BG (BRGYY) 20-F 2005 FY Annual report (foreign)

Exhibit 1.2

Company Number: 3690065

The Companies Acts 1985 and 1989

A Public Company Limited by Shares

ARTICLES OF ASSOCIATION

(Adopted on 20 April 2001 pursuant to a special resolution passed on 19 April 2001 and further amended pursuant to special resolutions passed on 29 April 2002, 21 May 2004 and 4 May 2005)

of

BG GROUP PLC

PRELIMINARY

1	Table A and other standard regulations do not apply
	Theregulationsin Table A of the Companies (Tables A to F) Regulations 1985, and any similarregulationsin any otherlegislationrelating tocompanies, do not apply to the Company.
2	The meaning of the Articles
2.1	The following table gives the meaning of certain words and phrases as they are used in theseArticles. However, the meaning given in the table does not apply if that meaning is inconsistent with the context in which a word or phrase appears. After theArticlesthere is a glossary which explains various words and expressions. The Glossary also explains some of the words in the Memorandum. But the Glossary is not part of the Memorandum orArticles, and it does not affect their meaning. The words which are explained in theArticlesare printed inboldand those which are explained in the Glossary are printed initalics.

Words	Definitions
alternate director	Has the meaning set out in Article 117.1.
amount (of a share)	This refers to the nominal value of the share.
Articles	The Company’s Articles of Association, including any changes made to them.
class meeting	Has the meaning set out in Article 36.1.

1 May 2005

clear days	In relation to the period of a notice, that period excluding the day when the notice is given or deemed to be given and the day for which it is given or on which it is to take effect.
Companies Act	The Companies Act 1985 as amended by the Companies Act 1989.
committee	Includes a sub-committee.
company	Includes any corporate body.
company representative	Has the meaning set out in Article 78.1
Company Secretary	Any person appointed by the Directors to do work as the company secretary including any assistant or deputy secretary.
the Company	BG Group plc.
CREST Regulations	The Uncertificated Securities Regulations 2001.
electronic communication	Has the meaning set out in Section 15 of the Electronic Communications Act 2000.
electronic mail	Includes any electronic communication in any form through any medium (including transmission through the internet or by fax).
Equal Ranking Shares	Has the meaning set out in Article 38.
equity securities	Has the meaning set out in Section 94 of the Companies Act
equity shares	Shares in the capital of the Company which are regarded as equity share capital pursuant to Section 744 of the Companies Act.
existing shares (of any kind)	Shares which are in issue at the relevant time.
the Group	The Company and any subsidiary or subsidiaries of the Company.
legislation	The Companies Act, and all other laws and regulations applying to the Company.
London Stock Exchange	London Stock Exchange plc.
non equity securities	Securities which are not equity securities.
Operator	CRESTCO Limited or any other operator of a relevant system under the CREST Regulations.
Ordinary Shareholder	A holder of the Company’s Ordinary Shares.
Ordinary Shares	Ordinary shares of 10 pence each in the Company.
paid-up share or other security	Includes a share or other security which is treated (credited) as paid up.

2 May 2005

	pay	Includes any kind of reward or payment for services.
	proxy form	Includes any document or electronic communication which appoints a proxy.
	recognised clearing house	A clearing house granted recognition under the Financial Services and Markets Act 2000.
	recognised investment exchange	An investment exchange granted recognition under the Financial Services and Markets Act 2000.
	Register	The Company’s register of members.
	Registered Office	The Company’s registered office.
	relevant securities	Has the meaning set out in Section 80 of the Companies Act.
	relevant system	Has the meaning set out in the CREST Regulations.
	Seal	The Company’s Common Seal, or any official seal kept by the Company under Section 40 of the Companies Act (called a securities seal).
	shareholder	A holder of the Company’s shares.
	shareholders’ meeting	Includes both a General Meeting of the Company and a meeting of any class of holders of the Company’s shares.
	subsidiary	A “subsidiary undertaking”, as defined in Section 258 of the Companies Act.
	terms of a share	The terms on which a share was issued.
	treasury shares	Shall be construed in accordance with Section 162A of the Companies Act, as amended by the Treasury Shares Regulations.
	Treasury Shares Regulations	The Companies (Acquisition of Own Shares) (Treasury Shares) Regulations 2003.
	UK Listing Authority	The Financial Services Authority in its capacity as the competent authority under the Financial Services and Markets Act 2000.
	Uncertificated Proxy Instruction	A properly authenticated, dematerialised instruction, and/or other instruction or notification, sent by means of a relevant system to such participant in that system acting on behalf of the Company as the Directors may prescribe, in such form and subject to such terms and conditions as may from time to time be prescribed by the Directors (subject always to the facilities and requirements of the relevant system).
	United Kingdom	Great Britain and Northern Ireland.
2.2	References to a debenture include debenture stock and references to a debenture holder include a debenture stockholder.

3 May 2005

2.3	Where the Articles refer to a person who is automatically entitled to a share by law, this includes a person who is entitled to the share as a result of the death, or bankruptcy, of a shareholder.
2.4	Words which refer to a single number also refer to plural numbers, and the other way around.
2.5	Words which refer to the masculine gender include the feminine gender.
2.6	References to other and otherwise are not to be construed as if they apply only to things which are of the same kind or nature as the particular things which precede the reference to other or otherwise.
2.7	References to a person include individuals, companies, unincorporated associations and other similar entities.
2.8	Any headings in these Articles are only included for convenience. They do not affect the meaning of the Articles.
2.9	When an Act, or a section of an Act, is referred to, this includes any amendment to the Act or section, as well as its inclusion in a later Act. Where any rules or regulations are referred to, this includes any amendment to those rules or regulations or any re-issue of them.
2.10	Where these Articles are referred to, the version which is current at any particular time will apply.
2.11	Where the Articles give any power or authority to anybody, this power or authority can be used on any number of occasions, unless the way in which the word is used does not allow this meaning.
2.12	Any word which is defined in the Companies Act or the CREST Regulations means the same in the Articles, unless the Articles define it differently, or the way in which the word is used is inconsistent with the definition given in the Companies Act or the CREST Regulations.
2.13	Where the Articles say that anything can be done by passing an ordinary resolution, this can also be done by passing a special resolution or an extraordinary resolution.
2.14	Where the Articles refer to changing the amount of shares this means doing any or all of the following:
	•	subdividing the shares into other shares with a smaller nominal amount;
	•	consolidating the shares into other shares with a larger nominal amount; and
	•	dividing shares which have been consolidated into shares with a larger nominal amount than the original shares had.
2.15	Where the Articles refer to any document being made effective this means being signed, sealed or executed in some other legally valid way.
2.16	Where the Articles refer to months or years, these are calendar months or years.
2.17	Articles which apply to fully-paid shares can also apply to stock. References in those Articles to share or shareholder include stock or stockholder.
2.18	Where the Articles refer to shares in certificated form this means that ownership of the shares can be transferred using a written transfer document (rather than in accordance with the CREST Regulations) and that a share certificate is usually issued to the owner.

4 May 2005

2.19	Where the Articles refer to shares in uncertificated form this means that ownership of the shares can be transferred in accordance with the CREST Regulations without using a written transfer document and that no share certificate is issued to the owner.
2.20	References to officers include Directors, alternate directors, managers and the Company Secretary, but not the Company’s auditors.
2.21	The term address, when used in relation to electronic communications, includes any number or address (including, in the case of any Uncertificated Proxy Instruction permitted under Article 78.4, an identification number of a participant in the relevant system) used for the purposes of such communication.
SHARE CAPITAL
3	Form of the Company’s share capital
	The Company’s share capital at the date when these Articles were adopted was £500,000,001, made up of 5,000,000,010 Ordinary Shares.
CHANGING CAPITAL
4	The power to increase capital
	The Company’s shareholders can increase the Company’s share capital by passing an ordinary resolution. The resolution must fix the amount of the increase and the nominal value of the new shares and the currency or currencies of the shares.
5	Application of the Articles to new shares
	The provisions of theArticlesaboutallotment, payment ofcalls, transfer,automatic entitlement by law,forfeiture,lienand all other things apply to new shares under Article 4 in the same way as if they were part of theCompany’sexisting share capital.
6	The power to change capital
	The shareholders can pass ordinary resolutions to do any of the following:
	•	to consolidate, or consolidate and then divide, all or any of the Company’s share capital into new shares of a larger nominal value than the existing shares;
	•	to cancel any shares which have not been taken, or agreed to be taken, by any person at the date of the resolution, and reduce the amount of the Company’s share capital by the amount of the cancelled shares;
	•	to divide some or all of the Company’s share capital into shares which are of a smaller nominal value than is fixed in the Memorandum. This is subject to any restrictions under the legislation. The resolution may provide that, as between the holders of the divided shares, different rights and restrictions which the Company can apply to new shares may apply to all or any of the different divided shares.

5 May 2005

7	Fractions of shares
7.1	If any shares areconsolidatedor divided, the Directors have the power to deal with any fractions of shares which result. If the Directors decide to sell any shares representing fractions, they can do so for the best price reasonably obtainable and distribute the net proceeds of sale amongmembersin proportion to their fractional entitlements in accordance with their rights and interests. The Directors can sell to anyperson(including theCompany, iflegislationallows this) and can authorise anypersonto transfer those shares to the buyer or in accordance with the buyer’s instructions. The buyer does not need to take any steps to see how any money he is paying is used. Nor will his ownership be affected if the sale was irregular or invalid in any way.
7.2	So far aslegislationallows, when shares areconsolidatedor divided, the Directors can treat ashareholder’sshares which are held incertificated formand inuncertificated formas separate shareholdings. The Directors can also arrange for any shares which result from aconsolidationor division and which represent rights to fractions of shares to be entered in theRegisteras shares incertificated formwhere this makes it easier to sell them.
8	The power to reduce capital
	TheCompany’s shareholderscan pass aspecial resolutionto:
	•	reduce theCompany’sshare capital in any way; or
	•	reduce anycapital redemption reserve, share premium account, or other undistributable reserve in any way.
		This issubject toany restrictions under theCompanies Act.
9	Buying back shares
9.1	TheCompanycan buy back, or agree to buy back in the future, any shares of any class (includingredeemableshares), if thelegislationallows this. However, if theCompanyhasexisting shareswhich are admitted to the official list maintained by theUK Listing Authorityand to trading on theLondon Stock Exchangeand which are convertible into other shares which areequity shares, then theCompanycan only buy backequity sharesof that class if:
	•	either the terms ofissueof the convertible shares permit theCompanyto buy back theequity shares; or
	•	the buy-back or agreement to buy back has been approved by anextraordinary resolutionpassed by the holders of the convertible shares at a separateclass meeting.
9.2	TheCompanymay not exercise any right in respect oftreasury sharesheld by it, including any right to attend or vote atGeneral Meetings, to participate in any offer by theCompanytoshareholdersor to receive any distribution (including in a winding-up), but without prejudice to its right to sell thetreasury shares, to receive anallotmentofequity sharesas fully paid bonus shares in respect of thetreasury sharesor to receive any amount payable on redemption of any redeemabletreasury shares.

6 May 2005

SHARES

10	The special rights of new shares
10.1	If theCompanyissuesnew shares, the new shares may have any rights or restrictions attached to them. The rights can take priority over therightsofexisting shares, orexisting sharescan take priority over them, or the new shares and theexisting sharescanrankequally. These rights and restrictions can apply to sharing in theCompany’sprofits orassets. Other rights and restrictions can also apply, for example on the right to vote.
10.2	The rights and restrictions referred to in Article 10.1 can be decided by anordinary resolutionpassed by theshareholders. The Directors can also take these decisions if they do not conflict with any resolution passed by theshareholders.
10.3	If thelegislationallows this, therightsof any new shares can include rights for the holder and/or theCompanyto have themredeemed.
10.4	The ability to attach particular rights and restrictions to new shares may be restricted byspecial rightspreviously given to holders of anyexisting shares.
11	The Directors’ power to deal with shares
11.1	The Directors can decide how to deal with any shares which have not beenissuedor which constitutetreasury shares. The Directors can:
	•	allotor sell them on any terms, which can include the right to transfer theallotmentto anotherpersonbefore anypersonhas been entered on theRegister.This is known as the right torenouncetheallotment(see also Article 14);
	•	grant options to give people a choice to acquire shares in the future; or
	•	dispose of the shares in any other way.
11.2	The Directors are free to decide who they deal with, when they deal with the shares, and the terms on which they deal.
11.3	For the purposes of Article 11.1, the Directors must comply with:
	•	the provisions of thelegislationrelating to authority,pre-emption rightsand other matters; and
	•	any resolution of aGeneral Meetingwhich is passed under thelegislation.
12	The Directors’ authority to allot “relevant securities” and “equity securities” and sell treasury shares
12.1	This Article regulates the authority of the Directors toallotrelevant securitiesand their power toallotequity securitiesand selltreasury shareswholly for cash.
12.2	The Directors are authorised, generally and without conditions, under Section 80 of the Companies Act, to allot relevant securities. They are authorised to allot equity securities, for any prescribed period. The maximum amount of relevant securities which the Directors can allot in each prescribed period is the Section 80 Amount.
12.3	Under the Directors’ general authority in Article 12.2, they have the power toallotequity securitiesand selltreasury shares, entirely paid for in cash, free of the restriction in Section

7 May 2005

	89(1) of theCompanies Act. They have the power toallotequity securities, and selltreasury shares, for anyprescribed period. There is no maximum amount ofequity securitiesortreasury shareswhich the Directors canallotor sell, respectively when theallotmentor sale is in connection with arights issue. In all other cases, the maximum aggregate amount ofequity securitieswhich the Directors canallot, ortreasury shareswhich the Directors can sell is theSection 89 Amount.
12.4	During anyprescribed period, the Directors can make offers and enter into agreements which would, or might, require shares or othersecuritiesto beallotted,ortreasury sharesto be sold, after that period has ended.
12.5	For the purposes of this Article:
	•	rights issuemeans an offer ofequity securitieswhich is open for a period decided on by the Directors to the people (other than theCompany) who are registered on a particular date (chosen by the Directors) as holders of:
		(i)	Ordinary Shares, in proportion to their holdings ofOrdinary Shares; and
		(ii)	other classes ofequity securitiesornon equity securitieswhich give them the right to receive the offer in accordance with their rights.
		However, the Directors can do the following things (and theissuewill still be treated as arights issuefor the purpose of this Article if they do so):
		•	sell any fractions of equity securities to which people would be entitled and keep the net proceeds for the Company’s benefit or make other appropriate arrangements to deal with such fractions;
		•	make the rights issue subject to any limits or restrictions which the Directors think are necessary or appropriate to deal with legal or practical problems under the laws of any territory, or under the requirements of any recognised regulatory body, or stock exchange, in any territory or as a result of shares being represented by American Depositary Shares; or
		•	treat a shareholder’s holdings in certificated form and uncertificated form as separate shareholdings.
	•	prescribed period means in the first instance the period ending on the date of the Annual General Meeting in 2004 or on 7 October 2004, whichever is earlier. After this, the prescribed period means a period of no more than five years fixed by the shareholders by passing a resolution at a General Meeting2 . The shareholders can, by passing further resolutions, renew or extend this power (including the first prescribed period), for periods of no more than five years each. Such resolutions can take the form of:
		•	an ordinary resolution fixing a period under Article 12.2; or
		•	a special resolution fixing a period under Article 12.3; or
		•	a special resolution fixing identical periods under Article 12.2 and under Article 12.3; or

² By an ordinary resolution passed on 4 May 2005 the next prescribed period will end on the date of the Annual General Meeting of the Company in 2006 or on 4 August 2006, whichever is earlier.

8 May 2005

• aspecial resolutionfixing different periods under Article 12.2 and under Article 12.3.

• The Section 80 Amount for the first prescribed period is £467,400,000³ . For any subsequent prescribed period the Section 80 Amount is that stated in a relevant resolution passed by the shareholders at a General Meeting.

• The Section 89 Amount for the first prescribed period is £17,525,000⁴ . For any subsequent prescribed period the Section 89 Amount is that stated in a relevant special resolution passed by the shareholders at a General Meeting.

• In working out any maximum amounts of securities referred to in this Article, the nominal value of rights to subscribe for shares, or to convert any securities into shares, will be taken as the nominal value of the shares which would be allotted if the subscription or conversion takes place.

13	Power to pay commission and brokerage
13.1	TheCompanycan use all the powers given by thelegislationto pay commission orbrokerageto anypersonwho:
	•	applies, or agrees to apply, for any new shares; or
	•	gets anybody else to apply, or agree to apply for, any new shares.
13.2	The rate per cent. or amount of the commission paid or agreed to be paid must be disclosed and made as required by thelegislationand may be paid in either cash, by theallotmentof fully orpartly paidup shares, any combination of the two or in any other way allowed by thelegislation.
14	Renunciations of allotted but unissued shares
	Where a share has beenallottedto apersonbut thatpersonhas not yet been entered on theRegister, the Directors can recognise a transfer (called arenunciation) by thatpersonof his right to the share in favour of some otherperson. The ability torenounce allotmentsonly applies if the terms on which the share isallottedare consistent withrenunciation. The Directors can impose terms and conditions regulatingrenunciationrights.
15	No trusts or similar interests recognised
15.1	TheCompanywill only be affected by, or recognise, a current and absolute right to whole shares. The fact that any share, or any part of a share, may not be owned outright by the registered owner is not of any concern to theCompany, for example if a share is held on any kind oftrust.
15.2	The only exception to what is said in Article 15.1 is for any right:
	•	which is expressly given by theseArticles; or
	•	which theCompanyhas a legal duty to recognise.

³ By an ordinary resolution passed on 4 May 2005 the Section 80 amount for the next prescribed period is £123,368,432.

⁴ By a special resolution passed on 4 May 2005 the Section 89 amount for the next prescribed period is £17,692,165.

