Vodafone 2007 Annual Report Download - page 155

Vodafone Group Plc Annual Report 2007 153
The Company’s objects
The Company is a public limited company under the laws of England and
Wales. The Company is registered in England and Wales under the name
Vodafone Group Public Limited Company, with the registration
number 1833679. The Company’s objects are set out in the fourth clause of
its Memorandum of Association and cover a wide range of activities, including
to carry on the business of a holding company, to carry on business as
dealers in, operators, manufacturers, repairers, designers, developers,
importers and exporters of electronic, electrical, mechanical and aeronautical
equipment of all types as well as to carry on all other businesses necessary
to attain the Company’s objectives. The Memorandum of Association grants
the Company a broad range of powers to effect its objects.
Directors
The Company’s Articles of Association provide for a Board of directors,
consisting of not fewer than three directors, who shall manage the business
and affairs of the Company.
Under the Company’s Articles of Association, a director cannot vote in
respect of any proposal in which the director, or any person connected with
the director, has a material interest other than by virtue of the director’s
interest in the Company’s shares or other securities. However, this
restriction on voting does not apply to resolutions (a) giving the director or a
third party any guarantee, security or indemnity in respect of obligations or
liabilities incurred at the request of or for the benefit of the Company,
(b) giving any guarantee, security or indemnity to the director or a third
party in respect of obligations of the Company for which the director has
assumed responsibility under an indemnity or guarantee, (c) relating to an
offer of securities of the Company in which the director participates as a
holder of shares or other securities or in the underwriting of such shares or
securities, (d) concerning any other company in which the director
(together with any connected person) is a shareholder or an officer or is
otherwise interested, provided that the director (together with any
connected person) is not interested in 1% or more of any class of the
company’s equity share capital or the voting rights available to its
shareholders, (e) relating to the arrangement of any employee benefit in
which the director will share equally with other employees and (f) relating
to any insurance that the Company purchases or renews for its directors or
any group of people, including directors.
The directors are empowered to exercise all the powers of the Company to
borrow money, subject to the limitation that the aggregate amount of all
liabilities and obligations of the Group outstanding at any time shall not
exceed an amount equal to 1.5 times the aggregate of the Group’s share
capital and reserves calculated in the manner prescribed in the Articles of
Association, unless sanctioned by an ordinary resolution of the Company’s
shareholders.
In accordance with the Company’s Articles of Association, directors retiring at
each AGM are those last elected or re-elected at or before the AGM held in
the third calendar year before the current year. In 2005, the Company
reviewed its policy regarding the retirement and re-election of directors and,
although it is not intended to amend the Company’s Articles in this regard,
the Board has decided, in the interests of good corporate governance, that all
the directors should offer themselves for re-election annually. Accordingly, all
the directors, except for Lord Broers who is retiring, will submit themselves for
re-election at the 2007 AGM.
No person is disqualified from being a director or is required to vacate that
office by reason of age.
Directors are not required, under the Company’s Articles of Association, to
hold any shares of the Company as a qualification to act as a director,
although executive directors participating in long term incentive plans must
comply with the Company’s share ownership guidelines. In accordance with
best practice in the UK for corporate governance, compensation awarded to
executive directors is decided by a remuneration committee consisting
exclusively of non-executive directors.
In addition, as required by The Directors’ Remuneration Report Regulations,
the Board has, since 2003, prepared a report to shareholders on the directors’
remuneration which complies with the Regulations (see pages 78 to 87). The
report is also subject to a shareholder vote.
Rights attaching to the Company’s shares
Dividend rights
Holders of the Company’s ordinary shares may, by ordinary resolution, declare
dividends but may not declare dividends in excess of the amount
recommended by the directors. The Board of directors may also pay interim
dividends. No dividend may be paid other than out of profits available for
distribution. Dividends on ordinary shares will be announced in pounds
sterling. Holders of ordinary shares with a registered address in a euro-zone
country (defined, for this purpose, as a country that has adopted the euro as
its national currency) will receive their dividends in euro, exchanged from
pounds sterling at a rate fixed by the Board of directors in accordance with
the Articles of Association. Dividends for ADS holders represented by ordinary
shares held by the Depositary will be paid to the Depositary in US dollars,
exchanged from pounds sterling at a rate fixed by the directors in accordance
with the Articles of Association, and the Depositary will distribute them to the
ADS holders.
If a dividend has not been claimed for one year after the date of the
resolution passed at a general meeting declaring that dividend or the
resolution of the directors providing for payment of that dividend, the
directors may invest the dividend or use it in some other way for the benefit
of the Company until the dividend is claimed. If the dividend remains
unclaimed for 12 years after the relevant resolution either declaring that
dividend or providing for payment of that dividend, it will be forfeited and
belong to the Company.
Special distribution
At an Extraordinary General Meeting of the Company on 25 July 2006,
shareholders approved a distribution of capital of approximately £9 billion by
way of a B share scheme, equating to 15 pence per B share for every ordinary
share in issue as at 28 July 2006. The Company has made payments against B
shares redeemed in August 2006 and February 2007. Outstanding B shares in
issue are entitled to accrue a continuing dividend rate of 75% of sterling
LIBOR, payable semi-annually in arrears, on future redemption dates in the
calendar years 2007 and/or 2008 on 5 February or 5 August respectively, until
redemption. The B shares may be redeemed by the Company in full, unless
elected to be redeemed earlier by holders of B shares, on 5 August 2008.
Voting rights
The Company’s Articles of Association provide that voting on Substantive
Resolutions (i.e. any resolution which is not a Procedural Resolution) at a
general meeting shall be decided on a poll. On a poll, each shareholder who
is entitled to vote and is present in person or by proxy has one vote for every
share held. Procedural Resolutions (such as a resolution to adjourn a General
Meeting or a resolution on the choice of Chairman of a General Meeting)
shall be decided on a show of hands, where each shareholder who is present
at the meeting has one vote regardless of the number of shares held, unless a
poll is demanded. In addition, the Articles of Association allow persons
appointed as proxies of shareholders entitled to vote at general meetings to
vote on a show of hands, as well as to vote on a poll and attend and speak at
general meetings. Holders of the Company’s ordinary shares do not have
cumulative voting rights.
Under English law, two shareholders present in person constitute a quorum
for purposes of a general meeting, unless a company’s articles of association
specify otherwise. The Company’s Articles of Association do not specify
otherwise, except that the shareholders do not need to be present in person,
and may instead be present by proxy, to constitute a quorum.
Under English law, shareholders of a public company such as the Company
are not permitted to pass resolutions by written consent.
Record holders of the Company’s ADSs are entitled to attend, speak and
vote on a poll or a show of hands at any general meeting of the Company’s
shareholders by the Depositary’s appointment of them as corporate
Shareholders