Exhibit 3.1
DATED 28 February 2001
(1) XXXXXXXXXXXX.XXX PLC
(2) SQUASH LIMITED
(3) UK PROPERTY XXXXXXX.XXX LIMITED
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SHAREHOLDERS AGREEMENT
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XXXXXXX XXXXX & Co
SOLICITORS
DIDSBURY HOUSE
000 XXXXXXXX XXXX
XXXXXXXX
XXXXXXXXXX X00 0XX
T H I S A G R E E M E N T is made 28 February 2001
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B E T W E E N:-
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(1) TOWN XXXXXXXX.XXX PLC (Registered in England No. 3608347 ) whose
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registered office is situated atWelton Xxxxx, Xxxx Xxxx, Xxxxx,
Xxxxxxxxx XX00 0XX ("TPN");
(2) SQUASH LIMITED (Registered in the Commonwealth of the Bahamas No. 455B)
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whose registered office is situate at H & J Corporate Services Limited,
Sherlaw House, Xxxxxxx Street, P. O. Box SS- 19084, Nassau, Bahamas
(ASquash@); and
(3) UK PROPERTY XXXXXXX.XXX LIMITED (Registered in England No. 3668169) whose
registered office is situated at 0xx Xxxxx Xxxxxxxx Xxxxx,000 Xxxxxxxx
Xxxx, Xxxxxxxx, Xxxxxxxxxx X00 0XX ("the Company").
W H E R E A S:-
(A) The Company is a private company incorporated in England on 16 November
1998 in the original name of Video Promotions (UK) Limited (subsequently
changed to its present name by Special Resolution dated 15 March 2000)
under Company Number 3668169.
(B) The Company has an authorised share capital of ,1,000 divided into 1,000
Ordinary Shares of ,1.00 each of which 200 have been issued and are fully
paid and are held as to 60 by or on behalf of Squash and 140 by or on
behalf of TPN.
(C) TPN and Squash have agreed that they shall be shareholders in the Company
which shall be run as a joint venture company and that the management of
the Company and their association therein shall be governed by the terms
and conditions hereinafter appearing.
.
NOW IT IS HEREBY AGREED as follows:-
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1. DEFINITIONS
1.1 In this Agreement unless the context otherwise requires the following
words and expressions shall have the following meanings:-
means the articles of association of the
"the Articles" Company from time to time including the new
articles of association to be adopted pursuant to
the Resolutions.
"the Auditors" means the auditors for the time being of the
Company appointed in accordance with the
provisions of the Companies Acts 1985 and 1989.
The present Auditors are Xxxxx Xxxxx.
"Board" the duly appointed board of directors for the time
being of the Company.
"Board Representative" a director of the Company
appointed by TPN or by Squash pursuant to the
terms of this Agreement.
"the Business" means the business of the creation and
management of websites for estate agents and the
sale of advertising space thereon carried on by
the Company.
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"the Completion Date" 10 working days after the date of
this Agreement or such earlier date as shall be
agreed by TPN and Squash.
"Dividend Policy" The dividend policy of the Company
described in clause 8 below.
"the Resolutions" means the special resolutions set out in
Schedule 1 to be adopted by the Company on the
Completion Date.
"Restricted Period" means (in respect of either Shareholder)
the period during which that Shareholder holds (or
is otherwise beneficially entitled to) any shares
in the Company and for two years thereafter.
"Shareholders" means TPN and Squash together (construed in
accordance with clause 1.5) and "Shareholder"
shall be construed accordingly.
1.2 Words and expressions defined in the Companies Acts 1985 and 1989 have the
same meanings in this Agreement but excluding any statutory modification
thereof not in force at the date of this Agreement.
1.3 Reference to any statute or statutory provisions includes a reference to
that statute or statutory provisions as from time to time amended extended
or re-enacted.
1.4 Where applicable, words denoting the masculine gender shall include the
feminine and neuter genders and words denoting the singular shall include
the plural and vice versa and references to persons shall include
corporations.
1.5 References to the parties and any of them shall be deemed to include the
respective legal personal representatives, successors in title and assigns
from time to time of those parties.
1.6 The clause headings shall not affect the construction of this Agreement
and references to clauses, sub-clauses, paragraphs and Schedules are to
clauses, sub-clauses and paragraphs of, and Schedules to this Agreement.
1.7 Where any obligation is taken on by more than one person such obligation
shall unless otherwise expressly stated be joint and several.
2. AGREEMENT
2.1 In consideration of the execution of this Agreement by the other parties
thereto each party hereby agrees to be bound by the terms of this
Agreement.
2.2 This Agreement supersedes any previous agreement between the parties
concerning the Companies.
2.3 TPN warrants that Ci4Net,Com Limited has no rights over the share capital
of the Company.
