United States
United Kingdom
Canada
Rest of WorldRule 26 of the AIM Rules for Companies
Purpose
This information is being disclosed for the purpose of Rule 26 of the AIM rules for Companies.
Last Updated
This information has been last updated in February 2008.
Description of the BusinessNames and Biographical details of the Company’s Directors
Responsibilities of the Board and details of any Committees and their Responsibilities
Principles of good governance
The Group’s board appreciates the value of good corporate governance not only in terms of accountability and risk management but also as a positive contribution to business prospects. It believes that corporate governance involves more than a simple box ticking approach to establish whether a Company has met the principles (including those set out in the corporate governance guidelines for AIM companies published by the Quoted Companies Alliance in July 2005) of a number of specific rules and regulations. Rather, the issue is one of applying corporate governance in a sensible and pragmatic fashion having regard to the individual circumstances of a particular company’s business. The key objective is to embrace and protect shareholder value.
The Board
The specific responsibilities reserved to the board include: setting group strategy and approving an annual budget and medium–term projections; reviewing operational and financial performance; approving major acquisitions, divestments and capital expenditure; reviewing the group’s systems of financial control and risk management; ensuring that appropriate management development and succession plans are in place; reviewing the environmental, health and safety performance of the group; approving appointments to the board and the Company Secretary; approving policies relating to directors’ remuneration and the severance of directors’ contracts; and ensuring that a satisfactory dialogue takes place with shareholders.
The board has delegated the following responsibilities to Executive Management: the development and recommendation of strategic plans for consideration by the board that reflect the longer term objectives and priorities established by the board; implementation of the strategies and policies of the group as determined by the board; monitoring of the operating and financial results against plans and budgets; monitoring the quality of the investment process against objectives; prioritising the allocation of capital, technical and human resources; monitoring the composition and terms of reference of divisional management committees; and developing and implementing risk management systems.
Directors and directors’ independence
The board currently comprises the Chairman, who is an executive director, four non-executive directors and a further three executive directors. For a full list of the directors, please see “Directors” link under “Investor relations”. The non-executive directors are of sufficient calibre that their views carry significant weight in the board’s decision making.
The directors are given access to independent professional advice at the group’s expense, when the directors deem it is necessary in order for them to carry out their responsibilities. The board considers all its non-executive directors to be independent notwithstanding the shareholdings shown in this report.
Professional development
On appointment, the directors take part in an induction programme when they receive information about the group, the role of the board and the matters reserved for its decision, the terms of reference and membership of the principal board and management committees, and the powers delegated to those committees, the group’s corporate governance practices and procedures, including the powers reserved for the group’s most senior executives, and the latest financial information about the group. This is supplemented by visits to key locations and meetings with other key senior executives. Throughout their period in office the directors are continually updated on the group’s business, the competitive and regulatory environments in which it operates, corporate social responsibility matters and other changes affecting the group and the industry in which it operates as a whole, by written briefings andmeetings with senior executives.
Relations with shareholders
The Chairman gives feedback to the board on issues raised with him by major shareholders as suggested by the new Combined Code. Effective two-way communication with fund managers, institutional investors and analysts is actively pursued and this encompasses issues such as performance, policy and strategy. During the period the Directors have had meetings with analysts and institutions and will continue to do so.
The group maintains a corporate website (www.freeplayenergy.com) containing a wide range of information of interest to institutional and private investors. The group has frequent discussions with institutional shareholders on a range of issues affecting its performance. These include meetings following the announcement of the annual results with the group’s largest institutional shareholders on an individual basis. In addition, the group responds to individual ad hoc requests for discussions from institutional shareholders. There is also an opportunity, at the Company’s Annual General Meeting for individual shareholders to raise general business matters with the full Board and notice of the Company’s Annual General Meeting is circulated to all shareholders at least 20 working days before such meeting.
Internal control
In accordance with the guidance of the Turnbull Committee the board of directors is responsible for the group’s system of internal control; sets appropriate policies on internal control; seeks regular assurance that enables it to satisfy itself that the system is functioning effectively; and ensures that the system of internal control is effective in managing risks in the manner which it has approved.
The directors continue to review the effectiveness of the group’s system of financial and non-financial controls, including operational and compliance controls, risk management and the group’s high level internal control arrangements. These reviews include an assessment of internal controls and, in particular, internal financial controls.
