Notice of annual general meeting

Notice of annual general meeting

Barloworld Limited

(Incorporated in the Republic of South Africa)
Registration number 1918/000095/06
JSE share code: BAW
ISIN: ZAE000026639
(“company”)

Notice is hereby given that the ninety-ninth annual general meeting (AGM) of shareholders of the company will be held in the Tokyo Meeting Room, Barloworld Corporate Office, 180 Katherine Street, Sandton, on Wednesday, 3 February 2016, at 12:30 for the purpose of considering the following business and, if deemed fit, to pass, with or without modification, the resolutions set out below.

The record date on which shareholders must be recorded as such in the register maintained by the transfer secretaries of the company for the purposes of determining which shareholders are entitled to attend and vote at the AGM is Friday, 29 January 2016.

1.
Ordinary resolutions

Voting percentage

Each of ordinary resolutions 1 to 10 will be considered by way of a separate vote and in order for each such resolution to be adopted; the support of more than 50% (fifty percent) of the voting rights on the resolution cast by shareholders present or represented by proxy at this meeting is required.
1.1 Acceptance of annual financial statements

Ordinary resolution 1 is proposed to receive and accept the consolidated audited annual financial statements for the year ended 30 September 2015, including the directors’ report, the independent auditors’ report and the audit committee report thereon. The summarised financial statements, the directors’ report, the independent auditors’ report and the audit committee report thereon are set out in the integrated report. The consolidated audited annual financial statements are available online at www.barloworld.com.
1.1.1 Ordinary resolution 1

“Resolved that the consolidated audited annual financial statements for the year ended 30 September 2015, including the directors’ report, the independent auditors’ report and the audit committee report thereon be and are hereby received and accepted.”
1.2 Re-election of directors

In terms of clause 7.1.5 of the company’s memorandum of incorporation (MOI), at every AGM at least one third of the directors, excluding the directors appointed in terms of clause 7.2.1 of the MOI, must retire by rotation and the directors to so retire shall be those who have been longest in office since their last election.

Messrs AGK Hamilton, OI Shongwe, and DG Wilson and Ms NP Dongwana and Ms B Ngonyama are required to retire by rotation. All of the retiring directors are eligible and with the exception of AGK Hamilton they have offered themselves for re-election. Mr AGK Hamilton retires from the board at the AGM.

Ordinary resolutions 2 to 5 are proposed to re-elect the directors who retire by rotation in accordance with the company’s MOI and who, being eligible, have offered themselves for re-election.

The nomination committee conducted an assessment of the performance of each of the retiring directors and the board considered the findings of the nomination committee. Based on these findings, the board recommends to shareholders the re-election of each of the retiring directors.

Brief biographical information of each of the retiring directors eligible for re-election is set out on pages 2 and 3 of this document.
1.2.1 Ordinary resolution 2

“Resolved that Ms NP Dongwana, be and is hereby re-elected as a director of the company.”
1.2.2 Ordinary resolution 3

“Resolved that Ms B Ngonyama, be and is hereby re-elected as a director of the company.”
1.2.3 Ordinary resolution 4

“Resolved that Mr OI Shongwe, be and is hereby re-elected as a director of the company.”
1.2.4 Ordinary resolution 5

“Resolved that Mr DG Wilson, be and is hereby re-elected as a director of the company.”
1.3 Election of audit committee

Ordinary resolutions 6 to 8 are proposed to elect an audit committee in terms of section 94(2) of the Companies Act, No 71 of 2008 (as amended) (the Companies Act) and the King Report on Corporate Governance for South Africa (King III).

The nomination committee conducted an assessment of the performance and independence of each of the directors proposed to be members of the audit committee, namely Mr SS Ntsaluba, Ms B Ngonyama and Ms FNO Edozien and the board considered and accepted the findings of the committee. The board is satisfied that the proposed members meet the requirements of section 94(4) of the Companies Act, that they are independent according to King III and that they possess the required qualifications and experience as prescribed in Regulation 42 of the Companies Act Regulations, 2011.

