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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 6-K

Report of Foreign Private Issuer Pursuant to Rule 13a-16 or 15d-16

under the Securities Exchange Act of 1934

For the Month of August 2015

1-15240

(Commission File Number)

JAMES HARDIE INDUSTRIES plc

(Translation of registrant’s name into English)

Europa House, Second Floor

Harcourt Centre

Harcourt Street, Dublin 2, Ireland

(Address of principal executive offices)

Indicate by check mark whether the registrant files or will file annual reports under cover Form 20-F or

Form 40-F.

Form 20-F..X.... Form 40-F........

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1): Not Applicable

Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): Not Applicable


Table of Contents

TABLE OF CONTENTS

 

Forward-Looking Statements

     3   

Exhibit Index

     4   

Signatures

     5   

 

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Forward-Looking Statements

This Form 6-K contains forward-looking statements. James Hardie Industries plc (the “company”) may from time to time make forward-looking statements in its periodic reports filed with or furnished to the Securities and Exchange Commission, on Forms 20-F and 6-K, in its annual reports to shareholders, in offering circulars, invitation memoranda and prospectuses, in media releases and other written materials and in oral statements made by the company’s officers, directors or employees to analysts, institutional investors, existing and potential lenders, representatives of the media and others. Statements that are not historical facts are forward-looking statements and such forward-looking statements are statements made pursuant to the Safe Harbor Provisions of the Private Securities Litigation Reform Act of 1995.

Examples of forward-looking statements include:

 

   

statements about the company’s future performance;

   

projections of the company’s results of operations or financial condition;

   

statements regarding the company’s plans, objectives or goals, including those relating to strategies, initiatives, competition, acquisitions, dispositions and/or its products;

   

expectations concerning the costs associated with the suspension or closure of operations at any of the company’s plants and future plans with respect to any such plants;

   

expectations concerning the costs associated with the significant capital expenditure projects at any of the company’s plants and future plans with respect to any such projects;

   

expectations regarding the extension or renewal of the company’s credit facilities including changes to terms, covenants or ratios;

   

expectations concerning dividend payments and share buy-backs;

   

statements concerning the company’s corporate and tax domiciles and structures and potential changes to them, including potential tax charges;

   

statements regarding tax liabilities and related audits, reviews and proceedings;

   

expectations about the timing and amount of contributions to Asbestos Injuries Compensation Fund (AICF), a special purpose fund for the compensation of proven Australian asbestos-related personal injury and death claims;

   

expectations concerning indemnification obligations;

   

expectations concerning the adequacy of the company’s warranty provisions and estimates for future warranty-related costs;

   

statements regarding the company’s ability to manage legal and regulatory matters (including but not limited to product liability, environmental, intellectual property and competition law matters) and to resolve any such pending legal and regulatory matters within current estimates and in anticipation of certain third-party recoveries; and

   

statements about economic conditions, such as changes in the US economic or housing recovery or changes in the market conditions in the Asia Pacific region, the levels of new home construction and home renovations, unemployment levels, changes in consumer income, changes or stability in housing values, the availability of mortgages and other financing, mortgage and other interest rates, housing affordability and supply, the levels of foreclosures and home resales, currency exchange rates, and builder and consumer confidence.

Words such as “believe,” “anticipate,” “plan,” “expect,” “intend,” “target,” “estimate,” “project,” “predict,” “forecast,” “guideline,” “aim,” “will,” “should,” “likely,” “continue,” “may,” “objective,” “outlook” and similar expressions are intended to identify forward-looking statements but are not the exclusive means of identifying such statements. Readers are cautioned not to place undue reliance on these forward-looking statements and all such forward-looking statements are qualified in their entirety by reference to the following cautionary statements.

Forward-looking statements are based on the company’s current expectations, estimates and assumptions and because forward-looking statements address future results, events and conditions, they, by their very nature, involve inherent risks and uncertainties, many of which are unforeseeable and beyond the company’s control. Such known and unknown risks, uncertainties and other factors may cause actual results, performance or other achievements to differ materially from the anticipated results, performance or achievements expressed, projected or implied by these forward-looking statements. These factors, some of which are discussed under “Risk Factors” in Section 3 of the Form 20-F filed with the Securities and Exchange Commission on 21 May 2015, include, but are not limited to: all matters relating to or arising out of the prior manufacture of products that contained asbestos by current and former company subsidiaries; required contributions to AICF, any shortfall in AICF and the effect of currency exchange rate movements on the amount recorded in the company’s financial statements as an asbestos liability; governmental loan facility to AICF; compliance with and changes in tax laws and treatments; competition and product pricing in the markets in which the company operates; the consequences of product failures or defects; exposure to environmental, asbestos, putative consumer class action or other legal proceedings; general economic and market conditions; the supply and cost of raw materials; possible increases in competition and the potential that competitors could copy the company’s products; reliance on a small number of customers; a customer’s inability to pay; compliance with and changes in environmental and health and safety laws; risks of conducting business internationally; compliance with and changes in laws and regulations; the effect of the transfer of the company’s corporate domicile from the Netherlands to Ireland, including changes in corporate governance and any potential tax benefits related thereto; currency exchange risks; dependence on customer preference and the concentration of the company’s customer base on large format retail customers, distributors and dealers; dependence on residential and commercial construction markets; the effect of adverse changes in climate or weather patterns; possible inability to renew credit facilities on terms favorable to the company, or at all; acquisition or sale of businesses and business segments; changes in the company’s key management personnel; inherent limitations on internal controls; use of accounting estimates; and all other risks identified in the company’s reports filed with Australian, Irish and US securities agencies and exchanges (as appropriate). The company cautions you that the foregoing list of factors is not exhaustive and that other risks and uncertainties may cause actual results to differ materially from those referenced in the company’s forward-looking statements. Forward-looking statements speak only as of the date they are made and are statements of the company’s current expectations concerning future results, events and conditions. The company assumes no obligation to update any forward-looking statements or information except as required by law.

 

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EXHIBIT INDEX

 

Exhibit No.

  

Description

99.1    ASX cover 30 June 2015
99.2    Media Release Q1 FY16
99.3    Management Analysis Q1 FY16
99.4    Management Presentation Q1 FY16
99.5    Financial Statements
99.6    2015 AGM Presentation
99.7    Chairman’s Address
99.8    2015 AGM Results Announcement
99.9    Amended Memorandum and Articles of Association of James Hardie Industries plc
99.10   

Amended and Restated James Hardie Industries plc Long Term Incentive Plan 2006

 

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SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

 

    James Hardie Industries plc
Date:    17 August 2015     By: /s/ Natasha Mercer
    Natasha Mercer
    Company Secretary

 

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EXHIBIT INDEX

 

Exhibit No.

  

Description

99.1    ASX cover 30 June 2015
99.2    Media Release Q1 FY16
99.3    Management Analysis Q1 FY16
99.4    Management Presentation Q1 FY16
99.5    Financial Statements
99.6    2015 AGM Presentation
99.7    Chairman’s Address
99.8    2015 AGM Results Announcement
99.9    Amended Memorandum and Articles of Association of James Hardie Industries plc
99.10   

Amended and Restated James Hardie Industries plc Long Term Incentive Plan 2006

Exhibit 99.1

Results for Announcement to the Market

James Hardie Industries plc

ARBN 097 829 895

 

Three Months Ended 30 June 2015

Key Information

   Three Months Ended 30 June
     2016

US$M

   2015

US$M

   Movement

Net Sales From Ordinary Activities

   428.3    416.8    UP      3.0%

Profit From Ordinary Activities After Tax Attributable to Shareholders

   60.0    28.9    UP      N/A

Net Profit Attributable to Shareholders

   60.0    28.9    UP      N/A

Net Tangible (Liabilities) Assets per Ordinary Share

   US$(0.80)      US$(0.90)      UP      11.0%

Dividend Information

 

 

A special dividend of US22.0 cents per security (“FY2015 special dividend”) and an FY2015 second half ordinary dividend of US27.0 cents per security (“FY2015 second half dividend”) were paid to share/CUFS holders on 07 August 2015.

 

 

The record date to determine entitlements to the FY2015 special dividend and FY2015 second half dividend was 11 June 2015 (on the basis of proper instruments of transfer received by the Company’s registrar, Computershare Investor Services Pty Ltd, Level 4, 60 Carrington Street, Sydney NSW 2000, Australia, by 5:00pm if securities are not CHESS approved, or security holding balances established by 5:00pm or such later time permitted by ASTC Operating Rules if securities are CHESS approved).

 

 

The company was required to deduct Irish DWT (currently 20% of the gross dividend amount) from these dividends and future dividends, unless the beneficial owner has completed and returned a non-resident declaration form (DWT Form).

 

 

The Australian currency equivalent amount of the FY2015 special and FY2015 second half dividends paid to CUFS holders on 7 August 2015 converted to a combined dividend payment of 63.0826 Australian cents per CUFS.

 

 

No dividend reinvestment plan is currently in operation for dividends previously announced and paid by the Company.

Movements in Controlled Entities during three months ended 30 June 2015

There were no movements in controlled entities during three months ended 30 June 2015.

Audit

The results and financial information included within this Preliminary Final Report have been prepared using US GAAP and have been subject to an independent audit by external auditors.

Results for the 1st Quarter Ended 30 June 2015

Contents

 

  1.

Media Release

  2.

Management’s Analysis of Results

  3.

Management Presentation

  4.

Consolidated Financial Statements

James Hardie Industries plc is incorporated under the laws of Ireland with its corporate seat in Dublin, Ireland. The liability of members is limited. The information contained in the above documents should be read in conjunction with the James Hardie 2015 Annual Report which can be found on the company website at www.jameshardie.com .

Exhibit 99.2

 

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James Hardie Announces Adjusted Net Operating Profit 1

of US$63.5 Million for Fiscal 2016 First Quarter

 

 

James Hardie today announced results for the quarter ended 30 June 2015:

 

   

Group Adjusted net operating profit 1 of US$63.5 million, an increase of 27% compared to the prior corresponding period (“pcp”);

   

Group Adjusted EBIT 1 of US$89.7 million, an increase of 26% compared to pcp;

   

Group net sales of US$428.3 million, an increase of 3% compared to pcp;

   

USA and Europe Fiber Cement Segment net sales of US$337.0 million, an increase of 5% compared to pcp;

   

USA and Europe Fiber Cement Segment EBIT margin of 26.6%;

   

Asia Pacific Fiber Cement Segment EBIT margin 1 of 21.4%;

   

Contribution of US$62.8 million to AICF on 1 July 2015; and

   

Subsequent to period end, repurchased approximately 1.7 million shares, at an aggregate cost of US$22.5 million, under the previously announced share buyback program.

CEO Commentary

 

 

James Hardie CEO Louis Gries said: “During the first quarter of fiscal year 2016, all of our businesses delivered higher volumes, higher average selling prices in local currency and higher EBIT in local currency compared to the prior corresponding period. Our Adjusted net operating profit of US$63.5 million is the highest first quarter result since fiscal year 2007, largely driven by the operating results of our USA and Europe Fiber Cement segment.”

He continued, “The USA and Europe segment result is primarily driven by lower production costs, due to the continued focus on operating performance, further aided by deflationary trends in markets for our key inputs and freight. In local currency, our Asia Pacific Fiber Cement segment provided a strong result, however, the 17% appreciation of the US dollar over the period had an adverse impact on the group’s consolidated results.”

Mr. Gries concluded, “From a capital structure and allocation perspective, we have maintained a conservative level of debt, within our stated financial framework, and subsequent to quarter end, we purchased approximately 1.7 million shares of our common stock with an aggregate cost of US$22.5 million. Additionally, on 1 July 2015, we made a payment of US$62.8 million to AICF, representing 35% of our free cash flow, as defined by the AFFA, for fiscal year 2015.”

1 The Company may present financial measures that are not considered a measure of financial performance under US GAAP and should not be considered to be more meaningful than the equivalent US GAAP measure. Management has included such measures to provide investors with an alternative method for assessing its operating results in a manner that is focused on the performance of its ongoing operations. Additionally, management uses such non-GAAP financial measures for the same purposes. However, these non-GAAP financial measures are not prepared in accordance with US GAAP, may not be reported by all of the Company’s competitors and may not be directly comparable to similarly titled measures of the Company’s competitors due to potential differences in the exact method of calculation. For additional information regarding the Non-GAAP financial measures presented in this Media Release, including a reconciliation of each non-GAAP financial measure to the equivalent US GAAP measure, see the sections titled “Definition and Other Terms” and “Non-US GAAP Financial Measures” included in the Company’s Management’s Analysis of Results for the first quarter ended 30 June 2015.

 

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Outlook

 

 

The Company expects to see moderate growth in the US housing market in fiscal year 2016, assuming new housing construction starts of between 1.1 and 1.2 million. We expect our USA and Europe Fiber Cement Segment EBIT and EBIT margins to be toward the higher end of, and may exceed our stated target range of 20% to 25% for fiscal year 2016, with a likely return to our target range in fiscal year 2017 and beyond. This expectation is based on the assumptions that we continue to achieve strong operating performance in our plants consistent with recent quarters and deflationary to stable input cost trends.

Net sales from the Australian business are expected to grow, tracking in line with expected growth in new detached dwellings and an improving repair and remodel market. Similarly, the New Zealand business is expected to deliver improved results supported by a strong local housing market, particularly in Auckland, although at a more moderate rate of growth than the prior year.

Full Year Earnings Guidance

 

 

Management notes the range of analysts’ forecasts for net operating profit excluding asbestos for the year ending 31 March 2016 is between US$244 million and US$286 million. Management expects full year Adjusted net operating profit to be between US$240 million and US$270 million assuming, among other things, housing conditions in the United States continue to improve in line with our assumed forecasted new construction starts, input prices and production efficiencies remain consistent and an average exchange rate at or near current levels is applicable for the remainder of the year.

The comparable Adjusted net operating profit for fiscal year 2015 was US$221.4 million.

Management cautions that although US housing activity has been improving, market conditions remain somewhat uncertain and some input costs remain volatile. The Company is unable to forecast the comparable US GAAP financial measure due to uncertainty regarding the impact of actuarial estimates on asbestos-related assets and liabilities in future periods.

 

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Further Information

 

 

Readers are referred to the Company’s Condensed Consolidated Financial Statements and Management’s Analysis of Results for the three months ended 30 June 2015 for additional information regarding the Company’s results, including information regarding income taxes, the asbestos liability and contingent liabilities.

Forward-Looking Statements

 

 

This Media Release contains forward-looking statements and information that are necessarily subject to risks, uncertainties and assumptions. Many factors could cause the actual results, performance or achievements of James Hardie to be materially different from those expressed or implied in this release, including, among others, the risks and uncertainties set forth in Section 3 “Risk Factors” in James Hardie’s Annual Report on Form 20-F for the year ended 31 March 2015; changes in general economic, political, governmental and business conditions globally and in the countries in which James Hardie does business; changes in interest rates, changes in inflation rates; changes in exchange rates; the level of construction generally; changes in cement demand and prices; changes in raw material and energy prices; changes in business strategy and various other factors. Should one or more of these risks or uncertainties materialize, or should underlying assumptions prove incorrect, actual results may vary materially from those described herein. James Hardie assumes no obligation to update or correct the information contained in this Media Release except as required by law.

END

 

Media/Analyst Enquiries:

Sean O’ Sullivan Telephone: +61 2 8845 3352

Vice President Investor and Media Relations Email: media@jameshardie.com.au

 

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Exhibit 99.3

 

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Management’s Analysis of Results

 

 

This Management’s Analysis of Results forms part of a package of information about James Hardie Industries plc’s results. It should be read in conjunction with the other parts of this package, including the Media Release, the Management Presentation and the Consolidated Financial Statements. Except as otherwise indicated in this Management’s Analysis of Results, James Hardie Industries plc is referred to as “JHI plc.” JHI plc, together with its direct and indirect wholly-owned subsidiaries, are collectively referred to as “James Hardie,” the “Company,” “we,” “our,” or “us.” Definitions for certain capitalized terms used in this Management’s Analysis and Results can be found in the sections titled “Definitions and Other Terms” and “Non-GAAP Financial Measures.”

These documents, along with an audio webcast of the Management Presentation on 14 August 2015, are available from the Investor Relations area of our website at http://www.ir.jameshardie.com.au

 

Media/Analyst Enquiries:

Sean O’ Sullivan

Vice President Investor and Media Relations

 

Telephone:

  

+61 2 8845 3352

Email:

  

media@jameshardie.com.au

 

In this Management’s Analysis of Results, James Hardie may present financial measures, sales volume terms, financial ratios, and Non-US GAAP financial measures included in the “Definitions and Other Terms”, and “Non-GAAP Financial Measures” sections of this document. We present financial measures that we believe are customarily used by our Australian investors. Specifically, these financial measures, which are equivalent to or derived from certain US GAAP measures as explained in the definitions section, include “EBIT”, “EBIT margin”, “Operating profit before income taxes” and “Net operating profit”. We may also present other terms for measuring our sales volume (“million square feet” or “mmsf” and “thousand square feet” or “msf”); financial ratios (“Gearing ratio”, “Net interest expense cover”, “Net interest paid cover”, “Net debt payback”, “Net debt (cash)”); and Non-US GAAP financial measures (“Adjusted EBIT”, “Adjusted EBIT margin”, “Adjusted net operating profit”, “Adjusted diluted earnings per share”, “Adjusted operating profit before income taxes”, “Adjusted effective tax rate on earnings”, “Adjusted EBITDA” and “Adjusted selling, general and administrative expenses”). Unless otherwise stated, results and comparisons are of the first quarter of the current fiscal year versus the first quarter of the prior fiscal year. For additional information regarding the financial measures presented in this Management’s Analysis of Results, including a reconciliation of each non-GAAP financial measures to the equivalent US GAAP measure, see the sections titled “Definition and Other Terms” and “Non-US GAAP Financial Measures.”

 

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James Hardie Industries plc

Results for the 1st Quarter Ended 30 June

 

US$ Millions    Three Months Ended 30 June
         FY16               FY15             Change  %  
Net sales     $         428.3       $         416.8     
Cost of goods sold      (270.7     (276.6  
Gross profit      157.6        140.2      12 
        
Selling, general and administrative expenses      (61.5     (59.9   (3)
Research and development expenses      (7.1     (8.4   15 
Asbestos adjustments      (4.5     (21.5   79 
EBIT      84.5        50.4      68 
            
Net interest expense      (5.9     (1.1    
Other income (expense)      2.7        (3.7    
Operating profit before income taxes      81.3        45.6      78 
Income tax expense      (21.3     (16.7   (28)
Net operating profit     $ 60.0       $ 28.9       
            
Earnings per share - basic (US cents)      13        6       
Earnings per share - diluted (US cents)      13        6       
        
Volume (mmsf)      599.1        571.8     

 

Net sales for the quarter increased 3% from the prior corresponding period to US$428.3 million. Net sales in local currencies were favorably impacted by higher sales volumes and higher average net sales prices in both the USA and Europe Fiber Cement and the Asia Pacific Fiber Cement segments. Although net price was up in local currencies, volume growth outpaced US dollar net sales growth as a result of the adverse movement in the AUD/USD average exchange rate, and the resulting impact on Asia Pacific Fiber Cement segment US dollar net sales.

Gross profit for the quarter increased 12% from the prior corresponding period to US$157.6 million at a gross profit margin of 36.8%, 3.2 percentage points higher than the prior corresponding period.

Selling, general and administrative (“SG&A”) expenses of US$61.5 million for the quarter increased 3%, when compared with the prior corresponding period. The increase primarily reflects higher General Corporate expenses, driven by higher stock compensation expenses and higher realized losses on foreign currency; partially offset by lower SG&A expenses in the business units.

Research and development (“R&D”) expenses decreased compared to the prior corresponding period primarily due to decreased spending associated with commercialization projects in our business units.

Asbestos adjustments reflect the non-cash foreign exchange translation impact on asbestos related balance sheet items, driven by the change in the AUD/USD spot exchange rate.

Other income (expense) for the quarter reflects unrealized foreign exchange gains and losses, unrealized gains and losses on interest rate swaps and the gain on the sale of the Australian pipes business in the three months ended 30 June 2015.

Net operating profit increased compared to the prior corresponding period, primarily due to the favorable underlying performance of the operating business units, a decrease in unfavorable asbestos adjustments, favorable movement in other expense, which was partially offset by an increase in net interest expense and net income tax expense.

 

 

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USA & Europe Fiber Cement Segment

 

 

Operating results for the USA & Europe Fiber Cement segment were as follows:

 

     Three Months Ended 30 June
    

 

        FY16        

             FY15                  Change    
Volume (mmsf)      480.0         463.3       4%
Average net sales price per unit (per msf)      US$686         US$680       1%
          
Net sales (US$ Millions)      337.0         321.5       5%
Gross profit          19%
Gross margin (%)          4.4 pts
EBIT (US$ Millions)      89.5         68.0       32%
EBIT margin (%)      26.6         21.2       5.4 pts

Net sales for the quarter were favorably impacted by higher volumes and a higher average net sales price. The increase in our sales volume for the quarter compared to the prior corresponding period was primarily driven by modest growth in the repair and remodel market. The increase in our average net sales price reflects the ongoing execution of our pricing strategies, including an annual price increase effective 1 March 2015 and the reduction of pricing inefficiencies; partially offset by product and regional mix, when compared to the prior corresponding period.

We note that there are a number of indicators that measure US housing market growth, most of which have reported between mid-single digit growth and slight contraction in recent quarters when compared to prior corresponding periods. However, at the time of filing our results for the quarter ended 30 June 2015, only US Census Bureau data was available. According to the US Census Bureau, single family housing starts for the quarter were 205,300 or 12%, above the prior corresponding period.

While we have provided US Census Bureau data above, we note that it typically trends higher than other indices we use to measure US housing market growth, namely the McGraw-Hill Construction Residential Starts Data (also known as Dodge), the National Association of Home Builders and Fannie Mae.

The change in gross margin for the quarter can be attributed to the following components:

 

For the three months ended 30 June 2015:       

Higher average net sales price

     1.3     

Lower production costs

     3.1     
  

 

 

 

Total percentage point change in gross margin

         4.4 pts     
  

 

 

 

Production costs in the quarter were lower when compared to the prior corresponding period primarily as a result of continued performance improvement across our network of plants, as well as lower freight costs and lower input costs for pulp and utilities.

EBIT of US$89.5 million for the quarter increased by 32%, compared to the prior corresponding period, reflecting improved plant performance, lower input costs, increased volumes and lower segment SG&A expenses.

 

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SG&A expense decreased primarily due to lower professional fees related to prior period market and product programs that did not recur in the current period. As a percentage of segment sales, SG&A expenses decreased by 0.8 percentage points compared to prior corresponding period.

EBIT margin for the quarter increased 5.4 percentage points to 26.6% from 21.2% in the prior corresponding period primarily driven by improved plant performance, as well as lower input costs, and lower segment SG&A expenses.

Asia Pacific Fiber Cement Segment

 

 

Operating results for the Asia Pacific Fiber Cement segment in US dollars were as follows:

 

   

 

Three Months Ended 30 June

 
        FY16             FY15             Change  

Volume (mmsf)

    119.1        108.5        10%   
         

Net Sales (US$ Millions)

    91.3        95.3        (4%)   

US$ Gross Profit

          (8%)   

US$ Gross Margin (%)

          (1.3 pts)   

EBIT (US$ Millions)

    19.5        22.0        (11%)   

New Zealand weathertightness claims (US$ Millions)

    (0.2)        1.3       

EBIT excluding (US$ Millions) 1

    19.7        20.7        (5%)   

US$ EBIT Margin excluding (%) 1

    21.6        21.7        (0.1 pts)   

1 Excludes New Zealand weathertightness claims

The Asia Pacific Fiber Cement segment results in US dollars were impacted by a 17% unfavorable change in the weighted average period AUD/USD exchange rate relative to the prior corresponding quarter. The weighted average AUD/USD exchange rate for the current period was 0.7779 compared to the rate for the corresponding prior period, 0.9329. The impact of the unfavorable exchange rate movements are detailed in the table below:

 

   

 

Q1 FY16 vs. Q1 FY15

   

    Results in    

AUD

 

    Results in    

USD

 

    Impact of    

foreign
exchange

Net Sales

  p    15%   q      4%   (19 pts)

Gross Profit

  p    10%   q       8%   (18 pts)

EBIT

  p        7%   q     11%   (18 pts)

EBIT excluding 1

  p      15%   q        5%   (20 pts)

1 Excludes New Zealand weathertightness claims

 

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Operating results for the Asia Pacific Fiber Cement segment in Australian dollars were as follows:

 

     Three Months Ended 30 June  
         FY16             FY15          Change  

Volume (mmsf)

     119.1        108.5         10%   

Average net sales price per unit (per msf)

     A$975        A$931         5%   
               

Net Sales (A$ Millions)

     117.4        102.2         15%   

A$ Gross Profit

              10%   

A$ Gross Margin (%)

              (1.4 pts

EBIT (A$ Millions)

     25.1        23.5         7%   

New Zealand weathertightness claims (A$ Millions)

     (0.3     1.4        

EBIT excluding (A$ Millions) 1

     25.4        22.1         15%   

A$ EBIT Margin excluding (%) 1

     21.6        21.6         Flat   

1 Excludes New Zealand weathertightness claims

Net sales in Australian dollars for the quarter increased, largely due to higher sales volumes and higher average net sales price, when compared to prior corresponding period. In our Australian business, the key drivers of net sales growth were favorable conditions in our addressable markets, favorable impact of our price increase and favorable product mix. In our New Zealand business, volume grew across all regions; however, net sales growth was partially offset by a lower average selling price due to product mix. In our Philippines business, net sales were driven higher compared to the prior corresponding period by growth in our addressable markets and continued market penetration.

According to Australian Bureau of Statistics data, approvals for detached houses, which are a key driver of the Asia Pacific business’ sales volume, were 29,343 for the quarter, an increase of 3%, when compared to the prior corresponding period.

According to Statistics New Zealand data, consents for dwellings excluding apartments, which are the primary driver of the New Zealand business’ net sales, were 4,454 for the quarter, a decrease of 2%, when compared to the prior corresponding period.

In Australian dollars, the change in gross margin for the quarter can be attributed to the following components:

 

For the three months ended 30 June 2015:

  

Higher average net sales price

     2.6     

Higher production costs

     (4.0)    
        

Total percentage point change in gross margin

     (1.4 pts)    
        

Production costs increased compared to the prior corresponding period, primarily due to higher input costs and unfavorable plant performance driven by the startup of our new Carole Park sheet machine.

In Australian dollars, EBIT for the quarter increased by 7%, compared to the prior corresponding period, reflecting increased net sales volumes and average net sales price, partially offset by higher input costs and sheet machine startup costs at our Carole Park facility.

 

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Additionally, EBIT was unfavorably impacted by higher segment SG&A, primarily driven by compensation expenses and New Zealand weathertighness claims. As a percentage of segment sales, SG&A expenses increased by 0.4 percentage points.

In Australian dollars, EBIT excluding New Zealand weathertightness claims for the quarter increased by 15%, compared to the prior corresponding period, to A$25.4 million.

At 30 June 2015, we finalized the sale of the Australia Pipes business, with a gain on sale of US$2.1 million recorded in other income ( expense ) in the Condensed Consolidated Statement of Operations and Comprehensive Income for fiscal year 2016. Due to the immaterial contribution of the pipes business to the segment results, the results of operations from the pipes business have not been presented as discontinued operations in the Condensed Consolidated Financial Statements.

Research and Development Segment

 

We record R&D expenses depending on whether they are core R&D projects that are designed to benefit all business units, which are recorded in our R&D segment; or commercialization projects for the benefit of a particular business unit which are recorded in the individual business unit’s segment results. The table below details the expenses of our R&D segment:

 

US$ Millions    Three Months Ended 30 June  
    

FY16

 

    

FY15

 

    

Change %

 

 

Segment R&D expenses

   $         (5.5)       $         (6.3)         13   

Segment R&D SG&A expenses

     (0.5)         (0.5)         -   

Total R&D EBIT

   $         (6.0)       $ (6.8)         12   

The change in segment R&D expenses compared to the prior corresponding period is a result of the number of core R&D projects being worked on by the R&D team. The expense will fluctuate period to period depending on the nature and number of core R&D projects being worked on and the average AUD/USD exchange rates during the period.

Other R&D expenses associated with commercialization projects in business units are recorded in the results of the respective business unit segment. In total, these costs were US$1.6 million for the quarter compared to US$2.1 million for the prior corresponding period.

 

 

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General Corporate Segment

 

Results for the General Corporate segment for the quarter ended 30 June were as follows:

 

US$ Millions  

Three Months Ended 30 June

 

 
   

FY16

 

   

FY15

 

   

Change %

 

 

General Corporate SG&A expenses

  $         (13.5)      $         (10.7)        (26

Asbestos:

         

Asbestos Adjustments

    (4.5     (21.5     79   

AICF SG&A Expenses 1

    (0.5     (0.6     17   

General Corporate EBIT

  $ (18.5   $ (32.8     44   

1 Relates to non-claims related operating costs incurred by AICF, which we consolidate into our financial results due to our pecuniary and contractual interests in AICF. Readers are referred to Note 7 of our 30 June 2015 Condensed Consolidated Financial Statements for further information on the Asbestos Adjustments

For the quarter, General Corporate SG&A expenses increased by US$2.8 million, compared to the prior corresponding period. The increase in General Corporate SG&A expenses is driven by higher stock compensation expenses of US$1.7 million due to a 14% appreciation in our USD stock price in the quarter, an increase in recognized foreign exchange losses of US$0.6 million and higher discretionary expenses of US$0.5 million.

Asbestos adjustments for both periods reflect the non-cash foreign exchange translation impact on asbestos related balance sheet items, driven by the change in the AUD/USD spot exchange rate from the beginning balance sheet date to the ending balance sheet date, for each respective period. The AUD/USD spot exchange rates are shown in the table below:

The AUD/USD spot exchange rates are shown in the table below:

 

Q1 FY16     Q1 FY15  

31 March 2015

    0.7636        31 March 2014     0.9220   

30 June 2015

    0.7675        30 June 2014     0.9422   

Change ($)

    0.0039        Change ($)     0.0202   

Change (%)

    1%        Change (%)     2%   

Readers are referred to Note 7 of our Condensed Consolidated Financial Statements for further information on asbestos adjustments.

 

 

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EBIT

 

The table below summarizes the segment EBIT results as discussed above:

 

US$ Millions   Three Months Ended 30 June  
   

FY16

 

   

FY15

 

   

    Change %

 

 

USA and Europe Fiber Cement

  $         89.5      $         68.0        32   

Asia Pacific Fiber Cement 1

    19.7        20.7        (5

Research & Development

    (6.0)        (6.8)        12   

General Corporate 2

    (13.5     (10.7     (26

Adjusted EBIT

    89.7        71.2        26   
         

Asbestos:

         

Asbestos adjustments

    (4.5     (21.5     79   

AICF SG&A expenses

    (0.5)        (0.6)        17   

New Zealand weathertightness claims

    (0.2     1.3           

EBIT

    84.5        50.4        68   

1 Excludes New Zealand weathertightness claims

2 Excludes Asbestos-related expenses and adjustments

Net interest expense

 

 

US$ Millions   

Three Months Ended 30 June

 

 
    

        FY16        

 

    

        FY15        

 

    

Change %  

 

 

Gross interest expense

     (6.6)         (0.9)        

Capitalized interest

     1.1         -          

Interest income

     0.1         0.2         (50)   

Realised loss on interest rate swaps

     (0.6)         (0.2)        

Net AICF interest income (expense)

     0.1         (0.2)        

Net interest expense

     (5.9)         (1.1)            

Gross interest expense for the quarter increased US$5.7 million when compared to the prior corresponding period, primarily as a result of interest incurred on our senior notes which we issued in the fourth quarter of fiscal year 2015.

Other income (expense)

 

During the quarter, other income (expense) moved from a loss of US$3.7 million in the prior corresponding period to a gain of US$2.7 million. The US$6.4 million favorable change in other income (expense) compared to the prior corresponding period is due to a US$2.2 million favorable change in net foreign exchange forward contracts, a US$2.1 million favorable change in the unrealized gains and losses related to our interest rate swaps, and a one-time US$2.1 million gain on the sale of the Australian Pipes business in the first quarter of fiscal year 2016.

 

 

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Income Tax

 

 

    

Three Months Ended 30 June    

 

 
    

        FY16        

 

   

        FY15        

 

 

Income tax expense (US$ Millions)

     (21.3     (16.7

Effective tax rate (%)

     26.2        36.6   
        

Adjusted income tax expense 1 (US$ Millions)

     (22.9     (16.5

Adjusted effective tax rate 1 (%)

     26.5        24.8   

1 Adjusted income tax expense represents income tax excluding asbestos adjustments, New Zealand weathertightness and other tax adjustments

Total income tax expense for the quarter increased by US$4.6 million from the prior corresponding period. The change was primarily due to the increase in operating profit before income taxes, partially offset by a decrease in the effective tax rate. The decrease in the effective tax rate was primarily due to reduction in unfavorable asbestos adjustments of US$17.0 million from the prior corresponding period and by a US$2.4 million reversal of a valuation allowance previously recorded in respect of a portion of its European tax loss carry-forwards.

Total Adjusted income tax expense for the quarter increased by US$6.4 million from the prior corresponding period. The change was primarily due to the increase in Adjusted operating profit before income taxes, combined with an increase in the Adjusted effective tax rate. The increase in the Adjusted effective tax rate was primarily due to a higher proportion of taxable earnings in jurisdictions with higher tax rates, in particular the USA. The Adjusted effective tax rate increased by 2.8% when compared to the full fiscal year 2015 Adjusted effective tax rate of 23.7%.

Readers are referred to Note 11 of our 30 June 2015 Condensed Consolidated Financial Statements for further information related to income tax.

 

 

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Net Operating Profit

 

 

US$ Millions   

 

Three Months Ended 30 June

 
    

 

FY16

 

   

 

FY15

 

   

 

Change %

 

 

EBIT

     $ 84.5        $ 50.4        68   
          

Net interest expense

     (5.9     (1.1    

Other income (expense)

     2.7        (3.7    

Income tax expense

     (21.3     (16.7     (28

Net operating profit

     60.0        28.9           
          

Excluding:

          

Asbestos:

          

Asbestos adjustments

     4.5        21.5        (79

AICF SG&A expenses

     0.5        0.6        (17

AICF interest (income) expense, net

     (0.1     0.2       

New Zealand weathertightness claims

     0.2        (1.3    

Asbestos and other tax adjustments

     (1.6     0.2       

Adjusted net operating profit

   $             63.5      $             50.1        27   
          

Adjusted diluted earnings per share (US cents)

     14        11        27    

Adjusted net operating profit of US$63.5 million for the quarter increased US$13.4 million, or 27%, compared to the prior corresponding period, primarily due to the underlying performance of the operating business units as reflected in the US$18.5 million increase in Adjusted EBIT and the favorable movement in other income (expense) of US$6.4 million. The improved underlying performance of the business was partially offset by an increase in Adjusted income tax expense of US$6.4 million, and gross interest expense of US$5.7 million.

 

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Cash Flow

 

Operating Activities

Net operating cash flow increased US$12.6 million to US$55.1 million. The movement compared to the prior corresponding period was primarily driven by the increase in earnings, as net income adjusted for non-cash items was up US$10.0 million period over period, and a US$2.5 million more favorable change in working capital period over period. The improved working capital change period over period was driven by improved inventory and accounts payable turns in the current period, partially offset by an unfavorable change in accounts receivables due to the timing of billing and collections.

Investing Activities

Cash flow used in investing activities decreased to US$16.9 million from US$48.6 million as we are nearing completion of our previously announced US and Australian capacity expansion projects while continuing to invest in maintenance capital expenditure programs. Included in investing activities was US$3.7 million in proceeds from the previously announced sale of the Blandon facility.

Financing Activities

Net cash used in financing activities of US$131.2 million in the prior corresponding period reduced to US$13.8 million. The US$117.4 million reduction in cash used in financing activities was primarily due to no dividends being paid in the current quarter, compared to the US$124.6 million payment of the one-time 125 year anniversary special dividend during the first quarter of fiscal year 2015.

