ARTICLES OF ASSOCIATION
of
COLT TELECOM GROUP
public limited company
(Articles adopted by Special Resolution passed 23rd May, 2002)
Part 1
Particular Provisions
Authorised Share Capital
1. (A) The authorised share capital of the company at the date of adoption
of this paragraph of this article is(pound)51,875,000 divided into
2,075,000,000 ordinary shares of 2.5p each.
Borrowing Powers
1. (B) The board may exercise all the powers of the company to borrow money
and to mortgage or charge all or any part of the undertaking,
property and assets (present and future) and uncalled capital of the
company and to issue debentures and other securities, whether
outright or as collateral security for any debt, liability or
obligation of the company or of any third party.
Votes of Members
1. (C) Subject to any special terms as to voting upon which any shares may
be issued or may for the time being be held and to any other
provisions of these articles, on a show of hands every member who is
present in person at a general meeting of the company shall have one
vote, and on a poll every member who is present in person or by
proxy shall have one vote for every share of which he is the holder.
Suspension of Rights Where Non-Disclosure of Interest
1. (D) (i) Where the holder of any shares in the company, or any other
person appearing to be interested in those shares, fails to
comply within the relevant period with any
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statutory notice in respect of those shares, the company may
give the holder of those shares a further notice (a
"restriction notice") to the effect that from the service of
the restriction notice those shares will be subject to some or
all of the relevant restrictions, and from service of the
restriction notice those shares shall, notwithstanding any
other provisions of these articles, be subject to those
relevant restrictions accordingly.
(ii) If after the service of a restriction notice in respect of any
shares the board is satisfied that all information required by
any statutory notice relating to those shares or any of them
from their holder or any other person appearing to be
interested in the shares the subject of the restriction notice
has been supplied, the company shall, within 7 days, cancel
the restriction notice. The company may at any time at its
discretion cancel or suspend any restriction notice or exclude
any shares from it. A restriction notice shall automatically
cease to have effect in respect of any shares transferred
where the transfer has been shown to the company to be
pursuant to an arm's length sale of those shares.
(iii) Where any restriction notice is cancelled or ceases to have
effect, any moneys withheld by reason of that notice shall be
paid without interest to the person who would but for the
notice have been entitled to them or as he may direct.
(iv) Any new shares in the company issued in right of any shares
subject to a restriction notice shall also be subject to the
restriction notice, and the board may make any right to an
allotment of the new shares subject to restrictions
corresponding to those which will apply to those shares by
reason of the restriction notice when such shares are issued.
(v) Any holder of shares on whom a restriction notice has been
served may at any time request the company to give in writing
the reason why the restriction notice has been served, or why
it remains uncancelled, and within 14 days of receipt of such
a notice the company shall give that information accordingly.
(vi) If a statutory notice is given by the company to a person
appearing to be interested in any share, a copy shall at the
same time be given to the holder, but the failure or
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omission to do so or the non-receipt of the copy by the holder
shall not invalidate such notice.
(vii) This article is in addition to, and shall not in any way
prejudice or affect, the statutory rights of the company
arising from any failure by any person to give any information
required by a statutory notice within the time specified in
it. For the purpose of this article a statutory notice need
not specify the relevant period, and may require any
information to be given before the expiry of the relevant
period.
(viii) In this article:
"arm's length sale" means a sale of the entire interest in the
shares the subject of the sale on a recognised stock exchange
or a stock exchange on which shares in the company of that
description are normally traded, or a sale of such an entire
interest otherwise than on such a stock exchange to a person
who had no interest in those shares at the time the relevant
statutory notice was served and who is not an associate
(within the definition of that expression in any statute
relating to insolvency in force at the date of adoption of
this article) of a person who had such an interest and who is
not acting in concert (within the definition of that
expression in any code on take-overs and mergers generally
applicable in the United Kingdom at the date of adoption of
this article) with a person who had such an interest;
"person appearing to be interested" in any shares shall mean
any person named in a response to a statutory notice as being
so interested or shown in any register kept by the company
under the Companies Acts as so interested or, taking into
account a response or failure to respond in the light of the
response to any other statutory notice and any other relevant
information, any person whom the company has reasonable cause
to believe is so interested;
"person with a 0.25 per cent. interest" means a person who
holds, or is shown in any register kept by the company under
the Companies Acts as having an interest in, shares in the
company which comprise in total at least 0.25 per cent. in
number or nominal value of the shares of the company, or of
any class of such shares, in issue at the date of service of
the statutory notice or the restriction notice (as the case
may be);
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"relevant period" means 14 days;
"relevant restrictions" means in the case of a restriction
notice served on a person with a 0.25 per cent. interest that
(a) the shares shall not confer on the holder any right to
attend or vote either personally or by proxy at any
general meeting of the company or at any separate
general meeting of the holders of any class of shares in
the company;
(b) the board may withhold payment of all or any part of any
dividends or other moneys payable in respect of the
shares; and
(c) the board may decline to register a transfer of all or
any of the shares which are certificated shares unless
such a transfer is shown to the board to be pursuant to
an arm's length sale
and in any other case mean only the restriction specified in
sub-paragraph (a) of this definition;
"statutory notice" means a notice served by the company under
the Companies Acts requiring particulars of interests in
shares or of the identity of persons interested in shares.
Number of Directors
1. (E) Unless otherwise determined by ordinary resolution of the company,
the directors (disregarding alternate directors) shall be not less
than two nor more than nine in number.
Directors' Fees
1. (F) Each of the directors shall be paid a fee at such rate as may from
time to time be determined by the board provided that the aggregate
of all fees so paid to directors (excluding amounts payable under
any other provision of these articles) shall not exceed
(pound)150,000 per annum or such higher amount as may from time to
time be decided by ordinary resolution of the company.
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Vacation of Office by Directors
1. (G) Without prejudice to any of the provisions for disqualification of
directors or for retirement by rotation contained in these articles,
the office of a director shall be vacated if, by notice in writing
delivered to the office or tendered at a meeting of the board, his
resignation is requested by all of the other directors and all of
the other directors are not less than three in number. In this
article reference to any notice being in writing includes the
results of the use of electronic communications, subject to such
terms and conditions as the board may decide.
Uncertificated Shares
1. (H) (i) The board may determine that title to shares of any class of
shares may be evidenced otherwise than by a certificate and
that title to shares of that class may be transferred by means
of a relevant system. The board may also, subject to
compliance with the Uncertificated Securities Regulations and
the rules of any relevant system, determine at any time that
any uncertificated class of shares shall from a date specified
by the board cease to be an uncertificated class. For the
avoidance of doubt, shares which are uncertificated shares
shall not be treated as forming a class which is separate from
certificated shares with the same rights.
(ii) In relation to a class of shares, or each part of a class of
shares which is, for the time being, an uncertificated class
and for so long as it or that part remains a participating
class, no provision of these Articles (or any other current
term of issue of the class of shares) shall (notwithstanding
anything contained in these Articles or any other current
terms of issue) apply or have effect to the extent that it is
inconsistent in any respect with:-
(a) the holding of shares of that class in uncertificated
form;
(b) the transfer of title to shares of that class by means
of a relevant system; and
(c) any provision of the Uncertificated Securities
Regulations.
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(iii) All or part of shares of a class which is for the time being a
participating class may be changed from uncertificated shares
to certificated shares, and from certificated shares to
uncertificated shares, in accordance with and subject as
provided in the Uncertificated Securities Regulations and the
rules of any relevant system, and the board shall record on
the register of members that the shares are held in
certificate or uncertificated form as appropriate provided
that the company may, by notice in writing to the holder
concerned require the holder of a particular share or shares
to change the form of such share or shares from uncertificated
to certificated form within such period as may be specified in
the notice, being not less than seven days. In this paragraph
of this article reference to notice in writing includes notice
given by the use of electronic communications.
Separate General Meetings
1. (I) The provisions of these articles relating to general meetings
shall apply, with any necessary modifications, to any separate
general meeting of the holders of shares of a class convened
otherwise than in connection with the variation or abrogation
of the rights attached to the shares of that class. For this
purpose, a general meeting at which no holder of a share other
than an ordinary share may, in his capacity as a member,
attend or vote shall also constitute a separate general
meeting of the holders of the ordinary shares.
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Part 2
General Provisions
Interpretation
Exclusion of Table A
2. No regulations set out in any statute, or in any statutory instrument or
other subordinate legislation made under any statute, concerning companies
shall apply as the regulations or articles of the company.
Definitions
3. In these articles unless the context otherwise requires:-
"address" in relation to electronic communications, includes any number or
address used for the purposes of such communications;
"these articles" means these articles of association as altered from time
to time by special resolution and the expression "this article" shall be
construed accordingly;
"the auditors" means the auditors for the time being of the company or, in
the case of joint auditors, any one of them;
"the board" means the board of directors from time to time of the company
or the directors present at a meeting of the directors at which a quorum
is present;
"certificated share" means a share which is not an uncertificated share;
"clear days" in relation to the period of a notice means that period
excluding the day when the notice is served or deemed to be served and the
day for which it is given or on which it is to take effect;
"the Companies Acts" means every statute (including any orders,
regulations or other subordinate legislation made under it) from time to
time in force concerning companies in so far as it applies to the company;
"electronic signature" means anything in electronic form which the board
requires to be incorporated into or otherwise associated with an
electronic communication for the purpose of establishing the authenticity
or integrity of the communication;
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"the holder" in relation to any shares means the member whose name is
entered in the register as the holder of those shares;
"the Listing Rules" means the rules which are made from time to time by
the relevant competent authority of the United Kingdom for the purposes of
the regulation of the official listing of the company's securities;
"member" means a member of the company;
"the office" means the registered office of the company;
"ordinary shares" means ordinary shares in the capital of the company;
"paid up" means paid up or credited as paid up;
"participating class" means a class of shares title to which is permitted
by an Operator to be transferred by means of a relevant system;
"person entitled by transmission" means a person whose entitlement to a
share in consequence of the death or bankruptcy of a member or of any
other event giving rise to its transmission by operation of law has been
noted in the register;
"the register" means the register of members of the company;
"seal" means any common or official seal that the company may be permitted
to have under the Companies Acts;
"the secretary" means the secretary, or (if there are joint secretaries)
any one of the joint secretaries, of the company and includes an assistant
or deputy secretary and any person appointed by the board to perform any
of the duties of the secretary;
"the London Stock Exchange" means the London Stock Exchange plc;
"shares" means ordinary shares;
"uncertificated class" means a class of shares or part of a class of
shares which the Board has determined may be held in uncertificated form
and title to shares of that class may be transferred by means of a
relevant system;
"uncertificated share" means a share title to which is recorded on the
register as being held in uncertificated form;
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"Uncertificated Securities Regulations" means the Uncertificated
Securities Regulations 1995 as amended from time to time and any
provisions of or under the Companies Acts which supplement or replace such
Regulations;
"United Kingdom" means Great Britain and Northern Ireland;
references to a document being executed include references to its being
executed under hand or under seal or by any other method, except by means
of an electronic signature;
references to a document being signed or to signature include references
to its being executed under hand or under seal or by any other method and,
in the case of an electronic communication, are to its bearing an
electronic signature
references to writing include references to any method of representing or
reproducing words in a legible and non-transitory form including by way of
electronic communications where specifically provided in a particular
article or where permitted by the board in its absolute discretion;
words or expressions to which a particular meaning is given by the
Companies Acts in force when these articles or any part of these articles
are adopted bear (if not inconsistent with the context) the same meaning
in these articles or that part (as the case may be) save that the word
"company" shall include any body corporate; and
references to a meeting shall not be taken as requiring more than one
person to be present if any quorum requirement can be satisfied by one
person.
Headings and notes are included only for convenience and shall not affect
meaning.
In the event of any conflict between part 1 and part 2 of these articles,
part 1 shall prevail.
Form of Resolution
4. (A) Subject to the Companies Acts, where for any purpose an ordinary
resolution of the company is required, a special or extraordinary
resolution shall also be effective and where for any purpose an
extraordinary resolution is required a special resolution shall also
be effective.