3. COMPLETION
TPN and Squash shall procure that on the Completion Date:-
3.1 The Resolutions are lawfully passed as special resolutions of the Company;
and
3.2 Squash's and TPN's names are (if not already) respectively entered in the
register of members of the Company as registered holders of the shares
referred to in Recital (B) to this Agreement.
4. WORKING CAPITAL
4.1 Neither of the Shareholders shall be in any way obliged to provide further
funding for the Company or the Business.
4.2 The Shareholders agree that if the Company should require further funding
beyond what can be raised by the Company, this will only be provided by
the further issue of shares in the capital of
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the Company if both of the Shareholders consent to such issue in writing.
5. THE CONSTITUTION OF THE COMPANY
5.1 The Board shall consist of no more than 3 persons and the initial
Directors shall be the following persons who shall be the Board
Representatives of the following Shareholders:-
NAME SHAREHOLDER
Xxxxxx Xxxxxxxx XxxxXxxxxXxx.xxx Plc
Xxxxxxx Xxxxxx XxxxXxxxxXxx.xxx Plc
Xxxxxxx Xxxxxxx Squash Limited
and the parties shall procure that such persons are appointed as directors
on the Completion Date and that any other Directors resign from the Board.
5.2 The Chairman of all Meetings of the Board and of General Meetings of the
Company shall be Xxxxxx Xxxxxxxx (or such other person as shall be
nominated in writing by TPN from time to time) who shall have the casting
vote at all such Meetings.
5.3 The Shareholders hereby agree to exercise their voting rights as
shareholders in the Company in such manner so that at all times following
the Completion Date while they remain members of the Company holding
ordinary share capital the Board shall always comprise one Board
Representative of Squash (which may be Squash itself) and two Board
Representatives of TPN (one of which may be TPN itself).
5.4 Each Board Representative may only be replaced or removed from the Board
by notice in writing given by the party who appointed him.
5.5 Each of the Board Representatives shall be entitled to appoint an
alternate (who shall not be an employee of the Company) to act for him and
in his place in accordance with the Articles. Such appointment can be made
at any time under hand and is not subject to the approval of the Board.
5.6 Not less than 7 days notice in writing shall be given to the Directors of
any Board Meeting unless all the Directors agree to a shorter period of
notice in writing.
5.7 The quorum necessary for the transaction of business at a meeting of the
Directors shall be two, one of whom shall be a Board Representative of
Squash.
6. CONDUCT OF THE COMPANY'S AFFAIRS
The Shareholders shall exercise all rights available to them in relation to the
Company (and any subsidiary of the Company as though it were the Company for the
purpose of the following clauses) and the Company shall do everything necessary
to procure (so far as it is able to do so) that during the term of this
Agreement (save with the prior written consent of both of the Shareholders or of
at least one TPN Board Representative and one Squash Board Representative):-
6.1 the business of the Company consists exclusively of the Business to be
run solely by the Company as soon as practicable;
6.2 the Shareholders are given full opportunity to examine the books and
accounts kept by the Company and are supplied with all relative
information, including monthly management accounts and operating
statistics and such other trading and financial information in such form
as they reasonably require to keep each of them properly informed about
the Business and generally to protect their interests;
6.3 Neither the Company nor any Subsidiary of the Company shall without the
prior written consent of both of the Shareholders:-
6.3.1 create any fixed or floating charge, lien (other than a lien
arising by operation of law) or other encumbrance over the whole or
any part of the undertaking, property or assets of the Company or
of such Subsidiary, except for the purpose of securing the
indebtedness of the Company to its bankers for sums borrowed in the
ordinary and
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proper course of the Business;
6.3.2 borrow any sum of money (except from the Company's bankers in
the ordinary and proper course of the Business);
6.3.3 make any loan or advance or give any credit (other than normal
trade credit) to any Person, except for the purpose of making
deposits with bankers which shall be repayable upon the giving of
no more than seven days' notice];
6.3.4 give any guarantee or indemnity to secure the liabilities or
obligations of any Person (other than a wholly owned Subsidiary of
the Company);
6.3.5 save as provided in clause 11, sell, transfer, lease, assign or
otherwise dispose of a material part of the undertaking, property
and/or assets of the Company or any such Subsidiary (or any
interest therein), or contract so to do otherwise than in the
ordinary and proper course of the Business;
6.3.6 issue any unissued shares for the time being in their respective
capitals or create or issue any new shares except as expressly
permitted by the Company's Articles of Association;
6.3.7 alter any rights attaching to any class of share in the capital
of the Company;
6.3.8 consolidate, sub-divide or convert any of the Company's share
capital or in any way alter the rights attaching thereto;
6.3.9 issue renounceable allotment letters or permit any Person entitled
to receive an allotment of shares to nominate another Person to
receive such allotment except on terms that no such renunciation or
nomination shall be registered unless the renouncee or Person
nominated is approved by the Board; or
6.3.10 create, acquire or dispose of any Subsidiary or of any shares in
any Subsidiary;
6.3.11 enter into any partnership or profit sharing agreement with any
Person;
6.3.12 do or permit or suffer to be done any act or thing whereby the
Company may be wound up (whether voluntarily or compulsorily), save
as otherwise expressly provided for in this Agreement;
6.3.13 issue any options or warrants or debentures or other securities
convertible into shares or debentures or any share warrants or any
options in respect of shares;
6.3.14 acquire, purchase or subscribe for any shares, debentures,
mortgages or securities (or any interest therein) in any company,
trust or other body;
6.3.15 create any contract or obligation to pay money or money's worth to
any member of the Company or to any Holding Company of such member
or to any other Subsidiary or associate of any such member
(including any renewal thereof or any variation in the terms of any
existing contract or obligation) other than on commercial arms
length terms; and
6.3.16 appoint any committee of the Directors or any local board or
delegate any of the powers of the Directors to such committee or
local board.
