions on the Form of Proxy. Further details are given in the notes to the Notice set out on pages 9 and 10 of this document. Completion and return of the Form of Proxy will not preclude shareholders from attending and voting in person at the General Meeting, should they so wish. The attention of corporate shareholders wishing to appoint more than one corporate representative is drawn to note 7 to the Notice set out on page 10 of this document. 4. Recommendation Given the interest of the Board in the Resolution: (a) (b) (c) the Board as a whole has not considered the Resolution and cannot recommend that Shareholders vote in favour of the Resolution; Jon Furber, who joined the Company after the payment of the Relevant Distribution, is the sole Independent Director. Having consulted with Arden Partners, as nominated adviser to the Company, the Independent Director considers that the Resolution and entry into the Shareholders' Deed of Release and the Directors' Deed of Release, are fair and reasonable insofar as the Shareholders are concerned. In providing advice to the Independent Director, Arden Partners has taken into account the Independent Director's commercial assessments; the Independent Director considers that the Resolution and entry into the Shareholders' Deed of Release and the Directors' Deed of Release are in the best interests of the Company and Shareholders as a whole. Accordingly, the Independent Director recommends that Shareholders vote in favour of the Resolution, as he intends to do in respect of his own beneficial shareholding, which amount to 28,321 Ordinary Shares (representing 0.08 per cent. of the issued share capital of the Company at the date of this document). The Board has taken steps to ensure that, in future, the issues referred to in this document do not arise in relation to the payment of dividends. We are grateful for shareholders understanding in respect of the issues set out in this document. On behalf of the Board, thank you for your continued support of the Company. Yours faithfully John Watkins Chairman 5

6 PART II BUSINESS OF THE GENERAL MEETING 1. The consequences of Relevant Distribution having been made otherwise than in accordance with the Act The Company has been advised that, as a consequence of the Relevant Distribution having been made otherwise than in accordance with the Act it may have claims against past and present shareholders who were recipients of the Relevant Distribution and against persons who were directors of the Company at the time of payment of the Relevant Distribution. The Board notes, however, that the Company has no intention of bringing any such claims. 2. Shareholder Resolution In order to remedy the potential consequences of the Relevant Distribution having been made otherwise than in accordance with the Act, and to put all potentially affected parties so far as possible in the position in which they were always intended to be had the Relevant Distribution been made in accordance with the requirements of the Act, the Company is proposing the Resolution, the full text of which is set out in the Notice starting on page 9 of this document. If passed, the effect of the Resolution, which will be proposed as a special resolution, will be to: ratify the Relevant Distribution and confirm the appropriation of the profits of the Company in the year ended 31 March 2017 for the purposes of the Relevant Distribution; waive any and all claims which the Company has or may have in respect of the payment of the Relevant Distribution against its Recipient Shareholders (or the personal representatives and their successors in title of the estate of any deceased Recipient Shareholders), such waiver to be effected by way of the entry by the Company into the Shareholders Deed of Release; and waive any and all claims which the Company may have against its Directors and Former Directors, such waiver to be effected by way of the entry by the Company into the Directors Deed of Release. The approach that the Company is proposing by way of the Resolution is consistent with the approach taken by other UK listed companies that have, similarly, made corporate distributions otherwise than in accordance with the Act. Should the Resolution not be passed by Shareholders, there is a theoretical risk that the Company is entitled to make claims against past and present shareholders who were recipients of the Relevant Distribution. 