28th Mar 2008 10:09
ITV PLC28 March 2008 ITV plc 28 March 2008 Notice of AGM incorporating proposed amendments to ITV's articles of association ITV plc has today posted to shareholders of the Company the notice of meetingfor its Annual General Meeting to be held on Thursday 15 May 2008. The noticeof meeting contains, among others, a resolution which proposes changes to theCompany's Articles of Association ("Articles"). Details of the proposed changesare set out below. It is proposed to adopt new Articles of Association ("New Articles") with effectfrom the conclusion of the Annual General Meeting, principally to reflectcertain provisions of the Companies Act 2006 ("the Act") currently in force andcoming into force in October 2008. As the proposed changes affect variousprovisions in the Company's existing Articles of Association ("Current Articles"), it is considered more practical to seek to replace the Current Articles infull rather than to seek approval for numerous individual amendments. The principal changes introduced in the New Articles are described below. Inparticular, changes which are of a minor, technical or clarifying nature, andalso some more minor changes which merely reflect statutory provisions, have notbeen separately noted. In a number of places, the numbering in the New Articlesvaries from the numbering in the Current Articles (in part because the order ofsome of the articles has been changed for the sake of a more logicalprogression). The number identifying each article principally affected by theamendment corresponds to the numbering in the New Articles (unless otherwiseindicated). 1. ARTICLES WHICH DUPLICATE STATUTORY PROVISIONS Provisions in the Current Articles which replicate provisions contained in theAct are in the main amended to bring them into line with the Act in force on 6April 2008. The main examples of provisions of this type are detailed below,including provisions as to the form of resolutions, the variation of classrights, the convening of general meetings and proxies. References in the CurrentArticles to statutory provisions in the Companies Act 1985 have also beenamended to reflect the new statutory references under the Act where they arealready in force. 2. FORM OF SHAREHOLDER RESOLUTION (ARTICLES 12.1, 56, 64 AND 162) The Current Articles contain a provision that, where for any purpose an ordinaryresolution is expressed to be required, a special or extraordinary resolution isalso effective and that, where for any purpose an extraordinary resolution isexpressed to be required, a special resolution is also effective. This provisionand other provisions in the Current Articles that refer to extraordinaryresolutions are being amended as the concept of extraordinary resolutions hasnot been retained under the Act. Broadly, special resolutions will be used inplace of extraordinary resolutions. 3. VARIATION OF CLASS RIGHTS (ARTICLE 49A) The Current Articles contain provisions regarding the variation of class rights.Certain requirements for a meeting to vary class rights (including the quorumrequirements) are laid down in the Act, and are reflected in the CurrentArticles. However, a new provision has been added to the New Articles in orderto reflect the Act requirement that a member may not call and may not requirethe directors to call a separate meeting of the holders of a class of shares. 4. CONVENING AND NOTICE OF GENERAL MEETINGS (ARTICLES 48 AND 50) The provisions in the Current Articles that refer to extraordinary generalmeetings are being amended as the concept of extraordinary general meetings hasnot been retained under the Act. Extraordinary general meetings will now bereferred to as general meetings. The provisions in the Current Articles dealing with convening general meetingsand the length of notice required to convene general meetings are to be amendedto reflect new provisions in the Act. The New Articles reduce the minimum periodfor general meetings from 21 days to 14 days (even where a special resolution isto be considered) in line with what is permitted by the Act. Annual GeneralMeetings must now generally be held within six months following the end of thefinancial year and the New Articles will reflect this shorter timetable. 5. QUORUM AT GENERAL MEETINGS (ARTICLE 51) As in the Current Articles, the quorum for a general meeting is two persons,present either in person or by proxy. The New Articles clarify that the quorumfor a general meeting is two persons present each of whom is a member, or aproxy or a corporate representative and (in line with the position in the Act)that a person who is a proxy for the same member, or a representative for thesame corporation, may be counted only once for the purpose of calculating thequorum. 