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Guidance Notes on Paragraph 21

It is essential when determining the result of an offer under the Takeover Rules that appropriate measures are adopted such that all parties to the offer may be confident that the result of the offer is arrived at by an objective procedure which, as far as possible, eliminates areas of doubt. This Guidance is designed to ensure that those acceptances and purchases which may be counted towards fulfilling the acceptance condition and thus included in the certificate are properly identified. Receiving agents are also required to establish appropriate procedures such that acceptances and purchases can be checked against each other and between different categories so that no shareholding will be counted twice.

The principles and procedures outlined in this Guidance are, except with the prior consent of the Panel, to be followed in all cases. It must be understood that the Panel expects co-operation between the Target's registrar and the Bidder's receiving agent to ensure that the procedures can be undertaken in a timely manner. Co- operation is interpreted to include the provision of data in a form convenient for the receiving agent. For example, if the receiving agent so requests, following the announcement of an offer, the registrar should, if practicable, provide the register in electronic form. Whenever possible, if requested to do so, the registrar should provide, in similar form, details of changes to the register rather than a complete new register.

Receiving agents will have direct access to the Panel should they believe that there is insufficient co-operation or that they are being given instructions contrary to this Guidance.

Qualifications for acting as a receiving agent

A receiving agent to an offer must either have performed the duties of a receiving agent on more than 25 occasions or be an organisation which has satisfied the Panel that it has the experience and resources necessary to act as receiving agent in connection with the relevant offer.

The provision of the Target's register

(a) When a firm intention to make an offer is announced, the Target should instruct its registrar to respond within two business days to a request from the Bidder for the provision of the register which should be updated to reflect the position as at the close of business on the date of the request.
(b) The Target's registrar should also be instructed to keep the register as up-to-date as the register maintenance system will allow. The updating procedures should include, in addition to the registration of transfers, the registration of all changes affecting the register (eg grants of representation, marriage certificates, changes of address, court orders etc.).

As far as certificated holdings are concerned, the registrar must provide updates, on a daily basis, to the register within two business days after notification of the transfer and, in addition, copies of all documents, which would lead to a change in the last copy register provided to the Bidder must be provided as rapidly. On the final register day* any such information received by the Target's registrar but not yet provided to the Bidder's receiving agent must be made available electronically, where possible, or for collection by the Bidder's receiving agent, at the latest, by noon on the day preceding the final closing date† of the offer.

From the final register day* until the time that the offer becomes or is declared unconditional as to acceptances or lapses, the Target's registrar should continue to update the register on a daily basis so that all transfers and other documents which have been received by the Target's registrar by 1.00 pm on the final closing date† of the offer are processed by 5.00 pm that day at the latest. In addition, copies of these documents should be sent immediately and electronically, where possible, to the Bidder's receiving agent insofar as not previously notified.
(d) Arrangements should be made to ensure that the Bidder's receiving agent has access to the Target's registrar at all times, which includes weekends and Bank Holidays, during the period between the final register day* and the time the offer becomes or is declared unconditional as to acceptances or lapses, in order that any queries arising from acceptances and purchases can be investigated and accurate decisions taken.

*† See definitions at end of Guidance

The provision of addresses, electronic addresses, elections and other details

(a) When a firm intention to make an offer is announced, the Target should respond, or instruct its registrar to respond, within two business days to a request from the Bidder for details in respect of:
(i) electronic addresses provided to the Target by shareholders in the Target for the receipt of documents, announcements and other information in electronic form;
(ii) addresses, electronic addresses and other information provided to the Target by, or on behalf of, persons with information rights for the receipt of documents, announcements and other information in hard copy form or electronic form;
(iii) addresses, electronic addresses and other information provided to the Target by any other persons entitled to receive copies of documents, announcements or information for the receipt of such communications in hard copy form or electronic form (including a copy of any register(s) of persons entitled to receive documents under Paragraph 15); and
(iv) elections made in accordance with applicable legal or regulatory provisions by, or on behalf of, shareholders in the Target, persons with information rights or any other relevant persons to receive communications from the Target in hard copy form,

provided, in each case, that the relevant address, electronic address, election or other information has been provided to the Target for the receipt of information generally and not only for certain specific types of information.
(b) The information provided to a Bidder in compliance with (a) above should be updated to reflect the position as at the close of business on the day of the request. The Target shall ensure, or shall instruct its registrar to ensure, that the information described in (a) above is kept as up-to-date as the relevant maintenance system will allow and updates shall be provided to the Bidder, or its receiving agent, in respect of any changes in that information at the same time as updates to the company's register are provided as required above to the Bidder's receiving agent.
(c) When the information referred to in (a) above is provided to a Bidder by the Target or its registrar, the use of that information by the Bidder for purposes that are not related to the offer may be subject to legal restrictions, including in relation to the protection of data.

Counting of acceptances

The Bidder's receiving agent must ensure that all acceptances counted as valid meet the requirements set out Paragraph 10 and any guidance issued thereunder.

Counting of purchases

The Bidder's receiving agent must ensure that all purchases counted as valid meet the requirements set out Paragraph 10 and any guidance issued thereunder.

Offers becoming or being declared unconditional as to acceptances before the final closing date†

Prior to an offer becoming or being declared unconditional as to acceptances before the final closing date†, the Bidder's receiving agent must ensure that the requirements set out in Paragraph 10 and any guidance issued thereunder have been satisfied.

Disclaimers in receiving agents' certificates

Where guidance issued under Paragraph 10 requires a certificate to be issued by a receiving agent, such certificate should be unqualified, save for a disclaimer (if necessary) as to limitations on the responsibility of the receiving agent for the errors of third parties which are not evident from the documents available to the receiving agent. A disclaimer in the following form would normally be acceptable; any variation should be specifically agreed by the Panel in advance:

"In issuing this certificate we have, where necessary, relied on the following matters:

(i) certifications of acceptance forms by the Target's registrar; and
(ii) certifications by the Target's registrar that a transfer of shares has been executed by or on behalf of the registered holder in favour of the Bidder or its nominees.

As the Bidder's receiving agent and escrow agent, we have examined with due care and attention the information provided to us, and, as appropriate, made due and careful enquiry of relevant persons, in order that we may issue this certificate and have no reason to believe that the information contained in it cannot be relied upon but, subject thereto, we accept no responsibility or liability whatsoever in respect of any error of the Target's registrar or the Bidder's buying broker for the matters set out above to the extent that we have relied upon them in issuing this certificate."

*final register day — the day two days prior to the final closing date† of an offer.

†final closing date — the 60th day or other date beyond which the Bidder has stated that its offer will not be extended.