Capacity Expansion

 

We are nearing completion of our previously announced US and Australian capacity expansion projects. We continually evaluate the demand in the US housing market and estimated commissioning dates of our capacity related projects. Currently, we have deferred the sheet machine commissioning at our Plant City and Cleburne facilities, subject to our continued monitoring of the US housing market recovery.

Subsequent to 30 June 2015 our Carole Park, Queensland facility commissioned the sheet machine line, and is on track to commission the rest of the project during the first half of fiscal 2016.

 

 

Project Description

   Project spend during the quarter

Plant City, Florida - 4 th sheet machine and ancillary facilities

   US$2.8 million

Cleburne, Texas - 3 rd sheet machine and ancillary facilities

   US$2.7 million

Carole Park, Queensland - Capacity expansion project

   US$2.0 million

 

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Liquidity and Capital Allocation

 

Our cash position increased from US$67.0 million at 31 March 2015 to US$92.3 million at 30 June 2015.

At 30 June 2015, we have US$590.0 million of combined bilateral credit facilities available to us with a combined average tenor of 2.2 years. At 30 June 2015, a total of US$60.0 million is drawn from our bilateral credit facilities, compared to US$75.0 million at 31 March 2015. Subsequent to 30 June 2015, the Company drew US$233.0 million from its combined bilateral credit facilities to fund the annual contribution to AICF and dividend payments.

At 30 June 2015, we have US$325.0 million in senior unsecured notes due 15 February 2023 with an interest of rate 5.875%. Interest is payable semi-annually in arrears on 15 August and 15 February each year.

Based on our existing cash balances, together with anticipated operating cash flows arising during the year and unutilized committed credit facilities, we anticipate that we will have sufficient funds to meet our planned working capital and other expected cash requirements for the next twelve months.

We have historically met our working capital needs and capital expenditure requirements from a combination of cash flow from operations and credit facilities. Seasonal fluctuations in working capital generally have not had a significant impact on our short or long term liquidity.

Capital Management and Dividends

 

The following table summarizes the dividends declared or paid during the fiscal years 2014, 2015 and 2016:

 

(Millions of US dollars)    US Cents/ 
Security
   US$ Total 
Amount
   Announcement
Date
   Record Date    Payment Date
FY 2015 special dividend    0.22    98.1    21 May 2015    11 June 2015    7 August 2015
FY 2015 second half dividend    0.27    120.4    21 May 2015    11 June 2015    7 August 2015
FY 2015 first half dividend    0.08    34.2    19 November 2014    23 December 2014    27 February 2015
FY 2014 special dividend    0.20    89.0    22 May 2014    12 June 2014    8 August 2014
FY 2014 second half dividend    0.32    142.3    22 May 2014    12 June 2014    8 August 2014
125 year anniversary special dividend    0.28    124.6    28 February 2014    21 March 2014    30 May 2014
FY 2014 first half dividend    0.08    35.5    14 November 2013     19 December 2013     28 March 2014
FY 2013 special dividend    0.24    106.1    23 May 2013    28 June 2013    26 July 2013
FY 2013 second half dividend    0.13    57.5    23 May 2013    28 June 2013    26 July 2013

Share Buyback

In May 2015, we announced a share buyback program to acquire up to 5% of its issued capital within the 12 month period to May 2016. The actual shares that we may repurchase will be subject to share price levels and consideration of the effect of the share buyback and alignment with our capital allocation objectives. No shares were repurchased or cancelled under this program for the three months ended 30 June 2015.

Subsequent to 30 June 2015, we acquired 1,653,247 shares of our common stock, with an aggregate cost of approximately A$30.0 million (US$22.5 million), at an average market price of A$18.1 (US$13.6).

 

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We will continue to review our capital structure and capital allocation objectives and expect the following prioritization to remain:

 

   

invest in R&D and capacity expansion to support organic growth;

 

   

provide ordinary dividend payments within the payout ratio of 50-70% of net operating profit excluding asbestos;

 

   

maintain flexibility for accretive and strategic inorganic growth and/or flexibility to manage through market cycles; and

 

   

consider other shareholder returns when appropriate.

Other Asbestos Information

 

Claims Data

 

     Three Months Ended 30 June  
     FY16      FY15      Change %  
Claims received      139         156          11   
Actuarial estimate for the period      164         153          (7
Difference in claims received to actuarial estimate      25         (3)            
            
Average claim settlement 1 (A$)      233,000         223,000          (4
Actuarial estimate for the period 2      302,000         289,000          (4
Difference in claims paid to actuarial estimate      69,000         66,000          (5

1 Average claim settlement is derived as the total amount paid divided by the number of non-nil claim settlements

2 This actuarial estimate is a function of the assumed experience by disease type and and the relative mix of settlements assumed by disease type. Any variances in the assumed mix of settlements by disease type will have an impact on the average claim settlement experience

For the quarter, we noted the following related to asbestos-related claims:

 

   

Claims received during the quarter were 15% below actuarial estimates and 11% lower than the prior corresponding period

 

   

Mesothelioma claims reported in the current quarter are 2% above actuarial estimates and are 5% below the prior corresponding period;

 

   

The average claim settlement is 23% below actuarial estimates and 4% higher than the prior corresponding period;

 

   

Average claim settlement sizes are generally lower across all disease types compared to actuarial expectations for fiscal year 2016; and

 

   

The decrease in average claim settlement for the quarter versus actuarial estimates is largely attributable to a lower number of large mesothelioma claims being settled compared to the prior corresponding period

 

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AICF Funding

On 1 July 2015, we made a payment of A$81.1 million (US$62.8 million) to AICF, representing 35% of our free cash flow for fiscal year 2015. Free cash flow, as defined in the AFFA, was equivalent to our fiscal year 2015 operating cash flows of US$179.5 million.

From the time AICF was established in February 2007 through 1 July 2015, we have contributed approximately A$799.2 million to the fund.

Readers are referred to Note 7 our 30 June 2015 Condensed Consolidated Financial Statements for further information on Asbestos.

 

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Non-financial Terms

 

 

AFFA – Amended and Restated Final Funding Agreement.

AICF Asbestos Injuries Compensation Fund Ltd.

NBSK – Northern Bleached Softwood Kraft; Our benchmark grade of pulp.

Legacy New Zealand weathertightness claims (“New Zealand weathertightness claims”) – Expenses arising from defending and resolving claims in New Zealand that allege poor building design, inadequate certification of plans, inadequate construction review and compliance certification and deficient work by sub-contractors.

 

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Financial Measures – US GAAP equivalents

 

 

This document contains financial statement line item descriptions that are considered to be non-US GAAP, but are consistent with those used by Australian companies. Because we prepare our Condensed Consolidated Financial Statements under US GAAP, the following table cross-references each non-US GAAP line item description, as used in Management’s Analysis of Results and Media Release, to the equivalent US GAAP financial statement line item description used in our Condensed Consolidated Financial Statements:

 

Management’s Analysis of Results and

Media Release

   Consolidated Statements of Operations and Other Comprehensive Income (Loss) (US GAAP)
   

Net sales

  

Net sales

Cost of goods sold

  

Cost of goods sold

     Gross profit

  

     Gross profit

   

Selling, general and administrative expenses

  

Selling, general and administrative expenses

Research and development expenses

  

Research and development expenses

Asbestos adjustments

  

Asbestos adjustments

     EBIT*

  

     Operating income (loss)

   

Net interest income (expense)*

  

Sum of interest expense and interest income

Other income (expense)

  

Other income (expense)

     Operating profit (loss) before income taxes*

  

     Income (loss) before income taxes

   

Income tax (expense) benefit

  

Income tax (expense) benefit

   

     Net operating profit (loss)*

  

     Net income (loss)

 

*- Represents non-US GAAP descriptions used by Australian companies.

EBIT margin – EBIT margin is defined as EBIT as a percentage of net sales.

Sales Volume

mmsf – million square feet, where a square foot is defined as a standard square foot of 5/16” thickness.

msf – thousand square feet, where a square foot is defined as a standard square foot of 5/16” thickness.

Financial Ratios

Gearing ratio – Net debt (cash) divided by net debt (cash) plus shareholders’ equity.

Net interest expense cover – EBIT divided by net interest expense (excluding loan establishment fees).

Net interest paid cover – EBIT divided by cash paid during the period for interest, net of amounts capitalized.

Net debt payback – Net debt (cash) divided by cash flow from operations.

Net debt (cash) – short-term and long-term debt less cash and cash equivalents.

Return on capital employed – EBIT divided by gross capital employed.

 

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Adjusted EBIT and Adjusted EBIT margin – Adjusted EBIT and Adjusted EBIT margin are not measures of financial performance under US GAAP and should not be considered to be more meaningful than EBIT and EBIT margin. Management has included these financial measures to provide investors with an alternative method for assessing its operating results in a manner that is focused on the performance of its ongoing operations and provides useful information regarding its financial condition and results of operations. Management uses these non-US GAAP measures for the same purposes .

 

US$ Millions   Three Months Ended 30 June  
   

 

FY16

    FY15  
EBIT   $              84.5     $              50.4  

Asbestos:

       

    Asbestos adjustments

    4.5        21.5   

    AICF SG&A expenses

    0.5        0.6   

New Zealand weathertightness claims

    0.2        (1.3

Adjusted EBIT

    89.7        71.2   

Net sales

  $             428.3      $             416.8   

Adjusted EBIT margin

    20.9     17.1

Adjusted net operating profit – Adjusted net operating profit is not a measure of financial performance under US GAAP and should not be considered to be more meaningful than net operating profit. Management has included this financial measure to provide investors with an alternative method for assessing its operating results in a manner that is focused on the performance of its ongoing operations. Management uses this non-US GAAP measure for the same purposes.

 

US$ Millions   Three Months Ended 30 June  
   

 

FY16

    FY15  

Net operating profit

  $             60.0      $             28.9    

Asbestos:

       

    Asbestos adjustments

    4.5        21.5   

    AICF SG&A expenses

    0.5        0.6   

    AICF interest (income) expense, net

    (0.1     0.2   

New Zealand weathertightness claims

    0.2        (1.3

Asbestos and other tax adjustments

    (1.6     0.2   

Adjusted net operating profit

  $ 63.5      $ 50.1   

 

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Adjusted diluted earnings per share Adjusted diluted earnings per share is not a measure of financial performance under US GAAP and should not be considered to be more meaningful than diluted earnings per share. Management has included this financial measure to provide investors with an alternative method for assessing its operating results in a manner that is focused on the performance of its ongoing operations. Management uses this non-US GAAP measure for the same purposes.

 

    Three Months Ended 30 June  
    FY16     FY15  

Adjusted net operating profit (US$ millions)

  $             63.5      $             50.1   

Weighted average common shares outstanding - Diluted (millions)

    447.4        446.0   
Adjusted diluted earnings per share (US cents)     14        11   

Adjusted income tax expense and Adjusted effective tax rate Adjusted income tax expenses and Adjusted effective tax rate on earnings is not a measure of financial performance under US GAAP and should not be considered to be more meaningful than income tax expense and effective tax rate, respectively. Management has included this financial measure to provide investors with an alternative method for assessing its operating results in a manner that is focused on the performance of its ongoing operations. Management uses this non-US GAAP measure for the same purposes.

 

US$ Millions    Three Months Ended 30 June  
     FY16      FY15  

Operating profit before income taxes

     $             81.3          $            45.6    

Asbestos:

       

    Asbestos adjustments

     4.5          21.5    

    AICF SG&A expenses

     0.5          0.6    

    AICF interest (income) expense, net

     (0.1)         0.2    

New Zealand weathertightness claims

     0.2          (1.3)   

Adjusted operating profit before income taxes

     $            86.4          $            66.6    
       

Income tax expense

     $          (21.3)         $          (16.7)   

Asbestos and other tax adjustments

     (1.6)         0.2    

Adjusted income tax expense

     $          (22.9)         $          (16.5)   

Effective tax rate

     26.2%         36.6%    
Adjusted effective tax rate        26.5%              24.8%  

 

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Adjusted EBITDA – is not a measure of financial performance under US GAAP and should not be considered an alternative to, or more meaningful than, income from operations, net income or cash flows as defined by US GAAP or as a measure of profitability or liquidity. Not all companies calculate Adjusted EBITDA in the same manner as James Hardie has and, accordingly, Adjusted EBITDA may not be comparable with other companies. Management has included information concerning Adjusted EBITDA because it believes that this data is commonly used by investors to evaluate the ability of a company’s earnings from its core business operations to satisfy its debt, capital expenditure and working capital requirements.

 

US$ Millions    Three Months Ended 30 June  
     FY16      FY15  
EBIT    $              84.5       $             50.4   
Depreciation and amortization      18.2         16.6   
Adjusted EBITDA    $ 102.7       $ 67.0   

Adjusted selling, general and administrative expenses – Adjusted selling, general and administrative expenses is not a measure of financial performance under US GAAP and should not be considered to be more meaningful than selling, general and administrative expenses. Management has included these financial measures to provide investors with an alternative method for assessing its operating results in a manner that is focused on the performance of its ongoing operations and provides useful information regarding its financial condition and results of operations. Management uses these non-US GAAP measures for the same purposes.

 

US$ Millions        Three Months Ended 30 June  
         FY16      FY15  

Selling, general and administrative expenses

     $ 61.5       $ 59.9   
Excluding:            
    New Zealand weathertightness claims        (0.2)         1.3   
    AICF SG&A expenses        (0.5)         (0.6)   
Adjusted selling, general and administrative expenses      $ 60.8       $ 60.6   
Net sales      $             428.3       $             416.8   
Selling, general and administrative expenses as a percentage of net sales        14.4%         14.4%   
Adjusted selling, general and administrative expenses as a percentage of net sales        14.2%         14.5%   

 

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As set forth in Note 7 of the Condensed Consolidated Financial Statements, the net AFFA liability, while recurring, is based on periodic actuarial determinations, claims experience and currency fluctuations. The company’s management measures its financial position, operating performance and year-over-year changes in operating results with and without the effect of the net AFFA liability. Accordingly, management believes that the following non-GAAP information is useful to it and investors in evaluating the company’s financial position and ongoing operating financial performance. The following non-GAAP table should be read in conjunction with the Condensed Consolidated Financial Statements and related notes contained therein.

James Hardie Industries plc

Supplementary Financial Information

30 June 2015

(Unaudited)

 

(US$ Millions)    Total Fibre
Cement –
Excluding
Asbestos
Compensation
    Asbestos
Compensation
    As
Reported
(US GAAP)
 
     
Restricted cash and cash equivalents – Asbestos    $              -      $             10.0      $             10.0   
Restricted short-term investments – Asbestos      -        -        -   
Insurance receivable – Asbestos¹      -        176.5        176.5   
Workers compensation asset – Asbestos¹      -        50.4        50.4   
Deferred income taxes – Asbestos¹      -        403.6        403.6   
     
Asbestos liability¹    $             -      $             1,400.5      $         1,400.5   
Workers compensation liability – Asbestos¹      -        50.4        50.4   
Income taxes payable      8.1        (23.2     15.1   
     
Asbestos adjustments    $             -      $             (4.5)      $             (4.5)   
Selling, general and administrative expenses      (61.0     (0.5     (61.5
Net interest (expense) income      (6.0     0.1        (5.9
Income tax (expense) benefit      (21.5     0.2        (21.3

¹ The amounts shown on these lines are a summation of both the current and non-current portion of the respective asset or liability as presented on our Condensed Consolidated Balance Sheets.

 

LOGO


LOGO

 

This Management’s Analysis of Results contains forward-looking statements. James Hardie Industries plc (the “company”) may from time to time make forward-looking statements in its periodic reports filed with or furnished to the Securities and Exchange Commission, on Forms 20-F and 6-K, in its annual reports to shareholders, in offering circulars, invitation memoranda and prospectuses, in media releases and other written materials and in oral statements made by the company’s officers, directors or employees to analysts, institutional investors, existing and potential lenders, representatives of the media and others. Statements that are not historical facts are forward-looking statements and such forward-looking statements are statements made pursuant to the Safe Harbor Provisions of the Private Securities Litigation Reform Act of 1995.

Examples of forward-looking statements include:

 

¡

statements about the company’s future performance;

¡

projections of the company’s results of operations or financial condition;

¡

statements regarding the company’s plans, objectives or goals, including those relating to strategies, initiatives, competition, acquisitions, dispositions and/or its products;

¡

expectations concerning the costs associated with the suspension or closure of operations at any of the company’s plants and future plans with respect to any such plants;

¡

expectations concerning the costs associated with the significant capital expenditure projects at any of the company’s plants and future plans with respect to any such projects;

¡

expectations regarding the extension or renewal of the company’s credit facilities including changes to terms, covenants or ratios;

¡

expectations concerning dividend payments and share buy-backs;

¡

statements concerning the company’s corporate and tax domiciles and structures and potential changes to them, including potential tax charges;

¡

statements regarding tax liabilities and related audits, reviews and proceedings;

¡

expectations about the timing and amount of contributions to Asbestos Injuries Compensation Fund (AICF), a special purpose fund for the compensation of proven Australian asbestos-related personal injury and death claims;

¡

expectations concerning indemnification obligations;

¡

expectations concerning the adequacy of the company’s warranty provisions and estimates for future warranty-related costs;

¡

statements regarding the company’s ability to manage legal and regulatory matters (including but not limited to product liability, environmental, intellectual property and competition law matters) and to resolve any such pending legal and regulatory matters within current estimates and in anticipation of certain third-party recoveries; and

¡

statements about economic conditions, such as changes in the US economic or housing recovery or changes in the market conditions in the Asia Pacific region, the levels of new home construction and home renovations, unemployment levels, changes in consumer income, changes or stability in housing values, the availability of mortgages and other financing, mortgage and other interest rates, housing affordability and supply, the levels of foreclosures and home resales, currency exchange rates, and builder and consumer confidence.

Words such as “believe,” “anticipate,” “plan,” “expect,” “intend,” “target,” “estimate,” “project,” “predict,” “forecast,” “guideline,” “aim,” “will,” “should,” “likely,” “continue,” “may,” “objective,” “outlook” and similar expressions are intended to identify forward-looking statements but are not the exclusive means of identifying such statements. Readers are cautioned not to place undue reliance on these forward-looking statements and all such forward-looking statements are qualified in their entirety by reference to the following cautionary statements.

Forward-looking statements are based on the company’s current expectations, estimates and assumptions and because forward-looking statements address future results, events and conditions, they, by their very nature, involve inherent risks and uncertainties, many of which are unforeseeable and beyond the company’s control. Such known and unknown risks, uncertainties and other factors may cause actual results, performance or other achievements to differ materially from the anticipated results, performance or achievements expressed, projected or implied by these forward-looking statements. These factors, some of which are discussed under “Risk Factors” in Section 3 of the Form 20-F filed with the Securities and Exchange Commission on 21 May 2015, include, but are not limited to: all matters relating to or arising out of the prior manufacture of products that contained asbestos by current and former company subsidiaries; required contributions to AICF, any shortfall in AICF and the effect of currency exchange rate movements on the amount recorded in the company’s financial statements as an asbestos liability; governmental loan facility to AICF; compliance with and changes in tax laws and treatments; competition and product pricing in the markets in which the company operates; the consequences of product failures or defects; exposure to environmental, asbestos, putative consumer class action or other legal proceedings; general economic and market conditions; the supply and cost of raw materials; possible increases in competition and the potential that competitors could copy the company’s products; reliance on a small number of customers; a customer’s inability to pay; compliance with and changes in environmental and health and safety laws; risks of conducting business internationally; compliance with and changes in laws and regulations; the effect of the transfer of the company’s corporate domicile from the Netherlands to Ireland, including changes in corporate governance and any potential tax benefits related thereto; currency exchange risks; dependence on customer preference and the concentration of the company’s customer base on large format retail customers, distributors and dealers; dependence on residential and commercial construction markets; the effect of adverse changes in climate or weather patterns; possible inability to renew credit facilities on terms favorable to the company, or at all; acquisition or sale of businesses and business segments; changes in the company’s key management personnel; inherent limitations on internal controls; use of accounting estimates; and all other risks identified in the company’s reports filed with Australian, Irish and US securities regulatory agencies and exchanges (as appropriate). The company cautions you that the foregoing list of factors is not exhaustive and that other risks and uncertainties may cause actual results to differ materially from those referenced in the company’s forward-looking statements. Forward-looking statements speak only as of the date they are made and are statements of the company’s current expectations concerning future results, events and conditions. The company assumes no obligation to update any forward-looking statements or information except as required by law.

 

LOGO

Q1 FY16 MANAGEMENT PRESENTATION
14 August 2015
Exhibit 99.4


PAGE
DISCLAIMER
This
Management
Presentation
contains
forward-looking
statements.
James
Hardie
Industries
plc
(the
“company”)
may
from
time
to
time
make
forward-looking
statements
in
its
periodic
reports
filed
with
or
furnished
to
the
Securities
and
Exchange
Commission,
on
Forms
20-F
and
6-K,
in
its
annual
reports
to
shareholders,
in
offering
circulars,
invitation
memoranda
and
prospectuses,
in
media
releases
and
other
written
materials
and
in
oral
statements
made
by
the
company’s
officers,
directors
or
employees
to
analysts,
institutional
investors,
existing
and
potential
lenders,
representatives
of
the
media
and
others.
Statements
that
are
not
historical
facts
are
forward-looking
statements
and
such
forward-looking
statements
are
statements
made
pursuant
to
the
Safe
Harbor
Provisions
of
the
Private
Securities
Litigation
Reform
Act
of
1995.
Examples of forward-looking statements include:
statements about the company’s future performance;
projections of the company’s results of operations or financial condition;
statements
regarding
the
company’s
plans,
objectives
or
goals,
including
those
relating
to
strategies,
initiatives,
competition,
acquisitions,
dispositions
and/or
its
products;
expectations concerning the costs associated with the suspension or closure of operations at any of the company’s plants and future plans with respect to any such plants;
expectations
concerning
the
costs
associated
with
the
significant
capital
expenditure
projects
at
any
of
the
company’s
plants
and
future
plans
with
respect
to
any
such
projects;
expectations regarding the extension or renewal of the company’s credit facilities including changes to terms, covenants or ratios;
expectations concerning dividend payments and share buy-backs;
statements concerning the company’s corporate and tax domiciles and structures and potential changes to them, including potential tax charges;
statements regarding tax liabilities and related audits, reviews and proceedings;
expectations about the timing and amount of contributions to Asbestos Injuries Compensation Fund (AICF), a special purpose fund for the compensation of proven Australian
asbestos-related personal injury and death claims;
expectations concerning indemnification obligations;
expectations concerning the adequacy of the company’s warranty provisions and estimates for future warranty-related costs;
statements regarding the company’s ability to manage legal and regulatory matters (including but not limited to product liability, environmental, intellectual property and competition
law matters) and to resolve any such pending legal and regulatory matters within current estimates and in anticipation of certain third-party recoveries; and
statements
about
economic
conditions,
such
as
changes
in
the
US
economic
or
housing
recovery
or
changes
in
the
market
conditions
in
the
Asia
Pacific
region,
the
levels
of
new
home
construction
and
home
renovations,
unemployment
levels,
changes
in
consumer
income,
changes
or
stability
in
housing
values,
the
availability
of
mortgages
and
other
financing, mortgage and other interest rates, housing affordability and supply, the levels of foreclosures and home resales, currency exchange rates, and builder and consumer
confidence.
2


PAGE
DISCLAIMER (continued)
Words
such
as
“believe,”
“anticipate,”
“plan,”
“expect,”
“intend,”
“target,”
“estimate,”
“project,”
“predict,”
“forecast,”
“guideline,”
“aim,”
“will,”
“should,”
“likely,”
“continue,”
“may,”
“objective,”
“outlook”
and
similar
expressions
are
intended
to
identify
forward-looking
statements
but
are
not
the
exclusive
means
of
identifying
such
statements.
Readers
are
cautioned
not
to
place
undue
reliance
on
these
forward-looking
statements
and
all
such
forward-looking
statements
are
qualified
in
their
entirety
by
reference
to
the
following
cautionary
statements.
Forward-looking
statements
are
based
on
the
company’s
current
expectations,
estimates
and
assumptions
and
because
forward-looking
statements
address
future
results,
events
and
conditions,
they,
by
their
very
nature,
involve
inherent
risks
and
uncertainties,
many
of
which
are
unforeseeable
and
beyond
the
company’s
control.
Such
known
and
unknown
risks,
uncertainties
and
other
factors
may
cause
actual
results,
performance
or
other
achievements
to
differ
materially
from
the
anticipated
results,
performance
or
achievements
expressed,
projected
or
implied
by
these
forward-looking
statements.
These
factors,
some
of
which
are
discussed
under
“Risk
Factors”
in
Section
3
of
the
Form
20-F
filed
with
the
Securities
and
Exchange
Commission
on
21
May
2015,
include,
but
are
not
limited
to:
all
matters
relating
to
or
arising
out
of
the
prior
manufacture
of
products
that
contained
asbestos
by
current
and
former
company
subsidiaries;
required
contributions
to
AICF,
any
shortfall
in
AICF
and
the
effect
of
currency
exchange
rate
movements
on
the
amount
recorded
in
the
company’s
financial
statements
as
an
asbestos
liability;
governmental
loan
facility
to
AICF;
compliance
with
and
changes
in
tax
laws
and
treatments;
competition
and
product
pricing
in
the
markets
in
which
the
company
operates;
the
consequences
of
product
failures
or
defects;
exposure
to
environmental,
asbestos,
putative
consumer
class
action
or
other
legal
proceedings;
general
economic
and
market
conditions;
the
supply
and
cost
of
raw
materials;
possible
increases
in
competition
and
the
potential
that
competitors
could
copy
the
company’s
products;
reliance
on
a
small
number
of
customers;
a
customer’s
inability
to
pay;
compliance
with
and
changes
in
environmental
and
health
and
safety
laws;
risks
of
conducting
business
internationally;
compliance
with
and
changes
in
laws
and
regulations;
the
effect
of
the
transfer
of
the
company’s
corporate
domicile
from
the
Netherlands
to
Ireland,
including
changes
in
corporate
governance
and
any
potential
tax
benefits
related
thereto;
currency
exchange
risks;
dependence
on
customer
preference
and
the
concentration
of
the
company’s
customer
base
on
large
format
retail
customers,
distributors
and
dealers;
dependence
on
residential
and
commercial
construction
markets;
the
effect
of
adverse
changes
in
climate
or
weather
patterns;
possible
inability
to
renew
credit
facilities
on
terms
favorable
to
the
company,
or
at
all;
acquisition
or
sale
of
businesses
and
business
segments;
changes
in
the
company’s
key
management
personnel;
inherent
limitations
on
internal
controls;
use
of
accounting
estimates;
and
all
other
risks
identified
in
the
company’s
reports
filed
with
Australian,
Irish
and
US
securities
regulatory
agencies
and
exchanges
(as
appropriate).
The
company
cautions
you
that
the
foregoing
list
of
factors
is
not
exhaustive
and
that
other
risks
and
uncertainties
may
cause
actual
results
to
differ
materially
from
those
referenced
in
the
company’s
forward-looking
statements.
Forward-looking
statements
speak
only
as
of
the
date
they
are
made
and
are
statements
of
the
company’s
current
expectations
concerning
future
results,
events
and
conditions.
The
company
assumes
no
obligation
to
update
any
forward-looking
statements
or
information
except
as
required
by
law.
3


PAGE
AGENDA
Overview
and
Operating
Review
Louis
Gries,
CEO
Financial
Review
Matt
Marsh,
CFO
Questions and Answers
In
this
Management
Presentation,
James
Hardie
may
present
financial
measures,
sales
volume
terms,
financial
ratios,
and
Non-US
GAAP
financial
measures
included
in
the
Definitions
and
other
terms
section
of
this
document.
The
company
presents
financial
measures
that
it
believes
are
customarily
used
by
its
Australian
investors.
Specifically,
these
financial
measures,
which
are
equivalent
to
or
derived
from
certain
US
GAAP
measures
as
explained
in
the
definitions,
include
“EBIT”,
“EBIT
margin”,
“Operating
profit
before
income
taxes”
and
“Net
operating
profit”.
The
company
may
also
present
other
terms
for
measuring
its
sales
volume
(“million
square
feet”
or
“mmsf”
and
“thousand
square
feet”
or
“msf”);
financial
ratios
(“Gearing
ratio”,
“Net
interest
expense
cover”,
“Net
interest
paid
cover”,
“Net
debt
payback”,
“Net
debt
(cash)”);
and
Non-US
GAAP
financial
measures
(“Adjusted
EBIT”,
“Adjusted
EBIT
margin”,
“Adjusted
net
operating
profit”,
“Adjusted
diluted
earnings
per
share”,
“Adjusted
operating
profit
before
income
taxes”,
“Adjusted
effective
tax
rate
on
earnings”,
“Adjusted
EBITDA”,
and
“Adjusted
selling,
general
and
administrative
expenses”.
Unless
otherwise
stated,
results
and
comparisons
are
of
the
first
quarter
of
the
current
fiscal
year
versus
the
first
quarter
of
the
prior
fiscal
year.
4


OVERVIEW AND OPERATING REVIEW
Louis Gries, CEO


PAGE
Group
net
sales
increased
3%
for
the
quarter
compared
to
pcp
1
Group
adjusted
net
operating
profit
increased
27%
to
US$63.5
million
for
the
quarter,
compared
to
pcp
1
Higher
volumes
and
average
net
sales
price
across
our
USA
and
Europe
and
Asia
Pacific
Fiber
Cement
segments
Results
are
largely
driven
by
lower
production
costs
due
to
the
continued
focus
on
operating
performance
and
lower
input
costs
of
our
USA
and
European
Fiber
Cement
segment
Our
current
quarter
USA
and
Europe
Fiber
Cement
segment
EBIT
margin
is
26.6%
compared
to
21.2%
in
the
pcp,
above
our
target
range
of
20%
to
25%
Subsequent
to
period
end,
approximately
1.7
million
shares
were
repurchased,
at
an
aggregate
cost
of
US$22.5
million,
under
the
previously
announced
share
buyback
program
We
started
up
our
sheet
machine
as
part
of
the
previously
announced
Carole
Park
capacity
expansion
project
in
the
quarter,
and
that
project
remains
on
track
KEY THEMES
6
1  
Prior corresponding period


PAGE
GROUP OVERVIEW
7
Q1'16
Q1'15
Change
Adjusted EBIT (US$ millions)
89.7
71.2
26%
Adjusted EBIT Margin %
20.9%
17.1%
3.8 pts
Adjusted Net Operating Profit (US$ millions)
63.5
50.1
27%
Net operating cash flow (US$ million)
55.1
42.5
30%
Adjusted Diluted EPS (US cents)
14
11
27%
Three Months Ended 30 June


PAGE
USA
AND
EUROPE
FIBER
CEMENT
1
st
QUARTER
SUMMARY
8
Higher
volume
driven
by
modest
market
growth
Higher
average
net
sales
price
reflects
our
annual
price
increase
effective
1
March
2015,
partially
offset
by
the
impact
of
foreign
exchange
and
mix
Favorable
production
costs
driven
primarily
by
continued
performance
improvements
across
our
network
of
plants,
as
well
as
lower
freight
costs
and
input
costs
for
pulp
and
utilities
1
st
Quarter Results
Net Sales
Up
5% to US$337.0 million
Sales Volume
Up
4% to 480.0 mmsf
Average Price
Up
1% to US$686 per msf
EBIT
Up
32% to US$89.5 million
EBIT Margin
Up
540 bps to 26.6%


PAGE
1
Excludes
asset
impairment
charges
of
US$14.3
million
in
4
th
quarter
FY12,
US$5.8
million
in
3
rd
quarter
FY13
and
US$11.1
million
in
4
th
quarter
FY13
USA AND EUROPE FIBER CEMENT
9
We
expect
EBIT
margins
for
fiscal
year
2016
to
be
towards
the
higher
end
of,
and
may
exceed
our
stated
target
range
of
20%
to
25%,
with
a
likely
return
back
to
our
target
range
in
fiscal
year
2017
0
5
10
15
20
25
30
0
10
20
30
40
50
60
70
80
90
100
FY11
FY12
FY13
FY14
FY15
FY16
Quarterly EBIT and EBIT Margin
1
EBIT
EBIT MARGIN


PAGE
Rolling 12 month average of seasonally adjusted estimate of housing starts by US Census Bureau
USA FIBER CEMENT
10


PAGE
USA AND EUROPE FIBER CEMENT
11
588
597
609
632
648
642
626
652
675
686
550
590
630
670
710
FY07
FY08
FY09
FY10
FY11
FY12
FY13
FY14
FY15
Q1 FY16
Average Net Sales Price


PAGE
12
Favorable conditions in addressable markets
Higher volume and sales in AUS, NZ, and Philippines
Higher average net sales price driven by favorable product mix and price increases
Higher production costs primarily driven by the impact of the depreciating Australian dollar on the US dollar price of
pulp and higher plant performance driven by the start up of our Carole Park sheet machine
EBIT results in US Dollars were impacted by a 17% unfavorable change in the weighted average period AUD/USD
exchange rate relative to the prior corresponding quarter
1
st
Quarter Results
Net Sales
Up
15% to A$117.4 million
Sales Volume
Up
10% to 119.1 mmsf
Average Price
Up
5% to A$975 per msf
US$ EBIT
1
Down
5% to US$19.7 million
A$ EBIT
1
Up
15%
to A$25.4 million
US$ EBIT Margin
1
Down
10 bps
to
21.6%
ASIA PACIFIC FIBER CEMENT 1st  QUARTER SUMMARY
1
Excludes New Zealand weathertightness
claims


FINANCIAL REVIEW
Matt Marsh, CFO


PAGE
GROUP RESULTS
Strong earnings growth reflects:
Higher sales volumes across all business units
Higher
average
sales
prices
across
the
USA
and
Europe
and
Asia
Pacific
Fiber
Cement
segments
Lower input costs for the USA and Europe Fiber Cement segment driven by pulp and utilities
Improved
plant
performance
across
our
USA
and
Europe
Fiber
Cement
segment
Marginally higher organizational spend , primarily driven by higher General Corporate expense,
consisting of higher stock compensation expenses and higher realized foreign exchange losses caused by
the strengthening of the US dollar during the quarter
Net
operating
cash
flow
of
US$55.1
million
for
the
quarter
compared
to
US$42.5
million
in
the
pcp
Capital
allocation
remains
on
strategy
On 1 July 2015, we made a payment of A$81.1 million (US$62.8 million) to AICF, representing 35% of our
free cash flow for fiscal year 2015
Subsequent to period end, approximately 1.7 million shares were repurchased, at an aggregate cost of
US$22.5 million, under the previously announced share buyback program
14


PAGE
Net sales increased 3%
Higher sales volumes
Higher average net sales prices in local currencies
Gross profit margin increased 320 bps
Continued performance improvement across our US plants
Lower input costs in the USA and Europe Fiber Cement segment
Higher average net sales price
SG&A expenses increased
Higher stock compensation expenses due to a 14% appreciation in
our stock price
Higher discretionary expenses and realized losses on foreign
currency transactions caused by the strengthening of the US dollar
Partially offset by lower SG&A expenses in the business units
Non-operating expenses
Interest expense increased related to our debt position
Other income (expense) includes: gain on the sale of the Australian
pipes business and favorable unrealized foreign exchange gains and
interest rate swaps
Income tax expense increased primarily driven by the increase in
operating income
RESULTS FOR THE 1
st
QUARTER
15
US$ Millions 
Q1 '16
Q1 '15
% Change
Net sales 
428.3
416.8
3
Gross profit 
157.6
140.2
12
SG&A expenses 
(61.5)
(59.9)
(3)
Research & development expenses 
(7.1)
(8.4)
15
Asbestos adjustments 
(4.5)
(21.5)
79
EBIT 
84.5
50.4
68
Net interest expense
(5.9)
(1.1)
Other income (expense)
2.7
(3.7)
Income tax expense
(21.3)
(16.7)
(28)
Net operating profit
60.0
28.9
Three Months Ended 30 June