6. PROXIES (ARTICLES 50, 66, 68, 75, 76, 78, 79 AND 81) In line with the Act, the New Articles will give proxies the right to vote at ageneral meeting on a show of hands as well as on a poll, whereas under theCurrent Articles, a proxy is only entitled to vote on a poll. The New Articleswill also give proxies the right to speak at general meetings, again reflectingthe Act. The enhanced rights of proxies under the Act affect a number ofprovisions in the New Articles. The New Articles will specify that in order to be valid a proxy appointment mustbe received: (a) not less than 48 hours (or such shorter time as the Boarddecides) before the time appointed for holding the meeting; or (b) in the caseof a poll taken more than 48 hours after the meeting, not less than 24 hours (orsuch shorter time as the Board decides) before the time appointed for taking thepoll; or (c) in the case of a poll taken following the conclusion of themeeting, or adjourned meeting, at which it was demanded but 48 hours or lessafter it was demanded, before the end of the meeting at which it was demanded(or such later time as the Board decides). Consistent with the Act, the Companymay, in setting the deadline for receipt of proxies, exclude non-working days,so that the time before a meeting or a poll by which a proxy must be receivedmay, in certain cases, be greater than 48 or 24 hours. The latest time by whicha proxy appointment may validly be revoked will also be updated in the NewArticles to reflect what is permitted in the Act (the New Articles will providethat the Company must receive notice of the revocation by no later than the lasttime by which proxy notices can be received). Also, the provision that dealswith the time limit within which a representative of a member under incapacityhas to provide evidence satisfactory to the Board of that representative's rightto vote has been amended in order to tie in with the new provisions on timingswith regard to proxies. The provisions relating to the content of notices have also been updated toreflect the additional information required in relation to the appointment ofproxies (including that a member may appoint more than one proxy provided thateach proxy is appointed to exercise the rights attached to a different share orshares held by him). The Current Articles provide that if the Company receives more than one proxyappointment in respect of the same shares, the appointment received last revokeseach earlier appointment. The New Articles retain this concept, but provide thatthe Company may use a different method for determining which appointment isvalid, if it thinks that it is more appropriate. This is in line with thesuggestion made by the Institute of Chartered Secretaries and Administratorsthat articles may need to provide greater flexibility in this regard in light ofthe ability of members to appoint multiple proxies. 7. CORPORATE REPRESENTATIVES (ARTICLE 80) In line with the Act, a member which is a corporation may appoint multiplerepresentatives to act (subject to the Act) at a meeting of the Company. 8. CERTIFICATED SHARES - WARRANTS (ARTICLES 5.3) AND SHARE TRANSFERS (ARTICLE35) In line with the new provisions in the Act on the issue of share certificatesupon the surrender of a share warrant, it is proposed that the New Articles willclarify that in fixing the terms on which a warrant is issued, the Board canspecify the terms on which the share certificate for the relevant underlyingshares will be delivered upon surrender of the warrant. From 6 April 2008, the Act has provided that if a company refuses to register ashare transfer it must give reasons and notify the transferee as soon aspracticable and in any event within two months. The Company proposes to amendthe New Articles to reflect these requirements (previously, the Company did nothave to provide reasons if it exercised its right to refuse to transfer acertificated share). 9. RESOLUTIONS IN WRITING (ARTICLE 72 CURRENT ARTICLES) Article 72 of the Current Articles has been deleted as the Act does not permitpublic companies limited by shares to use the statutory procedure for writtenresolutions. 10. SENDING OF NOTICES, DOCUMENTS ETC (INCLUDING ELECTRONIC ANDWEBCOMMUNICATIONS) (ARTICLES 150 TO 159) The New Articles contain detailed and clarified provisions as to how notices,documents and other information may be sent to or by the Company and extend thenew company communication provisions of the Act to any document or informationsent by the Company. Provisions in the Act, which came into force in January2007, enable companies to communicate with shareholders by electronic andwebsite communications. The New Articles continue to allow communications by theCompany to shareholders in electronic form (provided that the shareholder hasagreed, generally or specifically, to this) and they also continue to permit theCompany to take advantage of the new provisions relating to websitecommunications. Shareholders should note that, as provided by the Act, beforethe Company can communicate with a shareholder by means of a website, theshareholder must be asked individually by the Company to agree that the Companymay send or supply documents or information to him by means of a website and theCompany must either have received a positive response or have received noresponse within 28 days (in which case the Company may take that as consent bythe member to receive communications in this way). Also, when the Company makesa document or information available on its website, it must notify theshareholder of this and a shareholder who has received a document or informationby electronic form or by website can always request a hard copy of the documentor information. The position under the Act, whereby a shareholder may communicate with theCompany by electronic communication if the Company has agreed that the documentor information can be sent or supplied in electronic form (but then only in thetype of electronic form that the Company has agreed to) is clarified in the NewArticles. In certain circumstances, the Act will deem the Company to haveagreed that shareholders may send documents or other information electronically. The changes proposed to be made to the Current Articles to reflect the newcompany communications regime of the Act require a number of conforming changesin the New Articles, including in the Interpretation section. Article 156 of the New