6.4 the auditors of the Company are Xxxxx Xxxxx or such other firm of
chartered accountants as TPN shall determine;
6.5 the bankers of the Company are HSBC Bank plc or such other major
clearing bank as TPN shall nominate;
6.6 the registered office of the Company shall be at 0xx Xxxxx Xxxxxxxx House,
000 Xxxxxxxx Xxxx, Xxxxxxxx Xxxxxxxxxx X00 0XX or at such other place as
TPN shall require and the Company Secretary shall be such person as TPN
shall reasonably nominate;
6.7 the Company complies with the provisions of its memorandum of
association and the Articles;
6.8 board meetings of the Company are convened, at regular intervals by not
less than 7 days notice in writing accompanied by an agenda specifying the
business to be transacted;
6.9 the Board determines the general policy of the Company (subject to the
express provisions of this Agreement), including the scope of their
respective activities and operations and that the
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Board reserves to itself all matters involving major or unusual
decisions;
6.10 the Company transacts all its business on commercial arms length terms;
6.11 the Company shall not enter into any agreement or arrangement
restricting its competitive freedom to provide and take goods and services
by such means and from and to such persons as it may think fit;
6.12 the Company shall maintain with a well established and reputable insurer
adequate insurance against all risks usually insured against by companies
carrying on the same or similar business and (without prejudice to the
generality of the foregoing) for the full replacement or reinstatement
value of all its assets of an insurable nature;
6.13 the Company shall prepare its accounts on an historical cost basis and
shall adopt such accounting policies as may from time to time be generally
accepted in England and Wales;
6.14 the Company shall prepare such accounts in respect of each accounting
reference period as are required by statute and procure that such accounts
are audited as soon as practicable and in any event not later than 4
months after the end of the relevant accounting reference period;
6.15 the declaration, and payment of all dividends by the Company is at the
entire discretion of the Board but no Shareholder shall be treated more
favourably than any other; and
6.16 all trading losses shall be carried forward by the Company and not
surrendered to TPN.
7. ARTICLES OF ASSOCIATION
7.1 If during the continuance of this Agreement there shall be any conflict
between the provisions of this Agreement and the provisions of the
Articles then during such period the provisions of this Agreement shall
(as between the parties) prevail.
7.2 Nothing herein shall be deemed to constitute an amendment of the Articles
or of any previous articles of association of the Company.
8. NO PARTNERSHIP
Nothing in this Agreement shall constitute or be deemed to constitute a
partnership between any of the parties hereto and none of them shall have any
authority to bind each other in any way.
9. CONFIDENTIALITY UNDERTAKINGS
Each Shareholder hereby UNDERTAKES AND COVENANTS with the other Shareholders and
with the Company separately that he will not at any time without the consent in
writing of the other Shareholders and the Company being first obtained, divulge
to any person or publish or use for his own benefit, (or that of any third
party), take away, conceal, destroy or retain for his or another's advantage or
to the detriment of the Company any information concerning the business,
accounts, finances, customers, processes, suppliers, inventions, trade secrets
or contractual arrangements or any other dealings transactions or affairs of the
Company which may come to his knowledge whether before or after the execution of
this Agreement. This covenant shall continue to apply without limit as to time,
but shall cease to apply to any Shareholder in respect of information or
knowledge which enters the public domain other than through the default of that
Shareholder.
10. COVENANT
The Shareholders agree and mutually COVENANT with each other and with the
Company that they will at all times use and exercise their rights to call and
convene General Meetings of the Company, the votes they control at General
Meetings of the Company, and their right to appoint and remove Directors of the
Company arising under the Articles, under this Agreement or otherwise, to ensure
the performance, maintenance and observance of the terms and the spirit of this
Agreement including the obligations of the Company and the Board and that each
of them will do or procure to be done all such acts, assurances, deed or things
as may be necessary to carry out this Agreement including where necessary
procuring third parties to act appropriately and all of them will use their best
endeavours to
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promote the business of the Company in accordance with the decisions of the
Board.