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(B) A resolution in writing signed by or on behalf of each member who
would have been entitled to vote upon it if it had been proposed at
a general meeting at which he was present shall be as effectual as
if it had been passed at a general meeting properly convened and
held and may consist of several instruments in the like form each
signed by or on behalf of one or more of the members. In this
paragraph of this article reference to a resolution being in writing
includes the results of the use of electronic communications,
subject to such terms and conditions as the board may decide.
Share Capital
Rights Attached to Shares
5. Subject to the provisions of the Companies Acts and to any rights
conferred on the holders of any other shares, any share may be issued with
or have attached to it such rights and restrictions as the company may by
ordinary resolution decide or, if no such resolution has been passed or so
far as the resolution does not make specific provision, as the board may
decide.
Redeemable Shares
6. Subject to the provisions of the Companies Acts and to any rights
conferred on the holders of any other shares, any share may be issued
which is to be redeemed, or is to be liable to be redeemed at the option
of the company or the holder.
Purchase of Own Shares
7. Subject to the provisions of the Companies Acts and to any rights
conferred on the holders of any class of shares, the company may purchase
or may enter into a contract under which it will or may purchase all or
any of its shares of any class, including any redeemable shares but so
that if there shall be in issue any securities admitted to listing on the
London Stock Exchange which are convertible into equity share capital of
the class proposed to be purchased, then the company shall not purchase,
or enter into a contract under which it will or may purchase, shares of
that class unless either:-
(i) the terms of the issue of such convertible securities permit the
company to do so; or
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(ii) the purchase, or the contract, has first been approved by an
extraordinary resolution passed at a separate general meeting of the
holders of such convertible securities.
Neither the company nor the board shall be required to select the shares
to be purchased rateably or in any other particular manner as between the
holders of shares of the same class or as between them and the holders of
shares of any other class or in accordance with the rights as to dividends
or capital conferred by any class of shares.
Variation of Rights
8. Subject to the provisions of the Companies Acts, all or any of the rights
for the time being attached to any class of shares for the time being
issued may from time to time (whether or not the company is being wound
up) be varied either with the consent in writing of the holders of not
less than three-fourths in nominal value of the issued shares of that
class or with the sanction of an extraordinary resolution passed at a
separate general meeting of the holders of those shares. All the
provisions of these articles as to general meetings of the company shall
with any necessary modifications apply to any such separate general
meeting, but so that the necessary quorum shall be a person or persons
holding or representing by proxy not less than one-third in nominal value
of the issued shares of the class, (but so that at any adjourned meeting
of the holders one holder present in person or by proxy (whatever the
number of shares held by him) shall be a quorum), that every holder of
shares of the class shall be entitled on a poll to one vote for every
share of the class held by him and that any holder of shares of the class
present in person or by proxy may demand a poll.
Pari Passu Issues
9. The rights conferred upon the holders of any shares shall not, unless
otherwise expressly provided in the rights attaching to those shares, be
deemed to be varied by the creation or issue of further shares ranking
pari passu with them.
Unissued Shares
10. Subject to the provisions of the Companies Acts and these articles, the
unissued shares of the company (whether forming part of the original or
any increased capital) shall be at the disposal of the board which may
offer, allot, grant options over or otherwise dispose of them to such
persons, at such times and for such consideration and upon such terms as
the board may decide.
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Payment of Commission
11. The company may in connection with the issue of any shares exercise all
powers of paying commission and brokerage conferred or permitted by the
Companies Acts.
Trusts Not Recognised
12. Except as ordered by a court of competent jurisdiction or as required by
law, no person shall be recognised by the company as holding any share
upon any trust and the company shall not be bound by or required in any
way to recognise (even when having notice of it) any interest in any share
other than an absolute right to the whole of the share in the holder.
Certificates
Right to Share Certificates
13. Subject to the provisions of the Uncertificated Securities Regulations,
the rules of any relevant system and these articles, every person (except
a person to whom the company is not by law required to issue a
certificate), whose name is entered in the register as a holder of any
certificated shares shall be entitled, without payment, to receive within
whichever is the earlier of (a) the time required by the listing rules of
the London Stock Exchange or (b) two months after allotment or within two
months after the relevant Operator instruction is received by the company
(or within such other period as the terms of issue shall provide) one
certificate for all those shares of any one class or several certificates
each for one or more of the shares of the class in question upon payment
for every certificate after the first of such reasonable out-of-pocket
expenses as the board may from time to time decide. In the case of a
certificated share held jointly by several persons, delivery of a
certificate to one of several joint holders shall be sufficient delivery
to all. A member who transfers some but not all of the shares comprised in
a certificate shall be entitled to a certificate for the balance without
charge.
Replacement of Share Certificates
14. If a share certificate is defaced, worn out, lost or destroyed, it may be
replaced without fee but on such terms (if any) as to evidence and
indemnity and to payment of any exceptional out-of-pocket expenses of the
company in investigating the evidence and preparing the indemnity as the
board may decide and, where it is defaced or worn out, after delivery of
the old certificate to the company.
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Execution of Share Certificates
15. Every share certificate shall be executed under a seal or in such other
manner as the board having regard to the terms of issue and any listing
requirements may authorise, and shall specify the number and class of the
shares to which it relates and the amount or respective amounts paid up on
the shares. The board may by resolution decide, either generally or in any
particular case or cases, that any signatures on any share certificates
need not be autographic but may be applied to the certificates by some
mechanical means or may be printed on them or that the certificates need
not be signed by any person.
Lien
Company's Lien on Shares Not Fully Paid
16. The company shall have a first and paramount lien on every share (not
being a fully paid share) for all amounts payable to the company (whether
presently or not) in respect of that share. The company's lien on a share
shall extend to every amount payable in respect of it. The board may at
any time either generally or in any particular case waive any lien that
has arisen or declare any share to be wholly or in part exempt from the
provisions of this article.
Enforcing Lien by Sale
17. The company may sell, in such manner as the board may decide, any shares
on which the company has a lien if a sum in respect of which the lien
exists is presently payable and is not paid within fourteen clear days
after a notice in writing has been served on the holder of the shares,
demanding payment and stating that if the notice is not complied with the
share or the person who is entitled by transmission to the share and who
has supplied the company with an address within the United Kingdom for the
service of notices, demanding payment and stating that if the notice is
not complied with the share may be sold. For giving effect to the sale the
board may authorise some person to execute an instrument of transfer of
the share sold to or in accordance with the directions of the purchaser.
The transferee shall not be bound to see to the application of the
purchase money, nor shall his title to the shares be affected by any
irregularity or invalidity in reference to the sale.
Application of Proceeds of Sale
18. The net proceeds, after payment of the costs, of the sale by the company
of any share on which it has a lien shall be applied in or
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towards payment or discharge of the debt or liability in respect of which
the lien exists so far as it is presently payable, and any residue shall
(subject to a like lien for debts or liabilities not presently payable as
existed upon the share prior to the sale and upon surrender, if required
by the company, for cancellation of the certificate for the share sold) be
paid to the person who was entitled to the share at the time of the sale.
Calls on Shares
Calls
19. Subject to the terms of issue, the board may from time to time make calls
upon the members in respect of any moneys unpaid on their shares (whether
on account of the nominal amount of the shares or by way of premium) and
not payable on a date fixed by or in accordance with the terms of issue,
and each member shall (subject to the company serving upon him at least
fourteen clear days' notice specifying when and where payment is to be
made) pay to the company as required by the notice the amount called on
his shares. A call may be revoked or postponed as the board may decide. A
person upon whom a call is made shall remain liable for all calls made
upon him notwithstanding the subsequent transfer of the shares in respect
of which the call was made.
Payment on Calls
20. A call may be made payable by instalments and shall be deemed to have been
made at the time when the resolution of the board authorising the call was
passed.
Liability of Joint Holders
21. The joint holders of a share shall be jointly and severally liable to pay
all calls in respect of the share.
Interest Due on Non-Payment
22. If a call remains unpaid after it has become due and payable, the person
from whom it is due and payable shall pay interest on the amount unpaid
from the day it is due and payable to the time of actual payment at such
rate, not exceeding 15 per cent. per annum, as the board may decide, but
the board shall be at liberty to waive payment of the interest wholly or
in part.
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Sums Due on Allotment Treated as Calls
23. Any amount which becomes payable in respect of a share on allotment or on
any other date fixed by or in accordance with the terms of issue, whether
in respect of the nominal amount of the share or by way of premium or as
an instalment of a call, shall be deemed to be a call and, if it is not
paid, all the provisions of these articles shall apply as if the sum had
become due and payable by virtue of a call.
Power to Differentiate
24. Subject to the terms of issue, the board may on the issue of shares
differentiate between the allottees or holders as to the amount of calls
to be paid and the times of payment.
Payment of Calls in Advance
25. The board may, if it thinks fit, receive from any member who is willing to
advance them all or any part of the moneys uncalled and unpaid upon any
shares held by him and upon all or any of the moneys so advanced may
(until they would, but for the advance, become presently payable) pay
interest at such rate, not exceeding (unless the company by ordinary
resolution shall otherwise direct) 15 per cent. per annum, as the board
may decide.
Forfeiture of Shares
Notice if Call or Instalment Not Paid
26. If any call or instalment of a call remains unpaid on any share after the
day appointed for payment, the board may at any time serve a notice on the
holder requiring payment of so much of the call or instalment as is
unpaid, together with any interest which may have accrued and any expenses
incurred by the company by reason of such non payment.
Form of Notice
27. The notice shall name a further day (not being less than fourteen clear
days from the date of the notice) on or before which, and the place where,
the payment required by the notice is to be made and shall state that in
the event of non-payment on or before the day and at the place appointed,
the shares in respect of which the call was made or instalment is payable
will be liable to be forfeited. The board may accept the surrender of any
share liable to be forfeited
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and, in that event, references in these articles to forfeiture shall
include surrender.
Forfeiture if Non-Compliance with Notice
28. If the notice is not complied with, any share in respect of which it was
given may, at any time before payment of all calls or instalments and
interest and expenses due in respect of it has been made, be forfeited by
a resolution of the board to that effect and the forfeiture shall include
all dividends declared and other moneys payable in respect of the
forfeited shares and not paid before the forfeiture.
Notice after Forfeiture
29. When any share has been forfeited, notice of the forfeiture shall be
served upon the person who was before forfeiture the holder of the share
but no forfeiture shall be invalidated by any omission or neglect to give
the notice.
Sale of Forfeited Shares
30. Until cancelled in accordance with the requirements of the Companies Acts,
a forfeited share shall be deemed to be the property of the company and
may be sold, re-allotted or otherwise disposed of either to the person who
was, before forfeiture, the holder or to any other person upon such terms
and in such manner as the board shall decide. The board may for the
purposes of the disposal authorise some person to execute an instrument of
transfer to the designated transferee. The company may receive the
consideration (if any) given for the share on its disposal and if the
share is in registered form may register the transferee as the holder of
the share. At any time before a sale, re-allotment or disposition the
forfeiture may be cancelled by the board on such terms as the board may
decide.
Arrears to be Paid Notwithstanding Forfeitures
31. A person whose shares have been forfeited shall cease to be a member in
respect of them and shall surrender to the company for cancellation the
certificate for the forfeited shares but shall remain liable to pay to the
company all moneys which at the date of the forfeiture were payable by him
to the company in respect of those shares with interest thereon at the
rate of 15 per cent. per annum (or such lower rate as the board may
decide) from the date of forfeiture until payment, and the company may
enforce payment without being under any obligation to make any allowance
for the value of the shares forfeited or for any consideration received on
their disposal.
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Statutory Declaration as to Forfeiture
32. A statutory declaration that the declarant is a director of the company or
the secretary and that a share has been forfeited on a specified date
shall be conclusive evidence of the facts stated in it as against all
persons claiming to be entitled to the share. The declaration shall
(subject to the execution of an instrument of transfer if necessary)
constitute a good title to the share and the person to whom the share is
disposed of shall not be bound to see to the application of the purchase
money (if any) nor shall his title to the share be affected by any
irregularity or invalidity in the proceedings relating to the forfeiture,
sale, re-allotment or disposal.
