Rule 26

The following information is being disclosed to satisfy the requirements of AIM Rule 26 of the London Stock Exchange – Alternative Investment Market (AIM).

The information on this page was correct as of 29 January 2020.

Name: Catenae Innovation Plc

London Stock Exchange Symbol: CTEA

Company Secretary: Sean Sydenham – 020 7929 7826

Link Asset Services Shareholder call centre: 0871 664 0300 (calls cost 10p per minute plus network extras).

From outside the UK please call +44 208 639 3399.

Registered Office: 27 Old Gloucester Street, London WC1N 2AX.

Trading Address: 26 Lansdowne Ct, Newcastle upon Tyne, NE3 1HP

Registration: Incorporated and registered in England and Wales under the Companies Act under registration number 04689130

Country of Operation: United Kingdom of Great Britain and Northern Ireland

VAT number: 818 3001 58

Email: enquiries@catenaeinnovation.com

Description of the business

Catenae Innovation Plc (“Catenae”) is a technical solutions provider specialising in bringing leading edge solutions and services in media and finance. Catenae also brings together expert media practices, leading-edge technology and proven business minds to deliver interactive solutions across web and mobile.

Subsidiaries

Catenae currently has three subsidiaries; Trust in Media Ltd, OnSide Now Ltd (Dormant) and Nexstar League Limited (Dormant). To find out more, please visit our Group and History pages.

Documents and Notifications

  • A profile of each of the Directors of the Company is available here.
  • A PDF version of the Company’s original (2003) AIM admission document can be downloaded here.
  • A PDF version of the Company’s Memorandum & Articles can be downloaded here.
  • PDF copies of the annual accounts, interim accounts and any other documents circulated to Shareholders by the Board in the past three years can be found on the Financial Reports page
  • All announcements issued by the Company in the past 12 months to RNS, the regulatory news service of the London Stock Exchange, can be found here.

To request hard copies of any of these documents please email enquiries@catenaeinnovation.com

Advisors & Bankers

Nominated Advisor: Cairn Financial Advisers LLP, 8 Frederick’s Place, London EC2R 8AB

Brokers:Turner Pope Investments Limited, Becket House, 36 Old Jewry, London EC2R 8DD

Auditor: Nexia Smith & Williamson Audit Ltd, Portwall Place, Portwall Lane, Bristol BS1 6NA

Registrar (contracted to manage Catenae’s share register): Link Asset Services, The Registry, 34 Beckenham Road, Kent BR3 4TU

Bank: National Westminster Bank PLC, 1 High Street, Woking, Surrey GU21 1ZS

Corporate Governance

Takeovers and Mergers

Catenae Innovation Plc is subject to the UK City Code on Takeovers and Mergers.

Compliance with Governance Code

Following the recent consultation by the London Stock Exchange, new AIM Rules were published in March 2018. One of the key amendments is in respect of AIM Rule 26 (as set out in AIM Notice 50), which now requires AIM companies to state on their website which recognised corporate governance code they apply and how they have applied that code.

The Board of Directors of Catenae Innovations Plc is committed to developing and applying high standards of corporate governance. The Board of Directors seeks to apply the QCA Code, revised in April 2018 as devised by the Quoted Companies Alliance.

The Quoted Companies Alliance is the independent membership organisation that champions the interests of small to mid-size quoted companies. The QCA Code takes key elements of good governance and applies them in a manner which is workable for the different needs of growing companies.

A revised version of the QCA Code (the “Revised Code”) was published in April 2018, based on the ‘comply or explain’ principle.

The QCA Code is constructed around ten broad principles (accompanied by an explanation of what these principles entail, under ‘application’) and a set of disclosures. The Code states what is considered to be appropriate arrangements for growing companies, and asks companies to provide an explanation about how they are meeting the principles through the prescribed disclosures.

A copy of the Company’s Corporate Governance Statement can be seen here

The table below sets out the principles, the application recommended by the QCA code. It then sets out how the Company complies with these requirements and departures from code, and provides links to appropriate disclosures. These are based upon the recommended disclosures provided in the QCA code.

These disclosures were last reviewed on the 29 January 2020.