11. FUTURE SALE
11.1 Squash agrees that if at any time prior to 31 December 2003 TPN procures a
bona fide offer from an unconnected third party to acquire the entire
issued share capital of the Company for a price of ,5m or more and on
terms that Squash will be treated pari passu with TPN then Squash shall
co-operate with TPN to effect such a sale and will accept such offer
PROVIDED THAT:-
(a) the consideration is payable in cash or readily convertible
securities, with only such retention or deferred consideration
element at completion as may be reasonable in the circumstances
of such sale;
(b) no warranties, representations, covenants or indemnities are
required from Squash save as to ownership of shares.
11.2 The parties hereby consent to the sale by the Company (and/or its
subsidiaries if any) of its assets and undertaking to a third party
without the consent of the parties being required PROVIDED THAT:-
(a) the sale is on arms= length commercial terms; and (b) the parties
receive at the time of the sale by way of dividend or other
non-refundable payment a sum equal to their respective percentage
holding of the share capital of the Company.
12. NOTICES
12.1 Any notice required or permitted under the terms of this Agreement or
required by statute, law or regulation shall (unless otherwise provided by
this Agreement or the statute, law or regulation concerned) be in writing
and shall be sufficiently given if forwarded by facsimile, by hand or by
registered post or by first-class recorded delivery post to the Parties as
follows:
12.1.1 In the case of Squash, to its address as shown in this Agreement
(Fax No: 000-000-000-0000) or such other address as Squash may
notify to the other Parties for the purposes of, and in accordance
with, this clause, and also to Xxxxxxx Xxxxxxx, 000 Xxxxxxx Xxxxx
Xxxxx, Xx Xxxxx-Xx-Xxx, Xxxxxxxxxx XX0 0XX (Fax No: 00000-000000);
and
12.1.2 in the case of either TPN or the Company, to its registered office
for the time being or such other address as they may notify to the
other Parties for the purposes of, and in accordance with, this
clause.
12.2 Any such notice shall be in writing in the English language and shall be
deemed to have been received and given:
(a) in the case of delivery by hand, at the time of delivery;
(b) in the case of delivery by registered post or by first-class
recorded delivery post, three days after the date of mailing; and
(c) in the case of facsimile transmission, when sent provided that a
hard copy is sent immediately thereafter by registered post or by
first-class recorded delivery post.
13. APPOINTMENT OF AGENT FOR SERVICE OF PROCESS
13.1 Squash appoints Xxxxxxx Xxxxxxx, 000 Xxxxxxx Xxxxx Xxxxx, Xx Xxxxx-Xx-Xxx,
Xxxxxxxxxx XX0 0XX or such other person resident or having an office in
England or Wales as Squash may from time to time nominate in writing to
the other parties for the purpose (the"AGENT") as agent for service of any
notice of proceedings in the English courts and for the purpose of
receiving any written communication in connection with this Agreement.
13.2 Squash irrevocably agrees that any writ, judgment or other notice of
process or any written communication in connection with this Agreement
shall be sufficiently and effectively served on it (a) if delivered to the
Agent, or (b) in any other manner permitted by law.
13.3 If the Agent ceases to exist or ceases to be resident in or to have an
office in England or Wales
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where process or written communications may be served, in either case for
any reason whatever, Squash undertakes forthwith to appoint some other
person or persons resident or having an office in England or Wales as its
agent for the purposes of his clause and forthwith to notify each
Shareholder and the Company in writing of such appointment.
14. GENERAL
14.1 No Shareholder may assign his or its rights and obligations hereunder
in whole or in part.
14.2 This Agreement shall be read and construed in accordance with the Laws of
England and Wales and the shareholders agree to submit any dispute arising
hereunder to the Courts of England.
14.3 In the event of the death, liquidation or bankruptcy of any of the parties
hereto their respective rights hereunder shall enure for the benefit of,
and their respective obligations shall bind, their successors in title.
14.4 All the Schedules form part of this Agreement.
14.5 This agreement and the Schedules shall constitute the entire agreement and
understanding between the parties with respect to all matters which are
referred to.
14.6 If any term or provision in this agreement shall in whole or in part be
held to any extent to be illegal or unenforceable under any enactment or
rule of law, that term or provision or part shall to that extent be deemed
not to form part of this agreement and the enforceability of the remainder
of this Agreement shall not be affected.
14.7 Upon any transfer of shares in the Company to any party by either of the
Shareholders then the disposing Shareholder shall make it a condition of
the sale that the transferee shall enter into a Deed of Adherence in the
form of the draft set out in Schedule 3.
