The Companies Act 2006 requires the Company to provide a Directors' Report for Vesuvius plc, for the period since incorporation, 17 September 2012, to 31 December 2012. In order to assist shareholders, the Company has included information on the activities of the Company for the full year 2012. The Directors therefore submit their Annual Report together with the audited accounts of the Group and of the Company, Vesuvius plc, registered in England and Wales No. 8217766, for the year ended 31 December 2012 and for the period from 17 September to 31 December 2012, respectively. Vesuvius plc was originally registered with the name Vesuvius Technologies plc on 17 September 2012 and changed its name to Vesuvius plc on 18 October 2012.
The message from our Chairman, the message from our Chief Executive, the Operating Review, the Financial Review, the Corporate Governance Report (including the Directors' Remuneration Report), the Principal Risks and Uncertainties, the section on Vesuvius's business model, the Key Performance Indicators and Board of Directors sections of the Annual Report, together with the information on financial risk management objectives and policies contained in notes 22 and 30 to the consolidated financial statements, are each incorporated by reference into, and form part of, this Directors' Report. This Directors' Report also represents the management report for the purpose of compliance with DTR 4.1.8R of the UK Listing Authority disclosure rules.
This Annual Report contains certain forward-looking statements with respect to the operations, performance and financial condition of the Group. By their nature, these statements involve uncertainty since future events and circumstances can cause results and developments to differ materially from those anticipated. The forward-looking statements reflect knowledge and information available at the date of preparation of this Annual Report and the Company undertakes no obligation to update these forward-looking statements. Nothing in this Annual Report should be construed as a profit forecast.
Vesuvius is a global leader in metal flow engineering, developing, manufacturing and marketing mission-critical advanced ceramic consumable products and systems to demanding applications, primarily in the global steel and foundry industries and in industries that require refractory materials for high temperature, abrasion-resistant and corrosion-resistant applications such as the aluminium, cement and glass industries.
The Company is required by the Companies Act 2006 to provide a fair review of the development and performance of the Company since incorporation, its financial position at the end of the year and likely future developments in the Group's business, together with information on environmental matters and employees and a description of the principal risks and uncertainties facing the Group. The information which satisfies these requirements is to be found in the Message from our Chief Executive; the Operating Review; the Financial Review; the section on Vesuvius' business model; the Key Performance Indicators; this Directors' Report; the Corporate Governance Report; and the Principal Risks and Uncertainties section.
Information on the business environment in which the Group operates, including the factors that are likely to impact the future prospects of the Group, is included in the message from our Chief Executive and the Operating Review. The principal risks and uncertainties that the Group faces throughout its global operations are shown within the Principal risks and uncertainties section. The financial position of the Group, its cash flows, liquidity position and debt facilities are described in the Financial Review. In addition, notes 22 and 30 to the consolidated financial statements set out the Group's objectives, policies and processes for managing its capital; financial risks; financial instruments and hedging activities; and its exposures to credit, market (both currency and interest rate-related) and liquidity risk. Further details of the Group's cash balances and borrowings are included in notes 15, 16 and 30 to the consolidated financial statements.
The Directors have prepared cash flow forecasts for the Group for a period in excess of 12 months from the date of approval of the 2012 financial statements. These forecasts reflect an assessment of current and future end-market conditions and their impact on the Group's future trading performance. The forecasts show that the Group will be able to operate within the current committed debt facilities and show continued compliance with the Company's financial covenants. On the basis of the exercise described above and the Group's available committed debt facilities, the Directors consider that the Group and Company have adequate resources to continue in operational existence for the foreseeable future. Accordingly, they continue to adopt a going concern basis in preparing the financial statements of the Group and the Company.
Prior to the demerger of Cookson Group plc, the Boards of Alent plc and Vesuvius plc stated that it was their intention, subject to completion of the demerger, general market conditions and trading performance, to recommend final dividends for 2012 that aggregated to 15 pence per Cookson share. Vesuvius plc stated its intention to pay a final 2012 dividend of 9.5 pence per Vesuvius share, and Alent plc its intention to pay a final dividend of 5.5 pence per Alent share. In line with this stated intention, the Board is recommending a final dividend in respect of 2012 of 9.5 pence per ordinary share which, if approved, will be paid on 27 June 2013 to shareholders on the register at 17 May 2013.
An interim dividend of 7.50 pence (2011: 7.25 pence) per Cookson ordinary share was paid on 15 October 2012 to Cookson shareholders.
