Aspen Pharmacare Holdings Limited Notice of annual general meeting and proxy form 2014

Notice of annual general meeting

ASPEN PHARMACARE HOLDINGS LIMITED

Incorporated in the Republic of South Africa
Registration number 1985/002935/06
(“Company” or “the Group”)
JSE share code: APN
ISIN code: ZAE 000066692

A. NOTICE OF MEETING

Notice is hereby given that the 16th annual general meeting (“meeting”) of the shareholders of the Company will be held at Building Number 1, Healthcare Park, Woodlands Drive, Woodmead, Johannesburg, Gauteng, on Monday, 8 December 2014 at 10:00.

B. ATTENDANCE AND PARTICIPATION AT THE MEETING

General

The date on which a person must be registered as a shareholder in the register of the Company for purposes of being entitled to attend and participate in, and speak and vote at, the meeting is Friday, 28 November 2014 (“Record Date”).

Certificated shareholders and dematerialised shareholders with “own-name registration”

If you hold certificated shares or hold dematerialised shares with “own-name registration” (i.e. you specifically instructed your Central Securities Depository Participant (“CSDP”) to hold your shares in your own name on the Company’s sub-register):

A proxy need not be a shareholder of the Company.

Dematerialised shareholders other than those with “own-name registration”

If you hold dematerialised shares other than with “own-name registration”, you may:

Identification

Section 63(1) of the Act provides that all meeting participants must provide reasonably satisfactory identification to the Chairman of the meeting, who must be satisfied that the right of that person to participate in, and speak and vote at the meeting as a shareholder, as a proxy for a shareholder, or as a representative of a shareholder, has been verified.

Electronic participation

Shareholders or their proxies may participate in (but not vote at) the meeting by way of telephone conference call, and if they wish to do so:

Shareholders and their proxies will not be able to vote telephonically at the meeting and will still need to appoint a proxy or representative to vote on their behalf at the meeting.

C. PURPOSE OF THE MEETING

The purpose of the meeting is to:

D. INTERPRETATION

In this notice of meeting (including the proxy form attached hereto), the term:

ORDINARY BUSINESS

ORDINARY RESOLUTION NUMBER 1 – presentation and adoption of Annual Financial Statements

Resolution

To receive and adopt the Annual Financial Statements, including the Directors’ Report and the Audit & Risk Committee Report (included by reference), of the Company and the Group for the year ended 30 June 2014.

Explanation

In order for this ordinary resolution to be adopted, the support of a majority of the votes cast by the shareholders present or represented by proxy at the meeting is required.

A hard copy of the Annual Financial Statements may be obtained from the registered office of the Company or from the Company Secretary (by email at the address rverster@aspenpharma.com). An electronic copy of these statements may be obtained from the Company’s website www.aspenpharma.com.

ORDINARY RESOLUTION NUMBER 2 – re-election of directors

Resolution

To re-elect the following directors, who are retiring by rotation in terms of the memorandum of incorporation of the Company, all of whom are eligible and offer themselves for re-election:

(a)    Rafique Bagus;

(b)    John Buchanan;

(c)    Judy Dlamini;

(d)    Abbas Hussain; and

(e)    Maureen Manyama-Matome.

Explanation

Abbreviated biographical details of the directors are set out in the Integrated Report.

Each of the ordinary resolutions above will be considered by way of a separate vote and, in order for each ordinary resolution to be adopted, the support of a majority of the votes cast by the shareholders present or represented by proxy at the meeting is required.

ORDINARY RESOLUTION NUMBER 3 – re-appointment of independent external auditors

Resolution

To re-appoint the auditors, PricewaterhouseCoopers Inc, as the independent registered auditors of the Company and the Group, upon the recommendation of the Audit & Risk Committee, and to note that Tanya Rae will be the individual registered auditor who will undertake the audit for the financial year ending 30 June 2015.

Explanation

In order for this ordinary resolution to be adopted, the support of a majority of the votes cast by the shareholders present or represented by proxy at the meeting is required.

ORDINARY RESOLUTION NUMBER 4 – election of Audit & Risk Committee members

Resolution

To elect the following independent non-executive directors as members of the Audit & Risk Committee of the Company:

(a)    Roy Andersen;

(b)    John Buchanan;

(c)    Maureen Manyama-Matome; and

(d)    Sindi Zilwa.

Explanation

Abbreviated biographical details of the directors are set out in the Integrated Report.