I N W I T N E S S whereof the parties have executed this Agreement as a Deed the
day and year first before written.
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SCHEDULE 1
WRITTEN RESOLUTION
COMPANY NUMBER : 3668169
IN THE COMPANIES ACTS 1985 TO 1989
UK PROPERTY XXXXXXX.XXX LIMITED
WRITTEN RESOLUTIONS
WE, the undersigned, being all the Members of the above-named Company for the
time being entitled to receive notice of and to attend and vote at General
Meetings of the Company, make the following resolutions which shall effect as
special resolution, and which shall pursuant to section 381A Companies Act 1985
(as amended by the Deregulation (resolution of Private Companies) Order 1996),
for all purposes be as valid and effective as if passed at a general meeting of
the Company duly convened and held:-
SPECIAL RESOLUTIONS
1. That the following numbers of Ordinary shares of ,1.00 in the capital of
the Company be and are hereby allotted to the following parties for the
respective amounts shown below to be satisfied in cash:-
Name of Allottee Number of Ordinary Shares of ,1.00 Amount
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XxxxXxxxxXxx.xxx Plc 560 ,560
Squash Limited 240 ,240
2. That the regulations contained in the printed document submitted to this
meeting, and for the purpose of identification signed by the Chairman
hereof, be approved and adopted as the Articles of Association of the
Company, in substitution and to the exclusion of all the existing articles
thereof.
DATED March 2000
..................................... ...................................
For and on behalf of TPN Holdings Plc For and on behalf of Squash Limited
SCHEDULE 2
DRAFT ARTICLES
COMPANY NUMBER : 3668169
IN THE COMPANIES ACTS 1985 TO 1989
COMPANY LIMITED BY SHARES
NEW ARTICLES OF ASSOCIATION
OF
UK PROPERTY XXXXXXX.XXX LIMITED
(Adopted by Special Resolution
passed on March 2001)
1. Subject as hereinafter provided and except where the same are varied by or
are inconsistent with these Articles the Regulations contained in Table A
in the Companies (Tables A to F) Regulations 1985 (hereinafter called
"Table A") shall apply to this Company.
2. Regulations 23 to 28 inclusive, 40, 54, 57, 64, 65 to 69 inclusive, 73 to
80 inclusive and 91 of Table A shall not apply to the Company, but the
Articles hereinafter contained and the remaining Regulations of Table A,
subject to the modifications hereinafter expressed, shall constitute the
regulations of the Company.
3. In these Articles "THE 1985 ACT" means the Companies Xxx 0000 (and every
statutory re-enactment thereof or modification thereto for the time being
in force).
SHARE CAPITAL
4. The share capital of the Company is ,1,000 divided into 1,000 Ordinary
Shares of ,1.00 each (a "Share" or "Shares") which shall each confer upon
the holders thereof the same rights and shall rank pari passu in all
respects.
VOTING RIGHTS
5. Each Share in the capital of the Company shall entitle the holder
thereof to exercise one vote in respect thereof.
ALLOTMENT OF SHARES
6. Subject to the provisions of Articles 4 and 9 the Directors are not
authorised to exercise the power of the Company to allot shares to the
amount of the authorised but unissued share capital of the Company at
the date of adoption of these Articles. In this Article any reference
to the allotment of Shares shall include a reference to the grant of
any right to subscribe for, or to convert any security into Shares, but
shall not include any reference to the allotment of Shares
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pursuant to such a right.
LIEN
7. Regulation 8 of Table A shall be read and construed as if the words "(not
being a fully paid share)" were deleted therefrom.
TRANSFER OF SHARES
8. (a) All transfers of Shares shall be effected by instrument in writing
in any usual or common form or in such other form as the Directors
may from time to time approve.
(b) The instrument of transfer of any partly paid Shares shall be signed
by or on behalf of the transferor and the transferee.
9. Save as hereinafter provided in this Article, it shall be obligatory for
the Directors to register any duly stamped transfer of a Share or Shares
made pursuant to or permitted by the following sub-clauses of this Article
9 AND it shall also be obligatory for the Directors to refuse to register
any transfer of an Share or Shares not so made or permitted.
(a) The Directors may decline to register any transfer of any Share on
which the Company has a lien. If the Directors refuse to register a
transfer, they shall within two weeks after the date on which the
transfer was lodged with the Company send to the transferor notice of
the refusal.
(b) No Share shall be transferred or otherwise disposed of or encumbered
save pursuant to the provisions of this Article 9.