9 May 2005

SHARES IN UNCERTIFICATED FORM

16	Shares without certificates, and shares which can be transferred without transfer forms
16.1	TheCompanycanissueshares, and othersecurities, which do not have certificates. TheCompanycan also allowexisting shares, and othersecurities, to be held without certificates. Evidence of ownership of these shares and securities does not involve a certificate. The Company can also allow any shares, or other securities, to be transferred without using a transfer form. All this applies so far as the legislation allows.
16.2	These shares and othersecuritiescan, for example, be transferred by using arelevant system, as defined in theCREST Regulations.Shares which can be transferred in this way are calleduncertificated shares.
16.3	Immediately before any of theCompany’sshares becomeuncertificated shares, theArticleswill only apply to those shares so far as they are consistent with:
	•	holding those shares asuncertificated shares;
	•	transferring ownership of those shares by using arelevant system; and
	•	any of the provisions of theCREST Regulations.
16.4	The Directors can also lay down regulations:
	•	which govern theissue, holding and transfer, and where appropriate, the mechanics of conversion andredemption, of these shares andsecurities;
	•	which govern the mechanics for payments involving arelevant system; and
	•	which make any other provisions which the Directors consider are necessary to ensure that theseArticlesare consistent with theCREST Regulations, and with anyrulesor guidance of anOperatorof arelevant systemunder theCREST Regulations.
	These regulations will, if they say so, apply instead of the other provisions in theArticlesrelating to certificates, and the transfer, conversion andredemptionof shares and othersecurities, and any other provisions which are not consistent with theCREST Regulations. If the Directors do make any regulations under this Article 16.4, Article 16.3 will still apply to theArticles, read with those regulations.

SHARE CERTIFICATES

17	Certificates
17.1	When ashareholderis first registered as the holder of any class of shares incertificated form, he is entitled, free of charge, to a separate share certificate for each class of shares he holds incertificated form. If he holds shares of more than one class incertificated form, he is entitled to receive a separate share certificate for each class.
17.2	TheCompanymust also observe any requirements of theCREST Regulationswhen issuing share certificates. Where thelegislationallows, theCompanydoes not need to issue share certificates.

10 May 2005

17.3	If ashareholderreceives more shares incertificated formof any class, he is entitled, without charge, to another certificate for the extra shares.
17.4	If ashareholdertransfers part of his shares covered by a certificate, he is entitled, free of charge, to a new certificate for the balance if the balance is also held incertificated form. The old certificate will be cancelled.
17.5	TheCompanydoes not have to issue more than one certificate for any share incertificated form, even if that share is held jointly.
17.6	When theCompanydelivers a certificate to one jointshareholderholding shares incertificated form, this is treated as delivery to all of the jointshareholders.
17.7	TheCompanycan deliver a certificate to a broker oragentwho is acting for apersonwho is buying the shares incertificated form, or who is having the shares transferred to him incertificated form.
17.8	The Directors can decide how share certificates aremade effective. For example, they can be:
	•	signed by one or more Directors;
	•	sealed with theSeal(or in the case of shares on a branch register, an official seal for use in the relevant territory); or
	•	printed, in any way, with a copy of theSealor with a copy of the signature of one or more Directors. The copy can be made or produced mechanically, electronically or in any other way the Directors approve as long as it complies with thelegislation.
17.9	A share certificate must state the number and class of shares to which it relates, theirnominal valueand the amount paid up on those shares. It cannot be for shares of more than one class.
17.10	The time limit for theCompanyto provide a share certificate incertificated formunder this Article 17 is:
	•	onemonthafter theallotmentof a new share (or any longer period provided by its terms of issue);
	•	five business days after a transfer offully paid sharesis presented for registration; or
	•	twomonthsafter a transfer ofpartly paid sharesis presented for registration.
17.11	Share certificates will also be prepared and sent earlier where either theLondon Stock Exchangeor theUK Listing Authorityrequires it.
18	Replacement share certificates
18.1	If ashareholderhas two or more share certificates for shares of the same class which are incertificated form, he can ask theCompanyfor these to be cancelled and replaced by a single new certificate. TheCompanymust comply with such request, without making a charge for doing so.
18.2	Ashareholdercan ask theCompanyto cancel and replace a single share certificate with two or more certificates, for the same total number of shares. TheCompanymay comply with such request and the Directors may require theshareholderto pay a reasonable sum to theCompanyfor doing so.

11 May 2005

18.3	Ashareholdercan ask theCompanyfor a new certificate if the original is:
	•	damaged or defaced; or
	•	alleged to be lost, stolen or destroyed.
18.4	If a certificate has been damaged or defaced, theCompanycan require the certificate to be delivered to it before issuing a replacement. If a certificate is alleged to be lost, stolen or destroyed, theCompanycan require satisfactory evidence, and anindemnity, before issuing a replacement.
18.5	The Directors can require theshareholderto pay a reasonable sum for issuing any share certificates following a request under Article 18.3.
18.6	Any one jointshareholdercan request replacement certificates under this Article 18.
CALLS ON SHARES

19	The Directors can make calls on shares
	The Directors cancallonshareholdersto pay any money which has not yet been paid to theCompanyfor their shares. This includes both thenominal valueof the shares and anypremiumwhich may be payable. They can also makecallsonpeoplewho areautomatically entitled to shares by law. If the terms ofissueof the shares allow this, the Directors can:
	•	makecallsas often, and whenever, they think fit;
	•	decide when and where the money is to be paid;
	•	decide that the money may be paid by instalments;
	•	wholly or partlyrevokeor postpone anycall.
	Acallis treated as having been made as soon as the Directors pass a resolution authorising it.
20	The liability for calls
	Ashareholderwho has received at least 14 days’ notice giving the amountcalled, the time (or times) and place for payment must pay thecallas required by the notice. Jointshareholdersareliable jointly and severallyto pay any moneycalledfor. Ashareholderwho transfers shares after acallis made on them remains liable for thatcall.
21	Interest and expenses on unpaid calls
	If thepersondue to pay any moneycalledfor in this way does not pay it by the day that it is due, he is liable to pay interest on the money and any expenses incurred by theCompanybecause of his failure to pay thecallon time. This interest will run from the day the money is due until it has actually been paid. The yearly interest rate is that fixed by the Directors (subject toa maximum of 15 per cent) or, if no rate is fixed, at the appropriate rate (as defined by theCompanies Act) but the Directors can decide to forgo any or all of this interest or expenses.
22	Sums which are payable when a share is allotted are treated as a call
	If theterms of a sharerequire any money to be paid at the time the share isallotted, or at any fixed date, then this money will be treated in the same way as a validcallfor money on shares which is due on the same date. If this money is not paid, everything in theArticlesrelating to

12 May 2005

	non-payment ofcallsapplies. This includes Articles which allow theCompanytoforfeitor sell shares and to claim interest.
23	Calls can be for different amounts
	On or before anissueof shares, the Directors can decide thatshareholdersmay becalledon to pay different amounts, or that they may becalledon at different times.
24	Paying calls early
24.1	The Directors can accept payment in advance of some or all of the money due from ashareholderbefore he iscalledon to pay the money andliabilityon the shares in respect of which the payment is made shall be extinguished to the extent of that payment. The Directors can agree to pay interest on money paid in advance (up to a maximum yearly interest rate of 15 per cent.) until it would otherwise be due to theCompanyat a rate fixed by the Directors.
24.2	Where money is paid in advance on shares in this way it will be ignored in calculating the dividend payable on those shares.
FORFEITING SHARES AND LIENS OVER SHARES

25	Notice following non-payment of a call
25.1	Articles 25 to 35 apply if ashareholderfails to pay the whole amount of acall, or an instalment of acall, by the day that it is due. They also apply in the same way to apersonwho isautomatically entitled to a share by law.The Directors can serve a notice on him any time after the date it is due, if the whole amount immediately due has not been paid. This notice must comply with Article 26.
26	Contents of the notice
	The notice referred to in Article 25 must:
	•	demand payment of the amount immediately payable, plus any interest and any of theCompany’sexpenses caused by the failure to pay;
	•	give a date by when the total referred to immediately above must be paid, but this must be at least 14clear daysafter the notice is served on theshareholder;
	•	state where the payment must be made; and
	•	state that if the full amount demanded is not paid by the time and place stated, theCompanycanforfeitthe shares on which thecallor instalment was due.
27	Forfeiture if the notice is not complied with
	If the notice is not complied with, the shares that it relates to can beforfeitedat any time while any amount (including interest and expenses) is still outstanding. This is done by the Directors passing a resolution stating that the shares have beenforfeited. The Directors can accept the surrender of any share that would otherwise beforfeited.

13 May 2005

28	Forfeiture will include unpaid dividends
	All dividends which are due on (and other amounts payable in respect of) theforfeitedshares, but not yet paid, will also beforfeited.
29	Dealing with forfeited shares
29.1	A shareforfeitedor surrendered under Article 27 belongs to theCompany.The Directors can sell, dispose of or re-allot anyforfeitedshare on any terms, and in any way that they decide. This can be with, or without, a credit for any amount previously paid up for the share. It can be sold or disposed of to any person, including the previous shareholder, or the person who was previously automatically entitled by law to the share. The Directors can, if necessary, authorise any person to transfer a forfeited share.
29.2	The newshareholder’sownership of the share will not be affected if the steps taken toforfeitthe share, or the sale or disposal of the share, were invalid or irregular, or if anything that should have been done was not done, and the newshareholderis not obliged to enquire as to how the purchase money (if any) is used.
30	Cancelling forfeiture
30.1	After a share has beenforfeited, the Directors can cancel theforfeiture. But they can only do this before the share has been sold, re-allotted or disposed of. This can be on any terms that they decide.
30.2	If a share has not been sold, re-allotted or disposed of after threeyearsfrom the date offorfeiture, the Directors must cancel the share.
31	The position of shareholders after forfeiture
31.1	Ashareholderloses all rights in connection withforfeitedshares. If the shares are incertificated form, he must surrender any certificate for those shares to theCompanyfor cancellation. Ashareholderis still liable to paycallswhich had been made, but not paid, before theforfeitureof his shares. He must also pay interest on the unpaid amount at the rate which was payable before theforfeiture, until it is paid. The Directors can fix the rate of interest, but it must not be more than 15 per cent ayear.
31.2	Theshareholdercontinues to be liable for all claims and demands which theCompanycould have made relating to theforfeitedshare. He is not entitled to any credit for the value of the share when it wasforfeitedor for money received by theCompanyunder Article 29, unless the Directors decide to allow credit for all or any of that value. The Directors may also decide to waive any payment due either completely or in part.
32	The Company’s lien on shares
	TheCompanyhas alienon allpartly paid shares. Thislienhas priority over claims of others to the shares and extends to all dividends and other money payable on the shares or in respect of them. Thislienis for any money owed to theCompanyfor the shares. The Directors can decide to give up anylienwhich has arisen or that any share for a specified period of time be entirely or partly exempt from this Article. They can also decide to suspend anylienwhich would otherwise apply to particular shares.

14 May 2005

33	Enforcing the lien by selling the shares
	If the Directors want to enforce thelienreferred to in Article 32, they can sell some or all of the shares in any way they decide. The Directors can authorise anypersonto transfer the shares sold. But they cannot sell the shares until all of these conditions are met:
	•	the money owed by theshareholdermust be immediately payable;
	•	the Directors must have given a written notice to theshareholder.This notice must say how much is due. It must also demand that this money is paid, and say that theshareholder’sshares will be sold if the money is not paid;
	•	the notice just referred to must have been served on theshareholder, or on anypersonwho isautomatically entitled to the shares by law. This notice can be served in any way that the Directors decide; and
	•	the money has not been paid by at least 14clear daysafter the notice has been served.
34	Using the proceeds of the sale
	If the Directors sell any shares under Article 33, the net proceeds will first be used to pay off the amount which is then payable to theCompany. The Directors will pay any money left over to the formershareholder, or to anypersonwho would otherwise beautomatically entitled to the shares by law. But theCompany’slienwill also apply to any money left over, to cover any money still due to theCompanywhich is not yet payable: theCompanyhas the same rights over this money as it had over the shares immediately before they were sold. If the shares are incertificated form, theCompanyneed not pay over anything left under this Article 34 until the certificate representing the shares sold has been delivered to theCompanyfor cancellation.
35	Evidence of forfeiture or sale
	A Director, or theCompany Secretary, can make astatutory declarationwhich declares:
	•	that he is a Director or theCompany Secretaryof theCompany;
	•	that a share has been properly surrendered,forfeitedor sold to satisfy alienunder the
		Articles; and
	•	when the share was surrendered,forfeitedor sold.
	This will be evidence of these facts which cannot be disputed. If this declaration is delivered to the new holder of a share, with any completed transfer form which is required, this gives the buyergood titleto the share. Nor does the new holder of the share need to take any steps to see how any money he may be paying for the share is used. The newshareholder'sownership of the share will not be affected if the steps taken to surrender orforfeitthe share, or the sale or disposal of the share, were invalid or irregular, or if anything that should have been done was not done.

15 May 2005

CHANGING SHARE RIGHTS

36	Changing the special rights of shares
36.1	If theCompany’sshare capital is split into different classes of share, and if thelegislationallows this and unless theArticlesor rights attached to any class of share say otherwise, thespecial rightswhich are attached to any of these classes can be varied orabrogatedin such manner as may be provided by those rights or if this is approved by anextraordinary resolution. This must be passed at a separate meeting of the holders of the relevant class of shares. This is called aclass meeting. Alternatively, the holders of at least three-quarters of theexisting sharesof the class (bynominal value) can give their consent in writing.
36.2	Thespecial rightsof a class of shares can be varied orabrogatedwhile theCompanyis a going concern, or while theCompanyis beingwound up, or if this is being considered.
36.3	This Article 36 also applies to the variation orabrogationofspecial rightsof shares forming part of a class. Each part of the class which is being treated differently is viewed as a separate class in operating this Article 36.
37	Class meetings
	All theArticlesrelating toGeneral Meetingsapply, with any necessary changes, to aclass meeting, but with the following adjustments:
	•	At least two people who hold (or who act asproxiesfor) at least one third of the totalnominal valueof theexisting sharesof the class are aquorum. However, if thisquorumis not present at anadjournedmeeting, onepersonwho holds shares of the class, or hisproxy,is aquorum.
	•	Any holder of shares of that class who is personally present, or who is represented by aproxy, can demand apoll.
	•	On apoll,the holders of shares will have one vote for every share of the class which they hold.
	This issubject toanyspecial rightsor restrictions which are attached to any class of shares by theArticles, or when rights are attached to shares in some other way under theArticles.
38	More about the special rights of shares
	Thespecial rightsofexisting sharesare not regarded as varied orabrogatedif:
	•	new shares are created, orissued, whichrankequally with or subsequent to any otherexisting sharesin sharing in profits orassetsof theCompany(Equal Ranking Shares); or
	•	theCompanyredeemsor buys back its own shares.
	But this does not apply if the terms of theexisting sharesexpressly say otherwise.

16 May 2005

TRANSFERRING SHARES

39	Transfer forms
39.1	Unless theArticlesor terms ofissueof any shares say otherwise, anyshareholdercan transfer some or all of his shares to anotherperson. Every transfer of shares incertificated formmust be in writing, and either in the usual standard form, or in any other form approved by the Directors.
39.2	Transfers of uncertificated shares are to be carried out using arelevant systemand must comply with theCREST Regulations.
40	More about transfers of shares in certificated form
40.1	The transfer form for shares incertificated formmust be delivered to the office where theRegisteris kept (or any other place the Directors may decide). The transfer form must have with it:
	•	the share certificate for the shares to be transferred; and
	•	any other evidence which the Directors ask for to prove that thepersonwishing to make the transfer is entitled to do this.
40.2	However, if a transfer is by arecognised clearing houseor its nominee or by arecognised investment exchange, a share certificate is only needed if a certificate has been issued for the shares in question.
40.3	A share transfer form must be signed, ormade effectivein some other way, by thepersonmaking the transfer.
40.4	A share transfer form must also be signed, ormade effectivein some other way, by thepersonto whom the share is being transferred, if the share is not afullypaid-up share.
40.5	Thepersonmaking a transfer will be treated as continuing to be theshareholderuntil the name of thepersonto whom a share is being transferred is put on theRegisterfor that share.
40.6	If theCompanyregisters a transfer or where the Directors have any grounds for suspecting fraud, it may keep the transfer form. Otherwise, if the Directors refuse to register a transfer the transferinstrumentwill be returned, when notice of refusal is given, to thepersonlodging it.
40.7	A transfer form cannot be used to transfer more than one class of shares. Each class needs a separate form.
40.8	No fee is payable to theCompanyfor transferring shares or registering changes relating to the ownership of shares.
40.9	Transfers may not be in favour of more than four joint holders.
40.10	A transfer form must be properly stamped (for payment of stamp duty) where this is required.
41	The Company can refuse to register certain transfers
41.1	The Directors can refuse to register a transfer of any shares incertificated formwhich are notfullypaid-up. They do not have to give any reasons for refusing. But, if any of those shares are listed on theLondon Stock Exchange, the Directors cannot refuse to register a transfer if this would stop dealings in the shares from taking place on an open and proper basis.

17 May 2005

41.2	If the Directors decide not to register a transfer of a share, they must notify thepersonto whom the shares were to be transferred. This must be done no later than twomonthsafter theCompanyreceives the transfer (in the case of a share incertificated form) or the instruction from theOperatorof therelevant system(in the case of a share inuncertificated form).
42	Closing the Register
	The Directors can decide to suspend the registration of transfers by closing theRegister. This can be for part of a day, a day, or more than a day. Suspension periods can vary between different classes of shares. But theRegistercannot be closed for more than 30 days ayear. In the case of shares inuncertificated form, theRegistermust not be closed without the consent of theOperatorof arelevant system.
43	Overseas branch registers
	TheCompanycan use all the powers that thelegislationgives to keep an overseas branch register. The Directors can make and change any regulations they decide on relating to this register, as long as thelegislationallows this.