PrincipleApplicationHow we comply with the QCA Code in this areaDeparture from Code and Reason
1. Establish a strategy and business model which promote long-term value for shareholdersThe board must be able to express a shared view of the company’s purpose, business model and strategy. It should go beyond the simple description of products and corporate structures and set out how the company intends to deliver shareholder value in the medium to long-term. It should demonstrate that the delivery of long-term growth is underpinned by a clear set of values aimed at protecting the company from unnecessary risk and securing its long-term future.The purpose of the Group is encapsulated in the expression of its mission, which is to provide leading edge technical solutions to multiple sectors where the associated intellectual property is owned and developed by the Group. This will deliver a profitable and highly-valued business and competitive advantages over other providers of similar services.

The key challenges we face include:

  • Communicating changes to business and revised product offerings. We have reviewed our communications strategy and have engaged a leading journalist and a corporate communications organisation (Brand Communications, Brand UK Ltd ) to assist in promotion of the Group utilising both print and a variety of social media platforms. The group also attends relevant investor conferences.
  • Delivering continuous availability – a failure in the group’s systems could lead to an inability to deliver services. This is addressed by operating redundant systems across multiple datacentres and a comprehensive disaster recovery programme.
  • Recruiting and retaining suitable staff – the group’s ability to execute its strategy is dependent on the skills and abilities of its staff. We undertake ongoing initiatives to foster good staff engagement and ensure that remuneration packages are competitive in the market.

We believe we have the correct strategy and services in place to deliver growth in sales over the medium to long term. This will enable us to deliver sustainable shareholder value.

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2. Seek to understand and meet shareholder needs and expectationsDirectors must develop a good understanding of the needs and expectations of all elements of the company’s shareholder base.

The board must manage shareholders’ expectations and should seek to understand the motivations behind shareholder voting decisions.

The Board is committed to communicating openly with its shareholders to ensure that its strategy and performance are clearly understood. We communicate with shareholders through the Annual Report and Accounts, full-year and half-year announcements, trading updates and the Annual General Meeting (AGM), and we encourage shareholder’s participation in face-to-face meetings.

The Board believes that the Annual Report and Accounts, and the Interim Report published at the half-year, play an important part in presenting all shareholders with an assessment of the Group’s position and prospects. All reports and press releases are published on the Group’s website.

The AGM is the principal opportunity for private shareholders to meet and discuss the Group’s business with the Directors. The Notice of Meeting is sent to shareholders at least 21 days before the meeting. The Interim CEO of the Board, together with the other director whenever possible, attends the AGM and are available to answer questions raised by shareholders. Shareholders vote on each resolution, by way of a poll. For each resolution we announce the number of votes received for, against and withheld and subsequently publish them on our website.

There is an open question and answer session during which shareholders may ask questions both about the resolutions being proposed and the business in general. The Directors are also available after the meeting for an informal discussion with shareholders.

In addition, we review analysts’ notes to achieve a wide understanding of investors’ views. This information is considered by the Board when addressing the long-term strategy of the Group and its interaction with stakeholders. Since the period end, the group has engaged Align Research Limited from which it has commissioned the preparation of research that can be made available to all shareholders

As the Company is too small to have a dedicated investor relations department, the Interim CEO is responsible for reviewing all communications received from members and determining the most appropriate response. Please use shareholders@catenaeinnovation.com to register your enquiry.

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3. Take into account wider stakeholder and social responsibilities and their implications for long-term successLong-term success relies upon good relations with a range of different stakeholder groups both internal (workforce) and external (suppliers, customers, regulators and others). The board needs to identify the company’s stakeholders and understand their needs, interests and expectations. Where matters that relate to the company’s impact on society, the communities within which it operates or the environment have the potential to affect the company’s ability to deliver shareholder value over the medium to long-term, then those matters must be integrated into the company’s strategy and business model. Feedback is an essential part of all control mechanisms. Systems need to be in place to solicit, consider and act on feedback from all stakeholder groups.
StakeholderReason for EngagementHow we Engage
Staff – our ability to develop innovative technology and to deliver and fulfil client services relies on having talented and motivated staff.Good two-way communication with staff is a key requirement for high levels of engagement, fostering a culture of innovation.Monthly staff briefings. Invitation to staff to ask questions of management that are answered in the briefings. These have provided insights that have led to enhancement of management practices.
Clients – our success and competitive advantage are dependent upon fulfilling client requirements, particularly in relation to quality of service, its speed of delivery and range of product offerings.Understanding current and emerging requirements of clients and the market generally enables us to develop new and enhanced services, together with appropriate technology and related software to support the fulfilment of those services.Seek feedback on services and software systems.