PAGE
1
Includes
AICF
SG&A
expenses
and
AICF
interest
income,
net
RESULTS
FOR
THE
1
st
QUARTER
(continued)
16
Asbestos adjustments
1% change in the AUD / USD exchange rate from beginning
to ending balance sheet date for the period compared to a
2% change in spot rates in the prior corresponding period
Adjusted net operating profit increased 27%
26% increase in Adjusted EBIT
A US$6.4 million increase in Adjusted income tax expense
Favorable movement in other income (expense) of US$6.4
million
Gross interest expense of US$5.7 million
US$ Millions 
Q1 '16
Q1 '15
% Change
Net operating profit
60.0
28.9
Asbestos: 
Asbestos adjustments 
4.5
21.5
(79)
Other asbestos
1
0.4
0.8
(50)
New Zealand weathertightness
claims
0.2
(1.3)
Asbestos and other tax adjustments
(1.6)
0.2
Adjusted net operating profit
63.5
50.1
27
Three Months Ended 30 June


PAGE
GROSS PROFIT -
GROUP
17
Gross
profit
margins
remain
strong
Price
improvements
continue
as
we
execute
on
pricing
strategies
and
reduce
pricing
inefficiencies
Input
costs
for
pulp
and
utilities
are
lower
and
plant
performance
remains
on
a
positive
trend
line
as
we
continue
to
focus
on
cost
management
and
operational
excellence
126.3
140.2
157.6
33.9
33.6
36.8
31.0
32.0
33.0
34.0
35.0
36.0
37.0
38.0
-
20.0
40.0
60.0
80.0
100.0
120.0
140.0
160.0
180.0
Q1 FY14
Q1 FY15
Q1 FY16


PAGE
US INPUT COSTS
The price of NBSK pulp reduced by ~5%
compared
to
pcp
1
,
while
cement
has
increased
~8%
over
pcp
1
The cost of
electricity for industrial users
decreased from prior period
The cost of gas continued to trend down quarter
over quarter
18
The information underlying the table above is sourced as follows:
Pulp –
Cost per ton –
from RISI
Gas –
Cost per thousand cubic feet for industrial users –
from US Energy Information Administration
Electric –
Cost per thousand kilowatt hour for industrial users –
from US Energy Information Administration
Cement –
Relative index from the Bureau of Labor Statistics
1  
Prior corresponding period
0
1
2
3
4
5
6
7
8
9
10
0
200
400
600
800
1,000
1,200
Q1'13
Q2'13
Q3'13
Q4'13
Q1'14
Q2'14
Q3'14
Q4'14
Q1'15
Q2'15
Q3'15
Q4'15
Q1'16
Quarterly US Input Costs
PULP
GAS
ELECTRIC
CEMENT


PAGE
1
Excludes New Zealand weathertightness
claims
USA and Europe Fiber Cement EBIT summary:
EBIT increased by 32% when compared to pcp
The increase for the quarter was driven by improved
plant performance, lower input costs, increased
volumes and lower segment SG&A expenses
Asia Pacific Fiber Cement EBIT summary:
Quarter
EBIT
1
decreased
5%
compared
to
pcp.
The
Asia Pacific Fiber Cement segment results in US
dollars were impacted by a 17% unfavorable change
in the weighted average period AUD/USD exchange
rate relative to the prior corresponding quarter.
EBIT
1
in
local
currency
for
the
quarter
increased
15%
compared to pcp
SEGMENT
EBIT
1
st
QUARTER
19
59.4
68.0
89.5
0
20
40
60
80
100
FY14
FY15
FY16
USA and Europe Fiber Cement
Q1 EBIT
21.1
20.7
19.7
21.4
22.1
25.4
0
5
10
15
20
25
30
FY14
FY15
FY16
Asia Pacific Fiber Cement
1
US$ Q1 EBIT
A$ Q1 EBIT


PAGE
1
Excludes
Asbestos
related
expenses
and
adjustments
and
ASIC
expenses
R&D summary:
Continued broadly in line with historic trend line on a
percentage of sales basis
Fluctuations reflect normal variation and timing in
number of R&D projects in process in any given period
General corporate costs:
Results for the quarter increased due to higher :
Stock compensation related to share price
appreciation
Discretionary expenses
Foreign exchange losses
SEGMENT
EBIT
1
st
QUARTER
20
(6.1)
(6.8)
(6.0)
(7)
(6)
(5)
FY14
FY15
FY16
Research and Development
Q1 EBIT
(6.9)
(10.7)
(13.5)
(16)
(14)
(12)
(10)
(8)
(6)
(4)
(2)
0
FY14
FY15
FY16
General Corporate Costs
1
Q1 EBIT


PAGE
CHANGES IN AUD vs. USD
Unfavorable impact from translation of Asia Pacific results
Favorable impact on corporate costs incurred in Australian dollars
Unfavorable impact from translation of asbestos liability balance
Earnings
Balance Sheet
N/A
N/A
21


PAGE
1
Includes Asbestos adjustments, AICF SG&A expenses and AICF interest expense, net
2
Excludes tax effects of Asbestos and other tax adjustments
26.5%
estimated
adjusted
effective
tax
rate
(ETR)
for
the
year
Adjusted
income
tax
expense
increased
due
to
the
increase
in
operating
profit
before
income
taxes,
primarily
in
the
US
The
difference
between
adjusted
income
tax
expense
and
income
tax
expense
increased
primarily
due
to
lower
asbestos
and
other
tax
adjustments
Income
taxes
are
paid
and
payable
in
Ireland,
the
US,
Canada,
New
Zealand
and
the
Philippines
Income
taxes
are
not
currently
paid
or
payable
in
Europe
(excluding
Ireland)
or
Australia
due
to
tax
losses.
Australian
tax
losses
primarily
result
from
deductions
relating
to
contributions
to
AICF
INCOME TAX
22
Q1’16
Q1’15
Operating profit before taxes
81.3
45.6
Asbestos:
Asbestos adjustments
1
4.9
22.3
NZ weathertightness claims
0.2
(1.3)
Adjusted net operating profit
before taxes
86.4
66.6
Adjusted income tax expense
2
(22.9)
(16.5)
Adjusted effective tax rate
26.5%
24.8%
Income tax expense
(21.3)
(16.7)
Income taxes paid
4.3
2.5
Income taxes payable
15.1
6.5
Three Months Ended 30 June


PAGE
1
CASHFLOW
23
1
Includes Asbestos Adjustments and changes in asbestos-related assets and liabilities
2
Includes capitalized interest and proceeds from sale of property, plant and equipment
(US$ Millions)
Q1'16
Q1'15
Change (%)
Net Income
60.0
28.9
Asbestos
related
1
4.6
20.9
(78)
Depreciation & amortization
18.2
16.6
10
Working capital
1.4
(0.4)
Other non-cash items
(29.1)
(23.5)
(24)
Cash Flow from Operations
55.1
42.5
30
Capital
expenditures
2
(16.4)
(48.6)
66
Acquisition of assets
(0.5)
-
Free Cash Flow
38.2
(6.1)
Dividends paid
-
(124.6)
Net payment of long-term debt
(15.0)
-
Share related activities
1.2
(6.6)
Free Cash Flow after Financing Activities 
24.4
(137.3)
Net
income
increased
US$31.1
million
compared
to
prior
corresponding
period
Improved
working
capital
driven
by:
Improved
inventory
and
A/P
turns
Partially
offset
by
an
unfavorable
change
in
A/R
due
to
the
timing
of
billing
and
collections
Lower
capital
expenditures:
Reflecting
near
completion
of
our
previously
announced
US
and
Australian
capacity
projects
While
continuing
to
invest
in
maintenance
capital
expenditure
programs
Lower
financing
activities:
No
dividends
being
paid
in
the
current
period,
compared
to
the
US$124.6
million
payment
of
the
one-time
125
year
anniversary
special
dividend
during
the
first
quarter
of
fiscal
year
2015


PAGE
FINANCIAL MANAGEMENT SUPPORTING GROWTH
24
Strong margins and
operating cash flows
Strong governance and
transparency
Investment-grade financial
management
Investing in R&D and capacity
expansion to support organic
growth
Maintain ordinary dividends within
the defined payout ratio
Flexibility for:
Accretive and strategic
inorganic opportunities
Withstand market cycles
Consider further
shareholder returns when
appropriate
Financial management consistent with an investment grade credit.
Ability to withstand market cycles and other unanticipated events.
1
Strong
Financial
Management
Disciplined
Capital
Allocation
2
Liquidity
and
Funding
3
~$590 million of bank
facilities, 68% liquidity as of
Q’16
2.2 year weighted average
maturity of bank facilities
Completed the sale of US$325
million 8 year 5.875% senior
unsecured notes
Conservative leveraging of
balance sheet within 1-2
times adjusted EBITDA target


PAGE
LIQUIDITY PROFILE
25
Strong
balance
sheet
position:
US$92.3
million
of
cash
US$382.6
million
of
gross
debt
US$590
million
of
bank
debt
facilities
US$325
million
8
year
unsecured
notes
2,3
68%
liquidity
as
of
Q1’16
At
30
June
2015,
net
debt
of
US$290.3
million
compared
to
net
debt
of
US$330.5
million
at
31
March
2015
At
30
June
2015,
we
have
US$325.0
million
in
senior
unsecured
notes
due
15
February
2023
with
an
interest
of
rate
5.875%.
Interest
is
payable
semi-
annually
in
arrears
on
15
August
and
15
February
each
year.
Net
Debt
within
target
range
of
1-2
times
EBITDA
excluding
asbestos
We
remain
in
compliance
with
all
debt
covenants
1
Debt maturities as at Q1’16 were as follows: US$50 million in Q4’16, US$150 million in Q1’17, US$100 million in 
Q1’18, US$125 million Q3’18, US$40 million in Q4’19, US$125 million in Q1’20 and US$325 million in Q4’23
2
Callable from February 2018
3
Original issue discount (OID) US$2.4 million at 30 June 2015
$50
$150
$225
$40
$125
$325
FY'16
FY'17
FY'18
FY'19
FY'20
FY'23
Debt Maturity Profile
1
Liquidity Profile of Bilateral Facilities
Three months ended 30 June
Cash
US$92.3 million
Total Combined Bank Facilities
US$590.0 million
Drawn Bank Facilities
US$60.0 million
Undrawn Bank Facilities
US$530.0 million
Weighted Average Interest Rate of drawn Bank Facilities
1.4%
Fixed / Floating Interest Ratio
110% fixed
Weighted Average Term (Bank Facilities)
2.2 years
Weighted Average Term (Total Facilities)
4.1 years


PAGE
ASBESTOS CLAIMS DATA
26
1       Average claim settlement is derived as the total amount paid divided by the number of non-nil claim settlements
2       This actuarial estimate is a function of the assumed experience by disease type and the relative mix of settlements assumed by disease type. Any variances in the assumed mix of
settlements by disease type will have an impact on the average claim settlement experience
Q1 '16
Q1 '15
% Change
Claims received
139
156
11
Actuarial estimate for the period
164
153
(7)
Difference in claims received to actuarial
estimate
25
(3)
Average
claim
settlement
1
233,000
223,000
(4)
Actuarial
estimate
for
the
period
2
(A$)
302,000
289,000
(4)
Difference in claims paid to actuarial estimate
69,000
66,000
(5)
Three Months Ended  30 June
Claims Data
Claims
received
during
the
quarter
were
15%
below
actuarial
estimates
and
11%
lower
than
the
prior
corresponding
period
Mesothelioma
claims
reported
in
the
current
quarter
are
2%
above
actuarial
estimates
and
are
5%
below
the
prior
corresponding
period
Average
claim
settlement
sizes
are
generally
lower
across
all
disease
types
compared
to
actuarial
expectations
for
fiscal
year
2016
The
average
claim
settlement
is
23%
below
actuarial
estimates
and
4%
higher
than
the
prior
corresponding
period
(A$)


PAGE
Group
net
sales
increased
3%
for
the
quarter
when
compared
to
the
prior
corresponding
period
Group
adjusted
net
operating
profit
increased
27%
for
the
quarter
when
compared
to
the
prior
corresponding
period
Results
driven
by
higher
volumes,
average
net
sales
price
and
the
continued
focus
across
our
plants
on
operational
management
and
cost
management
across
the
Company
Strong
financial
management
continues
and
disciplined
capital
allocation
resulting
in:
Funding
organic
growth
initiatives
A$81.1
million
(US$62.8
million)
paid
to
AICF
on
1
July
2015,
representing
35%
of
our
free
cash
flow
for
fiscal
year
2015
Returning
capital
to
shareholders
through
dividends
and/or
share
buybacks
Net
Debt
within
target
range
of
1-2
times
EBITDA
excluding
asbestos
SUMMARY 
27


PAGE
Management notes the range of analysts’ forecasts for net operating profit excluding asbestos for the year
ending
31
March
2016
is
between
US$244
million
and
US$286
million
Management
expects
full
year
Adjusted
net
operating
profit
to
be
between
US$240
million
and
US$270
million
assuming, among other things, housing conditions in the United States continuing to improve in line with our
assumed forecasted new construction starts, input prices and production efficiencies remaining consistent and
an average exchange rate at or near current levels is applicable for the remainder of the year
Management cautions that although US housing activity has been improving, market conditions remain
somewhat uncertain and some input costs remain volatile
Management is unable to forecast the comparable US GAAP financial measure due to uncertainty regarding the
impact of actuarial estimates on asbestos-related assets and liabilities in future periods
FY2016 GUIDANCE
28


QUESTIONS


APPENDIX


PAGE
FINANCIAL SUMMARY
1
Asia
Pacific
Fiber
Cement
EBIT
excludes
New
Zealand
weathertightness
expense
of
US$0.2
million
in
Q1’FY16
and
benefit
of
US$1.3
million
in
Q1’FY15
2   
Excludes Asbestos related expenses and adjustments
31
US$ Millions
Q1 '16
Q1 '15
% Change
Net Sales
USA and Europe Fiber Cement
337.0
$                 
321.5
$                 
5
Asia Pacific Fiber Cement
91.3
95.3
(4)
Total Net Sales
428.3
$                 
416.8
$                 
3
EBIT -
US$ Millions
USA and Europe Fiber Cement
89.5
$                    
68.0
$                    
32
Asia Pacific Fiber Cement
1
19.7
20.7
(5)
Research & Development
(6.0)
(6.8)
12
General Corporate
2
(13.5)
(10.7)
(26)
Adjusted EBIT
89.7
$                    
71.2
$                    
26
Net interest expense excluding AICF interest income
(6.0)
(0.9)
Other income (expense)
2.7
(3.7)
Adjusted income tax expense
(22.9)
(16.5)
(39)
Adjusted net operating profit
63.5
$                    
50.1
$                    
27
Three Months Ended 30 June


PAGE
1
Excludes asbestos adjustments, AICF SG&A expenses, AICF interest income, New Zealand weathertightness claims, tax adjustments
2
Excludes asbestos adjustments, AICF SG&A expenses,  New Zealand weathertightness claims
KEY RATIOS
32
3 Months FY16
3 Months FY15
3 Months FY14
EPS (Diluted)
1
(US Cents)
14c
11c
12c
EBIT/ Sales (EBIT margin)
2
20.9%
17.1%
18.1%
Gearing Ratio
1
20.4%
(3.3)%
(16.5)%
Net Interest Expense Cover
2
15.0x
79.1x
84.4x
Net Interest Paid Cover
2
108.5x
89.0x
67.5x
Net Debt Payback
1.4yrs
-
-
Three Months Ended 30 June


PAGE
EBITDA –
1
st
QUARTER
33
1
Asia
Pacific
Fiber
Cement
EBIT
excludes
New
Zealand
weathertightness
expense
of
US$0.2
million
in
Q1’FY16
and
benefit
of
US$1.3
million
in
Q1’FY15.
2
EBITDA excluding Asbestos Adjustments, New Zealand weathertightness
3
Excludes Asbestos related expenses and adjustments
US$ Millions
Q1'16
Q1'15
% Change
Adjusted EBIT
USA and Europe Fiber Cement
$               89.5
$               68.0
32
Asia
Pacific
Fiber
Cement
1
19.7
20.7
(5)
Research & Development
(6.0)
(6.8)
12
General
Corporate
3
(13.5)
(10.7)
(26)
Depreciation and Amortization
USA and Europe Fiber Cement
16.0
14.4
11
Asia Pacific Fiber Cement
2.2
2.2
-
EBITDA
2
-
Asbestos adjustments
(4.5)
(21.5)
79
AICF SG&A expenses
(0.5)
(0.6)
17
New Zealand weathertightness claims
(0.2)
1.3
Total EBITDA
$            102.7
$               67.0
Three Months Ended 30 June


PAGE
NET INTEREST EXPENSE
34
US$ Millions
Q1 FY16
Q1 FY15
Gross interest expense
(6.6)
(0.9)
Capitalized interest
1.1
-
Interest income
0.1
0.2
Realized loss on interest rate swaps
(0.6)
(0.2)
Net interest expense excluding AICF interest
income
(6.0)
(0.9)
AICF net interest income (expense)
0.1
(0.2)
Net interest expense
(5.9)
(1.1)
Three Months Ended 30 June


PAGE
ASBESTOS FUND –
PROFORMA (unaudited)
35
A$ millions
AICF cash and investments - 31 March 2015
28.9
Insurance recoveries
3.9
Loan Drawdowns
17.7
Interest income, net
0.1
Claims paid
(36.8)
Operating costs
(1.0)
Other
0.3
AICF cash and investments - 30 June 2015
13.1


PAGE
DEFINITIONS AND OTHER TERMS
This
Management
Presentation
forms
part
of
a
package
of
information
about
the
company’s
results.
It
should
be
read
in
conjunction
with
the
other
parts
of
this
package,
including
the
Management’s
Analysis
of
Results,
Media
Release
and
Consolidated
Financial
Statements
Definitions
Non-financial Terms
AFFA
Amended and Restated Final Funding Agreement
AICF
Asbestos
Injuries
Compensation
Fund
Ltd
NBSK
Northern
Bleached
Soft
Kraft;
the
company's
benchmark
grade
of
pulp
Legacy
New
Zealand
weathertightness
claims
(“New
Zealand
weathertightness
claims”)
Expenses
arising
from
defending
and
resolving
claims
in
New
Zealand
that
allege
poor
building
design,
inadequate
certification
of
plans,
inadequate
construction
review
and
compliance
certification
and
deficient
work
by
sub-contractors
36


PAGE
DEFINITIONS AND OTHER TERMS
Financial
Measures
US
GAAP
equivalents
This
document
contains
financial
statement
line
item
descriptions
that
are
considered
to
be
non-US
GAAP,
but
are
consistent
with
those
used
by
Australian
companies.
Because
the
company
prepares
its
Consolidated
Financial
Statements
under
US
GAAP,
the
following
table
cross-references
each
non-US
GAAP
line
item
description,
as
used
in
Management’s
Analysis
of
Results
and
Media
Release,
to
the
equivalent
US
GAAP
financial
statement
line
item
description
used
in
the
company’s
Condensed
Consolidated
Financial
Statements:
37


PAGE
DEFINITIONS AND OTHER TERMS
EBIT
margin
EBIT
margin
is
defined
as
EBIT
as
a
percentage
of
net
sales
Sales
Volumes
mmsf
million
square
feet,
where
a
square
foot
is
defined
as
a
standard
square
foot
of
5/16”
thickness
msf
thousand
square
feet,
where
a
square
foot
is
defined
as
a
standard
square
foot
of
5/16”
thickness
Financial Ratios
Gearing
Ratio
Net
debt
(cash)
divided
by
net
debt
(cash)
plus
shareholders’
equity
Net
interest
expense
cover
EBIT
divided
by
net
interest
expense
(excluding
loan
establishment
fees)
Net
interest
paid
cover
EBIT
divided
by
cash
paid
during
the
period
for
interest,
net
of
amounts
capitalised
Net
debt
payback
Net
debt
(cash)
divided
by
cash
flow
from
operations
Net
debt
(cash)
Short-term
and
long-term
debt
less
cash
and
cash
equivalents
Return
on
capital
employed
EBIT
divided
by
gross
capital
employed
38


PAGE
Adjusted
EBIT
and
Adjusted
EBIT
margin
Adjusted
EBIT
and
Adjusted
EBIT
margin
are
not
measures
of
financial
performance
under
US
GAAP
and
should
not
be
considered
to
be
more
meaningful
than
EBIT
and
EBIT
margin.
Management
has
included
these
financial
measures
to
provide
investors
with
an
alternative
method
for
assessing
its
operating
results
in
a
manner
that
is
focused
on
the
performance
of
its
ongoing
operations
and
provides
useful
information
regarding
its
financial
condition
and
results
of
operations.
Management
uses
these
non-US
GAAP
measures
for
the
same
purposes .
NON-US GAAP FINANCIAL MEASURES
39
US$ Millions
Three Months Ended 30 June
Q1 '16
Q1 '15
EBIT
84.5
$              
50.4
$             
Asbestos:
Asbestos adjustments
4.5
21.5
AICF SG&A expenses
0.5
0.6
New Zealand weathertightness claims
0.2
(1.3)
Adjusted EBIT
89.7
71.2
Net sales
428.3
$            
416.8
$           
Adjusted EBIT margin
20.9%
17.1%


PAGE
Adjusted
net
operating
profit
Adjusted
net
operating
profit
is
not
a
measure
of
financial
performance
under
US
GAAP
and
should
not
be
considered
to
be
more
meaningful
than
net
operating
profit.
Management
has
included
this
financial
measure
to
provide
investors
with
an
alternative
method
for
assessing
its
operating
results
in
a
manner
that
is
focused
on
the
performance
of
its
ongoing
operations.
Management
uses
this
non-US
GAAP
measure
for
the
same
purposes.
NON-US GAAP FINANCIAL MEASURES
40
US$ Millions
Three Months Ended 30 June
Q1 '16
Q1 '15
Net operating profit
60.0
$            
28.9
$            
Asbestos:
Asbestos adjustments
4.5
21.5
AICF SG&A expenses
0.5
0.6
AICF interest (income) expense, net
(0.1)
0.2
New Zealand weathertightness claims
0.2
(1.3)
Asbestos and other tax adjustments
(1.6)
0.2
Adjusted net operating profit
63.5
$            
50.1
$            


PAGE
Adjusted
diluted
earnings
per
share
Adjusted
diluted
earnings
per
share
is
not
a
measure
of
financial
performance
under
US
GAAP
and
should
not
be
considered
to
be
more
meaningful
than
diluted
earnings
per
share.
Management
has
included
this
financial
measure
to
provide
investors
with
an
alternative
method
for
assessing
its
operating
results
in
a
manner
that
is
focused
on
the
performance
of
its
ongoing
operations.
Management
uses
this
non-US
GAAP
measure
for
the
same
purposes.
41
NON-US GAAP FINANCIAL MEASURES
Three Months Ended 30 June
Q1 '16
Q1 '15
Adjusted net operating profit (US$ millions)
63.5
$              
50.1
$              
Weighted average common shares outstanding -
   Diluted (millions)
447.4
446.0
Adjusted diluted earnings per share (US cents)
14
                  
11
                  


PAGE
Adjusted
income
tax
expense
and
Adjusted
effective
tax
rate
Adjusted
income
tax
expenses
and
Adjusted
effective
tax
rate
on
earnings
is
not
a
measure
of
financial
performance
under
US
GAAP
and
should
not
be
considered
to
be
more
meaningful
than
income
tax
expense
and
effective
tax
rate,
respectively.
Management
has
included
this
financial
measure
to
provide
investors
with
an
alternative
method
for
assessing
its
operating
results
in
a
manner
that
is
focused
on
the
performance
of
its
ongoing
operations.
Management
uses
this
non-US
GAAP
measure
for
the
same
purposes.
42
NON-US GAAP FINANCIAL MEASURES
US$ Millions
Q1 '16
Q1 '15
Operating profit before income taxes
81.3
$              
45.6
$              
Asbestos:
Asbestos adjustments
4.5
21.5
AICF SG&A expenses
0.5
0.6
AICF interest (income) expense, net
(0.1)
0.2
New Zealand weathertightness claims
0.2
(1.3)
Adjusted operating profit before income taxes
86.4
$              
66.6
$              
Income tax expense
(21.3)
$             
(16.7)
$             
Asbestos and other tax adjustments
(1.6)
0.2
Adjusted income tax expense
(22.9)
$             
(16.5)
$             
Effective tax rate  
26.2%
36.6%
Adjusted effective tax rate
26.5%
24.8%
Three Months Ended 30 June


PAGE
Adjusted
EBITDA
is
not
a
measure
of
financial
performance
under
US
GAAP
and
should
not
be
considered
an
alternative
to,
or
more
meaningful
than,
income
from
operations,
net
income
or
cash
flows
as
defined
by
US
GAAP
or
as
a
measure
of
profitability
or
liquidity.
Not
all
companies
calculate
Adjusted
EBITDA
in
the
same
manner
as
James
Hardie
has
and,
accordingly,
Adjusted
EBITDA
may
not
be
comparable
with
other
companies.
Management
has
included
information
concerning
Adjusted
EBITDA
because
it
believes
that
this
data
is
commonly
used
by
investors
to
evaluate
the
ability
of
a
company’s
earnings
from
its
core
business
operations
to
satisfy
its
debt,
capital
expenditure
and
working
capital
requirements
NON-US GAAP FINANCIAL MEASURES
43
US$ Millions
Q1 '16
Q1 '15
EBIT
84.5
$            
50.4
$             
Depreciation and amortization
18.2
16.6
Adjusted EBITDA
102.7
$          
67.0
$             
Three Months Ended 30 June


PAGE
Adjusted
selling,
general
and
administrative
expenses
Adjusted
selling,
general
and
administrative
expenses
is
not
a
measure
of
financial
performance
under
US
GAAP
and
should
not
be
considered
to
be
more
meaningful
than
selling,
general
and
administrative
expenses.
Management
has
included
these
financial
measures
to
provide
investors
with
an
alternative
method
for
assessing
its
operating
results
in
a
manner
that
is
focused
on
the
performance
of
its
ongoing
operations
and
provides
useful
information
regarding
its
financial
condition
and
results
of
operations.
Management
uses
these
non-US
GAAP
measures
for
the
same
purposes.
NON-US GAAP FINANCIAL MEASURES
44
US$ Millions
Q1 '16
Q1 '15
Selling, general and administrative expenses
61.5
$              
59.9
$             
Excluding:
New Zealand weathertightness claims
(0.2)
                 
1.3
                
AICF SG&A expenses
(0.5)
                 
(0.6)
               
Adjusted selling, general and administrative expenses 
60.8
$              
60.6
$             
Net sales
428.3
$            
416.8
$           
Selling, general and administrative expenses as a percentage
of net sales
14.4%
14.4%
Adjusted selling, general and administrative expenses 
as a percentage of net sales
14.2%
14.5%
Three Months Ended 30 June


Q1 FY16 MANAGEMENT PRESENTATION
14 August 2015

Exhibit 99.5

 

James Hardie Industries plc

Condensed Consolidated Financial Statements

as of and for the Period Ended 30 June 2015

 

F-1


James Hardie Industries plc

Index

 

 

     Page     

Item 1. Condensed Consolidated Financial Statements (Unaudited)

  

Condensed Consolidated Balance Sheets as of 30 June 2015 and 31 March 2015

     F-3     

Condensed Consolidated Statements of Operations and Comprehensive Income for the Three Months Ended 30 June 2015 and 2014

     F-4     

Condensed Consolidated Statements of Cash Flows for the Three Months Ended 30 June 2015 and 2014

     F-5     

Notes to Condensed Consolidated Financial Statements

     F-6     

 

F-2


James Hardie Industries plc

Condensed Consolidated Balance Sheets

(Unaudited)

 

 

     (Millions of US dollars)  
      30 June
2015
    31 March
2015
 

Assets

    

Current assets:

    

Cash and cash equivalents

     $ 92.3          $ 67.0     

Restricted cash and cash equivalents

     5.0          5.0     

Restricted cash and cash equivalents - Asbestos

     10.0          22.0     

Accounts and other receivables, net of allowance for doubtful accounts of US$0.9 million and US$0.8 million as of 30 June 2015 and 31 March 2015, respectively

     153.9          133.3     

Inventories

     207.6          218.0     

Prepaid expenses and other current assets

     20.2          24.3     

Insurance receivable - Asbestos

     16.8          16.7     

Workers’ compensation - Asbestos

     4.6          4.5     

Deferred income taxes

     14.6          17.3     

Deferred income taxes - Asbestos

     13.9          15.9     
  

 

 

   

 

 

 

Total current assets

     538.9          524.0     

Property, plant and equipment, net

     896.8          880.1     

Insurance receivable - Asbestos

     159.7          161.9     

Workers’ compensation - Asbestos

     45.8          45.5     

Deferred income taxes

     15.1          12.9     

Deferred income taxes - Asbestos

     389.7          389.3     

Other assets

     31.6          30.8     
  

 

 

   

 

 

 

Total assets

   $ 2,077.6        $ 2,044.5     
  

 

 

   

 

 

 

Liabilities and Shareholders’ Equity

    

Current liabilities:

    

Accounts payable and accrued liabilities

   $ 150.4        $ 149.6     

Short-term debt - Asbestos

     27.5          13.6     

Dividends payable

     215.8          -     

Accrued payroll and employee benefits

     37.3          60.6     

Accrued product warranties

     12.1          8.9     

Income taxes payable

     15.1          1.8     

Asbestos liability

     132.3          131.6     

Workers’ compensation - Asbestos

     4.6          4.5     

Other liabilities

     11.1          7.3     
  

 

 

   

 

 

 

Total current liabilities

     606.2          377.9     

Long-term debt

     382.6          397.5     

Deferred income taxes

     88.9          88.9     

Accrued product warranties

     23.0          26.3     

Asbestos liability

     1,268.2          1,290.0     

Workers’ compensation - Asbestos

     45.8          45.5     

Other liabilities

     19.2          21.0     
  

 

 

   

 

 

 

Total liabilities

     2,433.9          2,247.1     
  

 

 

   

 

 

 

Commitments and contingencies (Note 10)

    

Shareholders’ equity:

    

Common stock, Euro 0.59 par value, 2.0 billion shares authorised; 445,833,736 shares issued at 30 June 2015 and 445,680,673 shares issued at 31 March 2015

     231.3          231.2     

Additional paid-in capital

     157.3          153.2     

Accumulated deficit

     (745.1)         (586.6)    

Accumulated other comprehensive income (loss)

     0.2          (0.4)    
  

 

 

   

 

 

 

Total shareholders’ deficit

     (356.3)         (202.6)    
  

 

 

   

 

 

 

Total liabilities and shareholders’ deficit

     $         2,077.6          $         2,044.5     
  

 

 

   

 

 

 

 

The accompanying notes are an integral part of these Condensed Consolidated Financial Statements.

 

F-3


James Hardie Industries plc

Condensed Consolidated Statements of Operations and

Comprehensive Income

(Unaudited)

 

 

     Three Months  
     Ended 30 June  
(Millions of US dollars, except per share data)    2015      2014  

Net sales

     $ 428.3           $ 416.8     

Cost of goods sold

     (270.7)          (276.6)    
  

 

 

    

 

 

 

Gross profit

     157.6           140.2     

Selling, general and administrative expenses

     (61.5)          (59.9)    

Research and development expenses

     (7.1)          (8.4)    

Asbestos adjustments

     (4.5)          (21.5)    
  

 

 

    

 

 

 

Operating income

     84.5           50.4     

Interest expense, net of capitalized interest

     (6.1)          (1.7)    

Interest income

     0.2           0.6     

Other income (expense)

     2.7           (3.7)    
  

 

 

    

 

 

 

Income before income taxes

     81.3           45.6     

Income tax expense

     (21.3)          (16.7)    
  

 

 

    

 

 

 

Net income

     $ 60.0           $ 28.9     
  

 

 

    

 

 

 

Income per share - basic:

     

  Basic

     $ 0.13           $ 0.06     

Diluted

     $ 0.13           $ 0.06     

Weighted average common shares outstanding

     

(Millions):

     

  Basic

     445.7           444.7     

Diluted

     447.4           446.0     

Comprehensive income, net of tax:

     

Net income

     $         60.0           $ 28.9     

Cash flow hedges

     -             (0.5)    

Currency translation adjustments

     0.6           5.5     
  

 

 

    

 

 

 

Comprehensive income:

     $ 60.6           $         33.9     
  

 

 

    

 

 

 

 

 

 

The accompanying notes are an integral part of these Condensed Consolidated Financial Statements.

 

F-4


James Hardie Industries plc

Condensed Consolidated Statements of Cash Flows

(Unaudited)

 

 

     Three Months  
     Ended 30 June  
(Millions of US dollars)    2015      2014  

Cash Flows From Operating Activities

     

Net income

     $ 60.0           $ 28.9     
Adjustments to reconcile net income to net cash provided by operating activities      

Depreciation and amortization

     18.2           16.6     

Deferred income taxes

     0.2           5.2     

Stock-based compensation

     3.0           2.1     

Asbestos adjustments

     4.5           21.5     

Tax benefit from stock options exercised

     (0.2)          (0.3)    

Gain on sale of property, plant and equipment

     (1.9)          (0.2)    

Changes in operating assets and liabilities:

     

Restricted cash and cash equivalents

     26.0           12.7     

Accounts and other receivables

     (13.9)          (0.9)    

Inventories

     (0.6)          (13.0)    

Prepaid expenses and other assets

     (4.9)          (1.3)    

Insurance receivable - Asbestos

     3.0           17.5     

Accounts payable and accrued liabilities

     11.8           13.7     

Asbestos liability

     (28.9)          (30.8)    

Other accrued liabilities

     (21.2)          (29.2)    
  

 

 

    

 

 

 

Net cash provided by operating activities

     $ 55.1           $ 42.5     
  

 

 

    

 

 

 

Cash Flows From Investing Activities

     

Purchases of property, plant and equipment

     $     (19.0)          $ (48.6)    

Proceeds from sale of property, plant and equipment

     3.7           -       

Capitalized interest

     (1.1)          -       

Acquisition of assets

     (0.5)          -       
  

 

 

    

 

 

 

Net cash used in investing activities

     $ (16.9)          $ (48.6)    
  

 

 

    

 

 

 

Cash Flows From Financing Activities

     

Proceeds from long-term borrowings

     $ 35.0           -       

Repayments of long-term borrowings

     (50.0)          -       

Proceeds from issuance of shares

     1.0           2.2     

Tax benefit from stock options exercised

     0.2           0.3     

Common stock repurchased and retired

     -             (9.1)    

Dividends paid

     -             (124.6)    
  

 

 

    

 

 

 

Net cash used in financing activities

     $ (13.8)          $     (131.2)    
  

 

 

    

 

 

 

Effects of exchange rate changes on cash

     $ 0.9           $ 1.9     
  

 

 

    

 

 

 

Net increase (decrease) in cash and cash equivalents

     25.3           (135.4)    

Cash and cash equivalents at beginning of period

     67.0           167.5     
  

 

 

    

 

 

 

Cash and cash equivalents at end of period

     $ 92.3           $ 32.1     
  

 

 

    

 

 

 

Components of Cash and Cash Equivalents

     

Cash at bank and on hand

     $ 84.1           $ 25.4     

Short-term deposits

     8.2           6.7     
  

 

 

    

 

 

 

Cash and cash equivalents at end of period

     $ 92.3           $ 32.1     
  

 

 

    

 

 

 

The accompanying notes are an integral part of these Condensed Consolidated Financial Statements.

 

F-5


James Hardie Industries plc

Notes to Condensed Consolidated Financial Statements

 

1. Background and Basis of Presentation

Nature of Operations

James Hardie Industries plc manufactures and sells fiber cement building products for interior and exterior building construction applications, primarily in the United States, Australia, New Zealand, the Philippines and Europe.

Basis of Presentation

The Condensed Consolidated Financial Statements represent the financial position, results of operations and cash flows of James Hardie Industries plc and its wholly-owned subsidiaries and a special purpose entity. Except as otherwise indicated, James Hardie Industries plc is referred to as “JHI plc.” JHI plc, together with its direct and indirect wholly-owned subsidiaries, are collectively referred to as “James Hardie” or the “Company.” These interim Condensed Consolidated Financial Statements should be read in conjunction with the audited Consolidated Financial Statements and the notes thereto, included in the Company’s Annual Report on Form 20-F for the fiscal year ended 31 March 2015, which was filed with the United States Securities and Exchange Commission (“SEC”) on 21 May 2015.

The Condensed Consolidated Financial Statements included herein are unaudited; however, they contain all adjustments (all of which are normal and recurring) which, in the opinion of the Company’s management, are necessary to state fairly the Condensed Consolidated Balance Sheet of the Company at 30 June 2015 and 31 March 2015, the Condensed Consolidated Results of Operations and Comprehensive Income for the three months ended 30 June 2015 and 2014 and Condensed Consolidated Cash Flows for the three months ended 30 June 2015 and 2014.

