SECTION 1
Rights and Restrictions Attaching to the B Shares
The following summarises the rights of the B Shares and the restrictions to which they are subject, which are reflected in the New Articles of Association of Vodafone.
1. Income
The B Shares shall confer no right to participate in the profits of Vodafone.
2. Capital
If Vodafone is wound up (but in no other circumstances involving a repayment of capital or distribution of assets to Shareholders whether by reduction of capital, redeeming or buying back shares or otherwise), the holders of B Shares will be entitled, before any payment to the holders of the New Ordinary Shares but after any payment to the holders of the Fixed Rate Shares, to repayment of the amount paid up or treated as paid up on the nominal value of each B Share. The aggregate entitlement of each holder of B Shares on a winding-up in respect of all of the B Shares held by that holder of B Shares will be rounded down to the nearest whole cent.
The holders of B Shares will not have any other right to share in Vodafone’s surplus assets. If there is a winding-up as outlined in the paragraph above and there is not enough to pay the amounts due on the B Shares, the holder of the B Shares will share what is available in proportion to the amounts to which they would otherwise be entitled.
The B Shares shall rank pari passu with the C Shares as regards the sums received by them on a return of capital on a winding-up.
3. Cancellation
Subject to the provisions of the Scheme, the Companies Acts and the New Articles of Association, the B Shares shall be cancelled upon the delivery of the Reduction Court Order to (or, if the Court so orders at the Second Court Hearing, registration by) the Registrar of Companies (the ‘‘Cancellation Time’’). On cancellation of a B Share, Vodafone shall be liable to distribute to each holder of B Shares an amount equal to the Cash Entitlement and the Verizon Consideration Share Entitlement for each B Share held by that holder of B Shares. Vodafone’s obligation to pay such amount to each holder of B Shares shall be discharged by:
(A) the Company paying the Cash Entitlement to the holders of B Shares at the Distribution Record Time out of the capital available for distribution; and
(B) Verizon issuing and delivering the Verizon Consideration Share Entitlement to the holders of B Shares at the Distribution Record Time.
4. Attendance and voting at General Meetings
The holders of B Shares will receive notice of general meetings of Vodafone, and will be able to attend, speak and vote at such general meetings, only if a resolution is to be proposed at the general meeting to wind up Vodafone, in which case the holders of B Shares will receive notice of the general meeting and will have the right to attend, speak and vote on that resolution only.
If the holders of the B Shares are entitled to vote at a general meeting of Vodafone, each holder present in person or by proxy (or, being a company, by representative) will have one vote on a show of hands, and on a poll every holder who is present in person or by proxy (or, being a company, by a company representative) will have one vote for each fully paid B Share.
5. Purchase of Shares
Vodafone will not require the sanction or the consent of the holders of B Shares for the purchase or redemption of shares of any class in Vodafone (including, without limitation, Fixed Rate Shares, New Ordinary Shares, B Shares, C Shares and/or Deferred Shares).
6. Class Rights
Vodafone may from time to time issue new shares which have rights or restrictions attaching to them. The rights of the new shares can take priority over the rights of the B Shares. The issue of any such new shares will be in accordance with the rights attaching to the B Shares and will not involve a variation of those rights or require the consent of holders of the B Shares.
Vodafone may reduce the share capital paid up or treated as paid up on the B Shares in any way (in accordance with the Companies Act). Any such reduction will be in accordance with the rights attaching to the B Shares and will not involve a variation of those rights. Vodafone can reduce its capital (in accordance with the Companies Act) at any time without the consent of the holders of the B Shares including by paying to the holders of the B Shares the preferential amounts they are entitled to as set out in paragraph 2 above.
7. Form
Subject to the provisions of the New Articles of Association which may be applicable, the B Shares shall be non-transferrable.
8. Other
If the Capital Reductions are not confirmed by the Court by the date falling 21 Business Days following the issue of the B Shares, the B Shares shall automatically be reclassified as deferred B Shares (the ‘‘Deferred B Shares’’). The Deferred B Shares will have with the same rights and restrictions as the Deferred Shares, which are summarised in Section 3 of this Part VI, but the nominal value of a Deferred B Share will be the same as the nominal value of a B Share rather than the nominal value of a Deferred Share.
SECTION 2
Rights and Restrictions Attached to the C Shares
The following summarises the rights of the C Shares and the restrictions to which they are subject, which are reflected in the New Articles of Association of Vodafone.
1. Income
Subject to the provisions of the Scheme, the Companies Act and the New Articles of Association, the Special Dividend shall become due to each holder of C Shares at the Distribution Record Time to be satisfied and effected by:
(A) the Company paying the Cash Entitlement to the holders of C Shares at the Distribution Record Time out of the profits available for distribution; and
(B) Verizon issuing and delivering the Verizon Consideration Share Entitlement to the holders of C Shares at the Distribution Record Time.
The Special Dividend shall become payable at the Cancellation Time (as defined in Section 1 of this Part VI).
Each C Share in respect of which the Special Dividend is paid shall immediately thereupon be reclassified as a deferred share of $0.00001 in the capital of the Company, having the rights and being subject to the restrictions summarised in Section 3 of this Part VI (a ‘‘Deferred Share’’).
The C Shares will not confer any other right to share in Vodafone’s profits.
2. Capital
If Vodafone is wound up (but in no other circumstances involving a repayment of capital or distribution of assets to Shareholders whether by reduction of capital, redeeming or buying back shares or otherwise), the holders of C Shares will be entitled, before any payment to the holders of the New Ordinary Shares but after any payment to the holders of the Fixed Rate Shares, to payment of an amount equal to the amount paid up or treated as paid up on the nominal value of each B Share. The aggregate entitlement of each holder of C Shares on a winding-up in respect of all of the C Shares held by that holder of C Shares will be rounded down to the nearest whole penny.