Accountability and audit
A responsibility statement of the Directors and a statement by the Auditor about its reporting responsibilities can be found in the Statement of Directors' Responsibilities and the Independent Auditor's report respectively. The Directors fulfil the responsibilities set out in their statement within the context of an overall control environment of central strategic direction and decentralised operating responsibility.
Disclosure of information to the auditor
As at the date of this report, so far as each Director of the Company is aware, there is no relevant audit information of which the Company's Auditor is unaware and each Director hereby confirms that they have taken all the steps that they ought to have taken as a Director in order to make themselves aware of any relevant audit information and to establish that the Company's Auditor is aware of that information.
Resolutions for the reappointment of KPMG LLP as Auditor of the Company and to authorise the Directors to determine its remuneration are to be proposed at the AGM.
The current Directors of the Company are Ms Hinkley, who was appointed on 3 December 2012, Ms Connors who was appointed on 1 March 2013, and Messrs Gardell, Hewitt, McDonough, Oosterveld, O'Shea, Sussens and Wanecq, all of whom were appointed on 31 October 2012. Messrs Elliston and Malthouse served as the initial Directors of the Company from the date of incorporation to 31 October 2012. Biographical information for all the current Directors of the Company is given in the Board of Directors. Messrs Oosterveld and Sussens intend to retire as Directors of Vesuvius plc immediately following the 2013 Annual General Meeting. All other Directors will retire at the AGM and offer themselves for election. Further information on the contractual arrangements of the Executive Directors is given within the Directors' remuneration report. The Non-executive Directors do not have service agreements.
Remuneration of the chairman and non-executive directors
The Board considers the remuneration policy for the Non-executive Directors. Non-executive Directors' fees are £45,000 per annum. Supplementary fees of £15,000 per annum are payable to the Chairmen of the Audit and Remuneration Committees. A supplementary fee of £5,000 per annum is also payable to the Senior Independent Director.
The Chairman is paid a fee of £185,000 per annum. The Chairman's remuneration is a matter for the Remuneration Committee and it will be subject to periodic review. Neither the Chairman, who is not an Executive Director, nor the other Non-executive Directors are members of the Group's pension plans, nor do they participate in the Group's incentive schemes.
Annual general meeting
The Annual General Meeting of the Company will be held at The Lincoln Centre, 18 Lincoln's Inn Fields, London WC2A 3ED on Tuesday 4 June 2013 at 10.00 am. The notice of meeting is contained within the AGM circular.
Corporate social responsibility
Vesuvius recognises that its operations impact a wide community of stakeholders, including investors, employees, customers, business associates and local communities, and that appropriate attention to the fulfilment of its corporate responsibilities can enhance overall performance. In structuring its approach to the various aspects of corporate social responsibility, the Company takes account of guidelines and statements issued by stakeholder representatives and other regulatory bodies from around the world. Social, environmental and ethical matters are reviewed by the Board, including the impact such matters may have on the Group's management of risk.
Particular emphasis is focused on the following areas:
- Code of Conduct: requiring all Vesuvius' businesses and employees to comply with the highest standards of legal and ethical behaviour.
- Health, Safety and Environment: protecting the health and safety of our employees, contractors, customers and the general public and reducing energy consumption and waste in our operations.
- Products and Services: developing innovative products and services which promote sustainability in our customers' production processes and products.
Health, safety and environment ("hs&e")
Vesuvius regards HS&E matters as mainstream management responsibilities. The Board has overall responsibility for the Vesuvius HS&E policy and for monitoring its implementation. Executives and line managers at all levels are directly responsible through the normal management structure for HS&E matters in the operations under their control. Particular emphasis is focused on the following areas:
- Safety Performance: work-related injuries and illnesses.
- Regulatory Compliance: compliance with permitted air, water, waste and noise emissions criteria.
- Energy Usage: reducing electricity and gas consumed in our operations and hence carbon dioxide ("CO2") emissions.
Regulatory actions against Vesuvius companies have been at a low level for several years. This is indicative of the emphasis on continuous HS&E performance improvement across Vesuvius in relation to statutory obligations. A small number of enforcement notices were issued to Group companies in 2012, including several that assessed minor penalties.
Like many manufacturers, some Group companies have potential environmental liabilities because of past operations at their current or former sites. Where remediation is required, we work with external specialists and with government authorities to ensure that remediation is conducted effectively and efficiently.