The Company has recorded on its balance sheet certain assets and liabilities, including asbestos-related assets and liabilities under the terms of the Amended and Restated Final Funding Agreement (“AFFA”), that are denominated in Australian dollars and subject to translation into US dollars at each reporting date. Unless otherwise noted, the exchange rates used to convert Australian dollar denominated amounts into US dollars in the Condensed Consolidated Financial Statements are as follows:

 

     31 March      30 June  
(US$1 = A$)    2015      2015      2014  

Assets and liabilities

     1.3096         1.3028         1.0613   

Statements of operations

     n/a             1.2854         1.0720   

Cash flows - beginning cash

     n/a             1.3096         1.0845   

Cash flows - ending cash

     n/a             1.3028         1.0613   

Cash flows - current period movements

     n/a             1.2854         1.0720   

The results of operations for the three months ended 30 June 2015 are not necessarily indicative of the results to be expected for the full year. The balance sheet at 31 March 2015 has been derived from the audited financial statements at that date but does not include all of the information and footnotes required by accounting principles generally accepted in the United States of America (“US GAAP”) for complete financial statements in this interim financial report.

 

F-6


James Hardie Industries plc

Notes to Condensed Consolidated Financial Statements (Continued)

 

 

2. Recent Accounting Pronouncements

In May 2014, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2014-09, which provides guidance requiring companies to recognize revenue depicting the transfer of goods or services to customers in amounts that reflect the payment to which a company expects to be entitled in exchange for those goods or services. ASU No. 2014-09 also requires additional disclosure about the nature, amount, timing and uncertainty of revenue and cash flows arising from customer contracts, including significant judgments and changes in judgments and assets recognized from costs incurred to obtain or fulfil a contract. ASU No. 2014-09 is effective for annual reporting periods beginning after 15 December 2016, and interim periods within those years, and early adoption is not permitted. However, in July 2015, the FASB voted to defer the effective date of this ASU to annual reporting periods beginning after 15 December 2017. Also, early adoption is permitted for annual reporting periods beginning after 15 December 2016. Companies may use either a full retrospective or a modified retrospective approach to adopt ASU No. 2014-09. The Company is still evaluating the new standard and has not yet determined the potential effects on its consolidated financial statements.

In February 2015, the FASB issued ASU No. 2015-02, which provides explicit guidance about the accounting for consolidation of certain legal entities. The amendments in ASU No. 2015-02 are effective for fiscal years and interim periods within those years, beginning after 15 December 2015, with early adoption permitted. The Company does not expect this new standard to materially impact its consolidated financial statements.

In April 2015, the FASB issued ASU No. 2015-03, which requires that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts. The amendments in ASU No. 2015-03 are effective for fiscal years and interim periods within those years, beginning after 15 December 2015, with early adoption permitted. The new guidance shall be applied on a retrospective basis, wherein the balance sheet of each individual period presented should be adjusted to reflect the period-specific effects of applying the new guidance. The Company will adopt ASU 2015-03 starting with the fiscal year beginning 1 April 2016. The Company does not expect this new standard to materially impact its consolidated financial statements.

In July 2015, the FASB issued ASU No. 2015-11, which requires inventory to be measured at the lower of cost or realizable value. The amendments in ASU No. 2015-11 are effective for fiscal years and interim periods within those years, beginning after 15 December 2016, with early adoption permitted. The new guidance shall be applied on a prospective basis. The Company will adopt ASU 2015-03 starting with the fiscal year beginning 1 April 2016. The Company does not expect this new standard to materially impact its consolidated financial statements.

3. Earnings Per Share

The Company discloses basic and diluted earnings per share (“EPS”). Basic EPS is calculated using net income divided by the weighted average number of common shares outstanding during the period. Diluted EPS is similar to basic EPS except that the weighted average number of common shares outstanding is increased to include the number of additional common shares calculated using the Treasury Method that would have been outstanding if the dilutive potential common shares, such as stock options and restricted stock units (“RSUs”), had been issued.

 

F-7


James Hardie Industries plc

Notes to Condensed Consolidated Financial Statements (Continued)

 

 

Accordingly, basic and dilutive common shares outstanding used in determining net income per share are as follows:

 

    

Three Months

Ended 30 June

 
(Millions of shares)            2015                      2014          

Basic common shares outstanding

     445.7           444.7     

Dilutive effect of stock awards

     1.7           1.3     
  

 

 

    

 

 

 

Diluted common shares outstanding

     447.4           446.0     
  

 

 

    

 

 

 

(US dollars)

     2015                 2014           

Net income per share - basic

   $ 0.13         $ 0.06     

Net income per share - diluted

   $ 0.13         $ 0.06     

Potential common shares of 0.8 million and 1.3 million for the three months ended 30 June 2015 and 2014, respectively, have been excluded from the calculation of diluted common shares outstanding because the effect of their inclusion would be anti-dilutive.

Unless they are anti-dilutive, RSUs which vest solely based on continued employment are considered to be outstanding as of their issuance date for purposes of computing diluted EPS and are included in the calculation of diluted EPS using the Treasury Method. Once these RSUs vest, they are included in the basic EPS calculation on a weighted-average basis.

RSUs which vest based on performance or market conditions are considered contingent shares. At each reporting date prior to the end of the contingency period, the Company determines the number of contingently issuable shares to include in the diluted EPS, as the number of shares that would be issuable under the terms of the RSUs arrangement, if the end of the reporting period were the end of the contingency period. Once these RSUs vest, they are included in the basic EPS calculation on a weighted-average basis.

4. Restricted Cash and Cash Equivalents

Included in restricted cash and cash equivalents is US$5.0 million related to an insurance policy at 30 June 2015 and 31 March 2015, which restricts the cash from use for general corporate purposes.

 

F-8


James Hardie Industries plc

Notes to Condensed Consolidated Financial Statements (Continued)

 

 

5. Inventories

Inventories consist of the following components:

 

     30 June      31 March  
(Millions of US dollars)                2015                              2015              

Finished goods

   $ 149.0         $ 150.6     

Work-in-process

     8.4           6.6     

Raw materials and supplies

     57.8           67.5     

Provision for obsolete finished goods and raw materials

     (7.6)          (6.7)    
  

 

 

    

 

 

 

Total inventories

   $ 207.6         $ 218.0     
  

 

 

    

 

 

 

As of 30 June 2015 and 31 March 2015, US$23.3 million and US$22.2 million, respectively, of the Company’s finished goods inventory was held at third-party locations.

6. Long-Term Debt

The Company holds two forms of long-term debt; bilateral credit facilities and senior unsecured notes. The effective weighted average interest rate on the Company’s total debt was 5.2% and 5.0% at 30 June 2015 and 31 March 2015, respectively. The weighted average term of all long-term debt, including undrawn facilities, is 4.1 years at 30 June 2015.

Bilateral Credit Facilities

At 30 June 2015, the Company’s bilateral credit facilities consisted of:

 

Description   

Effective

Interest Rate

    Total
    Facility    
     Principal
    Drawn    
 

(US$ millions)

       

Term facilities, can be drawn in US$, variable interest rates based on

LIBOR plus margin, can be repaid and redrawn until March 2016

     -      $ 50.0            

Term facilities, can be drawn in US$, variable interest rates based on

LIBOR plus margin, can be repaid and redrawn until April 2016

     -        150.0            

Term facilities, can be drawn in US$, variable interest rates based on

LIBOR plus margin, can be repaid and redrawn until April 2017

     -        100.0            

Term facilities, can be drawn in US$, variable interest rates based on

LIBOR plus margin, can be repaid and redrawn until November 2017

     1.4     125.0          60.0    

Term facilities, can be drawn in US$, variable interest rates based on

LIBOR plus margin, can be repaid and redrawn until March 2019

     -        40.0            

Term facilities, can be drawn in US$, variable interest rates based on

LIBOR plus margin, can be repaid and redrawn until April 2019

     -        50.0            

Term facilities, can be drawn in US$, variable interest rates based on

LIBOR plus margin, can be repaid and redrawn until May 2019

     -        75.0            
    

 

 

    

 

 

 

Total

     $ 590.0        $ 60.0    
    

 

 

    

 

 

 

 

F-9


James Hardie Industries plc

Notes to Condensed Consolidated Financial Statements (Continued)

 

 

The amount drawn under the combined bilateral credit facilities was US$60.0 million and US$75.0 million at 30 June 2015 and 31 March 2015, respectively.

The effective weighted average interest rate on the Company’s total outstanding bilateral credit facilities was 1.4% at 30 June 2015 and 31 March 2015. The weighted average term of all bilateral credit facilities is 2.2 years at 30 June 2015. The weighted average fixed interest rate on the Company’s interest rate swap contracts is set forth in Note 8.

The interest rate is calculated two business days prior to the commencement of each draw-down period based on the US$ London Interbank Offered Rate (“LIBOR”) plus the margins of individual lenders and is payable at the end of each draw-down period.

At 30 June 2015, the Company was in compliance with all restrictive debt covenants contained in its bilateral credit facility agreements. Under the most restrictive of these covenants, the Company (i) must not exceed a maximum of net debt to earnings before interest, tax, depreciation and amortization, excluding all income, expense and other profit and loss statement impacts of Asbestos Injuries Compensation Fund (“AICF”), ABN 60 Pty Limited (“ABN 60”) and two of its former subsidiaries, Amaca Pty Limited (“Amaca”) and Amaba Pty Limited (“Amaba” and together with ABN 60 and Amaca, the “Former James Hardie Companies”) and Marlew Mining Pty Limited (“Marlew”) and excluding assets, liabilities and other balance sheet items of AICF, the Former James Hardie Companies and Marlew, (ii) must meet or exceed a minimum ratio of earnings before interest and taxes to net interest charges, excluding all income, expense and other profit and loss statement impacts of AICF, the Former James Hardie Companies and Marlew, and (iii) must ensure that no more than 35% of Free Cash Flow (as defined in the AFFA), in any given financial year (“Annual Cash Flow Cap”) is contributed to AICF on the payment dates under the AFFA in the next following financial year. The Annual Cash Flow Cap does not apply to payments of interest, if any, to AICF and is consistent with contractual obligations of James Hardie 117 Pty Ltd (the “Performing Subsidiary”) and the Company under the AFFA.

Subsequent to 30 June 2015, the Company drew US$233.0 million from its combined bilateral credit facilities to fund dividend payments and the AICF contribution payment.

Senior Unsecured Notes

In February 2015, James Hardie International Finance Limited, a wholly-owned subsidiary of JHI plc, completed the sale of US$325.0 million aggregate principal amount of senior unsecured notes due 15 February 2023. Interest is payable semi-annually in arrears on 15 February and 15 August of each year, commencing 15 August 2015, at a rate of 5.875%.

The senior notes were sold at an offering price of 99.213% of par value, an original issue discount of US$2.6 million. Debt issuance costs of US$8.3 million were recorded in Other Current and Other Non-Current Assets on the Company’s consolidated balance sheet in conjunction with the offering. Both the discount and the debt issuance costs are being amortized as interest expense using the effective interest method over the stated term of 8 years. The discount and debt issuance costs have an unamortized balance of US$2.4 million and US$7.8 million at 30 June 2015, respectively.

The indenture governing the senior notes contains covenants that, among other things, limit the ability of James Hardie International Group Limited, James Hardie Building Products Inc., James Hardie Technology Limited and their restricted subsidiaries to incur liens on assets, make certain restricted payments, engage in certain sale and leaseback transactions and merge or consolidate with or into other companies. These covenants are subject to certain exceptions and qualifications as described in the indenture. At 30 June 2015, the Company was in compliance with all of its requirements under the indenture related to the senior notes.

 

F-10


James Hardie Industries plc

Notes to Condensed Consolidated Financial Statements (Continued)

 

 

7. Asbestos

In February 2007, the Company’s shareholders approved the AFFA, an agreement pursuant to which the Company provides long-term funding to AICF.

Asbestos Adjustments

Asbestos-related assets and liabilities are denominated in Australian dollars. The reported values of these asbestos-related assets and liabilities in the Company’s Condensed Consolidated Balance Sheets in US dollars are subject to adjustment depending on the closing exchange rate between the two currencies at the balance sheet dates, the effect of which is included in Asbestos adjustments in the Condensed Consolidated Statements of Operations and Comprehensive Income. The asbestos adjustments for the three months ended 30 June 2015 and 2014 are US$4.5 million and US$21.5 million, respectively.

Claims Data

The following table shows the activity related to the numbers of open claims, new claims and closed claims during each of the past five years and the average settlement per settled claim and case closed:

 

     Three Months                                     
     Ended      For the Years Ended 31 March  
     30 June 2015      2015      2014      2013      2012      2011  
                                                  

Number of open claims at beginning of period

     494         466         462         592         564         529   

Number of new claims

     139         665         608         542         456         494   

Number of closed claims

     173         637         604         672         428         459   

Number of open claims at end of period

     460         494         466         462         592         564   

Average settlement amount per settled claim

     A$232,604       A$ 254,209       A$ 253,185       A$ 231,313       A$ 218,610       A$ 204,366   

Average settlement amount per case closed

     A$213,781       A$ 217,495       A$ 212,944       A$ 200,561       A$ 198,179       A$ 173,199   

Average settlement amount per settled claim

     US$ 180,959       US$  222,619       US$  236,268       US$  238,615       US$  228,361       US$  193,090   

Average settlement amount per case closed

     US$ 166,315       US$ 190,468       US$ 198,716       US$ 206,892       US$ 207,019       US$ 163,642   

Under the terms of the AFFA, the Company has rights of access to actuarial information produced for AICF by the actuary appointed by AICF, which is currently KPMG Actuarial Pty Ltd. The Company’s disclosures with respect to claims statistics are subject to it obtaining such information, however, the AFFA does not provide the Company an express right to audit or otherwise require independent verification of such information or the methodologies to be adopted by the approved actuary. As such, the Company relies on the accuracy and completeness of the information and analysis of the approved actuary when making disclosures with respect to claims statistics.

 

F-11


James Hardie Industries plc

Notes to Condensed Consolidated Financial Statements (Continued)

 

 

Asbestos-Related Assets and Liabilities

The Company has included on its Condensed Consolidated Balance Sheets certain asbestos-related assets and liabilities under the terms of the AFFA. These amounts are detailed in the table below, and the net total of these asbestos-related assets and liabilities is referred to by the Company as the “Net AFFA Liability.”

 

     30 June      31 March  
(Millions of US dollars)            2015                      2015          

Asbestos liability – current

   $ (132.3)        $ (131.6)    

Asbestos liability – non-current

     (1,268.2)          (1,290.0)    
  

 

 

    

 

 

 

Asbestos liability - Total

     (1,400.5)          (1,421.6)    

Insurance receivable – current

     16.8           16.7     

Insurance receivable – non-current

     159.7           161.9     
  

 

 

    

 

 

 

Insurance receivable – Total

     176.5           178.6     

Workers’ compensation asset – current

     4.6           4.5     

Workers’ compensation asset – non-current

     45.8           45.5     

Workers’ compensation liability – current

     (4.6)          (4.5)    

Workers’ compensation liability – non-current

     (45.8)          (45.5)    
  

 

 

    

 

 

 

Workers’ compensation – Total

     -         -   

Loan facility

     (27.5)          (13.6)    

Other net liabilities

     (1.8)          (1.5)    

Restricted cash and cash equivalents of the AICF

     10.0           22.0     
  

 

 

    

 

 

 

Net AFFA liability

   $ (1,243.3)        $ (1,236.1)    
  

 

 

    

 

 

 

Deferred income taxes – current

     13.9           15.9     

Deferred income taxes – non-current

     389.7           389.3     
  

 

 

    

 

 

 

Deferred income taxes – Total

     403.6           405.2     

Income tax payable

     23.2           19.2     
  

 

 

    

 

 

 

Net Unfunded AFFA liability, net of tax

   $ (816.5)        $ (811.7)    
  

 

 

    

 

 

 

 

F-12


James Hardie Industries plc

Notes to Condensed Consolidated Financial Statements (Continued)

 

 

The following is a detailed rollforward of the Net Unfunded AFFA liability, net of tax, at 30 June 2015:

 

(Millions of US dollars)   Asbestos
Liability
    Insurance
Receivables
   

Deferred Tax

Assets 1

   

Other Loan

Facilities

    Restricted
Cash and
Investments
   

Other
Assets and

Liabilities 2

   

Net Unfunded

AFFA Liability,

net of tax

 

Opening Balance - 31 March 2015

  $ (1,421.6   $ 178.6      $ 405.2      $ (13.6   $ 22.0      $ 17.7      $ (811.7

Asbestos claims paid 3

    28.6              (28.6         -       

AICF claims-handling costs incurred (paid)

    0.3              (0.3         -       

AICF operating costs paid - non claims-handling

            (0.5         (0.5

Insurance recoveries

      (3.0         3.0            -       

Offset to Income Tax Payable

        (4.0         4.0        -       

Funds received from NSW under loan agreement

          (13.5     13.5            -       

Other movements

      (0.1     0.3        (0.2     0.4        (0.2     0.2   

Effect of foreign exchange

    (7.8     1.0        2.1        (0.2     0.5        (0.1     (4.5

Closing Balance - 30 June 2015

  $ (1,400.5   $ 176.5      $ 403.6      $ (27.5   $ 10.0      $ 21.4      $ (816.5
       

 

1

A portion of the deferred income tax asset was applied against the Company’s income tax payable. At 30 June 2015 and 31 March 2015, these amounts were US$23.2 million and US$19.2 million, respectively. During the three months ended 30 June 2015, there was a US$0.1 million unfavorable effect of foreign currency exchange in respect of income tax payable.

 

2

Other assets and liabilities include income tax of US$23.2 million and US$19.2 million at 30 June 2015 and 31 March 2015, respectively. The remaining balance includes the other assets and liabilities of AICF, including a provision for asbestos-related education and medical research contributions of US$1.4 million at 30 June 2015 and 31 March 2015. Also included are trade receivables, prepayments, fixed assets, trade payables and accruals of AICF. These other assets and liabilities of AICF were a net liability of US$0.4 million and US$0.1 million at 30 June 2015 and 31 March 2015, respectively.

 

3

Claims paid of US$28.6 million reflects A$36.8 million converted at the average exchange rate for the period based on the assumption that these transactions occurred evenly throughout the period.

AICF Funding

On 1 July 2015, the Company made a payment of A$81.1 million (US$62.8 million) to AICF, representing 35% of its free cash flow for fiscal year 2015. For the 1 July 2015 payment, free cash flow, as defined in the AFFA, was equivalent to the Company’s fiscal year 2015 operating cash flows of US$179.5 million. For the three months ended 30 June 2015, the Company did not provide financial or other support to AICF that it was not previously contractually required to provide.

AICF – NSW Government Secured Loan Facility

AICF may borrow up to an aggregate amount of A$320.0 million (US$245.6 million, based on the exchange rate at 30 June 2015). The AICF Loan Facility is available to be drawn for the payment of claims through 1 November 2030, at which point, all outstanding borrowings must be repaid. Borrowings made under the AICF Loan Facility are classified as current, as AICF intends to repay the debt within one year.

 

F-13


James Hardie Industries plc

Notes to Condensed Consolidated Financial Statements (Continued)

 

 

Interest accrues daily on amounts outstanding, is calculated based on a 365-day year and is payable monthly. AICF may, at its discretion, elect to accrue interest payable on amounts outstanding under the AICF Loan Facility on the date interest becomes due and payable.

At 30 June 2015 and 31 March 2015, AICF had an outstanding balance under the Facility of US$27.5 million and US$13.6 million, respectively.

8. Derivative Instruments

The Company uses derivatives for risk management purposes and does not engage in speculative activity. A key risk management objective for the Company is to mitigate interest rate risk associated with the Company’s external credit facilities and foreign currency risk primarily with respect to forecasted transactions denominated in foreign currencies. The determination of whether the Company enters into a derivative transaction to achieve these risk management objectives depends on a number of factors, including market related factors that impact the extent to which derivative instruments will achieve such risk management objectives of the Company.

The Company may from time to time enter into interest rate swap contracts to protect against upward movements in US Dollar LIBOR and the associated interest the Company pays on its external credit facilities. Interest rate swaps are recorded in the financial statements at fair value. Changes in fair value are recorded in the Condensed Consolidated Statements of Operations and Comprehensive Income in Other income (expense) .

The Company uses foreign currency forward contracts to mitigate exposure to foreign currency fluctuations. The forward contracts at 30 June 2015 were primarily related to the dividends announced in May 2015, and the AICF payment paid in July 2015. Changes in fair value are recorded in the Condensed Consolidated Statements of Operations and Comprehensive Income in Other income (expense) .

Interest Rate Swaps

For interest rate swap contracts, the Company has agreed to pay fixed interest rates while receiving a floating interest rate. These contracts have a fair value of US$2.3 million and US$3.1 million at 30 June 2015 and 31 March 2015, respectively, which is included in Accounts payable and accrued liabilities.

At 30 June 2015, the weighted average fixed interest rate of these contracts is 2.0% and the weighted average remaining life is 4.2 years. For the three months ended 30 June 2015, the Company included in Other income (expense) an unrealized gain of US$0.8 million on interest rate swap contracts. Included in Interest expense was a realized loss on settlements of interest rate swap contracts of US$0.6 million for the three months ended 30 June 2015.

For the three months ended 30 June 2014, the Company included in Other income (expense) an unrealized loss of US$1.3 million, on interest rate swap contracts. Included in Interest expense was a realized loss on settlements of interest rate swap contracts of US$0.2 million for the three months ended 30 June 2014.

 

F-14


James Hardie Industries plc

Notes to Condensed Consolidated Financial Statements (Continued)

 

 

Foreign Currency Forward Contracts

Changes in the fair value of forward contracts that are not designated as hedges are recorded in earnings within Other income (expense) at each measurement date. As discussed above, these derivatives are typically entered into as economic hedges of changes in currency exchange rates. Gains or losses related to the derivative are recorded in income, based on the Company’s accounting policy. In general, the earnings effects of the item that represent the economic risk exposure are recorded in the same caption as the derivative. The forward contracts not designated as a cash flow hedging arrangement had an unrealized loss of US$2.8 million in the three months ended 30 June 2015. This loss was partially offset by the $2.6 million gain on the revaluation of the dividends payable balance, for an ending loss in Other income (expense) of US$0.2 million.

The notional amount of interest rate swap contracts and foreign currency forward contracts represents the basis upon which payments are calculated and are reported on a net basis when a legal and enforceable right of set-off exists. The following table sets forth the total outstanding notional amount and the fair value of the Company’s derivative instruments.

 

                  

Fair Value as of

 

 
(Millions of US dollars)    Notional Amount      30 June 2015      31 March 2015  
     30 June
2015
     31 March
2015
     Assets      Liabilities      Assets      Liabilities  

Derivatives not accounted for as hedges

                 

Foreign currency forward contracts

     $ 279.5           $ 3.6           $ -               $ 3.0           $ -               $ 0.2     

Interest rate swap contracts

     100.0           125.0           -               2.3           -               3.1     
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

Total

     $       379.5           $       128.6           $       -               $       5.3           $       -               $       3.3     
  

 

 

    

 

 

    

 

 

    

 

 

    

 

 

    

 

 

 

9. Fair Value Measurements

Assets and liabilities of the Company that are carried at fair value are classified in one of the following three categories:

 

Level 1

Quoted market prices in active markets for identical assets and liabilities that the Company has the ability to access at the measurement date;

 

Level 2

Observable market-based inputs or unobservable inputs that are corroborated by market data for the asset or liability at the measurement date;

 

Level 3

Unobservable inputs that are not corroborated by market data used when there is minimal market activity for the asset or liability at the measurement date.

Fair value measurements of assets and liabilities are assigned a level within the fair value hierarchy based on the lowest level of any input that is significant to the fair value measurement in its entirety.

At 30 June 2015, the Company’s financial instruments consist primarily of cash and cash equivalents, restricted cash and cash equivalents, trade receivables, trade payables, dividends payable, bilateral credit facilities, senior unsecured notes, interest rate swaps and foreign currency forward contracts.

 

F-15


James Hardie Industries plc

Notes to Condensed Consolidated Financial Statements (Continued)

 

 

Cash and cash equivalents, Restricted cash and cash equivalents, Trade receivables, Trade payables, Dividend payables and Bilateral credit facilities – The carrying amounts for these items approximates their respective fair values due to the short maturity of these instruments.

Senior unsecured notes - The Company’s senior unsecured notes have an estimated fair value of US$334.8 million at 30 June 2015 based on the trading price observed in the market at or near the balance sheet date and are categorized as Level 1 within the fair value hierarchy.

Interest rate swaps - The fair value of interest rate swap contracts is calculated based on the fixed rate, notional principal, settlement date and present value of the future cash inflows and outflows based on the terms of the agreement and the future floating interest rates as determined by a future interest rate yield curve. The model used to value the interest rate swap contracts is based upon well recognized financial principles, and interest rate yield curves can be validated through readily observable data by external sources. Although readily observable data is used in the valuations, different valuation methodologies could have an effect on the estimated fair value. Accordingly, the interest rate swap contracts are categorized as Level 2.

Foreign currency forward contracts - The Company’s foreign currency forward contracts are valued using models that maximize the use of market observable inputs including interest rate curves and both forward and spot prices for currencies and are categorized as Level 2 within the fair value hierarchy.

The following table sets forth by level within the fair value hierarchy, the Company’s financial assets and liabilities that were accounted for at fair value on a recurring basis at 30 June 2015 according to the valuation techniques the Company used to determine their fair values.

 

     Fair Value at      Fair Value Measurements
Using Inputs Considered as
 
(Millions of US dollars)    30 June 2015          Level 1              Level 2              Level 3      

Interest rate swap contracts included in Other liabilities

     $ 2.3           $ -             $ 2.3           $ -       

Forward contracts included in Other liabilities

     3.0           -             3.0           -       
  

 

 

    

 

 

    

 

 

    

 

 

 

Total Liabilities

     $ 5.3           $ -             $ 5.3           $ -       
  

 

 

    

 

 

    

 

 

    

 

 

 

 

F-16


James Hardie Industries plc

Notes to Condensed Consolidated Financial Statements (Continued)

 

 

10. Commitments and Contingencies

The Company is involved from time to time in various legal proceedings and administrative actions related to the normal conduct of its business, including general liability claims, putative class action lawsuits and litigation concerning its products.

Although it is impossible to predict the outcome of any pending legal proceeding, management believes that such proceedings and actions should not, individually or in the aggregate, have a material adverse effect on the Company’s consolidated financial position, results of operations or cash flows, except as they relate to asbestos as described in these financial statements.

Environmental and Legal

The operations of the Company, like those of other companies engaged in similar businesses, are subject to a number of laws and regulations on air and water quality, waste handling and disposal. The Company’s policy is to accrue for environmental costs when it is determined that it is probable that an obligation exists and the amount can be reasonably estimated.

11. Income Taxes

Income taxes payable represents taxes currently payable which are computed at statutory income tax rates applicable to taxable income derived in each jurisdiction in which the Company conducts business. During the three months ended 30 June 2015, the Company paid tax net of any refunds received of US$4.3 million in Ireland, the United States, Canada and New Zealand.

Deferred income taxes include European and Australian net operating loss carry-forwards. At 30 June 2015 the Company had European tax loss carry-forwards of approximately US$6.3 million and Australian tax loss carry-forwards of approximately US$11.7 million, that are available to offset future taxable income in the respective jurisdiction.

The European tax loss carry-forwards relate to losses incurred in prior years during the establishment of the European business. At 30 June 2015, the Company had a valuation allowance against a portion of the European tax loss carry-forwards in respect of which realization is not more likely than not. During the three months ended 30 June 2015, the Company reversed a valuation allowance of US$2.4 million for a portion of its European tax loss carry-forwards for which realization is now more likely than not.

The Australian tax loss carry-forwards primarily result from current and prior year tax deductions for contributions to AICF. The Performing Subsidiary is able to claim a tax deduction for its contributions to AICF over a five-year period commencing in the year the contribution is incurred. At 30 June 2015, the Company recognized a tax deduction of US$13.5 million (A$17.3 million) for the current year relating to total contributions to AICF of US$412.3 million (A$419.1 million) incurred in tax years 2011 through 2015.

Due to the size and nature of its business, the Company is subject to ongoing reviews by taxing jurisdictions on various tax matters. The Company accrues for tax contingencies based upon its best estimate of the taxes ultimately expected to be paid, which it updates over time as more information becomes available. Such amounts are included in taxes payable or other non-current liabilities, as appropriate. If the Company ultimately determines that payment of these amounts is unnecessary, the Company reverses the liability and recognizes a tax benefit during the period in which the Company determines that the liability is no longer necessary. The Company records additional tax expense in the period in which it determines that the recorded tax liability is less than the ultimate assessment it expects.

 

F-17


James Hardie Industries plc

Notes to Condensed Consolidated Financial Statements (Continued)

 

 

The Company or its subsidiaries files income tax returns in various jurisdictions including Ireland, the United States, Australia, New Zealand, the Philippines and The Netherlands. The Company is no longer subject to US federal examinations by US Internal Revenue Service (“IRS”) for tax years prior to tax year 2012 and Australian federal examinations by the Australian Taxation Office (“ATO”) for tax years prior to tax year 2011. The Company is no longer subject to examinations by The Netherlands tax authority, for tax years prior to tax year 2010.

Taxing authorities from various jurisdictions in which the Company operates are in the process of reviewing and auditing the Company’s respective jurisdictional tax returns for various ranges of years. The Company accrues tax liabilities in connection with ongoing audits and reviews based on knowledge of all relevant facts and circumstances, taking into account existing tax laws, its experience with previous audits and settlements, the status of current tax examinations and how the tax authorities view certain issues.

Unrecognized Tax Benefits

A reconciliation of the beginning and ending amount of unrecognized tax benefits and interest and penalties are as follows:

 

(Millions of US Dollars)     Unrecognized    
  tax benefits    
      Interest and    
  Penalties    
 

Balance at 31 March 2015

    $ 4.9          $ 0.3     
 

 

 

   

 

 

 

(Reductions) / additions for tax positions of the current year

    (3.3)         0.2     
 

 

 

   

 

 

 

Balance at 30 June 2015

    $ 1.6          $ 0.5     
 

 

 

   

 

 

 

As of 30 June 2015, the total amount of unrecognized tax benefits and the total amount of interest and penalties accrued or prepaid by the Company related to unrecognized tax benefits that, if recognized, would affect the effective tax rate is US$0.9 million and US$0.5 million, respectively. The remaining US$0.7 million of unrecognized tax benefits would not affect the effective tax rate if recognized.

The Company recognizes penalties and interest accrued related to unrecognized tax benefits in income tax expense. During the three months ended 30 June 2015, the total amount of interest and penalties recognized in tax expense was US$0.2 million. The liabilities associated with uncertain tax benefits are included in Other liabilities on the Company’s Condensed Consolidated Balance Sheet. These liabilities are offset by deferred tax assets included in Current assets on the Company’s Condensed Consolidated Balance Sheet. The Company recognizes deferred tax assets and liabilities for temporary differences between the financial reporting basis and the tax basis of its assets and liabilities along with net operating loss and tax credit carryovers. Management believes it is more likely than not that the full deferred tax asset will be realized.

 

F-18


James Hardie Industries plc

Notes to Condensed Consolidated Financial Statements (Continued)

 

 

12. Stock-Based Compensation

Total stock-based compensation expense consists of the following:

 

     Three Months  
     Ended 30 June  
(Millions of US dollars)    2015      2014  

Liability Awards Expense

     $ 1.9           $ 1.3     

Equity Awards Expense

     3.0           1.9     
  

 

 

    

 

 

 

Total stock-based compensation expense

     $         4.9           $         3.2     
  

 

 

    

 

 

 

As of 30 June 2015, the unrecorded future stock-based compensation expense related to outstanding equity awards was US$10.9 million after estimated forfeitures and will be recognized over an estimated weighted average amortization period of 1.3 years.

13. Capital Management and Dividends

The following table summarizes the dividends declared or paid during fiscal years 2014, 2015 and 2016:

 

(Millions of US dollars)    US
Cents/Security
   US$ Total
Amount
   Announcement Date    Record Date    Payment Date

FY 2015 special dividend

   0.22    98.1    21 May 2015    11 June 2015    7 August 2015

FY 2015 second half dividend

   0.27    120.4    21 May 2015    11 June 2015    7 August 2015

FY 2015 first half dividend

   0.08    34.2    19 November 2014    23 December 2014    27 February 2015

FY 2014 special dividend

   0.20    89.0    22 May 2014    12 June 2014    8 August 2014

FY 2014 second half dividend

   0.32    142.3    22 May 2014    12 June 2014    8 August 2014

125 year anniversary special dividend

   0.28    124.6    28 February 2014    21 March 2014    30 May 2014

FY 2014 first half dividend

   0.08    35.5    14 November 2013    19 December 2013    28 March 2014

FY 2013 special dividend

   0.24    106.1    23 May 2013    28 June 2013    26 July 2013

FY 2013 second half dividend

   0.13    57.5    23 May 2013    28 June 2013    26 July 2013

On 21 May 2015, the Company announced a new share buyback program to acquire up to 5% of its issued capital. No shares were repurchased or cancelled under this program for the three months ended 30 June 2015.

Subsequent to 30 June 2015, the Company acquired 1,653,247 shares of its common stock, with an aggregate cost of A$30.0 million (US$22.5 million), at an average market price of A$18.14 (US$13.58).

 

F-19


James Hardie Industries plc

Notes to Condensed Consolidated Financial Statements (Continued)

 

 

14. Operating Segment Information and Concentrations of Risk

The Company has reported its operating segment information in the format that the operating segment information is available to and evaluated by senior management. USA and Europe Fiber Cement manufactures fiber cement interior linings, exterior siding products and related accessories in the United States; these products are sold in the United States, Canada and Europe. Asia Pacific Fiber Cement includes all fiber cement manufactured in Australia, New Zealand and the Philippines and sold in Australia, New Zealand, Asia, the Middle East (Israel, Kuwait, Qatar and United Arab Emirates), and various Pacific Islands. Research and Development represents the cost incurred by the research and development centers. General Corporate primarily consists of officer and employee compensation and related benefits, professional and legal fees, administrative costs, and rental expense net of rental income on the Company’s corporate offices.

Operating Segments

The following is the Company’s operating segment information:

 

     Net Sales to Customers 1  
     Three Months Ended 30 June  
(Millions of US dollars)    2015      2014  

USA & Europe Fiber Cement

     $ 337.0           $ 321.5     

Asia Pacific Fiber Cement

     91.3           95.3     
  

 

 

    

 

 

 

Worldwide total

     $             428.3           $             416.8     
  

 

 

    

 

 

 
     Income Before Income Taxes  
     Three Months Ended 30 June  
(Millions of US dollars)    2015      2014  

USA & Europe Fiber Cement 2

     $ 89.5           $ 68.0     

Asia Pacific Fiber Cement 2,7

     19.5           22.0     

Research and Development 2

     (6.0)          (6.8)    
  

 

 

    

 

 

 

Segments total

     103.0           83.2     

General Corporate 3

     (18.5)          (32.8)    
  

 

 

    

 

 

 

Total operating income

     84.5           50.4     

Net interest expense 4

     (5.9)          (1.1)    

Other income (expense)

     2.7           (3.7)    
  

 

 

    

 

 

 

Worldwide total

     $ 81.3           $ 45.6     
  

 

 

    

 

 

 

 

F-20


James Hardie Industries plc

Notes to Condensed Consolidated Financial Statements (Continued)

 

 

     Total Identifiable Assets  
     30 June      31 March  
(Millions of US dollars)    2015      2015  

USA & Europe Fiber Cement

    $ 982.4          $ 959.3     

Asia Pacific Fiber Cement

     287.5           279.8     

Research and Development

     14.5           20.7     
  

 

 

    

 

 

 

Segments total

     1,284.4           1,259.8     

General Corporate 5, 6

     793.2           784.7     
  

 

 

    

 

 

 

Worldwide total

    $         2,077.6          $         2,044.5     
  

 

 

    

 

 

 

The following is the Company’s geographical information:

 

     Net Sales to Customers 1  
     Three Months Ended 30 June  
(Millions of US dollars)    2015      2014  

USA

    $ 327.1          $ 311.5     

Australia

     61.5           67.6     

New Zealand

     15.8           16.4     

Other Countries

     23.9           21.3     
  

 

 

    

 

 

 

Worldwide total

    $            428.3          $            416.8     
  

 

 

    

 

 

 
     Total Identifiable Assets  
     30 June      31 March  
(Millions of US dollars)    2015      2015  

USA

    $ 964.0          $ 956.4     

Australia

     230.6           223.4     

New Zealand

     23.7           25.8     

Other Countries

     66.1           54.2     
  

 

 

    

 

 

 

Segments total

     1,284.4           1,259.8     

General Corporate 5, 6

     793.2           784.7     
  

 

 

    

 

 

 

Worldwide total

    $ 2,077.6          $ 2,044.5     
  

 

 

    

 

 

 

 

 

1

    Inter-segmental sales are not significant.