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Transfer of Shares
Transfer of Shares
33. Subject to such of the restrictions of these articles as may be applicable
(a) any member may transfer all or any of his uncertificated shares by
means of a relevant system in such manner provided for, and subject
as provided, in the Uncertificated Securities Regulations and the
rules of any relevant system and accordingly no provision of these
articles shall apply in respect of an uncertificated share to the
extent that it requires or contemplates the effecting of a transfer
by an instrument in writing or the production of a certificate for
the share to be transferred; and
(b) any member may transfer all or any of his certificated shares by an
instrument of transfer in any usual form or in any other form which
the board may approve.
Execution of Transfer
34. The instrument of transfer of a certificated share shall be executed by or
on behalf of the transferor and (in the case of a partly paid share) the
transferee, and the transferor shall be deemed to remain the holder of the
share until the name of the transferee is entered in the register in
respect of it. All instruments of transfer, when registered, may be
retained by the company.
Rights to Decline Registration of Partly Paid Shares
35. The board may, in its absolute discretion and without giving any reason
for so doing, decline to register any transfer of any share which is not a
fully paid share.
Other Rights to Decline Registration
36. (A) The board may decline to register any transfer of a certificated
share unless:-
(a) the instrument of transfer is lodged with the company
accompanied (save in the case of a transfer by a person to
whom the company is not required by law to issue a
certificate) by the certificate for the shares to which it
relates and such other evidence as the board may reasonably
require to show the right of the transferor to
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make the transfer (and, if the instrument of transfer is
executed by some other person on his behalf, the authority of
that person to do so),
(b) the instrument of transfer is in respect of only one class of
share, and
(c) in the case of a transfer to joint holders, the number of
joint holders to whom the share is to be transferred does not
exceed four.
(B) The board may only decline to register a transfer of an
uncertificated share in the circumstances set out in the
Uncertificated Securities Regulations, and where, in the case of a
transfer to joint holders, the number of joint holders to whom the
uncertificated share is to be transferred exceeds four.
Notice of Refusal
37. If the board declines to register a transfer of a share it shall, within
two months after the date on which the instrument of transfer was lodged
or, in the case of uncertificated shares, within two months after the date
on which the relevant Operator-instruction is received, send to the
transferee notice of the refusal.
No Fee for Registration
38. No fee shall be charged by the company for registering any transfer or
document relating to or affecting the title to any share or for making any
other entry in the register.
Untraced Shareholders
39. The company may sell any certificated shares in the company on behalf of
the holder of, or person entitled by transmission to, the shares by
instructing a member of the London Stock Exchange to sell them at best
price if:-
(a) the shares have been in issue either in certificated or
uncertificated form throughout the qualifying period and at least
three cash dividends have become payable on the shares during the
qualifying period,
(b) no cash dividend payable on the shares has either been claimed by
presentation to the paying bank of the relevant cheque or warrant or
been satisfied by the transfer of funds to a bank
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account designated by the holder of, or person entitled by
transmission to, the shares or by the transfer of funds by means of
a relevant system at any time during the relevant period,
(c) so far as any director of the company at the end of the relevant
period is then aware, the company has not at any time during the
relevant period received any communication from the holder of, or
person entitled by transmission to, the shares,
(d) the company has caused two advertisements to be published, one in a
newspaper with a national circulation and the other in a newspaper
circulating in the area in which the last known address of the
holder of, or person entitled by transmission to, the shares or the
address at which service of notices may be effected under the
articles is located, giving notice of its intention to sell the
shares and a period of three months has elapsed from the date of
publication of the advertisements or of the last of the two
advertisements to be published if they are published on different
dates, and
(e) the company has given notice to the London Stock Exchange of its
intention to make the sale.
For the purpose of this article:
"the qualifying period" means the period of twelve years immediately
preceding the date of publication of the advertisements referred to in
sub-paragraph (d) above or of the first of the two advertisements to be
published if they are published on different dates; and
"the relevant period" means the period beginning at the commencement of
the qualifying period and ending on the date when all the requirements of
sub-paragraphs (a) to (e) above have been satisfied.
If during any relevant period further shares have been issued in right of
those held at the beginning of that relevant period or of any previously
so issued during that relevant period and all the requirements of
sub-paragraphs (b) to (e) above have been satisfied in regard to the
further shares, the company may also sell the further shares.
To give effect to any sale of shares pursuant to this article the board
may authorise some person to transfer the certificated shares in question
and an instrument of transfer executed by that person shall be as
effective as if it had been executed by the holder of, or person entitled
by transmission to, the shares. The purchaser shall
21
not be bound to see to the application of the purchase moneys nor shall
his title to the shares be affected by any irregularity or invalidity in
the proceedings relating to the sale. The net proceeds of sale shall
belong to the company and, upon their receipt, the company shall become
indebted to the former holder of, or person entitled by transmission to,
the shares for an amount equal to the net proceeds. No trust shall be
created in respect of the debt and no interest shall be payable in respect
of it and the company shall not be required to account for any moneys
earned from the net proceeds which may be employed in the business of the
company or as it thinks fit.
Transmission of Shares
Transmission on Death
40. If a member dies, the survivor or survivors, where he was a joint holder,
and his personal representatives, where he was a sole holder or the only
survivor of joint holders, shall be the only persons recognised by the
company as having any title to his shares; but nothing contained in these
articles shall release the estate of a deceased holder from any liability
in respect of any share held by him solely or jointly with other persons.
Entry of Transmission in Register
41. Where the entitlement of a person to a share in consequence of the death
or bankruptcy of a member or of any other event giving rise to its
transmission by operation of law is proved to the satisfaction of the
board, the board shall within two months after proof cause the entitlement
of that person to be noted in the register.
Election of Person Entitled by Transmission
42. Any person entitled by transmission to a share may, subject as provided
elsewhere in these articles, elect either to become the holder of the
share or to have some person nominated by him registered as the holder. If
he elects to be registered himself he shall give notice to the company to
that effect. If he elects to have another person registered, he shall
transfer title to the share to that person. All the provisions of these
articles relating to the transfer of shares shall apply to the notice or
transfer as if the death or bankruptcy of the member or other event giving
rise to the transmission had not occurred and the notice or transfer was
given or executed by the member.
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Rights of Person Entitled by Transmission
43. Where a person becomes entitled by transmission to a share, the rights of
the holder in relation to that share shall cease, but the person entitled
by transmission to the share may give a good discharge for any dividends
or other moneys payable in respect of it and shall have the same rights in
relation to the share as he would have had if he were the holder of it
save that, until he becomes the holder, he shall not be entitled in
respect of the share to attend or vote at any general meeting of the
company or at any separate general meeting of the holders of any class of
shares in the company. The board may at any time give notice requiring the
person to elect either to be registered himself or to transfer the share
and if the notice is not complied with within sixty days the board may
withhold payment of all dividends and other moneys payable in respect of
the share until the requirements of the notice have been complied with.
Alteration of Share Capital
Increase, Consolidation, Sub-Division and Cancellation
44. The company may from time to time by ordinary resolution:-
(a) increase its share capital by such sum to be divided into shares of
such amount as the resolution shall prescribe;
(b) consolidate and divide all or any of its share capital into shares
of larger amount than its existing shares;
(c) sub-divide its shares or any of them into shares of smaller amount
and the resolution may determine that, as between the shares
resulting from the sub-division, any of them may have any preference
or advantage or be subject to any restriction as compared with the
others; and
(d) cancel any shares which, at the date of the passing of the
resolution, have not been taken or agreed to be taken by any person
and diminish the amount of its share capital by the amount of the
shares so cancelled.
Fractions
45. Whenever as a result of a consolidation of shares any members would become
entitled to fractions of a share, the board may deal with the fractions as
it thinks fit and in particular may sell the shares representing the
fractions to any person (including, subject to the provisions of the
Companies Acts, the company) and distribute the net
23
proceeds of sale in due proportion among those members and the board may
authorise some person to transfer or deliver the shares to, or in
accordance with the directions of, the purchaser. The person to whom any
shares are transferred or delivered shall not be bound to see to the
application of the purchase money nor shall his title to the shares be
affected by any irregularity in, or invalidity of, the proceedings
relating to the sale.
Reduction of Capital
46. Subject to the provisions of the Companies Acts, the company may by
special resolution reduce its share capital, any capital redemption
reserve, any share premium account and other undistributable reserve in
any way.
General Meetings
Extraordinary General Meetings
47. Any general meeting of the company other than an annual general meeting
shall be called an extraordinary general meeting.
Annual General Meetings
48. The board shall convene and the company shall hold general meetings as
annual general meetings in accordance with the requirements of the
Companies Acts.
Convening of Extraordinary General Meetings
49. The board may convene an extraordinary general meeting whenever it thinks
fit.
Notice of General Meetings
Length of Notice
50. An annual general meeting and an extraordinary general meeting convened
for the passing of a special resolution or (save as provided by the
Companies Acts) a resolution of which special notice has been given shall
be convened by not less than twenty-one clear days' notice in writing. All
other extraordinary general meetings shall be convened by not less than
fourteen clear days' notice in writing. The notice shall specify the
place, day and time of the meeting, and the general nature of the business
to be transacted. Notice of every general meeting shall be given to all
members other than any who, under the provisions of these articles or the
terms of issue of the
24
shares they hold, are not entitled to receive such notices from the
company, and also to the auditors or, if more than one, each of them. In
this article references to notice in writing include notice given by the
use of electronic communications and publication on a website in
accordance with the Companies Acts.
Notwithstanding that a meeting of the company is convened by shorter
notice than that specified in this article, it shall be deemed to have
been properly convened if it is so agreed:-
(a) in the case of an annual general meeting, by all the members
entitled to attend and vote at the meeting; and
(b) in the case of any other meeting, by a majority in number of the
members having a right to attend and vote at the meeting, being a
majority together holding not less than 95 per cent. in nominal
value of the shares giving that right.
Omission or Non-Receipt of Notice
51. The accidental omission to give notice of a meeting or (any document
relating to the meeting) the accidental omission to send an instrument of
proxy to, or the non-receipt of any such notice or document by, any person
entitled to receive the notice shall not invalidate the proceedings at
that meeting.
Postponement of General Meetings
52. If the board, in its absolute discretion, considers that it is impractical
or unreasonable for any reason to hold a general meeting on the date or at
the time or place specified in the notice calling the general meeting, it
may postpone the general meeting to another date, time and place. When a
meeting is so postponed, notice of the date, time and place of the
postponed meeting shall be placed in at least two national newspapers in
the United Kingdom. Notice of the business to be transacted at such
postponed meeting shall not be required.
Proceedings at General Meetings
Quorum
53. No business shall be transacted at any general meeting unless a quorum is
present when the meeting proceeds to business, but the absence of a quorum
shall not preclude the choice or appointment of a chairman which shall not
be treated as part of the business of the meeting. Save as otherwise
provided by these articles, two members
25
present in person or by proxy and entitled to vote shall be a quorum for
all purposes.
Procedure if Quorum Not Present
54. If within five minutes (or such longer time not exceeding one hour as the
chairman of the meeting may decide to wait) after the time appointed for
the commencement of the meeting a quorum is not present, the meeting shall
stand adjourned to such other day (being not less than three nor more than
twenty-eight days later) and at such other time or place as may have been
specified for the purpose in the notice convening the meeting. Where no
such arrangements have been so specified, the meeting shall stand
adjourned to such other day (being not less than ten nor more than
twenty-eight days later) and at such other time or place as the chairman
of the meeting may decide and, in this case, the company shall give not
less than seven clear days' notice in writing of the adjourned meeting. At
any adjourned meeting one member present in person or by proxy (whatever
the number of shares held by him) shall be a quorum and any notice of an
adjourned meeting shall state that one member present in person or by
proxy (whatever the number of shares held by him) shall be a quorum. In
this article reference to notice being in writing includes notice given by
use of electronic communications and publication on a website in
accordance with the Companies Acts.