A number of Vesuvius work activities are undertaken in higher risk locations such as steel mills or other customer-controlled facilities. Such environments prove particularly dangerous for all personnel engaged in such facilities. Vesuvius and its customer Corus Steel, were recently prosecuted as a consequence of one of Vesuvius' employees being fatally injured in 2008 at a Corus facility. Employee safety remains Vesuvius' greatest priority. The initiative "Safety Breakthrough" was launched after the sad loss of Kristian Norris, to facilitate the elimination of severe work-related accidents. Vesuvius remains committed to achieving world-class safety performance across its business activities.
Code of conduct
Vesuvius has a Code of Conduct ("the Code"), which has been distributed throughout the Group in over 25 languages and by which all our businesses are required to operate. The Code emphasises the Group's commitment to compliance with the highest standards of legal and ethical behaviour. The Code is reproduced in full on the Company's website — www.vesuvius.com. The Code sets out clear and simple principles covering: Customers, Products and Services; Employees; Investors; Society and Local Communities; Health, Safety and the Environment; Conflicts of Interest; and Competitors.
Long-term customer satisfaction is recognised as being essential to the attainment of Group goals, as is maintaining a reputation for integrity in all business and other dealings both with customers and suppliers. The Code defines how we must compete vigorously and honestly.
The Group is committed to the highest standards of corporate governance and transparent investor communication. The Group seeks to be a good corporate citizen wherever it conducts business, to observe all national and local laws and take into account regional and local concerns, customs and traditions.
The Code requires all employees, officers and Directors to have a duty of loyalty to the Group and personal interests that do, may or might appear to conflict with Group interests must be avoided at all times.
A fundamental concept embodied in the Company's Code of Conduct is that Vesuvius' goals can only be met through the efforts of its employees. Vesuvius recognises that job satisfaction requires working environments that motivate employees to be productive and innovative and provide opportunities for employee training and development to maximise personal potential and develop careers within the Group. Vesuvius is managed on a decentralised basis and it is the responsibility of the Vice President of Human Resources, together with the relevant operational managers, to adopt employment policies and practices that best suit the size, style and geographical location of their operations. This management structure allows the Group's operations to respond competitively to changes in the marketplace and to develop and retain a strong sense of identity, whilst benefiting from being a part of a major international group.
Vesuvius values the involvement of its employees and keeps them informed on matters affecting them as employees and factors relevant to Group performance. It is established policy throughout Vesuvius that decisions on recruitment, career development, training, promotion and other employment related issues are made solely on the grounds of individual ability, achievement, expertise and conduct. These principles are operated on a non-discriminatory basis, without regard to race, colour, nationality, culture, ethnic origin, religion, sex, sexual orientation, age, disability or any other reason not related to job performance or prohibited by applicable law. Vesuvius gives full and fair consideration to applications for employment from disabled persons. Should an employee become disabled during their employment with Vesuvius, every effort is made to enable them to continue their service with the Group.
In each country in which the Group operates, the pension arrangements in place are considered to be consistent with good employment practice in that particular area. Independent advisers are used to ensure that the plans are operated in accordance with local legislation and the rules of each plan. Group policy prohibits direct investment of pension fund assets in the Company's shares. Outside the UK, the US, Germany and Belgium, the majority of pension plans in the Group are of a defined contribution nature.
The Group's UK defined benefits plan (the "UK Plan") and the main US defined benefits plan are closed to new entrants and have ceased providing future benefits accrual, with all eligible employees instead being provided with benefits through defined contribution arrangements.
Cookson Group plc was the principal employer of the UK Plan. Following the demerger, the UK Plan remained with Vesuvius and all pension liabilities of the Alent employers who participated in the UK Plan immediately prior to the demerger were discharged in full. Cookson had agreed, with the Trustee of the UK Plan, a mitigation package in light of the loss of support from the Alent participating employers. That mitigation package comprised a £38m payment to the UK Plan. See note 31 to the consolidated financial statements for further information.
