Posting of AGM Notice

Impellam Group plc

02 June 2023

 

NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, DIRECTLY OR INDIRECTLY, IN WHOLE OR IN PART IN, INTO OR FROM ANY JURISDICTION WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OR REGULATIONS OF THAT JURISDICTION

FOR IMMEDIATE RELEASE

2 June 2023

Impellam Group plc

("Impellam" or the "Company" or the "Group")

Posting of AGM Notice

Impellam Group plc (AIM: IPEL) announces that it has today posted notice of its 2023 Annual General Meeting ("AGM") and associated Form of Proxy to shareholders.

The AGM will be held at 3.00pm on Tuesday 27 June 2023 at the offices of Impellam Group plc, 107-112 Leadenhall Street, London EC3A 4AF.

Notice of the AGM is now available to view or download in pdf format from the Company's corporate website at www.impellam.com.

Further details on the AGM and the business to be conducted

In addition to the more usual business at the AGM, the Notice of AGM contains additional special resolutions in connection with the payment of the January 2023 Dividend and subsequent Share Repurchases, as defined below, by the Company where certain technical requirements of the Companies Act 2006 ("CA 2006") were not complied with. An explanation of the background to this matter is set out below.

Explanation of the special resolutions in respect of January 2023 Dividend and Share Repurchases (the "Resolutions")

As previously announced on 30 March 2023 and 28 April 2023, the Board became aware of an administrative oversight concerning technical compliance with the Companies Act 2006 ("CA 2006") in respect of the special dividend paid on 27 January 2023 (the "January 2023 Dividend") and share repurchases by the Company between 27 January 2023 and 30 March 2023 (the "Share Repurchases").

The Group's historic reported trading results and financial condition, and ability to pay future dividends are entirely unaffected by this matter.

Resolution 15 - Appropriation of the Company's distributable profits in relation to January 2023 special dividend

On 27 January 2023, the Company paid a special dividend of 55.4 pence per ordinary share with the total amount of the dividend being £24,962,993 (the "January 2023 Dividend"). While the Company had sufficient reserves overall to support the January 2023 Dividend, there was an administrative oversight concerning technical compliance with the CA 2006, as the Company's latest filed annual accounts at the time (the "2021 Annual Accounts") did not evidence the necessary reserves for the distribution. In particular, the 2021 Annual Accounts showed £44,056,483 in distributable reserves, and following the distributions made in the period up to 27 January would have stood at £17,747,310 resulting in £7,215,683 of the January 2023 Dividend being unlawful (the "Relevant Dividend"). On 31 March 2023, the Company filed interim accounts at Companies

House which show distributable reserves for the relevant period.

As this was an administrative oversight it should be noted that no Shareholder inadvertently benefited from this distribution and that the purpose of this proposed resolution is to put Shareholders and all potentially affected parties, so far as possible, in the same substantive position they would have been had the administrative oversight not occurred.

Accordingly, in order to rectify the Relevant Dividend, Resolution 15 (set out in the Notice of AGM) proposes (i) the appropriation of sufficient distributable profits of the Company to the payment of the Relevant Dividend; and (ii) to release by way of set off the appropriated distributable profits against amounts owed by Shareholders in respect of the Relevant Dividend pursuant to a formal deed of release with the past and present Shareholders who were recipients of the Relevant Dividend (the "Shareholders' Deed of Release").

Resolution 16 - Cancellation of shares and appropriation of distributable profits in relation to void share repurchase

The Company effected certain share repurchases between 27 January 2023 and 30 March 2023 (the "Share Repurchases") pursuant to a share purchase plan announced on 8 July 2022. Due to the lack of distributable reserves following the January 2023 Dividend and as a further consequence of the administrative oversight described above, the Share Repurchases were made without sufficient distributable reserves as required by the CA 2006 and are considered void. As a result, the repurchases and cancellation of, in aggregate, 94,822 Ordinary Shares for consideration of £651,847 are void (the "Void Shares"). The Company will seek High Court approval for the cancellation of the Void Shares as required by the CA 2006.

The Company may have a claim against the Shareholders from whom it acquired the Void Shares (the "Repurchase Shareholder Claim"). Those claims are (at the very least) not straightforward and the Company does not consider that it should seek to unwind the Share Repurchases and seek repayment of the monies due but, instead, seeks to give legal effect to the Share Repurchases it intended to undertake at the time and which the Board still considers to be in the best interests of the Company. Accordingly, the Company proposes to seek cancellation of the Void Shares on the basis that the selling Shareholders be released from any liability they may have to the Company in return. Provided shareholder approval is obtained and the High Court confirms the cancellation, both the Company and the selling shareholders will be in the same substantive position they would have been had the administrative oversight not occurred.