Security Arrangements
55. The board may direct that persons wishing to attend any general meeting
should submit to such searches or other security arrangements or
restrictions as the board shall consider appropriate in the circumstances
and shall be entitled in its absolute discretion to, or to authorise some
one or more persons who shall include a director o the secretary or the
chairman of the meeting to, refuse entry to, or to eject from, such
general meeting any person who fails to submit to such searches or to
otherwise comply with such security arrangements or restrictions.
Chairman of General Meeting
56. The chairman (if any) of the board or, in his absence, the deputy chairman
(if any) shall preside as chairman at every general meeting. If there is
no chairman or deputy chairman, or if at any meeting neither the chairman
nor any deputy chairman is present within five minutes after the time
appointed for the commencement of the meeting, or if neither the chairman
nor any deputy chairman is willing to act as chairman, the directors
present shall choose one of their number to act, or if one director only
is present he shall preside as
26
chairman if willing to act. If no director is present, or if each of the
directors present declines to take the chair, the persons present and
entitled to vote shall appoint one of their number to be chairman.
Orderly Conduct
57. The chairman shall take such action as he thinks fit to promote the
orderly conduct of the business of the meeting as laid down in the notice
of the meeting and the chairman's decision on matters of procedure or
arising incidentally from the business of the meeting shall be final as
shall be his determination as to whether any matter is of such a nature.
Entitlement to Attend and Speak
58. Each director shall be entitled to attend and speak at any general meeting
of the company and at any separate general meeting of the holders of any
class of shares in the company. The chairman may invite any person to
attend and speak at any general meeting of the company whom the chairman
considers to be equipped by knowledge or experience of the company's
business to assist in the deliberations of the meeting.
Adjournments
59. The chairman may at any time without the consent of the meeting adjourn
any meeting (whether or not it has commenced or a quorum is present)
either sine die or to another time or place where it appears to him that
(a) the members wishing to attend cannot be conveniently accommodated in
the place appointed for the meeting (b) the conduct of persons present
prevents or is likely to prevent the orderly continuation of business or
(c) an adjournment is otherwise necessary so that the business of the
meeting may be properly conducted. In addition, the chairman may at any
time with the consent of any meeting at which a quorum is present (and
shall if so directed by the meeting) adjourn the meeting either sine die
or to another time or place. When a meeting is adjourned sine die the time
and place for the adjourned meeting shall be fixed by the board. No
business shall be transacted at any adjourned meeting except business
which might properly have been transacted at the meeting had the
adjournment not taken place.
Notice of Adjournment
60. When a meeting is adjourned for three months or more, or sine die, notice
of the adjourned meeting shall be given as in the case of an
27
original meeting. Except where these articles otherwise require, it shall
not be necessary to give any notice of an adjourned meeting or of the
business to be transacted at an adjourned meeting.
Amendments
Amendments to Resolutions
61. In the case of a resolution duly proposed as a special or extraordinary
resolution no amendment thereto (other than an amendment to correct a
patent error) may be considered or voted upon and in the case of a
resolution duly proposed as an ordinary resolution no amendment thereto
(other than an amendment to correct a patent error) may be considered or
voted upon unless either at least forty-eight hours prior to the time
appointed for holding the meeting or adjourned meeting at which such
ordinary resolution is to be proposed notice in writing of the terms of
the amendment and intention to move the same has been lodged at the office
or the chairman in his absolute discretion decides that it may be
considered or voted upon.
Amendments Ruled Out of Order
62. If an amendment shall be proposed to any resolution under consideration
but shall be ruled out of order by the chairman of the meeting the
proceedings on the substantive resolution shall not be invalidated by any
error in such ruling.
Voting
Method of Voting
63. At any general meeting a resolution put to the vote of the meeting shall
be decided on a show of hands unless (before or on the declaration of the
result of the show of hands or on the withdrawal of any other demand for a
poll) a poll is properly demanded. Subject to the Companies Acts, a poll
may be demanded by:-
(a) the chairman of the meeting, or
(b) at least five members present in person or by proxy and entitled to
vote, or
(c) any member or members present in person or by proxy and representing
in the aggregate not less than one-tenth of the total voting rights
of all the members having the right to attend and vote at the
meeting, or
28
(d) any member or members present in person or by proxy and holding
shares conferring a right to attend and vote at the meeting on which
there have been paid up sums in the aggregate equal to not less than
one-tenth of the total sum paid up on all the shares conferring that
right.
Unless a poll is so demanded and the demand is not withdrawn, a
declaration by the chairman that a resolution has been carried or carried
unanimously or by a particular majority or not carried by a particular
majority or lost shall be conclusive evidence of the fact without proof of
the number or proportion of the votes recorded for or against the
resolution.
Procedure if Poll Demanded
64. If a poll is properly demanded it shall be taken in such manner as the
chairman shall direct and he may appoint scrutineers who need not be
members. The result of the poll shall be deemed to be the resolution of
the meeting at which the poll was demanded.
When Poll to be Taken
65. A poll demanded on the election of a chairman, or on a question of
adjournment, shall be taken forthwith. A poll demanded on any other
question shall be taken either forthwith or on such date (being not later
than thirty days after the date of the demand) and at such time and place
as the chairman shall direct. It shall not be necessary (unless the
chairman otherwise directs) for notice to be given of a poll.
Continuance of Other Business after Poll Demand
66. The demand for a poll shall not prevent the continuance of a meeting for
the transaction of any business other than the question on which the poll
was demanded, and it may be withdrawn with the consent of the chairman at
any time before the close of the meeting or the taking of the poll,
whichever is the earlier, and in that event shall not invalidate the
result of a show of hands declared before the demand was made.
Votes on a Poll
67. On a poll votes may be given either personally or by proxy. A member may
appoint more than one proxy to attend on the same occasion.
29
Casting Vote of Chairman
68. In the case of an equality of votes at a general meeting, whether on a
show of hands or on a poll, the chairman of the meeting shall be entitled
to an additional or casting vote.
Votes of Joint Holders
69. In the case of joint holders of a share the vote of the senior who tenders
a vote, whether in person or by proxy, shall be accepted to the exclusion
of the votes of the other joint holders and, for this purpose, seniority
shall be determined by the order in which the names stand in the register
in respect of the joint holding.
Voting on Behalf of Incapable Member
70. A member in respect of whom an order has been made by any competent court
or official on the ground that he is or may be suffering from mental
disorder or is otherwise incapable of managing his affairs may vote,
whether on a show of hands or on a poll, by any person authorised in such
circumstances to do so on his behalf and that person may vote on a poll by
proxy, provided that evidence to the satisfaction of the board of the
authority of the person claiming to exercise the right to vote has been
received at the office (or at such other place as may be specified in
accordance with these articles for the receipt of appointments of a proxy
in writing which are not electronic communications) not later than the
last time at which an instrument of proxy should have been received in
order to be valid for use at that meeting or on the holding of that poll.
No Right to Vote where Sums Overdue on Shares
71. No member shall, unless the board otherwise decides, be entitled to vote
at any general meeting of the company or at any separate general meeting
of the holders of any class of shares in the company unless all calls or
other sums presently payable by him in respect of shares in the company
have been paid.
Objections or Errors in Voting
72. If:-
(a) any objection shall be raised to the qualification of any voter, or
(b) any votes have been counted which ought not to have been counted or
which might have been rejected, or
30
(c) any votes are not counted which ought to have been counted,
the objection or error shall not vitiate the decision of the meeting or
adjourned meeting on any resolution unless it is raised or pointed out at
the meeting or, as the case may be, the adjourned meeting at which the
vote objected to is given or tendered or at which the error occurs. Any
objection or error shall be referred to the chairman and shall only
vitiate the decision of the meeting on any resolution if the chairman
decides that the same may have affected the decision of the meeting. The
decision of the chairman on such matters shall be conclusive.
Proxies
Execution of Proxies
73. An instrument appointing a proxy shall be in writing under the hand of the
appointor or his attorney authorised in writing or, if the appointor is a
corporation, either under its seal or under the hand of an officer,
attorney or other person authorised to sign it. In this article references
to an instrument appointing a proxy being in writing include the use of
electronic communications, subject to such terms and conditions as the
results of the Board may decide.
Delivery of Proxies
74. (A) The instrument appointing a proxy and (if required by the board) any
authority under which it is signed or a copy of the authority,
certified notarially or in some other manner approved by the board,
which is not an electronic communication, must be:
(i) received at the office (or to such other place in the United
Kingdom as may be specified in the notice convening the
meeting or in any notice of adjournment or, in either case, in
any accompanying document) not less than forty-eight hours
before the time appointed for holding the meeting or adjourned
meeting at which the person named in the instrument proposes
to vote;
(ii) in the case of an appointment contained in an electronic
communication, where an address has been specified for the
purpose of receiving electronic communications in the notice
convening the meeting or in any notice of any adjournment or,
in either case, in any accompanying document, received at such
address not less than 48 hours before the time appointed for
holding the meeting or
31
adjourned meeting at which the person named in the appointment
proposes to vote; or
(iii) in the case of a poll taken subsequently to the date of the
meeting or adjourned meeting, received as aforesaid not less
than twenty-four hours before the time appointed for the
taking of the poll,
and an appointment of a proxy which is not received in a manner so
permitted shall be invalid. When two or more valid but differing
instruments of proxy are delivered in respect of the same share for
use at the same meeting, the one which is last delivered (regardless
of its date or of the date of its execution) shall be treated as
replacing and revoking the others as regards that share; if the
company is unable to determine which was last delivered, none of
them shall be treated as valid in respect of that share. Delivery of
an instrument appointing a proxy shall not preclude a member from
attending and voting in person at the meeting or poll concerned.
Maximum Validity of Proxy
75. No instrument appointing a proxy shall be valid after twelve months have
elapsed from the date named in it as the date of its execution.
Form of Proxy
76. Instruments of proxy shall be in any usual form or in such other form as
the board may approve and the board may, if it thinks fit, but subject to
the provisions of the Companies Acts, send out with the notice of any
meeting forms of instrument of proxy for use at the meeting. The
instrument of proxy shall be deemed to confer authority to demand or join
in demanding a poll and to vote on any amendment of a resolution put to
the meeting for which it is given as the proxy thinks fit. The instrument
of proxy shall, unless the contrary is stated in it, be valid as well for
any adjournment of the meeting as for the meeting to which it relates.
Cancellation of Proxy's Authority
77. A vote given or poll demanded by a proxy or by the duly authorised
representative of a corporation shall be valid notwithstanding the
previous determination of the authority of the person voting or demanding
a poll, unless notice in writing of the determination was received by the
company at the office (or such other place in the United Kingdom as was
specified for the delivery of instruments of
32
proxy in the notice convening the meeting or other accompanying document)
not later than the last time at which an instrument of proxy should have
been delivered in order to be valid for use at the meeting or on the
holding of the poll at which the vote was given or the poll demanded. In
this article reference to notice in writing includes the results of the
use of electronic communications, subject to such terms and conditions as
the board may decide.
Appointment, Retirement and Removal of Directors
Age of Directors
78. No person shall be disqualified from being appointed a director, and no
director shall be required to vacate that office, by reason only of the
fact that he has attained the age of seventy years or any other age nor
shall it be necessary by reason of his age to give special notice or
comply with any other special formality in connection with his appointment
or election. Where the board convenes any general meeting of the company
at which (to the knowledge of the board) a director will be proposed for
appointment or reappointment who at the date for which the meeting is
convened will have attained the age of seventy years or more, the board
shall give notice of his age in years in the notice convening the meeting
or in any document accompanying the notice, but the accidental omission to
do so shall not invalidate any proceedings, or any appointment or
reappointment of that director, at that meeting.
Directors' Shareholding Qualification
79. No shareholding qualification for directors shall be required.
Power of Company to Appoint Directors
80. Subject to the provisions of these articles, the company may by ordinary
resolution appoint any person who is willing to act to be a director,
either to fill a vacancy or as an addition to the existing board, but so
that the total number of directors shall not at any time exceed any
maximum number fixed by or in accordance with these articles.