For the Group's closed UK Plan a Trustee Board exists comprising employees, former employees and an independent trustee. The Board currently comprises seven trustee directors, of whom three are member nominated. The administration of the plan is outsourced. The Company is mindful of its obligations under the Pensions Act 2004 and of the need to comply with the guidance issued by the Pensions Regulator. Regular dialogue is maintained between the Company and the Trustee Board of the UK Plan to ensure that both Company and Trustee are apprised of the same financial and other information about the Group and the UK Plan. This is pertinent to each being able to contribute to the effective functioning of the UK Plan. The Company currently has in place a schedule of contributions, agreed with the Trustee Board, which aims to reduce to zero the deficit existing on the UK Plan as at 31 December 2009 by February 2016. The adequacy of this schedule of contributions will be monitored over time, so as to assess the need for it to be modified in the light of changes in the deficit position.
The Group's worldwide net pension deficit at 31 December 2012 was £69m (31 December 2011: £59m). The increase arose largely as a result of a reduction in the applicable interest rates used to value liabilities.
The offer of enhanced transfer values to deferred members of the UK Plan, launched in 2011, was successfully completed in the first half of 2012. In total 550 members took advantage of the scheme and, as a result, longevity and investment risk have been eliminated in respect of £50m (c.10%) of Vesuvius' total UK pension liabilities. On 19 July 2012, the Trustee of the UK Plan and Pension Insurance Corporation announced that they had signed a pension insurance buy-in agreement covering all of the pensioner members of the UK Plan. This eliminates inflation, interest rate, investment and longevity risk in respect of around 60% of Vesuvius' total UK pension liabilities. Both the enhanced transfer offer and pensioner insurance buy-in are further steps in the ongoing strategy of de-risking the Group's defined benefit pension arrangements.
Current active employees in the UK are offered membership of a defined contribution plan, which is operated on a contract basis, with oversight by a governance committee.
All US retirement plan assets are held in trust for the exclusive benefit of plan participants and their beneficiaries. An independent financial institution acts as the Trustee. The trust assets are protected by law and by Federal Government Regulation and are subject to annual audit by an independent accountant, the Internal Revenue Service and the Department of Labor. Further details of pension arrangements are given in note 31. In 2012, 67% of the deferred pensioners in the US defined benefit pension plan accepted an offer of a lump sum payment in full and final settlement of the Group's pension liability to them, thus eliminating all future risks relating to these liabilities.
No donations were made by the Company in the UK for charitable purposes in 2012. In accordance with Company policy, no political donations were made in 2012.
Creditor payment policy
Each operating company in the Group is responsible for agreeing the terms and conditions under which business transactions with their suppliers are conducted. It is Group policy that payments to suppliers are made in accordance with these terms, provided that the supplier is also complying with all relevant terms and conditions.
In the accounts of the Company as at 31 December 2012, the number of days' purchases outstanding was 21.
Essential contracts or arrangements with customers, contractors and suppliers
The Company is required to disclose any contractual or other arrangements with customers, contractors and suppliers which it considers are essential to its business. The Company has a number of contractual arrangements in support of its business activities. Whilst the loss of some of these arrangements may cause temporary disruption, none is considered to be essential in the context of Vesuvius' business as a whole.
Change of control provisions
The terms of the Group's committed bank facility and US Private Placement Loan Notes contain provisions entitling the counterparties to exercise termination or other rights in the event of a change of control on takeover of the Company. A number of other arrangements to which the Company and its subsidiaries are party, such as other debt arrangements and share incentive plans, may alter or terminate on a change of control in the event of a takeover. In the context of the Group as a whole, these other arrangements are not considered to be significant.
Post balance sheet events
On 27 March 2013, the Group announced that it had entered into an agreement with Heimerle + Meule GmbH, a subsidiary of L. Possehl & Co, mbH ("Possehl")to sell the European Precious Metals Processing business for a consideration of euro56.8m. The cash consideration will be subject to closing balance sheet adjustments. Completion, which is expected by the end of the first half of 2013, will be subject to conditions including approval by the European Commission and by the Supervisory Board of Possehl.
Demerger and share capital
During the fourth quarter of 2012 Cookson Group plc demerged into two new businesses, Vesuvius plc and Alent plc. Vesuvius plc, which became the new holding company of Cookson Group (the Engineered Ceramics and Precious Metals Processing divisions), and Alent plc, which became the new holding company of the Performance Materials division. This resulted in Cookson shareholders holding shares in these two new listed companies, on the basis of one Vesuvius share and one Alent share for each Cookson Share that they held.
The demerger was effected through the following steps:
- Prior to the demerger, Cookson Group underwent a reorganisation which involved, amongst other things, the transfer of the various Cookson Group subsidiaries which held the Performance Materials division business to a single holding company, Alent Investments Limited. Alent Investments Limited was subsequently transferred to Alent plc as part of the Vesuvius capital reduction, as further described below.
