CMC Markets Plc Notice of GM (0680S)

TIDMCMCX

RNS Number : 0680S

CMC Markets Plc

11 July 2022

CMC MARKETS PLC

NOTICE OF GENERAL MEETING TO APPROVE PROPOSED RELATED PARTY TRANSACTION AND AUDITOR'S STATEMENT OF REASONS

CMC Markets plc (the "Company"), announces that the following documents are being posted or otherwise made available to shareholders:

   --      Notice of General Meeting to approve proposed related party transaction ("GM");

-- Auditor's statement of their reasons for ceasing to hold office ("Statement of Reasons"); and

   --      Notice of Availability.

Pursuant to Listing Rule 9.6.1R, copies of the Notice of GM, Statement of Reasons and Notice of Availability have been submitted to the National Storage Mechanism and will shortly be available for inspection at https://data.fca.org.uk/#/nsm/nationalstoragemechanism .

The Notice of GM, Statement of Reasons and Notice of Availability can also be viewed on the Company's website at www.cmcmarketsplc.com/investors .

The GM will be held at 133 Houndsditch, London, EC3A 7BX on Thursday 28 July 2022 at 10.30 a.m. (or as soon thereafter as the Annual General Meeting of the Company convened for 10.00 a.m. on that day has been concluded or adjourned).

The Board of CMC Markets plc ("the Board") is looking forward to welcoming shareholders in person to the GM. However, in the event that government restrictions on public gatherings or other social distancing measures are reintroduced, the Company may be required to change the arrangements for the Meeting at short notice. Any changes to the arrangements set out in the Notice of GM will be communicated to shareholders via the Company's website www.cmcmarketsplc.com/investors/shareholder-information/#AGM and announced via a regulatory news service. Further information can be found in the Notice of GM.

As noted in the Directors' Report for the year ended 31 March 2022, the Board has discovered a procedural oversight in respect of the Company's processes for the payment of certain past dividends, namely that the FY17 interim dividend paid on 23 December 2016, the FY18 interim dividend paid on 22 December 2017 and the FY21 interim dividend paid on 18 December 2020 (together, the "Relevant Dividends") were made otherwise than in accordance with the strict formalities of the Companies Act 2006 (the "Act").

In relation to the Relevant Dividends, the interim accounts were not filed at Companies House as required by the Act, although in each case interim accounts were prepared which demonstrated sufficient distributable reserves. The omission of filing interim accounts constitutes a procedural breach of the Act. In aggregate, the unlawful component of all three Relevant Dividends is GBP33,968,171.

The Company has been advised that, as a consequence of the Relevant Dividends having procedurally been made otherwise than in accordance with the Act, it may have claims against past and present shareholders who were recipients of the Relevant Dividends and against persons who were directors of the Company at the time of the payment of the Relevant Dividends. It is therefore proposed that the Company enter into deeds of release such that the Company will be unable to make any claims against:

1) past and present shareholders of the Company who were recipients of the Relevant Dividends, including Lord Peter Cruddas, Lady Fiona Cruddas and other members of the Cruddas family (who are related parties of the Company as substantial shareholders); and

2) the directors of the Company (excluding Susanne Chishti) and the former directors of the Company in office at the time of any Relevant Dividend, in each case in respect of the payment of the Relevant Dividend otherwise than in accordance with the Act. The current directors are related parties of the Company, being James Richards, David Fineberg, Peter Cruddas, Sarah Ing, Clare Salmon, Paul Wainscott., Euan Marshall and Matthew Lewis.

The Company has today published a Notice of GM convening a General Meeting at which a resolution will be proposed which will, if passed, give the Board authority to enter into a directors' deed of release (the "Directors' Deed of Release") and a shareholders' deed of release (the "Shareholders' Deed of Release") and 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 in accordance with the procedural requirements of the Act (the "Resolution"). The Company's entry into the Directors' Deed of Release and the Shareholders' Deed of Release will not have any effect on the Company's financial position.

The entry into the Directors' Deed of Release and the Shareholders' Deed of Release constitute related party transactions under the FCA's Listing Rules, and specifically fall within Listing Rule 11.1.10R. Therefore the Resolution will also seek the specific approval for the entry into the Directors' Deed of Release and Shareholders' Deed of Release as related party transactions, in accordance with the Listing Rules.

The approach that the Company is proposing is in line with the approach taken by other UK incorporated listed companies which have discovered past dividends were made otherwise than in strict accordance with the Act.

For further information contact:

Patrick Davis

General Counsel & Company Secretary

CMC Markets plc

+ 44 (0) 20 7170 8200

LEI Number: 213800VB75KAZBFH5U07

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