Power of Board to Appoint Directors
81. Without prejudice to the power of the company in general meeting pursuant
to any of the provisions of these articles to appoint any person to be a
director, the board may appoint any person who is willing to act to be a
director, either to fill a vacancy or as an addition to the existing
board, but so that the total number of
33
directors shall not at any time exceed any maximum number fixed by or in
accordance with these articles. Any director so appointed shall hold
office only until the next following annual general meeting but shall not
be taken into account in determining the directors or the number of
directors who are to retire by rotation at that meeting.
Number to Retire by Rotation
82. At every annual general meeting until 2001 one-third of the directors or,
if their number is not three or any multiple of three, then the number
nearest to and less than one-third shall retire from office but, if there
are fewer than three directors who are subject to retirement by rotation,
they shall retire. At the annual general meeting in 2002 and thereafter
all of the directors shall retire and be eligible for re-election.
Identity of Directors to Retire
83. Subject to the provisions of the Companies Acts and of these articles, the
directors to retire by rotation on each occasion shall be those who have
been longest in office since their last appointment or reappointment but,
as between persons who became or were last reappointed directors on the
same day, those to retire shall (unless they otherwise agree among
themselves) be determined by lot. The directors to retire on each occasion
(both as to number and identity) shall be determined by the composition of
the board at start of business on the date of the notice convening the
annual general meeting and no director shall be required to retire or be
relieved from retiring by reason of any change in the number or identity
of the directors after that time on the date of the notice but before the
close of the meeting.
Filling Rotation Vacancies
84. Subject to the provisions of these articles, the company at the meeting at
which a director retires by rotation may fill the vacated office and in
default the retiring director shall, if willing to continue to act, be
deemed to have been reappointed, unless at such meeting it is expressly
resolved not to fill the vacated office or unless a resolution for the
reappointment of that director has been put to the meeting and lost.
Power of Removal by Special Resolution
85. In addition to any power of removal conferred by the Companies Acts, the
company may by special resolution remove any director before the
expiration of his period of office and may (subject to these
34
articles) by ordinary resolution appoint another person who is willing to
act to be a director in his place. Any person so appointed shall be
treated, for the purpose of determining the time at which he or any other
director is to retire, as if he had become a director on the day on which
the person in whose place he is appointed was last appointed or
reappointed a director.
Persons Eligible as Directors
86. No person other than a director retiring at the meeting (whether by
rotation or otherwise) shall be appointed or reappointed a director at any
general meeting unless:-
(a) he is recommended by the board, or
(b) not less than twelve nor more than thirty five clear days before the
day appointed for the meeting, notice executed by a member qualified
to vote at the meeting (not being the person to be proposed) has
been given to the secretary of the intention to propose that person
for appointment or reappointment together with notice executed by
that person of his willingness to be appointed or reappointed.
Position of Retiring Directors
87. A director who retires (whether by rotation or otherwise) at an annual
general meeting may, if willing to continue to act, be reappointed. If he
is not reappointed or deemed to be reappointed, he shall retain office
until the meeting appoints someone in his place or, if it does not do so,
until the end of the meeting.
Vacation of Office by Directors
88. Without prejudice to the provisions for retirement by rotation or
otherwise contained in these articles, the office of a director shall be
vacated if:-
(a) he resigns his office by notice in writing, such notice in writing
to include the use of electronic communications subject to such
terms and conditions as the board may decide, received at the office
or tendered at a meeting of the board, or
(b) he is or has been suffering from mental ill health or becomes a
patient for any purpose of any statute relating to mental health and
the board resolves that his office is vacated, or
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(c) he is absent without the permission of the board from meetings of
the board (whether or not an alternate director appointed by him
attends) for twelve consecutive months and the board resolves that
his office is vacated, or
(d) he becomes bankrupt or compounds with his creditors generally, or
(e) he is prohibited by law from being a director, or
(f) he ceases to be a director by virtue of the Companies Acts or is
removed from office pursuant to these articles.
If the office of a director is vacated for any reason, he shall cease to
be a member of any committee or sub-committee of the board.
Alternate Directors
89. (A) Each director may appoint any person to be his alternate and may at
his discretion remove an alternate director so appointed. If the
alternate director is not already a director, the appointment,
unless previously approved by the board, shall have effect only upon
and subject to its being so approved. Any appointment or removal of
an alternate director shall be effected by notice in writing signed
by the appointor and delivered to the office or tendered at a
meeting of the board, or in any other manner approved by the board.
If his appointor so requests, an alternate director shall be
entitled to receive notice of all meetings of the board or of
committees of the board of which his appointor is a member. He shall
also be entitled to attend and vote as a director at any such
meeting at which the director appointing him is not personally
present and at such meeting to exercise and discharge all the
functions, powers and duties of his appointor as a director and for
the purposes of the proceedings at such meeting the provisions of
these articles shall apply as if he were a director.
(B) Every person acting as an alternate director shall (except as
regards power to appoint an alternate and remuneration) be subject
in all respects to the provisions of these articles relating to
directors and shall alone be responsible to the company for his acts
and defaults and shall not be deemed to be the agent of or for the
director appointing him. An alternate director may be paid expenses
and shall be entitled to be indemnified by the company to the same
extent as if he were a
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director but shall not be entitled to receive from the company any
fee in his capacity as an alternate director.
(C) Every person acting as an alternate director shall have one vote for
each director for whom he acts as alternate, in addition to his own
vote if he is also a director. Execution by an alternate director of
any resolution in writing of the board or a committee of the board
shall, unless the notice of his appointment provides to the
contrary, be as effective as execution by his appointor.
(D) An alternate director shall automatically cease to be an alternate
director if his appointor ceases for any reason to be a director
except that, if at any meeting any director retires by rotation or
otherwise but is reappointed or deemed to be reappointed at the same
meeting, any appointment made by him pursuant to this article which
was in force immediately before his retirement shall remain in force
as though he had not retired.
(E) In this article references to in writing include the use of
electronic communications subject to such terms and conditions as
the board may decide.
Executive Directors
90. The board or any committee authorised by the board may from time to time
appoint one or more directors to hold any employment or executive office
with the company for such period (subject to the provisions of the
Companies Acts) and upon such other terms as the board or any committee
authorised by the board may in its discretion decide and may revoke or
terminate any appointment so made. Any revocation or termination of the
appointment shall be without prejudice to any claim for damages that the
director may have against the company or the company may have against the
director for any breach of any contract of service between him and the
company which may be involved in the revocation or termination. A director
so appointed shall receive such remuneration (whether by way of salary,
commission, participation in profits or otherwise) as the board or any
committee authorised by the board may decide, and either in addition to or
in lieu of his remuneration as a director.
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Additional Remuneration Expenses and Pensions
Additional Remuneration
91. Any director who performs services which in the opinion of the board or
any committee authorised by the board go beyond the ordinary duties of a
director may be paid such extra remuneration (whether by way of salary,
commission, participation in profits or otherwise) as the board or any
committee authorised by the board may in its discretion decide in addition
to any remuneration provided for by or pursuant to any other article.
Expenses
92. Each director may be paid his reasonable travelling, hotel and incidental
expenses of attending and returning from meetings of the board or
committees of the board or general meetings of the company or any other
meeting which as a director he is entitled to attend and shall be paid all
other costs and expenses properly and reasonably incurred by him in the
conduct of the company's business or in the discharge of his duties as a
director.
Pensions and Gratuities for Directors
93. The board or any committee authorised by the board may exercise all the
powers of the company to provide benefits, either by the payment of
gratuities or pensions or by insurance or in any other manner whether
similar to the foregoing or not, for any director or former director or
the relations, connections or dependants of any director or former
director provided that no benefits (except such as may be provided for by
any other article) may be granted to or in respect of a director or former
director who has not been employed by, or held an executive office or
place of profit under, the company or any body corporate which is or has
been its subsidiary or any predecessor in business of the company or any
such body corporate without the approval of an ordinary resolution of the
company. No director or former director shall be accountable to the
company or the members for any benefit provided pursuant to this article
and the receipt of any such benefit shall not disqualify any person from
being or becoming a director of the company.
Directors' Interests
Permitted Interests and Voting
94. (A) Subject to the provisions of the Companies Acts and of paragraph
(J)of this article, no director or proposed or
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intending director shall be disqualified by his office from
contracting with the company, either with regard to his tenure of
any office or place of profit or as vendor, purchaser or in any
other manner whatever, nor shall any contract in which any director
is in any way interested be liable to be avoided, nor shall any
director who is so interested be liable to account to the company or
the members for any remuneration, profit or other benefit realised
by the contract by reason of the director holding that office or of
the fiduciary relationship thereby established.
(B) A director may hold any other office or place of profit with the
company (except that of auditor) in conjunction with his office of
director for such period (subject to the provisions of the Companies
Acts) and upon such other terms as the board may decide, and may be
paid such extra remuneration for so doing (whether by way of salary,
commission, participation in profits or otherwise) as the board or
any committee authorised by the board may decide, and either in
addition to or in lieu of any remuneration provided for by or
pursuant to any other article.
(C) A director of the company may be or become a director or other
officer of, or otherwise interested in, any company promoted by the
company or in which the company may be interested or as regards
which it has any power of appointment, and shall not be liable to
account to the company or the members for any remuneration, profit
or other benefit received by him as a director or officer of or from
his interest in the other company. The board may also cause any
voting power conferred by the shares in any other company held or
owned by the company or any power of appointment to be exercised in
such manner in all respects as it thinks fit, including the exercise
of the voting power or power of appointment in favour of the
appointment of the directors or any of them as directors or officers
of the other company, or in favour of the payment of remuneration to
the directors or officers of the other company.
(D) A director may act by himself or his firm in a professional capacity
for the company (otherwise than as auditor) and he or his firm shall
be entitled to remuneration for professional services as if he were
not a director.
(E) A director shall not vote on or be counted in the quorum in relation
to any resolution of the board concerning his own appointment, or
the settlement or variation of the terms or the termination of his
own appointment, as the holder of any office
39
or place of profit with the company or any other company in which
the company is interested but, where proposals are under
consideration concerning the appointment, or the settlement or
variation of the terms or the termination of the appointment, of two
or more directors to offices or places of profit with the company or
any other company in which the company is interested, a separate
resolution may be put in relation to each director and in that case
each of the directors concerned shall be entitled to vote and be
counted in the quorum in respect of each resolution unless it
concerns his own appointment or the settlement or variation of the
terms or the termination of his own appointment or the appointment
of another director to an office or place of profit with a company
in which the company is interested and the director seeking to vote
or be counted in the quorum owns one per cent. or more of it.
(F) Save as otherwise provided by these articles, a director shall not
vote on, or be counted in the quorum in relation to, any resolution
of the board in respect of any contract in which he has an interest
which (taken together with any interest of any person connected with
him) is to his knowledge a material interest and, if he shall do so,
his vote shall not be counted, but this prohibition shall not apply
to any resolution where that material interest arises only from one
or more of the following matters:-
(i) the giving to him of any guarantee, indemnity or security in
respect of money lent or obligations undertaken by him or by
any other person at the request of or for the benefit of the
company or any of its subsidiary undertakings,
(ii) the giving to a third party of any guarantee, indemnity or
security in respect of a debt or obligation of the company or
any of its subsidiary undertakings for which he himself has
assumed responsibility in whole or in part under a guarantee
or indemnity or by the giving of security,
(iii) where the company or any of its subsidiary undertakings is
offering securities in which offer the director is or may be
entitled to participate as a holder of securities or in the
underwriting or sub-underwriting of which the director is to
participate,
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(iv) any contract in which he is interested by virtue of his
interest in shares or debentures or other securities of the
company or by reason of any other interest in or through the
company,
(v) any contract concerning any other company (not being a company
in which the director owns one per cent. or more) in which he
is interested directly or indirectly whether as an officer,
shareholder, creditor or otherwise howsoever,
(vi) any contract concerning the adoption, modification or
operation of a pension fund or retirement death or disability
benefits scheme which relates both to directors and employees
of the company or of any of its subsidiary undertakings and
does not provide in respect of any director as such any
privilege or advantage not accorded to the employees to which
the fund or scheme relates,
(vii) any contract for the benefit of employees of the company or of
any of its subsidiary undertakings under which he benefits in
a similar manner to the employees and which does not accord to
any director as such any privilege or advantage not accorded
to the employees to whom the contract relates, and
(viii)any contract for the purchase or maintenance for any director
or directors of insurance against any liability.
