24.4 EXAMPLE OF THE SPECIAL RESOLUTION REQUIRED
This special resolution is with the courtesy of Murray and Roberts
Special Resolution Number 1
Provision of financial assistance to any company related or inter-related to the Company or to any juristic person who is a member of or related to any such companies
“RESOLVED THAT, as a general approval, the Company may, in terms of section 45(3)(a)(ii) of the Companies Act, 71 of 2008, as amended (“Companies Act”) and subject to compliance with the remainder of section 45 of the Companies Act, provide any direct or indirect financial assistance (‘financial assistance’ will herein have the meaning attributed to it in section 45(1) of the Companies Act) that the board of directors of the Company may deem fit to any related or inter-related company or to any juristic person who is a member of or related to any such companies (‘related’ and ‘inter-related’ will herein have the meaning so attributed in section 2 of the Companies Act) (on the terms and conditions, to the recipient/s, in the form, nature and extent, and for the amounts that the board of directors of the Company may determine from time to time).”
Reason for and effect of special resolution number 1:
The reason for and effect of special resolution number 1 (“Special Resolution”), if adopted, will be to confer authority on the board of directors of the Company to authorise financial assistance to companies related or inter-related to the Company, or to any juristic person who is a member of or related to any such companies generally as the board of directors of the Company may deem fit, on the terms and conditions, and for the amounts that the board of directors may determine from time to time, for a period of about fifteen months up to and including the 2012 annual general meeting of the Company from the date of adoption of the Special Resolution, and in particular as specified in this special resolution. The granting of the general authority would obviate the need to refer each instance of provision of financial assistance in the circumstances contemplated in the Special Resolution for ordinary shareholder approval.
This general authority would assist the Company with, inter alia, making inter-company loans to subsidiaries of the Company, or inter-related companies, as well as granting letters of support and guarantees in appropriate circumstances. This would avoid undue delays and attendant adverse financial impact on subsidiaries, or inter-related companies, as it would facilitate the expeditious conclusion of negotiations.
This general authority would be valid up to and including the 2012 annual general meeting of the Company. In the event that the Special Resolution is adopted by the ordinary shareholders of the Company, thereby conferring general authority on the board of directors of the Company to authorise financial assistance to companies related or inter-related to the Company or to any juristic person who is a member of or related to any such companies, then the board of directors of the Company shall not authorise any financial assistance contemplated in such Special Resolution unless the board:
1. is satisfied that immediately after providing the financial assistance, the Company will satisfy the solvency and liquidity test contemplated in section 4 of the Companies Act (section 45(3)(b)(i)); and
2. is satisfied that the terms under which the financial assistance is proposed to be given are fair and reasonable to the Company (section 45(3)(b)(ii)); and
3. has ensured that any conditions or restrictions in respect of the granting of financial assistance set out in the Company’s Memorandum of Incorporation have been satisfied (section 45(4)).
This Special Resolution does not authorise the provision of financial assistance to a director or prescribed officer of the Company.