Hochschild Regulatory News (HOC)

10 Apr 2008 18:15

Hochschild Mining PLC10 April 2008 Hochschild Mining plc10 April 2008 Notice of AGM incorporating proposed amendments to Hochschild Mining plc'sArticles of Association Hochschild Mining plc ("the Company") has today posted to its shareholders thenotice of meeting in respect of the Annual General Meeting ("the AGM") to beheld on Friday 9 May 2008. The notice of meeting contains, among others,resolutions which propose changes to the Company's Articles of Association("Articles"). Shareholders are being requested to approve two sets of changes to the Articles.The first, which shall take effect from the end of the AGM, amends the Articlesto ensure that they are consistent with the provisions of the Companies Act 2006("the 2006 Act") currently in force. The second set of changes amends, witheffect from 1 October 2008, the provisions of the Articles relating toDirectors' conflicts of interests. Further details of these amendments are givenin paragraph 10 of the summary below. Summary of changes to the Articles Unless otherwise stated, references below to Article numbers are to the numbersin the proposed new Articles marked 'SET A'. 1. Form of resolutionThe current Article 2 provides that, where for any purpose an ordinaryresolution is required, a special or an extraordinary resolution is alsoeffective. This Article (and any other reference to an extraordinary resolutionin the current Articles) is being amended because the concept of anextraordinary resolution is no longer necessary. Under the Companies Act 1985(the "1985 Act"), the main difference between a special resolution and anextraordinary resolution was that a meeting at which an extraordinary resolutionwas to be proposed required only 14 days' notice. The shortening of the noticeperiod required for a special resolution (as outlined in paragraph 4 below)under the 2006 Act makes the concept of an extraordinary resolution redundant. 2. Issue of share certificates (Article 17)Under the 2006 Act, a company must issue a share certificate where a sharewarrant is surrendered for cancellation, unless the Articles provide otherwise.Changes are included to reflect this. 3. Registration of share transfers (Article 36)The current Articles provide that the directors may refuse to register atransfer of shares without providing the transferee with further information.The 2006 Act makes it clear that the reasons for a refusal to transfer sharesmust be given as soon as possible (and, in any case, within two months) to thetransferee and the directors must also provide the transferee with any furtherinformation about the reasons for the refusal as the transferee may reasonablyrequest. Changes are included to reflect this. 4. Convening annual and extraordinary general meetings (Articles 46-49)The provisions in the Articles dealing with the convening of general meetingsand the length of notice required to convene general meetings are being amendedto conform to the new provisions in the 2006 Act. In particular, anextraordinary general meeting to consider a special resolution can now beconvened on 14 days' notice whereas, previously, 21 days' notice was required. 5. Chairman (Article 50)The 2006 Act permits a proxy to act as Chairman but this possibility is excludedby the wording of this Article. 6. Chairman's casting vote (Article 63)The definition of an ordinary resolution in the 2006 Act is new and refers to aresolution "of the members" being passed by a simple majority. This would appearto exclude the possibility that the Chairman of the meeting might be able tohave a casting vote in his capacity as such. Therefore, the likelihood of theChairman's casting vote being needed is, by virtue of this new definition,remote and the provision is being removed from the Articles. 7. Proxies (Articles 67-71)Under changes included in the 2006 Act, a proxy is now entitled to exercise therights to attend and to speak and vote at a meeting of the Company, whether on ashow of hands or on a poll. Each proxy is also entitled to one vote on a show ofhands. In addition, the time limits for the appointment or termination of aproxy appointment have been altered by the 2006 Act so that the Articles cannotnow provide that a proxy should be received more than 48 hours before themeeting or adjourned meeting or, in the case of a poll taken more than 48 hoursafter it was demanded, more than 24 hours before the time for the taking of apoll, with weekends and bank holidays being excluded for this purpose. Further,multiple proxies may be appointed provided that each proxy is appointed toexercise the rights attached to a different share or shares held by theshareholder. Changes are included in the Articles to reflect this. 8. Corporate representatives (Article 72)The 2006 Act expressly confirms the right of a corporate shareholder to appointmultiple corporate representatives. Unlike the position of multiple proxies (seeparagraph 7 above), multiple corporate representatives must exercise each oftheir powers in the same way, failing which they are treated as having notexercised the power at all. Changes are included in the Articles to reflectthis. 