- A Scheme of Arrangement was then effected. This resulted in a new holding company, Vesuvius plc, being inserted as the holding company of Cookson Group. Cookson shareholders received one Vesuvius share in respect of each Cookson share held by them at the Scheme Record Time. Vesuvius shares were admitted to the premium listing segment of the Official List and to trading on the London Stock Exchange's main market for listed securities at 8.00am on 17 December 2012.
- Following the Scheme becoming effective, Vesuvius plc effected a reduction and repayment of capital in order to implement the demerger itself. The repayment of capital was satisfied by the transfer of Alent Investments Limited, the holding company of the Performance Materials division, to Alent plc. In consideration for such transfer, Alent plc allotted and issued to Vesuvius shareholders one Alent share for each Vesuvius share held at the Demerger Record Time. Alent shares were admitted to the premium listing segment of the Official List and to trading on the London Stock Exchange's main market for listed securities at 8.00am on 19 December 2012.
Prior to the demerger, the share capital of Vesuvius plc consisted of one ordinary share with a par value of £1 (the subscriber share) and 50,000 Redeemable Preference Shares of £1 each. As part of the demerger, Vesuvius plc issued 278,448,752 Vesuvius shares, credited as fully paid, to Cookson shareholders on the basis of one Vesuvius Share for every Cookson Share held at the scheme record date. The one Vesuvius Subscriber Share of £1 was then converted into a Vesuvius Deferred Share of £1.
As at the date of this report, the Company had an issued share capital of 278,485,071 ordinary shares of 10p each, being the total number of Vesuvius plc shares with voting rights. The Company also has one Deferred Share of £1 and 50,000 Redeemable Preference Shares in issue.
Further information relating to the Company's issued share capital can be found in note 7 to the Company financial statements.
Resolutions giving the Directors the authority to allot further shares and make allotments of shares to persons other than existing shareholders in certain circumstances will be proposed at the AGM.
Apportionment of tax base cost of cookson group plc shares between alent plc shares and vesuvius plc shares
Based on the share prices of Alent plc and Vesuvius plc on 19 December 2012, a shareholder's base cost in Cookson Group plc shares for UK capital gains tax purposes, and also for US federal income tax purposes, will be allocated 48.87% to Alent plc and 51.13% to Vesuvius plc. US shareholders are referred to IRS Form 8937 for more information.
Vesuvius operates a number of share-based incentive plans which have been carried over from Cookson Group plc (further details about these are given in the Directors' Remuneration Report). For the majority of these plans the Group can satisfy entitlements either by the acquisition of existing shares or by the issue of new shares. Existing shares are held in an employee share ownership trust ("ESOP"). The trustee of the ESOP purchases shares in the open market as required, to enable the Group to meet liabilities for the provision of existing shares to satisfy awards that vest. The trustee does not register votes in respect of these shares and has waived the right to receive any dividends.
In 2012 the trustee purchased 2.7 million £1 ordinary shares in Cookson Group plc with a nominal value of £2.7m at a cash cost of £17.9m, and was allotted a further million 1.9 ordinary shares at a nominal value cost of £1.9m to satisfy the actual and potential vesting of awards under the Group's share-based payment plans (see note 10 to the Company financial statements).
Adjustments were made to outstanding share-based incentives as appropriate following the demerger of Cookson Group, including to the number of shares granted under options and awards and any relevant performance conditions. Such adjustments were made in accordance with the rules of the relevant plans. Participants in the Cookson Group Executive Share Option Scheme were notified in February 2013 that, under the rules of this scheme, they had one month in which to exercise their outstanding options following the demerger. The Cookson shares that they acquired were compulsorily exchanged for Vesuvius shares pursuant to a new article which was incorporated into the articles of association of Cookson Group plc as part of the demerger. The number of Vesuvius shares which they acquired was increased to reflect the fact that they were not able to acquire any Alent shares. 36,319 ordinary shares in Vesuvius plc have been issued since the year-end in relation to the exercise of options granted under the Cookson Group plc share option schemes.
Additional information for shareholders
Set out below is a summary of certain provisions of the Company's current Articles of Association ("Articles") and applicable English law concerning companies (the Companies Act 2006 (the "Companies Act")). This is a summary only and the relevant provisions of the Articles or the Companies Act should be consulted if further information is required.
