TIDMTAST
RNS Number : 5990J
Tasty PLC
23 December 2020
23 December 2020
Tasty plc
("Tasty" or the "Company")
Approval of waiver of obligations under Rule 9 of the Takeover
Code
Related Party Transaction
Approval of Growth Shares Scheme
Adoption of New Articles
and
Notice of General Meeting
Tasty (AIM: TAST), the owner and operator of restaurants in the
casual dining sector, announces that it will be posting a circular
to shareholders (the "Circular") today including notice convening a
general meeting ("Notice of General Meeting") to be held at 12.00
p.m. on 15 January 2021 at the Company's offices at 32 Charlotte
Street, London W1T 2NQ (the "General Meeting").
General Meeting
The Directors are asking all Shareholders not to attend the
General Meeting in light of the UK Government's current
restrictions on gatherings and the rules regarding social
distancing which have been imposed in response to the Covid-19
pandemic. Shareholders who attempt to attend the GM in person in
breach of any stay at home measures which are in place on the date
of the GM will not be admitted. Instead, please vote by proxy on
the Resolutions in advance of the General Meeting by one of the
methods described in the Circular. Voting will be taken on a poll
for all of the Resolutions. Given the current restrictions on
attendance in person at the GM, Shareholders are encouraged to
appoint the chairman of the GM as their proxy rather than a named
person who will not currently be permitted to attend the GM unless
the UK Government's restrictions in place at the date of this
announcement are relaxed or lifted prior to the GM.
Shareholders are requested to vote as soon as possible and, in
any event, to be valid so as to be received by the Company's
registrars, Computershare Investor Services, by not later than
12.00 p.m. on 13 January 2021. Hard copies of the Forms of Proxy
should be returned to Computershare Investor Services PLC at The
Pavilions, Bridgwater Road, Bristol BS99 6ZY.
In addition, Shareholders can also submit questions relating to
the business of the General Meeting at any time from the date of
this announcement by email to info@dimt.co.uk and the Company will
answer such questions on a regular basis up until 12.00 p.m. on 13
January 2021. If the restrictions on gatherings and social
distancing are relaxed or lifted by the UK Government prior to the
date of the GM, the Company will notify Shareholders of any
resulting change which may affect the ability of Shareholders to
attend the GM by issuing a further announcement through a
Regulatory Information Service and on its website at
https://dimt.co.uk/investor-relations/news/.
The Circular is available to view on the Company's website at
https://dimt.co.uk/investor-relations/ . Capitalised terms in this
announcement shall have the same meaning as in the Circular to be
posted to shareholders today.
Growth Shares Scheme
As announced on 15 September 2020 and 23 December 2020, the
composition of the Board of Directors has changed with Adam Kaye
stepping down from the Board, Sam Kaye changing his role from Joint
Chief Executive Officer to Non-executive Director and Jonny Plant
becoming sole Chief Executive Officer. As part of these changes,
Jonny Plant's role and responsibility has increased significantly
and it was therefore deemed appropriate, given his current lack of
equity incentive, aside from his interest in Ordinary Shares, to
incentivise him in the form of the Growth Shares Scheme to which
Jonny Plant will be invited to join as the first participant. A
summary of those proposed incentive arrangements in the form of the
Growth Shares Scheme is set out below.
Following consultation with certain major shareholders it is
proposed to introduce the Growth Shares Scheme to vary Jonny
Plant's incentive arrangements so that he may be issued the B
Ordinary Shares pursuant to the Growth Shares Scheme. These B
Ordinary Shares are convertible into new Ordinary Shares subject to
certain performance criteria being achieved as summarised below.
Should all the B Ordinary Shares be converted into new Ordinary
Shares these new Ordinary Shares will represent a maximum of 10% of
the Existing Ordinary Shares. In addition, Jonny Plant currently
holds 7,091,902 Ordinary Shares, representing 5.03% of the Existing
Ordinary Shares.
Following the issue of the B Ordinary Shares and their
subsequent conversion into Ordinary Shares (should the performance
criteria above be achieved); Jonny Plant will hold (together with
his existing holding of Ordinary Shares) an interest in the Company
of up to a total of 22,768,542 Ordinary Shares representing 14.52%
of the Enlarged Ordinary Share Capital and the Concert Party will
hold, in aggregate, 67,593,410 Ordinary Shares, representing 43.12%
of the Enlarged Ordinary Share Capital.
The Takeover Panel has agreed, subject to the passing of the
Whitewash Resolution by Independent Shareholders (being
Shareholders other than the members of the Concert Party), to waive
the obligation on the Concert Party to make a general offer to
Shareholders under Rule 9 of the Code that could otherwise arise on
the grant to Jonny Plant of B Ordinary Shares and their subsequent
conversion into new Ordinary Shares (should performance criteria be
met).