The group views the careful management of risk as a key management activity. Managing business risk to deliver opportunities is a key element of all activities. These business risks, which may be strategic, operational, reputational, financial or environmental, should be understood and visible. The group does not have an internal audit function and the board will consider the need to create one as the group grows. There are no significant issues disclosed in the financial statements for the period ended 31 December 2006 and up to the date ofapproval of the report and financial statements that have required the board to deal with any material internal control issues.
Remuneration committee
The group has established a remuneration committee, which will continue to operate with formally delegated duties and responsibilities. The remuneration committee comprises William Barrett, Gordon Roddick, and Andy Polansky. The remuneration committee meets twice during the year; where, if necessary, non-committee members are invited to attend. The committee’s principal responsibilities are:
- setting, reviewing and recommending to the board for approval the group’s overall remuneration policy and strategy;
- setting, reviewing and approving individual remuneration packages for executive directors and the Chairman, including terms and conditions of employment and any changes to the packages;
- reviewing the salary structure and terms, conditions and benefits of employment of other group executive committee members; and
- approving the rules, and launch, of any executive share, share option or cash based incentive scheme and the grant, award, allocation or issue of shares, share options or payments under such scheme.
In addition the committee regularly reviews the group’s remuneration policy in relation to:
- its competitors and industry norms;
- compensation commitment; and
- contract periods.
The audit committee
The audit committee comprises Edward Barrett and Harold Reiter.
The audit committee meets at least once during the year. Under its terms of reference, the audit committee monitors the integrity of the group’s financial statements and any formal announcements relating to the group’s performance. The committee is responsible for monitoring the effectiveness of the external audit process and making recommendations to the board for ensuring that an appropriate relationship between the group and the external auditors ismaintained, including reviewing non-audit services and fees.
The committee meets with executive directors and management, as well as privately with the external auditors. In 2006 the audit committee discharged its responsibilities by:
- reviewing the group’s draft financial statements prior to board approval and reviewing the external auditors’ detailed reports thereon;
- reviewing the appropriateness of the group’s accounting policies;
- reviewing and approving the audit fee and reviewing non-audit fees payable to the group’s external auditors;
- reviewing the external auditors’ plan for the audit of the group’s financial statements, which included scope of work, key risks to the financial statements, confirmation of auditor independence and approving the terms of engagement for the audit; and
- reviewing the performance of the external auditors.
Auditors’ independence and objectivity
The audit committee reviews all services being provided by the external auditors to review the independence and objectivity of the external auditors, taking into consideration relevant professional and regulatory requirements, so that these are not impaired by the provision of permissible non-audit services. Details of the amounts paid to the external auditors are set out in the 2006 annual financial statements.
Company’s country of incorporation and main countries of operation
Freeplay Energy plc is incorporated and registered in England and Wales under the Companies Act 1985 with registered number 4220065.
The main country of operation is defined as the geographical location from which Freeplay Energy Plc derives the largest proportion of its revenues. The main countries of operation are various countries in Africa and the USA.
Certificate of IncorporationPlease note that the company changed its name from Fieldbury PLC to Freeplay Energy PLC in 2002.
Articles of Association31 December 2006 Annual Financial Statements
Notifications made
Most recent AIM Admission document
Freeplay Energy plc does not trade on any exchange other than AIM.
Nominated and Key AdvisorsAIM Securities in Issue as at 11 January 2008
5p ordinary shares issued: 96 864 559
45p deferred shares issued: 1 730 098
Major interests in shares
At 11 January 2008, the following shareholders held interests in shares in excess of 3% of ordinary share capital:
| % shareholding | No. of 5p ordinary shares | ||
| Barrett Marketing Group Limited | 23.67% | 22 924 984 | |
| Sherfam Inc. | 10.12% | 9 803 920 | |
| Gordon Roddick | 9.28% | 8 988 921 | |
| Rory Stear | 8.69% | 8 416 379 | |
| Merrill Lynch Custodian | 6.58% | 6 371 000 | |
| Vincent Mai | 5.22% | 5 060 821 | |
| Blackrock Investment Management | 5.03% | 4 878 752 | |
| Allianz Global Investors | 3.84% | 3 723 500 | |
| Bank of New York Nominees | 3.75% | 3 174 000 | |
| General Electric Pension Trust | 3.04% | 2 949 317 |
The % of shares not held in public hands is 43%.
Disclaimer