(c) In the event of any Member of the Company (including any person or
persons entitled to any Share or an interest therein in consequence
of the death or bankruptcy of any person) wishing to dispose of any
Share or Shares or an interest in any Share or Shares in the Company
such Member (hereinafter called "THE TRANSFEROR") shall give notice
in writing (hereinafter called "THE TRANSFER NOTICE") to the
Directors of the Company that he desires to transfer the same. A
Transfer Notice shall specify the number of Shares in which the
Transferor desires to transfer an interest (such Shares in each case
being hereinafter referred to as "THE SALE SHARES"). A Transfer
Notice may contain a provision that unless all of the Sale Shares are
sold by the Company pursuant to the following provisions of this
Article none shall be sold and such provision shall be binding on all
persons. A Transfer Notice shall constitute the Company as the
Transferor's agent for the sale of the Sale Shares (together with all
rights attached thereto at the date of receipt of the Transfer
Notice) according to the provisions hereinafter set out in this
Article;
(d) As soon as reasonably possible after the price for the Sale Shares
has been fixed pursuant to sub-clause (f) of this Article then the
Company shall by notice in writing invite other members holding
Shares to apply in writing to the Company within 21 days of the date
of despatch of such notice (which date shall be specified therein)
for such maximum number of the Sale Shares as he or it shall specify
in such application;
(e) The price to be paid for each of the Sale Shares shall be the
proportionate part of the open market value of the Company which the
number of Sale Shares represents in relation to the number of issued
Shares in the capital of the Company. "OPEN MARKET VALUE" means the
price which shares might reasonably be expected to fetch on a sale by
private treaty and at arm's length by a willing Vendor in the open
market to a single purchaser possessed of all information which a
prudent prospective purchaser of such issued share capital might
reasonably require. In determining the Open Market Value no account
shall in any circumstances be taken of the restrictions on the
transfer of Shares prescribed in this Article 9 or of the fact that
the Sale Shares may represent a majority or a minority interest;
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(f) The Transferor and Directors of the Company as soon as reasonably
possible after the giving of the Transfer Notice shall agree the
price for the Sale Shares in accordance with sub-clause (e) above of
this Article. Provided however that if the Transferor and Directors
shall be unable to agree the price within 90 days of the giving of
the Transfer Notice then an independent Chartered Accountant
(appointed as hereinafter provided) shall be asked to certify (acting
as an expert and not as an arbitrator) the price for the Sale Shares
calculated in the manner aforesaid. The Auditors may be appointed as
such independent Chartered Accountant provided that each Member
consents in writing, whereupon any reference to the Independent
Chartered Accountant shall be a reference to the Auditors. As soon as
the Company receives the Accountant's Certificate it shall furnish a
certified copy thereof to the Transferor;
(g) The independent Chartered Accountant to be appointed for the purpose
of sub-clause (f) above shall be appointed by agreement between the
Transferor and the Directors or in default of agreement, by the
President for the time being of the Institute of Chartered
Accountants in England and Wales upon the application of either the
Transferor or the Directors, and the cost of his appointment and of
his Certificate shall be borne in such manner as he shall direct;
(h) If within the period specified in sub-clause (d) above applications
shall have been received by the Company for any or (except where the
Transfer Notice provided otherwise) all of the Sale Shares (or so
many of them as shall be applied for as aforesaid) the Directors
shall allocate the Sale Shares amongst the applicants and in case of
competition pro-rata (as nearly as possible) according to the nominal
value of the Ordinary Shares in the Company of which they are
registered as holders provided that no applicant shall be obliged to
take more than the maximum number of Sale Shares specified by him as
aforesaid. The Company shall forthwith give notice of such
allocations (hereinafter called an "ALLOCATION NOTICE") to the
Transferor and to the persons to whom the Sale Shares have been
allocated and shall specify in such Allocation Notice the place and
time (being not earlier than 14 and not later than 28 days after the
date of the Allocation Notice) at which the sale of the Sale Shares
so allocated shall be completed;
(i) The Transferor shall be bound against receipt of the purchase price
in respect thereof to transfer the Sale Shares comprised in an
Allocation Notice to the purchaser or purchasers named therein at the
time and place therein specified and if he shall fail to do so the
Chairman of the Company or some other person appointed by the
Directors shall be deemed to have full power to execute complete and
deliver in the name and of on behalf of the Transferor transfers of
the Sale Shares to the purchasers thereof against payment of the
purchase price to the Company. On payment of the price to the Company
the purchaser shall be deemed to have obtained good quittance for
such payment and on execution and delivery of the transfer duly
stamped the Purchaser shall be entitled to have his name entered into
the Register of Members as the holder by transfer of the Sale Shares
comprised in such transfer. The Company shall forthwith pay the price
into a separate bank account in the Company's name and shall hold
such price in trust for the Transferor.