Obtain fulfilment metrics employed by clients to measure performance.

Obtain requests for new services and service enhancements.

Suppliers – key suppliers are our datacentre hosting providers and providers of some software .Hosting and datacentre services organization provide hosting services for the infrastructure that delivers a number of our service.

We utilise some 3rd party software within our solutions.

We have long term arrangement with multiple providers in geographically diverse locations, to reduce reliance on any one provider.

We ensure we have relevant contractual agreements in place.

Shareholders – as a public company we must provide transparent, easy-to-understand and balanced information to ensure support and confidence.Meeting regulatory requirements and understanding shareholder sentiments on the business, its prospects and performance of management.Regulatory news releases.

Keeping the investor relations section of the website up to date. Participation at investor events.

Annual and half-year reports and presentations.

AGM

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4. Embed effective risk management, considering both opportunities and threats, throughout the organisationThe board needs to ensure that the company’s risk management framework identifies and addresses all relevant risks in order to execute and deliver strategy; companies need to consider their extended business, including the company’s supply chain, from key suppliers to end-customer. Setting strategy includes determining the extent of exposure to the identified risks that the company is able to bear and willing to take (risk tolerance and risk appetite).

The board members have a collective responsibility and legal obligation to promote the interests of the company, and are collectively responsible for defining corporate governance arrangements. Ultimate responsibility for the quality of, and approach to, corporate governance lies with the chair of the board.

The board (and any committees) should be provided with high quality information in a timely manner to facilitate proper assessment of the matters requiring a decision or insight.

The board should have an appropriate balance between executive and non-executive directors and should have at least two independent non-executive directors. Independence is a board judgement.

The board should be supported by committees (e.g. audit, remuneration, nomination) that have the necessary skills and knowledge to discharge their duties and responsibilities effectively. Directors must commit the time necessary to fulfil their roles.

The Board is responsible for putting in place and communicating a sound system to manage risk and implement internal control.

The Board consider the management of risk is an essential business practice and is reviewed and addressed regularly at monthly Board meetings. Within the scope of the annual audit, specific risks are evaluated in detail, including in relation to liquidity, credit, currency, capital and interest rates.

Staff are reminded on a regular basis that they should seek approval from the CEO if they, or their families, plan to trade in the Group’s shares.

Note 16 in the Company’s annual report and accounts lists specific financial risk factors impacting the Company.

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5. Maintain the board as a well-functioning, balanced team led by the chairThe board members have a collective responsibility and legal obligation to promote the interests of the company, and are collectively responsible for defining corporate governance arrangements. Ultimate responsibility for the quality of, and approach to, corporate governance lies with the chair of the board.

The board (and any committees) should be provided with high quality information in a timely manner to facilitate proper assessment of the matters requiring a decision or insight.

The board should have an appropriate balance between executive and non-executive directors and should have at least two independent non-executive directors. Independence is a board judgement.

The board should be supported by committees (e.g. audit, remuneration, nomination) that have the necessary skills and knowledge to discharge their duties and responsibilities effectively. Directors must commit the time necessary to fulfil their roles.

The Board currently consists of two Directors of which one is executive and one is an independent non-executive. The Company is committed to appoint additional non-executive and executive Board members as the business expands.

Guy Meyer, Interim CEO
Kevin Everett, Non-executive Director

In addition, the board is supported by the Company Secretary, who also acts as in house legal counsel. Albeit the board as currently structured does not meet the recommendations of the Code (that is to say having 2 non-executive directors) the board believes that it still operates effectively and re-emphasises its commitment to appoint a further non-executive director when the opportunity arises.