(G) A company shall be deemed to be one in which a director owns one per
cent. or more if and so long as (but only if and so long as) he,
taken together with any person connected with him, is to his
knowledge (either directly or indirectly) the holder of or
beneficially interested in one per cent. or more of any class of the
equity share capital of that company or of the voting rights
available to members of that company. For the purpose of this
paragraph of this article there shall be disregarded any shares held
by the director or any such person as bare or custodian trustee and
in which he has no beneficial interest, any shares comprised in a
trust in which his, or any such person's, interest is in reversion
or remainder if and so long as some other person is entitled to
receive the income of the trust and any shares comprised in an
authorised unit trust scheme in which he, or any such person, is
interested only as a unit holder.
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(H) Where a company in which a director owns one per cent. or more is
materially interested in a contract, he also shall be deemed
materially interested in that contract.
(I) If any question shall arise at any meeting of the board as to the
materiality of the interest of a director (other than the chairman
of the meeting) or as to the entitlement of any director (other than
the chairman of the meeting) to vote or be counted in the quorum and
the question is not resolved by his voluntarily agreeing to abstain
from voting or not to be counted in the quorum, the question shall
be referred to the chairman of the meeting and his ruling in
relation to the director concerned shall be conclusive except in a
case where the nature or extent of his interest (so far as it is
known to him) has not been fairly disclosed to the board. If any
question shall arise in respect of the chairman of the meeting, the
question shall be decided by a resolution of the board (for which
purpose the chairman shall be counted in the quorum but shall not
vote on the matter) and the resolution shall be conclusive except in
a case where the nature or extent of the interest of the chairman
(so far as it is known to him) has not been fairly disclosed to the
board.
(J) A director who to his knowledge is in any way, whether directly or
indirectly, interested in a contract with the company shall declare
the nature of his interest at the meeting of the board at which the
question of entering into the contract is first taken into
consideration, if he knows his interest then exists, or in any other
case at the first meeting of the board after he knows that he is or
has become so interested. For the purposes of this article, a
general notice to the board by a director to the effect that (a) he
is a member of a specified company or firm and is to be regarded as
interested in any contract which may after the date of the notice be
made with that company or firm or (b) he is to be regarded as
interested in any contract which may after the date of the notice be
made with a specified person who is connected with him, shall be
deemed to be a sufficient declaration of interest under this article
in relation to any such contract; provided that no such notice shall
be effective unless either it is given at a meeting of the board or
the director takes reasonable steps to secure that it is brought up
and read at the next board meeting after it is given.
(K) References in this article to a contract include references to any
proposed contract and to any transaction or arrangement whether or
not constituting a contract.
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Powers and Duties of the Board
General Powers of Company Vested in Board
95. Subject to the provisions of the Companies Acts, the memorandum of
association of the company and these articles and to any directions given
by the company in general meeting by special resolution, the business of
the company shall be managed by the board which may exercise all the
powers of the company whether relating to the management of the business
of the company or not. No alteration of the memorandum of association or
these articles and no special resolution shall invalidate any prior act of
the board which would have been valid if that alteration had not been made
or that resolution had not been passed. The powers given by this article
shall not be limited by any special power given to the board by any other
article.
Agents
96. The board may, by power of attorney or otherwise, appoint any person to be
the agent of the company upon such terms (including terms as to
remuneration) as it may decide and may delegate to any person so appointed
any of its powers, authorities and discretions (with power to
sub-delegate). The board may remove any person appointed under this
article and may revoke or vary the delegation but no person dealing in
good faith and without notice of the revocation or variation shall be
affected by it. The power to delegate contained in this article shall be
effective in relation to the powers, authorities and discretions of the
board generally and shall not be limited by the fact that in certain
articles, but not in others, express reference is made to particular
powers, authorities or discretions being exercised by the board or by a
committee authorised by the board.
Delegation to Individual Directors
97. The board may entrust to and confer upon any director any of its powers,
authorities and discretions (with power to sub-delegate) upon such terms
and conditions and with such restrictions as it thinks fit, and either
collaterally with, or to the exclusion of, its own powers, authorities and
discretions and may from time to time revoke or vary all or any of them
but no person dealing in good faith and without notice of the revocation
or variation shall be affected by it. The power to delegate contained in
this article shall be effective in relation to the powers, authorities and
discretions of the board generally and shall not be limited by the fact
that in certain articles, but not in others, express reference is made to
43
particular powers, authorities or discretions being exercised by the board
or by a committee authorised by the board.
Official Seals
98. The company may exercise all the powers conferred by the Companies Acts
with regard to having official seals, and those powers shall be vested in
the board.
Registers
99. Subject to the provisions of the Companies Acts, the company may keep an
overseas or local or other register in any place, and the board may make
and vary such regulations as it may think fit respecting the keeping of
the register provided that if there are in issue any uncertificated shares
such regulations shall not be inconsistent with the Uncertificated
Securities Regulations.
Provision for Employees
100. The board may exercise any power conferred by the Companies Acts to make
provision for the benefit of persons employed or formerly employed by the
company or any of its subsidiaries in connection with the cessation or the
transfer to any person of the whole or part of the undertaking of the
company or that subsidiary.
Proceedings of the Board
Board Meetings
101. The board may meet for the despatch of business, adjourn and otherwise
regulate its meetings as it thinks fit. A director at any time may, and
the secretary on the requisition of a director at any time shall, summon a
board meeting.
Notice of Board Meetings
102. Notice of a board meeting shall be deemed to be properly given to a
director if it is given to him personally or by word of mouth or sent in
writing to him at his last known address or any other address given by him
to the company for this purpose. A director absent or intending to be
absent from the United Kingdom may request the board that notices of board
meetings shall during his absence be sent in writing to him at an address
given by him to the company for this purpose, but such notices need not be
given any earlier than notices given to directors not so absent and if no
request is made to the board it shall not be necessary to give notice of a
board meeting to
44
any director who is for the time being absent from the United Kingdom. A
director may waive notice of any meeting either prospectively or
retrospectively. In this article reference to any notice being in writing
includes notice given by use of electronic communications, subject to such
terms and conditions as the board may decide.
Quorum
103. The quorum necessary for the transaction of the business of the board may
be fixed by the board and, unless so fixed at any other number, shall be
four. Subject to the provisions of these articles, any director who ceases
to be a director at a board meeting may continue to be present and to act
as a director and be counted in the quorum until the termination of the
board meeting if no other director objects and if otherwise a quorum of
directors would not be present.
Directors below Minimum through Vacancies
104. The continuing directors or a sole continuing director may act
notwithstanding any vacancy in their number but, if and so long as the
number of directors is reduced below the minimum number fixed by or in
accordance with these articles or is below the number fixed by or in
accordance with these articles as the quorum or there is only one
continuing director, the continuing directors or director may act for the
purpose of filling vacancies or of summoning general meetings of the
company but not for any other purpose.
Appointment of Chairman
105. The board may appoint a director to be the chairman or the deputy chairman
of the board, and may at any time remove him from that office. Unless he
is unwilling to do so, the chairman or failing him the deputy chairman
shall act as chairman at every meeting of the board. But if no chairman or
deputy chairman is appointed, or if at any meeting neither the chairman
nor any deputy chairman is present within five minutes after the time
appointed for holding the meeting and willing to act, the directors
present may choose one of their number to be chairman of the meeting.
Competence of Meetings
106. A meeting of the board at which a quorum is present shall be competent to
exercise all the powers, authorities and discretions for the time being
vested in or exercisable by the board.
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Voting
107. Questions arising at any meeting shall be determined by a majority of
votes. In the case of an equality of votes the chairman of the meeting
shall have a second or casting vote.
Delegation to Committees
108. (A) The board may delegate any of its powers, authorities and
discretions (with power to sub-delegate) to any committee,
consisting of such person or persons (whether a member or members of
its body or not) as it thinks fit. Any committee so formed may
exercise its power to sub-delegate by sub-delegating to any person
or persons (whether or not a member or members of the board or of
the committee).
(B) Any committee so formed shall, in the exercise of the powers,
authorities and discretions so delegated, conform to any regulations
which may be imposed on it by the board. The meetings and
proceedings of any committee consisting of two or more members shall
be governed by the provisions contained in these articles for
regulating the meetings and proceedings of the board so far as the
same are applicable and are not superseded by any regulations
imposed by the board.
(C) The power to delegate contained in this article shall be effective
in relation to the powers, authorities and discretions of the board
generally and shall not be limited by the fact that in certain
articles, but not in others, express reference is made to particular
powers, authorities or discretions being exercised by the board or
by a committee authorised by the board.
Participation in Meetings by Telephone
109. All or any of the members of the board or any committee of the board may
participate in a meeting of the board or that committee by means of a
conference telephone or any communication equipment which allows all
persons participating in the meeting to speak to and hear each other. A
person so participating shall be deemed to be present in person at the
meeting and shall be entitled to vote or be counted in a quorum
accordingly. Such a meeting shall be deemed to take place where the
largest group of those participating is assembled, or, if there is no such
group, where the chairman of the meeting then is.
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Resolution in Writing
110. A resolution in writing signed by all the directors for the time being
entitled to receive notice of a meeting of the board (if that number is
sufficient to constitute a quorum) or by all the members of a committee
for the time being shall be as valid and effectual as a resolution passed
at a meeting of the board or, as the case may be, of the committee
properly called and constituted. The resolution may be contained in one
document or in several documents in like form each signed by one or more
of the directors or members of the committee concerned. In this article
reference to a resolution being in writing includes the results of the use
of electronic communications, subject to such terms and conditions as the
board may decide.
Validity of Acts of Board or Committee
111. All acts done by the board or by any committee or by any person acting as
a director or member of a committee shall, notwithstanding that it is
afterwards discovered that there was some defect in the appointment of any
member of the board or committee or person so acting or that they or any
of them were disqualified or had vacated office or were not entitled to
vote, be as valid as if each such member or person had been properly
appointed and was qualified and had continued to be a director or member
of the committee and had been entitled to vote.
Secretary
Appointment and Removal of the Company Secretary
112. Subject to the provisions of the Companies Acts, the secretary shall be
appointed by the board for such term and upon such conditions as the board
may think fit; and any secretary so appointed may be removed by the board.
The company secretary shall receive such remuneration as the board or any
committee authorised by the board shall decide.
Seals
Use of Seals
113. The board shall provide
(A) for the custody of every seal of the company. A seal shall only be
used by the authority of the board or of a committee of the board
authorised by the board in that behalf. Subject as
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otherwise provided in these articles, any instrument to which the
common seal is applied shall be signed by at least one director and
the secretary, or by at least two directors or by such other person
or persons as the board may approve.
(B) Any instrument to which an official seal is applied need not, unless
the board for the time being otherwise decides or the law otherwise
requires, be signed by any person.
Dividends and Other Payments
Declaration of Dividends by Company
114. Subject to the provisions of the Companies Acts, the company may by
ordinary resolution from time to time declare dividends in accordance with
the respective rights of the members, but no dividend shall exceed the
amount recommended by the board.
Payment of Interim and Fixed Dividends by Board
115. Subject to the provisions of the Companies Acts, the board may pay such
interim dividends as appear to the board to be justified by the financial
position of the company and may also pay any dividend payable at a fixed
rate at intervals settled by the board whenever the financial position of
the company, in the opinion of the board, justifies its payment. If the
board acts in good faith, it shall not incur any liability to the holders
of shares conferring preferred rights for any loss they may suffer in
consequence of the payment of an interim or fixed dividend on any shares
having non-preferred or deferred rights.
Calculation and Currency of Dividends
116. Except in so far as the rights attaching to, or the terms of issue of, any
share otherwise provide:-
(a) all dividends shall be declared and paid according to the amounts
paid up on the shares in respect of which the dividend is paid, but
no amount paid up on a share in advance of calls shall be treated
for the purposes of this article as paid up on the share,
(b) all dividends shall be apportioned and paid pro rata according to
the amounts paid up on the shares during any portion or portions of
the period in respect of which the dividend is paid, and
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(c) dividends may be declared or paid in any currency.