Accordingly, Resolution 16 proposes the cancellation of the Void Shares in exchange for the set off of the Repurchase Shareholder Claim. On the assumption that the cancellation of the Void Shares takes effect, Resolution 16 also approves the Company entering into a formal release in respect of the potential claims against the current and former shareholders who were recipients of the proceeds of the Share Repurchases (such release to be contained in the Shareholders' Deed of Release").

Resolution 17 - Directors' deed of release

While it is noted that the Company has no intention of bringing any claims against any Directors in respect of the Relevant Dividend or the Share Repurchases, it is proposed that the deeds detailed below are entered into to confirm that the Company will not make any claims against the Affected Directors (as defined below).

Accordingly, Resolution 17 proposes to waive and release the Affected Directors from any obligations or liabilities arising from the Relevant Dividend and/or the Share Repurchases by way of the Company entering into deed polls in favour of the Affected Directors (the "Directors' Deed of Release").

Resolutions 15 to 17, if passed, will put all potentially affected parties, so far as possible, in the position in which they were always intended to be had the Relevant Dividends been made and the Share Repurchases been carried out in accordance with the procedural requirements of the CA 2006.

The proposed remedial steps will not have any effect on the Company's financial position.

Related party transactions

The entry by the Company into the Shareholders' Deed of Release and consequential waiver of any rights of the Company to make claims against shareholders in respect of the January 2023 Dividend and the Share Repurchases constitute related party transactions pursuant to Rule 13 of the AIM Rules, in respect of Lombard Trust (and therefore Lord Michael Ashcroft), and Hendrik M. Van Heijst and associates who are currently each interested in more than 10 per cent of the total voting rights to be cast at the AGM.

In addition, the entry by the Company into the Directors' Deed of Release and consequential waiver of any rights of the Company to make claims against past and present Directors in respect of the January 2023 Dividend, constitutes a related party transaction pursuant to Rule 13 of the AIM Rules as each of the Directors is a related party for the purposes of the AIM Rules.

The votes of each of the Directors shall not be taken into account in establishing whether the majority necessary for the passing of Resolutions 15 to 17 has been obtained. The Directors have undertaken to abstain from voting on Resolutions 15 to 17.

In lieu of any independent Directors' recommendation in relation to Resolutions 15 to 17, in order to provide a statement as to what is fair and reasonable, and specifically due to all Directors being statutory directors at the time that the January 2023 Dividends were paid, Canaccord Genuity Limited, in its capacity as Nominated Adviser to the Company for the purposes of the AIM Rules, considers that Resolution 15 to 17 (and specifically the entry by the Company into the Shareholders' Deed of Release and the Directors' Deed of Release) is fair and reasonable insofar as the Shareholders of the Company are concerned.

Impellam Group plc Julia Robertson, Chief Executive Officer	01582 692 658
Canaccord Genuity Ltd (Nomad and Sole Broker) Bobbie Hilliam Emma Gabriel Thomas Diehl	020 7523 8150

Note to Editors:

Impellam is a connected group providing global workforce and specialist recruitment solutions. Our 2000 people and market leading brands work across a broad spectrum of industries and job categories throughout North America, the UK and Europe and Asia Pac.

Our award-winning Global Managed Services provide a diverse range of digitally enabled, multi-disciplinary workforce solutions to organisations around the world. We are upper quadrant industry leaders in Managed Service Provision and Services Procurement, and the seventh largest Managed Service Provider in the world with over £4bn SUM (Spend under Management).

Our STEM businesses are specialists in recruiting and engaging talent in the key growth markets of technology, digital, data, science, clinical and engineering and work with clients across all sectors and sizes delivering services that span Managed Services (MSP), Recruitment Process Outsourcing (RPO), Statement of Work (SOW) and specialist recruitment.

Led by our Virtuosos, our capabilities are underpinned by our proprietary digital technology and unique partnerships with market-leading software providers, enabling us to transform and future-proof our services.

We believe in the power of work. Through the power of work, we build better businesses and help people lead more fulfilling lives.

For more information about Impellam Group please visit:    www.impellam.com

Rule 26.1 disclosure:

In accordance with Rule 26.1 of the City Code on Takeovers and Mergers, a copy of this announcement will be available on the investor section of the Company's website at https://investors.impellam.com/ by no later than 12 noon (London time) on the business day immediately following the date of this announcement. The content of the website referred to in this announcement is not incorporated into and does not form part of this announcement.

 

END