Accordingly, the Company is seeking the approval at the General
Meeting of, amongst other things, the Whitewash Resolution and the
implementation of the Growth Shares Scheme (which will also
necessitate the adoption of new articles of association of the
Company).
The Growth Shares Scheme will not be implemented if the
Whitewash Resolution is not passed at the General Meeting.
Related Party Transaction
The issue of the B Ordinary Shares to Jonny Plant (and any
subsequent conversion representing a maximum of 10% of the Existing
Ordinary Shares) could be deemed to fall outside of usual
remuneration parameters and is therefore classified as a related
party transaction under AIM Rule 13. The Directors (excluding Jonny
Plant), having consulted with the Company's nominated adviser,
Cenkos Securities, believe that the terms of the new incentive
arrangements are fair and reasonable insofar as shareholders are
concerned.
For further information, please contact:
Tasty plc Tel: 020 7637 1166
Jonny Plant, Chief Executive
Cenkos Securities plc (Nominated adviser
and broker)
Mark Connelly / Katy Birkin Tel: 020 7397 8900
1. Background to, and reasons, for the proposed implementation of the Growth Shares Scheme
As announced on 15 September 2020 and 23 December 2020, the
composition of the Board of Directors has changed with Adam Kaye
stepping down from the Board, Sam Kaye changing his role from Joint
Chief Executive Officer to Non-executive Director and Jonny Plant
becoming sole Chief Executive Officer. As part of these changes,
Jonny Plant's role and responsibility has increased significantly
and it was therefore deemed appropriate, given his current lack of
equity incentive, aside from his interest in Ordinary Shares, to
incentivise him in the form of the Growth Shares Scheme. A summary
of those proposed incentive arrangements in the form of the Growth
Shares Scheme is set out below.
The Growth Shares Scheme
It is proposed that the Company establishes the Growth Shares
Scheme to which Jonny Plant will be invited to join as the first
participant. The object of the Growth Shares Scheme is to entitle
the employee to participate only in the future capital growth of
the Company as well as permit the employee to convert their B
Ordinary Shares into the Company's Ordinary Shares, whilst
retaining many of the commercial benefits of an option scheme.
Following consultation with certain major shareholders it is
proposed to introduce a new incentive arrangement to vary Jonny
Plant's incentive arrangements so that he may be issued the B
Ordinary Shares pursuant to the Growth Shares Scheme. These B
Ordinary Shares are convertible into new Ordinary Shares subject to
certain performance criteria being achieved as summarised below
(and detailed further in paragraph 7 of Part III of the Circular).
Should all the B Ordinary Shares be converted into new Ordinary
Shares these new Ordinary Shares will represent a maximum of 10% of
the Existing Ordinary Shares. In addition, Jonny Plant currently
holds 7,091,902 Ordinary Shares, representing 5.03% of the Existing
Ordinary Shares.
The 90 day VWAP of an Ordinary Share as at the Last Practicable
Date was 2.30 pence. The level of participation that the B Ordinary
Shares are entitled to, and the maximum number of Ordinary Shares
into which the B Ordinary Shares can convert is referenced to the
following share price performance targets of the Company being
met:
-- if, at any time, within 12 months, the 90 day VWAP of the
Ordinary Shares is 6 pence or more, up to 3.33%;
-- if, at any time, within 24 months, the 90 day VWAP of the
Ordinary Shares is 8 pence or more, up to 6.67%;
-- if, at any time, within 48 months, the 90 day VWAP of the
Ordinary Shares is 16 pence or more, up to 10%;
The maximum percentage that the new Ordinary Shares will
represent, as a result of the conversion of B Ordinary Shares, will
be no more than 10% of the Existing Ordinary Shares.
Example
By way of an example of the above rights, if in 20 months' time
the 90 day VWAP is more than 8p, Jonny Plant's B Ordinary Shares
are entitled to convert into and up to 10,451,093 new Ordinary
Shares, being 6.67% of the Existing Ordinary Shares.
Further details of the Growth Shares Scheme are set out in
paragraph 7 of Part III of the Circular.
The Growth Shares Scheme will not be implemented if the
Whitewash Resolution is not passed at the General Meeting.
Following the issue of the B Ordinary Shares and their
subsequent conversion into Ordinary Shares (should the performance
criteria above be achieved); Jonny Plant will hold (together with
his existing holding of Ordinary Shares) an interest in the Company
of up to a total of 22,768,542 Ordinary Shares representing 14.52%
of the Enlarged Ordinary Share Capital and the Concert Party will
hold, in aggregate, 67,593,410 Ordinary Shares, representing 43.12%
of the Enlarged Ordinary Share Capital.