Brief biographical notes of each member standing for election are set out on page 2 of this document.
1.3.1 Ordinary resolution 6

“Resolved that Mr SS Ntsaluba is re-elected as a member and elected as the chairman of the audit committee to hold office until the next AGM.”
1.3.2 Ordinary resolution 7

“Resolved that Ms B Ngonyama is re-elected as a member of the audit committee to hold office until the next AGM.”
1.3.3 Ordinary resolution 8

“Resolved that Ms FNO Edozien is elected as a member of the audit committee to hold office until the next AGM.“
1.4 Appointment of external auditor

Ordinary resolution 9 is proposed to approve the appointment of Deloitte & Touche as the external auditor of the company for the financial year ending 30 September 2016, in accordance with section 90(1) of the Companies Act, and to remain in office until the conclusion of the next AGM, and to authorise the audit committee to determine its remuneration.

Subject to the passing of the resolution, Mr B Nyembe will be the individual registered auditor who will undertake the audit for the financial year ending 30 September 2016.

The current audit committee and the board are satisfied that Deloitte & Touche and Mr B Nyembe meet the requirements of the Companies Act.
1.4.1 Ordinary resolution 9

“Resolved that Deloitte & Touche be appointed as the external auditor of the company and of the group for the financial year ending 30 September 2016 and to remain in office until the conclusion of the next AGM, and that its remuneration for the financial year ending 30 September 2016 be determined by the audit committee.”
1.5 Non-binding advisory vote on remuneration policy

The purpose of ordinary resolution 10 is to endorse, by way of a non-binding advisory vote, the remuneration policy of the company set out on pages 124 to 130 of the integrated report.

The board is responsible for determining the remuneration of executive directors in accordance with the remuneration policy of the company. The remuneration committee assists the board in its responsibility for setting and administering remuneration policies in the company’s long-term interests. The remuneration committee considers and recommends remuneration for all levels in the company, including the remuneration of senior executives and executive directors, and advises on the remuneration of non-executive directors. King III recommends that every year the company’s remuneration policy should be tabled to shareholders for a non-binding advisory vote at the AGM.

The remuneration committee prepared, and the board considered and accepted, the remuneration policy, as set out in the Remuneration report of the integrated report, and shareholders are required to vote on it.
1.5.1 Ordinary resolution 10

“Resolved that the company’s remuneration policy, as set out in the Remuneration report of the integrated report, be and is hereby endorsed by way of a non-binding advisory vote.”
2.
Special resolutions

Voting percentage

Each of special resolutions 1 to 3 will be considered by way of a separate vote and in order for each such resolution to be adopted, the support of at least 75% (seventy-five percent) of the voting rights on the resolution cast by shareholders present or represented by proxy at this meeting is required.
2.1 To approve the non-executive directors’ fees

Section 66(8) (read with section 66(9)) of the Companies Act provides that, to the extent permitted in the MOIs, the company may pay remuneration to its directors for their services as directors provided that such remuneration may only be paid in accordance with a special resolution approved by shareholders within the previous two years. Clause 7.9 of the MOI does not limit, restrict or qualify the power of the company to pay remuneration to its directors for their service. The remuneration committee has considered the remuneration for non-executive directors and the board has accepted the recommendations of the remuneration committee.
2.1.1 Special resolution 1:

“Resolved that the fees payable to the non-executive directors for their services to the board and committees of the board be revised by a separate vote in respect of each item, with effect from 1 January 2016 as follows:

  Non-executive directors’ fees Present   Proposed*  
1.1 Chairman of the board R1 554 000   R1 585 080  
1.2 Resident non-executive directors R305 772   R330 234  
1.3 Non-resident non-executive directors £58 887   £58 887  
1.4 Chairman of the audit committee (resident)** n/a   R279 000  
1.5 Resident members of the audit committee R114 404   R123 557  
1.6 Non-resident members of the audit committee n/a   £6 150  
1.7 Chairman of the remuneration committee (non-resident) £18 373   £18 373  
1.8 Chairman of the social, ethics and transformation committee (resident) R112 324   R121 310  
1.9 Chairman of the risk and sustainability committee (resident) R124 805   R134 789  
1.10 Chairman of the general purposes committee (resident) R112 324   R121 310  
1.11 Chairman of the nomination committee (resident) R112 324   R121 310  
1.12 Resident members of each of the board committees other than audit committee R75 816   R81 881  
1.13 Non-resident members of each of the board committees £4 396   £4 396  
1.14 Ad hoc work performed by non-executive directors for special projects (hourly rate) n/a   R2 500  
* Per calendar year, commencing on 1 January 2016, and subsisting until another special resolution dealing with the fees payable to non-executive directors is adopted, or this special resolution expires, whichever happens first.”
** The chairman of the audit committee for 2015 was a non-resident, non-executive director with an approved fee of £28 611.
2.2 Loans or other financial assistance to related or inter-related companies or corporations