(j) During the 3 months following the expiry of the period of 21 days
referred to in the sub-clause (d) of this Article the Transferor
shall be at liberty to transfer to any person and at any price (not
being less than the price fixed under sub-clause (f) of this Article)
any Sale Share not allocated by the Directors in an Allocation Notice
provided that if the Transferor stipulated in his Transfer Notice
that unless all the Sale Shares comprised therein were sold pursuant
to this regulation none should be so sold the Transferor shall not be
entitled (save with the written consent of all the other members of
the Company)
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to sell hereunder only some of the Sale Shares comprised in his
Transfer Notice; and
(k) The Directors on receipt of the written agreement of the holders of
all the Shares in the capital of the Company shall register a
transfer of shares notwithstanding that the regulations contained in
sub-clauses (b) to (j) inclusive of this Article shall not have been
complied with.
ALTERATION OF CAPITAL
10. In accordance with s.91 of the 1985 Act, s.89(1) and s,90(1) to (6)
inclusive of the 1985 Act is excluded from applying to the Company.
Subject to any direction to the contrary that may be given by the
Company by Special Resolution, any unissued shares of the Company
(whether forming part of the original or any increased capital) shall,
before allotment or issue, be offered (either at par or at a premium
but in any case at the same price per share) in the first instance to
the holders of shares in the Company in proportion as nearly as the
circumstances shall admit to the number of shares held by each of them
respectively. The offer shall be made by notice in writing specifying
the number of shares offered, and limiting a time (being not less than
twenty-one days) within which the offer, if not accepted, shall be
deemed to be declined, and after the expiration of that time, or on the
receipt of an intimation from any persons to whom the offer is made
that he declines to accept the shares offered, the Directors may
thereafter dispose of the shares which shall not have been accepted in
accordance with Article 6. Every other provision of these Articles
which would permit the issue of shares otherwise than in accordance
with this Article shall be subject to the provisions of this Article
and shall be treated as modified accordingly.
GENERAL MEETINGS
11. In every Notice convening a General Meeting of the Company there shall
appear with reasonable prominence a statement that a Member entitled to
attend and vote is entitled to appoint a proxy to attend and vote instead
of him and that such proxy need not also be a member.
12. Proxies may be deposited at the Registered Office of the Company at any
time before the time of the Meetings for which they are to be used unless
otherwise specified in the notice convening such Meeting. Regulation 56 of
Table A shall be modified accordingly.
13. No business shall be transacted at any general meeting unless a quorum of
Members is present. Two members in person or by proxy shall be a quorum.
If within half an hour from the time appointed for any general meeting or
any adjournment thereof a quorum is not present the meeting shall be
dissolved. A corporation being a member shall be deemed to be personally
present if represented by its representative duly authorised.
14. For the purposes of Regulation 53 of Table A signature in the case of a
corporate body which is a Member shall be sufficient if made by a Director
or member of the governing body thereof or by its Secretary.
15. A poll may be demanded by the Chairman of a General Meeting or by any
Member present in person or by proxy and Regulation 45 of Table A shall be
modified accordingly.
16. The Chairman of a general meeting shall not be entitled to a second or
casting vote.
VOTES OF MEMBERS
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17. On a show of hands and on a poll each Member present in person or by proxy
shall have the number of votes designated by Article 5 hereof for every
Share of which he is the holder; a corporation being a member shall be
deemed to be personally present if represented by its representative duly
authorised.
DIRECTORS
18. (a) Until otherwise determined by the Company in General Meeting the
number of Directors shall be a minimum of two (other than
alternate Directors).
(b) Except to the extent herein mentioned, all Directors shall be
considered as one Board of Directors without any distinction.
19. Each Director shall have the power to appoint (i) any other Director or
(ii) any person not disqualified from being a Director of the Company
to act as his alternate Director during his absence and at his
discretion to remove such alternate Director, and on such appointment
being made the alternate Director shall, except as regards remuneration
and the power to appoint an alternate, be subject in all respects to
the terms and conditions existing with reference to the other Directors
of the Company, and each alternate Director, while so acting, shall be
entitled to receive notices of all meetings of the Directors and shall
exercise and discharge all the functions, powers, and duties of the
Director whom he represents including that of counting in a quorum at
any such meeting of Directors. An alternate Director shall ipso facto
cease to be an alternate Director if his appointor ceases for any
reason to be a Director. Every such alternate shall be an officer of
the Company and shall not be deemed to be an agent of the Director
appointing him.
BORROWING POWERS
20. The Directors without prejudice to their general powers may in the name
and on behalf of the Company and from time to time at their discretion
borrow from themselves or from others any sum or sums of money for the
purposes of the Company without limit as to amount, and mortgage or
charge the undertaking property and uncalled Capital of the Company or
any part thereof as security for any debt liability or obligation of
the Company or of any third party and that upon such terms and in such
manner as they think fit.
POWERS AND DUTIES OF DIRECTORS
21. A Director who is in any way whether directly or indirectly interested
(whether through persons connected with him as defined in s.346 of the
1985 Act or otherwise) in a contract or proposed contract with the
Company shall declare the nature of his interest at a meeting of the
Directors in accordance with s.317 of the 1985 Act. A Director may vote
in respect of any contract or arrangement in which he is interested and
if he does so vote his vote shall be counted and he may be counted in
ascertaining whether a quorum is present at any meeting at which any
such contract or arrangement shall come before the Directors for
consideration and regulation 94 of Table A shall be modified
accordingly.
