Exhibit 5
Signet Group plc Herbert Smith LLP
15 Golden Square Exchange House
London Primrose Street
W1F 9JG London EC2A 2HS
T +44 (0)20 7374 8000
F +44 (0)20 7374 0008
DX 28
www.herbertsmith.com
Our ref
2038/5587/30846746
Your ref
Date
12 May 2006
Dear Sirs,
SIGNET GROUP PLC 2005 LONG-TERM INCENTIVE PLAN AND SIGNET GROUP PLC US SHARE
OPTION PLAN 2003 (THE "PLANS")
This opinion is given by Herbert Smith LLP which
assumes liability for and is responsible for it. No individual owes or shall owe
any duty of care to you for or in relation to this opinion.
1. THE PLANS
1.1 We have acted as English legal advisers to Signet Group plc ("SIGNET")
in connection with the requirement for an opinion from counsel to
Signet for the purposes of the Registration Statement on Form S-8 to be
filed with the Securities and Exchange Commission on 12 May 2006 (the
"S-8") relating to 100 million ordinary shares of 0.5p each of Signet
("ORDINARY SHARES") which may be issued pursuant to the exercise of
options granted under the Plans.
1.2 We have been informed by Signet that it is its intention that, if
awards under the Plans are to be satisfied by the issue of new Ordinary
Shares:
1.2.1 such Ordinary Shares would be issued to the trustee (the
"TRUSTEE") of the Signet Group plc Employee Share Trust
established by Signet (the "TRUST") or, at the direction of
the Trustee, to the person entitled to them under the terms of
the award;
1.2.2 the Trustee would pay to Signet for the issue of such Ordinary
Shares a price at least equal to the aggregate nominal value
of such Ordinary Shares (or, where the participant pays an
exercise price to exercise the option, the full exercise price
received from the participant);
1.2.3 the Ordinary Shares (if not issued direct to the person so
entitled to them) would be transferred by the Trustee to that
person; and
1.2.4 where moneys are not received from a participant on the
exercise of an option, the funds out of which the Trustee
would pay that price would:
(A) in the case of the person entitled to the Ordinary
Shares being employed by Signet itself, be paid to
the Trustee by Signet; and
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(B) in the case of the person entitled to the Ordinary
Shares being employed by a subsidiary of Signet (the
"EMPLOYING SUBSIDIARY"), normally be paid to the
Trustee by the Employing Subsidiary but, if the
Employing Subsidiary fails to do so, Signet itself
would pay to the Trustee sufficient funds to enable
it to pay a price equal to the nominal value of such
Ordinary Shares.
2. SCOPE OF THIS OPINION
2.1 We are solicitors qualified in England and Wales. We express no opinion
as to any law other than English law as applied by English courts at
the date of this opinion.
2.2 No opinion is expressed as to matters of fact.
2.3 We express no opinion on any encumbrances, restrictions or prohibitions
that may arise by law that may affect any particular holder or
prospective holder of any of the Ordinary Shares.
2.4 Other than the giving of this opinion, we have not advised in
connection with the S-8 or any related document. In particular, but
without affecting the generality of the foregoing sentence, we have not
advised on the type, adequacy, nature and appropriateness of any of the
content of the S-8.
2.5 We have made no investigations and express no opinion as to whether
Signet has obtained all and any necessary consents, approvals or
licences of any court or governmental agency or of any political
subdivision thereof of any applicable jurisdiction other than in
England and Wales including, without limitation, those of the United
States of America, for the issue by Signet of Ordinary Shares pursuant
to the Plans.
2.6 This opinion is governed by and shall be construed in accordance with
English law and is given on condition that the courts of England have
exclusive jurisdiction to settle any dispute arising out of or in
connection herewith.
3. DOCUMENTS WHICH WE HAVE EXAMINED AND ENQUIRIES WHICH WE HAVE MADE
3.1 We have examined and relied upon copies of the following documents for
the purposes of giving this opinion:
3.1.1 the resolutions passed at meetings of the board of directors
of Signet and the resolutions passed at the general meetings
of the shareholders of Signet approving the Plans,
respectively;
3.1.2 the rules of each of the Plans;
3.1.3 the Trust Deed constituting the Trust;
3.1.4 the Memorandum and Articles of Association of Signet current
at the date hereof; and
3.1.5 the S-8.
3.2 On 11 May 2006, at 11.30 a.m. we carried out a search of the Companies
House Direct service operated by the Registrar of Companies in England
and Wales in respect of Signet.