PERSONS AUTOMATICALLY ENTITLED TO SHARES BY LAW

44	When a shareholder dies
44.1	When a soleshareholderdies (or ashareholderwho is the last survivor of jointshareholdersdies), his legalpersonal representativeswill be the only people who theCompanywill recognise as being entitled to his shares.
44.2	If ashareholderwho is a jointshareholderdies, the remaining jointshareholderorshareholderswill be the only people who theCompanywill recognise as being entitled to his shares.
44.3	But this Article does not discharge the estate of anyshareholderfrom anyliability.
45	Registering personal representatives and so on
	Apersonwho becomesautomatically entitled to a share by lawcan either be registered as theshareholder, or can select some otherpersonto have the share transferred to. Thepersonwho isautomatically entitled by lawmust provide any evidence of his entitlement which is reasonably required by the Directors.
46	A person who wants to be registered must give notice
	If apersonwho isautomatically entitled to shares by lawwants to be registered as ashareholder, he must deliver or send a notice to theCompanysaying that he has made this decision. He must sign this notice, and it must be in the form, and accompanied by any other documents, which the Directors require. This notice will be treated as a transfer form. All of the provisions of theseArticlesabout registering transfers of shares apply to it except that the shares will only be treated as being presented for registration under Article 17.10 when theCompanyreceives the notice in the form, and accompanied by any other documents, required by the Directors. The Directors have the same power to refuse to register the automatically entitledpersonas they would have had in deciding whether to register a transfer by thepersonwho was previously entitled to the shares.

18 May 2005

47	A person who wants to have another person registered must use a transfer form
	If apersonwho isautomatically entitled to a share by lawwants the share to be transferred to anotherperson, he must do the following:
	•	for a share incertificated formsign a transfer form to thepersonhe has selected; and
	•	for a share inuncertificated formtransfer such share using arelevant system.
	The Directors have the same power to refuse to register thepersonselected as they would have had in deciding whether to register a transfer by thepersonwho was previously entitled to the shares.
48	The rights of people automatically entitled to shares by law
48.1	Apersonwho isautomatically entitled to a share by lawis entitled to any dividends or other money relating to the share, even though he is not registered as the holder of that share. But the Directors can withhold the dividend and other money until apersonhas been properly registered as theshareholderas laid down in theArticles. They can also withhold the dividend if thepersonwho was previously entitled to the share could have had his dividend withheld.
48.2	Unless and until he is registered as the holder of the share thepersonautomatically entitled to a share by lawis not entitled:
	•	to receive notices of meetings;
	•	to attend or vote at meetings; or
	•	(subject toArticle 48.1) to receive any of the other rights and benefits of being ashareholder.

SHAREHOLDERS WHO CANNOT BE TRACED

49	Shareholders who cannot be traced
49.1	If:
	•	during a 12yearperiod, at least three dividends have been payable in respect of any shares and none has been claimed; and
	•	after this 12-yearperiod, theCompanyannounces that it intends to sell the relevant shares by placing an advertisement in a national newspaper and in a newspaper appearing in the area which includes the address held by theCompanyfor serving notices relating to the relevant shares; and
	•	during this 12-yearperiod, and for threemonthsafter the last advertisement appears, theCompanyhas not heard from theshareholderor anypersonwho isautomatically entitled to the relevant shares by law.
		then theCompanycan sell the relevant shares at the best price reasonably obtainable.
49.2	To sell any shares in this way, theCompanycan appoint anypersonto transfer the shares. This transfer will be just as effective as if it had been signed ormade effectivein some other way by the registered holder of the shares, or by apersonwho isautomatically entitled to the

19 May 2005

	shares by law. The ownership of thepersonto whom the shares are transferred will not be affected even if the sale is irregular or invalid in any way. Nor does the new holder of the shares need to take any steps to see how any money he may be paying for the shares is used.
49.3	The net sale proceeds belong to theCompanyuntil claimed under this Article 49, but it must pay these to theshareholderwho could not be traced, or to thepersonwho isautomatically entitled to his shares by law, if thatshareholder, or that otherperson, asks for it.
49.4	TheCompanymust record the name of thatshareholder, or thepersonwho wasautomatically entitled to the shares by law, as a creditor for the net sale proceeds in its accounts. The net sale proceeds are not held ontrust, and no interest is payable on the net sale proceeds. TheCompanycan keep any money which it has earned on the net sale proceeds. TheCompanycan use the net sale proceeds for its business, or it can invest the net sale proceeds in any way that the Directors decide, other than in theCompany’sshares, or in the shares of anyholding companyof theCompany.
49.5	In the case ofuncertificated shares, this Article issubject toany restrictions which apply under theCREST Regulations.

GENERAL MEETINGS

50	The Annual General Meeting
	Except as provided in thelegislation, eachyeartheCompanymust hold an AnnualGeneral Meeting, in addition to any otherGeneral Meetingswhich are held in theyear. The notice calling the meeting must say that the meeting is the AnnualGeneral Meeting. There must not be a gap of more than 15monthsbetween one AnnualGeneral Meetingand the next. The Directors will decide when and where to hold the AnnualGeneral Meeting.
51	Extraordinary General Meetings
	If aGeneral Meetingis not an AnnualGeneral Meeting, it is called an ExtraordinaryGeneral Meeting.
52	Calling an Extraordinary General Meeting
52.1	The Directors can decide to call an ExtraordinaryGeneral Meetingat any time. Extraordinary Meetings must be called promptly in response to arequisitionbyshareholdersunder thelegislation. If an ExtraordinaryGeneral Meetingis not called in response to such a request byshareholders, it can be called by theshareholderswho requested the ExtraordinaryGeneral Meetingin accordance with thelegislation. Any ExtraordinaryGeneral Meeting requisitionedin this way byshareholdersshall be called in the same manner as nearly as possible to that in whichGeneral Meetingsare called by the Directors. The Directors must decide when and where to hold an ExtraordinaryGeneral Meeting.
52.2	If there are insufficient Directors within theUnited Kingdomto call aGeneral Meeting requisitionedbyshareholdersany Director may call aGeneral Meeting. If there are no Directors within theUnited Kingdomanymemberof theCompanymay call such aGeneral Meeting.

20 May 2005

53	Notice of General Meetings
53.1	At least 21clear days’notice in writing (or, where thelegislationpermits, byelectronic mail) must be given for every AnnualGeneral Meetingand for any other meeting where it is proposed to pass aspecial resolutionor to pass some other resolution of whichspecial noticeunder theCompanies Acthas been given to theCompany. For every otherGeneral Meetingat least 14clear days’notice in writing (or, where thelegislationpermits, byelectronic mail) must be given.
53.2	Any notice ofGeneral Meetingmust:
	•	say where the meeting is to be held;
	•	give the date and time of the meeting;
	•	give the general nature of the business of the meeting;
	•	say if any resolution will be proposed as aspecial resolutionorextraordinary resolution;
	•	say that ashareholderwho can attend and vote can appoint one or moreproxies(who need not beshareholders) to vote for him on apoll; and
	•	state whether the meeting is an Annual or ExtraordinaryGeneral Meeting.
53.3	Notices of meetings must be given to theshareholders, except in cases where theArticlesor the rights attached to shares state that the holders are not entitled to receive them from theCompany. Notice must also be given to theCompany’sauditors.
53.4	TheCompanycan decide that onlypeoplewho are entered on theRegisterat the close of business on a particular day are entitled to receive such a notice. That day shall be a day chosen by theCompanyand falling not more than 21 days before the notice is sent.
53.5	If theCompanycannot effectively call aGeneral Meetingby sending notices through the post, because the postal service is suspended or restricted in theUnited Kingdom, the Directors can call the meeting by publishing a notice in at least twoUnited Kingdomnational newspapers. Notice published in this way will be treated as being properly served onshareholderswho are entitled to receive it on the day when the advertisement appears. If it becomes possible to use the postal service again more than 14 days before the meeting, theCompanymust send confirmation of the notice through the post.
53.6	Unless thelegislationdoes not require it, theCompanymust, on therequisitionin writing of such number ofshareholdersas is specified in theCompanies Act, send toshareholders:
	•	entitled to receive notice of the next AnnualGeneral Meetingnotice of any resolution which may properly be proposed and is intended to be proposed at that meeting; and
	•	entitled to receive notice of anyGeneral Meetingany statement of not more than one thousand words with respect to the matter referred to in any proposed resolution or the business to be dealt with at that meeting.
	Notice of any resolution shall be given, and any such statement shall be circulated, toshareholdersof theCompanyentitled to receive notice of theGeneral Meetingsent to them. The cost of this, unless theCompanydecides otherwise, or thelegislationotherwise requires, must be borne by therequisitionists.

21 May 2005

54

A General Meeting can be moved at short notice

If the Directors consider that it is impractical, or unreasonable, to hold aGeneral Meetingat the place stated in the notice calling the meeting, they can move or postpone the meeting, or do both of these things. If the Directors do this, an announcement of the date, time and place of the rearranged meeting will, if practical, be published in at least twoUnited Kingdomnational newspapers. Notice of the business of the meeting does not need to be given again. The Directors must take reasonable steps to ensure that anyshareholdertrying to attend the meeting at the original time and place is informed of the new arrangements. If a meeting is rearranged in this way,proxy formscan be delivered, in the way required by Article 75, until 48 hours before the rearranged meeting. The Directors can also move or postpone the rearranged meeting, or both, under this Article 54.

PROCEEDINGS AT GENERAL MEETINGS

55	The chairman of a General Meeting
55.1	The Chairman of the Directors will be the chairman at everyGeneral Meetingif he is willing and able to take the chair.
55.2	If theCompanydoes not have a Chairman, or if the Chairman is not willing and able to chair the meeting, a Deputy Chairman will chair the meeting if he is willing and able to take the chair.
55.3	If theCompanydoes not have a Chairman or a Deputy Chairman, or if neither the Chairman or any Deputy Chairman are willing and able to chair the meeting, after waiting 15 minutes from the time that a meeting is due to start, the Directors who are present will choose one of themselves to act as chairman. If there is only one Director present, he will be chairman, if he agrees.
55.4	If there is no Director willing and able to be chairman, or if no Director is present within 15 minutes of the time fixed for the meeting, then theshareholderswho are personally present at the meeting and entitled to vote will decide which one of them is to be chairman.
55.5	To avoid any doubt, nothing in theArticlesrestricts or excludes any of the powers, or rights of a chairman of a meeting which are given by the general law.
56	Security and other arrangements at General Meetings
	Either the chairman of a meeting, or theCompany Secretary, can take any action he considers appropriate (either before or during theGeneral Meetingin question) for:
	•	the safety of people attending aGeneral Meeting;
	•	proper and orderly conduct at aGeneral Meeting; or
	•	the meeting to reflect the wishes of the majority.
57	Overflow meeting rooms
	The Directors can arrange for any people who they consider cannot be seated in the main meeting room, where the chairman will be, to attend and take part in aGeneral Meetingin an overflow room or rooms. Any overflow room will have appropriate links with the main room as required by the general law. The notice of the meeting does not have to give details of any arrangements under this Article 57. The Directors can decide on how to divide people between

22 May 2005

	the main room and any overflow room. If any overflow room is used, the meeting will be treated as being held, and taking place, in the main room.
58	The quorum needed for meetings
	Before aGeneral Meetingstarts to do business, there must be aquorumpresent. If there is not, the meeting cannot carry out any business. Unless theArticlessay otherwise, aquorumfor all purposes is twopeoplewho are entitled to vote. They can be personally present orproxiesforshareholdersorcompany representativesor a combination ofshareholderspersonally present,proxiesandcompany representatives.
59	The procedure if there is no quorum
59.1	This Article 59 applies if aquorumis not present within 30 minutes of the time fixed for aGeneral Meetingto start or within any longer period which the chairman may decide on or if during a meeting aquorumceases to be present.
59.2	If the meeting was called byshareholdersit is dissolved. Any other meeting isadjournedto any day, time and place stated in the notice of meeting. If the notice does not provide for this, the meeting isadjournedto a day, time and place decided on by the chairman.
59.3	If at theadjournedmeeting aquorumis not present within 15 minutes of the time fixed for it, the meeting is dissolved.
60	Adjourning meetings
60.1	The chairman of aGeneral Meetingcanadjournthe meeting, before or after it has started, and whether or not aquorumis present, if he considers that:
	•	there is not enough room for the number ofshareholderswho wish to attend the meeting;
	•	the behaviour of the people present prevents, or is likely to prevent, the business of the meeting being carried out in an orderly way; or
	•	anadjournmentis necessary for any other reason, so that the business of the meeting can be properly carried out.
	The chairman does not need the consent of the meeting toadjournit for any of these reasons to a time, date and place which he proposes. This includes an indefiniteadjournment. Theadjournmentwill be to another time, which may be later on the same day as the meeting, and can be to another place. The chairman will decide on these matters.
60.2	The chairman of aGeneral Meetingcan alsoadjourna meeting which has aquorumpresent, if this is agreed by the meeting. This can be to a time, date and place proposed by the chairman. It includes an indefinite adjournment. The chairman must adjourn the meeting if the meeting directs him to. In these circumstances the meeting will decide how long the adjournment will be, and where it will adjourn to. If a meeting is adjourned indefinitely, the Directors will fix the time, date and place of the adjourned meeting.
60.3	General Meetingscan beadjournedmore than once. However, if a meeting isadjournedfor more than 28 days or indefinitely, at least sevenclear days’notice must be given for theadjournedmeeting in the same way as was required for the original meeting. If a meeting isadjournedfor less than 28 days, there is no need to give notice about theadjournedmeeting,

23 May 2005

	or about the business to be considered there. Sufficient notice is given if it is given by an advertisement published in at least one national daily newspaper published in theUnited Kingdom.
60.4	Anadjourned General Meetingcan only deal with business that could have been dealt with at the original meeting before it wasadjourned.
61	Amending resolutions
	If the Chairman, acting in good faith, rules an amendment to a resolution out of order, any error in that ruling will not affect the validity of a vote on the original resolution.

VOTING PROCEDURES

62	How votes are taken
62.1	At anyGeneral Meetinga resolution put to the vote of the meeting shall be decided on a show of hands unless a poll is (before the resolution is put to the vote on a show of hands, or on the declaration of the result of the show of hands) demanded by:
	•	the chairman of the meeting;
	•	at least fiveshareholdersat the meeting who are entitled to vote (includingproxiesforshareholdersentitled to vote);
	•	one or moreshareholdersat the meeting who are entitled to vote and who have, between them, at least 10 per cent of the total votes of allshareholderswho have the right to vote at the meeting (includingproxiesforshareholdersentitled to vote); or
	•	one or moreshareholderswho have shares which allow them to vote at the meeting (includingproxiesforshareholdersentitled to vote), where the total amount which has been paid up on these shares is at least 10 per cent of the total sum paid up on all shares which give the right to vote at the meeting.
62.2	Aproxy formgives theproxythe authority to demand apoll, or to join others in demanding one. A demand for apollmade by aproxyfor ashareholderis treated in the same way as a demand by theshareholderhimself. Unless his appointment otherwise provides, theproxymay vote or abstain at his discretion on any matter coming before the meeting on whichproxiesare entitled to vote.
62.3	A demand for apollcan be withdrawn if the chairman agrees to this. If apollis demanded, and this demand is then withdrawn, any declaration by the chairman of the result of a vote on that resolution by ashow of hands, which was made before thepollwas demanded, will stand.
63	How a poll is taken
63.1	If apollis demanded in the way allowed by theArticles, the chairman of theGeneral Meetingdecides where, when and how it will be carried out. The result is treated as the decision of the meeting where thepollwas demanded, even if thepollis carried out after the meeting.
63.2	The chairman can:
	•	decide that a ballot or voting papers or tickets will be used;
	•	appoint scrutineers (who need not beshareholders);

24 May 2005

	•	adjournthe meeting to a day, time and place which he decides on for the result of thepollto be declared; or
	•	decide a time and place where the result of thepollwill be declared.
63.3	If apollis called, ashareholdercan vote either personally or by hisproxy. If ashareholdervotes on apoll, he does not have to use all of his votes or cast all his votes in the same way.
64	When there cannot be a poll
	A pollis not allowed on a vote to elect a chairman of aGeneral Meeting, nor is apollallowedon a vote toadjourna meeting, unless the chairman of the meeting demands apoll. Any suchpollis to be taken immediately.
65	A meeting continues after a poll is demanded
	Ademand for apollon a particular matter does not stop a meeting from continuing and dealingwith other matters.
66	Timing of a poll
	Subject toArticle 64, anypollcan either be taken immediately at the meeting or within 30 days and at a place decided on by the chairman. No notice is required for apollwhich is not taken immediately if the time and place at which it is to be taken are announced at theGeneral Meetingat which it is demanded. If the time and place at which thepollis to be taken is not announced at the meeting at which it is demanded sevenclear days’notice must be given of the time and place at which thepollis to be taken.
67	The chairman’s casting vote
	If the votes are equal, either on ashow of handsor apoll, the chairman of theGeneral Meetingis entitled to a further, casting vote. This is in addition to any other votes which he may have as ashareholder, or as aproxy.
68	The effect of a declaration by the chairman
	The following applies when there is a vote by ashow of hands, and nopollis demanded, or any demand for apollis withdrawn. Any declaration by the chairman on a point of order is conclusive. In addition, a corresponding entry in the minute book is conclusive proof of the following declarations by the chairman of theGeneral Meeting:
	•	a resolution has been carried;
	•	a resolution has been carried unanimously;
	•	a resolution has been carried by a particular majority;
	•	a resolution has not been carried by a particular majority;
	•	a resolution has been lost; or
	•	a resolution has been lost by a particular majority.
	There is no need to prove the validity, number, or proportion of votes recorded for or against a resolution.