2. Background to and reasons for the Rule 9 Waiver
The purpose of issuing the B Ordinary Shares to Jonny Plant
pursuant to the Growth Shares Scheme is to incentivise him for the
benefit of Shareholders to reflect his new role and responsibility
as sole Chief Executive Officer .
As described above, the Company proposes to issue the B Ordinary
Shares to Jonny Plant following the passing of the Whitewash
Resolution (subject to all of the other Resolutions also being
passed at the General Meeting).
The increase in the percentage shareholding of the Concert Party
as a result of the conversion of B Ordinary Shares into new
Ordinary Shares by Jonny Plant without a waiver of the obligations
under Rule 9 of the Takeover Code (commonly referred to as a
"Whitewash"), would oblige the Concert Party to make a general
offer to Shareholders under Rule 9 of the Takeover Code. The Panel
has agreed to a waiver of this obligation, subject to the Whitewash
Resolution being approved at the General Meeting (on a poll) by
Independent Shareholders who hold in excess of 50% of the
Independent Shares. The Rule 9 Waiver is therefore conditional upon
Independent Shareholders approving the Whitewash Resolution. If the
Whitewash Resolution is not approved by Independent Shareholders,
the Growth Shares Scheme will not be implemented.
The Takeover Code
The Takeover Code is issued and administered by the Takeover
Panel. The Takeover Code applies, inter alia, to all public
companies which have their registered office in the United Kingdom
and are considered by the Takeover Panel to have their place of
central management and control in the United Kingdom. The Company
is such a company and Shareholders are therefore entitled to the
protections afforded by the Takeover Code.
Under Rule 9 of the Takeover Code, any person who acquires an
interest (as such term is defined in the Takeover Code) in shares
which, taken together with the shares in which he and persons
acting in concert with him are interested, carry 30% or more of the
voting rights in a company that is subject to the Takeover Code, is
normally required to make a general offer to all of the remaining
shareholders to acquire their shares. Similarly, when any person,
together with persons acting in concert with him or her, is
interested in shares which in aggregate carry not less than 30% of
the voting rights but does not hold shares carrying more than 50%
of the voting rights of such a company, a general offer will
normally be required if any further interests in shares are
acquired which increases the percentage of shares carrying voting
rights by any such person. Such an offer would have to be made in
cash at a price not less than the highest price paid by him, or by
any member of the group of persons acting in concert with him, for
any interest in shares in the company during the 12 months prior to
the announcement of the offer.
As the Concert Party is currently beneficially interested in
51,916,770 Ordinary Shares, representing approximately 36.80% of
the Existing Ordinary Shares and the members of the Concert Party
are presumed by the Panel to be acting in concert, the proposed
issue of the B Ordinary Shares and their subsequent conversion into
new Ordinary Shares would result in the Concert Party being
obliged, under Rule 9 of the Takeover Code, to make a Rule 9 Offer
for the remaining Ordinary Shares then in issue and not already
owned by them.
Under Note 1 of the Notes on Dispensations from Rule 9, the
Panel will normally waive the requirement for a Rule 9 Offer if,
inter alia, those shareholders of the Company who are independent
of the person who would otherwise be required to make an offer pass
an ordinary resolution on a poll at a general meeting approving
such a waiver.
The Takeover Panel has agreed, subject to the passing of the
Whitewash Resolution by Independent Shareholders (being
Shareholders other than the Concert Party) voting by way of a poll,
to waive the obligation on the Concert Party to make a general
offer to Shareholders under Rule 9 of the Code that could otherwise
arise on any conversion of the B Ordinary Shares into new Ordinary
Shares that the Company is intending to issue to Jonny Plant.
Shareholders should be aware that if the Whitewash Resolution is
passed, the Concert Party will, in aggregate, hold an interest in
Ordinary Shares carrying 30% or more of the Company's voting rights
but will not hold Ordinary Shares carrying more than 50% of such
voting rights and, as long as they continue to be treated as acting
in concert, any further increase in the Concert Party's aggregate
interest in Ordinary Shares will be subject to Rule 9 of the
Takeover Code.
In the event that the Whitewash Resolution is approved at the
General Meeting, the Concert Party, or individual members thereof,
will not be restricted from making an offer for the Company.
The Concert Party
Under the Takeover Code, a concert party arises when persons,
pursuant to an agreement or understanding (whether formal or
informal), co-operate to obtain or consolidate control of, or
frustrate the successful outcome of an offer for, the Company.