Each of the ordinary resolutions above will be considered by way of a separate vote and, in order for each ordinary resolution to be adopted, the support of a majority of the votes cast by the shareholders present or represented by proxy at the meeting is required.

ORDINARY RESOLUTION NUMBER 5 – place unissued shares under the control of directors

Resolution

To place the ordinary shares in the authorised but unissued share capital of the Company at the disposal and under the control of the directors, subject to a maximum amount of 22 801 306 ordinary shares, which represents the equivalent of approximately 5% of the ordinary shares in issue as at 30 June 2014, being 456 341 037 ordinary shares, excluding treasury shares, until the next annual general meeting of the Company, who are hereby authorised and empowered, subject to the provisions of the Act and the Listings Requirements, to allot, issue and otherwise dispose of such shares to such person/s on such terms and conditions and at such time/s as the directors may from time to time in their discretion deem fit; provided that this resolution shall not authorise the directors to effect an issue of shares for cash as contemplated in the Listings Requirements.

Explanation

In order for this ordinary resolution to be adopted, the support of a majority of the votes cast by the shareholders present or represented by proxy at the meeting is required.

ORDINARY RESOLUTION NUMBER 6 – general but restricted authority to issue shares for cash

Resolution

To authorise the directors, by way of a general authority and subject to the provisions of the Act and the Listings Requirements, to issue ordinary shares for cash as and when suitable situations arise, subject to the following limitations:

Explanation

In order for this ordinary resolution to be adopted, the support of at least 75% of the votes cast by the shareholders present or represented by proxy at the meeting is required.

ORDINARY RESOLUTION NUMBER 7 – Remuneration Policy

Resolution

To endorse, by way of a non-binding advisory vote, the remuneration policy of the Company and the Group, as set out in the Remuneration Report of the Integrated Report.

Explanation

In order for this ordinary resolution to be adopted, the support of a majority of votes cast by the shareholders present or represented by proxy at the meeting is required.

ORDINARY RESOLUTION NUMBER 8 – authorisation of an executive director to sign necessary documents

Resolution

That any of the executive directors of the Company are authorised to sign all such documents and instruments and to do all such things as may be necessary for or incidental to the implementation of the resolutions passed at the meeting.

Explanation

In order for this ordinary resolution to be adopted, the support of a majority of the votes cast by the shareholders present or represented by proxy at the meeting is required.

SPECIAL BUSINESS

SPECIAL RESOLUTION NUMBER 1 – remuneration of non-executive directors

Resolution

To approve the remuneration of non-executive directors for the year ending 30 June 2015, and for the period 1 July 2014 to the date of the 2015 annual general meeting, on the basis set out below:

    Year to 30 June 2015 Year to 30 June 2014
    Proposed base  
fee  
R  
Proposed fee  
per meeting#
R  
Current base  
fee  
R  
Current fee  
per meeting  
R  
Board          
(a)   Chairman*   922 311   n/a   866 020   n/a  
(b)   Board member   133 210   25 062   125 080   23 532  
Audit & Risk Committee          
(c)   Chairman   167 134   30 848   156 933   28 965  
(d)   Member   85 006   15 184   79 818   14 257  
Remuneration & Nomination Committee          
(e)   Chairman   60 114   14 393   56 445   13 515  
(f)   Member   30 480   7 056   28 620   6 625  
Social & Ethics Committee          
(g)   Chairman   68 524   23 510   64 342   22 075  
(h)   Member   34 206   11 769   32 118   11 051  

* The Chairman does not receive any additional fees for her role as Chairman or for her attendance of committee meetings.
# Unscheduled meetings are remunerated at an hourly rate.

Explanation

This special resolution will be considered by way of a separate vote on the remuneration of each category of non-executive directors (as specified in each line item of the table on the previous page) and, in order for each special resolution to be adopted, the support of at least 75% of the votes cast by the shareholders present or represented by proxy at the meeting is required. Five scheduled Board meetings, five scheduled Audit & Risk Committee meetings, three scheduled Remuneration & Nomination Committee meetings and four scheduled Social & Ethics Committee meetings are to be held in the 2015 financial year. Unscheduled meetings of the Board and its committees may be held as required.

SPECIAL RESOLUTION NUMBER 2 – financial assistance to related or inter-related company

Resolution

That the Company or any of its subsidiaries be authorised, in terms of and subject to the requirements of section 45 of the Act, at any time and from time to time during the period of two years commencing on the date of adoption of this special resolution, to provide direct or indirect financial assistance by way of loan, guarantee, the provision of security or otherwise to any companies or corporations that are related or inter-related to the Company (as contemplated in the Act) up to a maximum amount of R16 billion.

