Investors’ rights to requisition a resolution
There are occasions when BP’s investors may wish to draw important matters to the attention of other investors by proposing a resolution to be put to BP’s annual general meeting (AGM). The procedure for requisitioning such a resolution is governed by English common law and statute. Investors wishing to requisition a resolution may find the following information helpful. However, they should always seek their own independent legal advice on these matters. The costs of circulating a resolution for the 2017 AGM will be borne by BP so long as a compliant requisition for the resolution is received on or before 21 January 2017. For resolutions received after this date, BP will require the deposit or tender of a sum sufficient to meet the company’s reasonable circulation and other expenses. The legal deadline for lodging a requisition is 6 weeks before the AGM (which is by the close of 4 April 2017, assuming that BP’s AGM is held, as currently planned, on 17 May 2017). The following information includes sample forms which requisitionists may wish to use when providing the necessary information to BP in support of their requisition. You do not need to use these forms to provide the relevant information, but please note that BP is not required to accept a requisition unless all the required information has been provided. Organizing investor support for a requisitioned resolution can be a complex process (particularly in the case of indirect investors and ADS holders). It is recommended that you start the process early including contacting BP if you need assistance. BP is under no obligation to accept a requisition which does not comply with legal requirements.
What should the requisition contain and what formalities should be met?
Requisitionists are strongly recommended to obtain independent legal advice on the drafting of their requisition. Please note that BP will not meet the requisitionists legal or other costs in preparing the requisition Points to note: The requisitioned resolution must be of a nature that may properly be moved at the AGM, and be clear and unambiguous in its effect. It may not be moved if it would be inconsistent with any law, BP's articles of association, it is defamatory of any person or it is frivolous or vexatious. The requisitioned resolution should direct the directors to take a course of action. Resolutions intending to express an opinion as to how the directors should exercise their powers, are not resolutions that may properly be moved at an AGM. BP's articles of association require that a resolution which tells the directors what to do, must be moved as a special resolution. The fact that the resolution is a special resolution should be stated on the resolution itself. A special resolution is a resolution which is passed by a majority of not less than 75% of those who vote for the resolution. The requisition must be in English and in readable form. Electronic or hard copy form will be accepted. The requisition should be signed by each member supporting it, and should specify their name, address and account number(s) as they appear in the register of members held by the BP Registrar, Capita Asset Services. In the case of a corporate member the requisition must be executed under seal or signed by an attorney or by an officer duly authorized to submit the requisition. Each member should identify the number of shares being committed in support of the requisition. This information should be linked to the signatures supporting the requisition. (For requisitions supported by members see: Sample Form A) For information on how indirect investors may support a requisition, please see the section "How can indirect investors in BP support a requisition?" For information on how ADS holders may support a requisition, please see the section "How can ADS Holders support a requisition?" A requisition may be submitted as a single document with the appropriate number of signatures attached, or in identical form submitted independently with separate signatures. The requisition will become valid only when a sufficient number of signatures have been received to indicate the required level of support. A requisition may be accompanied by a statement (of not more than 1000 words), which should also be signed by the requisitionists. The resolution and any accompanying statements will be published on behalf of the requisitionists. BP will not publish the names of the requisitionists unless otherwise instructed. If any requisitionist wants their name to be published, a specific request should be made. Space constraints may require an extensive list of names to be set out in a footnote in the notice of the meeting.
What support is required to requisition a members’ resolution?
Under English law a requisition must be supported either by:
- not less than 5% of the total voting rights of all members; or
- not less than 100 members who hold shares in BP on which there has been paid up an average sum per member of not less than £100 in nominal value*.
A member is a person whose name appears on the register of members held by the company’s registrars, Capita Asset Services. For the purposes of the 100 members requirement described above, the Companies Act 2006 now allows for the inclusion of indirect investors in BP shares (indirect investors), if certain conditions are met. These conditions are set out in more detail in “How can indirect investors in BP shares support a requisition?”. *As the nominal value of an ordinary share is US $0.25 (25¢) it must be converted into £ Sterling. For these purposes, the US$/£ Sterling exchange rate will be the Bank of England 4 p.m. closing exchange rate on the date that the total number of members who have deposited the requisition first exceeds 100. If the required average of £100 in nominal value is not attained on that date all subsequent deposits will be converted on the date of deposit until either the required average is attained or the last date for deposit is reached. Sample calculation for meeting the shareholding requirement:
How can indirect investors in BP shares support a requisition?