 

F-21


James Hardie Industries plc

Notes to Condensed Consolidated Financial Statements (Continued)

 

 

2

The following table summarizes research and development costs by segment:

 

     Three Months  
     Ended 30 June  
(Millions of US dollars)    2015      2014  

USA & Europe Fiber Cement

     $ 1.3         $ 1.8   

Asia Pacific Fiber Cement

     0.3         0.3   

Research and Development a

     5.5         6.3   
  

 

 

    

 

 

 
     $     7.1         $       8.4   
  

 

 

    

 

 

 

 

  a  

For the three months ended 30 June 2015 and 2014, the R&D segment also included SG&A expenses of US$0.5 million.

 

3

Included in the General Corporate segment are the following:

 

     Three Months  
     Ended 30 June  
(Millions of US dollars)    2015      2014  

Asbestos Adjustments

     $    (4.5)         $    (21.5)   

AICF SG&A expenses

     (0.5)         (0.6)   

 

4

The Company does not report net interest expense for each operating segment as operating segments are not held directly accountable for interest expense. Included in net interest expense is AICF interest income of US$0.1 million and AICF net interest expense of US$0.2 million for the three months ended 30 June 2015 and 2014, respectively. See Note 7 for more information.

 

5

The Company does not report deferred tax assets and liabilities for each operating segment as operating segments are not held directly accountable for deferred income taxes. All deferred income taxes are included in the General Corporate segment.

 

6

Asbestos-related assets at 30 June 2015 and 31 March 2015 are US$641.9 million and US$657.3 million, respectively, and are included in the General Corporate segment.

 

7

Included in the Asia Pacific Fiber Cement segment for the three months ended 30 June 2015 was a gain on the sale of the Australian Pipes business of US$2.1 million.

 

F-22


James Hardie Industries plc

Notes to Condensed Consolidated Financial Statements (Continued)

 

 

15. Reclassifications Out of Accumulated Other Comprehensive Income (Loss)

During the three months ended 30 June 2015 there were no reclassifications out of Accumulated other comprehensive income (loss):

 

                                                                                       
(Millions of US dollars)    Pension and
Post-Retirement
Benefit
Adjustment
     Cash Flow
Hedges
     Foreign
Currency
Translation
Adjustments
     Total  

Balance at 31 March 2015

   $ (0.3)       $ 0.3       $ (0.4)       $ (0.4)   

Other comprehensive income before reclassifications

     -               -               0.6       $ 0.6   
  

 

 

    

 

 

    

 

 

    

 

 

 

Balance at 30 June 2015

   $ (0.3)       $ 0.3       $ 0.2       $ 0.2   
  

 

 

    

 

 

    

 

 

    

 

 

 

 

F-23

Annual General Meeting
14 August 2015
Exhibit 99.6


PAGE
DISCLAIMER
FORWARD-LOOKING STATEMENTS
This
Management
Presentation
contains
forward-looking
statements.
James
Hardie
Industries
plc
(the
“company”)
may
from
time
to
time
make
forward-looking
statements
in
its
periodic
reports
filed
with
or
furnished
to
the
Securities
and
Exchange
Commission,
on
Forms
20-F
and
6-K,
in
its
annual
reports
to
shareholders,
in
offering
circulars,
invitation
memoranda
and
prospectuses,
in
media
releases
and
other
written
materials
and
in
oral
statements
made
by
the
company’s
officers,
directors
or
employees
to
analysts,
institutional
investors,
existing
and
potential
lenders,
representatives
of
the
media
and
others.
Statements
that
are
not
historical
facts
are
forward-looking
statements
and
such
forward-looking
statements
are
statements
made
pursuant
to
the
Safe
Harbor
Provisions
of
the
Private
Securities
Litigation
Reform
Act
of
1995.
Examples
of
forward-looking
statements
include:
statements
about
the
company’s
future
performance;
projections
of
the
company’s
results
of
operations
or
financial
condition;
statements
regarding
the
company’s
plans,
objectives
or
goals,
including
those
relating
to
strategies,
initiatives,
competition,
acquisitions,
dispositions
and/or
its
products;
expectations
concerning
the
costs
associated
with
the
suspension
or
closure
of
operations
at
any
of
the
company’s
plants
and
future
plans
with
respect
to
any
such
plants;
expectations
concerning
the
costs
associated
with
the
significant
capital
expenditure
projects
at
any
of
the
company’s
plants
and
future
plans
with
respect
to
any
such projects;
expectations
regarding
the
extension
or
renewal
of
the
company’s
credit
facilities
including
changes
to
terms,
covenants
or
ratios;
expectations
concerning
dividend
payments
and
share
buy-backs;
statements
concerning
the
company’s
corporate
and
tax
domiciles
and
structures
and
potential
changes
to
them,
including
potential
tax
charges;
statements
regarding
tax
liabilities
and
related
audits,
reviews
and
proceedings;
expectations
about
the
timing
and
amount
of
contributions
to
Asbestos
Injuries
Compensation
Fund
(AICF),
a
special
purpose
fund
for
the
compensation
of
proven
Australian
asbestos-related
personal
injury
and
death
claims;
expectations
concerning
indemnification
obligations;
expectations
concerning
the
adequacy
of
the
company’s
warranty
provisions
and
estimates
for
future
warranty-related
costs;
statements
regarding
the
company’s
ability
to
manage
legal
and
regulatory
matters
(including
but
not
limited
to
product
liability,
environmental,
intellectual
property
and
competition
law
matters)
and
to
resolve
any
such
pending
legal
and
regulatory
matters
within
current
estimates
and
in
anticipation
of
certain
third-
party
recoveries;
and
statements
about
economic
conditions,
such
as
changes
in
the
US
economic
or
housing
recovery
or
changes
in
the
market
conditions
in
the
Asia
Pacific
region,
the
levels
of
new
home
construction
and
home
renovations,
unemployment
levels,
changes
in
consumer
income,
changes
or
stability
in
housing
values,
the
availability
of
mortgages
and
other
financing,
mortgage
and
other
interest
rates,
housing
affordability
and
supply,
the
levels
of
foreclosures
and
home
resales,
currency
exchange
rates,
and
builder
and
consumer
confidence.
2


PAGE
DISCLAIMER (continued)
Words
such
as
“believe,”
“anticipate,”
“plan,”
“expect,”
“intend,”
“target,”
“estimate,”
“project,”
“predict,”
“forecast,”
“guideline,”
“aim,”
“will,”
“should,”
“likely,”
“continue,”
“may,”
“objective,”
“outlook”
and
similar
expressions
are
intended
to
identify
forward-looking
statements
but
are
not
the
exclusive
means
of
identifying
such
statements.
Readers
are
cautioned
not
to
place
undue
reliance
on
these
forward-looking
statements
and
all
such
forward-looking
statements
are
qualified
in
their
entirety
by
reference
to
the
following
cautionary
statements.
Forward-looking
statements
are
based
on
the
company’s
current
expectations,
estimates
and
assumptions
and
because
forward-looking
statements
address
future
results,
events
and
conditions,
they,
by
their
very
nature,
involve
inherent
risks
and
uncertainties,
many
of
which
are
unforeseeable
and
beyond
the
company’s
control.
Such
known
and
unknown
risks,
uncertainties
and
other
factors
may
cause
actual
results,
performance
or
other
achievements
to
differ
materially
from
the
anticipated
results,
performance
or
achievements
expressed,
projected
or
implied
by
these
forward-looking
statements.
These
factors,
some
of
which
are
discussed
under
“Risk
Factors”
in
Section
3
of
the
Form
20-F
filed
with
the
Securities
and
Exchange
Commission
on
21
May
2015,
include,
but
are
not
limited
to:
all
matters
relating
to
or
arising
out
of
the
prior
manufacture
of
products
that
contained
asbestos
by
current
and
former
company
subsidiaries;
required
contributions
to
AICF,
any
shortfall
in
AICF
and
the
effect
of
currency
exchange
rate
movements
on
the
amount
recorded
in
the
company’s
financial
statements
as
an
asbestos
liability;
governmental
loan
facility
to
AICF;
compliance
with
and
changes
in
tax
laws
and
treatments;
competition
and
product
pricing
in
the
markets
in
which
the
company
operates;
the
consequences
of
product
failures
or
defects;
exposure
to
environmental,
asbestos,
putative
consumer
class
action
or
other
legal
proceedings;
general
economic
and
market
conditions;
the
supply
and
cost
of
raw
materials;
possible
increases
in
competition
and
the
potential
that
competitors
could
copy
the
company’s
products;
reliance
on
a
small
number
of
customers;
a
customer’s
inability
to
pay;
compliance
with
and
changes
in
environmental
and
health
and
safety
laws;
risks
of
conducting
business
internationally;
compliance
with
and
changes
in
laws
and
regulations;
the
effect
of
the
transfer
of
the
company’s
corporate
domicile
from
the
Netherlands
to
Ireland,
including
changes
in
corporate
governance
and
any
potential
tax
benefits
related
thereto;
currency
exchange
risks;
dependence
on
customer
preference
and
the
concentration
of
the
company’s
customer
base
on
large
format
retail
customers,
distributors
and
dealers;
dependence
on
residential
and
commercial
construction
markets;
the
effect
of
adverse
changes
in
climate
or
weather
patterns;
possible
inability
to
renew
credit
facilities
on
terms
favorable
to
the
company,
or
at
all;
acquisition
or
sale
of
businesses
and
business
segments;
changes
in
the
company’s
key
management
personnel;
inherent
limitations
on
internal
controls;
use
of
accounting
estimates;
and
all
other
risks
identified
in
the
company’s
reports
filed
with
Australian,
Irish
and
US
securities
regulatory
agencies
and
exchanges
(as
appropriate).
The
company
cautions
you
that
the
foregoing
list
of
factors
is
not
exhaustive
and
that
other
risks
and
uncertainties
may
cause
actual
results
to
differ
materially
from
those
referenced
in
the
company’s
forward-looking
statements.
Forward-looking
statements
speak
only
as
of
the
date
they
are
made
and
are
statements
of
the
company’s
current
expectations
concerning
future
results,
events
and
conditions.
The
company
assumes
no
obligation
to
update
any
forward-looking
statements
or
information
except
as
required
by
law.
3


PAGE
Annual General Meeting
14 August 2015
Chairman’s
Address
Michael
Hammes
4


PAGE
Annual General Meeting
14 August 2015
CEO’s
Presentation
Louis
Gries
5


PAGE
GROUP OVERVIEW
6
Q1'16
Q1'15
Change
Adjusted EBIT (US$ millions)
89.7
71.2
26%
Adjusted EBIT Margin %
20.9%
17.1%
3.8 pts
Adjusted Net Operating Profit (US$ millions)
63.5
50.1
27%
Net operating cash flow (US$ million)
55.1
42.5
30%
Adjusted Diluted EPS (US cents)
14
11
27%
Three Months Ended 30 June


PAGE
USA
AND
EUROPE
FIBER
CEMENT
1
st
QUARTER
SUMMARY
7
Higher
volume
driven
by
modest
market
growth
Higher
average
net
sales
price
reflects
our
annual
price
increase
effective
1
March
2015,
partially
offset
by
the
impact
of
foreign
exchange
and
mix
Favorable
production
costs
driven
primarily
by
continued
performance
improvements
across
our
network
of
plants,
as
well
as
lower
freight
costs
and
input
costs
for
pulp
and
utilities
1
st
Quarter
Results
Net Sales
Up
5% to US$337.0 million
Sales Volume
Up
4% to 480.0 mmsf
Average Price
Up
1% to US$686 per msf
EBIT
Up
32% to US$89.5 million
EBIT Margin
Up
540 bps to 26.6%


PAGE
8
Favorable conditions in addressable markets
Higher volume and sales in AUS, NZ, and Philippines
Higher average net sales price driven by favorable product mix and price increases
Higher production costs primarily driven by the impact of the depreciating Australian dollar on the US dollar
price of pulp and higher plant performance driven by the start up of our Carole Park sheet machine
EBIT results in US Dollars were impacted by a 17% unfavorable change in the weighted average period
AUD/USD exchange rate relative to the prior corresponding quarter
1
st
Quarter
Results
Net Sales
Up
15% to A$117.4 million
Sales Volume
Up
10% to 119.1 mmsf
Average Price
Up
5% to A$975 per msf
US$ EBIT
1
Down
5% to US$19.7 million
A$ EBIT
1
Up
15%
to A$25.4 million
US$ EBIT Margin
1
Down
10 bps
to
21.6%
ASIA PACIFIC FIBER CEMENT 1st  QUARTER SUMMARY
1
Excludes New Zealand weathertightness claims


PAGE
Management notes the range of analysts’ forecasts for net operating profit excluding asbestos for the
year ending 31 March 2016 is between US$244 million and US$286 million
Management expects full year Adjusted net operating profit to be between US$240 million and US$270
million
assuming, among other things, housing conditions in the United States continuing to improve in
line with our assumed forecasted new construction starts, input prices and production efficiencies
remaining consistent and an average exchange rate at or near current levels is applicable for the
remainder of the year
Management cautions that although US housing activity has been improving, market conditions remain
somewhat uncertain and some input costs remain volatile
Management is unable to forecast the comparable US GAAP financial measure due to uncertainty
regarding the impact of actuarial estimates on asbestos-related assets and liabilities in future periods
FY2016 GUIDANCE
9


PAGE
Annual General Meeting
14 August 2015
Items of Business*
10
*Shareholders should refer to the 2015 Notice of Annual General Meeting for the full text and background to each resolution set forth in the presentation


PAGE
RESOLUTION 1:
Financial Statements and Reports for Fiscal
Year 2015
To receive and consider the financial statements and the
reports of the Board and external auditor for the fiscal
year ended 31 March 2015
11


PAGE
RESOLUTION 1:
Financial Statements and Reports for Fiscal
Year 2015
12
PROXY RESULTS:
Votes
%*
For
365,611,073
99.97
Against
30,139
0.01
Open
74,945
0.02
Abstain
2,112,605
N/A
Excluded
0
N/A
* Percentages have been rounded


PAGE
RESOLUTION 2:
Remuneration Report for Fiscal Year 2015
To receive and consider the Remuneration Report of the
Company for the fiscal year ended 31 March 2015
13


PAGE
RESOLUTION 2:
Remuneration Report for Fiscal Year 2015
14
PROXY RESULTS:
Votes
%*
For
316,331,083
86.37
Against
49,869,849
13.61
Open
74,945
0.02
Abstain
1,552,885
N/A
Excluded
0
N/A
* Percentages have been rounded


PAGE
RESOLUTION 3:
Election/Re-election of Directors
a.
That Andrea Gisle Joosen be elected as a director
b.
That Brian Anderson, who retires by rotation in accordance
with the Articles of Association, be re-elected as a director
c.
That Alison Littley, who retires by rotation in accordance with
the Articles of Association, be re-elected as a director
d.
That James Osborne, who retires by rotation in accordance
with the Articles of Association, be re-elected as a director
15


PAGE
RESOLUTION 3(a):
Election
of
Director
Andrea
Gisle
Joosen
16
PROXY RESULTS:
Votes
%*
For
367,196,036
99.94
Against
146,472
0.04
Open
74,945
0.02
Abstain
411,309
N/A
Excluded
0
N/A
* Percentages have been rounded


PAGE
RESOLUTION 3(b):
Re-election
of
Director
Brian
Anderson
17
PROXY RESULTS:
Votes
%*
For
362,187,124
98.90
Against
3,948,439
1.08
Open
72,445
0.02
Abstain
1,620,754
N/A
Excluded
0
N/A
* Percentages have been rounded


PAGE
RESOLUTION 3(c):
Re-election
of
Director
Alison
Littley
18
PROXY RESULTS:
Votes
%*
For
364,858,380
99.30
Against
2,490,637
0.68
Open
74,945
0.02
Abstain
404,800
N/A
Excluded
0
N/A
* Percentages have been rounded


PAGE
RESOLUTION 3(d):
Re-election
of
Director
James
Osborne
19
PROXY RESULTS:
Votes
%*
For
367,248,977
99.95
Against
98,318
0.03
Open
72,445
0.02
Abstain
409,022
N/A
Excluded
0
N/A
* Percentages have been rounded


PAGE
RESOLUTION 4:
Authority to Fix the External Auditor’s
Remuneration
That the Board be authorised to fix the remuneration of
the external auditor for the fiscal year ended 31 March
2016
20


PAGE
RESOLUTION 4:
Authority to Fix the External Auditor’s
Remuneration
21
PROXY RESULTS:
Votes
%*
For
367,239,915
99.95
Against
124,484
0.03
Open
74,945
0.02
Abstain
389,080
N/A
Excluded
0
N/A
* Percentages have been rounded


PAGE
RESOLUTION 5:
Re-approval of the James Hardie Industries
Long Term Incentive Plan 2006
That approval is given for all purposes for further
amendment to, and continued operation of, the James
Hardie Industries Long Term Incentive Plan 2006 (as
amended)
22


PAGE
RESOLUTION 5:
Re-approval of the James Hardie Industries
Long Term Incentive Plan 2006
23
PROXY RESULTS:
Votes
%*
For
296,517,107
82.15
Against
64,341,200
17.83
Open
70,291
0.02
Abstain
6,377,886
N/A
Excluded
522,278
N/A
* Percentages have been rounded


PAGE
RESOLUTION 6:
Grant of Return on Capital Employed
Restricted Stock Units
Approve the grant of Return on Capital Employed
Restricted Stock Units (RSUs) under the Company’s
2006 Long Term Incentive Plan (as amended) to the
CEO, Louis Gries
24


PAGE
RESOLUTION 6:
Grant of Return on Capital Employed
Restricted Stock Units
25
PROXY RESULTS:
Votes
%*
For
322,438,703
88.16
Against
43,202,226
11.82
Open
70,291
0.02
Abstain
1,595,264
N/A
Excluded
522,278
N/A
* Percentages have been rounded


PAGE
RESOLUTION 7:
Grant of Relative Total Shareholder Return
(TSR) RSUs
Approve the grant of RSUs with a Relative Total
Shareholder Return (TSR) hurdle under the Company’s
2006 Long Term Incentive Plan (as amended) to the
CEO, Louis Gries
26


PAGE
RESOLUTION 7:
Grant of Relative Total Shareholder Return
(TSR) RSUs
27
PROXY RESULTS:
Votes
%*
For
295,288,992
80.74
Against
70,356,714
19.24
Open
70,291
0.02
Abstain
1,590,487
N/A
Excluded
522,278
N/A
* Percentages have been rounded


PAGE
SPECIAL RESOLUTION 8:
Amend the Memorandum of Association
That clauses, 2, 3(i)(d) and 3 (ix) of the Memorandum of
Association, in the form produced to the meeting and
initialled by the Chairman for the purposes of
identification, be adopted in substitution for, and to the
exclusion of, the existing clauses, 2, 3(i)(d) and 3 (ix)
and that the form of the Memorandum of Association be
made consistent with the Irish Companies Act 2014, on
the basis set out in the Explanatory Notes
28


PAGE
SPECIAL RESOLUTIONS 8:
Amend the Memorandum of Association
29
PROXY RESULTS:
Votes
%*
For
365,250,513
99.41
Against
2,078,690
0.57
Open
72,791
0.02
Abstain
426,768
N/A
Excluded
0
N/A
* Percentages have been rounded


PAGE
SPECIAL RESOLUTIONS 9:
Amend the Articles of Association
That the Articles of Association, in the form produced to
the meeting and initialled by the Chairman for the
purposes of identification, be adopted in substitution for,
and to the exclusion of, the existing Articles of
Association of the Company and on the basis set out in
the Explanatory Notes
30


PAGE
SPECIAL RESOLUTIONS 9:
Amend the Articles of Association
31
PROXY RESULTS:
Votes
%*
For
365,245,144
99.41
Against
2,089,142
0.57
Open
72,791
0.02
Abstain
421,685
N/A
Excluded
0
N/A
* Percentages have been rounded


PAGE
Other Items of Business
32


Annual General Meeting
14 August 2015

Exhibit 99.7

 

LOGO

Address to the 2015 Annual General Meeting

Michael Hammes, Chairman, James Hardie Industries plc

Hello and welcome to James Hardie Industries plc’s 2015 Annual General Meeting (AGM), our sixth AGM to be held in Dublin. I am pleased to have you join us.

James Hardie delivered strong results in fiscal year 2015 under the leadership of the management team and through the commitment of all employees. With our focus on growing market demand, continued commitment to expanding our manufacturing capacity and overall enhancement of our organisational capabilities, we believe we are well positioned to take advantage of the expected strengthening of the US housing market and to continue to deliver growth and superior returns over the long-term.

In the US the higher sales volumes were driven by market share gains and the continued modest recovery in the underlying US housing market. The business also benefitted from a higher average sales price, a vigilant focus on costs and improved performance in our plants.

Our Asia Pacific businesses once again contributed solid results. In Australia, net sales improved, in line with the growth in the detached housing market and the positive momentum in the repair and remodel market.

Our New Zealand business delivered improved results supported by a strong local housing market, particularly in Auckland and Christchurch. However, the rate of growth slowed in comparison to the prior fiscal year. Our Philippines business continued to grow, driven by increased penetration into the growing residential high rise market and the strengthening commercial market.

I would now like to address the issue of capital management. Our strong operating performance and confidence in the operating environments enabled the Board to declare a first half ordinary dividend of US8.0 cents and a second half ordinary dividend of US27.0 cents, as well as, a special dividend of US22.0 cents per security in May 2015. The ordinary dividend reflects our commitment to provide shareholder returns within the ordinary dividend payout ratio of 50 to 70% of net operating profit, excluding asbestos adjustments.

We continue to invest in additional manufacturing capacity across our US and Asia Pacific networks, including capacity expansion projects at our Plant City, Cleburne and Carole Park locations. During fiscal year 2015 we spent US$173.1 million on these capacity expansion projects. We have also spent a combined US$65.8 million on the strategic purchases of our previously leased Rosehill site in New South Wales, and a parcel of land near our Tacoma plant in Washington, securing our manufacturing footprints in both locations for the long term.

Additionally on 1 July 2015, James Hardie contributed US$62.8 million (A$81.1million) to the Asbestos Injuries Compensation Fund (AICF). This amount represents 35% of our free cash flow for fiscal year 2015 which we are obliged to contribute as part of our commitment under the Amended and Restated Final Funding Agreement.

Including this contribution James Hardie has provided over A$1.1 billion towards asbestos compensation since 2001.

 

LOGO


LOGO

 

On 27 February 2015, the AICF confirmed that the NSW government had agreed to amend the terms of the Loan Facility provided to AICF Limited by the NSW Government. As a consequence of the amendments, it is expected that the AICF will continue to pay claims in full, as they fall due. James Hardie acknowledges the efforts of the parties in reaching an outcome to this matter which we consider addresses the interests of all stakeholders.

Now turning our attention to board appointments and renewal. I would like to take this opportunity to welcome Andrea Gisle Joosen. We announced the appointment of Andrea to our Board in March 2015 and she stands for election at this AGM. Andrea is a member of the Audit Committee and is an experienced former executive with extensive experience in marketing, brand management and business development across a range of different consumer businesses.

Brian Anderson will be standing for re-election at today’s meeting. Brian was initially appointed as an independent non-executive director in December 2006 and is Chairman of the Audit Committee and a member of the Remuneration Committee. Brian has extensive financial and business experience at both executive and board levels.

Alison Littley will be standing for re-election at today’s meeting. Alison was initially appointed as an independent non-executive director in February 2012 and is a member the Audit Committee and the Remuneration Committee. Alison has substantial experience in multinational manufacturing and supply chain operations, and she brings a strong international leadership background building effective management teams and third party relationships.

James Osborne will be standing for re-election at today’s meeting. James was initially appointed as an independent non-executive director in March 2009 and is a member the Nominating and Governance Committee. James is an experienced company director with a strong legal background and a considerable knowledge of international business operations in North America and Europe.

In conclusion, under the leadership of the management team, the company has delivered strong operating earnings during fiscal year 2015, allowing us to achieve our highest ever revenue result. We remain well positioned to take advantage of the anticipated improvement in our key product segments and markets.

END

 

LOGO


LOGO

 

Forward-Looking Statements

This Chairman’s Address contains forward-looking statements. James Hardie Industries plc (the “company”) may from time to time make forward-looking statements in its periodic reports filed with or furnished to the Securities and Exchange Commission, on Forms 20-F and 6-K, in its annual reports to shareholders, in offering circulars, invitation memoranda and prospectuses, in media releases and other written materials and in oral statements made by the company’s officers, directors or employees to analysts, institutional investors, existing and potential lenders, representatives of the media and others. Statements that are not historical facts are forward-looking statements and such forward-looking statements are statements made pursuant to the Safe Harbor Provisions of the Private Securities Litigation Reform Act of 1995.

Examples of forward-looking statements include:

 

 

 

statements about the company’s future performance;

 

 

 

projections of the company’s results of operations or financial condition;

 

 

 

statements regarding the company’s plans, objectives or goals, including those relating to strategies, initiatives, competition, acquisitions, dispositions and/or its products;

 

 

 

expectations concerning the costs associated with the suspension or closure of operations at any of the company’s plants and future plans with respect to any such plants;

 

 

 

expectations concerning the costs associated with the significant capital expenditure projects at any of the company’s plants and future plans with respect to any such projects;

 

 

 

expectations regarding the extension or renewal of the company’s credit facilities including changes to terms, covenants or ratios;

 

 

 

expectations concerning dividend payments and share buy-backs;

 

 

 

statements concerning the company’s corporate and tax domiciles and structures and potential changes to them, including potential tax charges;

 

 

 

statements regarding tax liabilities and related audits, reviews and proceedings;

 

 

 

expectations about the timing and amount of contributions to Asbestos Injuries Compensation Fund (AICF), a special purpose fund for the compensation of proven Australian asbestos-related personal injury and death claims;

 

 

 

expectations concerning indemnification obligations;

 

 

 

expectations concerning the adequacy of the company’s warranty provisions and estimates for future warranty-related costs;

 

 

 

statements regarding the company’s ability to manage legal and regulatory matters (including but not limited to product liability, environmental, intellectual property and competition law matters) and to resolve any such pending legal and regulatory matters within current estimates and in anticipation of certain third-party recoveries; and

 

 

 

statements about economic conditions, such as changes in the US economic or housing recovery or changes in the market conditions in the Asia Pacific region, the levels of new home construction and home renovations, unemployment levels, changes in consumer income, changes or stability in housing values, the availability of mortgages and other financing, mortgage and other interest rates, housing affordability and supply, the levels of foreclosures and home resales, currency exchange rates, and builder and consumer confidence.

Words such as “believe,” “anticipate,” “plan,” “expect,” “intend,” “target,” “estimate,” “project,” “predict,” “forecast,” “guideline,” “aim,” “will,” “should,” “likely,” “continue,” “may,” “objective,” “outlook” and similar expressions are intended to identify forward-looking statements but are not the exclusive means of identifying such statements. Readers are cautioned not to place undue reliance on these forward-looking statements and all such forward-looking statements are qualified in their entirety by reference to the following cautionary statements.

Forward-looking statements are based on the company’s current expectations, estimates and assumptions and because forward-looking statements address future results, events and conditions, they, by their very nature, involve inherent risks and uncertainties, many of which are unforeseeable and beyond the company’s control. Such known and unknown risks, uncertainties and other factors may cause actual results, performance or other achievements to differ materially from the anticipated results, performance or achievements expressed, projected or implied by these forward-looking statements. These factors, some of which are discussed under “Risk Factors” in Section 3 of the Form 20-F filed with the Securities and Exchange Commission on 21 May 2015, include, but are not limited to: all matters relating to or arising out of the prior manufacture of products that contained asbestos by current and former company subsidiaries; required contributions to AICF, any shortfall in AICF and the effect of currency exchange rate movements on the amount recorded in the company’s financial statements as an asbestos liability; governmental loan facility to AICF; compliance with and changes in tax laws and treatments; competition and product pricing in the markets in which the company operates; the consequences of product failures or defects; exposure to environmental, asbestos, putative consumer class action or other legal proceedings; general economic and market conditions; the supply and cost of raw materials; possible increases in competition and the potential that competitors could copy the company’s products; reliance on a small number of customers; a customer’s inability to pay; compliance with and changes in environmental and health and safety laws; risks of conducting business internationally; compliance with and changes in laws and regulations; the effect of the transfer of the company’s corporate domicile from the Netherlands to Ireland, including changes in corporate governance and any potential tax benefits related thereto; currency exchange risks; dependence on customer preference and the concentration of the company’s customer base on large format retail customers, distributors and dealers; dependence on residential and commercial construction markets; the effect of adverse changes in climate or weather patterns; possible inability to renew credit facilities on terms favorable to the company, or at all; acquisition or sale of businesses and business segments; changes in the company’s key management personnel; inherent limitations on internal controls; use of accounting estimates; and all other risks identified in the company’s reports filed with Australian, Irish and US securities regulatory agencies and exchanges (as appropriate). The company cautions you that the foregoing list of factors is not exhaustive and that other risks and uncertainties may cause actual results to differ materially from those referenced in the company’s forward-looking statements. Forward-looking statements speak only as of the date they are made and are statements of the company’s current expectations concerning future results, events and conditions. The company assumes no obligation to update any forward-looking statements or information except as required by law.

 

LOGO

Exhibit 99.8

 

LOGO

 

   

James Hardie Industries plc

Europa House 2nd Floor,

Harcourt Centre

Harcourt Street, Dublin 2, Ireland

 

T: +353 (0) 1 411 6924

F: +353 (0) 1 479 1128

14 August 2015

The Manager

Company Announcements Office

Australian Securities Exchange Limited

20 Bridge Street

SYDNEY NSW 2000

Dear Sir

Results of 2015 Annual General Meeting

We advise that all resolutions set out in the Notice of the Annual General Meeting dated 13 July 2015, were carried at the Annual General Meeting of the company today in Dublin, Ireland.

Details of votes cast are set out below:

 

    

RESOLUTION

   FOR      AGAINST      ABSTAIN  

1

   Financial Statements and Reports      365,686,018         30,139         2,112,605   

2

   Remuneration Report      316,406,028         49,869,849         1,552,885   

3(a)

   A Gisle Joosen election      367,270,981         146,472         411,309   

3(b)

   B Anderson re-election      362,259,569         3,948,439         1,620,754   

3(c)

   A Littley re-election      364,933,325         2,490,637         404,800   

3(d)

   J Osborne re-election      367,321,422         98,318         409,022   

4

   Fix external auditor remuneration      367,314,860         124,484         389,080   

5

   Re-approve Long Term Incentive Plan 2006      296,587,398         64,341,200         6,377,886   

6

   Grant ROCE RSUs to L Gries      322,508,994         43,202,226         1,595,264   

7

   Grant Relative TSR RSUs to L Gries      295,359,283         70,356,714         1,590,487   

8

   Amend Memorandum of Association      365,323,304         2,078,690         426,768   

9

   Amend Articles of Association      365,317,935         2,089,142         421,685   

We also enclose a copy of amended Memorandum and Articles of Association of James Hardie Industries plc, in compliance with Listing Rule 15.4.2.

Yours faithfully

 

LOGO

Natasha Mercer

Company Secretary

James Hardie Industries plc is a limited liability company incorporated in Ireland with its registered office at

Europa House, Harcourt Centre, Harcourt Street, Dublin 2, Ireland.

Directors: Michael Hammes (Chairman, USA), Brian Anderson (USA), Russell Chenu (Australia),

Andrea Gisle Joosen (Sweden), David Harrison (USA), Alison Littley (United Kingdom), Donald McGauchie (Australia),

James Osborne, Rudy van der Meer (Netherlands).

Chief Executive Officer and Director: Louis Gries (USA)

Company number : 485719

Exhibit 99.9

Cert. No.     

Companies Act 2014

 

 

 

A PUBLIC LIMITED COMPANY

 

 

CONSTITUTION

-of-

JAMES HARDIE INDUSTRIES PUBLIC

LIMITED COMPANY

MEMORANDUM OF ASSOCIATION

(as amended by all resolutions passed up to and including 14 August 2015)

 

1.

The name of the company is James Hardie Industries public limited company.

 

2.

The company is a public limited company deemed to be a PLC to which Part 17 of the Companies Act 2014 applies.

 

3.

The objects for which the company is established are:

 

(i)  

(a)        

  

to carry on the businesses of manufacturer, distributor, wholesaler, retailer, service provider, investor, designer, trader and any other business (except the issuing of policies of insurance) which may seem to the Company’s board of directors capable of being conveniently carried on in connection with these objects or calculated directly or indirectly to enhance the value of or render more profitable any of the Company’s property;

 

  (b)

to carry on the business of a holding company and to co-ordinate the administration, finances and activities of any subsidiary companies or associated companies, to do all lawful acts and things whatever that are necessary or convenient in carrying on the business of such a holding company and in particular to carry on in all its branches the business of a management services company, to act as managers and to direct or coordinate the management of other companies or of the business, property and estates of any company or person and to undertake and carry out all such services in connection therewith as may be deemed expedient by the Company’s board of directors and to exercise its powers as a shareholder of other companies;

 

  (c)

to borrow or raise or secure the payment of money (including money in a currency other than the currency of the State) in such manner as the Company shall think fit and in particular by the issue of shares, debentures, debenture stock, perpetual or otherwise, charged upon all or any of the Company’s property, both present and future, including its uncalled capital and to purchase, redeem or pay off any such securities;


  (d)

to guarantee, indemnify, grant indemnities in respect of, enter into any suretyship or joint obligation, or otherwise support or secure, whether by personal covenant, indemnity or undertaking or by mortgaging, charging, pledging or granting a lien or other security over all or any part of the Company’s property (both present and future) or by any one or more of such methods or any other method and whether in support of such guarantee or indemnity or suretyship or joint obligation or otherwise, on such terms and conditions as the Company’s board of directors shall think fit, the payment of any debts or the performance or discharge of any contract, obligation or liability of any person or company (including, without prejudice to the generality of the foregoing, the payment of any capital, principal, dividends or interest on any stocks, shares, debentures, debenture stock, notes, bonds or other securities of any person, authority or company) including, without prejudice to the generality of the foregoing, any body corporate which is the Company’s subsidiary as defined in the Companies Act 2014 and in any statutory modification or re-enactment thereof, or any other body corporate howsoever associated with the Company, in each case notwithstanding the fact that the Company may not receive any consideration, advantage or benefit, direct or indirect, from entering into any such guarantee or indemnity or suretyship or joint obligation or other arrangement or transaction contemplated herein.

 

  (ii)

To purchase, acquire, develop, re-claim, improve, cultivate and work lands and hereditaments of any estate or interest whatsoever, and any rights, privileges or easements over or in respect thereof and erect and build thereon factories, houses, offices and other buildings and to hold, occupy, lease, mortgage, sell or otherwise deal with the same.

 

  (iii)

To lay out land for building purposes, and to build on, improve, let on building leases, advance money to persons building on and otherwise develop the same.

 

  (iv)

To acquire, improve, manage, work, develop, exercise all rights in respect of, lease, mortgage, sell, dispose of, turn to account and otherwise deal with property of all kinds, and in particular lands, buildings, concessions and patents.

 

  (v)

To purchase, take on lease, or otherwise acquire, any mines, mining rights, and metalliferous land in Ireland or elsewhere, and any interest therein and to explore, work, exercise, develop and turn to account the same.