Explanation

In order for this special resolution to be adopted, the support of at least 75% of the votes cast by the shareholders present or represented by proxy at the meeting is required.

This special resolution does not authorise the provision of financial assistance to a director or a prescribed officer of the Company or any company or person related to a director or prescribed officer of the Company as the Company does not provide such financial assistance.

The Board shall, before authorising the provision of any financial assistance contemplated in this special resolution, comply with the requirements set out in section 45 of the Act relating to, inter alia, solvency and liquidity.

SPECIAL RESOLUTION NUMBER 3 – general authority to repurchase shares

Resolution

To authorise the directors, by way of a general authority, to facilitate an acquisition by the Company or any of its subsidiaries, from time to time, of up to 20% of the Company’s ordinary issued share capital in terms of the Act and the Listings Requirements, provided that a subsidiary may not hold more than 10% of the Company’s issued share capital. Such general approval shall be valid until the earlier of the date of the next annual general meeting of the Company or the date that is 15 months from the date of the passing of this special resolution.

Explanation

It is recorded that the Listings Requirements currently require, inter alia, that the Company may make a general repurchase of securities only if:

The directors have no specific intention, at present, for the Company or Group to repurchase any of the Company’s shares, but should the authority be granted at the meeting, it will provide the Board of Directors with the flexibility to repurchase such shares as and when the best interests of the Company require it to do so.

Additional information required to be disclosed in connection with this special resolution in terms of the Listings Requirements is contained under section F of this notice of meeting.

In order for this special resolution to be adopted, the support of at least 75% of the votes cast by the shareholders present or represented by proxy at the meeting is required.

E. PRESENTATION OF THE REPORT OF THE SOCIAL & ETHICS COMMITTEE

Shareholders are referred to the Social & Ethics Committee Report for the year ending 30 June 2014, which can be accessed from the Company’s website www.aspenpharma.com. Copies of the report are available from the Company Secretary (by email at the address rverster@aspenpharma.com) and will be available at the meeting. The Chairman of the Social & Ethics Committee will be present at the meeting to answer any questions that shareholders may have on this report, but the report will be regarded as having been read.

F. ADDITIONAL DISCLOSURE REQUIRED IN TERMS OF THE LISTINGS REQUIREMENTS RELATING TO SPECIAL RESOLUTION 3

Solvency and liquidity statement

The directors of the Company, after considering the effect of the repurchase of the maximum number of the Company’s shares in terms of the general authority to be provided in terms of Special Resolution Number 3, are satisfied that for a period of 12 months after the date of this notice of meeting:

The Company undertakes to advise its sponsor before embarking on a general repurchase or capital distribution, in order to enable the sponsor to furnish the JSE with written confirmation of the Company’s working capital.

Additional information

The following additional information is provided in terms of the Listings Requirements for purposes of the general authority to repurchase the Company’s shares, as applicable:

Directors’ responsibility statement

The directors, whose names appear in the Integrated Report, collectively and individually accept full responsibility for the accuracy of the information pertaining to Special Resolution Number 3 and certify that, to the best of their knowledge and belief, there are no facts that have been omitted that would make any statement false or misleading, and that all reasonable enquiries to ascertain such facts have been made and that Special Resolution Number 3 contains all information required by the Listings Requirements.

Material changes

Other than the facts and developments reported on in the Integrated Report and Annual Financial Statements, there have been no material changes in the affairs or financial position of the Company and its subsidiaries since the date of signature of the audit report and up to the date of this notice of meeting.

By order of the Board

Riaan Verster

Company Secretary & Group Governance Officer
Johannesburg
22 October 2014

Explanatory notes to resolutions for consideration at the annual general meeting

ORDINARY BUSINESS

Ordinary Resolution Number 1 – presentation and adoption of Annual Financial Statements

The directors must present to shareholders at the meeting the Annual Financial Statements incorporating the Directors’ Report and the Audit & Risk Committee report for the year ended 30 June 2014. These are contained within the unabridged Annual Financial Statements.