The holders of C Shares will not have any other right to share in Vodafone’s surplus assets. If there is a winding-up and there is not enough to pay the amounts due on the C Shares, the holder of the C Shares will share what is available in proportion to the amounts to which they would otherwise be entitled. The C Shares shall rank pari passu with the B Shares as regards the sums received by them on a return of capital on a winding-up.
3. Attendance and voting at General Meetings
The holders of C Shares will receive notice of general meetings of Vodafone, and will be able to attend, speak and vote at such general meetings, only if a resolution is to be proposed at the general meeting to wind up Vodafone, in which case the holders of C Shares will receive notice of the general meeting and will have the right to attend, speak and vote on that resolution only.
If the holders of the C Shares are entitled to vote at a general meeting of Vodafone, each holder present in person or by proxy (or, being a company, by representative) will have one vote on a show of hands, and on a poll every holder who is present in person or by proxy (or, being a company, by a company representative) will have one vote for each fully paid C Share.
4. Purchase of Shares
Vodafone will not require the sanction or the consent of the holders of C Shares for the purchase or redemption of shares of any class in Vodafone (including, without limitation, Fixed Rate Shares, New Ordinary Shares, B Shares, C Shares or Deferred Shares).
5. Class Rights
Vodafone may from time to time issue new shares which have rights or restrictions attaching to them. The rights of the new shares can take priority over the rights of the C Shares. The issue of any such new shares will be in accordance with the rights attaching to the C Shares and will not involve a variation of those rights or require the consent of holders of the C Shares.
Vodafone may reduce the share capital paid up or treated as paid up on the C Shares in any way (in accordance with the Companies Act). Any such reduction will be in accordance with the rights attaching to the C Shares and will not involve a variation of those rights. Vodafone can reduce its capital (in accordance with the Companies Act) at any time without the consent of the holders of the C Shares including by paying to the holders of the C Shares the preferential amounts they are entitled to as set out in paragraph 2 above.
6. Form
Subject to the provisions of the New Articles of Association which may be applicable, the C Shares shall be non-transferrable.
7. Other
If the Capital Reductions are not confirmed by the Court by the date which falls 21 Business Days following the issue of the C Shares, the C Shares shall automatically be reclassified as Deferred Shares with the rights and restrictions set out in Section 3 of this Part VI.
SECTION 3
Rights and restrictions attaching to the Deferred Shares
The following summarises the rights of the Deferred Shares and the restrictions to which they are subject. These are reflected in the New Articles of Association.
1. Income
The Deferred Shares will confer no right to share in Vodafone’s profits.
2. Capital
(A) If Vodafone is wound up (but in no other circumstances involving a repayment of capital or distribution of assets to Shareholders whether by reduction of capital, redeeming or buying back shares or otherwise), the holders of Deferred Shares will be entitled to the amount paid up or treated as paid up on the nominal value of each Deferred Share after:
(i) first, paying to the holders of Fixed Rate Shares the amount paid up or treated as paid up on the nominal value of each Fixed Rate Share, together with any dividend, arrears of dividend or proportion of any dividend to which they are entitled under the New Articles of Association; (ii) secondly, paying to the holders of B Shares the amount paid up or treated as paid up on the
nominal value of each B Share and paying to the holders of C Shares any outstanding entitlement to the Special Dividend immediately before the winding-up; and
(iii) thirdly, paying to the holders of Ordinary Shares the amount paid up or treated as paid up on the nominal value of each Ordinary Share together with £100,000,000,000 on each Ordinary Share. (B) The holders of Deferred Shares have no further right to share in Vodafone’s surplus assets.
3. Repurchase
Vodafone may, at any time (in accordance with the Companies Act and the provisions of the New Articles of Association) without prior notice, repurchase and cancel all Deferred Shares for a total price of not more than one cent for all Deferred Shares repurchased.
4. Attendance and voting at general meetings
The holders of the Deferred Shares will not receive notice of any general meeting of Vodafone or be able to attend, speak or vote at any general meeting.
5. Form
The Deferred Shares will not be listed on any stock exchange and no share certificates will be issued for the Deferred Shares. The Deferred Shares will not be transferable except in accordance with paragraph 7 below or with the written consent of the Directors.
6. Class rights
(A) Vodafone may from time to time issue new shares which have rights or restrictions attaching to them. The rights of the new shares can take priority over the rights of the Deferred Shares. The issue of any such new shares will be in accordance with the rights attaching to the Deferred Shares and will not involve a variation of those rights or require the consent of the holders of the Deferred Shares. (B) Vodafone may reduce the share capital paid up or treated as paid up on the Deferred Shares in any
way (in accordance with the Companies Act). Any such reduction will be in accordance with the rights attaching to the Deferred Shares and will not involve a variation of those rights. Vodafone can reduce its capital (in accordance with the Companies Act) at any time without the consent of the holders of the Deferred Shares.
7. Transfer and purchase
Vodafone may at any time (in accordance with the Companies Act) without the consent of the holders of the Deferred Shares:
(A) appoint any person to sign (on behalf of the holders of the Deferred Shares) a transfer of all or any part of their holding to Vodafone or any other person the Directors decide (whether or not an officer of Vodafone), for a total price of not more than $0.01 for all Deferred Shares (and Deferred B Shares, if any) transferred, and without needing to account for such amount to any holder of Deferred Shares (or Deferred B Shares, if any); and
PART VII – FINANCIAL INFORMATION