Articles sets out when notices, documents and otherinformation given or sent by the Company to its shareholders are deemed to bereceived. A document or information sent by electronic means is deemed to havebeen received on the same day as it is sent (notwithstanding a failure intransmission) and a document or information made available on a website isdeemed to have been received when the intended recipient has been notified (inaccordance with the New Articles) of its availability on the website. Article 150 of the New Articles clarifies that a shareholder who has noregistered address in the United Kingdom is not entitled to have a document orother information sent to him unless he provides the Company with a postaladdress in the United Kingdom or the Company and the shareholder agrees to theuse of electronic communications and the shareholder provides the Company withan address for that purpose. However, the Company is not obliged to agree toprovide electronic communications to a shareholder, and may, for example, refuseto do so where it is concerned that the sending of the document or informationto such address using electronic means would or might cause legal or practicalproblems arising in respect of the laws of, or the requirements of a regulatorybody or stock exchange or other authority in, any territory. 11. INDEMNITY (ARTICLE 164) The Act has in some respects widened the scope of the powers of a company toindemnify directors. In particular, a director of a pension trustee company canbe indemnified against liability incurred in connection with that company'sactivities as trustee of an occupational pension scheme, by the pension trusteecompany itself or by an associated company. The indemnity cannot extend toliabilities to pay criminal or regulatory fines or to defending criminalproceedings in which the director is convicted. Article 164 of the New Articlesupdates the indemnity provisions in the Current Articles by providing that theCompany may (but is not obliged to) indemnify each officer of an associatedcompany to the extent permissible by the Act, including in connection with thatcompany's activities as trustee of an occupational pension scheme. 12. CONFLICTS OF INTEREST AND OTHER DIRECTORS' INTERESTS (ARTICLES 114-119) The Act sets out directors' general duties which largely codify the existing lawbut with some changes. Under the Act, from 1 October 2008 a director must avoida situation where he has, or can have, a direct or indirect interest thatconflicts, or possibly may conflict with the Company's interests. Therequirement is very broad and could apply, for example, if a director becomes adirector of another company or a trustee of another organisation. The Act allowsdirectors of public companies to authorise conflicts and potential conflicts,where appropriate, where the articles of association contain a provision to thiseffect. The Act also allows the articles of association to contain otherprovisions for dealing with directors' conflicts of interest to avoid a breachof duty. The amendments to the Current Articles give the directors authority(subject to the relevant provisions in the Act coming into force) to approvesuch situations and include other provisions to allow conflicts of interest tobe dealt with in a similar way to the current position. There are safeguards which will apply when directors decide whether to authorisea conflict or potential conflict. First, only directors who have no interest inthe matter being considered will be able to take the relevant decision, andsecond, in taking the decision the directors must act in a way they consider, ingood faith, will be most likely to promote the Company's success. The directorswill be able to impose limits or conditions when giving authorisation if theythink this is appropriate. It is also proposed to include provisions relating to confidential information,attendance at board meetings and availability of Board papers to protect adirector being in breach of duty if a conflict of interest or potential conflictof interest arises. These provisions will only apply where the position givingrise to the potential conflict has previously been authorised by the directors.It is the Board's intention to report annually on the Company's procedures forensuring that the Board's powers to authorise conflicts are operated effectivelyor otherwise to follow developing best practice as regards process and reportingin relation to the Board's powers to authorise conflicts. Under the Act, directors are under a duty to declare the nature and extent oftheir direct or indirect interests in transactions and arrangements which areproposed but which have not yet been entered into by the Company and also inexisting transactions and other arrangements that the Company has alreadyentered into. The New Articles update the provisions in this regard to bringthem into line with the Act. A copy of the New Articles marked to show the changes being proposed areavailable for inspection at the registered office of the Company during normalbusiness hours on weekdays (Saturday and public holidays excepted) from todayuntil the date of the Annual General Meeting, and at the place of the AnnualGeneral Meeting from 9.00 am until the conclusion of the Meeting. For further enquiries please contact: ITV plcTel: 0844 8818000 James Tibbitts - Company SecretaryMark Gallagher - Director of Group Corporate Affairs Website: www.itv.com; investor information: www.itvplc.com This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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