Ordinary Resolution Number 2 – re-election of directors

In terms of the memorandum of incorporation of the Company, one-third of the directors are required to retire at each annual general meeting and may offer themselves for re-election. In addition, any person appointed subsequent to the last annual general meeting is similarly required to retire and is eligible for re-election at the next annual general meeting. The Remuneration & Nomination Committee considered the contribution, performance and attendance of the directors offering themselves for re-election and has no hesitation in recommending them for re-appointment by the shareholders.

Ordinary Resolution Number 3 – re-appointment of independent external auditors

The reason for proposing this ordinary resolution is to confirm, upon the recommendation of the Audit & Risk Committee, the appointment of PricewaterhouseCoopers Inc as the independent external auditors of the Company and the Group, and to note that Tanya Rae will be the individual registered auditor who will undertake the audit for the financial year ending 30 June 2015.

Ordinary Resolution Number 4 – election of Audit & Risk Committee members

In terms of King III, the Audit & Risk Committee must comprise a minimum of three independent non-executive directors and further, in terms of the regulations to the Act, at least one-third of the members of the Committee must have academic qualifications or experience in economics, law, corporate governance, finance, accounting, commerce, industry, public affairs or human resource management. Having regard to the aforementioned, the Remuneration & Nomination Committee considered the expertise, experience and independence requirements of the members offering themselves for election and recommended to the Board that the directors be proposed to shareholders for approval.

Ordinary Resolution Number 5 – place unissued shares under the control of directors

It is considered advantageous to grant the directors authority to enable the Company to take advantage of business opportunities that might arise in the future. This authority is due to expire at the next annual general meeting.

Ordinary Resolution Number 6 – general but restricted authority to issues shares for cash

The reason for proposing this ordinary resolution is to enable the directors to undertake a general issue of shares for cash in accordance with, and subject to the requirements of, the JSE Listings Requirements when they consider such corporate activity advantageous in light of prevailing market conditions. When a company proposes to issue shares for cash (or in order to extinguish a liability, obligation or commitment, restraint or settle any expenses), among others, the shareholders must authorise that issue by way of an ordinary resolution that achieves the support of a super-majority of 75% of those shareholders present or represented by proxy and voting on such resolution.

Ordinary Resolution Number 7 – remuneration policy

The reason for proposing this ordinary resolution is in order that shareholders may endorse, by way of a non-binding advisory vote, the Company’s Remuneration Policy as set out in the Remuneration Report of the Integrated Report.

Ordinary Resolution Number 8 – authorisation of an executive director to sign necessary documents

It is necessary to confer upon an executive director of the Company an authority to sign all documents as may be necessary for or incidental to the resolutions to be proposed at the meeting.

SPECIAL BUSINESS

Special Resolution Number 1 – remuneration of non-executive directors

The Company, in general meeting, as per its memorandum of incorporation and the Act, shall from time to time determine the remuneration of non-executive directors, subject to shareholder approval.

Special Resolution Number 2 – financial assistance to related or inter-related company

In accordance with section 45 of the Act, the Company may not provide financial assistance (as contemplated in section 45 of the Act) without a special resolution. The reason for proposing the special resolution is to permit and authorise the Company and/or any subsidiaries to provide direct or indirect financial assistance, by way of a loan, the guaranteeing of a loan or other obligation or the securing of a debt or other obligation, to the recipients contemplated in Special Resolution Number 2.

It is difficult to foresee the exact details of financial assistance that the Company and/or its subsidiaries may be required to provide over the next two years. It is essential, however, that the Company is able to organise effectively its internal financial administration. For these reasons, and because it would be impractical and difficult to obtain shareholder approval every time the Company and/or its subsidiaries wish/es to provide financial assistance as contemplated above, it is necessary to obtain the approval of shareholders, as set out in Special Resolution Number 2.

It should be noted that this resolution does not authorise financial assistance to a director or a prescribed officer of the Company or any company or person related to a director or prescribed officer of the Company.

Special Resolution Number 3 – general authority to repurchase shares

The reason for proposing this special resolution is to permit and authorise the Company and/or any subsidiaries to acquire the Company’s ordinary issued shares. The effect will be to grant the directors a general authority to facilitate the repurchase by the Company or any of its subsidiaries of up to 20% of the Company’s ordinary issued share capital. Such general authority will provide the Board with the flexibility, subject to the requirements of the Act and the Listings Requirements, to repurchase the Company’s shares should it be in the interests of the Company while the general authority exists. This general authority shall be valid until the next annual general meeting; provided that it shall not extend beyond 15 months from the date of adoption of this special resolution.

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