The members of the Board have a collective responsibility and legal obligation to promote the interests of the Group and are collectively responsible for defining corporate governance arrangements. Ultimate responsibility for the quality of, and approach to, corporate governance lies with the CEO.

The Board has considered succession planning for Board members and has concluded that given the current size of the Company it is impractical to consider a traditional succession plan. This decision will be reviewed on an annual basis.

Non-executive directors are required to attend 10-12 board meetings per year in London and to be available at other times as required for face-to-face and telephone meetings with the executive team (and investors where appropriate).

The Board meets on a monthly basis, with additional phone meetings occurring as needed. Minutes of each meeting are provided to all Board members for review.

Meetings held during the 12 month period under review and the attendance of the directors is summarised below:

Board Possible
Executive Directors
Guy Meyer12/12
Non-Executive Directors
Kevin Everett10/12

The Company has a remuneration committees and an audit committee, both of which are chaired by the Non-executive director.

The Audit Committee considers the annual and interim financial statements and the audit plan. The
Audit Committee is responsible for ensuring that appropriate financial reporting procedures are
properly maintained and reported upon, reviewing accounting policies and for meeting the auditors
and reviewing their reports relating to the financial statements and internal control systems.

The Remuneration Committee is responsible for reviewing the performance of the senior executives
and for determining their levels of remuneration.

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6 Ensure that between them the directors have the necessary up-to-date experience, skills and capabilitiesThe board must have an appropriate balance of sector, financial and public markets skills and experience, as well as an appropriate balance of personal qualities and capabilities.

The board should understand and challenge its own diversity, including gender balance, as part of its composition.

The board should not be dominated by one person or a group of people. Strong personal bonds can be important but can also divide a board.

As companies evolve, the mix of skills and experience required on the board will change, and board composition will need to evolve to reflect this change.

All members of the Board bring relevant sector experience to the Company within the media and technology sector.

The Board believe that the blend of relevant experience, skills and personal qualities and capabilities is sufficient to enable it to successfully execute its strategy. Directors attend seminars and other regulatory and trade events to ensure that their knowledge remains current.

Shareholders are given the opportunity to re-elect Directors at the Annual General Meeting of the Company. Any Directors appointed since the last AGM are open to shareholder vote along with one third of the existing Directors and all Directors are re-elected at least every 3 years.

A profile of each of the Directors of the Company is set out below

Guy Meyer – Interim CEO

Guy ran his own cross-platform marketing agency, Firebelly, for nearly 20 years as CEO. Firebelly provided award-winning marketing strategies, content creation and execution services mainly in the entertainment and publishing sectors. Operating across traditional and digital media, he is experienced in business strategy formulation, sales & marketing. His clients included The Walt Disney Company, HarperCollins, Lionsgate, Paramount Pictures and Universal Pictures International. He sold Firebelly in 2013 to concentrate on business consulting where he worked globally mainly with Sales teams helping them expand and accelerate their sales pipelines in verticals that included Financial Services, Government and Telecoms.

Guy was appointed as Interim CEO on 18th July 2019.

Kevin Everett – Non-Executive Director

Kevin has extensive strategic, operational and financial experience, balancing professional and charitable careers, with a focus on business and education. He has vast experience in connecting foundations with the corporate sector.

Kevin is currently Treasurer and Chairman of the board for the Sir John Cass Foundation. During 23 years on the board, he has led the restructuring of the Foundation, increasing their assets from £16m to £120m. His early support for specialist schools, combined with his belief in the model of integrating education and employers, has helped increase the Foundation’s grant capacity and benefit from £300k to over £5m.

Kevin was appointed as a Non-Executive Director on 16th May 2013.

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7. Evaluate board performance based on clear and relevant objectives, seeking continuous improvementThe board should regularly review the effectiveness of its performance as a unit, as well as that of its committees and the individual directors.

The board performance review may be carried out internally or, ideally, externally facilitated from time to time. The review should identify development or mentoring needs of individual directors or the wider senior management team. It is healthy for membership of the board to be periodically refreshed. Succession planning is a vital task for boards. No member of the board should become indispensable.

The board currently does not have a formal evaluation process. The board is committed to implement a formal review process in next 12 months. The board does review its performance on an informal basis in an ad-hoc manner.

