Addendum to 2009 Annual Report
Corporate Governance
ASX Market Supervision Pty Ltd (ASX MS) has undertaken a review of the Company’s compliance with listing rule 6.9 in respect of the two management shares Charter Pacific Corporation Limited (Charter) has on issue.
Under listing rule 6.9.1 listed entities are permitted to have on issue shares with voting rights that do not comply with listing rule 6.9 that were on issue before the first general meeting of the entity held after 1 July 1993.
Since the management shares now on issue are the same shares that were on issue at the time of Charter’s admission to the main board of ASX in 1992 and there have been no changes to the terms of those management shares or the issue of any new management shares, the existence of these management shares is not inconsistent with listing rule 6.9.1.
Following this review both Charter and ASX MS thought it appropriate that existing disclosure in respect of these shares be refreshed and for that purpose Charter provides the following information:
1. There are two management shares on issue in the Company.
2. The voting rights applying to the management shares are contained in paragraph 4.5 of the Company’s Constitution. The holder of the management shares when present in person or by proxy or attorney at any general meeting of the Company is on a poll or any resolution entitled to as many votes as shall together with votes which the holder may exercise in respect of the shares held solely by him in his own capacity and not as trustee, attorney or otherwise as shall institute thirty per centum (30%) of the votes given personally or by proxy or attorney on such resolution.
3. The terms of the management shares have not changed during the current financial year.
4. On pages 6 to 17 of the Charter’s 2009 annual report the Company has set out its corporate governance policies. By way of addendum to that report the Charter Board adds the following statement:
Charter has a number of strategic medium and long term investments and is constantly reviewing additions to that portfolio. As a consequence of its investment approach the Board considers the ongoing inclusion of the management shares as part of its capital structure to be appropriate and beneficial for shareholders for the following reasons.
- Because of the long term nature of the Company’s investment activities the true value of its investments are not always reflected in its share price which could lead, in other structures, to takeover activity at less than fair value;
- Provides the Company with a stable governance structure to move forward whilst it has a relatively small capital base; and
- Allows capital to be raised without destabilising the management and Board structure.