3. The ratification of the Relevant Distribution, the confirmation of the appropriation of the Company's profits and the Shareholders' Deed of Release The approach that the Company is proposing involves the ratification of the Relevant Distribution and the confirmation of the appropriation of the distributable profits of the Company for the purposes of the Relevant Distribution. As a matter of common law, it is necessary for this ratification and confirmation to be approved by shareholders. The Company has been advised that it is also preferable for shareholders to approve the Company s entry into the Shareholders Deed of Release, since the release of those past and present shareholders who appeared on the register of members on the record date for the Relevant Distribution (or their personal representatives (and their successors in title) if they are deceased) from any and all claims which the Company has or may have in respect of the payment of the Relevant Distribution will, insofar as those persons remain shareholders of the Company, comprise a shareholder distribution. The proposed ratification of the Relevant Distribution, the confirmation of the appropriation of the Company s distributable profits for the purposes of the Relevant Distribution and the entry by the Company into the Shareholders Deed of Release will not, however, have any effect on the Company s financial position. This is because the aggregate amount of the Relevant Distribution is equal to and offset by the release of each Recipient Shareholder from the liability to repay the amount already paid, and the Company will not be required to make any further payments to shareholders in respect of the Relevant Distribution. 6

7 In addition, the Company has not recorded or disclosed the potential right to make claims against Recipient Shareholders as an asset or a contingent asset in its financial statements. Under the Company s IFRS accounting policies, it could only record such a right as an asset when an inflow of economic benefits in favour of the Company as a result of such claim or claims being brought was virtually certain. The value of any economic benefit which the Company may derive from bringing claims against the Recipient Shareholders is uncertain (and, in any case, incapable of reliable estimation) on the basis that it may be possible for the Recipient Shareholders to establish defences to any such claims and there can be no certainty as to the amounts which could be recovered by the Company. In addition, under IFRS, a contingent asset is required to be disclosed only when an inflow of economic benefits in favour of the Company is probable. The Directors have concluded that any inflow of economic benefits as a result of such claims is less than probable. Accordingly, the Company s entry into the Shareholders Deed of Release will not result in any decrease in the Company s net assets or the level of its distributable reserves. 4. The Directors' Deed of Release Under the Company s articles of association, it is necessary for shareholders to approve the Company s waiver of any rights of the Company to make claims against the Directors and the Former Director in respect of the Relevant Distribution, since the Board would itself have a potential conflict of interest in approving such a waiver. This is because the members of the Board are named as beneficiaries of the waiver. The entry by the Company into the Directors Deed of Release will not have any effect on the Company s financial position because, as with the position in relation to the Relevant Distribution and potential claims against past and present shareholders, the Company has not recorded or disclosed its right potentially to make claims against past and present directors in respect of the Relevant Distribution as an asset or contingent asset of the Company. Again, under the Company s IFRS accounting policies, it could only record such a right as an asset when an inflow of economic benefits in favour of the Company as a result of such claim or claims being brought was virtually certain. The value of any economic benefit which the Company may derive from bringing claims against past and present directors is uncertain (and, in any case, incapable of reliable estimation) on the basis that past and present directors would be entitled to seek the court s relief against such claims and there can be no certainty as to the amounts (if any) which could be recovered by the Company. In addition, under IFRS, a contingent asset is required to be disclosed only when an inflow of economic benefits in favour of the Company is probable. The directors of the Company have concluded that any inflow of economic benefits as a result of such claims is less than probable. Therefore, the Company s entry into the Directors Deed of Release does not involve the disposition of any recognised asset or contingent asset by the Company in favour of past or present directors. 7

8 Trakm8 Holdings Public Limited Company (Registered in England and Wales with company number ) Notice of General Meeting Notice is hereby given that a general meeting (the "Meeting") of Trakm8 Holdings Public Limited Company (the "Company") will be held at 4 Roman Park, Roman Way, Coleshill, Birmingham West Midlands B46 1HG on 31 May 2018 at 9.00 a.m. for the purpose of considering and, if thought fit, passing the following resolution, which will be proposed as a special resolution: 1. THAT: 1.1 the Company hereby ratifies and confirms the payment of 2.0 pence per Ordinary Share by way of final dividend paid by the Company on 13 September 2016 (the "Relevant Distribution") and the appropriation, for the purposes of the preparation of the Company's audited financial statements for the financial year ended 31 March 2017, of the