The board may agree with any member that dividends which may at any time
or from time to time be declared or become due on his shares in one
currency shall be paid or satisfied in another, and may agree the basis of
conversion to be applied and how and when the amount to be paid in the
other currency shall be calculated and paid and for the company or any
other person to bear any costs involved.
Amounts Due on Shares may be Deducted from Dividends
117. The board may deduct from any dividend or other moneys payable to a
memberby the company on or in respect of any shares all sums of money (if
any) presently payable by him to the company on account of calls or
otherwise in respect of shares of the company.
No Interest on Dividends
118. No dividend or other moneys payable by the company on or in respect of any
share shall bear interest against the company.
Payment Procedure
119. Any dividend or other sum payable by the company in respect of a share may
be paid by cheque, warrant or similar financial instrument sent by post
addressed to the holder at his registered address or, in the case of joint
holders, addressed to the holder whose name stands first in the register
in respect of the shares at his address as appearing in the register or
addressed to such person and at such address as the holder or joint
holders may in writing direct. Every cheque, warrant or similar financial
instrument shall, unless the holder or joint holders otherwise direct, be
made payable to the holder or, in the case of joint holders, to the holder
whose name stands first on the register in respect of the shares, and
shall be sent at his or their risk and payment of the cheque or warrant by
the bank on which it is drawn shall constitute a good discharge to the
company. In addition, any such dividend or other sum may be paid by any
bank or other funds transfer system or such other means including, in
respect of uncertificated shares, by means of the facilities and
requirements of a relevant system and to or through such person as the
holder or joint holders may in writing direct and the company may agree
to, and the company shall have no responsibility for any sums lost or
delayed in the course of any such transfer or where it has acted on any
such directions. Any one of two or more joint holders may give effectual
receipts for any dividends or other moneys payable or property
distributable in respect of the shares held by them. Where a person is
entitled by
49
transmission to a share, any dividend or other sum payable by the company
in respect of the share may be paid as if he were a holder of the share
and his address noted in the register were his registered address. In this
article references to directions being in writing include the results of
the use of electronic communications, subject to such terms and conditions
as the board may decide.
Uncashed Dividends
120. The company may cease to send any cheque, warrant or similar financial
instrument through the post or employ any other means of payment,
including payment by means of a relevant system, for any dividend payable
on any shares in the company which is normally paid in that manner on
those shares if in respect of at least two consecutive dividends payable
on those shares the cheques, warrants or similar financial instruments
have been returned undelivered or remain uncashed or that means of payment
has failed. In addition, the company may cease to send any cheque, warrant
or similar financial instrument through the post or may cease to apply any
other means of payment if, in respect of one dividend payable on those
shares, the cheque, warrant or similar financial instrument has been
returned undelivered or remains uncashed or that means of payment has
failed and reasonable enquiries have failed to establish any new address
of the registered holder. Subject to the provisions of these articles, the
company may recommence sending cheques, warrants or similar financial
instruments or employing such means in respect of dividends payable on
those shares if the holder or person entitled by transmission requests
such recommencement in writing.
Forfeiture of Unclaimed Dividends
121. Any dividend unclaimed after a period of twelve years from the date when
it was declared or became due for payment shall be forfeited and shall
revert to the company and the payment by the board of any unclaimed
dividend or other sum payable on or in respect of a share into a separate
account shall not constitute the company a trustee in respect of it.
Dividends Not in Cash
122. Any general meeting declaring a dividend may, upon the recommendation of
the board, by ordinary resolution direct that it shall be satisfied wholly
or partly by the distribution of assets, and in particular of paid up
shares or debentures of any other company, and where any difficulty arises
in regard to the distribution the board may settle it as it thinks
expedient, and in particular may issue fractional certificates or
authorise any person to sell and transfer
50
any fractions or may ignore fractions altogether, and may fix the value
for distribution purposes of any assets to be distributed and may
determine that cash shall be paid to any members upon the footing of the
value so fixed in order to secure equality of distribution and may vest
any assets to be distributed in trustees as may seem expedient to the
board.
Scrip Dividends
123. The board may, if authorised by an ordinary resolution of the company,
offer any holders of ordinary shares the right to elect to receive
ordinary shares, credited as fully paid, instead of cash in respect of the
whole (or some part, to be determined by the board) of any dividend
specified by the ordinary resolution. The following provisions shall
apply:
(a) An ordinary resolution may specify a particular dividend (whether or
not already declared) or may specify all or any dividends declared
within a specified period, but such period may not end later than
the fifth anniversary of the date of the meeting at which the
ordinary resolution is passed.
(b) The entitlement of each holder of ordinary shares to new ordinary
shares shall be such that the relevant value of the entitlement
shall be as nearly as possible equal to (but not greater than) the
cash amount (disregarding any tax credit) of the dividend that such
holder elects to forego. For this purpose "relevant value" shall be
calculated by reference to the average of the market value (as
defined by the Listing Rules) of the company's ordinary shares on
the day on which the ordinary shares are first quoted "ex" the
relevant dividend and the four subsequent dealing days, or in such
other manner as may be determined by or in accordance with the
ordinary resolution. A certificate or report by the auditors as to
the amount of the relevant value in respect of any dividend shall be
conclusive evidence of that amount and in giving such a certificate
or report the auditors may rely on advice or information from
brokers or other sources of information as they think fit.
(c) No fraction of any ordinary share shall be allotted. The board may
make such provisions as they think fit for any fractional
entitlements including provisions whereby, in whole or in part, the
benefit thereof accrues to the company and/or under which fractional
entitlements are accrued and/or retained and in each case
accumulated on behalf of any member and such accruals or retentions
are applied to the allotment by way of bonus to or
51
cash subscription on behalf of such member of fully paid ordinary
shares and/or provisions whereby cash payments may be made to
members in respect of their fractional entitlements.
(d) On or as soon as practicable after announcing that it is to declare
or recommend any dividend, the board, if it intends to offer an
election in respect of that dividend, shall also announce that
intention, and shall, after determining the basis of allotment, if
it decides to proceed with the offer, notify the holders of ordinary
shares in writing of the right of election offered to them, and
specify the procedure to be followed which, for the avoidance of
doubt, may include an election by means of a relevant system and the
place at which, and the latest time by which elections must be
lodged in order for elections to be effective.
(e) The board shall not proceed with any election unless the company has
sufficient unissued shares authorised for issue and sufficient
reserves or funds that may be capitalised to give effect to it after
the basis of allotment is determined.
(f) The board may exclude from any offer any holders of ordinary shares
where the board believes that such exclusion is necessary or
expedient in relation to legal or practical problems under the laws
of, or the requirements of any recognised regulatory body or any
stock exchange in, any territory, or the board believes that for any
other reason the offer should not be made to them.
(g) The dividend (or that part of the dividend in respect of which a
right of election has been offered) shall not be payable on ordinary
shares in respect of which an election has been made (for the
purposes of this article the "elected ordinary shares") and instead
additional ordinary shares shall be allotted to the holders of the
elected ordinary shares on the basis of allotment calculated as
stated. For such purpose the board shall capitalise, out of any
amount for the time being standing to the credit of any reserve or
fund (including the profit and loss account) whether or not the same
is available for distribution as the board may determine, a sum
equal to the aggregate nominal amount of the additional ordinary
shares to be allotted on that basis and apply it in paying up in
full the appropriate number of unissued ordinary shares for
allotment and distribution to the holders of the elected ordinary
shares on that basis.
52
(h) Unless the board otherwise determines, or unless the Uncertificated
Securities Regulations and/or the rules of the relevant system
concerned otherwise require, the new ordinary share or shares which
a member has elected to receive instead of cash in respect of the
whole (or some part) of the specified dividend declared in respect
of his elected ordinary shares shall be or shall be issued in
uncertificated form (in respect of the member's elected ordinary
shares which were in uncertificated form on the date of the member's
election) and in certificated form (in respect of the member's
elected ordinary shares which were in certificated form on the date
of the member's election).
(i) The additional ordinary shares when allotted shall rank pari passu
in all respects with the fully-paid ordinary shares then in issue
except that they will not be entitled to participation in the
relevant dividend.
(j) The board may also from time to time establish or vary a procedure
for election mandates, which, for the avoidance of doubt, may
include an election by means of a relevant system, under which a
holder of ordinary shares may elect in respect of future rights of
election offered to that holder under this article until the
election mandate is revoked in accordance with the procedure.
Capitalisation of Reserves
Power to Capitalise Reserves and Funds
124. The company may, upon the recommendation of the board, at any time and
from time to time pass an ordinary resolution to the effect that it is
desirable to capitalise all or any part of any amount for the time being
standing to the credit of any reserve or fund (including the profit and
loss account) whether or not the same is available for distribution and
accordingly that the amount to be capitalised be set free for distribution
among the members or any class of members who would be entitled to it if
it were distributed by way of dividend and in the same proportions, on the
footing that it is applied either in or towards paying up the amounts for
the time being unpaid on any shares in the company held by those members
respectively or in paying up in
53
full unissued shares debentures or other obligations of the company to be
allotted and distributed credited as fully paid up among those members, or
partly in one way and partly in the other, but so that, for the purposes
of this article, a share premium account and a capital redemption reserve,
and any reserve or fund representing unrealised profits, may be applied
only in paying up in full unissued shares of the company. The board may
authorise any person to enter into an agreement with the company on behalf
of the persons entitled to participate in the distribution providing for
the allotment to them respectively of any shares, debentures or other
obligations of the company to which they are entitled on the
capitalisation and the agreement shall be binding on those persons.
Settlement of Difficulties in Distribution
125. Where any difficulty arises in regard to any distribution of any
capitalised reserve or fund the board may settle the matter as it thinks
expedient and in particular may issue fractional certificates or authorise
any person to sell and transfer any fractions or may resolve that the
distribution should be as nearly as may be practicable in the correct
proportion but not exactly so or may ignore fractions altogether, and may
determine that cash payments shall be made to any members in order to
adjust the rights of all parties, as may seem expedient to the board.
Record Dates
Power to Choose Any Record Date
126. Notwithstanding any other provision of these articles, the company or the
board may fix any date as the record date for any dividend, distribution,
allotment or issue and such record date may be on or at any time before or
after any date on which the dividend, distribution, allotment or issue is
declared, paid or made. The power to fix the record date shall include the
power to fix a time on the chosen date.
Accounting Records and Summary Financial Statements
Records to be Kept
127. The board shall cause to be kept accounting records sufficient to show and
explain the company's transactions, and such as to disclose with
reasonable accuracy at any time the financial position of the company at
that time, and which accord with the Companies Acts.
Inspection of Records
128. No member in his capacity as such shall have any right of inspecting any
accounting record or book or document of the company except as conferred
by law or authorised by the board or by ordinary resolution of the
company.
54
Summary Financial Statements
129. The company may send summary financial statements to members of the
company instead of copies of its full accounts and reports. In this
article reference to sending includes use of electronic communications and
publication on a website in accordance with the Companies Acts.
Service of Notices and Documents
Service of Notices
130. Any notice or document (including a share certificate) may be served on or
delivered to any member by the company either personally or by sending it
through the post addressed to the member at his registered address or by
leaving it at that address addressed to the member or by means of any
relevant system or by any other means authorised in writing by the member
concerned. In the case of joint holders of a share, service or delivery of
any notice or document on or to one of the joint holders shall for all
purposes be deemed a sufficient service on or delivery to all the joint
holders. Where appropriate the company can also send any notice or other
document by sending it using electronic communications to an address
notified by the member concerned to the company for that purpose or by
publication on a website in accordance with the Companies Acts. In this
article reference to authorisation in writing includes the results of the
use of electronic communications, subject to such terms and conditions as
the board may decide.