Control means an interest or interests in shares carrying in
aggregate 30% or more of the voting rights of a company
irrespective of whether the interest or interests give de facto
control.
As set out in the circular to shareholders dated 12 April 2019,
Adam and Sam Kaye are brothers and are members of a wider concert
party comprising a number of their extended family members who have
an existing shareholding in the Company (as well as interests in
other Kaye family related quoted companies including Everyman Media
Group plc, Comptoir Group plc and Richoux Group plc, and, prior to
its sale to TPG Capital LLC, Prezzo plc). Due to their close family
link, Adam and Sam Kaye and members of their extended family are
presumed to be acting in concert for the purposes of the Takeover
Code and accordingly their beneficial interests in the Company are
required to be aggregated for consideration of Rule 9 of the
Takeover Code. The Kaye family members presumed to be acting in
concert with Adam Kaye and Sam Kaye are Jonathan Kaye, Phillip
Kaye, Samantha Sanson and Doreen Kaye.
Adam Kaye, Sam Kaye and Jonny Plant, are the joint founders of
the business that became Tasty plc, and they are close friends,
having known each other for thirty years. In addition to Jonny
Plant's interest in the Company, he too has historically had
interests in other Kaye family related quoted companies including
Everyman Media Group plc and Comptoir Group plc and has a current
interest in Richoux Group plc. Save for Adam Kaye's appointment as
an executive director of Everyman Media Group plc, Adam Kaye and
Sam Kaye have no involvement in the management of these companies
and their interests in them as shareholders are held purely as
investments. Similarly, Jonny Plant has no involvement in the
management of Richoux Group plc and his interest as a shareholder
is held purely as an investment. In light of the relationships
outlined above, Jonny Plant is treated as acting in concert with
the Kaye family members referred to above for the purposes of the
Takeover Code.
Should Jonny Plant convert his B Ordinary Shares into new
Ordinary Shares in full, and assuming no other Ordinary Shares are
issued by the Company following the date of this announcement, then
the Concert Party would have an interest in the Company of
67,593,410 Ordinary Shares representing 43.12 % of the Enlarged
Ordinary Share Capital. Full details of the Concert Party's
interests in Ordinary Shares on 22 December 2020 (being the Last
Practicable Date) and percentage interest in Ordinary Shares if
Jonny Plant converted his B Ordinary Shares into new Ordinary
Shares in full are set out below:
Name Number of Percentage of Proposed number Maximum number of Resulting
Ordinary Shares Existing Ordinary of B Ordinary new Ordinary holding as a
held on the Last Shares Shares Shares upon percentage of
Practicable Date conversion of the the Enlarged
B Ordinary Shares Ordinary Share
Capital assuming
conversion
of all the B
Ordinary Shares
and assuming no
further issue of
Ordinary Shares
Adam Kaye 12,236,560 8.67% - - 7.81%
Sam Kaye 20,750,588 14.71% - - 13.24%
Phillip Kaye 6,214,218 4.40% - - 3.96%
Jonathan Kaye 5,565,811 3.94% - - 3.55%
Samantha Sanson 38,461 0.03% - - 0.02%
Doreen Kaye 19,230 0.01% - - 0.01%
Jonny Plant 7,091,902 5.03% 15,676,640 15,676,640 14.52%
Total 51,916,770 36.80% 15,676,640 15,676,640 43.12%
Rule 9 Waiver
The Panel has agreed to waive the obligation on the Concert
Party to make a general offer that would otherwise arise as a
result of the conversion of B Ordinary Shares into new Ordinary
Shares under the Growth Shares Scheme, subject to the approval of
the Independent Shareholders, (to be taken on a poll). Accordingly,
the Whitewash Resolution is being proposed at the General Meeting
to approve the Rule 9 Waiver in respect of the Concert Party for
the future conversion of B Ordinary Shares into new Ordinary
Shares. Members of the Concert Party will not be entitled to vote
on the Whitewash Resolution.
3. Intentions of the Concert Party
The Concert Party has confirmed that, if the Whitewash
Resolution is passed by the Independent Shareholders on a poll,
there is no agreement, arrangement or understanding for the
transfer of their Ordinary Shares to any third party. Save as set
out below, the Concert Party is not intending to seek any changes
in respect of: (i) the composition of the Board, nor the Company's
plans with respect to the continued employment of employees and
management of the Company and its subsidiaries (including any
material change in conditions of employment) or any material change
to the balance of skills and functions of the employees and
management; (ii) the Company's future business and its strategic,
research and development plans; (iii) the location of the Company's
headquarters or headquarter functions or the location of the
Company's place of business; (iv) employer contributions into any
of the Company's pension schemes, the accrual of benefits for
existing members, nor the admission of new members; (v)
redeployment of the Company's fixed assets; or (vi) the
continuation of the Ordinary Shares being admitted to trading on
AIM.