Section 45 of the Companies Act provides, among other things, that, except to the extent that the MOI of a company provides otherwise, the board may authorise the company to provide direct or indirect financial assistance (which includes lending money, guaranteeing a loan or other obligation and securing any debt or obligation) to a related or inter-related company or corporation, including a subsidiary of the company incorporated in or outside of the Republic of South Africa, provided that such authorisation shall be made pursuant to a special resolution of the shareholders adopted within the previous two years, which approved such assistance either for the specific recipient or generally for a category of potential recipients and the specific recipient falls within that category.
2.2.1 Special resolution 2:

“Resolved that the directors of the company be and are hereby authorised, in accordance with section 45 of the Companies Act, to authorise the company to provide direct or indirect financial assistance to any company or corporation, including a subsidiary of the company incorporated in or outside of the Republic of South Africa, which is related or inter-related to the company.”
2.3 General authority to acquire the company’s own shares

Special resolution 3 is proposed to authorise the acquisition by the company, and any subsidiary of the company, of up to 5% of the ordinary shares issued by the company.

The board’s intention is for the shareholders to pass a special resolution granting the company and its subsidiaries a general authority to acquire ordinary shares issued by the company in order to enable the company and its subsidiaries, subject to the requirements of the Companies Act, the Listings Requirements of the JSE and the company’s MOI, to acquire ordinary shares issued by the company, should the board consider that it would be in the interest of the company and/or its subsidiaries to acquire ordinary shares issued by the company while the general authority subsists.
2.3.1 Special resolution 3:

“Resolved that the company and any subsidiary of the company be and are hereby authorised, subject to the provisions of the Companies Act, the Listings Requirements of the JSE and the company’s MOI, to acquire (repurchase), as a general repurchase, up to 5% of the ordinary shares issued by the company; provided that the company and any subsidiary may only make such general repurchase subject to the following:

(a) the repurchase of securities being effected through the order book operated by the JSE trading system and done without any prior understanding or arrangement between the company and the counterparty (reported trades are prohibited);
(b) authorisation thereto being given by the company’s MOI;
(c) the approval shall be valid only until the next AGM or for 15 months from the date of the resolution, whichever period is shorter;
(d) repurchases may not be made at a price greater than 10% above the weighted average of the market value for the securities for the five business days immediately preceding the date on which the transaction is effected;
(e) at any point in time, the company may only appoint one agent to effect any repurchase(s) on the company’s behalf;
(f) a resolution is passed by the board authorising the repurchase and confirming that the company has passed the solvency and liquidity test and that, since the test was performed, there have been no material changes to the financial position of the group;
(g) in the event that the directors are granted general authority to buy back a maximum 5% of the issued share capital of Barloworld, or in the case of acquisition by any of the company’s subsidiaries, 5% of the issued ordinary share capital in the aggregate, it is the opinion of the directors that following such maximum repurchase of shares:
  • the company and the group would be able in the ordinary course of business to pay its debts for a period of 12 months after the date of notice issued in respect of the AGM;
  • the assets of the company and the group would be in excess of the liabilities of the company and the group. For this purpose, the assets and liabilities would be recognised and measured in accordance with the accounting policies used in the latest audited group annual financial statements;
  • the ordinary capital and reserves of the company and the group would be adequate for a period of 12 months after the date of notice issued in respect of the AGM; and
  • the working capital of the company and the group would be adequate for a period of 12 months after the date of notice issued in respect of the AGM; and
(h) the company or any of its subsidiaries may not repurchase securities during a prohibited period, as defined in paragraph 3.67 of the Listings Requirements of the JSE, unless they have in place a repurchase programme where the dates and quantities of securities to be traded during the relevant period are fixed (not subject to any variation) and has been submitted to the JSE in writing, prior to the commencement of the prohibited period.