Record Date for Service
131. Any notice or document may be served or delivered by the company by
reference to the register as it stands at any time not more than 15 days
before the date of service or delivery. No change in the register after
that time shall invalidate that service or delivery. Where any notice or
document is served on or delivered to any person in respect of a share in
accordance with these articles, no person deriving any title or interest
in that share shall be entitled to any further service or delivery of that
notice or document.
Members Resident Abroad
132. Any member whose registered address is not within the United Kingdom and
who gives to the company a postal address within the United Kingdom at
which notices or documents may be served upon him shall be entitled to
have notices or documents served upon him at that address. Any member
whose registered address is not within the United
55
Kingdom and who gives to the company an address for the purposes of
electronic communications may, at the absolute discretion of the board,
have notices sent to him at that address. Otherwise, a member whose
registered address is not within the United Kingdom shall not be entitled
to receive any notice or document from the company.
Service of Notice on Person Entitled by Transmission
133. Where a person is entitled by transmission to a share, any notice or other
document shall be served upon or delivered to him by post to the
registered address or by the use of electronic communications to an
address provided by the member, as if he were the holder of that share and
his address noted in the register were his registered address or his
address for electronic communications. Otherwise, any notice or other
document served on or delivered to any member pursuant to these articles
shall, notwithstanding that the member is then dead or bankrupt or that
any other event giving rise to the transmission of the share by operation
of law has occurred and whether or not the company has notice of the
death, bankruptcy or other event, be deemed to have been properly served
or delivered in respect of any share registered in the name of that member
as sole or joint holder.
When Notice Deemed Served
134. (A) If a notice or document is sent by the company by post, it is
treated as being received twenty-four hours after it was posted. In
proving that a notice or a document was received, it is sufficient
to show that the envelope was properly addressed and put into the
postal system with postage paid.
(B) If a notice or document is left by the company at a member's
registered address or at a postal address notified to the company in
accordance with these articles by a person who is entitled by
transmission to a share, it is treated as being received on the day
it was left.
(C) If a notice or document is sent by the company using electronic
communications it is treated as being received on the day after it
was sent. Proof that a notice or document contained in an electronic
communication was sent in accordance with guidance issued from time
to time by the Institute of Chartered Secretaries and Administrators
shall be conclusive evidence that the notice was given.
(D) If a notice or document is sent by the company by any other means
authorised by a member, it is treated as being received
56
when the company has done what it is authorised to do by that
member.
Notice When Post Not Available
135. If at any time by reason of the suspension or curtailment of postal
services within the United Kingdom or of the relevant electronic
communication system the company is unable effectively to convene a
general meeting by notice sent through the post or by electronic
communications, notice of the general meeting may be given to members
affected by the suspension or curtailment by a notice advertised in at
least one newspaper with a national circulation and in that event the
notice shall be deemed to have been served on all members or all affected
members, as the case may be, and persons entitled by transmission, who are
entitled to have notice of the meeting served upon them, on the day when
the advertisement has appeared in at least one such paper. If at least six
clear days prior to the meeting the sending of notices by post or
electronic communications has again become generally possible, the company
shall send confirmatory copies of the notice by post or by electronic
communications to the persons entitled to receive them.
Destruction of Documents
Presumptions Where Documents Destroyed
136. If the company destroys:
(a) any share certificate which has been cancelled at any time after a
period of one year has elapsed from the date of cancellation; or
(b) any instruction concerning the payment of dividends or other moneys
in respect of any share or any notification of change of name or
address at any time after a period of two years has elapsed from the
date the instruction or notification was recorded by the company; or
(c) any instrument of transfer of shares which has been registered at
any time after a period of six years has elapsed from the date of
registration; or
(d) any other document on the basis of which any entry is made in the
register at any time after a period of six years has elapsed from
the date the entry was first made in the register in respect of it
57
and the company destroys the document in good faith and without
express notice that its preservation was relevant to a claim, it
shall be presumed irrebuttably in favour of the company that every
share certificate so destroyed was a valid certificate and was
properly cancelled, that every instrument of transfer so destroyed
was a valid and effective instrument of transfer and was properly
registered and that every other document so destroyed was a valid
and effective document and that any particulars of it which are
recorded in the books or records of the company were correctly
recorded. Nothing contained in this article shall be construed as
imposing upon the company any liability by reason only of the
destruction of any document of the kind mentioned above before the
relevant period mentioned in this article has elapsed or of the fact
that any other condition precedent to its destruction mentioned
above has not been fulfilled. References in this article to the
destruction of any document include references to its disposal in
any manner.
Winding Up
Distribution of Assets Otherwise Than in Cash
137. If the company commences liquidation, the liquidator may, with the
sanction of a special resolution of the company and any other sanction
required by the Companies Acts,
(a) divide among the members in kind the whole or any part of the assets
of the company (whether they shall consist of property of the same
kind or not) and, for that purpose, set such values as he deems fair
upon any property to be divided and determine how the division shall
be carried out as between the members or different classes of
members, or
(b) vest the whole or any part of the assets in trustees upon such
trusts for the benefit of the contributories as the liquidator, with
the like sanction, shall think fit
but no member shall be compelled to accept any shares or other assets upon
which there is any liability.
Indemnity
Indemnity of Officers
138. Subject to the provisions of the Companies Acts, the company may indemnify
any director or other officer against any liability and may purchase and
maintain for any director or other officer or auditor insurance against
any liability. Subject to those provisions, but
58
without prejudice to any indemnity to which the person concerned may
otherwise be entitled, every director or other officer of the company
shall be indemnified, and if the board so determines an auditor may be
indemnified, out of the assets of the company against any liability
incurred by him as a director or other officer of the company, or as
auditor, in defending any proceedings (whether civil or criminal) in which
judgment is given in his favour or he is acquitted or in connection with
any application under the Companies Acts in which relief is granted to him
by the court.
CONTENTS
Page
Part 1 (Particular Provisions) 1
1. (A) Authorised Share Capital 1
(B) Borrowing Powers 1
(C) Votes of Members 1
(D) Suspension of Rights Where Non-Disclosure of Interest 1
(E) Number of Directors 4
(F) Directors' Fees 4
(G) Vacation of Office by Directors 4
(H) Uncertificated Shares 4
(I) Separate General Meetings 5
Part 2 (General Provisions)
Interpretation 6
2. Exclusion of Table A 6
3. Definitions 6
4. Form of Resolution 8
Share Capital 8
5. Rights Attached to Shares 8
6. Redeemable Shares 9
7. Purchase of Own Shares 9
8. Variation of Rights 9
9. Pari Passu Issues 10
10. Unissued Shares 10
11. Payment of Commission 10
12. Trusts Not Recognised 10
Certificates 10
13. Right to Share Certificates 10
14. Replacement of Share Certificates 11
15. Execution of Share Certificates 11
Lien 11
16. Company's Lien on Shares Not Fully Paid 11
17. Enforcing Lien by Sale 11
18. Application of Proceeds of Sale 12
Calls on Shares 12
19. Calls 12
20. Payment on Calls 12
21. Liability of Joint Holders 12
22. Interest Due on Non-Payment 12
23. Sums Due on Allotment Treated as Calls 12
24. Power to Differentiate 13
25. Payment of Calls in Advance 13
Forfeiture of Shares 13
26. Notice if Call or Instalment Not Paid 13
27. Form of Notice 13
28. Forfeiture if Non-Compliance with Notice 13
29. Notice after Forfeiture 14
30. Sale of Forfeited Shares 14
31. Arrears to be Paid Notwithstanding Forfeitures 14
32. Statutory Declaration as to Forfeiture 14
Transfer of Shares 15
33. Transfer of Shares 15
34. Execution of Transfer 15
35. Right to Decline Registration of Partly Paid Shares 15
36. Other Rights to Decline Registration 15
37. Notice of Refusal 16
38. No Fee for Registration 16
39. Untraced Shareholders 16
Transmission of Shares 17
40. Transmission on Death 17
41. Entry of Transmission in Register 18
42. Election of Person Entitled by Transmission 18
43. Rights of Person Entitled by Transmission 18
Alteration of Share Capital 18
44. Increase, Consolidation, Sub-Division and Cancellation 18
45. Fractions 19
46. Reduction of Capital 19
General Meetings 19
47. Extraordinary General Meetings 19
48. Annual General Meetings 19
49. Convening of Extraordinary General Meetings 19
Notice of General Meetings 20
50. Length of Notice 20
51. Omission or Non-Receipt of Notice 20
52. Postponement of General Meetings 20
Proceedings at General Meetings 21
53. Quorum 21
54. Procedure if Quorum Not Present 21
55. Security Arrangements 21
56. Chairman of General Meeting 21
57. Orderly Conduct 22
58. Entitlement to Attend and Speak 22
59. Adjournments 22
60. Notice of Adjournment 22
Amendments 23
61. Amendments to Resolutions 23
62. Amendments Ruled Out of Order 23
Voting 23
63. Method of Voting 23
64. Procedure if Poll Demanded 24
65. When Poll to be Taken 24
66. Continuance of Other Business after Poll Demand 24
67. Votes on a Poll 24
68. Casting Vote of Chairman 24
69. Votes of Joint Holders 24
70. Voting on Behalf of Incapable Member 24
71. No Right to Vote where Sums Overdue on Shares 25
72. Objections of Errors in Voting 25
Proxies 25
73. Execution of Proxies 25
74. Delivery of Proxies 26
75. Maximum Validity of Proxy 26
76. Form of Proxy 26
77. Cancellation of Proxy's Authority 27
Appointment, Retirement and Removal of Directors 27
78. Age of Directors 27
79. Directors' Shareholding Qualification 27
80. Power of Company to Appoint Directors 27
81. Power of Board to Appoint Directors 28
82. Number to Retire by Rotation 28
83. Identity of Directors to Retire 28
84. Filling Rotation Vacancies 28
85. Power of Removal by Special Resolution 28
86. Persons Eligible as Directors 29
87. Position of Retiring Directors 29
88. Vacation of Office by Directors 29
89. Alternate Directors 30
90. Executive Directors 31
Additional Remuneration Expenses and Pensions 31
91. Additional Remuneration 31
92. Expenses 31
93. Pensions and Gratuities for Directors 31
Directors' Interests 32
94. Permitted Interests and Voting 32
Powers and Duties of the Board 35
95. General Powers of Company Vested in Board 35
96. Agents 35
97. Delegation of Individual Directors 36
98. Official Seals 36
99. Registers 36
100. Provision for Employees 36
Proceedings of the Board 37
101. Board Meetings 37
102. Notice of Board Meetings 37
103. Quorum 37
104. Directors below Minimum through Vacancies 37
105. Appointment of Chairman 37
106. Competence of Meetings 38
107. Voting 38
108. Delegation to Committees 38
109. Participation in Meetings by Telephone 38
110. Resolution in Writing 39
111. Validity of Acts of Board or Committee 39
Secretary 39
112. Appointment and Removal of the Company Secretary 39
Seals 39
113. Use of Seals 39
Dividends and Other Payments 40
114. Declaration of Dividends by Company 40
115. Payment of Interim and Fixed Dividends by Board 40
116. Calculation and Currency of Dividends 40
117. Amounts Due on Shares may be Deducted from Dividends 41
118. No Interest on Dividends 41
119. Payment Procedure 41
120. Uncashed Dividends 41
121. Forfeiture of Unclaimed Dividends 42
122. Dividends Not in Cash 42
123. Scrip Dividends 42
Capitalisation of Reserves 44
124. Power to Capitalise Reserves and Funds 44
125. Settlement of Difficulties in Distribution 45
Record Dates 45
126. Power to Choose Any Record Date 45
Accounting Records and Summary Financial Statements 45
127. Records to be Kept 45
128. Inspection of Records 45
129. Summary Financial Statements 46
Service of Notices and Other Documents 46
130. Service of Notices 46
131. Record Date for Service 46
132. Members Resident Abroad 46
133. Service of Notice on Person Entitled by Transmission 47
134. When Notice Deemed Served 47
135. Notice When Post Not Available 47
Destruction of Documents 48
136. Presumptions Where Documents Destroyed 48
Winding Up 49
137. Distribution of Assets Otherwise Than in Cash 49
Indemnity 49
138. Indemnity of Officers 49