The Companies Act 2006 now allows for indirect investors in BP shares to support a requisition for a members’ resolution as part of the 100 members requirement (as set out in “What support is required to requisition a members’ resolution?”). This is subject to certain requirements of the Act being met. Where a requisition for a resolution is being supported by indirect investors as part of the 100 persons requirement, the requisition must be signed by all such persons making it and be accompanied by a statement to BP from each indirect investor (the Indirect Investor Supporting Statement; see: Sample Form B) which includes the following:
- details of the name and address and account number(s) of the registered member who holds the shares on behalf of the indirect investor (as they appear on the register of members held by the BP Registrar, Capita Asset Services);
- confirmation that the member is holding those shares on behalf of the indirect investor in the course of a business;
- details of the number of BP shares held on behalf of the indirect investor and the total amount paid up on those shares (as the average sum paid up per requisitioner must not be less than £100 in nominal value);
- confirmation that such BP shares are not held by the member on behalf of anyone else or, if they are, that such other persons are not involved in making the requisition (as such shares cannot be counted twice when calculating the support for the requisition);
- confirmation that at least some of the BP shares confer voting rights (all ordinary and preference shares confer voting rights); and
- confirmation that the indirect investor has the right to instruct the member on how to exercise those voting rights.
BP may also require that the indirect investor provide it with such evidence of the above matters which it may reasonably require. If the requisition is being supported by a mix of members and indirect investors (to make up the 100 person requirement) then in addition to each indirect investor providing BP with an Indirect Investor Supporting Statement (see: Sample Form B), each member who wants his shares to count towards that mix must also provide BP with a statement (the Member Supporting Statement; see: Sample Form C) specifying that they either hold the BP shares directly for himself or on behalf of person(s) who are not involved in the requisition. The Member Supporting Statement should also specify the amount paid up on the shares held which are being used to support the requisition. The indirect investor must also observe the formalities set out in “What should the requisition contain and what formalities should be met?”.
How can ADS Holders support a requisition?
An ADS Holder wishing to support a requisition for a members’ resolution may do so by:
- converting at least one ADS into ordinary shares in accordance with the terms of the Deposit Agreement; or
- approaching Guaranty Nominees Limited to seek its support for a requisition. (Guaranty Nominees Limited, can be counted only as a single member for the purposes of any requisition irrespective of whether more than one ADS holder requests it to support a requisition.); or
- ADS holders may now, in some cases, have additional rights to participate in the support of a requisition. As this will need to be discussed on a case by case basis, early discussions with the Company Secretary’s Office are recommended.
To request further information on any of the above, please send an email to firstname.lastname@example.org. Alternatively, you can contact the Company Secretary’s Office whose details are below.
You may obtain copies of:
- the Deposit Agreement,
- a pro-forma BP American Depositary Receipt
- the company’s Articles of Association
JPMorgan Chase Bank N.A. 4 New York Plaza Floor 12 New York New York 10004, USA
The Company Secretary’s Office BP p.l.c. 1 St James’s Square London, SW1Y 4PD Tel: +44 (0) 207 496 4000 Fax: +44 (0) 207 496 2681 or e-mail: email@example.com
When and where to send your requisition for a members’ resolution and who pays the cost?
BP’s articles of association provide that the costs of circulating a members’ resolution to the Annual General Meeting will be borne by BP so long as a compliant requisition for a members’ resolution (including any supporting statement(s) and other required information) are received on or before 21 January 2017. For requisitions received after this date, BP will require that the requisitionists deposit a sum sufficient to meet its reasonable expenses in giving effect to the requisition. The funds to cover such costs must be deposited with BP before a requisition can be actioned. The legal deadline for lodging a compliant requisition for a members’ resolution is 6 weeks before the AGM (which is by the close of 4 April 2017, assuming that BP’s AGM is held, as currently planned, on 17 May 2017). It should be noted that requisitionists will have to meet their own costs (such as legal costs) in putting forward the requisition. You should send your requisition for a members’ resolution:
The Company Secretary’s Office BP p.l.c. 1 St James’s Square London, SW1Y 4PD
+44 (0) 207 496 4678 with hard copy sent to the above address