As a result of the reviews that have occurred a number of refinements in working practices were identified as a result of this exercise and have since been adopted.

The Company has yet to carry out a formal assessment of board effectiveness.

The board will keep this under consideration and put in place procedures when it is felt appropriate.

8. Promote a corporate culture that is based on ethical values and behavioursThe board should embody and promote a corporate culture that is based on sound ethical values and behaviours and use it as an asset and a source of competitive advantage.

The policy set by the board should be visible in the actions and decisions of the chief executive and the rest of the management team.

Corporate values should guide the objectives and strategy of the company. The culture should be visible in every aspect of the business, including recruitment, nominations, training and engagement. The performance and reward system should endorse the desired ethical behaviours across all levels of the company.

The corporate culture should be recognisable throughout the disclosures in the annual report, website and any other statements issued by the company

The Company maintains and annually reviews a Staff Handbook that includes clear guidance on what is expected of every employee and officer of the Company.

Adherence of these standards is a key factor in the evaluation of performance within the company, including during annual performance reviews.

The Company also adopts five core values which it believes is at the heart of delivering long-term growth being:

  1. We place our customers first, putting ourselves in their shoes to understand the current and future needs of those who use our products and services, and always striving to exceed their expectations.
  2. We have an enduring positive attitude that stems from being self-motivated, adaptable and agile and feeling fully empowered to make a difference, speaking out with ideas and suggestions to make things better.
  3. We are team players who recognise that the Company is a company worth much more than the sum of its parts, we are passionate about communicating with colleagues and with our customers and are committed to learning from one another
  4. We are committed to innovation in what we do and how we do it, as well as to working smarter rather than harder to reduce costs, increase efficiency and make lives easier by being creative, pragmatic and different.
  5. We respect one another and are courteous, honest and straightforward in all our dealings. We honour diversity, individuality and personal differences, and are committed to conducting our business with the highest personal, professional and ethical standards.

The board believes that a culture that is based on the five core values is a competitive advantage and consistent with fulfilment of the group’s mission and execution of its strategy.

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9. Maintain governance structures and processes that are fit for purpose and support good decision-making by the boardThe company should maintain governance structures and processes in line with its corporate culture and appropriate to its:

  • size and complexity; and
  • capacity, appetite and tolerance for risk.

The governance structures should evolve over time in parallel with its objectives, strategy and business model to reflect the development of the company.

The Board meets regularly to determine the policy and business strategy of the Group and has adopted a schedule of matters that are reserved as the responsibility of the Board. Its purpose is to ensure the delivery of long-term shareholder value, which involves setting the culture, values and practices that operate throughout the business, and defining the strategic goals that the Group implements.

The Interim Chief Executive Officer leads the development of business strategies within the Group’s operations.

The Board has considered mechanisms by which the business and the financial risks facing the Group are managed and reported to the Board. The principal business and financial risks have been identified and control procedures implemented.

The Board acknowledges its responsibility for reviewing the effectiveness of the systems that are in place to manage risk and to provide reasonable but not absolute assurance with regard to the safeguarding of the Group’s assets against misstatement or loss.

The Board currently consists of one Executive Director and one Non-executive Director. It is the Board’s intention to appoint additional Directors as the business expands. The Board considers that there will be an appropriate balance between the Executives and Non-executives and that no individual or small group dominates the Board’s decision making.

The Board’s members have a wide range of expertise and experience and it is felt that concerns may be addressed to the Non-executive Director.

The Board has delegated certain authorities to the audit and remuneration committees, each with formal terms of reference.

Internal Controls
The Board has ultimate responsibility for the Group’s system of internal control and for reviewing its effectiveness. However, any such system of internal control can provide only reasonable, but not absolute, assurance against material misstatement or loss.

The Board considers that the internal controls in place are appropriate for the Group. The principal elements of the Group’s internal control system for which the Board has responsibility include:

  • Close management of the day to day activities of the Group by the executive Directors;
  • An organisational structure with defined levels of responsibility, which promotes entrepreneurial decision making and rapid implementation whilst minimising risks;
  • A comprehensive annual budgeting process producing a detailed integrated profit and loss, balance sheet and cash flow, which is approved by the Board;
  • Detailed monthly reporting of performance against budget; and
  • Central control over key areas such as capital expenditure authorisation and banking facilities.