Authority for purchase of own shares
Subject to the provisions of Company law and any other applicable regulations, the Company may purchase its own shares. At the General Meeting of the Company held on 31 October 2012 the initial Vesuvius shareholder gave authority to the Company to make market purchases of up to 27,835,743 Vesuvius ordinary shares, representing 10% of the Company's expected issued ordinary share capital immediately after the Demerger. As at the date of this report, the Company has made no such purchases under this authority. The Directors believe it advisable to seek renewal of this authority at the forthcoming AGM. The Company's Articles specify that, subject to the authorisation of an appropriate resolution passed by a general meeting of the Company, Directors can allot relevant securities under Section 551 of the Companies Act, up to the aggregate nominal amount specified by that Act. In addition, the Articles state that the Directors can seek the authority of shareholders in general meeting to allot equity securities for cash without first being required to offer such shares to existing ordinary shareholders in proportion to their existing holdings in connection with a rights issue and in other circumstances up to an aggregate nominal amount as specified in Section 561 of the Companies Act.
Transfer of shares
All transfers of shares which are in certificated form may be effected by transfer in writing in any usual or common form or in any other form acceptable to the Directors and may be under hand only. The instrument of transfer must be signed by or on behalf of the transferor and (except in the case of fully paid shares) by or on behalf of the transferee. The transferor will remain the holder of the shares concerned until the name of the transferee is entered in the register of members.
Uncertificated shares may be transferred in accordance with the Uncertificated Securities Regulations 1995, transfers being effected by means of a Relevant System (as defined in such Regulations).
The Directors may decline to recognise any instrument of transfer, relating to shares in certificated form, which is:
- not in respect of only one class of shares; or
- not lodged (duly stamped if required) at the place where Vesuvius plc's register is located accompanied by the relevant share certificate(s), and such other evidence as the Directors may reasonably require to show the right of the transferor to make the transfer (and, if the instrument of transfer is executed by some other person on his behalf, the authority of that person so to do). In the case of a transfer by a recognised clearing house, or by a nominee of a recognised clearing house or of a recognised investment exchange, the lodgement of share certificates will only be necessary if and to the extent that certificates have been issued in respect of the shares in question.
The Directors may also, in the case of shares in certificated form, in their absolute discretion refuse to register any transfer of shares (not being fully paid shares or, broadly, shares which are being transferred from a person resident in the US holding the shares in any manner described in Rule 12g3-2(a)(1) of the US Securities Exchange Act of 1934 (a "US Holder") to a person who is a US Holder) provided that such discretion may not be exercised in such a way as to prevent dealings in the shares of that class from taking place on an open and proper basis.
The Directors may also decline to recognise any allotment or transfer of shares (whether fully paid or not) which is in favour of more than four joint holders. If the Directors refuse to register an allotment or transfer, they must within two months after the date on which (a) the letter of allotment or transfer was lodged with the Company; or (b) the operator instruction was received by the Company (in the case of shares held in uncertificated form), send to the allottee or transferee notice of the refusal.
The Articles contain certain restrictions on the number of US persons who hold shares in the Company so as to prevent the Company from having obligations under the US Securities Exchange Act of 1934.
Subject to the Company's Articles generally and to any special rights or restrictions attached to any class of shares, at a general meeting, every shareholder who is present in person and every duly appointed proxy has one vote on a show of hands, and on a poll every shareholder who is present in person or by proxy has one vote for every ordinary share of which he is the holder. A shareholder entitled to attend and vote at a general meeting is entitled to appoint a proxy or proxies to exercise all or any of his rights to attend and speak and vote in his place. A shareholder may appoint more than one proxy in relation to a general meeting provided that each proxy is appointed to exercise the rights attached to a different share or shares held by the shareholder. Proxies need not be shareholders of the Company. For the purposes of determining which persons are entitled to attend or vote at a meeting and how many votes such person may cast, the Company may specify in the notice of the meeting a time, not more than 48 hours before the time fixed for the meeting, by which a person must be entered on the register of members in order to be entitled to attend or vote at the meeting.
No shareholder will, unless the Directors otherwise determine, be entitled in respect of any share held by him, to vote either personally or by proxy at a general meeting, or to exercise any other right conferred by membership in relation to general meetings, if any call, or other sum presently payable by him to the Company in respect of that share, remains unpaid; or he, or any person who appears to be interested in the shares held by him, has been served with a notice pursuant to section 793 of the Companies Act, and is in default for the prescribed period. In the case of joint holders of shares, only the vote of the senior holder who votes (and any proxies duly authorised by him) may be counted. For this purpose, the senior holder of a share shall be determined by the order in which the names of the joint holders stand in the register of members.