 

  (vi)

To carry on the businesses of a holding, investment, estate and trust company and to raise money on such terms and conditions as may be thought desirable, and invest the amount thereof in or upon or otherwise acquire and hold shares, stocks, debentures, debenture stocks, bonds mortgages, obligations and securities of any kind issued or guaranteed by any public or private company, corporation or undertaking of whatever nature wherever situated or carrying on business, and shares, stocks, debentures, debenture stocks, bonds, obligations and other securities of Ireland or any other government or authority supreme, municipal, local or otherwise in any part of the world.


  (vii)

To perform any duty or duties imposed on the Company by or under any enactment and, to exercise any power conferred on the Company by or under any enactment.

 

  (viii)

To carry on all or any of the businesses aforesaid either as a separate business or as the principal business of the Company, and to carry on any other business (whether manufacturing or otherwise) which may seem to the Company capable of being conveniently carried on in connection with the above objects or calculated directly or indirectly to enhance the value of or render more profitable any of the company’s property.

 

  (ix)

To incorporate or cause to be incorporated any one or more subsidiaries of the Company (within the meaning of the Companies Act 2014) for the purpose of carrying on any business.

 

  (x)

To acquire and undertake the whole or any part of the business, property and liabilities of any person or company carrying on any business which the Company is authorised to carry on.

 

  (xi)

To apply for, purchase or otherwise acquire any patents, trade marks, brevets d’invention, licences, concessions and the like conferring any rights of any sort to use or any secret or other information as to any invention which may seem capable of being used for any of the purposes of the Company or the acquisition of which may seem calculated directly or indirectly to benefit the Company, and to use, exercise, develop or grant licences in respect of or otherwise turn to account the property rights or information so acquired.

 

  (xii)

To enter into partnership or into any arrangement for sharing profits, union of interests, co-operation, joint venture, reciprocal concession or otherwise with any person or company carrying on or engaged in or about to carry on or engage in any business or transaction which the Company is authorised to carry on or engage in or any business or transaction capable of being conducted so as directly or indirectly to benefit the Company.

 

  (xiii)

To purchase or otherwise acquire shares and securities of the Company or any company and to sell, hold, re-issue or otherwise deal with the same.

 

  (xiv)

To enter into any arrangements with any Governments or authorities, supreme, municipal, local or otherwise, that may seem conducive to the Company’s objects or any of them and to obtain from any such Government or authority any rights, privileges and concessions which the Company may think it desirable to obtain and to carry out, exercise and comply with any such arrangements, rights, privileges and concessions.


  (xv)

To establish and support or aid in the establishment and support of associations, institutions, funds, trusts and conveniences calculated to benefit directors and ex-directors, employees or ex-employees of the Company or the dependents or connections of such persons and (without prejudice to the generality of the foregoing) to grant gratuities, pensions or allowances on retirement or death to or in respect of any such persons and including the establishment of director and employee equity schemes and share option schemes, enabling directors and employees of the Company or other persons aforesaid to become shareholders in the Company, or otherwise to participate in the profits of the Company upon such terms and in such manner as the Company thinks fit, and to make payments towards insurance and to subscribe or guarantee money for charitable or benevolent objects or for any exhibition or for any public, general or useful object, or any other object whatsoever which the Company may think advisable.

 

  (xvi)

To establish and contribute to any scheme for the acquisition of shares in the Company for the benefit of the Company’s employees and to lend or otherwise provide money for such schemes or the Company’s employees or the employees of any of its subsidiary or associated bodies corporate to enable them to purchase shares or interests in shares of the Company.

 

  (xvii)

To establish any scheme or otherwise to provide for the purchase by or on behalf of customers of the Company of shares in the Company.

 

  (xviii)

To promote any company or companies for the purpose of acquiring all or any of the assets and liabilities of the Company or for any other purpose which may seem directly or indirectly calculated to benefit the Company.

 

  (xix)

Generally to purchase, take on lease or in exchange, hire or otherwise acquire any real and personal property and any rights or privileges which the Company may think necessary or convenient for the purposes of its business.

 

  (xx)

To develop and turn to account any land acquired by the Company or in which it is interested and in particular by laying out and preparing the same for building purposes, constructing, altering, pulling down, decorating, maintaining, fitting up and improving buildings and conveniences, letting on building leases or building agreement and by advancing money to and entering into contracts and arrangements of all kinds with builders, tenants and others.

 

  (xxi)

To construct, maintain and alter any building or works necessary or convenient for any of the purposes of the Company.

 

  (xxii)

To invest and deal with the monies of the Company not immediately required in such manner as may from time to time be determined.

 

  (xxiii)

To lend and advance money or give credit to such persons or companies whether with or without security and on such terms as may seem expedient, and in particular to customers and others having dealings with the Company; and to give guarantees or become security for any liabilities or obligations (present or future) of any persons or companies and generally to give any guarantees, indemnities and security on such terms and conditions as the Company may think fit.


  (xxiv)

To engage in currency exchange, interest rate and/or commodity or index linked transactions (whether in connection with or incidental to any other contract, undertaking or business entered into or carried on by the Company or whether as an independent object or activity) including, but not limited to, dealings in foreign currency, spot and forward rate exchange contracts, futures, options, forward rate agreements, swaps, caps, floors, collars, commodity or index linked swaps and any other foreign exchange, interest rate or commodity or index linked arrangements and such other instruments as are similar to or derive from any of the foregoing whether for the purpose of making a profit or avoiding a loss or managing a currency or interest rate exposure or any other purpose and to enter into any contract for and to exercise and enforce all rights and powers conferred by or incidental, directly or indirectly, to such transactions or termination of any such transactions.

 

  (xxv)

To remunerate any person or company for services rendered or to be rendered in placing or assisting to place or guaranteeing the placing of any of the shares of the Company’s capital or any debentures, debenture stock or other securities of the Company or in or about the formation or promotion of the Company or the conduct of its business.

 

  (xxvi)

To draw, make, accept, endorse, discount, execute and issue promissory notes, bills of exchange, bills of lading, warrants, debentures and other negotiable or transferable instruments.

 

  (xxvii)

To undertake and execute any trusts of all and every nature (and without prejudice to the generality of the foregoing, whether commercial, charitable, political or social) the undertaking whereof may seem desirable and either gratuitously or otherwise.

 

  (xxviii)

To sell or dispose of the undertaking of the Company or any part thereof for such consideration as the Company may think fit, and including for shares, debentures or securities of any other company having objects altogether or in part similar to those of the Company.

 

  (xxix)

To adopt such means of making known the products and services of the Company as may seem expedient.

 

  (xxx)

To obtain any enactment for enabling the Company to carry any of its objects into effect or for effecting any modification of the Company’s constitution or for any other purpose which may seem expedient and to oppose any proceedings or applications which may seem calculated directly or indirectly to prejudice the Company’s interests.

 

  (xxxi)

To procure the Company to be listed, registered or recognised in any country or place.


  (xxxii)

To sell, improve, manage, develop, exchange, lease, mortgage, enfranchise, dispose of, turn to account or otherwise deal with all or any of the property and rights of the Company.

 

  (xxxiii)

To promote freedom of contract, and to resist, insure against, counteract and discourage interference therewith, to join any lawful federation, union or association or do any other lawful act or thing with a view to preventing or resisting directly or indirectly any interruption of or interference with the Company’s or any other trade or business or providing or safeguarding against the same, or resisting or opposing any strike, movement or organisation, which may be thought detrimental to the interests of the Company or its employees and to subscribe to any association or fund for any such purposes.

 

  (xxxiv)

To grant bonuses to any person or persons who are or have been in the employment of the Company.

 

  (xxxv)

To grant, convey, transfer or otherwise dispose of any property or asset of the Company of whatever nature or tenure for such price, consideration, sum or other return whether equal to or less than the market value thereof and whether by way of gift or otherwise as the Directors shall deem fit and to grant any fee farm grant or lease or to enter into any agreement for letting or hire of any such property or assets for a rent or return equal to or less than the market or rack rent therefor or at no rent and subject to or free from covenants and restrictions as the Directors shall deem appropriate.

 

  (xxxvi)

To do all or any of the above things in any part of the world and as principals, agents, contractors, trustees or otherwise and by or through trustees, agents or otherwise and either alone or in conjunction with others.

 

  (xxxvii)

To convert into a public limited-liability company subject to obtaining all necessary consents and approvals as required by law.

 

  (xxxviii)

To distribute any of the property of the Company in specie among the members.

 

  (xxxix)

To do anything which appears to the Company to be requisite, advantageous or incidental to, or which appears to the Company to facilitate, either directly or indirectly, the attainment of the above objects or any of them.

 

  NOTE:

It is hereby declared that the word “company” in this clause shall be deemed to include any partnership or other body of persons whether incorporated or not incorporated and whether domiciled in Ireland or elsewhere.

 

4.

The liability of the members is limited.

 

5.

The share capital of the Company is €1,180,000,000 divided into 2,000,000,000 shares of €0.59 each.


6.

The shares forming the capital, increased or reduced, may be increased or reduced and be divided into such classes and issued with any special rights, privileges and conditions or with such qualifications as regards preference, dividend, capital, voting or other special incidents, and be held upon such terms as may be attached to such shares or as may from time to time be provided by the original or any substituted or amended articles of association of the Company for the time being, but so that where shares are issued with any preferential or special rights, such rights shall not be alterable otherwise than pursuant to the provisions of the Company’s articles of association for the time being.


Cert. No.

Companies Act 2014

 

 

 

A PUBLIC LIMITED COMPANY

 

 

ARTICLES OF ASSOCIATION

of

JAMES HARDIE INDUSTRIES PUBLIC

LIMITED COMPANY

(as adopted by Special Resolution passed 14 August 2015)

 

PART I - PRELIMINARY

 

1.

Interpretation

 

  (a)

The provisions set out in these articles of association shall constitute the whole of the regulations applicable to the Company and (except for Sections 83 and 84 of the Act, which shall apply to the Company) no “optional provision” as defined by Section 1007(2) of the Act shall apply to the Company.

 

  (b)

In these Articles the following expressions shall have the following meanings:

 

Act   means the Companies Act 2014 and every statutory modification and re-enactment thereof for the time being in force;
Acts  

means the Act and all statutory instruments which are to be read as one with, or construed or read together as one with, the Act;

address   includes any number or address used for the purposes of communication by way of electronic mail or other electronic communication;
advanced electronic signature   has the meaning given to that expression in the Electronic Commerce Act, 2000;
ASX   ASX Limited or Australian Securities Exchange as appropriate;
these Articles  

these articles of association as from time to time and for the time being in force;


ASX Settlement Rules  

the operating rules of the settlement facility provided by ASX Settlement and Transfer Corporation Pty Ltd (ABN 49 008 504 532);

the Auditors  

the independent external auditors for the time being of the Company;

Business Day”  

has the meaning given in the Listing Rules;

Chairman  

means the person holding the office of Chairman of the board of Directors for the time being;

CHESS”  

means the Clearing House Electronic Sub-Register System and has the meaning given to CHESS in the ASX Settlement Rules;

Clear Days  

in relation to the period of a notice, that period excluding the day when the notice is given or deemed to be given and the day for which it is given or on which it is to take effect;

Company  

means James Hardie Industries public limited company;

CUFS  

stands for CHESS Units of Foreign Securities and has the meaning given to CUFS in the ASX Settlement Rules;

CUFS Holder  

a record owner of CUFS according to the terms and conditions of the ASX Settlement Rules;

the Directors  

the Directors for the time being of the Company or any of them acting as the board of Directors of the Company;

Dispose  

has the meaning given in the Listing Rules;

electronic communication  

has the meaning given to that word in the Electronic Commerce Act, 2000;

electronic signature  

has the meaning given to that word in the Electronic Commerce Act, 2000;

the Group  

the Company and its subsidiaries from time to time and for the time being;

the Holder  

in relation to any share, the member whose name is entered in the Register as the holder of the share or, where the context permits, the members whose names are entered in the Register as the joint holders of shares;


Holding Lock  

has the meaning given in the Listing Rules;

Issuer Sponsored Sub-register  

has the meaning given in the Listing Rules;

the Listing Rules  

means the listing rules of ASX and any other rules of ASX which are applicable to the Company while the Company is Officially Listed, each as amended or replaced from time to time, except to the extent of any express written waiver by ASX;

Marketable Parcel  

has the meaning given in the Listing Rules;

Non-marketable Parcel  

has the meaning given in the Listing Rules;

the NYSE  

the New York Stock Exchange;

“Officially Listed  

means admitted to the official list of ASX;

Proper ASTC Transfer”   has the meaning given in the Australian Corporations Regulations 2001 ;
qualified certificate  

has the meaning given to that word in the Electronic Commerce Act, 2000;

Record Date”  

has the meaning given in the Listing Rules;

the Register  

the register of members to be kept as required by the Acts;

Restricted Securities  

has the meaning given in the Listing Rules;

the Seal  

the common seal of the Company or (where relevant) the official securities seal kept by the Company pursuant to the Acts;

Securities  

has the meaning given in the Listing Rules;

Security Holder  

has the meaning given in the Listing Rules;

the Secretary  

the Secretary of the Company and any person appointed to perform the duties of the Secretary of the Company;


the State  

Ireland exclusive of Northern Ireland;

treasury shares  

shares in the Company which have been redeemed or purchased by the Company, as are being held by the Company, as treasury shares in accordance with the Acts;

Voting Exclusion Statement  

has the meaning given in the Listing Rules;

warrants to subscribe  

a warrant or certificate or similar document indicating the right of the registered holder thereof (other than under a Director and employee equity or share option scheme for employees) to subscribe for shares in the Company.

 

  (c)

Expressions in these Articles referring to writing shall be construed, unless the contrary intention appears, as including references to printing, lithography, photography and any other modes or representing or reproducing words in a visible form except as provided in these Articles and/or where it constitutes writing in electronic form sent to the Company, the Company has agreed to its receipt in such form. Expressions in these Articles referring to execution of any document shall include any mode of execution whether under seal or under hand or any mode of electronic signature as shall be approved by the Directors. Expressions in these Articles referring to receipt of any electronic communications shall, unless the contrary intention appears, be limited to receipt in such manner as the Company has approved.

 

  (d)

Unless the contrary intention appears, the use of the word “address” in these Articles in relation to electronic communications includes any number or address used for the purpose of such communications.

 

  (e)

Unless specifically defined herein or the context otherwise requires, words or expressions contained in these Articles shall bear the same meaning as in the Acts but excluding any statutory modification thereof not in force when these Articles become binding on the Company.

 

  (f)

The headings and captions included in these Articles are inserted for convenience of reference only and shall not be considered a part of or affect the construction or interpretation of these Articles.

 

  (g)

References in these Articles to any enactment or any section or any regulation or provision thereof shall mean such enactment, section or provision as the same may be amended and may be from time to time and for the time being in force.


  (h)

In these Articles the masculine gender shall include the feminine and neuter, and vice versa, and the singular number shall include the plural, and vice versa, and words importing persons shall include firms or companies.

 

  (i)

References in these Articles to Euro or cent or € or c shall mean the currency for the time being of the State.

 

2.

Consistency with Listing Rules

 

  (a)

Subject only to the Acts and applicable law:

 

  (i)

despite anything contained in these Articles, if the Listing Rules prohibit an act being done, the act must not be done;

 

  (ii)

nothing contained in these Articles prevents an act being done that the Listing Rules require to be done; and

 

  (iii)

if the Listing Rules require an act to be done or not to be done, authority is given for that act to be done or not to be done as the case may be.

 

  (b)

Upon the Directors becoming aware that the Listing Rules:

 

  (i)

require these Articles to contain a provision which they do not contain; or

 

  (ii)

require these Articles not to contain a provision which they contain,

and being satisfied that any such requirement is permissible under the Acts and law, the Directors shall give notice at the next annual general meeting of a special resolution to alter these Articles so that the Articles will conform with the requirements of the Listing Rules.

 

  (c)

Upon the Directors becoming aware that any provision of these Articles is or will become inconsistent with the Listing Rules, the Directors shall give notice at the next annual general meeting of a special resolution to amend the relevant provision of these Articles to overcome the inconsistency (to the extent that the Directors are satisfied that any such amendment is permissible under the Acts and law).

 

  (d)

If there is a conflict between the Articles, the Listing Rules or the ASX Settlement Rules and the Acts and law, the Acts and law will prevail.

 

  (e)

Unless a contrary intention appears, an expression in these Articles which is defined by any provision of the Listing Rules or the ASX Settlement Rules has the same meaning as in that provision.

 

  (f)

If the Company has its Securities approved under the ASX Settlement Rules or operates an Issuer Sponsored Sub-register, it must comply with the Listing Rules and the ASX Settlement Rules including any requirements of an applicable sub-register system.


3.

Registered Office

The registered office of the Company shall be located in Dublin, Ireland as shall the Company’s head office, being the place where the Company shall be managed and controlled.

PART II - SHARE CAPITAL AND RIGHTS

 

4.

Share capital

The share capital of the Company is €1,180,000,000 divided into 2,000,000,000 shares of €0.59 each.

 

5.

Rights of shares on issue

Without prejudice to any special rights conferred on the Holders of any existing shares or class of shares and subject to the provisions of the Acts, any share may be issued with such rights or restrictions as the Company may by ordinary resolution determine.

 

6.

Redeemable shares, Preference Shares and Preference Securities

 

  (a)

If the Company agrees to acquire a share or a beneficial interest in a share, then by virtue of this Article 6(a) and unless the Company elects to treat the acquisition as a purchase, it shall be a term of such contract that:

 

  (i)

such share shall become redeemable by the Company and the holder of such share on, and from the time of, the existence or creation of such agreement, transaction or trade between the Company and any third party pursuant to which the Company acquires or will acquire shares or a beneficial interest in shares; and

 

  (ii)

the agreement between the Company and the third party shall constitute the exercise of the right of redemption.

In these circumstances, the acquisition of such shares by the Company shall constitute the redemption of a redeemable share in accordance with the Acts.

 

  (b)

Subject to the provisions of the Acts, any shares may be issued on the terms that they are, or at the option of the Company are, liable to be redeemed on such terms and in such manner as the Company may by special resolution determine. In addition and subject as aforesaid, the Company is hereby authorised to redeem (on such terms as may be contained in, or be determined pursuant to the provisions of, these Articles or a special resolution of the Company) any of its shares which have been converted into redeemable shares.

 

  (c)

The Company may cancel any shares so redeemed or may hold them as treasury shares and re-issue such treasury shares as shares of any class or classes or cancel them.

 

  (d)

If any of the Securities of the Company are preference shares or preference securities, the Company must comply with Listing Rules 6.3 to 6.7.


7.

Variation of rights

 

  (a)

Whenever the share capital is divided into different classes of shares, the rights attached to any class may be varied or abrogated with the consent in writing of the Holders of three-fourths in nominal value of the issued shares of that class, or with the sanction of a special resolution passed at a separate general meeting of the Holders of the shares of the class, and may be so varied or abrogated either whilst the Company is a going concern or during or in contemplation of a winding-up. The quorum at any such separate general meeting or at an adjourned meeting, shall be 5% of the issued share capital of the class in question.

 

  (b)

The rights conferred upon the Holders of the shares of any class issued with preferred or other rights shall not, unless otherwise expressly provided by these Articles or the terms of the issue of the shares of that class, be deemed to be varied by a purchase or redemption by the Company of its own shares or by the creation or issue of further shares ranking pari passu therewith or subordinate thereto.

 

8.

Trusts not recognised

Except as required by law, no person shall be recognised by the Company as holding any share upon any trust, and the Company shall not be bound by or be compelled in any way to recognise (even when having notice thereof) any equitable, contingent, future or partial interest in any share or any interest in any fractional part of a share or (except only as by these Articles or by law otherwise provide) any other rights in respect of any share except an absolute right to the entirety thereof in the Holder; this shall not preclude the Company from requiring the members or a transferee of shares to furnish the Company with information as to the beneficial ownership of any share when such information is reasonably required by the Company. In addition, unless required to do so by the ASX Settlement Rules or applicable law, the Company need not record on any register and is not required to recognise any equitable, contingent, future or partial interest in any of its CUFS or any other right in respect of any of its CUFS except an absolute right of legal ownership in the registered holder.

 

9.

Allotment of shares

 

  (a)

Subject to the provisions of the Acts relating to authority, pre-emption or otherwise in regard to the allotment, issue of, or the grant of options over, or other rights to subscribe for, new shares and of any resolution of the Company in general meeting passed pursuant thereto, all unissued shares (including treasury shares) for the time being in the capital of the Company shall be at the disposal of the Directors and (subject to the provisions of the Acts) they may allot, offer, grant options over or otherwise dispose of them to such persons (including any Director) on such terms and conditions and at such times as they may consider to be in the best interests of the Company, but so that no share shall be issued at a discount to their par value and so that, in the case of shares offered to the public for subscription, the amount payable on application on each share shall not be less than one-quarter of the nominal amount of the share and the whole of any premium thereon.


  (b)

Without prejudice to the generality of the powers conferred on the Directors by the other paragraphs of this Article, the Directors may grant from time to time options (or any other interest in the capital of the Company) to subscribe for the unallotted shares in the capital of the Company to persons providing services to, or in the service or employment of, the Company or any subsidiary or associated company of the Company (including Directors holding executive offices) on such terms and subject to such conditions as may be approved from time to time by the Directors or by any committee thereof appointed by the Directors for the purpose of such approval.

 

  (c)

The Directors are, for the purposes of the Acts generally and unconditionally authorised to exercise all powers of the Company to allot and issue relevant securities (as defined by Section 1021 of the Act) up to the amount of Company’s authorised share capital and to allot and issue any shares purchased by the Company pursuant to the provisions of the Acts and held as treasury shares and this authority shall expire five years from the date of adoption of these articles of association.

 

  (d)

Where the Directors are authorised to allot relevant securities in accordance with Section 1021 of the Act, the Company may at any time and from time to time by resolution of the Directors resolve to allot equity securities (as defined by Section 1023 the Act) for cash pursuant to their authority to allot relevant securities as if sub-section (1) of Section 1022 of the Act did not apply to any such allotment provided that this power shall be limited to:-

 

  (i)

the allotment of equity securities in connection with any rights issue in favour of ordinary shareholders (other than those holders with registered addresses outside Australia or the United States of America to whom an offer would, in the opinion of the Directors, be impractical or unlawful in any jurisdiction) and/or any persons having a right to subscribe for or convert securities into ordinary shares in the capital of the Company (including without limitation any holders of options under any of the Company’s director and employee equity or share option schemes for the time being) where the equity securities respectively attributable to the interests of such ordinary shareholders or such persons are proportionate (as nearly as may be) to the respective number of ordinary shares held by them or for which they are entitled to subscribe or convert into subject to such exclusions or other arrangements as the Directors may deem necessary or expedient to deal with any regulatory requirements, legal or practical problems in respect of overseas shareholders, fractional entitlements or otherwise;

 

  (ii)

the allotment of equity securities (other than pursuant to any such issue as referred to in paragraph (i) above) up to a maximum aggregate number which is equal to the amount of Company’s authorised share capital; and


  (iii)

such power shall continue for as long as the Directors are authorised to allot relevant securities in accordance with Section 1021 of the Act.

 

  (e)

The Directors shall, in allotting equity securities (as defined by the Listing Rules), comply with the provisions of the Listing Rules.

 

10.

Payment of commission

The Company may exercise the powers of paying commissions conferred by the Acts. Subject to the provisions of the Listing Rules and the Acts, any such commission may be satisfied by the payment of cash or by the allotment of fully or partly paid shares or partly in one way and partly in the other. On any issue of shares the Company may also pay such brokerage as may be lawful.

 

11.

Payment by instalments

If by the conditions of allotment of any share the whole or part of the amount or issue price thereof shall be payable by instalments, every such instalment when due shall be paid to the Company by the person who for the time being is the Holder of the share.

 

12.

Restricted Securities

If any Securities of the Company are classified as Restricted Securities under the Listing Rules:

 

  (a)

during the escrow period set by the restriction agreement required by ASX in relation to those Securities:

 

  (i)

the Security Holder who holds the Restricted Securities may not Dispose of them; and

 

  (ii)

the Company must not register a transfer of the Restricted Securities or otherwise acknowledge a disposal of them,

except as permitted by the Listing Rules or ASX; and

 

  (b)

if there is a breach of the Listing Rules or of the relevant restriction agreement in relation to a Restricted Security, then while the breach continues, the holding of that security does not entitle a Security Holder:

 

  (i)

to be present, speak or vote at, or be counted in the quorum for, a meeting of Security Holders; or

 

  (ii)

to receive any dividend or other distribution.


PART III - SHARE CERTIFICATES

 

13.

Issue of certificates

Except where the terms of issue provide otherwise, every member shall be entitled without payment to receive within two months after allotment or lodgement of a transfer to him of the shares in respect of which he is so registered (or within such other period as the conditions of issue shall provide) one certificate for all the shares of each class held by him or several certificates each for one or more of his shares upon payment for every certificate after the first of such reasonable sum as the Directors may determine provided that the Company shall not be bound to issue more than one certificate for shares held jointly by several persons and delivery of a certificate to one joint Holder shall be a sufficient delivery to all of them. The Company shall not be bound to register more than four persons as joint Holders of any share (except in the case of executors or trustees of a deceased member). Every certificate shall be sealed with the Seal and shall specify the number, class and distinguishing numbers (if any) of the shares to which it relates and the amount or respective amounts paid up thereon.

 

14.

Balance and exchange certificates

 

  (a)

Where some only of the shares comprised in a share certificate are transferred the old certificate shall be cancelled and the new certificate for the balance of such shares shall be issued in lieu without charge.

 

  (b)

Any two or more certificates representing shares of any one class held by any member at his request may be cancelled and a single new certificate for such shares issued in lieu, without charge unless the Directors otherwise determine. If any member shall surrender for cancellation a share certificate representing shares held by him and request the Company to issue in lieu two or more share certificates representing such shares in such proportions as he may specify, the Directors may comply, if they think fit, with such request.

 

15.

Replacement of certificates

If a share certificate is defaced, worn out, lost, stolen or destroyed, it may be replaced on such terms (if any) as to evidence and indemnity and payment of any exceptional expenses incurred by the Company in investigating evidence or in relation to any indemnity as the Directors may determine, but otherwise free of charge, and (in the case of defacement or wearing out) on delivery up of the old certificate.

PART IV - LIEN ON SHARES

 

16.

Extent of lien

The Company shall have a first and paramount lien on every share (not being a fully paid share) for:

 

  (a)

all due and unpaid calls and instalments in respect of that share; and

 

  (b)

all money which the Company is required by law to pay, and has paid, in respect of that share.

In each case, the lien extends to reasonable interest and expenses incurred because the amount is not paid.

The Directors, at any time, may declare any share to be wholly or in part exempt from the provisions of this Article. The Company’s lien on a share shall extend to all distributions in respect of that share, including dividends.


17.

Power of sale

The Company may sell in such manner as the Directors determine any share on which the Company has a lien if a sum in respect of which the lien exists is presently payable and is not paid within fourteen (14) Clear Days after notice demanding payment, and stating that if the notice is not complied with the share may be sold, has been given to the Holder of the share or to the person entitled to it by reason of the death or bankruptcy of the Holder.

 

18.

Power to effect transfer

To give effect to a sale, the Directors may authorise some person to execute an instrument of transfer of the share sold to, or in accordance with the directions of, the purchaser. The transferee shall be entered in the Register as the Holder of the share comprised in any such transfer and he shall not be bound to see to the application of the purchase moneys nor shall his title to the share be affected by any irregularity in or invalidity of the proceedings in reference to the sale, and after the name of the transferee has been entered in the Register, the remedy of any person aggrieved by the sale shall be in damages only and against the Company exclusively.

 

19.

Proceeds of sale

The net proceeds of the sale, after payment of the costs, shall be applied in payment of so much of the sum for which the lien exists as is presently payable and any residue (upon surrender to the Company for cancellation of the certificate for the shares sold and subject to a like lien for any moneys not presently payable as existed upon the shares before the sale) shall be paid to the person entitled to the shares at the date of the sale.

PART V - CALLS ON SHARES AND FORFEITURE

 

20.

Making of calls

 

  (a)

Subject to the terms of allotment, the Directors may make calls upon the members in respect of any moneys unpaid on their shares and each member (subject to receiving at least fourteen (14) Clear Days’ notice (or any longer period required by the Listing Rules) specifying when and where payment is to be made) shall pay to the Company as required by the notice the amount called on his shares. A call may be required to be paid by instalments. A call may be revoked before receipt by the Company of a sum due thereunder, in whole or in part and payment of a call may be postponed in whole or in part. A person upon whom a call is made shall remain liable for calls made upon him notwithstanding the subsequent transfer of the shares in respect of which the call was made.

 

  (b)

While the Company is Officially Listed, it must comply with the requirements of the Listing Rules and the ASX Settlement Rules in respect of the making of calls and notice given in relation to those calls.


21.

Time of call

A call shall be deemed to have been made at the time when the resolution of the Directors authorising the call was passed.

 

22.

Liability of joint Holders

The joint Holders of a share shall be jointly and severally liable to pay all calls in respect thereof.

 

23.

Interest on calls

If a call remains unpaid after it has become due and payable, the person from whom it is due and payable shall pay interest on the amount unpaid from the day it became due until it is paid at the rate fixed by the terms of allotment of the share or in the notice of the call or, if no rate is fixed, at the appropriate rate (as defined by the Acts) but the Directors may waive payment of the interest wholly or in part.

 

24.

Instalments treated as calls

An amount payable in respect of a share on allotment or at any fixed date, whether in respect of nominal value or as an instalment of a call, shall be deemed to be a call and if it is not paid the provisions of these Articles shall apply as if that amount had become due and payable by virtue of a call.

 

25.

Power to differentiate

Subject to the terms of allotment, the Directors may make arrangements on the issue of shares for a difference between the Holders in the amounts and times of payment of calls on their shares.

 

26.

Interest on moneys advanced

The Directors, if they think fit, may receive from any member willing to advance the same all or any part of the moneys uncalled and unpaid upon any shares held by him, and upon all or any of the moneys so advanced may pay (until the same would, but for such advance, become payable) interest at such rate, not exceeding (unless the Company in general meeting otherwise directs) fifteen per cent. per annum, as may be agreed upon between the Directors and the member paying such sum in advance.

 

27.

Notice requiring payment

 

  (a)

If a member fails to pay any call or instalment of a call on the day appointed for payment thereof, the Directors, at any time thereafter during such times as any part of the call or instalment remains unpaid, may serve a notice on him requiring payment of so much of the call or instalment as is unpaid together with any interest which may have accrued.

 

  (b)

The notice shall name a further day (not earlier than the expiration of fourteen (14) Clear Days (or any earlier or longer period required by the Listing Rules) from the date of service of the notice) on or before which the payment required by the notice is to be made, and shall state that in the event of non-payment at or before the time appointed the shares in respect of which the call was made will be liable to be forfeited.


  (c)

If the requirements of any such notice as aforesaid are not complied with then, at any time thereafter before the payment required by the notice has been made, any shares in respect of which the notice has been given may be forfeited by a resolution of the Directors to that effect. The forfeiture shall include all dividends or other moneys payable in respect of the forfeited shares and not paid before forfeiture. The Directors may accept a surrender of any share liable to be forfeited hereunder.

 

  (d)

On the trial or hearing of any action for the recovery of any money due for any call it shall be sufficient to prove that the name of the member sued is entered in the Register as the Holder, or one of the Holders, of the shares in respect of which such debt accrued, that the resolution making the call is duly recorded in the minute book and that notice of such call was duly given to the member sued, in pursuance of these Articles, and it shall not be necessary to prove the appointment of the Directors who made such call nor any other matters whatsoever, but the proof of the matters aforesaid shall be conclusive evidence of the debt.

 

28.

Power of disposal

Subject to the requirements of the Listing Rules and ASX Settlement Rules in respect of forfeited shares, a forfeited share may be sold or otherwise disposed of on such terms and in such manner as the Directors think fit and at any time before a sale or disposition the forfeiture may be cancelled, on such terms as the Directors think fit. Where for the purposes of its disposal such a share is to be transferred to any person, the Directors may authorise some person to execute an instrument of transfer of the share to that person. The Company may receive the consideration, if any, given for the share on any sale or disposition thereof and may execute a transfer of the share in favour of the person to whom the share is sold or disposed of and thereupon he shall be registered as the Holder of the share and shall not be bound to see to the application of the purchase money, if any, nor shall his title to the share be affected by any irregularity or invalidity in the proceedings in reference to the forfeiture, sale or disposal of the share.

 

29.

Effect of forfeiture

A person whose shares have been forfeited shall cease to be a member in respect of the forfeited shares, but nevertheless shall remain liable to pay to the Company all moneys which, at the date of forfeiture, were payable by him to the Company in respect of the shares, without any deduction or allowance for the value of the shares at the time of forfeiture but his liability shall cease if and when the Company shall have received payment in full of all such moneys in respect of the shares.

 

30.

Statutory declaration

A statutory declaration that the declarant is a Director or the Secretary of the Company, and that a share in the Company has been duly forfeited on the date stated in the declaration, shall be conclusive evidence of the facts therein stated as against all persons claiming to be entitled to the share.


31.

Payment of sums due on share issues

The provisions of these Articles as to forfeiture shall apply in the case of non-payment of any sum which, by the terms of issue of a share, becomes payable at a fixed time, whether on account of the nominal value of the share or by way of premium, as if the same had been payable by virtue of a call duly made and notified.

 

32.

Surrender of shares

The Directors may accept the surrender of any share which the Directors have resolved to have been forfeited upon such terms and conditions as may be agreed and, subject to any such terms and conditions, a surrendered share shall be treated as if it has been forfeited.

PART VI - TRANSFER OF SHARES

 

33.

Form of instrument of transfer

Subject to such of the restrictions of these Articles and to such of the conditions of issue as may be applicable, the shares of any member may be transferred by instrument in writing in any usual or common form or any other form which the Directors may approve.

 

34.

Execution of instrument of transfer

The instrument of transfer of any share shall be executed by or on behalf of the transferor and, in cases where the share is not fully paid, by or on behalf of the transferee. The transferor shall be deemed to remain the Holder of the share until the name of the transferee is entered in the Register in respect thereof.

 

35.

Refusal to register transfers

 

  (a)

The Directors in their absolute discretion and without assigning any reason therefor may decline to register:

 

  (i)

any transfer of a share which is not fully paid; or

 

  (ii)

any transfer of a share to or by a minor or person of unsound mind,

but this shall not apply to a transfer of such a share resulting from a sale of the share through a stock exchange on which the share is quoted, where permitted by the Acts, unless Article 41 applies.

 

  (b)

The Directors may decline to recognise any instrument of transfer unless:

 

  (i)

the instrument of transfer is accompanied by the certificate of the shares to which it relates and such other evidence as the Directors may reasonably require to show the right of the transferor to make the transfer;


  (ii)

the instrument of transfer is in respect of one class of share only;

 

  (iii)

the instrument of transfer is in favour of not more than four transferees; and

 

  (iv)

it is lodged at the registered office or at such other place as the Directors may appoint.

but this shall not apply to a transfer of such a share resulting from a sale of the share through a stock exchange on which the share is quoted, where permitted by the Acts, unless Article 41 applies.

 

36.

Procedure on refusal

If the Directors refuse to register a transfer then, within two months after the date on which the transfer was lodged with the Company, they shall send to the transferee notice of the refusal.

 

37.

Closing of transfer books

The registration of transfers of shares or of transfers of any class of shares may be suspended at such times and for such periods (not exceeding thirty days in each year) as the Directors may determine.

 

38.

Absence of registration fees

No fee shall be charged for the registration of any instrument of transfer or other document relating to or affecting the title to any share and the Directors shall exercise their discretion under Section 95(2)(a) of the Act to this effect.

 

39.

Retention of transfer instruments

The Company shall be entitled to retain any instrument of transfer which is registered, but any instrument of transfer which the Directors refuse to register shall be returned to the person lodging it when notice of the refusal is given.

 

40.

Renunciation of allotment

Nothing in these Articles shall preclude the Directors from recognising a renunciation of the allotment of any shares by the allottee in favour of some other person.

 

41.

Restrictions on Transfer

The Company may apply or ask CHESS to apply a Holding Lock to prevent a transfer or refuse to register a paper-based transfer document in the circumstances listed in Listing Rule 8.10.1.

PART VII - TRANSMISSION OF SHARES

 

42.