25 May 2005

VOTING RIGHTS

69	The votes of shareholders
69.1	When ashareholderis entitled to attend aGeneral Meetingand vote, he has only one vote on ashow of hands. Aproxycannot vote on ashow of hands. Where there is apoll, ashareholderwho is entitled to be present and to vote has one vote for every share which he holds. This issubject toanyspecial rightsor restrictions which are given to any class of shares by, or in accordance with, theArticles.
69.2	To decide who can attend or vote at aGeneral Meetingand how many votes can be cast, the notice of the meeting can give a time by which people must be entered on theRegisterin order to be entitled to attend or vote at the meeting. This time must not be more than 48 hours before the time fixed for the meeting.
70	Shareholders who owe money to the Company
	Unless theArticlessay otherwise, the only people who can attend or vote atGeneral Meetings orexerciseany other right conferred by being ashareholderin relation toGeneral Meetings, areshareholderswho have paid theCompanyallcalls, and all other sums, relating to their shares which are due at the time of the meeting. This applies both to attending a meeting personally and to attending byproxyorcompany representative.
71	Suspension of rights on non-disclosure of interest
71.1	This Article 71 applies if anyshareholder, or anypersonappearing to beinterestedin shares held by suchshareholder, has been properly served with a notice under Section 212 of theCompanies Act, requiring information aboutinterestsin shares, and has failed for a period of 14 days from the date of the notice to supply to the Company the information required by that notice. Then (subject to the provisions of this Article 71 and unless the Directors otherwisedecide) the shareholder is not (for so long as the failure continues) entitled to attend or vote either personally or by proxy or by a company representative at a shareholders’ meeting or to exercise any other right in relation to shareholders’ meetings as holder of:
	•	the shares in relation to which the default occurred (calleddefault shares);
	•	any further shares which areissuedin respect ofdefault shares; and
	•	any other shares held by theshareholderholding thedefault shares.
71.2	Anypersonwho acquires sharessubject torestrictions under Article 71.1 issubject tothe same restrictions, unless:
	•	the transfer was anapproved transfer(see Article 71.9); or
	•	the transfer was by ashareholderwho was not himself in default in supplying the information required by the notice under Article 71.1 and a certificate in accordance with Article 71.3 was provided.
71.3	Where thedefault sharesrepresent 0.25 per cent or more of theexisting sharesof a class (excluding anyequity sharesin theCompanyheld astreasury shares) the Directors can in their absolute discretion by a notice (aSection 212 Notice) to theshareholderdirect that:

26 May 2005

	•	any dividend or part of a dividend or other money which would otherwise be payable on the default shares shall be retained by the Company (without any liability to pay interest when such money is finally paid to the shareholder); and/or
	•	theshareholdershall not be entitled to elect to receive shares in place of dividends withheld; and/or
	•	subject toArticle 71.4 no transfer of any of the shares held by theshareholdershall be registered unless:
		•	either the transfer is anapproved transfer(see Article 71.9);
		•	or theshareholderis not himself in default as regards supplying the information required; and (in this case)
			•	the transfer is of part only of his holding; and
			•	when presented for registration, the transfer is accompanied by a certificate by theshareholderin a form satisfactory to the Directors which states that after due and careful enquiry theshareholderis satisfied that none of the shares included in the transfer aredefault shares.
71.4	AnySection 212 Noticecan treat shares of ashareholderincertificatedanduncertificated formas separate shareholdings and either apply only to shares incertificated formor to shares inuncertificated formor apply differently to shares incertificatedanduncertificated form. In the case of shares inuncertificated formthe Directors can only use their discretion to prevent a transfer if this is allowed by theCREST Regulations.
71.5	TheCompanymust send a copy of theSection 212 Noticeto each otherpersonwho appears to beinterestedin the shares covered by the notice, but, if it fails to do so, this does not invalidate such notice.
71.6	ASection 212 Noticehas the effect which it states while the default resulting in the notice continues. It then ceases to apply when the Directors decide (which they must do within one week of theCompanyreceiving the information requested by the notice). TheCompanymust give theshareholderwritten notice of the Directors’ decision.
71.7	ASection 212 Noticealso ceases to apply to any shares which are transferred by ashareholderin a transfer which would be permitted under Article 71.3.
71.8	For the purposes of this Article 71 apersonis treated as appearing to beinterestedin any shares if theshareholderholding such shares has been served with a notice under Section 212 of the Companies Act and:
	•	the shareholder has named such person as being so interested; or
	•	(after taking into account the response of the shareholder to such notice and any other relevant information) the Company knows or has reasonable cause to believe that the person in question is or may be interested in the shares.
71.9	For the purposes of this Article 71 a transfer of shares is anapproved transferif:
	•	it is a transfer of shares to an offeror under an acceptance of atake-over offer(as defined in Section 428 of the Companies Act); or

27 May 2005

	•	the Directors are satisfied that the transfer is made pursuant to a bona fide sale of the whole of thebeneficial ownershipof the shares to a party unconnected with theshareholderor with anypersonappearing to beinterestedin the shares. This includes such a sale made through theLondon Stock Exchangeor any other stock exchange outside theUnited Kingdomon which theCompany’sshares are normally traded. For this purpose any associate (as that term is defined in Section 435 of the Insolvency Act 1986) is included amongst thepersonswho are connected with theshareholderor anypersonappearing to beinterestedin the shares.
71.10	For the purposes of this Article 71 “interested” has the same meaning as in Section 212 of the Companies Act.
71.11	For the purposes of this Article 71 reference to apersonhaving failed to give theCompanythe information required by aSection 212 Notice, or being in default as regards supplying such information, includes:
	•	reference to his having failed or refused to give all or any part of it;
	•	reference to his having given information which he knows to be false in a material way or having recklessly given information which is false in a material way.
71.12	This Article 71 does not restrict in any way the provisions of theCompanies Actwhich apply to failures to comply with notices under Section 212 of theCompanies Act.
72	Votes of shareholders who are of unsound mind
72.1	This Article 72 applies where:
	•	ashareholderis of unsound mind; and
	•	a court which claims jurisdiction to protect people who are unable to manage their own affairs has made an order detaining ashareholderor appointing apersonto manage his property or affairs.
72.2	Thepersonor people appointed to act for theshareholdercan vote for theshareholderandexerciseother rights atGeneral Meetings. This includes appointing aproxy, voting on ashow of hands, and voting on apoll. However, this Article 72 only applies if any evidence which the Directors may require of their authority to do these things is delivered to the office where theRegisteris kept (or at any other place which may be specified in accordance with theseArticles) at least 48 hours before the relevant meeting (oradjournedmeeting).
73	The votes of joint holders
	Where a share is held by jointshareholdersany one jointshareholdercan vote at aGeneral Meeting(either personally or byproxy). If more than one of the jointshareholdersvotes (either personally or byproxy), the only vote which will count is the vote of thepersonwhose name is listed before the other voters on theRegisterfor the share.

PROXIES

74	Completing proxy forms
74.1	Aproxy formcan be in any form which is commonly used, or in any other form which the Directors approve.

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74.2	Aproxy formmust be in writing. Aproxy formgiven by an individual must be signed by theshareholderappointing theproxy, or by an agent who has been properly appointed in writing. If a proxy is appointed by a company, the form should be either sealed with the company’s seal or signed by an officer or an agent who is properly authorised to act on behalf of the company. Unless the contrary is shown, the Directors are entitled to assume that, where a proxy form purports to have been signed by an officer or agent of a company, such officer or agent was duly authorised by such company without requiring any further evidence. Signatures need not be witnessed. This Article 74.2 is subject to Article 75.2.
74.3	All notices conveningGeneral Meetingswhich are sent toshareholdersentitled to vote at theGeneral Meetingmust, at the expense of theCompany, be accompanied by aproxy form. The proxy form must make provision for two-way voting on all resolutions intended to be proposed, other than resolutions which are merely procedural.
74.4	The accidental omission to send out aproxy formto ashareholderentitled to it (or non- receipt by him of theproxy form) will not invalidate any resolution passed or proceedings at theGeneral Meetingto which theproxy formrelates.
74.5	Ashareholdermay appoint more than oneproxyto attend the same meeting. Delivery of theproxy formdoes not prevent ashareholderfrom attending and voting at the meeting or at anyadjournmentof it.
74.6	Aproxyneed not be ashareholder.
75	Delivering proxy forms
75.1	Aproxy formmust be delivered to the place stated in the notice ofGeneral Meeting, or in theproxy form, or, if no place is stated, to the office where theRegisteris kept or, if the Directors decide to acceptproxiesbyelectronic mail, in the way and to theaddressthat they specify. It must be delivered at least:
	•	48 hours before aGeneral Meeting, or anadjournedmeeting; or
	•	48 hours before apollis taken, if thepollis not taken on the same day as theGeneral Meetingoradjournedmeeting.
75.2	To the extent that thelegislationpermits, Directors can decide to acceptproxiesdelivered byelectronic mail,subject toany limitations, restrictions or conditions they decide to apply and Article 74.2 may be disapplied in relation to aproxy formdelivered in this way.
75.3	If aproxy formis signed by an agent, thepower of attorneyor other authority relied on to sign it, or a copy which has been certified, must be delivered with theproxy form, unless thepower of attorneyhas already been registered with theCompany.
75.4	If Articles 75.1 and 75.3 are not complied with, theproxywill not be able to act for thepersonwho appointed him.
75.5	Where two or moreproxy formsare delivered for use by the same shares, the one which has been delivered last (regardless of when it was signed or by what means it was delivered) shall be treated as replacing andrevokingthe others which have been delivered. If theCompanycan not decide which form was delivered last, none of the forms shall be valid.
75.6	Unless theproxy formsays otherwise, it will be valid at anadjourned General Meetingas well as for the originalGeneral Meetingto which it relates.

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75.7	Ashareholdercan attend and vote at aGeneral Meetingon ashow of handsor on apolleven if he has appointed aproxyto attend and vote at that meeting. However, if he votes inpersonon a resolution, then as regards that resolution his appointment of aproxywill not be valid.
76	Cancellation of a proxy’s authority
76.1	Any vote cast in the way aproxy formauthorises, or any demand for apollmade by aproxy, will be valid even though:
	•	thepersonwho appointed theproxyhas died or is of unsound mind;
	•	theproxy formhas beenrevoked; or
	•	the authority of thepersonwho signed theproxy formfor theshareholderhas beenrevokedor varied.
76.2	However, this does not apply if notice of the fact has been received at the office where theRegisteris kept (or at such other place at which theproxywas validly deposited in accordance with Article 75.1, and subject to any conditions attached to the use of a particular address imposed under that Article) at least one hour before:
	•	theGeneral Meetingoradjournedmeeting starts; or
	•	the time fixed to take apollon a later day.
77	(Not in use)
78	Representatives of companies
78.1	Acompanywhich is ashareholdercan authorise anypersonto act as its representative at anyGeneral Meetingwhich it is entitled to attend. Thispersonis called acompany representative. The directors of thatcompanymust pass a resolution to appoint thecompany representative. If the governing body of thatcompanyis not a board of directors, the resolution can be passed by its governing body. Acompany representativecanexerciseall the powers on behalf of thecompanywhich thecompanycouldexerciseif it were an individualshareholderpresent at the meeting inperson. This includes the power to vote on ashow of handswhen thecompany representativeis personally present at a meeting. Acompany representativemay be counted ina quorum.
78.2	The Directors can require evidence of the authority of acompany representative.
78.3	Any vote cast by acompany representative, and any demand by him for apoll, is valid even though he is, for any reason, no longer authorised to represent thecompany. However, this does not apply if written notice of the fact that he is no longer authorised has been received at the office where theRegister(or at such other place specified by the Directors) is kept before the deadline which applies to notice of cancellation ofproxiesunder Article 76.
78.4	Without limiting the foregoing, in relation toexisting shares (of any kind)in uncertificated form, the Directors may permit aproxyto be appointed by means of anelectronic communicationin the form of anUncertificated Proxy Instruction, and may permit any supplement to, or amendment or revocation of, any suchUncertificated Proxy Instructionto be made by a furtherUncertificated Proxy Instruction. The Directors may in addition prescribe the method of determining the time at which any such instruction or notification is to

30 May 2005

	be treated as received by the Company. The Directors may treat any such instruction or notification purporting or expressed to be sent on behalf of a Shareholder as sufficient evidence of the authority of the person sending the instruction to send it on behalf of that holder.
79	Challenging votes
	Any objection to the right of any person to vote must be made at the General Meeting (or adjourned meeting) at which the vote is cast. This is also true of any objection about the counting of any vote or the failure to count any vote. If a vote is not disallowed at a meeting, it is valid for all purposes. Any objection must be raised with the chairman of the meeting. His decision is final.

DIRECTORS

80	The number of Directors
	There must be at least four Directors (other than alternate directors). But the shareholders can vary this minimum by passing an ordinary resolution. There is no maximum number of Directors.
81	Qualification to be a Director
	A Director need not be a shareholder. A Director who is not a shareholder can still attend and speak at shareholders’ meetings.
82	Directors’ fees
82.1	Each of the Directors may be paid a fee for his services. The Directors can decide on the amount, timing and manner of payment of Directors’ fees, but the total of the fees paid to all of the Directors (excluding amounts paid as special pay under Article 83, amounts paid as expenses under Article 84 and any payments under Article 85) must not exceed:
	•	£300,000 a year5; or
	•	any higher sum decided on by an ordinary resolution at a General Meeting.
82.2	Unless an ordinary resolution is passed saying otherwise, the fees will be divided between some or all of the Directors in the way that they decide. If they fail to decide, the fees will be shared equally by the Directors, except that any Director holding office as a Director for only part of the period covered by the fees is only entitled to a pro rata share.
83	Special pay
83.1	The Directors can award special pay to any Director who:
	•	acts in an executive capacity;

⁵ By a special resolution passed on 21 April 2002 the amount authorised under Article 82.1 was raised from £300,000 to £500,000 a year and by a special resolution passed on 4 May 2005 the amount authorised under Article 82.1 was raised from £500,000 to £1,000,000.

31 May 2005

	•	acts as Chairman or Deputy Chairman (whether or not this office is executive or non- executive);
	•	serves on or acts as chairman to anycommitteeof the Directors; or
	•	performs any other services which the Directors consider to extend beyond the ordinary duties of a Director.
83.2	Specialpaycan take the form of salary, commission or other benefits or can be paid in some other way (for example by issuing shares to the Director). This is decided on by the Directors and may be a fixed sum or percentage of profits or otherwise.
83.3	Specialpayis additional to fees paid under Article 82.1.
84	Directors’ expenses
	TheCompanycan also repay to a Director all reasonable expenses incurred:
	•	to attendshareholders’ meetings;
	•	to attend Directors’ meetings;
	•	to attend meetings ofcommitteesof the Directors; or
	•	in other ways in connection with theCompany’sbusiness.
85	Directors’ pensions and other benefits
85.1	It is entirely for the Directors to decide whether to award:
	•	pensions;
	•	annual payments;
	•	gratuities; or
	•	other allowances or benefits
	to any people who are or were Directors of theCompanyor of anysubsidiaryof theCompanyor of any predecessor in business of theCompanyor to any member of his family (including a spouse, or former spouse) or to anypersonwho is or was dependent on him.
85.2	The Directors can decide to contribute (before as well as after the relevant person ceases to receive a salary or occupy a position for which he receives any form of remuneration) to any scheme or fund or to pay premiums to a third party for the purposes referred to in Article 85.1.
85.3	No Director or former Director is accountable to theCompanyor itsshareholdersfor a benefit of any kind given in accordance with this Article 85. The receipt of a benefit of any kind given in accordance with this Article 85 does not prevent apersonfrom being or becoming a Director.
86	Appointing Directors to various posts
86.1	The Directors can appoint any Director as Chairman, Deputy Chairman or Chief Executive, or to any other executive office they decide on. So far as thelegislationallows, they can decide on the length of these appointments, and on their terms.Subject tothe terms of any contract with theCompany, they can also vary or end such appointments.

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86.2	A Director will automatically stop being Chairman, Deputy Chairman or Chief Executive or the holder of any other executive office to which he was appointed under Article 86.1 if he is no longer a Director. If a Director’s appointment ends by virtue of this Article 86.2, this does not prejudice any claim for breach of contract against theCompanyw hich may otherwise apply.
86.3	The Directors can give a Director appointed to an executive post any of the powers which they jointly have as Directors. These powers can be given on terms and conditions decided on by the Directors either in parallel with, or in place of, the powers of the Directors acting jointly. The Directors can change the basis on which such powers are given or withdraw such powers .

CHANGING DIRECTORS

87	Age limits
	Provisions of thelegislationwhich would restrict the appointment of a Director or require him to stop being a Director because he has reached a particular age do not apply to theCompany. This includes restrictions and requirements involving special formalities once an age limit is reached.
88	Retiring Directors
	At each AnnualGeneral Meetingany Director who was elected or last re-elected a Director at or before the AnnualGeneral Meetingheld in the third calendar year before the currentyearshall automatically retire from office.
89	Eligibility for re-election
	Aretiring Director is eligible for re-election.
90	Re-electing a Director who is retiring
90.1	At theGeneral Meetingat which a Director retires he may be re-elected (as long as the Director has not told theCompanyin writing that he does not wish to be re-elected) if theshareholderspass anordinary resolutionto re-elect the Director.
90.2	A Director retiring at aGeneral Meetingretires at the end of that meeting or (if earlier) when a resolution is passed to appoint someone in his place. Where a retiring Director is re-elected he continues as a Director without a break.
91	Election of two or more Directors
	Asingle resolution for the election of two or more Directors is void unless the putting of the resolution in this form has been approved by an earlier procedural vote taken at the General Meeting, with no votes cast against.
92	People who can be Directors
92.1	Only the followingpeoplecan be elected as Directors at aGeneral Meeting:
	•	A Director who is retiring at the meeting.
	•	Apersonwho is recommended by the Directors.