PROCEEDINGS OF DIRECTORS
22. The Directors may meet together for the despatch of business, adjourn
and otherwise regulate their meetings as they think fit. Questions
arising at any meeting shall be decided by a majority of votes. The
Chairman shall be entitled to a casting vote on a resolution or
question which shall give rise to an equality of votes. A Director
may, and the Secretary on the requisition of a Director shall, at any
time summon a meeting of the Directors. Regulation 88 of Table A shall
be modified accordingly.
23. Unless all of the Directors otherwise agree, at least 7 days notice of
every meeting of the
-13-
Directors, setting out the business to be transacted thereat, shall be
given to every Director at the address from time to time notified by him
to the Secretary of the Company for that purpose and no business except
that in respect of which due notice has been given shall be transacted at
that meeting save with the consent of all of the Directors or their
alternates.
24. The quorum necessary for the transaction of the business of the Directors
shall be two Directors present in person or by their duly appointed
Alternate Director and such meetings may be held by telephone provided
that the Directors comprising the necessary quorum are in verbal
communication with each other.
25. The meetings and proceedings of any committee of the Directors consisting
of two or more members shall be governed by the provisions of these
Articles regulating the meetings and proceedings of Directors, so far as
the same are applicable and are not superseded by any regulations made by
the Directors under Regulation 72 of Table A.
26. A resolution in writing, signed by at least two of the Directors or by
their duly appointed alternate Directors shall be as effective as a
resolution passed at a meeting of the Directors duly convened and held and
such resolution in writing may consist of several documents in like form
each signed by one or more of such Directors.
INDEMNITY
27. Every Director, Managing Director, Agent or Secretary of the Company
shall be entitled to be indemnified out of the assets of the Company
against all losses or liabilities which he may sustain or incur in or
about the execution of the duties of his office or otherwise in
relation thereto, including any liability incurred by him in defending
any proceedings whether civil or criminal, in which judgment is given
in his favour or in which he is acquired, or in connection with any
application under s.727 of the 1985 Act in which relief is granted to
him by the Court, and no director or other officer shall be liable for
any loss, damage, or misfortune which may happen to or be incurred by
the Company in the execution of the duties of this office or in
relation thereto. But this Article shall only have effect in so far as
its provisions are not avoided by s.310 of the 1985 Act.
-14-
SCHEDULE 3
DRAFT DEED OF ADHERENCE
THIS DEED OF ADHERENCE is made on
----------------------
B E T W E E N:-
-------------
(1) TOWN XXXXXXXX.XXX PLC (Registered in England No. 3608347 ) whose
-----------------------
registered office is situated at Xxxxxx Xxxxx, Xxxx Xxxx, Xxxxx,
Xxxxxxxxx XX00 0XX ("TPN");
(2) SQUASH LIMITED (Registered in the Commonwealth of the Bahamas
---------------
No. ) whose registered office is situate
at (ASquash@); and
(3) of
------------------------
("the New Member").
W H E R E A S:-
-------------
(A) TPN and Squash are parties to an Agreement dated [ ] February 2001 ("the
Shareholders Agreement") for the purpose of regulating their relationships
with each other with regard to UK Property Xxxxxxx.Xxx Limited ("the
Company")
(B) [TPN] [Squash] has agreed to transfer * shares in the capital of the
Company to the New Member.
(C) It is a requirement of the Shareholders Agreement that before a transfer
of the said shares is registered in the books of the Company the proposed
Transferee shall enter into a document in the form of this Deed.
NOW THIS DEED WITNESSETH as follows:-
------------------------
The New Member HEREBY COVENANTS with TPN and with Squash to be bound by all the
provisions of the Shareholders Agreement and to duly perform and observe all the
conditions covenants stipulations and provisions which under the Shareholders
Agreement ought from time to time to be performed and observed by the New
Member.
I N W I T N E S S whereof the parties have executed this document as a Deed the
day and year first before written.
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SIGNED AS A DEED AND DELIVERED by )
------------------------------
TOWN XXXXXXXX.XXX PLC acting by )
---------------------
two Directors or one Director and the Secretary )
Director
Director/Secretary
THE COMMON SEAL of SQUASH LIMITED was )
--------------- --------------
hereunto affixed in the presence of:- )
Director
Director/Secretary
SIGNED AS A DEED AND DELIVERED by )
------------------------------
UK PROPERTY XXXXXXX.XXX LIMITED acting )
-------------------------------
by two Directors or one Director and the Secretary )
Director
Director/Secretary
-16-