9. Directors' written resolutions (Article 94)This Article has been adjusted to clarify that a resolution in writing of thedirectors can be passed using electronic means. The new wording also eliminatesthe restriction excluding directors outside the UK from the decision-makingprocess, but does exclude directors who are not entitled to vote. The resolutionmust be signed by at least the number of directors required to make up a quorumfor a directors' meeting. 10. Conflicts of interest and authorisations of Directors' interests (Articles97.1-97.4) (included in the articles marked 'Set B' only) The 2006 Act sets out directors' general duties which largely codify theexisting law but with some changes. Under the 2006 Act, from 1 October 2008 adirector must avoid a situation where he has, or can have, a direct or indirectinterest that conflicts, or possibly may conflict with the company's interests.The requirement is very broad and could apply, for example, if a directorbecomes a director of another company or a trustee of another organisation. The2006 Act allows directors of public companies to authorise conflicts andpotential conflicts, where appropriate, where the articles of associationcontain a provision to this effect. The 2006 Act also allows the articles ofassociation to contain other provisions for dealing with directors' conflicts ofinterest to avoid a breach of duty. The Articles give the directors authority toapprove such situations and to include other provisions to allow conflicts ofinterest to be 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, andsecondly, in taking the decision the directors must act in a way they consider,in good faith, will be most likely to promote the company's success. Thedirectors will be able to impose limits or conditions when giving authorisationif they think this is appropriate. It is also proposed that the Articles should contain provisions relating toconfidential information, attendance at board meetings and availability of boardpapers to protect a director being in breach of duty if a conflict of interestor potential conflict of interest arises. These provisions will only apply wherethe position giving rise to the potential conflict has previously beenauthorised by the directors. It is the board's intention to report annually onthe Company's procedures for ensuring that the board's powers to authoriseconflicts are operated effectively. 11. The seal (Article 109)This Article has been adjusted to reflect the provisions of the 2006 Act wherebythe execution of instruments by a director in the presence of a witness willhave the same effect as if such instrument had been executed under the seal ofthe Company. 12. Directors' liabilities and indemnities (Article 141)The 2006 Act has widened slightly the scope of powers of the Company toindemnify directors and to fund expenditure incurred in connection with certainactions against directors. In particular, a company that is a trustee of anoccupational pension scheme can now indemnify a director against liabilityincurred in connection with the company's activities as trustee of the scheme.In addition, whilst the existing Articles allow the Company to provide money forthe purpose of funding a director's defence in "proceedings", the 2006 Actclarifies this further by allowing the Company to provide money for the purposeof funding a director's defence in regulatory proceedings. Changes are includedin the Articles to reflect this. An amendment to Article 140.B is also proposed to clarify that defenceexpenditure is available only to meet expenditure incurred by that Director orSecretary (or former Director or Secretary) whilst defending civil or criminalproceedings in connection with negligence, default, breach of duty or breach oftrust by him in relation to the Company. This is narrower than the wording underthe 1985 Act, which in theory applied to any civil or criminal proceedings,whether or not they related to the Company. Copies of Articles available for Inspection The full terms of the proposed amendments to the Articles are available forinspection at the registered office of the Company and at the offices ofLinklaters LLP at One Silk Street, London EC2Y 8HQ, United Kingdom during usualbusiness hours on any weekday (Saturdays, Sundays and public holidays excluded)until the date of the AGM and also on the date and at the place of the AGM from15 minutes prior to the commencement of the meeting until the conclusionthereof. This information is provided by RNS The company news service from the London Stock Exchange