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	•	Apersonwho has been proposed by ashareholderwho is entitled to attend and vote at theGeneral Meeting.
92.2	Ashareholderproposing a Director in accordance with Article 92.1 must deliver to theRegistered Officeat least seven days before theGeneral Meeting, but not more than 42 days before the meeting (this period includes the date on which the notice is given):
	•	a signed letter stating that he intends to propose anotherpersonfor election as Director; and
	•	written confirmation from thepersonto be proposed that he is willing to be elected.
93	The power to fill vacancies and appoint extra Directors
93.1	The Directors can appoint anypersonas an extra director or to fill acasual vacancy. Any Director appointed in this way must retire at the first AnnualGeneral Meetingafter his appointment. At this AnnualGeneral Meetinghe can be elected by theshareholde rsas a Director.
93.2	Subject toArticle 92 at aGeneral Meetingtheshareholderscan also pass anordinary resolutionto fill acasual vacancyor to appoint an extra Director.
93.3	Extra Directors can only be appointed under this Article up to the limit (if any) on the total number of Directors under theArticles(or any variation of the limit approved by theshareholde rsunder theArticles).
94	Removing and appointing Directors by an ordinary resolution
94.1	Theshareholderscan pass anordinary resolutionto remove a Director, even though his time in office has not ended. This applies despite anything else said in theArticles, or in any agreement between theCompanyand any Director.Special noticeof theordinary resolutionmust be given to theCompanyas required by thelegislation. But if a Director is removed in this way, it will not affect any claim which he may have for damages for breach of any contract of service he may have.
94.2	Subject toArticle 92, theshareholderscan pass anordinary resolutionto appoint apersonto replace a Director who has been removed in this way. If no Director is appointed under this Article 94.2, the vacancy can be filled under Article 93.
94.3	Anypersonappointed under Article 94.2 will be treated, for the purposes of determining the time at which he is to retire, as if he had become a Director on the day on which the Director he replaced was last elected.
95	When Directors are disqualified
95.1	Any Director automatically ceases to be a Director in any of the following circumstances:
	•	If a bankruptcy order is made against him.
	•	If he makes any arrangement or composition with his creditors or applies for an interim order under Section 253 of the Insolvency Act 1986 in connection with a voluntary arrangement under the Insolvency Act 1986.
	•	If he becomes of unsound mind.

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	•	If he has missed Directors’ meetings for a continuous period of sixmonths, without permission from the Directors, and the Directors pass a resolution stating that he has ceased to be a Director.
	•	If he is prohibited from being a Director under thelegislation.
	•	If he:
		(i)	gives theCompanya letter of resignation; or
		(ii)	offers to resign and the Directors pass a resolution accepting the offer.
	•	If all the other Directors pass a resolution, or sign a notice, requiring the Director to resign. He will cease to be a Director when the notice is served on him. But if a Director is removed in this way this is an act of theCompanywhich does not affect any claim for damages for breach of any contract of service which he may have.
	•	If he holds any executive office and his appointment as such is terminated or expires and the Directors resolve that his office should be vacated.
95.2	When a Director stops being a Director for any reason, he will also (unless the Directors otherwise determine) automatically cease to be a member of anycommittee. Removal from office will be without prejudice to any claim which he or theCompanymight bring in relation to any contract of service between him and theCompany.

DIRECTORS’ MEETINGS

96	Directors’ meetings
	The Directors can decide when to have meetings and how they shall be conducted, and on thequorum. They can alsoadjourntheir meetings.
97	Who can call Directors’ meetings
	A meeting can be called by any Director. TheCompany Secretarymust also call a meeting if a Director requests a meeting.
98	How Directors’ meetings are called
	Meetings are called by serving a notice on all the Directors who are present in theUnited Kingdom. This notice may be given to a Director personally, by word of mouth, by notice in writing (sent to him at his last known address) or byelectronic mail(sent to him at his last known electronicaddressor fax number). If a Director is outside theUnited Kingdomhe may provide an address inside theUnited Kingdomor an electronicaddressor fax number for service of notice when he is abroad. TheCompanydoes not have to give such a Director any longer period of notice than he is entitled to when he is in theUnited Kingdom. Any Director can waive notice of any meeting, including one which has already taken place.
99	Quorum
99.1	If no otherquorumis fixed, two Directors are aquorum. A meeting at which aquorumis present canexercise all the powers and discretions of the Directors.
99.2	Apersonwho holds office only as analternate directorshall, if his appointor is not present, be counted in thequorum.

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99.3	A Director who ceases to be a Director at a Directors’ meeting can continue to be present and act as a director and be counted in thequorumuntil the end of that meeting if no other Director objects and aquorumwould not otherwise be present.
100	The chairman of Directors’ meetings
	The Directors can elect any Director as Chairman or as one or more Deputy Chairmen for such periods as the Directors decide. If the Chairman is at a meeting, he will chair it. In his absence, the chair will be taken by a Deputy Chairman, if one is present. If more than one Deputy Chairman is present, the most senior Deputy Chairman will take the chair, unless the Directors decide otherwise. If there is no Chairman or Deputy Chairman present, or if neither of them is willing to act as chairman, within five minutes of the time when the meeting is due to start, the Directors who are present can choose which one of them will chair the meeting.
101	Voting at Directors’ meetings
	Matters for decision which arise at a Directors’ meeting will be decided by a majority vote. If votes are equal, the chairman of the meeting has a second, casting vote.
102	Directors can act even if there are vacancies
102.1	The remaining Directors can continue to act even if one or more of them ceases to be a Director. But if the number of Directors falls below the minimum which applies under Article 80 (including any variation of such minimum approved by anordinary resolutionofshareholders), the remaining Director(s) can only:
	•	either appoint further Directors to make up the shortfall; or
	•	convene aGeneral Meeting.
102.2	If no Director or Directors are willing or able to act under this Article 102, any twoshareholderscan call aGeneral Meetingto appoint extra Directors.
103	Directors’ meetings by video conference and telephone
103.1	Any or all of the Directors, or members of acommittee, can take part in a meeting of the Directors or of acommitteeby way of a video conference or conference telephone, or similar equipment, designed to allow everybody to take part in the meeting.
103.2	Taking part in this way will be counted as being present at the meeting. A meeting which takes place by way of video conference, conference telephone or similar equipment will be treated as taking place where most of the participants are present. If there is no largest group, meetings will be treated as taking place where the chairman is present.
103.3	A meeting held in the way described in Article 103.1 will be valid as long as aquorumis present in one single place, or in places connected by way of video conference, telephone conference, or similar equipment.
104	Resolutions in writing
104.1	This Article 104 applies to a written resolution which is signed by all of the Directors who are in theUnited Kingdomand entitled to receive notice of a Directors’ meeting or by all members of acommitteewho are in theUnited Kingdomand entitled to receive notice of a meeting of acommittee. This kind of resolution is just as valid and effective as a resolution passed by

36 May 2005

	those Directors orcommitteemembers at a meeting orcommitteemeeting which is properly called and held.
104.2	The resolution can be passed using several copies of a document, if each document is signed by one or more Directors orcommitteemembers. These copies can be fax copies. A resolution signed by analternate directorneed not also be signed by his appointor. Also, a resolution signed by an appointor of analternate directorneed not also be signed by that alternate in that capacity.
104.3	A written resolution will be valid at the time it is signed by the last Director orcommitteemember.
105	The validity of Directors’ actions
	Everything which is done by any Directors’ meeting, or by acommitteeof the Directors, or by apersonacting as a Director, or as a member of acommittee, will, in favour of anyone dealing with theCompanyin good faith, be valid even though it is discovered later that any Director, orpersonacting as a Director, was not properly appointed. This also applies if it is discovered later that anyone was disqualified from being a Director, or had ceased to be a Director, or was not entitled to vote. In any of these cases, in favour of anyone dealing with theCompanyin good faith, anything done will be as valid as if there was no defect or irregularity of the kind referred to in this Article 105.

DIRECTORS’ INTERESTS

106	Directors’ interests in transactions with the Company
106.1	If thelegislationallows and he has disclosed the nature and extent of his interest to the Directors, a Director can:
	•	have any kind of interest in any existing or proposed contract, transaction or arrangement with or involving theCompany;
	•	have any kind of interest in any existing or proposed contract, transaction or arrangement with or involving anothercompany(including being a director,officeror employee) in which theCompanyhas some interest;
	•	alone (or through some firm or other organisation with which he is associated) do paid professional work for theCompanyor anothercompanyin which theCompanyhas some interest (other than as Auditor).
106.2	A Director does not have to hand over to theCompanyany benefit he receives as a result of anything allowed under Article 106.1, and no contract, transaction or arrangement of the type described above will be liable to be avoided on the grounds of any Director’s interest or benefit.
106.3	If theCompanyholds or owns shares in anothercompany, the Directors canexercisevotes attached to such shares or if any of the Directors are Directors of such othercompany, they may vote as Directors of that othercompanyin such manner as they think fit.
107	When Directors can vote on things which they are interested in
107.1	Unless theArticlessay otherwise,a Director cannot cast a vote on any contract, arrangement or any other kind of proposal in which he has an interest, and which he knows is a material

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	one. For this purpose, interests of apersonwho is connected with a Director under Section 346 of theCompanies Actare added to the interests of the Director himself. Interests purely as a result of an interest in theCompany’sshares,debenturesor othersecuritiesare disregarded. In relation to analternate directoran interest of his appointor shall be treated as an interest of thealternate director. This is in addition to any interest which thealternate directorhas in his own right. A Director may not be included in thequorumof a meeting in relation to any resolution he is not allowed to vote on.
107.2	But, if thelegislationallows this, a Director can vote, and be counted in thequorum, on any resolution about any of the following things, as long as the only material interests he has in it are included in the following list:
	•	a resolution about giving him, or any otherperson, any security, guarantee orindemnityfor any money which he, or that otherperson, has lent at the request of, or for the benefit of theCompanyor any of itssubsidiaries;
	•	a resolution about giving him, or any otherperson, any security, guarantee orindemnityfor anyliabilitywhich he, or that otherperson, has incurred at the request of, or for the benefit of, theCompanyor any of itssubsidiaries;
	•	a resolution about giving any security, guarantee orindemnityto any otherpersonfor a debt or obligation which is owed by theCompany, or any of itssubsidiaries, to that otherperson, if the Director has taken responsibility for some or all of that debt or obligation. The Director can take this responsibility by giving a guarantee,indemnityor security;
	•	a resolution about any proposal relating to an offer of any shares ordebentures,or othersecuritiesfor subscription or purchase by theCompany, or any of itssubsidiaries, if the Director takes part because he is a holder of shares,debenturesor othersecurities, or if he takes part in theunderwritingorsub-underwritingof the offer;
	•	a resolution about any proposal involving any othercompanyif the Director has a direct or indirect interest of any kind in thatcompany(including an interest by holding any position in thatcompany, or by being a shareholder of thatcompanywhich is not a“material interest” as defined below). An interest in shares (as defined for Sections 198 to 211 of the Companies Act) shall be treated for the purposes of this Article 107 as being a material interest if it represents 1 per cent or more of:
		•	any class ofequity sharecapital; or
		•	the voting rights in any suchcompany.
		For these purposes:
		•	shares shall not be counted if they are held by a Director as bare or custodian trustee and he has no beneficial interest in them, or if they are comprised in an authorised unit trust scheme in which the Director is interested only as a unit holder; and
		•	the interests of anypersonconnected with the Director under Section 346 of theCompanies Actare counted as being the Director’s interests.

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	•	any arrangement for the benefit of employees of theCompany, or any of itssubsidiaries, which only gives him benefits which are also generally given to the employees to whom the arrangement relates;
	•	a resolution about any proposal relating to any insurance againstliabilitywhich theCompanycan buy and renew for the benefit of Directors, or of a group of people which includes Directors;
	•	a resolution about a retirement benefits scheme which has been approved, or is conditional on approval, by the Board of Inland Revenue for tax purposes;
	•	the funding of expenditure by one or more Directors on defending proceedings against him or them or doing anything to enable such Director or Directors to avoid incurring such expenditure; or
	•	indemnities in favour of Directors which are consistent with, or no more onerous than, the provisions of these Articles.
107.3	This Article 107.3 applies if the Directors are considering proposals about appointing two or more Directors to positions with theCompanyor anycompanyin which theCompanyis interested. It also applies if the Directors are considering setting or changing the terms of any such appointment. These proposals can be split up to deal with each Director separately. If this is done, each Director can vote and be included in thequorumfor each resolution, except the one concerning him. A Director cannot vote if the resolution relates to appointing him to acompanywhich theCompanyis interested in if the Director has an interest of 1 per cent or more in thatcompanyin the way described in Article 107.2.
107.4	If any question comes up at a meeting about whether a Director has a material interest, or whether he can vote, and the Director does not agree to abstain from voting on the issue, the question shall be referred to the chairman of the meeting or, if the Director concerned is the chairman, to the other directors at the meeting for a ruling. A ruling under this Article 107.4 about any other Director is final and conclusive, unless the kind and extent of the Director’s interests have not been fairly disclosed to the Directors.
108	More about Directors’ interests
	For the purpose of Articles 106 and 107:
	•	a general notice given to the Directors that a Director has an interest of the kind stated in the notice in any contract, transaction or arrangement involving anycompanyorpersonidentified in the notice is treated as a standing disclosure that the Director has such interest;
	•	an interest of apersonwho is connected with the Director under Section 346 of theCompanies Actwill be treated as an interest of the Director;
	•	interests which are unknown to the Director and which it is unreasonable to expect him to know about are ignored.

MINUTES

109	Minutes
	Directors shall ensure that minutes are made in the appropriate books:

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• recording the appointment of Directors and the Company Secretary (but not any Deputy or Assistant Company Secretary);

• recording the proceedings of the meetings of the Company, of holders of any class of shares, of the Directors and of committees of the Directors; and

• recording in each case the names of the Directors present.

DIRECTORS’ COMMITTEES

110	Delegating powers to committees
110.1	The Directors can delegate any of their powers, or discretions, tocommitteeswhich may consist of one or more Directors and one or more other people or wholly of Directors or wholly of other people. This includes powers or discretions relating to Directors’payor giving benefits to Directors. If the Directors have delegated any power or discretion to acommittee, any references in theseArticlesto using that power or discretion include its use by thecommittee. Anycommitteemust comply with any regulations laid down by the Directors. These regulations can require or allow people who are not Directors to be co-opted onto the committee, and can give voting rights to co-opted members.
110.2	Unless the Directors decide not to allow this, acommitteecan sub-delegate powers and discretions to sub-committees or other people. References in theseArticlestocommitteesinclude sub-committees permitted under this Article 110.
111	Committee procedure
	If acommitteeincludes two or moremembers, the Articles which regulate Directors’ meetings and their procedure will also apply tocommitteemeetings (if they can apply tocommitteemeetings), unless these are inconsistent with any regulations for thecommitteewhich have been laid down under Article 110.1.

DIRECTORS’ POWERS

112	The power to appoint attorneys
112.1	The Directors can appoint anyone (including the members of a group which changes over time) as theCompany’sattorneysby granting apower of attorneyor by authorising them in some other way. Theattorneyscan either be appointed directly by the Directors, or the Directors can give someone else the power to appointattorneys. The Directors can decide on the purposes, powers, authorities and discretions ofattorneys. But they cannot give anattorneyany power, authority or discretion which the Directors do not have under these Articles.
112.2	The Directors can decide for how long apower of attorneywill last, and they can attach any conditions to it. Thepower of attorneycan also include any provisions on which the Directors decide for the protection and convenience of anybody dealing with theattorney. Thepower of attorneycan also allow theattorneyto grant any or all of his power, authority or discretion to any otherperson.