In the event that the Whitewash Resolution is passed by the
Independent Shareholders at the GM, the Concert Party will not be
restricted from making an offer for the Company.
4. Current trading
On 15 December 2020, the Company issued the following trading
update:
"Further to the Company's most recent Trading Update on 6
November 2020 detailing the closure of all of its restaurants for
in-store dining due to the second UK COVID-19 lockdown, the Company
confirms that it had re-opened 38 restaurants with an additional 5
units providing takeaway and delivery services only, due to the
Government restrictions. It is expected that a further 9 units will
move to providing takeaway and delivery services only with the
additional tier 3 restrictions being introduced in London and Essex
on 16 December 2020.
Certain restaurants within the Company's estate have remained
closed due to poor trading conditions in their locality. The
Company continues to monitor developments affecting both the open
and closed restaurants in line with the continually changing UK
tier restrictions. The Company intends to continue to offer
takeaway and delivery services across the 43 open units, until such
time as the Government announces that it is prohibited from doing
so or it is not viable to continue those services.
Trading across the business continues to be challenging with
Christmas parties cancelled and the differing levels of
restrictions significantly reducing the number of customers eating
out and related restaurant capacity restrictions.
The Company has now been successful in achieving rent reductions
and lease concessions on more than half of the estate. The Company
is continuing consensual negotiations with landlords and other
creditors in respect of outstanding rents and anticipates that this
process will now be completed in January 2021. The Company will
again be relying on Government support for employees' pay and VAT,
and business rate holidays and grants, where available."
The Company currently has open approximately 22 restaurants for
in-dining with an additional 19 units providing takeaway and
delivery services only.
5. Independent advice provided to the Board and Related Party Transaction
The Takeover Code requires the Board to obtain competent
independent advice regarding the merits of the Rule 9 Waiver which
is the subject of the Whitewash Resolution, the increase of the
Concert Party's controlling position on conversion of the B
Ordinary Shares into new Ordinary Shares and the effect it will
have on Shareholders generally. Accordingly, Cenkos, as the
Company's financial adviser, has provided formal advice to the
Board regarding the Proposals. Cenkos confirms that it is
independent of the Concert Party and has no commercial relationship
with them.
The issue of the B Ordinary Shares to Jonny Plant (and any
subsequent conversion representing a maximum of 10% of the Existing
Ordinary Shares) could be deemed to fall outside of usual
remuneration parameters and is therefore classified as a related
party transaction under AIM Rule 13. The Directors (excluding Jonny
Plant), having consulted with the Company's nominated adviser,
Cenkos Securities, believe that the terms of the new incentive
arrangements are fair and reasonable insofar as shareholders are
concerned.
6. R ecommendations
The Independent Directors, being Keith Lassman and Mayuri
Vachhani, who have been so advised by Cenkos, consider that the
Proposals are fair and reasonable and in the best interests of the
Independent Shareholders and the Company as a whole. In providing
advice to the Independent Directors, Cenkos has taken into account
the Independent Directors' commercial assessments.
The Independent Directors unanimously recommend that
Shareholders vote in favour of the Whitewash Resolution, as the
Independent Directors who are Shareholders have undertaken to do in
respect of their own beneficial holdings, representing
approximately 0.57% in aggregate of the Existing Ordinary Shares.
Jonny Plant and Sam Kaye, who are members of the Concert Party, are
not deemed to be independent for the purpose of this recommendation
and are therefore not entitled to vote on the Whitewash
Resolution.
The Directors believe that the Resolutions (excluding the
Whitewash Resolution) to be considered at the General Meeting are
in the best interests of the Company and its shareholders as a
whole and unanimously recommend that Shareholders vote in favour of
each of the Resolutions, as the Directors who are Shareholders
intend to do in respect of their beneficial shareholders
representing, in aggregate, over 14.71% of the Existing Ordinary
Shares.
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
RNS may use your IP address to confirm compliance with the terms
and conditions, to analyse how you engage with the information
contained in this communication, and to share such analysis on an
anonymised basis with others as part of our commercial services.
For further information about how RNS and the London Stock Exchange
use the personal data you provide us, please see our Privacy
Policy.
END
MSCEAPAAASSEFFA
(END) Dow Jones Newswires
December 23, 2020 02:01 ET (07:01 GMT)
Tasty (LSE:TAST)
Historical Stock Chart
From Apr 2024 to May 2024
Tasty (LSE:TAST)
Historical Stock Chart
From May 2023 to May 2024