3.3 On 11 May 2006, at 11.20 a.m. we carried out a telephone search of
Signet of the Central Index of Winding-Up petitions maintained by the
Companies Court.
3.4 Except as stated above, we have not for the purpose of this opinion
examined any agreements, documents or corporate records entered into by
or affecting Signet or made any other enquiries concerning Signet or
the Ordinary Shares.
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4. ASSUMPTIONS
4.1 This opinion is based upon the assumption (which may or may not be the
case) that:
4.1.1 all documents (including copy documents) and all signatures
and/or seals thereon are genuine;
4.1.2 all documents (including the constitutional documents) which
we have reviewed are and remain up-to-date and effective;
4.1.3 Signet was solvent immediately after each of the Plans was
adopted and has not become insolvent as a result of adopting
either of the Plans or otherwise and that Signet has not
entered into any composition or arrangement with its creditors
(or any class of them);
4.1.4 in the case of any document from which extracts only have been
supplied to us, the extracts do not reveal a misleading view
of the document as a whole;
4.1.5 all statements or opinions as to the matters of fact or
intention made by an officer or officers of Signet (whether in
writing or orally) to us and upon which we have relied without
making any further enquiry in giving this opinion are true,
accurate and complete; and
4.1.6 no relevant restriction or prohibition on the holding of
Ordinary Shares applying on or to a particular person will
apply to prevent or restrict the issue or sale of the Ordinary
Shares to that particular person.
4.2 In giving this opinion we have also assumed that at the date of issue
of any of the Ordinary Shares under the Plans:
4.2.1 each of the Plans and the Trust continues to constitute an
employees' share scheme as defined in Section 743 of the
Companies Act 1985;
4.2.2 Signet will have sufficient duly created and duly authorised
but unissued Ordinary Shares;
4.2.3 such Ordinary Shares will be issued in the manner described in
paragraph 1.2 above;
4.2.4 such Ordinary Shares will be duly issued in accordance with
the rules of the Plan under which the relevant award has been
made, and that the amounts referred to in paragraph 1.2.2
above have been paid in full;
4.2.5 such Ordinary Shares will be duly issued in accordance with
Signet's Articles of Association and the Companies Act 1985;
4.2.6 the Directors of the Employing Subsidiary or a duly authorised
committee thereof will validly have concluded (if applicable)
that the contribution by such subsidiary to the Trustee of
funds out of which to pay the price for the issue of the
Ordinary Shares is bona fide in the interests of that
subsidiary for the purpose of an employees' share scheme (as
so defined) and that if Signet itself makes the contribution
whether in respect of its own employees or by reason of
failure by the relevant Employing Subsidiary to do so, the
Directors of Signet or a duly authorised committee thereof
will have validly concluded (if applicable) that such
contribution is bona fide in the interests of Signet for the
purposes of an employees' share scheme (as so defined) and the
amount of such contribution is, if required by law, provided
out of distributable profits of Signet;
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4.2.7 the Directors of Signet or a duly authorised committee thereof
will have passed and not amended or revoked the necessary
resolutions to allot and issue the Ordinary Shares, and such
resolutions remain in full force and effect;
4.2.8 there will not have been any change to applicable English law
affecting the issue of the Ordinary Shares or, if there is
such a change, Signet will have complied with any such law as
amended; and
4.2.9 Signet will not have become insolvent, subject to liquidation
or winding-up procedures, receivership or administration or
struck off the register or otherwise become subject to any
legal disability to issue shares.
5. OPINION
Subject to the matters set out above including without limitation the
assumptions contained in paragraph 4, and to matters not disclosed to
us, it is our opinion that the Ordinary Shares to be issued pursuant to
the exercise of options granted under each of the Plans will be validly
issued and will be fully paid or credited as fully paid and no further
contribution in respect of the Ordinary Shares will be required to be
made to Signet by the holders thereof by virtue only of their being
such holders.
6. ADDRESSEES
This opinion is for the use and benefit of yourselves only and shall
not be disclosed or communicated to, or relied on by, any other party
or for any other purpose, or quoted or referred to in any public
document, or filed with any governmental agency or other person,
without our prior written consent. We hereby consent to the filing of
this opinion as an exhibit to the S-8 and the use of our name in the
S-8 in the form and context in which it appears therein.
Yours faithfully,
/s/ HERBERT SMITH LLP
HERBERT SMITH LLP
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