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113	Use of the title of “Director”
113.1	The Directors may:
	•	appoint any person to any office or employment which has a designation or title which includes the word “Director”; or
	•	attach to any existing office or employment with the Company such a designation or title;
	and may terminate any such appointment or the use of any such designation or title.
113.2	The inclusion of the word “Director” in the designation or title of any such office or employment shall not imply that the holder is a Director of the Company. The holder of that designation or title is not empowered to act as, or be deemed to be, a Director of the Company for any of the purposes of these Articles.
114	Signature on cheques etc.
	All cheques, promissory notes, drafts, bills of exchange, and other negotiable or transferable instruments, and all receipts for money paid to the Company, can be signed, drawn, accepted, endorsed, or made legally effective, in such manner as the Directors decide by passing a resolution.
115	Borrowing powers
	So far as the Companies Act allows, the Directors can exercise all the powers of the Company to:
	•	borrow money;
	•	issue (subject to the provisions of the Companies Act regarding authority to allot debentures convertible into shares) debentures and other securities; and
	•	give any form of:
		•	guarantee; or
		•	security, either outright or as collateral and over all or any of the Company’s undertaking, property and uncalled capital;
	for any debt, liability or obligation of the Company or of any third party.
116	Borrowing restrictions
116.1	The Directors must:
	•	limit the Borrowings of the Company; and
	•	exercise all voting and other rights or powers of control exercisable by the Company in relation to its subsidiaries,
	ensure that the total amount of all Borrowings by the Group outstanding at any time will not exceed two times the Adjusted Total of Capital and Reserves at such time.
	This limitation on Borrowings will only affect subsidiaries to the extent that the Directors can restrict the borrowings of the subsidiaries by exercising the rights or powers of control which

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	the Company has over its subsidiaries. The Company may consent in advance to exceeding the borrowing limit by passing an ordinary resolution at a General Meeting.
116.2	In this Article:
	Group means the Company and its subsidiaries for the time being;
	Adjusted Total of Capital and Reserves means the aggregate of the share capital and reserves as shown in the latest audited consolidated balance sheet of the Group (including the amount paid up or credited as paid up on the issued share capital of the Company, the share premium account, capital redemption reserve, profit and loss account and other reserves included within the Group’s equity shareholders’ funds) (the “Reserves”) but:
	•	adjusted as appropriate in respect of any variation to the paid up share capital or reserves since the date of the latest audited consolidated balance sheet as recorded within the monthly management accounting records of the Group;
	•	adding any amount which has been deducted at any time from the Reserves of the Group for goodwill arising on consolidation either by direct charge to Reserves or by charge to the Group’s consolidated profit and loss account;
	•	adjusted as appropriate to reflect any difference in value between the fixed assets shown in the latest audited consolidated balance sheet of the Group and the net current replacement cost of those fixed assets; and
	•	making such other adjustments (if any) as the auditors of the Company consider appropriate.
	Borrowings means the aggregate amount of all liabilities and obligations of the Group which in accordance with the accounting bases and principles of the Group are treated as borrowings in the latest audited consolidated balance sheet of the Group but:
	•	adjusted as appropriate in respect of any variation to borrowings since the date of the latest audited consolidated balance sheet as recorded within the monthly management accounting records of the Group;
	•	excluding any borrowings under finance or structured tax lease arrangements to the extent matched as part of those arrangements by deposits of cash or cash equivalent investments which are treated by the creditor concerned as available to reduce its net exposure; and
	•	making such other adjustments (if any) as the auditors of the Company consider appropriate.
116.3	The determination of the Company’s auditors as to the amount of the Adjusted Total of Capital and Reserves and the total amount of Borrowings at any time shall be conclusive and binding on all concerned and for the purposes of their computation the Company’s auditors may at their discretion make such further or other adjustments (if any) or determinations as they think fit. Nevertheless the Directors may act in reliance on a bona fide estimate of the amount of the Adjusted Total of Capital and Reserves and the total amount of Borrowings at any time and if in consequence the borrowing limit is inadvertently exceeded an amount of borrowings equal to the excess may be disregarded until the expiration of three months after the date on which by reason of a determination of the Company’s auditors or otherwise the Directors became aware that such a situation has or may have arisen.

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116.4 No lender or other person dealing with the Group need be concerned whether the borrowing limit is observed. No debt incurred or security given in breach of the borrowing limit will be invalid or ineffective unless the lender or the recipient of the security had express notice at the time when the debt was incurred or security given, that the limit had been or would as a result be breached.

ALTERNATE DIRECTORS

117	Alternate Directors
117.1	Any Director may appoint any person (including another Director) to act in his place (such person is called an alternate director). Such appointment requires the approval of the Directors, unless the proposed alternate director is another Director. A Director appoints an alternate director by delivering a signed appointment (or in any other manner which has been approved by the Directors) to the Company. An alternate director need not be a shareholder.
117.2	The appointment of an alternate director ends if the Director appointing him ceases to be a Director, unless that Director retires at a General Meeting at which he is re-elected under Article 90. A Director can also remove his alternate by delivering a signed notice (or doing something else which has been approved by the Directors) delivered to the Registered Office. An alternate director can also be removed as an alternate by a resolution of the Directors.
117.3	An alternate director is entitled to receive notices of Directors’ meetings once he has given the Company an address, electronic address or fax number to which notices may be served on him. He is entitled to attend and vote as a Director at any such meeting at which the Director appointing him is not personally present and generally at such meeting to perform all functions of the Director appointing him as a Director. If he is himself a Director or attends any such meeting as an alternate for more than one Director, he will have one vote for each Director for whom he acts as an alternate, in addition to his own vote as a Director. However, he may not be counted more than once for the purposes of the quorum. If his appointor is temporarily unable to act through ill health or disability or is out of the United Kingdom, his signature to any resolution in writing of the Directors is as effective as the signature of his appointor.
117.4	If the Directors decide to allow this, this Article 117 also applies in a similar fashion to any meeting of a committee of which his appointor is a member.
117.5	An alternate director shall be an officer of the Company and shall alone be responsible to the Company for his own actions and mistakes. Except as said in this Article 117, an alternate director:
	•	does not have power to act as a Director;
	•	is not considered to be a Director for the purposes of the Articles;
	•	is not considered to be the agent of his appointor; and
	•	cannot appoint an alternate director.
117.6	Subject to the legislation, an alternate director is entitled to contract and be interested in and benefit from contracts or arrangements or transactions and to be repaid expenses and to be

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indemnified to the same extent as if he were a Director. However, he is not entitled to receive from the Company as alternate director any pay, except only such part (if any) of the pay otherwise payable to his appointor as such appointor may direct the Company in writing to pay to his alternate or (unless the Company by ordinary resolution decides otherwise). 

THE COMPANY SECRETARY

118	The Company Secretary and Deputy and Assistant Company Secretaries
118.1	The Company Secretary is appointed by the Directors. The Directors decide on the terms and period of his appointment so long as allowed to do so by the legislation. The Directors may also remove the Company Secretary, but this does not affect any claim for damages against the Company for breach of any contract of employment he may have. The Directors may appoint two or more people to be joint Company Secretaries.
118.2	The Company Secretary can appoint one or more people to be Deputy or Assistant Company Secretary. The Company Secretary may also remove any Deputy or Assistant Company Secretary, but this does not affect any claim for damages against the Company for breach of any contract of service he may have. Anything which the Articles or the legislation require, or allow, to be done by the Company Secretary can also be done by any Deputy or Assistant Company Secretary.
118.3	Anything which the legislation allows to be done by or to a Director and the Company Secretary, cannot be done by or to one person acting as both a Director and a Company Secretary.

THE SEAL

119	The Seal
119.1	The Directors are responsible for arranging for the Seal and any Securities Seal to be kept safely. The Seal and any Securities Seal can only be used with the authority of the Directors (or any one or them). The Securities Seal can be used only for sealing securities issued by the Company in certificated form and sealing documents creating or evidencing securities issued by the Company.
119.2	Subject to the provisions of these Articles which relate to share certificates, every document which is sealed using the Seal must be signed personally by:
	•	two Directors; or
	•	the Company Secretary; or
	•	any other persons who are authorised to do so by the Directors (or any one of them).
119.3	Where a signature is required to witness the Seal, the Directors may decide that the individual need not sign the document personally but that his signature may be printed on it mechanically, electronically or in any other way the Directors approve.
119.4	Securities and documents which have the Securities Seal stamped on them do not need to be signed unless the Directors or the legislation require this.
119.5	The Directors can use all the powers given by the legislation relating to official seals for use abroad.

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119.6

Certificates for debentures or other securities of the Company may be printed in any way and may be sealed and/or signed for in any manner allowed by these Articles.

119.7

As long as it is allowed by the legislation, any document which is signed by one Director and the Company Secretary or by two Directors and expressed to be entered into by the Company shall have the same effect as if it had been made effective by using the Seal. However no document which states that it is intended to have effect as a deed shall be signed in this way without the authority of the Directors or of a committee authorised by the Directors to give such authority.

AUTHENTICATING DOCUMENTS

120	Establishing that documents are genuine
120.1	Any Director, or the Company Secretary, has power to authenticate any of the following things, and to certify copies or extracts from them as true copies or extracts:
	•	any documents relating to the Company’s constitution;
	•	any resolutions passed by the shareholders, or by the Directors or by a committee of the Directors; and
	•	any books, documents, records or accounts which relate to the Company’s business.
120.2	The Directors can also give this power to others. When any books, documents, records and accounts are not kept at the Registered Office, the person who holds them is treated as a person who has been authorised by the Directors to authenticate any of them, and to provide certified copies or extracts from them.
120.3	This Article 120.3 applies to a document which appears to be a copy of a resolution or an extract from the minutes of any meeting, and which is certified as a copy or extract as described in Article 120.1 or 120.2. This document is conclusive evidence for anyone who deals with the Company on the strength of the document that:
	•	the resolution has been properly passed; or
	•	the extract is a true and accurate record of the proceedings of a valid meeting.

RESERVES

121	Setting up reserves
	The Directors can set aside any profits of the Company and hold them in a reserve. The Directors can decide to use these sums for any purpose for which the profits of the Company can lawfully be used. Sums held in a reserve can either be employed in the business of the Company or be invested. The Directors can divide the reserve into separate funds for special purposes and alter the funds into which the reserve is divided. The Directors can also carry forward any profits without holding them in a reserve. The Directors must comply with the restrictions under the legislation which relate to reserve funds.
122	Assets bought as from a past date
	This Article 122 applies if the legislation allows this and the Directors decide to deal with profits, losses, dividends or interest as this Article allows. Where any asset, business or

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property is bought by the Company as from a past date (whether such date be before or after the incorporation of the Company), any of the profits and losses from such date can be added to the Company’s revenue account and treated for all purposes as profits or losses of the Company. Similarly, where shares or securities are purchased with any dividend or interest, any such dividend or interest can be treated as revenue, rather than being treated as a capital item.

DIVIDENDS

123	Final dividends
	The Directors may recommend the amount of any final dividend. Theshareholderscan thendeclaredividends by passing anordinary resolution. No such dividend can exceed the amount recommended by the Directors.
124	Fixed and interim dividends
124.1	If the Directors consider that the profits of theCompanyjustify such payments, they can:
	•	pay the fixed dividends on any class of shares carrying a fixed dividend on the dates prescribed for the payment of such dividends; and
	•	pay interim dividends on shares of any class of such amounts and on such dates and for such periods as they decide. But no interim dividend shall be paid on shares which carry deferred or non-preferred rights if, at the time of payment, any preferentialdividendis inarrear(on any one of them).
124.2	If the Directors act in good faith, they are not liable to the holders of any shares for any loss they may suffer because a lawful dividend has been paid under this Article 124 on other shares whichrankequally with or behind their shares.
125	Dividends not in cash
	If the Directors recommend this, theshareholderscan pass anordinary resolutionto direct all or part of a dividend to be paid by distributing specificassets(and in particularpaid-upshares ordebenturesof any othercompany). The Directors must give effect to such resolution. Where any difficulty arises on the distribution or valuation of theassets, the Directors can settle it as they decide. In particular, they can:
	•	issue fractional certificates (or ignore fractions);
	•	valueassetsfor distribution purposes;
	•	pay cash of a similar value to adjust the rights ofpersonsentitled to the dividend; and/or
	•	transfer anyassetstotrusteesforpersonsentitled to the dividend.
126	Apportioning dividends
	All dividends will be divided and paid in proportions based on the amounts which have been paid up on the shares during any of the period for which the dividend is paid. Sums which have been paid up in advance ofcallsdo not count as paid up for this purpose. But if theterms of any sharesay that it will be entitled to a dividend as if it were afullypaid-up, orpartlypaid-

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	up,sharefrom a particular date (in the past or the future), it will be entitled to a dividend on this basis. This Article 126 applies unless the rights attached to any shares, or theterms of any shares, say otherwise.
127	Deducting amounts owing from dividends and other money
	If ashareholderowes any money forcallson shares, or money relating in any other way to shares, the Directors can deduct any of this money from:
	•	any dividend on any shares held by theshareholder; or
	•	any other money payable by theCompanyin connection with the shares.
	Money deducted in this way can be used to pay amounts owed to theCompanyin connection with the shares.
128	Payments to shareholders
128.1	Any dividend or other money payable in cash (whether in sterling or foreign currency) relating to a share can be paid:
	•	by cheque or warrant or any other similar financialinstrumentmade payable to theshareholderwho is entitled to it and sent direct to his registered address or, in the case of jointshareholders, to theshareholderwho is first named in theRegisterand sent direct to his registered address, or to someone else named in a written instruction from theshareholder(or from all jointshareholders);
	•	in the case of shares inuncertificated form, by the use of arelevant system;
	•	by inter-bank transfer or other electronic means to an account named in a written instruction from thepersonreceiving the payment; and/or
	•	in some other way agreed between theshareholder(or all jointshareholders) and theCompany.
128.2	For jointshareholders, orpersonsjointly andautomatically entitled to shares by law, theCompanycan rely on a receipt for a dividend or other money paid on shares from any one suchperson.
128.3	Cheques and warrants are sent, and payment in any other way is made, at the risk of thepeoplewho are entitled to the money. TheCompanyis treated as having paid a dividend if such a cheque or warrant is cleared or if a payment using arelevant systemor bank transfer or other electronic means is made in accordance with instructions given by theCompany. TheCompanywill not be responsible for a payment which is lost or delayed.
128.4	Unless the rights attached to any shares, or thetermsof any shares, or theArticlessay otherwise, a dividend, or any other money payable in respect of a share, can be paid in whatever currency the Directors decide using an appropriate exchange rate selected by the Directors for any currency conversions which are required.
128.5	No dividend or other sum payable by theCompanyon or in respect of its shares carries a right to interest from theCompanyunless therightsof the shares provide otherwise.
128.6	If thepersonentitled to the dividend is an employee of theCompanyor of one of itssubsidiaries, the cheque may instead be sent to thatpersonthrough the internal post system of theCompanyor thatsubsidiary.

47 May 2005

129	Record dates for payments and other matters
	Any dividend or distribution on any shares can be paid to the holder or holders of the shares shown on theRegisterat the close of business on a particular day stated in the resolution passed for payment of the dividend or providing for the distribution. It will be based on the number of shares registered on that day. This Article 129 applies whether what is being done is the result of a resolution of the Directors or a resolution passed at aGeneral Meeting. The date can be before any relevant resolution was passed. This Article 129 does not affect the rights between past and presentshareholdersto payments or other benefits.
130	Dividends which are not claimed
130.1	If a dividend has not been claimed for oneyearafter the passing of either the resolution passed at aGeneral Meetingdeclaring that dividend, or the resolution of the Directors providing for payment of that dividend (whichever is later), the Directors may invest the dividend or use it in some other way for the benefit of theCompanyuntil the dividend is claimed. If the Directors decide to pay unclaimed dividends into a separate account, theCompanywill not be atrusteeof the money and will not be liable to pay any interest on it. Any dividend which has not been claimed for 12yearsafter the date on which the dividend wasdeclaredor became due for payment (whichever is later) may be forfeited and belong to theCompanyif the directors so decide.
130.2	TheCompanycan stop paying dividends by cheque or other payment order if cheques or other payment orders for two dividends in a row are sent back or not cashed. TheCompanycan start paying dividends in this way again if theshareholderor apersonautomatically entitled to the shares by law:
	•	claims those dividends (before they areforfeitedunder Article 130.1); and
	•	does not tell theCompanyto start paying dividends in some other way.
131	Waiver of dividends
	All or any dividend can be waived by means of a document on which theCompanyacts. The document must be signed by theshareholder(or thepersonautomatically entitled to the shares by law) and delivered to theCompany. The document need not be in the form of a deed.

CAPITALISING RESERVES

132	Capitalising reserves
132.1	Subject toanyspecial rightsattaching to any class of shares, theshareholderscan pass anordinary resolutionto allow the Directors to change into capital any sum:
	•	which is part of any of theCompany’sreserves(includingpremiumsreceived when any shares wereissued,capital redemption reservesor other undistributablereserves); or
	•	which theCompanyis holding as undistributed profits.
132.2	Unless theordinary resolutionstates otherwise the Directors will use the sum which is changed into capital by setting it aside for theOrdinary Shareholdersor othershareholdersso entitled on theRegisterat the close of business on the day the resolution is passed (or

48 May 2005

	another date stated in the resolution or fixed as stated in the resolution). The sum set aside must be used to pay up on theshareholders’behalf any amount which is unpaid on shares held by them or to pay up in full shares of theCompanyandallotsuch shares and distribute them toshareholders(or as they may direct) as bonus shares in proportion to their holdings ofOrdinary Sharesat the time. The shares can beOrdinary Sharesor, if therightsof otherexisting sharesallow this, shares of some other class. The Directors may resolve that any sharesallottedto anyshareholderin respect of his holding ofpartly paidshares shall only entitle thatshareholderto a dividend to the extent that thosepartly paidshares entitle him.
132.3	If any difficulty arises in operating this Article 132, the Directors can resolve it in any way which they decide. For example they can deal with entitlements to fractions of a share by deciding that the benefit of share fractions belongs to theCompanyor that share fractions are ignored or by dealing with fractions in some other way including by cash payment.
132.4	The Directors can appoint anypersonto sign any contract with theCompanyon behalf of those who are entitled to shares under the resolution. Such a contract is binding on all concerned.

SCRIP DIVIDENDS

133	Shareholders can be offered the right to receive extra shares instead of cash dividends
133.1	The Directors are authorised, generally and without conditions, to offer to holders ofOrdinary Sharesthe right to choose to receive extraOrdinary Shares, which are credited asfullypaid up, instead of some or all of their cash dividend. They are authorised to do this for the period which begins on the date on which theseArticlesare adopted (which is shown on the first page of theseArticles) and ends on the date of theAnnual General Meetingof theCompanyoccurring in 2006. Thereafter, theshareholdersmust have passed anordinary resolutionauthorising the Directors to make this offer before the Directors can do this.
133.2	Theordinary resolutioncan apply to a particular dividend or dividends. Or it can apply to some or all of the dividends which may bedeclaredor paid in the period up to and including theAnnual General Meetingwhich is held in the fifthyearafter theordinary resolutionis passed.
133.3	The Directors can offershareholdersthe right to request new shares instead of cash for:
	•	the next dividend; or
	•	all future dividends (if a share alternative is made available), until they tell theCompanythat they no longer wish to receive new shares.
	The Directors can also allowshareholdersto choose between these alternatives.
133.4	Ashareholderis entitled toOrdinary Shareswhose total relevant value is as near as possible to the cash dividend (excluding any tax credit) he would have received. The relevant value of a share is a value calculated in the manner set out in theordinary resolutionor, if theordinary resolutiondoes not set this out, then the relevant value of a share is the average value of theOrdinary Sharesfor the five dealing days starting from, and including, the day when the shares are first quoted “ex dividend”. This average value is worked out from the average middle market quotations for theOrdinary Shareson theLondon Stock Exchange, as published in its Daily Official List. A certificate or report from theCompany’sauditor as to the amount of relevant value will be conclusive evidence of that amount.

