BABCOCK & BROWN

8. Additional information
the liability is a liability owed to Babcock & Brown or a related
body corporate or the liability arises out of conduct involving
a lack of good faith on the part of the Officer or conduct
attracting the civil penalty provisions of the Corporations
Act. Officers are also indemnified by Babcock & Brown,
subject to certain exceptions, for costs (including legal costs)
and expenses incurred in defending an action for a liability
incurred in acting as an Officer of Babcock & Brown.
Babcock & Brown also provides an indemnity, on similar terms
to those described in the preceding paragraph, in relation to
current and former directors and secretaries of Babcock &
Brown who are or were serving as a director or secretary of
another company at the request of Babcock & Brown.
Babcock & Brown may pay insurance premiums on behalf
of an Officer of Babcock & Brown or of a subsidiary of
Babcock & Brown, other than in relation to a liability arising
out of conduct involving wilful breach of duty in relation
to Babcock & Brown or a contravention of civil obligations
under the Corporations Act prohibiting improper use of
position or information gained in that position.
8.5.10 Proportional takeover provisions
The Constitution requires an ordinary resolution to approve
registration of a transfer giving effect to an offer made under
a proportional takeover scheme. The provision regulating
proportional takeover bids must be renewed in a general
meeting every three years to remain effective.
8.5.11 Share buy back
Babcock & Brown may, in accordance with the Corporations
Act and the Listing Rules, buy back its own shares on any
terms and conditions determined by the Directors. The
consideration paid for a buy back of shares may include
specific assets, including securities of Babcock & Brown
or of any other corporation, trust or entity.
8.5.12 Variation of rights
Subject to the Corporations Act and the Listing Rules, all or
any of the rights attached to any class of shares may be varied
or cancelled with the consent in writing of the holders of
at least 75% of the issued shares in the particular class or the
sanction of a special resolution passed at a meeting of holders
of shares in that class.
8.5.13 Unmarketable parcel
If a shareholder holds a number of shares which is less than a
marketable parcel (as defined in the Listing Rules) Babcock
& Brown may, as agent for the shareholder, sell or dispose
of such shares held by each unmarketable parcel holder on
any terms and in that manner and at those times which the
Directors determine provided that the procedures set out in
the Constitution are followed.
8.5.14 Alteration of the Constitution
The Constitution can only be amended by a special resolution
passed by at least 75% of votes cast by shareholders present and
entitled to vote at a general meeting of Babcock & Brown.
8.6 Summary of BBIPL Constitution
US Executive Stakeholders hold such interests in Babcock
& Brown acquired in the IPO indirectly through their
shareholdings in BBIPL, the holding company for Babcock
& Brown’s operations. The US Executive Stakeholders hold
such interest at the BBIPL level because direct ownership
at the Babcock & Brown level would have materially
adverse tax consequences for US Executive Stakeholders.
The following summary sets out details of the special
provisions in the BBIPL Constitution that regulate the
relationship between:
• Babcock & Brown, which holds a majority shareholding
in BBIPL in the form of ‘A Class’ shares (A Class Shares)
(Babcock & Brown is the sole holder of A Class Shares); and
• the various US Executive Stakeholders who hold
redeemable preference shares in BBIPL (B Class Shares).
The various special provisions in the BBIPL Constitution are
designed to provide an appropriate balance between the rights
of Babcock & Brown and those of the B Class Shareholders.
An overriding principle in relation to that balance, however, is
that B Class Shareholders should not interfere with the ability
of Babcock & Brown’s Shareholders to determine issues
concerning control of Babcock & Brown and of Babcock
& Brown as a whole.
Specific relevant provisions of the BBIPL Constitution are
summarised as follows. This Section 8.6 is not intended to be
an exhaustive summary of the BBIPL Constitution. Investors
who wish to inspect the BBIPL Constitution may do so at
the registered office of Babcock & Brown during normal
office hours.
70 BABCOCK & BROWN SUBORDINATED NOTES