Untitled - David Kronemyer

T. SHARE CAPITAI,
The general authority given tr.r the Directors at the 1987 Annual Ceneral Meeting to allot
shares, in cedain circumstances, up to an amount equal to the authorised share capital of
the Company then unissued, expires on l0 December, l9B8 and it is proposed to renew this
authority so as to expire at the conclusion ofthe Annual Ceneral Meeting ofthe Company to
be held in 1989.
An Ordinary Resolution is required for this purpose and the text is set out in
Resolution 5 of the Notice of Annual General Meeting on page 12.
The general authority referred to above does not of itself permit the Directors to issue
shares for cash except in the case of a rights issue made available to all holders of Ordinary
Shares (i.e. statutory pre-emption rights). Therefore, to overcome the problems associated
with fractional entitlements and issues to overseas holders which are prohibited by relevant
local laws and to permit the issue of shares for cash otherwise than to existing shareholders,
it is necessary to seek approval to disapply the statutory pre-emption rights.
At the l9tl7 Annual General Meeting, the Directors were authorised by Special
Resolution to disapply the statutory pre-emption rights irr respect of {ractions and overseas
holders and in accordance with the limits prescribed by The Stock Exchange and the
lnvestment (lommittee of the Association of British lnsurers ("the ABI") to issue for cash
Ordinary Shares equal to 2.57o ofthe issued Ordinary Share capital to percons other than
existing shareholders.
This year, in accordance with The Stock Exchange's most recent guidelines on
Shareholders' Pre-emptive Rights, the Directors are seeking approval of shareholders to the
disapplication of the statutory pre-emption rights in relation to the allotment of shares for
cash to existing shareholders where shares cannot, for valid reasons, be offered to
shareholders resident outside the United Kingdom, or where fractional entitlements arise.
In addition, a disapplication is sought for issues for cash of up to an aggregate nominal value
equal to 5% of the issued Ordinary Share capital to persons other than to exisl ing
shareholders.
A Special Resolution is required fbr this purpose and the text is set out in Resolution 6
ol the Notice of Annual Ceneral Meeting on pages l2 and 13.
2. PTJRCHASE OF OWN SHARES
Background
A company may, if authorised to do so by its Articles of Association, purchase its own shares
provided that it has obtained the approval of shareholders in general rneeting. Article I I (b)
of the Aticles of Association of the Company contains the necessary authority.
The approval of Shareholders is required to be given by the passing of Extraordinary
Resolutions Numbered I at separate Class Meetings o[the holders of the 3.5 per cent.
Preference Shares and the 7 per cent. Convertible Shares and by the passing of Resolution 7
(a Special Resolution) by the Company in ()eneral Meeting. (See Notices of separate Class
Meetings set out on pages l0 and I I and of Annual Ceneral Meeting set out on pages 12 to
l5 inclusive. )
The Board will not be able to exercise any authority to purchase its own Ordinary
Shares granted to the Company by the Members in any general meeting or separate class
meeting until such time as the consent of the Wanant holders has been obtained; this is in
accordance with The Stock Exchange Regulations and pursuant to the Instrument by way of
Deed Poll creating the same. Accordingly, the consent of the Wamant holders is being
sought.