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133.5	After the Directors have decided to apply this Article 133 to a dividend, they must notify eligibleshareholdersin writing (or where thelegislationpermits, byelectronic mail) of their right to opt for new shares. This notice should also say how, where and whenshareholdersmust notify theCompanyif they wish to receive new shares. Whereshareholdershave already opted to receive new shares in place of all future dividends, if new shares are available, theCompanyneed not notify them of a right to opt for new shares. Instead, theCompanywill remind them that they have already opted for new shares and tell them how to tell theCompanyif they wish to start receiving cash dividends again.
133.6	The Directors can set a minimum number ofOrdinary Sharesin respect of which the right to choose new shares can beexercised. Noshareholderswill receive a fraction of a share. The Directors can decide how to deal with any fractions left over. TheCompanycan, if the Directors decide, have the benefit of these left over fractions.
133.7	The Directors can exclude or restrict the right to opt for new shares, or make any other arrangements where they decide that this is necessary or convenient to deal with any of the following legal or practical problems:
	•	problems relating to laws of any territory; or
	•	problems relating to the requirements of any recognised regulatory body or stock exchange in any territory; or
	•	where special formalities would otherwise apply in connection with the offer of new shares.
133.8	So far as ashareholderopts to receive new shares, no dividend on the shares for which he has opted to receive new shares (which are called theelected shares), will bedeclaredor payable. Instead, newOrdinary Shareswill beallottedon the basis set out earlier in this Article 133. To do this the Directors will convert into capital the sum equal to the totalnominalamountof the newOrdinary Sharesto beallotted. They will use this sum topay up in fullthe appropriate number of newOrdinary Shares. These will then beallottedand distributed to the holders of theelected sharesas set out above. The sum to be converted into capital can be taken from any amount which is then in anyreserveor fund (including theshare premium account, anycapital redemption reserveand the profit and loss account). Article 132 applies to this process, so far as it is consistent with this Article 133.
133.9	Unless the Directors decide otherwise or theCREST Regulationsor therulesof arelevant systemrequire otherwise, any new shares which anOrdinary Shareholderhas chosen to receive instead of some or all of his cash dividend will be:
	•	shares inuncertificated formif the correspondingelected shareswereuncertificated shareson the record date for that dividend; and
	•	shares incertificated formif the correspondingelected sharesweresharesincertificated formon the record date for that dividend.
133.10	The newOrdinary Sharesrankequally in all respects with the existingfullypaid-upOrdinary Shareson the record date for the dividend. But, they are not entitled to share in the dividend from which they arose and do not allow the holder to opt for new shares instead of that dividend.
133.11	The Directors can decide that new shares will not be available in place of any cash dividend. They can decide this at any time before new shares areallottedin place of such dividend, whether before or aftershareholdershave opted to receive new shares.

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133.12 The Directors have the power to do all acts and things they consider necessary to give effect to this Article.

ACCOUNTS

134	Accounting and other records
	The Directors shall make sure that proper accounting records that comply with thelegislationare kept to record and explain theCompany’stransactions.
135	Location and inspection of records
135.1	The accounting records shall be kept:
	•	at theRegistered Office; or
	•	at any other place which thelegislationallows, and on which the Directors decide.
135.2	The Directors and theCompany Secretary(but not any Deputy or Assistant Company Secretary) always have the right to inspect the accounting records.
135.3	Anyone else (including ashareholder) does not have any right to inspect any books or papers of theCompanyunless:
	•	thelegislationor a proper court order or anordinary resolutionof theCompanygives him that right; or
	•	the Directors authorise him to do so.
136	Sending copies of accounts and other documents
136.1	This Article 136 applies to every balance sheet and profit and loss account to be laid before theshareholdersat aGeneral Meetingwith any other document which thelegislationrequires to be attached to these, including the Directors’ and auditors’ reports.
136.2	Copies of the documents set out in Article 136.1 must be sent to theCompany’s shareholdersanddebentureholdersand all otherpeopleto whom theArticles, or thelegislation, require theCompanyto send them. This must be done at least 21clear daysbefore the relevantGeneral Meeting. But theCompanyneed not send these documents to:
	•	shareholderswho are sent summary financial statements in accordance with thelegislation;
	•	more than one joint holder of shares ordebentures; or
	•	anypersonfor whom theCompanydoes not have a current address.
136.3	Shareholdersordebentureholderswho are not sent copies can receive a copy free of charge by applying to theCompanyat theRegistered Office.
136.4	If permitted by thelegislationand agreed to by theshareholder, the documents set out in this Article may be delivered byelectronic communication.

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AUDITORS

137	Acts of Auditors
	The Directors must appoint auditors for theCompany. So far as thelegislationallows, the actions of apersonacting as an auditor are valid in favour of someone dealing with theCompanyin good faith, even if there was some defect in theperson’sappointment or thepersonwas at any time not qualified to act as an auditor.
138	Auditors at General Meetings
	An auditor can attend anyGeneral Meeting. He can speak atGeneral Meetingson any business which is relevant to him as auditor.

NOTICES

139	Serving and delivering notices and other documents
139.1	TheCompanycan serve or deliver any offer, notice or other document, including a share certificate, on or to ashareholder:
	•	personally;
	•	by posting it in a letter (with postage paid) to the address recorded for him on theRegister;
	•	by delivering it to that address;
	•	if theshareholderis also an employee of theCompanyor one of itssubsidiaries, through the internal post system of theCompanyor thatsubsidiary;
	•	so far as thelegislationallows (and except in relation to share certificates), byelectronic mailto an electronicaddressor fax number in theUnited Kingdomnotified by theshareholderin writing or byelectronic mailto anaddressnotified to theshareholderfor that purpose; or
	•	by an advertisement published in at least one national newspaper published in the United Kingdom.
	However, Articles 139 to 145 do not affect any provision of thelegislationor theArticlesrequiring offers, notices or documents to be served in a particular way.
139.2	Any notice to be given to ashareholdermay be given by reference to theRegisteras it stands at any time within the period of 15 days before the notice is given. No change in theRegisterafter that time shall invalidate the giving of the notice.
139.3	Everypersonwho becomes entitled to a share is bound by any notice given to thepersonfrom whom he derives his title. This is so even if thepersonwho becomes entitled to their share has not been entered on theRegister. This Article 139.3 does not apply to a notice given under Section 212 of theCompanies Act.
140	Notices to joint holders
	When a notice or document is to be given to jointshareholdersit shall be given to the jointshareholderwho is listed first on theRegister, but ignoring any jointshareholderwithout a

52 May 2005

	United Kingdom address under Article 139 or Article 141. A notice given in this way is treated as given to all of the joint holders.
141	Notices for shareholders with foreign addresses
141.1	This Article 141 applies to ashareholderwhose address on theRegisteris outside theUnited Kingdom. He can give theCompanyaUnited Kingdomaddress where notices or documents can be served on him. If he does, he is entitled to have notices or documents served on him at that address. Otherwise, he is not entitled to receive any notices and documents from theCompany.
141.2	Forshareholdersregistered on a branch register notices or documents can be posted in theUnited Kingdomor in the country where the branch register is kept.
142	When notices are served or deemed to be served
142.1	If a notice, or any other kind of document, is sent through the post, it is treated as being served or delivered on the day after it was posted (or on the day after that, if second class post is used). If such a notice or document is sent to ashareholderwho is an employee of theCompanyor of one of itssubsidiariesby the relevant internal post it is treated as served or delivered on the day after it was posted. It can be proved that a notice or other document was served by post (or internal post) by showing that:
	•	the letter containing the notice or document was properly addressed; and
	•	it was put into the postal system with postage paid (where applicable).
142.2	If an advertisement is published in a newspaper as provided for in Article 139.1 then notice will be served on the date of the publication of the newspaper.
142.3	To the extent permitted by thelegislationand theseArticlesa notice or document sent byelectronic mailis treated as being served or delivered at the expiration of two hours from the time on the day it was sent. It can be proved,subject tothelegislation, that a notice or other document was served byelectronic mailby showing that it was sent in accordance with guidance issued by the Institute of Chartered Secretaries and Administrators.
142.4	If amemberis present at anyshareholdersmeeting either inpersonor byproxyor in the case of a corporatememberby a duly authorisedcompany representativehe shall be deemed to have received notice of the meeting and of the reason why it was called.
143	Serving notices and documents on shareholders who have died or are bankrupt
	This Article 143 applies where ashareholderhas died, has become of unsound mind or become bankrupt or is in liquidation, but is still registered as ashareholder. It applies whether he is registered as a sole or jointshareholder. Apersonwho isautomatically entitled to suchshareholder’sshares by lawand who proves this to the reasonable satisfaction of the Directors can give aUnited Kingdom addressfor service of notices and documents. If this is done, notices and documents must be sent to thataddress. Otherwise, if any notice, or other document, is served on theshareholdernamed on theRegister, or sent to him in accordance with theArticles, this will be valid despite his death, unsound mind, bankruptcy or liquidation. This applies even if theCompanyknew about these things. If notices or documents are served or sent in accordance with this Article 143, there is no need to send them to, or serve them in any other way on, any other people who may be involved.

53 May 2005

144	If documents are accidentally not sent
	If any notice, or other document relating to any meeting or other proceeding, is accidentally not sent, or is not received, the meeting or other proceeding will not be invalid as a result.
145	When entitlement to notices stops
	This Article 145 applies if on three consecutive occasions notices or other communications have been sent by post to ashareholderat his registered address (or, in the case of ashareholderwhose registered address is not within theUnited Kingdom, any address given by him to theCompanyfor the service of notices) but have been returned undelivered. Theshareholdershall not be entitled to receive any subsequent notice or other communication until he has given to theCompanya new registered address (or, in the case of amemberwhose registered address is not within theUnited Kingdom, a new address for the service of notices). For the purposes of this Article 145, references to a communication include references to any cheque or other instrument of payment; but nothing in this Article 145 shall entitle theCompanyto cease sending any cheque or other instrument of payment for any dividend, unless it is also entitled under Article 130.2 to do so. This Article 145 issubject tothe provisions of theCompanies Act.

WINDING UP

146

Distribution of assets in kind

If theCompanyis wound up (whether the liquidation is voluntary, under supervision of the Court, or by the Court) the liquidator can, with the authority of anextraordinary resolutionpassed by theshareholdersand any other sanction required by thelegislation, divide among theshareholdersthe whole or any part of theassetsof theCompany. This applies whether theassetsconsist of property of one kind or different kinds. For this purpose, the liquidator can set such value as he considers fair upon any property and decide how such division is carried out as betweenshareholdersor different groups ofshareholders. The liquidator can also, with the authority of anextraordinary resolutionpassed by theshareholdersand any other sanction required by thelegislation, transfer any part of theassetstotrusteesupon such trusts for the benefit ofshareholdersas the liquidator decides. The liquidation of theCompanycan then be closed and theCompanydissolved. However no past or presentshareholdercan be compelled to accept any shares or other property under this Article 146 which carries aliability.

DESTROYING DOCUMENTS

147	Destroying documents
147.1	TheCompanycan destroy:
	•	all transfer forms for shares, and documents sent to support a transfer, and any other documents which were the basis for making an entry on theRegister, after sixyearsfrom the date of registration;
	•	all dividend payment instructions and notifications of a change of address or name, after twoyearsfrom the date these were registered; and
	•	all cancelled share certificates, after oneyearfrom the date they were cancelled.

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147.2	If the Company destroys a document in accordance with Article 147.1, it is conclusively treated as having been a valid and effective document in accordance with the Company’s records relating to the document. Any action of the Company in dealing with the document in accordance with its terms before it was destroyed is conclusively treated as properly taken.
147.3	This Article 147 only applies to documents which are destroyed in good faith and if theCompanyis not on notice of any claim to which the document may be relevant.
147.4	For documents relating to shares inuncertificated form, theCompanymust also comply with anyrules(as defined in theCREST Regulations) which limit its ability to destroy these documents.
147.5	A document may be destroyed earlier than the dates mentioned in Article 147.1 if a permanent record of that document is made before its destruction.
147.6	This Article 147 does not make theCompanyliable:
	•	if it destroys a document earlier than referred to in Article 147.1; or
	•	if theCompanywould not be liable if this Article 147 did not exist.
147.7	Any document referred to in Article 147.1 may, subject to theCompanies Act, theCREST Regulationsand any other statute for the time being in force affecting theCompany, be destroyed before the end of the relevant period so long as a copy of the relevant document (whether made electronically, by microfilm, by digital imaging or by other means) has been made and is retained by theCompanyuntil the end of the relevant period.
147.8	This Article 147 applies whether a document is destroyed or disposed of in some other way.

INDEMNITY AND INSURANCE

148	Indemnity
148.1	Subject to the provisions of, and so far as is permitted by and consistent with thelegislationand the Listing Rules of theUK Listing Authority, every Director, Company Secretaryor other officer of theCompanyshall be indemnified by theCompanyout of its own funds against (a) any liability incurred by or attaching to him in connection with any negligence, default, breach of duty or breach of trust by him in relation to theCompanyor any associated company (as defined in Section 309A(6) of the Companies Act 1985) (an “Associated Company”) other than (i) any liability to theCompanyor any Associated Company and (ii) any liability of the kind referred to in Sections 309B(3) or (4) of the Companies Act 1985; and (b) any other liability incurred by or attaching to him in the actual or purported execution and/or discharge of his duties and/or the exercise or purported exercise of his powers and/or otherwise in relation to or in connection with his duties, powers or office.
	Where a Director,Company Secretaryor other officer of theCompanyis indemnified against any liability in accordance with this Article 148.1, such indemnity shall extend to all costs, charges, losses, expenses and liabilities incurred by him in relation thereto.
148.2	Article 148.1 also covers anyliabilityto pay an amount in respect of shares acquired by a nominee of theCompany.

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148.3	So far as thelegislationallows, every Director,Company Secretaryor otherofficerof theCompanyis exempted from anyliabilityto theCompanywhere thatliabilitywould be covered by theindemnityin Article 148.1.
148.4	For the purpose of this Article 148 each of the following is aRelevant Company:
	•	theCompany;
	•	anyholding companyof theCompany;
	•	any body, whether or not incorporated, in which theCompanyor suchholding companyor any of the predecessors of theCompanyor of suchholding companyhas or had any interest, whether direct or indirect; and
	•	any body, whether or not incorporated, which is in any way allied to or associated with theCompany, or anysubsidiaryof theCompanyor such other body.
148.5	Without limiting Articles 148.1 and 148.2 in any way, the Directors can arrange for theCompanyto purchase and maintain insurance for or for the benefit of anypersonswho are or may become or were at any time:
	•	Directors,officersor employees of anyRelevant Company; or
	•	trusteesof any pension fund or employees’ benefit scheme in which employees of any Relevant Company are interested.
	This includes, for example, insurance against anyliabilityincurred by suchpersonsfor any act or omission:
	•	in performing or omitting to perform their duties; and/or
	•	in exercising or omitting toexercisetheir powers; and/or
	•	in supposedly doing any of these things; and/or
	•	otherwise in relation to their duties, powers or offices in theCompanyor in anysubsidiaryof theCompanyor in any othercompanyor body undertaken at the request of theCompany.
148.6	Subject to the provisions of, and so far as is permitted by and consistent with thelegislationand the Listing Rules of theUK Listing Authority, theCompany(i) shall provide a Director,Company Secretaryor other officer of theCompanywith funds to meet expenditure incurred or to be incurred by him in defending any criminal or civil proceedings or in connection with any application under the provisions mentioned in Section 337A(2) of the Companies Act 1985 and (ii) shall do anything to enable a Director,Company Secretaryor other officer of the company to avoid incurring such expenditure, but so that the terms set out in Section 337A(4) to (6) of the Companies Act 1985 shall apply to any such provision of funds or other things done.

56 May 2005

Glossary

About the glossary

This glossary is to help readers understand theCompany’sArticles of Association. Words are explained as they are used in theArticles- they might mean different things in other documents. The glossary is not legally part of theArticles, and it does not affect their meaning. The definitions are intended to be a general guide - they are not precise.

abrogateIf thespecial rightsof a share are abrogated, they are cancelled or withdrawn.

adjournWhere a meeting breaks, to be continued at a later time or day, at the same or a different place.

allotWhen new shares are allotted, they are set aside for theperson they are intended for. This will normally be after theperson has agreed to pay for a new share, or has become entitled to a new share for any other reason. As soon as a share is allotted, thatperson gets the right to have his name put on the register of shareholders. When he has been registered, the share has also beenissued.