Restrictions on shares
The Board may withhold payment of all or any part of dividends or other moneys payable in respect of the Company's shares from a person with 0.25% interest or more if such person has been served with a notice after failure to provide the Company with information concerning interest in those shares required to be provided under the Companies Act.
Variation of rights
Whenever the share capital of Vesuvius plc is divided into different classes of shares, the special rights attached to any class may be varied or abrogated, subject to the provisions of the Companies Act, either (a) with the consent in writing of the holders of three-quarters in nominal value of the issued shares of that class, or (b) with the sanction of a special resolution passed at a separate meeting of the holders of the shares of that class. At every separate meeting, the necessary quorum is two persons holding, or representing by proxy, not less than one-third in nominal value of the issued shares of the class (but at any adjourned meeting any holder of shares of the class present, in person or by proxy, will be a quorum). Any holder of shares of the class present in person or by proxy may demand a poll and every such holder will, on a poll, have one vote for every share of the class held by him. Subject to statute, the Articles specify that rights attached to any class of shares may be varied with the written consent of the holders of not less than three-quarters in nominal value of the issued shares of that class, or with the sanction of a special resolution passed at a separate general meeting of the holders of those shares. At every such separate general meeting the quorum shall be two persons holding or representing by proxy at least one-third in nominal value of the issued shares of the class. The rights conferred upon the holders of any shares shall not, unless otherwise expressly provided in the rights attaching to those shares, be deemed to be varied by the creation or issue of further shares ranking pari passu with them.
Restrictions on voting
No shareholder shall, unless the Directors otherwise determine, be entitled in respect of any share held by him or her to vote either personally or by proxy at a shareholders' meeting or to exercise any other right conferred by membership in relation to shareholders' meetings if any call or other sum presently payable by him or her to the Company in respect of that share remains unpaid. In addition, if any shareholder, or any other person appearing to be interested in shares held by such shareholder, has been duly served with a notice to provide the Company with information under Section 793 of the Companies Act and has failed to do so within 14 days, then (unless the Directors otherwise determine) the shareholder shall not (for so long as the default continues) be entitled to attend or vote either personally or by proxy at a shareholders' meeting or to exercise any other right conferred by membership in relation to shareholders' meetings.
Appointment and replacement of directors
The Board shall not be fewer than 5 nor more than 15 in number save that the Company may, by ordinary resolution, from time to time vary this minimum and/or maximum number of Directors. Directors may be appointed by ordinary resolution or by the Board. A Director appointed by the Board must retire from office at the first AGM after his appointment. A Director who retires in this way is then eligible for reappointment. The Board may appoint one or more Directors to any executive office, on such terms and for such period as it thinks fit and it can also terminate or vary such an appointment at any time. The Articles specify that at every AGM, any Director who has been appointed by the Vesuvius Board since the last AGM, any Director who held office at the time of the two preceding AGMs and who did not retire at either of them, and any Director who has been in office, other than holding an executive position, for a continuous period of nine years or more at the date of the meeting shall retire from office. Any Director who retires at an AGM may offer himself for reappointment.
Amendment of articles of association
The Company may make amendments to the Articles of the Company by way of special resolution in accordance with the Companies Act.
Interests in the Company's shares
The Company has been notified in accordance with DTR 5 of the Disclosure and Transparency Rules of the following interests in its issued ordinary shares:
|31 Dec 2012 %||Current|
|Cevian Capital II G.P. Ltd||20.01||20.01|
|Pelham Capital Management CFD||5.91||5.91|
|Standard Life Investments Ltd||4.87||4.87|
|Lloyds Banking Group plc||4.78||4.78|
|Fidelity Investments Ltd||4.20||4.20|
|Governance for Owners LLP||4.05||<3|
The interests of Directors and their connected persons in the ordinary shares of the Company as disclosed in accordance with the Listing Rules of the UK Listing Authority are as set out in the Directors' remuneration report and details of the Directors' long-term incentive awards and, where appropriate their deferred share bonus awards, are set out in the Directors' remuneration report.
The Directors' Report has been approved by the Board and is signed on its behalf by:
28 March 2013