The Group continues to review its system of internal control to ensure compliance with best practice.

The Board considers that the introduction of an internal audit function is not appropriate at this juncture.

The matters reserved for the Board are:

  • Setting long-term objectives and commercial strategy;
  • Approving changes to the Board structure;
  • Approving resolutions to be put to general meetings of shareholders and the associated documents or circulars;
  • Approving dividend policy and the declaration of dividends;
  • Approving major investments, disposals, capital projects or contracts;
  • Changing the share capital or corporate structure of the Group; and
  • Approving half-year and full-year results and reports.

The Board has approved the adoption of the QCA Code as its governance framework against which this statement has been prepared and will monitor the suitability of this code on an annual basis and revise its governance framework as appropriate as the group evolves.

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10. Communicate how the company is governed and is performing by maintaining a dialogue with shareholders and other relevant stakeholdersA healthy dialogue should exist between the board and all of its stakeholders, including shareholders, to enable all interested parties to come to informed decisions about the company.

In particular, appropriate communication and reporting structures should exist between the board and all constituent parts of its shareholder base.

This will assist:

  • the communication of shareholders’ views to the board; and
  • the shareholders’ understanding of the unique circumstances and constraints faced by the company.

It should be clear where these communication practices are described (annual report or website).

The Board appreciates the importance of good communications with Shareholders and other relevant stakeholders.

The Company website is regularly updated to ensure the communications are available to all.

The Group financial statements and notices of General Meetings of the Company can be found here.

The results of voting on all resolutions in future general meetings will be posted to the Group’s website, including any actions to be taken as a result of resolutions for which votes against have been received from at least 20 percent of independent shareholders.

Shareholders are welcome to contact the Company at 199 Bishopsgate, London EC2M 3TY to discuss any relevant matters with the board.

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Shares

There are 32,236,017 issued Ordinary shares of 0.2 pence nominal value each and 32,236,017 Deferred shares . There are 8,333,333 shares held in the share reserve and there are no restrictions on the transfer of Catenae’s ordinary shares. The securities of Catenae are traded on AIM, the market of that name operated by London Stock Exchange PLC, and also on the Social Stock Exchange. The Company has not applied or agreed to have any of its securities (including AIM securities) admitted or traded on any other exchanges or trading platforms.

Warrants

The Company has a total of 723,131,460 warrants over ordinary shares in issue.

Options

The Company has a total of 162,702,116 options over ordinary shares in issue.

Share Price

Share price information on the Company is available on the London Stock Exchange website here.

Please note all share price information is subject to a delay of at least 15 minutes.

Significant Shareholders

At close of business on 12/09/2019, the following Shareholders had an interest in 3 per cent or more of the Company’s ordinary shares. No other person’s had, at that time, reported an interest in 3 per cent or more of the Company’s ordinary shares (please note all percentages are rounded). Any significant transactions in shares which have been notified to the Company since 12/09/2018 are set out in the Investor News.

ShareholderShares HeldPercentage
Venkata Ramesh Para52,262,690 16.47%
Edward Guy Meyer 11,045,829  3.48%
Tony Sanders  10,728,750  3.38%

Percentage of securities not in public hands

At close of business on 05/03/2019, approximately 23.33% of the Company’s shares were not in public hands, representing the shares beneficially held by current Directors (or their connected parties) and any groups with a beneficial interest in 10% or more of the Company’s total issued share capital.

Brief History

The above information is being disclosed for the purposes of Rule 26 of the AIM Rules for Companies. Please note that the contents of this website do not constitute an invitation to invest in the shares of Catenae Innovation Plc.

Certain documents are not to be distributed outside of the UK as described on the cover of such documents. Failure to comply with the restrictions of such documents may constitute a violation of securities laws in non-UK jurisdictions.

Terms and Conditions

Full Terms and Conditions can be found by clicking here.

This information is being disclosed to satisfy the requirements of AIM Rule 26 of the London Stock Exchange – Alternative Investment Market (AIM).