American Depositary SharesA dollar denominated security issued by a depositary bank which represents a shareholding in acompany’s ordinary shares. When the depositary bank issues such shares, it does so in the form of American Depositary Receipts which each represent a fixed number of such shares.

assetAnything which is of any value to its owner.

attorney An attorney is aperson who has been appointed to act for anotherperson. Thepersonis appointed by a formal document, calleda power of attorney.

automatically entitled to a share by lawIn some situations, apersonwill be entitled to have shares which are registered in somebody else’s name registered in his own name. Or he can require the shares to be transferred to anotherperson. When a shareholder dies, or the sole survivor of joint shareholders dies, hispersonal representatives have this right. If a shareholder is made bankrupt, his trustee in bankruptcy has the right.

beneficial interest (orownership) Aperson on whose behalf or for whose benefit atrustee holds shares has a beneficial interest in those shares.

brokerageCommission which is paid to a broker by acompanyissuingshares, where the broker’s clients have applied for shares.

callA call to pay money which is due on shares which has not yet been paid. This happens if acompanyissues shares which arepartly paid, where money remains to be paid tothat company for the shares. The money which has not been paid can be “called” for. If all the money to be paid on a share has been paid, the share is called afully paid(orpaid up) share.

capitaliseTo convert some or all of thereservesof acompanyinto capital (such as shares).

capital redemption reserveA reserve of funds which acompany may have to set up to keep its capital base when shares areredeemedor bought back.

casual vacancy A vacancy amongst the Directors which occurs by reason of the death, resignation or disqualification of a Director, or from the failure of an elected Director to accept

57 May 2005

his appointment, or for any other reason except the retirement of a Director in accordance with theArticles.

company representative If acompany owns shares, it can appoint aperson to be a company representative to attend a shareholders’ meeting to speak and vote for it.

consolidate When shares are consolidated, they are combined with other shares - for example every three 10p shares might be consolidated into one new 30p share.

debentureA typical debenture is a long-term borrowing by acompany. The loan usually has to be repaid at a fixed date in the future, and carries a fixed rate of interest.

declareWhen a dividend is declared, it becomes due to be paid.

dividend arrearsThis includes any dividends on shares with cumulative rights which could not be paid, but which have been carried forward.

dividend warrantA dividend warrant is similar to a cheque for a dividend.

ex dividendWhen a share goes “ex dividend”, aperson who buys it will not be entitled to the dividend which has beendeclared shortly before he bought it. When a share has gone “ex dividend”, the seller is entitled to this dividend, even though it will be paid after he has sold his share.

executed A document is executed when it is signed, or sealed or made valid in some other way.

exerciseWhen a power is exercised, it is put to use.

extraordinary resolutionA decision reached by a majority of at least 75 per cent of the votes cast.

forfeit When a share is forfeited, it is taken away from the shareholder and goes back to thecompany. This process is called “forfeiture”. This can happen if acallon apartly paid share is not paid on time.

fully paid sharesWhen all of the money which is due to acompany for a share has been paid, a share is called a fully paid (orpaid up) share.

General MeetingA meeting of theshareholdersof theCompany.

good titleIf apersonhas good title to a share, he owns it outright.

holding companyAcompany which controls anothercompany (for example by owning a majority of its shares) is called the holdingcompany of that othercompany. The othercompanyis thesubsidiary of the holdingcompany.

indemnityIf aperson gives anotherperson an indemnity, he promises to make good any losses or damage which the other might suffer. Theperson who gives the indemnity is said to indemnify the otherperson.

in issueSeeissue.

instrumentsFormal legal documents.

issueWhen a share has been issued, everything has been done to make the shareholder the owner of the share. In particular, the shareholder’s name has been put on the register of shareholders.Existing shareswhich have been issued arein issue.

58 May 2005

liabilitiesDebts and other obligations.

liable jointly and severally Where more than oneperson is liable jointly and severally it means that any one of them can be sued for the full amount, or they can all be sued together.

lien Where a company has a lien over shares, it can take the dividends, and any other payments relating to the shares which it has a lien over, or it can sell the shares, to repay the debt and so on.

membersShareholders.

negotiable instrumentA document such as a cheque, which can be freely transferred from onepersonto another.

nominal amount or valueThe value of the share in theCompany’s accounts. The nominal value of theOrdinary Shares is 10p. This value is shown on the share certificate for a share. When theCompanyissues new shares this can be for a price which is at apremiumto the nominal value. When shares are bought and sold on the stock market this can be for more, or less, than the nominal value. The nominal value is sometimes also called the “par value”.

objects of a companyThe business activities that thecompanyis authorised to carry on. TheCompany’s objects are set out in Clause 4 of its Memorandum.

ordinary resolutionA decision reached by a simple majority of votes - that is by more than 50 per cent of the votes cast.

partly paid sharesIf any money remains to be paid on a share, it is said to bepartly paid. The unpaid money can becalledfor.

personal representativesAperson who is entitled to deal with the property (“the estate”) of aperson who has died. If theperson who has died left a valid will, the will appoints “executors” who are personal representatives. If theperson died without a will, the courts will appoint one or more “administrators” to be the personal representatives.

poll On a poll vote, the number of votes which a shareholder has will depend on the number of shares which he owns. AnOrdinary Shareholder has one vote for each share he owns. A poll vote is different to ashow of handsvote, where eachperson who is entitled to vote has just one vote, however many shares he owns.

power of attorneyA formal document which legally appoints one or morepersons to act on behalf of anotherperson.

pre-emption rightsThe right of someshareholders which is given by theCompanies Act to be offered a proportion of certain classes of newlyissued shares and othersecurities before they are offered to anyone else. This offer must be made on terms which are at least as favourable as the terms offered to anyone else.

premium If acompanyissuesa new share for more than itsnominal value(for example because the market value is more than thenominal value), the amount above thenominal valueis the premium.

proxyA proxy is aperson who is appointed by ashareholder to attend a meeting and vote for thatshareholder. A proxy is appointed by using aproxy form. A proxy does not have to be ashareholder. A proxy can only vote on apoll, and not on ashow of hands.

59 May 2005

proxy formA form which ashareholder uses to appoint aproxyto attend a meeting and vote for him. Theproxy form must be delivered to theCompany before the meeting to which it relates.

quorumThe minimum number of shareholders who must be present before a meeting can start. When this number is reached, the meeting is said to be “quorate”.

rankandrankingWhen either capital or income is distributed to shareholders, it is paid out according to the rank (or ranking) of the shares. For example, a share which ranks before (or above) another share in sharing in acompany’s income is entitled to have its dividends paid first, before any dividends are paid on shares which rank below (or after) it. If there is not enough income to pay dividends on all shares, the available income must be used first to pay dividends on shares which rank first, and then to shares which rank below. The same applies for repayments of capital. Capital must be paid first to shares which rank first in sharing in thecompany’s capital, and then to shares which rank below.

recognised clearing house A “clearing house” which has been authorised to carry on business by the UK authorities. A clearing house is a central computer system for settling transactions between members of the clearing house.

recognised investment exchange An “investment exchange” which has been officially recognised by the UK authorities. An investment exchange is a place where investments, such as shares, are traded. TheLondon Stock Exchangeis arecognised investment exchange.

redeem andredemptionWhen a share is redeemed, it goes back to thecompany in return for a sum of money (the “redemption price”) which was fixed before the share wasissued. This process is called redemption. A share which can be redeemed is called a “redeemable” share.

relevant securities Any shares of acompany, except shares held as a result of share schemes for employees (such as profit sharing schemes) and some shares held by the founders of thecompany. Also included are anysecurities which can be converted into such shares, or which allow their holders tosubscribefor such shares.

relevant systemThis is a term used in thelegislation for a computer system which allows shares without share certificates to be transferred without using transfer forms. The CREST system for paperless share dealing is a “relevant system”.

renunciation Where a share has beenallotted, but nobody has been entered on the share register for the share, it can berenouncedto anotherperson. This transfers the right to have the share registered to anotherperson. This process is called renunciation.

requisition a meeting A formal process which shareholders can use to call a meeting ofshareholders. Generally speaking the shareholders who want to call a meeting must hold at least 10 per cent of theissuedshares.

reservefundA fund which has been set aside in the accounts of acompany - profits which are not paid out to shareholders as dividends, or used up in some other way, are held in a reserve fund by thecompany.

revokeTo withdraw, or cancel.

rights issue A way by which companies raise extra share capital. Usually the existingshareholders will be offered the chance to buy a certain number of new shares, depending on how many they already have. For example, shareholders may be offered the chance to buy one new share for every four they already have.

60 May 2005

rights of any shareThe rights attached to the share when it isissued, or afterwards.

securitiesAll shares, bonds and other investmentinstrumentsissued by acompany which entitle the holder to a share in the profits orassets of thatcompany, to receive a cash payment from acompanyor to subscribe for such a security.

securities sealA seal used to stamp acompany’s securities as evidence that the company hasissued them. Acompany’ssecurities seal is like thecompany’s common seal but with the additional word “securities” on it.

share premium accountIf a new share isissuedby a company for more than itsnominal value(because the market value is more than thenominal value) then the amount above thenominal value is thepremium, and the total of thesepremiums is held in areserve fund (which cannot be used to pay dividends) called the sharepremiumaccount.

show of handsA vote where eachperson who is entitled to vote has just one vote, however many shares he holds.

special noticeThis term is defined in Section 379 of theCompanies Act. Broadly, ifspecial noticeof a resolution is required, the resolution is not valid unless acompanyhas been told about the intention to propose it at least 28 days before the shareholders’meeting at which it is proposed (although in certain circumstances the meeting can be on a date less than 28 days from the date of the notice).

special resolution A decision reached by a majority of at least 75 per cent of votes cast. Shareholders must be given at least 21 days’ notice of any special resolution.

special rightsThese are the rights of a particular class of shares, as distinct from rights which apply to all shares generally. Typical examples of special rights are where the sharesrank, their rights to sharing in income andassetsand voting rights.

statutory declarationA formal way of declaring something in writing. Particular words and formalities must be used - these are laid down by the Statutory Declarations Act of 1835.

stockShares which have been converted into a singlesecurity with a different unit value. For example a shareholder with one hundred 10p shares might be converted into £10 worth of stock.

subdividing shares When shares are subdivided they are split into shares which have a smallernominal amount. For example, a 10p share might be subdivided into two 5p shares.

subject toMeans that something else has priority, or prevails, or must be taken into account. When a statement is subject to another statement this means that the first statement must be read in the light of the other statement, which will prevail if there is any conflict.

subscribe for shares To agree to take new shares in acompany (usually for a cash payment).

subsidiary undertaking Generally speaking this is acompany which is controlled by anothercompanybecause the othercompany:

• has a majority of the votes in the company either alone, or acting with others;

• is a shareholder who can appoint or remove a majority of the directors; or

• can exercise dominant influence over the company because of anything in the company’s memorandum or articles, or because of a certain kind of contract.

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take-over offerA take-over offer as defined in Section 428 of theCompanies Act.

trusteesPeople who hold property of any kind for the benefit one or more otherpeople under a kind of arrangement which the law treats as a “trust”. Thepeople whose property is held by the trustees are called thebeneficial owners.

underwriteAperson who agrees to buy new shares if they are not bought by other people underwrites the share offer.

unincorporated associations Associations, partnerships, societies and other bodies which the law does not treat as a separate legalpersonto theirmembers.

wind upThe formal process to put an end to acompany. When acompany is wound up itsassets are distributed. Theassets go first to creditors who have supplied property and services, and then to shareholders. Shares whichrankfirst in sharing in thecompany’sassets will receive any funds which are left over before any shares whichrankafter (or below) them.

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TABLE OF CONTENTS

Contents		Page
PRELIMINARY		1
1	Table A and other standard regulations do not apply	1
2	The meaning of the Articles	1
SHARE CAPITAL		5
3	Form of the Company’s share capital	5
CHANGING CAPITAL		5
4	The power to increase capital	5
5	Application of the Articles to new shares	5
6	The power to change capital	5
7	Fractions of shares	6
8	The power to reduce capital	6
9	Buying back shares	6
SHARES		7
10	The special rights of new shares	7
11	The Directors’ power to deal with shares	7
12	The Directors’ authority to allot “relevant securities” and “equity securities” and sell treasury shares	7
13	Power to pay commission and brokerage	9
14	Renunciations of allotted but unissued shares	9
15	No trusts or similar interests recognised	9
SHARES IN UNCERTIFICATED FORM		10
16	Shares without certificates, and shares which can be transferred without transfer forms	10
SHARE CERTIFICATES		10

63 May 2005

17	Certificates	10
18	Replacement share certificates	11
CALLS ON SHARES		12
19	The Directors can make calls on shares	12
20	The liability for calls	12
21	Interest and expenses on unpaid calls	12
22	Sums which are payable when a share is allotted are treated as a call	12
23	Calls can be for different amounts	13
24	Paying calls early	13
FORFEITING SHARES AND LIENS OVER SHARES		13
25	Notice following non-payment of a call	13
26	Contents of the notice	13
27	Forfeiture if the notice is not complied with	13
28	Forfeiture will include unpaid dividends	14
29	Dealing with forfeited shares	14
30	Cancelling forfeiture	14
31	The position of shareholders after forfeiture	14
32	The Company’s lien on shares	14
33	Enforcing the lien by selling the shares	15
34	Using the proceeds of the sale	15
35	Evidence of forfeiture or sale	15
CHANGING SHARE RIGHTS		16
36	Changing the special rights of shares	16
37	Class meetings	16

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38	More about the special rights of shares	16
TRANSFERRING SHARES		17
39	Transfer forms	17
40	More about transfers of shares in certificated form	17
41	The Company can refuse to register certain transfers	17
42	Closing the Register	18
43	Overseas branch registers	18
PERSONS AUTOMATICALLY ENTITLED TO SHARES BY LAW		18
44	When a shareholder dies	18
45	Registering personal representatives and so on	18
46	A person who wants to be registered must give notice	18
47	A person who wants to have another person registered must use a transfer form	19
48	The rights of people automatically entitled to shares by law	19
SHAREHOLDERS WHO CANNOT BE TRACED		19
49	Shareholders who cannot be traced	19
GENERAL MEETINGS		20
50	The Annual General Meeting	20
51	Extraordinary General Meetings	20
52	Calling an Extraordinary General Meeting	20
53	Notice of General Meetings	21
54	A General Meeting can be moved at short notice	22
PROCEEDINGS AT GENERAL MEETINGS		22
55	The chairman of a General Meeting	22
56	Security and other arrangements at General Meetings	22

65 May 2005

57	Overflow meeting rooms	22
58	The quorum needed for meetings	23
59	The procedure if there is no quorum	23
60	Adjourning meetings	23
61	Amending resolutions	24
VOTING PROCEDURES		24
62	How votes are taken	24
63	How a poll is taken	24
64	When there cannot be a poll	25
65	A meeting continues after a poll is demanded	25
66	Timing of a poll	25
67	The chairman’s casting vote	25
68	The effect of a declaration by the chairman	25
VOTING RIGHTS		26
69	The votes of shareholders	26
70	Shareholders who owe money to the Company	26
71	Suspension of rights on non-disclosure of interest	26
72	Votes of shareholders who are of unsound mind	28
73	The votes of joint holders	28
PROXIES		28
74	Completing proxy forms	28
75	Delivering proxy forms	29
76	Cancellation of a proxy’s authority	30
77	(Not in use)	30

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78	Representatives of companies	30
79	Challenging votes	31
DIRECTORS		31
80	The number of Directors	31

81	Qualification to be a Director	31
82	Directors’ fees	31
83	Special pay	31
84	Directors’ expenses	32
85	Directors’ pensions and other benefits	32
86	Appointing Directors to various posts	32
CHANGING DIRECTORS		33
87	Age limits	33
88	Retiring Directors	33
89	Eligibility for re-election	33
90	Re-electing a Director who is retiring	33
91	Election of two or more Directors	33
92	People who can be Directors	33
93	The power to fill vacancies and appoint extra Directors	34
94	Removing and appointing Directors by an ordinary resolution	34
95	When Directors are disqualified	34
DIRECTORS’ MEETINGS		35
96	Directors’ meetings	35
97	Who can call Directors’ meetings	35
98	How Directors’ meetings are called	35

67 May 2005

99	Quorum	35
100	The chairman of Directors’ meetings	36
101	Voting at Directors’ meetings	36
102	Directors can act even if there are vacancies	36
103	Directors’ meetings by video conference and telephone	36

104	Resolutions in writing	36
105	The validity of Directors’ actions	37
DIRECTORS’ INTERESTS		37
106	Directors’ interests in transactions with the Company	37
107	When Directors can vote on things which they are interested in	37
108	More about Directors’ interests	39
MINUTES		39
109	Minutes	39
DIRECTORS’ COMMITTEES		40
110	Delegating powers to committees	40
111	Committee procedure	40
DIRECTORS’ POWERS		40
112	The power to appoint attorneys	40
113	Use of the title of “Director”	41
114	Signature on cheques etc	41
115	Borrowing powers	41
116	Borrowing restrictions	41
ALTERNATE DIRECTORS		43
117	Alternate Directors	43

68 May 2005

THE COMPANY SECRETARY		44
118	The Company Secretary and Deputy and Assistant Company Secretaries	44
THE SEAL		44
119	The Seal	44
AUTHENTICATING DOCUMENTS		45
120	Establishing that documents are genuine	45

RESERVES		45
121	Setting up reserves	45
122	Assets bought as from a past date	45
DIVIDENDS		46
123	Final dividends	46
124	Fixed and interim dividends	46
125	Dividends not in cash	46
126	Apportioning dividends	46
127	Deducting amounts owing from dividends and other money	47
128	Payments to shareholders	47
129	Record dates for payments and other matters	48
130	Dividends which are not claimed	48
131	Waiver of dividends	48
CAPITALISING RESERVES		48
132	Capitalising reserves	48
SCRIP DIVIDENDS		49
133	Shareholders can be offered the right to receive extra shares instead of cash dividends	49
ACCOUNTS		51

69 May 2005

134	Accounting and other records	51
135	Location and inspection of records	51
136	Sending copies of accounts and other documents	51
AUDITORS		52
137	Acts of Auditors	52
138	Auditors at General Meetings	52
NOTICES		52

139	Serving and delivering notices and other documents	52
140	Notices to joint holders	52
141	Notices for shareholders with foreign addresses	53
142	When notices are served or deemed to be served	53
143	Serving notices and documents on shareholders who have died or are bankrupt	53
144	If documents are accidentally not sent	54
145	When entitlement to notices stops	54
WINDING UP		54
146	Distribution of assets in kind	54
DESTROYING DOCUMENTS		54
147	Destroying documents	54
INDEMNITY AND INSURANCE		55
148	Indemnity	55
Glossary		57

70 May 2005