Death of a member

If a member dies the survivor or survivors where he was a joint Holder, and his personal representatives where he was a sole Holder or the only survivor of joint Holders, shall be the only persons recognised by the Company as having any title to his interest in the shares; but nothing herein contained shall release the estate of a deceased member from any liability in respect of any share which had been jointly held by him.


43.

Transmission on death or bankruptcy

A person becoming entitled to a share in consequence of the death or bankruptcy of a member may elect, upon such evidence being produced as the Directors may properly require, either to become the Holder of the share or to have some person nominated by him registered as the transferee. If he elects to become the Holder he shall give notice to the Company to that effect. If he elects to have another person registered he shall execute an instrument of transfer of the share to that person. All of these Articles relating to the transfer of shares shall apply to the notice or instrument of transfer as if it were an instrument of transfer executed by the member and the death or bankruptcy of the member had not occurred.

 

44.

Rights before registration

A person becoming entitled to a share by reason of the death or bankruptcy of a member (upon supplying to the Company such evidence as the Directors may reasonably require to show his title to the share) shall have the rights to which he would be entitled if he were the Holder of the share, except that, before being registered as the Holder of the share, he shall not be entitled in respect of it to attend or vote at any meeting of the Company or at any separate meeting of the Holders of any class of shares in the Company, so, however, that the Directors, at any time, may give notice requiring any such person to elect either to be registered himself or to transfer the share and, if the notice is not complied with within ninety days, the Directors thereupon may withhold payment of all dividends, bonuses or other moneys payable in respect of the share until the requirements of the notice have been complied with.

PART VIII - ALTERATION OF SHARE CAPITAL

 

45.

Increase of capital

 

  (a)

Subject to the Listing Rules, the Company from time to time by ordinary resolution may increase the share capital by such sum, to be divided into shares of such amount, as the resolution shall prescribe.

 

  (b)

Subject to the provisions of the Acts and the Listing Rules, the new shares shall be issued to such persons, upon such terms and conditions and with such rights and privileges annexed thereto as the general meeting resolving upon the creation thereof shall direct and, if no direction be given, as the Directors shall determine and in particular such shares may be issued with a preferential or qualified right to dividends and in the distribution of the assets of the Company and with a special, or without any, right of voting.

 

  (c)

Except so far as otherwise provided by the conditions of issue or by these Articles, any capital raised by the creation of new shares shall be considered part of the pre-existing ordinary capital and shall be subject to the provisions herein contained with reference to calls and instalments, transfer and transmission, forfeiture, lien and otherwise.


46.

Consolidation, sub-division and cancellation of capital

The Company, by ordinary resolution, may:

 

  (a)

consolidate and divide all or any of its share capital into shares of larger amount;

 

  (b)

subject to the Acts, subdivide its shares, or any of them, into shares of smaller amount, so however that in the sub-division the proportion between the amount paid and the amount, if any, unpaid on each reduced share shall be the same as it was in the case of the share from which the reduced share is derived (and so that the resolution whereby any share is sub-divided may determine that, as between the Holders of the shares resulting from such sub-division, one or more of the shares may have, as compared with the others, any such preferred, deferred or other rights or be subject to any such restrictions as the Company has power to attach to unissued or new shares); or

 

  (c)

cancel any shares which, at the date of the passing of the resolution, have not been taken or agreed to be taken by any person and reduce the amount of its authorised share capital by the amount of the shares so cancelled.

 

47.

Fractions on consolidation

Subject to the provisions of these Articles, whenever as a result of a consolidation of shares any members would become entitled to fractions of a share, the Directors may sell, on behalf of those members, the shares representing the fractions for the best price reasonably obtainable to any person and distribute the proceeds of sale in due proportion among those members, and the Directors may authorise some person to execute an instrument of transfer of the shares to, or in accordance with the directions of, the purchaser. The transferee shall not be bound to see to the application of the purchase money nor shall his title to the shares be affected by any irregularity in or invalidity of the proceedings in reference to the sale.

 

48.

Purchase of own shares

Subject to and in accordance with the provisions of the Acts and the Listing Rules and without prejudice to any relevant special rights attached to any class of shares, the Company may purchase any of its own shares of any class (including redeemable shares) at any price (whether at par or above or below par), and so that any shares to be so purchased may be selected in any manner whatsoever and cancelled or held by the Company as treasury shares:

 

  (a)

In accordance with Section 1075 of the Act the Company shall not make an off-market purchase of shares in the Company unless the purchase has first been authorised by a special resolution of the Company pre-approving a specific contract to purchase the shares; and


  (b)

In accordance with Section 1074 of the Act the Company shall not make a market purchase or overseas market purchase of shares in the Company unless the purchase has first been authorised by an ordinary resolution of the Company giving general authority for the purchase of said shares and such authority should specify the maximum number of shares authorised to be acquired and determine both the maximum and minimum prices which may be paid for those shares.

 

49.

Reduction of capital

In accordance with Section 84 of the 2014 Act, the Company, by special resolution, may reduce its share capital, any capital redemption reserve fund, any share premium account or any undenominated capital in any manner and with, and subject to, any incident authorised, and consent required, by law.

PART IX - GENERAL MEETINGS

 

50.

The Location of Annual and other General Meetings

 

  (a)

Annual general meetings of the Company are not required to be held within the State where a resolution providing that it be held elsewhere has been passed at the preceding annual general meeting.

 

  (b)

Extraordinary general meetings are not required to be held within the State.

 

51.

Annual general meetings

The Company shall hold in each calendar year a general meeting as its annual general meeting in addition to any other meeting in that year and shall specify the meeting as such in the notices calling it. Not more than fifteen months shall elapse between the date of one annual general meeting and that of the next. The Company will announce the date of the annual general meeting no less than thirty five (35) Business Days before such annual general meeting is due to be held.

 

52.

Extraordinary general meetings

All general meetings other than annual general meetings shall be called extraordinary general meetings.

 

53.

Convening and putting items on the agenda of general meetings

 

  (a)

The Directors may convene general meetings.

 

  (b)

One or more members who alone or together hold 10% of the Company’s issued share capital may request that an item be placed on the agenda of any general meeting, provided that each such item is accompanied by stated grounds justifying its inclusion or a draft resolution, together not to exceed 1,000 words, to be adopted at such general meeting.


  (c)

A request by a member under Article 53(b) shall be received by the Company in:

 

  (i)

hardcopy form; or

 

  (ii)

electronic form,

at such postal or email address as has been specified by the Company for that purpose in:

 

  (A)

the announcement of the intention to convene an annual general meeting in accordance with Article 51; or

 

  (B)

the announcement of the intention to convene an extraordinary general meeting in accordance with Article 55(a),

at least thirty (30) Business Days before the general meeting to which it relates.

 

  (d)

A request by a member under Article 53(b) shall be declined where:

 

  (i)

The form or content of the request is contrary to the Company’s Memorandum or Articles of Association, any provision of the Acts, any other enactment or the Listing Rules; or

 

  (ii)

The procedure and time limits set out in this Article have not been complied with.

 

54.

Class meetings

 

  (a)

At any time when the Company has two or more classes of shares, every decision by the general meeting shall be subject to a separate vote (to be taken by a poll) by each class of shareholders whose class rights are affected thereby.

 

  (b)

All provisions of these Articles relating to general meetings of the Company shall, mutatis mutandis, apply to every separate general meeting of the holders of any class of shares in the capital of the Company, except that:

 

  (i)

the necessary quorum shall be one or more persons holding or representing by proxy at least 5% in nominal value of the issued shares of the class or, at any adjourned meeting of such class, at least 5% in nominal value of the issued shares of the class present in person or by proxy, shall be deemed to constitute a meeting; and

 

  (ii)

any Holder of shares of the class present in person or by proxy may demand a poll; and

 

  (iii)

on a poll, each Holder of shares of the class shall have one vote in respect of every share of the class held by him.


55.

Notice of general meetings

 

  (a)

Subject to the provisions of the Acts allowing a general meeting to be called by shorter notice, an annual general meeting and an extraordinary general meeting shall be called by at least twenty-one Clear Days’ notice. The Company will announce the intention to call an extraordinary general meeting no less than thirty five (35) Business Days before such extraordinary general meeting is due to be held, save in exceptional circumstances where the Directors resolve that it is in the Company’s interests to issue notice convening a general meeting forthwith and without giving such notice of the intention to convene such general meeting.

 

  (b)

Any notice convening a general meeting shall specify the time and place of the meeting and, in the case of special business, the general nature of that business and, in reasonable prominence, that a member entitled to attend and vote is entitled to appoint a proxy to attend, speak and vote in his place and that proxy need not be a member of the Company. It shall also give particulars of any Directors who are to retire by rotation or otherwise at the meeting and of any persons who are recommended by the Directors for appointment or re-appointment as Directors at the meeting or in respect of whom notice has been duly given to the Company of the intention to propose them for appointment or re-appointment as Directors at the meeting. Subject to any restrictions imposed on any shares, the notice shall be given to all the members and to the Directors, the Auditors and to any other person to whom the Company is required to give notice under the Listing Rules.

 

  (c)

The accidental omission to give notice of a meeting to, or the non-receipt of notice of a meeting by, any person entitled to receive notice shall not invalidate the proceedings at the meeting.

 

56.

Means of Holding of General Meetings

Subject to the provisions of the Acts concerning annual general meetings, all general meetings (including annual, extraordinary and class meetings of the members of the Company) may be conducted by the use of a webcast, conference telephone or similar facility provided that the members (whether present in person, by proxy or by authorised representative), other persons entitled to attend such meetings and the Auditors have been notified of the convening of the meeting and the availability of the webcast, conference telephone or similar facility for the meeting and, if present at the meeting as hereinafter provided, can hear and contribute to the meeting. Such participation in a meeting shall constitute presence and attendance in person at the meeting and the persons in attendance may be situated in any part of the world for any such meeting.

 

57.

Record Date

Subject to any waiver that may be granted by the ASX, the Company must comply with the Listing Rules and the ASX Settlement Rules in settling any Record Date.


PART X - PROCEEDINGS AT GENERAL MEETINGS

 

58.

Quorum for general meetings

 

  (a)

No business other than the appointment of a chairman shall be transacted at any general meeting unless a quorum of members is present at the time when the meeting proceeds to business. Two persons who alone or together hold at least 5% of the issued share capital and who are entitled to vote upon the business to be transacted, each being a member or a proxy for a member or a duly authorised representative of a corporate member, shall be a quorum.

 

  (b)

If such a quorum is not present within half an hour from the time appointed for the meeting, the meeting shall stand adjourned to the same day in the next week at the same time and place, or to such time and place as the Directors may determine. If at the adjourned meeting such a quorum is not present within half an hour from the time appointed for the meeting, the meeting shall be dissolved.

 

59.

Special business

All business shall be deemed special that is transacted at an extraordinary general meeting. All business that is transacted at an annual general meeting shall also be deemed special, with the exception of:

 

  (a)

the consideration of the Company’s statutory financial statements and the report of the Directors and the report of the Auditors on those statements and that report;

 

  (b)

the review by the members of the Company’s affairs;

 

  (c)

the declaration of a dividend (if any) of an amount not exceeding the amount recommended by the Directors;

 

  (d)

the election of Directors in the place of those retiring (whether by rotation or otherwise);

 

  (e)

(subject to Sections 380 and 382 to 385 of the Act) the appointment or re-appointment of Auditors; and

 

  (f)

the authorisation of the Directors to approve the remuneration of the Auditors.

 

60.

Chairman of general meetings

The Chairman of the board of Directors or, in his absence, the Deputy Chairman (if any) or, in his absence, some other Director nominated by the Directors, shall preside as chairman at every general meeting of the Company. If at any general meeting none of such persons shall be present within fifteen minutes after the time appointed for the holding of the meeting and willing to act, the Directors present shall elect one of their number to be chairman of the meeting and, if there is only one Director present and willing to act, he or she shall be chairman.


61.

Directors’ and Auditors’ and Advisors’ right to attend general meetings

A Director shall be entitled, notwithstanding that he is not a member, to attend and speak at any general meeting and at any separate meeting of the Holders of any class of shares in the Company. The Auditors shall be entitled to attend any general meeting and to be heard on any part of the business of the meeting which concerns them as the Auditors. Advisors where invited to attend a general meeting by the Directors, shall be entitled to attend such general meeting.

 

62.

Adjournment of general meetings

The chairman, with the consent of a meeting at which a quorum is present, may (and if so directed by the meeting, shall) adjourn the meeting from time to time (or indefinitely) and from place to place, but no business shall be transacted at any adjourned meeting other than business which might properly have been transacted at the meeting had the adjournment not taken place. Where a meeting is adjourned indefinitely, the time and place for the adjourned meeting shall be fixed by the Directors. When a meeting is adjourned for fourteen days or more or indefinitely, at least seven Clear Days’ notice shall be given specifying the time and meeting and the general nature of the business to be transacted. Save as aforesaid it shall not be necessary to give any notice of an adjourned meeting.

 

63.

Determination of resolutions

At any general meeting a resolution put to the vote of the meeting shall be decided on a poll.

 

64.

Taking of a poll

A poll shall be taken in such manner as the chairman directs and he may appoint scrutineers (who need not be members) and fix a time and place for declaring the result of the poll. The result of the poll shall be deemed to be the resolution of the meeting at which the poll was held.

 

65.

Votes of members

Votes may be given either personally or by proxy or a duly authorised representative of a corporate member. Subject to any rights or restrictions for the time being attached to any class or classes of shares every member present in person or by proxy or a duly authorised representative of a corporate member shall have one vote for every share carrying voting rights of which he is the Holder. On a poll a member entitled to more than one vote need not use all his votes or cast all the votes he or his proxy or proxies uses in the same way.

 

66.

Chairman’s casting vote

Where there is an equality of votes on a poll, the chairman of the meeting at which poll is held shall be entitled to a casting vote in addition to any other vote he may have.


67.

Voting by joint Holders

Where there are joint Holders of a share, the vote of the senior who tenders a vote, whether in person or by proxy, in respect of such share shall be accepted to the exclusion of the votes of the other joint Holders; and for this purpose seniority shall be determined by the order in which the names of the Holders stand in the Register in respect of the share.

 

68.

Voting by incapacitated Holders

A member of unsound mind, or in respect of whom an order has been made by any court having jurisdiction (whether in the State or elsewhere) in matters concerning mental disorder, may vote, on a poll, by his committee, receiver, guardian or other person appointed by that court and any such committee, receiver, guardian or other person may vote by proxy on a poll. Evidence to the satisfaction of the Directors of the authority of the person claiming to exercise the right to vote shall be received at the Registered Office or at such other address as is specified in accordance with these Articles for the receipt of appointments of proxy, not less than forty-eight hours before the time appointed for holding the meeting or adjourned meeting at which the right to vote is to be exercised and in default the right to vote shall not be exercisable.

 

69.

Default in payment of calls

Unless the Directors otherwise determine, no member shall be entitled to vote at any general meeting or any separate meeting of the Holders of any class of shares in the Company, either in person or by proxy, or to exercise any privilege as a member in respect of any share held by him unless all moneys then payable by him in respect of that share have been paid.

 

70.

Restriction on voting by Company and its subsidiaries

No votes may be cast in the general meeting in respect of any share if:

 

  (a)

the depositary receipt for such share; or

 

  (b)

the CUFS issued in respect of such share,

is held by the Company or by a subsidiary of the Company.

 

71.

Restriction of voting rights by Holders

 

  (a)

If at any time the Directors shall determine that a Specified Event (as defined in paragraph (f) shall have occurred in relation to any share or shares the Directors may serve a notice to such effect on the Holder or Holders thereof. Upon the service of any such notice (in these Articles referred to as a “ Restriction Notice ”) no Holder or Holders of the share or shares specified in such Restriction Notice shall be entitled, for so long as such Restriction Notice shall remain in force, to attend or vote at any general meeting or either personally or by proxy.


  (b)

A Restriction Notice shall be cancelled by the Directors as soon as reasonably practicable, but in any event not later than forty-eight hours, after the Holder or Holders concerned shall have remedied the default by virtue of which the Specified Event shall have occurred. A Restriction Notice shall automatically cease to have effect in respect of any share transferred upon registration of the relevant transfer provided that a Restriction Notice shall not cease to have effect in respect of any transfer where no change in the beneficial ownership of the share shall occur and for this purpose it shall be assumed that no such change has occurred where a transfer form in respect of the share is presented for registration having been stamped at a reduced rate of stamp duty by virtue of the transferor or transferee claiming to be entitled to such reduced rate as a result of the transfer being one where no beneficial interest passes.

 

  (c)

The Directors shall cause a notation to be made in the Register against the name of any Holder or Holders in respect of whom a Restriction Notice shall have been served indicating the number of shares specified in such Restriction Notice and shall cause such notation to be deleted upon cancellation or cesser of such Restriction Notice.

 

  (d)

Any determination of the Directors and any notice served by them pursuant to the provisions of this Article shall be conclusive as against the Holder or Holders of any share and the validity of any notice served by the Directors in pursuance of this Article shall not be questioned by any person.

 

  (e)

If, while any Restriction Notice shall remain in force in respect of any Holder or Holders of any shares, such Holder or Holders shall be issued with any further shares as a result of such Holder or Holders not renouncing any allotment of shares made to him or them pursuant to a capitalisation issue under Part XXII of these Articles, the Restriction Notice shall be deemed also to apply to such Holder or Holders in respect of such further shares on the same terms and conditions as were applicable to the said Holder or Holders immediately prior to such issue of further shares.

 

  (f)

For the purpose of these Articles the expression “ Specified Event ” in relation to any share shall mean the failure by the Holder or Holders thereof to pay any call or instalment of a call when such a call is due and payable.

 

72.

Voting Exclusion Statements

If, under the Listing Rules, a notice of meeting contains a Voting Exclusion Statement, any votes cast on the resolution by the named person (or class of person) excluded from voting or an associate of that person or those persons must be disregarded.

 

73.

Time for objection to voting

No objection shall be raised to the qualification of any voter except at the meeting or adjourned meeting at which the vote objected to is tendered and every vote not disallowed at such meeting shall be valid. Any such objection made in due time shall be referred to the chairman of the meeting whose decision shall be final and conclusive.


74.

Appointment of proxy

 

  (a)

Every member entitled to attend and vote at a general meeting may appoint a proxy to attend, speak and vote on his behalf and where a member holds more than one share carrying voting rights the member may appoint more than one proxy to attend, speak and vote at the same meeting the shares in respect of which the proxy has been so appointed. The appointment of a proxy shall be in writing in any usual form or in any other form which the Directors may approve and shall be signed by or on behalf of the appointor, provided that such form as required by the Listing Rules is used. The signature on such appointment need not be witnessed. A body corporate may sign a form of proxy under its common seal or under the hand of a duly authorised officer thereof or in such other manner as the Directors may approve. A proxy need not be a member of the Company. The appointment of a proxy in electronic form shall only be effective in such manner as the Directors may approve.

 

  (b)

Without limiting paragraph (a), the Directors may from time to time permit appointments of a proxy to be made by means of an electronic or internet communication or facility and may in a similar manner permit supplements to, or amendments or revocations of, any such electronic or internet communication or facility to be made. The Directors may in addition prescribe the method of determining the time at which any such electronic or internet communication or facility is to be treated as received by the Company. The Directors may treat any such electronic or internet communication or facility which purports to be or is expressed to be sent on behalf of a member as sufficient evidence of the authority of the person sending that instruction to send it on behalf of that member.

 

75.

Bodies corporate acting by representatives at meetings

Any body corporate which is a member of the Company may by resolution of its directors or other governing body authorise such person or persons as it thinks fit to act as its representative or representatives at any meeting of the Company or of any class of members of the Company and any person so authorised shall be entitled to exercise the same powers on behalf of the body corporate which he represents as that body corporate could exercise if it were an individual member of the Company. Where a member appoints more than one representative in relation to a general meeting each representative must be appointed to exercise the rights attaching to a different share or shares held by the member.

 

76.

Receipt of proxy appointment

Where the appointment of a proxy and any authority under which it is signed or a copy, certified notarially or in some other way approved by the Directors is to be received by the Company:

 

  (a)

in physical form it shall be deposited at the registered office or (at the option of the member) at such other place or places (if any) as may be specified for that purpose in or by way of note to the notice convening the meeting; or


  (b)

in electronic form, it may be so received where an address has been specified by the Company for the purpose of receiving electronic communications:

 

  (i)

in the notice convening the meeting; or

 

  (ii)

in any appointment of proxy sent out by the Company in relation to the meeting; or

 

  (iii)

in any invitation contained in an electronic communication to appoint a proxy issued by the Company in relation to the meeting,

provided that it is so received by the Company not less than forty-eight hours (48) (or such lesser time as the Directors specify) before the time appointed for the holding of the meeting or adjourned meeting or (in the case of a poll taken otherwise than at or on the same day as the meeting or adjourned meeting) for the taking of the poll at which it is to be used, and in default shall not be treated as valid or, in the case of a meeting which is adjourned to, or a poll which is to be taken on, a date which is less than seven days after the date of the meeting which was adjourned or at which the poll was declared, it shall be sufficient if the appointment of proxy and any such authority and certification thereof as aforesaid is so received by the Company at the commencement of the adjourned meeting or the taking of the poll. An appointment of proxy relating to more than one meeting (including any adjournment thereof) having once been so received for the purposes of any meeting shall not require to be delivered, deposited or received again for the purposes of any subsequent meeting to which it relates.

 

77.

Effect of proxy appointments

Receipt by the Company of an appointment of proxy in respect of a meeting shall not preclude a member from attending and voting at the meeting or at any adjournment thereof. An appointment proxy shall be valid, unless the contrary is stated therein, for any adjournment of the meeting as for the meeting to which it relates.

 

78.

Effect of revocation of proxy or of authorisation

 

  (a)

A vote given in accordance with the terms of an appointment of proxy or a resolution authorising a representative to act on behalf of a body corporate shall be valid notwithstanding the death or insanity of the principal, or the revocation of the appointment of proxy or of the authority under which the proxy was appointed or of the resolution authorising the representative to act or transfer of the share in respect of which the proxy was appointed or the authorisation of the representative to act was given, provided that no intimation in writing (whether in electronic form or otherwise) of such death, insanity, revocation or transfer shall have been received by the Company at the Office before the commencement of the meeting or adjourned meeting at which the appointment of proxy is used or at which the representative acts provided however, that where such intimation is given in electronic form it shall have been received by the Company before the commencement of the meeting.

 

  (b)

The Directors may send, at the expense of the Company, by post, electronic mail or otherwise, to the members forms for the appointment of a proxy (with or without stamped envelopes for their return) for use at any general meeting or at any class meeting, either in blank or nominating any one or more of the Directors or any other persons in the alternative. If for the purpose of any meeting invitations to appoint as proxy a person or one of a number of persons specified in the invitations are issued at the expense of the Company, such invitations shall be issued to all (and not to some only) of the members entitled to be sent a notice of the meeting and to vote thereat by proxy, but the accidental omission to issue such invitations to, or the non-receipt of such invitations by, any member shall not invalidate the proceedings at any such meeting.


PART XI – COVENANTS WITH MEMBERS WHERE CUFS ARE IN ISSUE

Articles 79 to 95 shall only apply where CUFS are quoted on ASX and are intended to be for the benefit of the holder of CUFS but, without prejudice to any other contractual rights of the CUFS holders, these Articles shall be enforceable under these Articles only as against the Company by the registered member of the shares in respect of which CUFS have been issued.

 

79.

Non-Statutory Registers

The Company shall establish and maintain any such registers as required to be established and maintained by it under the Listing Rules or the ASX Settlement Rules (the “ Non-Statutory Registers”) and:

 

  (a)

The board of Directors shall have the power and authority to permit auditing of the Non-Statutory Registers at such intervals, and by such persons and in such manner, as required by the Listing Rules and the ASX Settlement Rules.

 

  (b)

The board of Directors shall have power and authority to permit inspection of the Non-Statutory Registers and to provide information recorded therein as well as any other information regarding the direct or indirect shareholding of a shareholder of which the Company has been notified by that shareholder to the authorities entrusted with the supervision and/or implementation of the trading of CUFS on the ASX.

 

  (c)

Part of the Non-Statutory Registers may be kept abroad, in addition to in the State, in order to comply with the Listing Rules.

 

80.

Notice of General Meetings

CUFS holders shall be entitled to receive notice of and to attend general meetings of the Company in the same manner as set out in Articles 55 and 56 but shall not be entitled to vote.

 

81.

Registration of Transfers of CUFS

The Directors must refuse to register or authorise any transfer of CUFS:

 

  (a)

not permitted under the Listing Rules or the ASX Settlement Rules; or

 

  (b)

if permitted only on conditions contained in the Listing Rules or the ASX Settlement Rules, then upon satisfaction of those conditions.


82.

Other Provisions on the Registration of Transfers of CUFS

The following shall apply:

 

  (a)

The transfer of any CUFS in respect of shares in the Company may be effected by a Proper ASTC Transfer.

 

  (b)

Upon receipt of a Proper ASTC Transfer and subject to the Listing Rules and the ASX Settlement Rules, the Directors must approve registration of a transferee named in the transfer as a CUFS Holder.

 

  (c)

The transferor will be deemed to remain the holder of the CUFS until a Proper ASTC Transfer has been effected or the name of the transferee is entered in the relevant register as the holder of the CUFS.

 

  (d)

The Company must not require a statutory declaration or other document in connection with ownership restrictions of its CUFS before it will register a transfer document.

 

  (e)

The Directors may decline to register or may prevent registration of a transfer of CUFS or may apply a Holding Lock to prevent a transfer in accordance with the Listing Rules if: (i) the transfer is not in a registrable form; or (ii) registration of the transfer may breach a law of Australia.

 

  (f)

The Directors must cause notice of any action under Article 82(e) to be given as required by the Listing Rules. Failure to do so will not invalidate the action.

 

  (g)

The Directors may suspend the registration of transfers at the times and for the periods they determine, but only as permitted by the ASX Settlement Rules.

 

  (h)

The Directors must ensure that the Company does not charge a fee for registering, issuing, handling or otherwise dealing with CUFS transfers and holding statements and other documents evidencing transactions or information with respect to its CUFS, as required by, or unless allowed by, Listing Rule 8.14.

 

  (i)

The Directors may decline to register or may prevent registration of a transfer of CUFS or may apply a Holding Lock to prevent a transfer in accordance with the Listing Rules if the transfer is paper-based and registration of the transfer will create a new holding that will be a Non-marketable Parcel.

 

  (j)

The Company may elect to, but is not required to, register more than 3 persons as joint holders of CUFS, unless the joint holders become entitled due to transmission upon the death of a CUFS Holder or unless required to do so under the Listing Rules or the ASX Settlement Rules.

Divestment of Non-marketable Parcel of CUFS

 

83.

A divestment under Article 85 is subject to and must occur in accordance with the Listing Rules and the ASX Settlement Rules, including ASX Settlement Rule 5.12, which shall prevail in the event of any inconsistency with any of the provisions of Article 85 to Article 95.


84.

The provisions of Article 85 to Article 95 only apply to Securities in a new holding created by the transfer of a parcel of Securities that was less than a Marketable Parcel at the time the transfer document was initiated or, in the case of a paper based transfer document, was lodged with the Company.

 

85.

The board of Directors may cause the Company to sell a CUFS Holder’s CUFS if the CUFS Holder holds less than a Non-marketable Parcel and the procedures in Articles 86 to 95 are observed.

Notice of Proposed Sale of CUFS

 

86.

Once in any 12 month period, the Company may give written notice to a CUFS Holder who holds a Non-marketable Parcel or, if held by joint CUFS Holders, to all of the joint CUFS Holders:

 

  (a)

explaining the effect of this Article 86;

 

  (b)

stating that it intends to sell the Non-marketable Parcel; and

 

  (c)

specifying a date at least 35 Business Days after the notice is given by which the CUFS Holder may give the Company written notice that the CUFS Holder wishes to retain the holding.

No sale where CUFS holder gives notice

 

87.

The Company must not sell a Non-marketable Parcel if the Company receives a written notice that the CUFS Holder wants to retain it.

Terms of Sale

 

88.

The Company may sell the Securities which make up the Non-marketable Parcel as soon as practicable at a price which the Directors consider to be the best price reasonably obtainable for the Securities at the time they are sold. A sale of Securities under this Article includes all dividends payable on and other rights attaching to them. The Company must pay the costs of the sale if not prohibited from doing so by the Acts or law, or must cause the purchaser to do so. Otherwise, the Directors may decide the manner, time and terms of sale.

 

89.

For the purpose of giving effect to Article 88 the Directors may authorise a person, without further leave or consent from a relevant member, to execute a transfer as agent for the relevant member on behalf of the CUFS Holder who holds a Non-marketable Parcel.


Change in circumstance

 

90.

If a CUFS Holder’s holding becomes a Marketable Parcel after notice is given but before the Securities are sold, the Directors may decide that Articles 83 to 95 no longer applies to that holding. Before a sale is effected under Articles 85 to 95, the Directors may suspend or terminate the operation of this Article either generally or in the case of a specific CUFS Holder.

Application of proceeds

 

91.

The Company must:

 

  (a)

give written notice to the former CUFS Holder stating:

 

  (i)

what the amount of the sale proceeds is; and

 

  (ii)

that it is holding the balance for the former CUFS Holder while awaiting the former CUFS Holder’s return of the certificate (if any) for the Securities sold or evidence of its loss or destruction;

 

  (b)

if the Securities were certificated, not pay the amount until it has received the certificate for them or evidence satisfactory to the Company of the loss or destruction of the certificate; and

 

  (c)

subject to Article 91(b), send the amount of the sale proceeds to the former holder after the sale.

 

92.

Protection for transferee

The title of the new holder of CUFS sold under this Part XI is not affected by any irregularity in the sale. The sole remedy of any person previously interested in CUFS is damages which may be recovered only from the Company.

 

93.

No sale where takeover bid announced

The power to sell under this Part XI lapses following the announcement of a takeover bid for the Company. The procedure may be started again after the close of the offers made under the takeover bid.

 

94.

Voting Rights and Dividend Rights

The Company may remove or change the voting right or the right to receive dividends for any CUFS in a Non-marketable Parcel. If it has done so and proceeds with the sale of the Non-marketable Parcel, it must send any dividends that have been withheld to the former holder after the sale of the Non-marketable Parcel.

 

95.

No Express Permission for Holding of Non-marketable Parcel

These Articles do not contain an express permission for a CUFS Holder to have a holding of a Non-marketable Parcel for the purposes of ASX Settlement Rule 8.10.2.


PART XII – DIRECTORS

 

96.

Number of Directors

Unless otherwise determined by the Company in general meeting, the number of Directors will be the number determined by the Directors from time to time and shall not be more than twelve nor less than three. The continuing Directors may act notwithstanding any vacancy in their body, provided that if the number of the Directors is reduced below the prescribed minimum the remaining Director or Directors shall appoint an additional Director or additional Directors to make up such minimum or shall convene a general meeting of the Company for the purpose of making such appointment. If there be no Director or Directors able or willing to act then any member or members representing 5% of the Company’s issued share capital, may summon a general meeting for the purpose of appointing Directors. Any additional Director so appointed shall hold office (subject to the provisions of the Acts and these Articles) only until the conclusion of the annual general meeting of the Company next following such appointment unless he is re-elected during such meeting and he shall not retire by rotation at such meeting or be taken into account in determining the Directors who are to retire by rotation at such meeting.

 

97.

Share qualification

A Director shall not require a share qualification.

 

98.

Ordinary remuneration of Directors

 

  (a)

Subject to Article 98(b) each Director shall be paid a fee for the services (which shall be deemed to accrue from day to day) at such rate as may from time to time be determined by the board of Directors.

 

  (b)

Without prejudice to any amounts payable under any other provision of these Articles (but at all times subject to the requirements of the Listing Rules), the ordinary remuneration of Directors who do not hold executive office shall not exceed in aggregate US$2,300,000 per annum or such higher amount as the Company may from time to time by ordinary resolution determine and shall be divisible (unless such resolution shall provide otherwise) among the Directors as they may agree, or, failing agreement, equally, except that any such Director who shall hold office for part only of the period in respect of which such remuneration is payable shall be entitled only to rank in such division for a proportion of the remuneration related to the period during which he has held office. In this Article “ordinary remuneration” shall not include such sums as are paid or reimbursed in accordance with board policy regarding travelling, accommodation and other expenses that are incurred by them in connection with their attendance at meetings of Directors or committees of Directors or general meetings or separate meetings of the Holders of any class of shares or of debentures of the Company or otherwise in connection with the discharge of their duties when engaged on the business of the Company.


99 .

Special remuneration of Directors

Any Director who holds any executive office (including for this purpose the Chief Executive Officer) may be paid such extra remuneration by way of salary, commission or otherwise as the Directors may determine provided that such Director’s salary or fee must not include a commission on, or percentage of, operating revenue.

 

100.

Expenses of Directors and use of Company Property

 

  (a)

The Directors may be paid or reimbursed for all travelling, accommodation and other expenses reasonably incurred by them in accordance with Board policy regarding meetings of Directors or committees of Directors or general meetings or separate meetings of the Holders of any class of shares or of debentures of the Company or otherwise in connection with the discharge of their duties when engaged on the business of the Company.

 

  (b)

A Director is expressly permitted (for the purposes of Section 228(1)(d) of the Act) to use the Company’s property subject to such conditions as may be approved by the Board or such conditions as may have been approved pursuant to such authority as may be delegated by the Board in accordance with these Articles.

 

101.

Alternate Directors

 

  (a)

Any Director may appoint by writing (whether in electronic form or otherwise) under his hand any person (including another Director) to be his alternate provided always that no such appointment of a person other than a Director as an alternate shall be operative unless and until such appointment shall have been approved by resolution of the Directors. Any such authority may be sent by delivery, post, cable, telegram, telex, telefax, electronic mail or any other means of communication approved by the Directors and may bear a printed, facsimile, electronic or advanced electronic signature of the Director giving such authority.

 

  (b)

An alternate Director shall be entitled, subject to his giving to the Company an address (whether within or outside of the State), to receive notices of all meetings of the Directors and of all meetings of committees of Directors of which his appointor is a member, to attend and vote at any such meeting at which the Director appointing him is not personally present and in the absence of his appointor to exercise all the powers, rights, duties and authorities of his appointor as a Director (other than the right to appoint an alternate hereunder).

 

  (c)

Save as otherwise provided in these Articles, an alternate Director shall be deemed for all purposes to be a Director and shall alone be responsible for his own acts and defaults and he shall not be deemed to be the agent of the Director appointing him. The remuneration of any such alternate Director shall be payable out of the remuneration paid to the Director appointing him and shall consist of such portion of the last mentioned remuneration as shall be agreed between the alternate and the Director appointing him.

 

  (d)

A Director may revoke at any time the appointment of any alternate appointment by him. If a Director shall die or cease to hold the office of Director the appointment of his alternate shall thereupon cease and determine.


  (e)

If a Director retires by rotation or otherwise but is re-appointed or deemed to have been reappointed at the meeting at which he retires, any appointment of an alternate Director made by him which was in force immediately prior to his retirement shall continue after his re-appointment or deemed re-appointment.

 

  (f)

Any appointment or revocation by a Director under this Article shall be effected by notice in writing (whether in electronic form or otherwise) given under his hand to the Secretary or deposited or received at the registered office or in any other manner approved by the Directors.

PART XIII - POWERS OF DIRECTORS

 

102.

Directors’ powers

Subject to the provisions of the Acts, the Memorandum of Association of the Company and these Articles and to any directions by the members given by special resolution, not being inconsistent with these Articles or with the Acts, the business of the Company shall be managed by the Directors who may do all such acts and things and exercise all the powers of the Company as are not by the Acts or by these Articles required to be done or exercised by the Company in general meeting. No alteration of the Memorandum of Association of the Company or of these Articles and no such direction shall invalidate any prior act of the Directors which would have been valid if that alteration had not been made or that direction had not been given. The powers given by this Article shall not be limited by any special power given to the Directors by these Articles and a meeting of Directors at which a quorum is present may exercise all powers exercisable by the Directors.

 

103.

Power to delegate

Without prejudice to the generality of Article 102, the Directors may delegate any of their powers to:

 

  (a)

the Chief Executive Officer, any Director or any person or persons employed by the Company or any of its subsidiaries. For the avoidance of doubt, any Chief Executive Officer, Director or person to whom the Directors have delegated any of their powers, in accordance with this Article 103(a), may delegate such power to another person or committee of the Board, or

 

  (b)

to any committee of the Board consisting of one or more Directors together with such other persons (if any) as may be appointed to such committee by the Directors provided that a majority of the members of each committee appointed by the Directors shall at all times consist of Directors and that no resolution of any such committee shall be effective unless a majority of the members of the committee present at the meeting at which it was passed are Directors.