Disclosures in regard to other Listings Requirements of the JSE applying to special resolution 3

The Listings Requirements of the JSE prescribe certain disclosures, which are disclosed in the group audited annual financial statements and the integrated report.

Major shareholders

Details of major shareholders of the company are set out in the Shareholder profile of the integrated report.

Material change

There has been no material change in the financial or trading position of the company and its subsidiaries since the date of publication of the company’s annual results on 16 November 2015.

Share capital of the company

Details of the share capital of the company are set out in the Shareholder profile of the integrated report.

Directors’ responsibility statement

The directors collectively and individually accept full responsibility for the accuracy of the information given and certify that to the best of their knowledge and belief there are no facts that have been omitted which would make the statement false or misleading.

Certificated shareholders/dematerialised shareholders with own name registration

Registered holders of certificated ordinary shares and holders of dematerialised ordinary shares in their own names may attend, speak and vote at the AGM or are entitled to appoint a proxy or more than one proxy to attend, speak and vote in their stead.

Registered holders of certificated 6% non-redeemable cumulative preference shares (preference shares) and holders of dematerialised preference shares in their own names may attend the AGM and, in relation to special resolution 3 only, speak and vote or are entitled to appoint a proxy to attend the AGM and, in relation to special resolution 3 only, speak and vote in their stead.

Any person appointed as a proxy need not be a shareholder of the company

Proxy forms should be forwarded to reach the company’s transfer secretaries, Link Market Services South Africa Proprietary Limited, 13th Floor, Rennie House, 19 Ameshoff Street, Braamfontein, Johannesburg 2001 (PO Box 4844, Johannesburg 2000) or United Kingdom registrars, Equiniti Limited, Aspect House, Spencer Road, Lancing, West Sussex, BN99 6ZL, England, by not later than 12:30 (South African time) on Monday, 1 February 2016.

Dematerialised shareholders

Shareholders who have dematerialised their shares through a Central Securities Depositary Participant (CSDP) or stockbroker, and who have not elected own-name registration and wish to attend the AGM, should timeously inform their CSDP or stockbroker of their intention to attend the meeting and request such CSDP or stockbroker to issue them with the necessary authority to attend. If they do not wish to attend the AGM, they may provide such CSDP or stockbroker with their voting instructions.

Voting rights

The ordinary shareholders are entitled to vote on all the resolutions set out above. On a show of hands, every ordinary shareholder who is present in person or by proxy at the AGM will have one vote (irrespective of the number of ordinary shares held in the company) and, on a poll, every ordinary shareholder will have one vote for every ordinary share held or represented. The 6% non-redeemable cumulative preference shareholders (preference shareholders) are entitled to vote only on special resolution 3. On a show of hands, every preference shareholder who is present in person or by proxy at the AGM will have one vote (irrespective of the number of preference shares held in the company) and, on a poll, every preference shareholder will have 40 votes for every preference share held or represented.

Identification

In terms of section 63(1) of the Companies Act, any person attending or participating in the AGM must present reasonably satisfactory identification and the person presiding at the AGM must be reasonably satisfied that the right of any person to participate in and vote, whether as a shareholder or as a proxy for a shareholder, has been reasonably verified. Acceptable forms of identification include valid identity documents, drivers’ licences and passports.

Electronic participation by shareholders

Should any shareholder (or a proxy for a shareholder) wish to participate in the AGM by way of electronic participation, that shareholder should make an application in writing (including details as to how the shareholder or its representative (including its proxy) can be contacted) to so participate to the transfer secretaries, at their address above, to be received by the transfer secretaries at least five business days prior to the AGM for the transfer secretaries to arrange for the shareholder (or its representative or proxy) to provide reasonably satisfactory identification to the transfer secretaries for the purposes of section 63(1) of the Companies Act and for the transfer secretaries to provide the shareholder (or its representative or proxy) with details on how to access any electronic participation to be provided. The company reserves the right not to provide for electronic participation at the AGM in the event that it determines that it is not practical to do so. The costs of accessing any means of electronic participation provided by the company will be borne by the company.

By order of the board

LP Manaka
Company secretary

Sandton
4 December 2015