distributable profits of the Company to the payment of the Relevant Distribution and the resulting entry for the distributable profits of the Company in such financial statements; 1.2 any and all claims which the Company has or may have arising out of or in connection with the payment of the Relevant Distribution against its shareholders who appeared on the register of shareholders on the record date for the Relevant Distribution (or the personal representatives and their successors in title (as appropriate) of a shareholder s estate if he or she is deceased) be waived and released pursuant to a deed of release in favour of such shareholders (or the personal representatives and their successors in title (as appropriate) of a shareholder s estate if he or she is deceased), to be entered into by the Company in the form produced to the General Meeting and initialled by the Chairman for the purposes of identification, and any Director in the presence of a witness, any two directors of the Company (each, a "Director") or any Director and the Company Secretary be authorised to execute the same as a Deed Poll for and on behalf of the Company (the "Shareholders' Deed of Release"); and 1.3 any and all claims which the Company has or may have against each of its Directors and the former director of the Company who was on the board at the time of approval of the Relevant Distribution ("Former Director"), arising out of or in connection with the approval, declaration or payment of the Relevant Distribution be waived and released pursuant to a deed of release in favour of each of such Directors and Former Director, to be entered into by the Company in the form produced to the General Meeting and initialled by the Chairman for purposes of identification and any Director in the presence of a witness, any two Directors or any Director and the Company Secretary be authorised to execute the same as a Deed Poll for and on behalf of the Company (the "Directors' Deed of Release"). Dated 13 April 2018 By order of the Board Registered office: 4 Roman Park Roman Way Coleshill Birmingham West Midlands B46 1HG Jon Furber Company Secretary 8

9 Notes: 1. Pursuant to Regulation 41 of the Uncertificated Securities Regulations 2001 (as amended), only those members registered in the register of members of the Company at close of business on 29 May 2018 shall be entitled to attend and vote at the Meeting in respect of the number of shares registered in their name at that time. Any changes to the register of members after such time shall be disregarded in determining the rights of any person to attend or vote at the Meeting. 2. If you wish to attend the Meeting in person, please bring photo ID. 3. A member who is entitled to attend, speak and vote at the Meeting may appoint a proxy to attend, speak and vote instead of him. A member may appoint more than one proxy provided each proxy is appointed to exercise rights attached to different shares (so a member must have more than one share to be able to appoint more than one proxy). A proxy need not be a member of the Company but must attend the Meeting in order to represent you. A proxy must vote in accordance with any instructions given by the member by whom the proxy is appointed. Appointing a proxy will not prevent a member from attending in person and voting at the Meeting (although voting in person at the Meeting will terminate the proxy appointment). A proxy form is enclosed. The notes to the proxy form include instructions on how to appoint the Chairman of the Meeting or another person as a proxy. You can only appoint a proxy using the procedures set out in these Notes and in the notes to the proxy form. 4. To be valid, a proxy form, and the original or duly certified copy of the power of attorney or other authority (if any) should reach the Company s registrar by no later than 9.00 a.m. on 29 May The notes to the proxy form include instructions on how to appoint a proxy by using the CREST proxy appointment service. 6. In the case of joint holders of shares, the vote of the first named in the register of members who tenders a vote, whether in person or by proxy, shall be accepted to the exclusion of the votes of other joint holders. 7. A member that is a company or other organisation not having a physical presence cannot attend in person but can appoint someone to represent it. This can be done in one of two ways: Either by the appointment of a proxy (described in Notes 3 to 5 above) or of a corporate representative. Members considering the appointment of a corporate representative should check their own legal position, the Company's articles of association and the relevant provision of the Companies Act Copies of the Shareholders' Deed of Release and the Directors' Deed of Release will be available for inspection at the registered office of the company during usual business hours on any weekday (Saturday, Sunday and public holidays excluded) from the date of this notice until the Meeting and will be available for inspection at the place of the Meeting for at least 15 minutes prior to and during the Meeting. 9