Annual Report 2012 - Development Securities PLC

The Directors have no present intention of exercising this
authority. However, the Directors consider it desirable to
have the maximum flexibility permitted by corporate
governance guidelines to respond to market
developments and to enable allotments to take place
to finance business opportunities as they arise.
Special Resolution 15 – Disapplication of pre-emption
rights
Under section 561(1) of the Companies Act 2006, if the
Directors wish to allot any shares and other relevant
securities, or sell treasury shares for cash (other than in
connection with an employee share scheme), they must
in the first instance offer them to existing shareholders in
proportion to their holdings. The Directors seek authority
to renew the disapplication of shareholders’ pre-emptive
rights. The purpose of paragraph (i) of Resolution 15 is
to authorise the Directors to allot any shares pursuant to
the authority given by paragraph (i) of Resolution 14 for
cash either (a) in connection with a pre-emptive offer or
rights issue or (b) otherwise up to a nominal value of
£3,058,812 (being equivalent to 5.0 per cent of the total
issued ordinary share capital of the Company as at
30th April 2012 (being the latest practicable date prior
to publication of the notice)), in each case without
the shares first being offered to existing members
in proportion to their existing holdings.
The purpose of paragraph (ii) of Resolution 15 is to
authorise the Directors to allot any shares pursuant to
the authority given by paragraph (ii) of Resolution 14 for
cash in connection with a rights issue without the shares
first being offered to existing members in proportion to
their existing holdings. This is in line with corporate
governance guidelines issued by the Pre-emption Group.
The Board considers the authority sought to be
appropriate in order to allow the Company flexibility to
finance business opportunities or to conduct a
pre-emptive offer or rights issue without the need to
comply with the strict requirements of the statutory
pre-emption provisions. The Board intends to adhere to
the provisions in the Pre-emption Group’s Statement of
Principles not to allot shares on a non pre-emptive basis
(other than pursuant to a rights issue or pre-emptive
offer) in excess of an amount equal to 7.5 per cent of
the total issued ordinary share capital of the Company
within a rolling three year period without prior
consultation with shareholders.
Report of the Directors
Special Resolution 16 – Notice period for general
meetings
The Companies (Shareholders’ Rights) Regulations 2009
increased the notice period for general meetings of a
company to 21 clear days unless shareholders approve a
shorter period, which cannot be less than 14 clear days.
At the Annual General Meeting of the Company held
on 27th May 2011, shareholders authorised the calling of
general meetings, other than an annual general meeting,
on not less than 14 clear days’ notice. Resolution 16
seeks the approval of shareholders to renew the
authority to be able to call general meetings (other than
an annual general meeting) on 14 clear days’ notice.
The shorter notice period would not be used as a
matter of routine for general meetings, but only where
the flexibility is merited by the business of the meeting
and is thought to be to the advantage of shareholders as
a whole. If the proposals at a given meeting are not time
sensitive, the Company will not normally use the shorter
notice period. The approval will be effective until the
Company’s next annual general meeting, when it is
expected that a similar resolution will be proposed. It
should also be noted that the changes to the Companies
Act 2006 mean that, in order to be able to call a general
meeting on less than 21 clear days’ notice, the Company
must make a means of electronic voting available to all
shareholders for that meeting.
Ordinary Resolution 17 – Political donations
Part 14 of the Companies Act 2006, amongst other
things, prohibits the Company and its subsidiaries from
making political donations or from incurring political
expenditure in respect of a political party or other political
organisation or an independent election candidate unless
authorised by the Company's shareholders. Aggregate
donations made by the Group of £5,000 or less in any
twelve month period will be disregarded.
Neither the Company nor any of its subsidiaries has
any intention of making any political donation or incurring
any political expenditure. However, the Companies Act
2006 defines "political organisation", "political party",
"political donation" and "political expenditure" widely.
Accordingly, the Company wishes to ensure that neither it
nor its subsidiaries inadvertently commits any breaches
of the Companies Act 2006 through the undertaking of
routine activities, which would not normally be considered
to result in the making of political donations and political
expenditure being incurred.
Development Securities PLC / Annual Report 2012 49