Totally Regulatory News (TLY)

16 June 2016

Totally plc

("Totally", "the Company" or "the Group")

Notice of General Meeting

The Board of Totally (AIM: TLY), the provider of a range of services to the healthcare sector, announces that the Company will later today post a notice of general meeting ("General Meeting") to shareholders. The General Meeting will be held at 11.15 a.m. on 11 July 2016 at Hamilton House, Mabledone Place, London, WC1H 9BB.

The purpose of the General Meeting is to seek the approval of shareholders to cancel the share premium account of the Company and to buy back all the issued deferred shares of the Company.

A copy of the circular containing the Notice of General Meeting will shortly be available on the Company's website at www.totallyplc.com.

Below are extracts from the circular and should be read in conjunction with the full text.

Defined terms used in this announcement have the meaning as set out in the circular.

1. Background to the Capital Reduction

The Company has built up a substantial Share Premium Account through the issue of shares for cash at values in excess of the nominal value of those shares. This share premium comprises a non-distributable reserve for the purposes of the Act. At the date of this document, the balance standing to the credit of the Share Premium Account is £9,610,554. It is proposed that the Share Premium Account be cancelled in its entirety.

The Company is generally precluded from the payment of any dividends or other distributions or the redemption or buy back of its issued shares in the absence of sufficient distributable reserves. If approved by Shareholders and subsequently confirmed by the High Court in the terms proposed by your Board, the effect of the Capital Reduction will be to release the total amount standing to the credit of the Share Premium Account so that £9,610,554 will be credited to the distributable reserves of the Company to allow the Company to pay dividends in due course.

The implementation of the Capital Reduction is subject to a number of criteria and legal processes which are explained further below.

2. Capital Reduction - Share Premium Account

Share premium is treated as part of the capital of a company and arises on the issue by a company of shares at a premium to their nominal value. The premium element is credited to the share premium account.

The share premium account is a non-distributable capital reserve and a company's ability to use any amount credited to that reserve is limited by the Companies Act. However, with the approval of its shareholders by way of a special resolution and subsequent confirmation by the High Court, a company may reduce or cancel its share premium account and in certain circumstances either return all or part of the sum arising to shareholders as a return of capital, or credit some or all of such sum arising to its profit and loss account.

To the extent that the release of such a sum from the share premium account creates or increases a credit on the profit and loss account, that sum represents a company's distributable reserves.

As mentioned above, the cancellation of the Share Premium Account will reduce the carried forward loss on the Company's profit and loss account by £9,610,554 to create a profit of £3,030,363.

3. Capital Reduction - Procedure

In order to effect the Capital Reduction, the Company firstly requires the authority of its Shareholders by the passing of a special resolution at the General Meeting to approve and effect the reduction of the Share Premium Account.

Secondly, the Capital Reduction must be confirmed by the High Court, to which the Company will make an application if that special resolution is passed.

The Capital Reduction will take effect when the Order of the High Court confirming it, and a statement of capital approved by the High Court, have been registered with the Registrar of Companies. The Effective Date of the Capital Reduction is currently expected to be 5 August 2016. That date is likely to be within a few working days after the hearing at which the Capital Reduction is confirmed by the High Court, which is currently expected to be on or around 3 August 2016.

In order to approve the Capital Reduction, the High Court will need to be satisfied that the interests of the Company's creditors will not be prejudiced by the Capital Reduction. The Company is not required to seek written consent to the Capital Reduction from its creditors. However, for the benefit of those of its creditors from whom consent is not required, the Company may be obliged to provide security in a form acceptable to the High Court. This is in order that the Capital Reduction can be confirmed by the High Court on terms that will permit any part of the sum released by the Capital Reduction either to be returned to Shareholders as a capital payment or credited to the profit and loss account of the Company so as to create distributable reserves.

If the Company is unable in the timetable proposed to obtain consent from, or is unable or unwilling to provide security (where security is required) for all such creditors, then the amount released by the Capital Reduction, when the Capital Reduction is confirmed by the High Court, will remain undistributable for the time being until any such outstanding consents have been obtained, security (where security is required) has been put in place, or the relevant obligations have been discharged, and the Company may be required to give an undertaking to that effect to the High Court.

The Board reserves the right (where necessary by application to the High Court) to abandon, discontinue or adjourn any application to the High Court for confirmation of the Capital Reduction, and hence the Capital Reduction itself, if the Board believes that the terms required to obtain confirmation are unsatisfactory to the Company or if as the result of a material unforeseen event the Board considers that to continue with the Capital Reduction is inappropriate or inadvisable.

4. Buy-Back of Deferred Shares

The Deferred Shares carry no voting rights, no rights to attend general meetings of the Company, and no rights to receive dividends. The Deferred Shares do carry a right to participate in any return of capital to the extent of 0.01 pence per Deferred Share but only after each Ordinary Share has received in aggregate capital repayments totalling £1,000,000 per Ordinary Share.

The Board can see no reason for the Deferred Shares to remain on the balance sheet and recommends that the Deferred Shares are purchased by the Company.

Under the provisions of the Articles, the Company has the power to buy back the Deferred Shares for £0.01 in aggregate. In addition, the Board is authorised to agree on behalf of the holders of the Deferred Shares the purchase by the Company of the Deferred Shares and is irrevocably authorized to do all such things necessary or desirable to give effect to a purchase under the Articles. The Company would propose therefore that any one of its Directors be authorised to carry out this function.

Under the provisions of the Act, a public limited company may not fund the purchase of its shares except out of its distributable reserves or the proceeds of a fresh issue of shares made solely for the purpose of such Buy Back. The Company has no distributable reserves in order to fund the Buy Back and therefore it is proposed that the Buy Back is funded by the issue of one Ordinary Share to Bob Holt at nominal value of £0.10.

The Buy Back is conditional upon obtaining a special resolution of the Shareholders. At the General Meeting, Shareholders will be asked to approve, if thought fit, the Buy Back.

Under the Act a copy of the Buy-Back Agreement must be made available for inspection at the Company's registered office by the Shareholders at least 15 days prior to the meeting approving the Buy-Back. A copy of the Buy-Back Agreement is currently available for inspection on the Company's website at www.totallyplc.com and at its registered office. A copy of the Buy-Back Agreement will also be available for inspection at the General Meeting.

5. The Resolutions

An explanation of the Resolutions which are to be proposed at the General Meeting is set out below:

Capital Reduction - Cancellation of the Share Premium Account

A special resolution to cancel the total amount standing to the credit of the share premium account of the Company being £9,610,554. The Capital Reduction does not affect the number of Ordinary Shares in issue, the nominal value per Ordinary Share or the voting or dividend rights of any Shareholder. The Capital Reduction, once approved by the High Court, will allow the Company to pay dividends.

Buy-Back of Deferred Shares

A special resolution to buy back the Deferred Shares for £0.01 in aggregate.

6. Proposed purchase of Ordinary Shares held by Minority Shareholders

The Group is conscious that as at 10 June 2016 491 shareholders held 50 Ordinary Shares or less with an aggregate holding totalling 7,121 Ordinary Shares. At the mid-market price of an Ordinary Share of 55.5 pence as at 14 June 2016 a shareholding of 50 Ordinary Shares would be valued at £27.75. The transaction costs of a sale of Ordinary Shares valued at that amount make a normal sale process economically unviable for a shareholder.

The Chairman of Totally, Bob Holt, is willing to acquire the Ordinary Shares held by any existing shareholder where their holding amounts to 50 Ordinary Shares or less. If you hold 50 Ordinary Shares or less please email bob.holt@totallyplc if you would like to arrange a sale of your Ordinary Shares. A sale of Ordinary Shares by those shareholders owning 50 Ordinary Shares or less at the date of this document would reduce the number of shareholders significantly and would achieve cost savings for the Company as the Company incurs printing and posting costs whenever documents are sent to shareholders.

Please note that any purchase of Ordinary Shares by Bob Holt will only be able to be undertaken when the Company is not deemed to be in a "close period" as defined by the AIM Rules for Companies and any share purchase will need to be undertaken in accordance with the prevailing UK securities legislation and the AIM Rules for Companies. There can be no guarantee that any share sale will be able to be undertaken on behalf of the shareholder nor can there be any guarantee on the terms of any sale share.

The proposal above is not subject to a resolution at the General Meeting.

7. Action to be taken

A reply-paid Form of Proxy for use in connection with the General Meeting is enclosed with this document. Whether or not you intend to be present at the General Meeting, you are requested to complete, sign and return the Form of Proxy in accordance with the instructions printed thereon to the Share Registrars Limited, Suite E, First Floor, 9 Lion and Lamb Yard, Farnham, Surrey, GU9 7LL as soon as possible and, in any event, not later than 11.15 a.m on 7 July 2016. The completion and return of a Form of Proxy will not preclude you from attending the General Meeting and voting in person should you subsequently wish to do so.

8. Recommendation

Your Board considers that the passing of the Resolutions to be proposed at the General Meeting are in the best interests of the Company and its Shareholders as a whole. Accordingly, your Directors unanimously recommend that you vote in favour of the Resolutions set out in the Notice of General Meeting as they intend to do in respect of 1,141,446 Ordinary Shares held by them (representing 5.71 per cent of the Company's issued share capital).

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