Any such delegation may be made subject to any conditions the Directors may impose, and either collaterally with or to the exclusion of their own powers and may be revoked. Subject to any such conditions, the proceedings of a committee of the Board with two or more members shall be governed by the provisions of these Articles regulating the proceedings of Directors so far as they are capable of applying.


For the avoidance of doubt, a person or committee to whom or to which the Directors have delegated any of their powers, in accordance with this Article 103, may delegate such power to another person or to a sub-committee in the same manner.

 

104.

Appointment of attorneys

The Directors, from time to time and at any time by power of attorney under seal, may appoint any company, firm or person or fluctuating body of persons, whether nominated directly or indirectly by the Directors, to be the attorney or attorneys of the Company for such purposes and with such powers, authorities and discretions (not exceeding those vested in or exercisable by the Directors under these Articles) and for such period and subject to such conditions as they may think fit. Any such power of attorney may contain such provisions for the protection of persons dealing with any such attorney as the Directors may think fit and may authorise any such attorney to sub-delegate all or any of the powers, authorities and discretions vested in him.

 

105.

Local management

Without prejudice to the generality of Article 103 but strictly subject to Article 3, the Directors may establish any committees, local boards or agencies for managing any of the affairs of the Company, either in the State or elsewhere, and may appoint any persons to be members of such committees, local boards or agencies and may fix their remuneration and may delegate to any committee, local board or agent any of the powers, authorities and discretions vested in the Directors with power to sub-delegate and any such appointment or delegation may be made upon such terms and subject to such conditions as the Directors may think fit, and the Directors may remove any person so appointed, and may annul or vary any such delegation, but no person dealing in good faith with any such committee, local board or agency, without notice of any such removal, annulment or variation shall be affected thereby.

 

106.

Borrowing powers

The Directors may exercise all the powers of the Company to borrow or raise money and to mortgage or charge its undertaking, property, assets, and uncalled capital or any part thereof and subject to the Acts to issue debentures, debenture stock and other securities whether outright or as collateral security for any debt, liability or obligation of the Company or of any third party, without any limitation as to amount.

 

107.

Execution of negotiable instruments

All cheques, promissory notes, drafts, bills of exchange and other negotiable instruments and all receipts for moneys paid to the Company shall be signed, drawn, accepted, endorsed or otherwise executed, as the case may be, by such person or persons and in such manner as the Directors shall determine from time to time by resolution.

 

108.

Participation in CHESS

 

  (a)

The Directors may resolve to do anything that is necessary or desirable for the Company to participate in any computerised, electronic or other system for the facilitation of the transfer of CUFS or the operation of the Company’s registers that may be owned, operated or sponsored by ASX or a related body corporate of ASX.


  (b)

While the Company remains a participant in any such system:

 

  (i)

it must comply with the Listing Rules and the ASX Settlement Rules relating to transfers, divestment of holdings, holding statements for new holdings and changed holdings and replacement certificates;

 

  (ii)

it need not do anything that, as a participant, it is relieved of doing by the Acts or law or would otherwise be required to do by these Articles; and

 

  (iii)

it must comply with ASX Settlement Rule 5.21 with respect to any rights issue.

PART XIV - APPOINTMENT AND RETIREMENT OF DIRECTORS

 

109.

Retirement

 

  (a)

At each annual general meeting of the Company one-third of the Directors who are subject to retirement by rotation, or if their number is not three or a multiple of three then the number nearest to one-third, shall retire from office, but if there is only one Director who is subject to retirement by rotation then he shall retire provided that each Director (other than the Chief Executive Officer) shall present himself for re-election at least once every three years.

 

  (b)

At each of the first three annual general meetings following 17 June 2010, the Directors (including any Directors holding executive office pursuant to these Articles but excluding the Chief Executive Officer) to retire by rotation shall be those who have agreed to put themselves forward for retirement provided that where the number of such Directors is less than one-third, the Chairman shall nominate the Directors who are to retire.

 

  (c)

At the fourth and at each subsequent annual general meeting following 17 June 2010, the Directors (including any Directors holding executive office pursuant to these Articles but excluding the Chief Executive Officer) to retire by rotation shall be those who have been longest in office since their last appointment or reappointment but as between persons who became or were last reappointed Directors on the same day those to retire shall be determined (unless they otherwise agree among themselves) by lot.

 

  (d)

Subject to Article 110, a Director who retires at an annual general meeting may be reappointed, if willing to act. If he is not reappointed (or deemed to be reappointed pursuant to these Articles) he shall retain office until the meeting appoints someone in his place or, if it does not do so, until the end of the meeting.

 

110.

Deemed reappointment

If the Company, at the meeting at which a Director retires by rotation, does not fill the vacancy then, subject to Article 111 the retiring Director, if willing to act, shall be deemed to have been re-appointed, unless at the meeting it is resolved not to fill the vacancy or a resolution for the reappointment of the Director is put to the meeting and lost.


111.

Eligibility for appointment as a Director

 

  (a)

No person other than a Director retiring by rotation shall be appointed a Director at any general meeting unless that person is:

 

  (i)

recommended by the Directors; or

 

  (ii)

nominated in accordance with paragraph (b) by one or more members who alone or together hold 10% of the Company’s issued share capital.

 

  (b)

A nomination made in accordance with Article 111(a)(ii) shall be:

 

  (i)

lodged with the Company accompanied by a biography setting out their experience and directorships of other listed and unlisted companies of not more than 300 words together with the consent of the nominee to act as Director if appointed; and

 

  (ii)

received by the Company in hardcopy or electronic form at such postal or electronic address as has been specified by the Company for that purpose in,

 

  (A)

the announcement of the intention to convene an annual general meeting in accordance with Article 51; or

 

  (B)

the announcement of the intention to convene an extraordinary general meeting in accordance with Article 55(a),

at least thirty (30) Business Days before the general meeting to which it relates.

 

112.

Appointment of additional Directors

 

  (a)

Subject to Article 111, the Company by ordinary resolution may appoint a person to be a Director either to fill a vacancy or as an additional Director and any Director so appointed shall be subject to retire by rotation in accordance with Article 109(a).

 

  (b)

The Directors may appoint a person who is willing to act to be a Director, either to fill a vacancy or as an additional Director, provided that the appointment does not cause the number of Directors to exceed any number determined by the Directors or fixed by or in accordance with these Articles as the maximum number of Directors. A Director so appointed shall hold office only until the next following annual general meeting and shall not be taken into account in determining the Directors who are to retire by rotation at the meeting. If not re-appointed at such annual general meeting, such Director shall vacate office at the conclusion thereof.


PART XV - DISQUALIFICATION AND REMOVAL OF DIRECTORS

 

113.

Disqualification of Directors

The office of a Director shall be vacated ipso facto if:

 

  (a)

he is restricted or disqualified from acting as a director of any company under the provisions of Part 14 of the Act;

 

  (b)

he becomes bankrupt or makes any arrangement or composition with his creditors generally;

 

  (c)

in the opinion of a majority of his co-Directors, he becomes incapable by reason of mental disorder of discharging his duties as a Director;

 

  (d)

(not being a Director holding for a fixed term an executive office in his capacity as a Director) he resigns his office by notice to the Company;

 

  (e)

he is convicted of an indictable offence, unless the Directors otherwise determine; or

 

  (f)

he shall have been absent for more than six consecutive months without permission of the Directors from meetings of the Directors held during that period and his alternate Director (if any) shall not have attended any such meeting in his place during such period, and the Directors pass a resolution that by reason of such absence he has vacated office.

 

114.

Removal of Directors

The Company, by ordinary resolution of which notice has been given in accordance with the Acts, may remove any Director before the expiry of his period of office notwithstanding anything in these Articles or in any agreement between the Company and such Director and may, if thought fit, by ordinary resolution appoint another Director in his stead. The person appointed shall be subject to retirement at the same time as if he had become a Director on the date on which the Director in whose place he is appointed was last appointed a Director. Nothing in this Article shall be taken as depriving a person removed hereunder of compensation or damages payable to him in respect of the termination of his appointment as Director or of any appointment terminating with that Director.

PART XVI - DIRECTORS’ OFFICES AND INTERESTS

 

115.

Executive offices

 

  (a)

The Directors may appoint one of their body to the office of Chief Executive Officer and one or more of their body to any other executive office under the Company on such terms and for such period as they may determine and, without prejudice to the terms of any contract entered into in any particular case, may revoke any such appointment at any time.


  (b)

At all times subject to Article 99, a Director holding any such executive office shall receive such remuneration, whether in addition to or in substitution for his ordinary remuneration as a Director and whether by way of salary, commission, participation in profits or otherwise or partly in one way and partly in another, as the Directors may determine.

 

  (c)

The appointment of any Director to the office Chief Executive Officer shall terminate automatically if he ceases to be a Director but without prejudice to any claim for damages for breach of any contract of service between him and the Company.

 

  (d)

The appointment of any Director to any other executive office shall not terminate automatically if he ceases to be a Director unless the contract or resolution under which he holds executive office shall expressly state otherwise, in which event such termination shall be without prejudice to any claim for damages for breach of any contract of service between him and the Company.

 

  (e)

A Director may hold any other office or place of profit under the Company (except that of Auditor) in conjunction with his office of Director, and may act in a professional capacity to the Company, on such terms as to remuneration and otherwise as the Directors shall arrange.

 

116.

Directors’ interests

 

  (a)

Subject to the provisions of the Acts and the Listing Rules, and provided that he has disclosed to the Directors the nature and extent of any material interest of his, a Director notwithstanding his office:

 

  (i)

may be a party to, or otherwise interested in, any transaction or arrangement with the Company or any subsidiary or associated company thereof or in which the Company or any subsidiary or associated company thereof is otherwise interested;

 

  (ii)

may be a director or other officer of, or employed by, or a party to any transaction or arrangement with, or otherwise interested in, any body corporate promoted by the Company or in which the Company or any subsidiary or associated company thereof is otherwise interested; and

 

  (iii)

shall not be accountable, by reason of his office, to the Company for any benefit which he derives from any such office or employment or from any such transaction or arrangement or from any interest in any such body corporate and no such transaction or arrangement shall be liable to be avoided on the ground of any such interest or benefit.

 

  (b)

No Director or intending Director shall be disqualified by his office from contracting with the Company either as vendor, purchaser or otherwise, nor shall any such contract or any contract or arrangement entered into by or on behalf of the other Company in which any Director shall be in any way interested be avoided nor shall any Director so contracting or being so interested be liable to account to the Company for any profit realised by any such contract or arrangement by reason of such Director holding that office or of the fiduciary relationship thereby established. The nature of a Director’s interest must be declared by him at the meeting of the Directors at which the question of entering into the contract or arrangement is first taken into consideration, or if the Director was not at the date of that meeting interested in the proposed contract or arrangement at the next meeting of the Directors held after he became so interested, and in a case where the Director becomes interested in a contract or arrangement after it is made at the first meeting of the Directors held after he becomes so interested.


  (c)

A copy of every declaration made and notice given under this Article shall be entered within three days after the making or giving thereof in a book kept for this purpose. Such book shall be open for inspection without charge by any Director, Secretary, Auditor or member of the Company at the Registered Office and shall be produced at every general meeting of the Company and at any meeting of the Directors if any Director so requests in sufficient time to enable the book to be available at the meeting.

 

  (d)

For the purposes of this Article:

 

  (i)

a general notice given to the Directors that a Director is to be regarded as having an interest of the nature and extent specified in the notice in any transaction or arrangement in which a specified person or class of persons is interested shall be deemed to be a disclosure that the Director has an interest in any such transaction of the nature and extent so specified; and

 

  (ii)

an interest of which a Director has no knowledge and of which it is unreasonable to expect him to have knowledge shall not be treated as an interest of his.

 

  (e)

Directors shall be under a duty, even after they have ceased to hold office, not to divulge any information which they have concerning the Company, the disclosure of which might be prejudicial to the Company’s interests, except where such disclosure is required or permitted under the national law provisions applicable to public limited liability companies or is in the public interest.

 

117.

Restriction on Directors’ voting

 

  (a)

Save as otherwise provided by these Articles, a Director shall not vote at a meeting of the Directors or a committee of Directors on any resolution concerning a matter in which he has, directly or indirectly, an interest which is material or a duty which conflicts or may conflict with the interests of the Company. A Director shall not be counted in the quorum present at a meeting in relation to any such resolution on which he is not entitled to vote.

 

  (b)

A Director shall be entitled (in the absence of some other material interest than is indicated below) to vote (and be counted in the quorum) in respect of any resolutions concerning any of the following matters, namely:

 

  (i)

the giving of any security, guarantee or indemnity to him in respect of money lent by him to the Company or any of its subsidiary or associated companies or obligations incurred by him or by any other person at the request of or for the benefit of the Company or any of its subsidiary or associated companies;


  (ii)

the giving of any security, guarantee or indemnity to a third party in respect of a debt or obligation of the Company or any of its subsidiary or associated companies for which he himself has assumed responsibility in whole or in part and whether alone or jointly with others under a guarantee or indemnity or by the giving of security;

 

  (iii)

any proposal concerning any offer of shares or debentures or other securities of or by the Company or any of its subsidiary or associated companies for subscription, purchase or exchange in which offer he is or is to be interested as a participant in the underwriting or sub-underwriting thereof;

 

  (iv)

any proposal concerning any other company in which he is interested, directly or indirectly and whether as an officer or shareholder or otherwise howsoever, provided that he is not the Holder of or beneficially interested in 1% or more of the issued shares of any class of such company or of the voting rights available to members of such company (or of a third company through which his interest is derived) (any such interest being deemed for the purposes of this Article to be a material interest in all circumstances);

 

  (v)

any proposal concerning the adoption, modification or operation of a superannuation fund or retirement benefits scheme under which he may benefit and which has been approved by or is subject to and conditional upon approval for taxation purposes by the appropriate Revenue authorities;

 

  (vi)

any proposal concerning the adoption, modification or operation of any scheme for enabling employees (including full time executive Directors) of the Company and/or any subsidiary thereof to acquire shares in the Company or any arrangement for the benefit of employees of the Company or any of its subsidiaries under which the Director benefits or may benefit; or

 

  (vii)

any proposal concerning the giving of any indemnity pursuant to Article 157(a) or the discharge of the cost of any insurance cover purchased or maintained pursuant to Article 157(b).

 

  (c)

Where proposals are under consideration concerning the appointment (including fixing or varying the terms of appointment) of two or more Directors to offices or employments with the Company or any company in which the Company is interested, such proposals may be divided and considered in relation to each Director separately and in such case each of the Directors concerned (if not debarred from voting under sub-paragraph (b) (iv) of this Article) shall be entitled to vote (and be counted in the quorum) in respect of each resolution except that concerning his own appointment.


  (d)

Nothing in Section 228(1)(e) of the Act shall restrict a director from entering into any commitment which has been approved by the Board or has been approved pursuant to such authority as may be delegated by the Board in accordance with these Articles. It shall be the duty of each Director to obtain the prior approval of the Board, before entering into any commitment permitted by Sections 228(1)(e)(ii) and 228(2) of the Act.

 

  (e)

If a question arises at a meeting of Directors or of a committee of Directors as to the materiality of a Director’s interest or as to the right of any Director to vote and such question is not resolved by his voluntarily agreeing to abstain from voting, such question may be referred, before the conclusion of the meeting, to the chairman of the meeting and his ruling in relation to any Director other than himself shall be final and conclusive. In relation to the Chairman, such question may be resolved by a resolution of a majority of the Directors (other than the Chairman) present at the meeting at which the question first arises.

 

  (f)

For the purposes of this Article, an interest of a person who is the spouse or a minor child of a Director shall be treated as an interest of the Director and, in relation to an alternate Director, an interest of his appointor shall be treated as an interest of the alternate Director.

 

  (g)

The Company by ordinary resolution may suspend or relax the provisions of this Article to any extent or ratify any transaction not duly authorised by reason of a contravention of this Article, provided this is not inconsistent with the Listing Rules.

 

118.

Entitlement to grant pensions

 

  (a)

The Directors may provide benefits, whether by way of pensions, gratuities or otherwise, for any Director, former Director or other officer or former officer of the Company or to any person who holds or has held any employment with the Company or with any body corporate which is or has been a subsidiary or associated company of the Company or a predecessor in business of the Company or of any such subsidiary or associated company and to any member of his family or any person who is or was dependent on him and may set up, establish, support, alter, maintain and continue any scheme for providing all or any such benefits and for such purposes any Director accordingly may be, become or remain a member of, or rejoin, any scheme and receive or retain for his own benefit all benefits to which he may be or become entitled thereunder. The Directors may pay out of the funds of the Company any premiums, contributions or sums payable by the Company under the provisions of any such scheme in respect of any of the persons or class of persons above referred to who are or may be or become members thereof.

 

  (b)

Subject to the provisions of Article 157(b), the Directors shall have the power to purchase and maintain insurance for or for the benefit of any persons who are or were at any time, directors, officers, or employees of the Company, or of any other company which is its holding company or in which the Company or such holding company has any interest whether direct or indirect or which is in any way allied to or associated with the Company, or of any subsidiary undertaking of the Company or any such other company, or who are or were at any time trustees of any pension fund in which employees of the Company, or any other company or such subsidiary undertaking are interested, including (without prejudice to the generality of the foregoing) insurance against any liability incurred by such persons in respect of any act or omission when in the actual or purported execution or discharge of their duties or in the exercise or purported exercise of their powers or otherwise in relation to their duties, powers or offices in relation to the Company or any such other company, subsidiary undertaking or pension fund.


PART XVII - PROCEEDINGS OF DIRECTORS

 

119.

Convening and regulation of Directors’ meetings

 

  (a)

The Directors may meet together for the despatch of business, adjourn and otherwise regulate their proceedings as they think fit. The Chairman or any three Directors may call a meeting of the Directors. Any Director may waive notice of any meeting and any such waiver may be retrospective.

 

  (b)

Notice of a meeting of the Directors or any other notice required to be given to, or by, a Director shall be deemed to be duly given to a Director if it is given to him personally or by word of mouth or sent in writing by delivery, post, cable, telegram, telex, telefax, electronic mail or any other means of communication approved by the Directors to him at his last known address or any other address given by him to the Company for this purpose.

 

120.

Quorum for Directors’ meetings

 

  (a)

The quorum for the transaction of the business of the Directors may be fixed by the Directors and unless so fixed at any other number shall be three Directors.

 

  (b)

A person who holds office only as an alternate Director shall, if his appointor is not present, be counted in the quorum but notwithstanding that such person may act as alternate Director for more than one Director he shall not count as more than one for the purposes of determining whether a quorum is present.

 

  (c)

The continuing Directors or a sole Director may act notwithstanding any vacancies in their number but if the number of Directors is less than the number fixed as the quorum, they may act only for the purpose of filling vacancies or of calling a general meeting.

 

121.

Voting at Directors’ meetings

 

  (a)

Questions arising at any meeting of Directors shall be decided by a majority of votes. Where there is an equality of votes, the chairman of the meeting shall have a second or casting vote.

 

  (b)

Subject as hereinafter provided, each Director present and voting shall have one vote and in addition to his own vote shall be entitled to one vote in respect of each other Director not present at the meeting who shall have authorised him in respect of such meeting to vote for such other Director in his absence. Any such authority may relate generally to all meetings of the Directors or to any specified meeting or meetings and must be in writing and may be sent by delivery, post, cable, telegram, telex, telefax, electronic mail or any other means of communication approved by the Directors and may bear a printed, facsimile, electronic signature or advanced electronic signature of the Director giving such authority. The authority must be delivered to the Secretary for filing prior to or must be produced at the first meeting at which a vote is to be cast pursuant thereto provided that no Director shall be entitled to any vote at a meeting on behalf of another Director pursuant to this paragraph if the other Director shall have appointed an alternate Director and that alternate Director is present at the meeting at which the Director proposes to vote pursuant to this paragraph.


122.

Telecommunication meetings

Any Director or alternate Director may participate in a meeting of the Directors or any committee of the Directors by means of conference telephone or other telecommunications equipment by means of which all persons participating in the meeting can hear each other speak and such participation in a meeting shall constitute presence in person at the meeting.

 

123.

Chairman and Deputy Chairman of the board of Directors

Subject to any appointment to the office of Chairman made pursuant to these Articles, the Directors shall elect a Chairman and a Deputy Chairman from amongst their number and determine the period for which he is to hold office, but if at any meeting the Chairman is unwilling to act or is not present within fifteen minutes after the time appointed for holding such meeting and the Deputy Chairman is unwilling to act or is not present within that time, the Directors present may choose one of their number to be chairman of such meeting.

 

124.

Validity of acts of Directors

All acts done by any meeting of the Directors or of a committee of Directors or by any person acting as a Director, notwithstanding that it be afterwards discovered that there was some defect in the appointment of any such Director or person acting as aforesaid, or that they or any of them were disqualified from holding office or had vacated office, shall be as valid as if every such person had been duly appointed and was qualified and had continued to be a Director and had been entitled to vote.

 

125.

Directors’ resolutions or other documents in writing

A resolution or other document in writing (in electronic form or otherwise) signed (whether by electronic signature, advanced electronic signature or otherwise as approved by the Directors) by all the Directors entitled to vote on the resolution shall be as valid as if it had been passed at a meeting of Directors or (as the case may be) a committee of Directors duly convened and held and may consist of several documents in the like form each signed by one or more Directors, and such resolution or other document or documents when duly signed may be delivered or transmitted (unless the Directors shall otherwise determine either generally or in any specific case) by facsimile transmission, electronic mail or some other similar means of transmitting the contents of documents. A resolution or other documents signed (whether by electronic signature, advanced electronic signature or otherwise as approved by the Directors) by an alternate Director need not also be signed by his appointor and, if it is signed by a Director who has appointed an alternate Director, it need not be signed by the alternate Director in that capacity.


PART XVIII - THE SECRETARY

 

126.

Appointment of secretary

The Secretary shall be appointed by the Directors for such term, at such remuneration and upon such conditions as they may think fit and any Secretary so appointed may be removed by them. Anything required or authorised by the Acts or these Articles to be done by the Secretary may be done, if the office is vacant or there is for any other reason no Secretary readily available and capable of acting, by or to any assistant or acting secretary readily available and capable of acting, by or to any officer of the Company authorised generally or specially in that behalf by the Directors: Provided that any provision of the Acts or these Articles requiring or authorising a thing to be done by or to a Director and the Secretary shall not be satisfied by its being done by or to the same person acting both as a Director and as, or in the place of, the Secretary.

PART XIX - THE SEAL

 

127.

Use of Seal

The Directors shall ensure that the Seal (including any official securities seal kept pursuant to the Acts) shall be used only by the authority of the Directors or of a committee authorised by the Directors or of such other person or persons as are authorised by the board of directors or a committee of the board of directors.

 

128.

Seal for use abroad

The Company may exercise the powers conferred by the Acts with regard to having an official seal for use abroad and such powers shall be vested in the Directors.

 

129.

Signature of sealed instruments

 

  (a)

Every instrument to which the Seal shall be affixed shall be signed by a Director or some person authorised by the Company for that purpose and shall also be signed by the Secretary or by a second Director or by some other person authorised by the Company for that purpose save that as regards any certificates for shares or debentures or other securities of the Company the Directors may determine by resolution that such signatures or either of them shall be dispensed with, or be printed thereon or affixed thereto by some method or system of mechanical signature provided that in any such case the certificate to be sealed shall have been approved for sealing by the Secretary or by the registrar of the Company or by the Auditors or by some other person appointed by the Directors for this purpose in writing (and, for the avoidance of doubt, it shall be sufficient for approval to be given and/or evidenced either in such manner (if any) as may be approved by or on behalf of the Directors or by having certificates initialled before sealing or by having certificates presented for sealing accompanied by a list thereof which has been initialled).


  (b)

For the purposes of this Article 129, any instrument in electronic form to which the seal is required to be affixed, shall be sealed by means of an advanced electronic signature based on a qualified certificate of a Director and the Secretary or of a second Director or by some other person appointed by the Directors for the purpose.

PART XX - DIVIDENDS AND RESERVES

 

130.

Declaration of dividends

Subject to the provisions of the Acts, the Company by ordinary resolution may declare dividends in accordance with the respective rights of the members, but no dividend shall exceed the amount recommended by the Directors.

 

131.

Interim and fixed dividends

Subject to the provisions of the Acts, the Directors may declare and pay interim dividends if it appears to them that they are justified by the profits of the Company available for distribution. If the share capital is divided into different classes, the Directors may declare and pay interim dividends on shares which confer deferred or non-preferred rights with regard to dividend as well as on shares which confer preferential rights with regard to dividend, but subject always to any restrictions for the time being in force (whether under these Articles, under the terms of issue of any shares or under any agreement to which the Company is a party, or otherwise) relating to the application, or the priority of application, of the Company’s profits available for distribution or to the declaration or as the case may be the payment of dividends by the Company. Subject as aforesaid, the Directors may also pay at intervals settled by them any dividend payable at a fixed rate if it appears to them that the profits available for distribution justify the payment. Provided the Directors act in good faith they shall not incur any liability to the Holders of shares conferring preferred rights for any loss they may suffer by the lawful payment of an interim dividend on any shares having deferred or non-preferred rights.

 

132.

Payment of dividends

 

  (a)

Except as otherwise provided by the rights attached to shares, all dividends shall be declared and paid according to the amounts paid up on the shares on which the dividend is paid. All dividends shall be apportioned and paid proportionately to the amounts paid or credited as paid on the shares during any portion or portions of the period in respect of which the dividend is paid; but if any share is issued on terms providing that it shall rank for dividend as from a particular date, such share shall rank for dividend accordingly. For the purposes of this Article, no amount paid on a share in advance of calls shall be treated as paid on a share.

 

  (b)

If several persons are registered as joint Holders of any share, any one of them may give effectual receipts for any dividend or other moneys payable on or in respect of the share.


  (c)

Cash distributions shall be declared in United States dollars, unless the board of Directors determines otherwise and may be paid in such currency or currencies as the board of Directors determines using the rate of exchange prevailing on a date fixed by the board of Directors. The Directors may determine that dividends be paid in more than one currency, depending on the residency of the Holders.

 

133.

Deductions from dividends

The Directors may deduct from any dividend or other moneys payable to any member in respect of a share any moneys presently payable by him to the Company in respect of that share.

 

134.

Dividends in specie

A general meeting declaring a dividend may direct, upon the recommendation of the Directors, that it shall be satisfied wholly or partly by the distribution of assets (and, in particular, of paid up shares, debentures or debenture stock of any other company or in any one or more of such ways) and the Directors shall give effect to such resolution. Where any difficulty arises in regard to the distribution, the Directors may settle the same as they think expedient and in particular may issue fractional certificates and fix the value for distribution of such specific assets or any part thereof in order to adjust the rights of all the parties and may determine that cash payments shall be made to any members upon the footing of the value so fixed.

 

135.

Dividend payment mechanism

 

  (a)

Any dividend or other moneys payable in respect of any share may be paid by cheque or warrant sent by post, at the risk of the person or persons entitled thereto, to the registered address of the Holder or, where there are joint Holders, to the registered address of the joint Holder whose name stands first in the Register in respect of the share or to such person and to such address as the Holder or joint Holders may in writing direct. Every such cheque or warrant shall be made payable to the order of the person to whom it is sent and payment of the cheque or warrant shall be a good discharge to the Company. Any joint Holder or other person jointly entitled to a share may give receipts for any dividend or other moneys payable in respect of the share. Any such dividend or other distribution may also be paid by any other method (including payment in a currency other than United States dollars, electronic funds transfer, direct debit, bank transfer or by means of a relevant system) which the Directors consider appropriate and any member who elects for such method of payment shall be deemed to have accepted all of the risks inherent therein. The debiting of the Company’s account in respect of the relevant amount shall be evidence of good discharge of the Company’s obligations in respect of any payment made by any such methods.

 

  (b)

In respect of shares in uncertificated form, where the Company is authorized to do so by or on behalf of the holder or joint holders in such manner as the Company shall from time to time consider sufficient, the Company may also pay any such dividend, interest or other moneys by means of the relevant system concerned (subject always to the facilities and requirements of that relevant system). Every such payment made by means of the relevant system shall be made in such manner as may be consistent with the facilities and requirements of the relevant system concerned. Without prejudice to the generality of the foregoing, in respect of shares in uncertificated form, such payment may include the sending by the Company or by any person on its behalf of an instruction to the Operator of the relevant system to credit the cash memorandum account of the holder or joint holders .


136.

Dividends not to bear interest

No dividend or other moneys payable in respect of a share shall bear interest against the Company unless otherwise provided by the rights attached to the share.

 

137.

Payment to Holders on a particular date

Any resolution declaring a dividend on shares of any class, whether a resolution of the Company in general meeting or a resolution of the Directors, may specify that the same may be payable to the persons registered as the Holders of such shares at the close of business on a particular date, notwithstanding that it may be a date prior to that on which the resolution is passed, and thereupon the dividend shall be payable to them in accordance with their respective holdings so registered, but without prejudice to the rights inter se of transferors and transferees of any such shares in respect of such dividend. The provisions of this Article shall apply, mutatis mutandis, to capitalisations to be effected in pursuance of these Articles. Any dividend, interest or other sum payable which remains unclaimed for one year after having been declared may be invested or otherwise made use of by the Directors for the benefit of the Company until claimed.

 

138.

Unclaimed dividends

If the Directors so resolve, any dividend which has remained unclaimed for twelve years from the date of its declaration shall be forfeited and cease to remain owing by the Company. The payment by the Directors of any unclaimed dividend or other moneys payable in respect of a share into a separate account shall not constitute the Company a trustee in respect thereof.

 

139.

Reserves

Before recommending any dividend, whether preferential or otherwise, the Directors may carry to reserve out of the profits of the Company such sums as they think proper. All sums standing to reserve may be applied from time to time in the discretion of the Directors for any purpose to which the profits of the Company may be properly applied and at the like discretion may be either employed in the business of the Company or invested in such investments as the Directors may lawfully determine. The Directors may divide the reserve into such special funds as they think fit and may consolidate into one fund any special funds or any parts of any special funds into which the reserve may have been divided as they may lawfully determine. Any sum which the Directors may carry to reserve out of the unrealised profits of the Company shall not be mixed with any reserve to which profits available for distribution have been carried. The Directors may also carry forward, without placing the same to reserve, any profits which they may think it prudent not to divide.


PART XXI – ACCOUNTS

 

140.

Accounts

 

  (a)

The Directors shall, in accordance with Chapter 2 of Part 6 of the Act, cause to be kept adequate accounting records, whether in the form of documents, electronic form or otherwise, that are sufficient to:

 

  (i)

correctly record and explain the transactions of the Company;

 

  (ii)

enable, at any time, the assets, liabilities, financial position and profit or loss of the Company to be determined with reasonable accuracy;

 

  (iii)

enable the Directors to ensure that any financial statements of the Company, required to be prepared under Sections 290 or 293 of the Act, and any directors’ report required to be prepared under Section 325 of the Act, comply with the requirements of the Act and where applicable, Article 4 of Regulation (EC) No. 1606/2002 of the European Parliament and of the Council of 19 July 2002 on the application of international accounting standards; and

 

  (iv)

enable the financial statements of the Company so prepared to be audited.

 

  (b)

The accounting records shall be kept on a continuous and consistent basis, which is to say, the entries in them shall be made in a timely manner and be consistent from one period to the next. Adequate accounting records shall be deemed to have been maintained if they comply with the provisions of Chapter 2 of Part 6 of the Act and explain the Company’s transactions and facilitate the preparation of financial statements that give a true and fair view of the assets, liabilities, financial position and profit or loss of the Company, and, if relevant, the group and include any information and returns referred to in Section 282(3) of the Act.

 

  (c)

The accounting records shall be kept at the registered office or, subject to the provisions of the Act, at such other place as the Directors think fit and shall be open at all reasonable times to the inspection of the Directors.

 

  (d)

The Directors shall determine from time to time whether and to what extent and at what times and places and under what conditions or regulations the accounting records of the Company shall be open to the inspection of members, not being Directors. No member (not being a Director) shall have any right of inspecting any financial statement or accounting records of the Company except as conferred by the Acts or authorised by the Directors or by the Company in general meeting.


  (e)

In accordance with the provisions of the Acts, the Directors shall cause to be prepared and to be laid before the annual general meeting of the Company from time to time such statutory financial statements of the Company and reports as are required by the Acts to be prepared and laid before such meeting.

 

  (f)

A copy of the statutory financial statements of the Company (including every document required by law to be annexed thereto) which is to be laid before the annual general meeting of the Company together with a copy of the Directors’ report and Auditors’ report, or, summary financial statements prepared in accordance with Section 1119 of the Act, shall be sent by post, electronic mail or any other means of electronic communication, not less than twenty-one Clear Days before the date of the annual general meeting, to every person entitled under the provisions of the Acts to receive them; provided that in the case of those documents sent by electronic mail or any other means of electronic communication, such documents shall be sent with the consent of the recipient, to the address of the recipient notified to the Company by the recipient for such purposes and the required number of copies of these documents shall be forwarded at the same time to the appropriate section of the ASX; and provided, where the Directors elect to send summary financial statements to the members, any member may request that he be sent a copy of the statutory financial statements of the Company.

 

  (g)

Auditors shall be appointed and their duties regulated in accordance with the Acts.

PART XXII - CAPITALISATION OF PROFITS OR RESERVES

 

141.

Capitalisation of distributable profits and reserves

 

  (a)

Without prejudice to any powers conferred on the Directors by these Articles, the Company in general meeting may resolve, upon the recommendation of the Directors, that any sum for the time being standing to the credit of any of the Company’s reserves (including any capital redemption reserve fund, any share premium account or any undenominated capital) or to the credit of the profit and loss account be capitalised and applied on behalf of the members who would have been entitled to receive that sum if it had been distributed by way of dividend and in the same proportions either in or towards paying up amounts for the time being unpaid on any shares held by them respectively, or in paying up in full unissued shares or debentures of the Company of a nominal amount equal to the sum capitalised (such shares or debentures to be allotted and distributed credited as fully paid up to and amongst such Holders in the proportions aforesaid) or partly in one way and partly in another, so, however, that the only purposes for which sums standing to the credit of the capital redemption reserve fund, the share premium account or any undenominated capital shall be applied shall be those permitted by the Acts.


  (b)

The Directors may from time to time at their discretion, subject to the provisions of the Acts and, in particular, to their being duly authorised pursuant to the Acts to allot the relevant shares, offer to the Holders of shares the right to elect to receive in lieu of any dividend or proposed dividend or part thereof an allotment of additional shares credited as fully paid. In any such case the following provisions shall apply:

 

  (i)

The basis of allotment shall be determined by the Directors in their absolute discretion.

 

  (ii)

The Directors shall give notice in writing (whether in electronic form or otherwise) to the Holders of shares of the right of election offered to them and shall send with or following such notice forms of election and specify the procedure to be followed and the place at which, and the latest date and time by which, duly completed forms of election must be lodged in order to be effective. The Directors may also issue forms under which Holders may elect in advance to receive new shares instead of dividends in respect of future dividends not yet declared (and, therefore, in respect of which the basis of allotment shall not yet have been determined).

 

  (iii)

The dividend (or that part of the dividend in respect of which a right of election has been offered) shall not be payable on shares in respect of which the right of election as aforesaid has been duly exercised (the “Subject Ordinary Shares”) and in lieu thereof additional shares (but not any fraction of a share) shall be allotted to the Holders of the Subject Ordinary Shares on the basis of allotment determined aforesaid and for such purpose the Directors shall capitalise, out of such of the sums standing to the credit of any of the Company’s reserves (including any capital redemption reserve fund, share premium account or any undenominated capital) or to the credit of the profit and loss account as the Directors may determine, a sum equal to the aggregate nominal amount of additional shares to be allotted on such basis and apply the same in paying up in full the appropriate number of unissued shares for allotment and distribution to and amongst the holders of the Subject Ordinary Shares on such basis.

 

  (c)

The additional shares so allotted shall rank pari passu in all respects with the fully paid shares then in issue save only as regards participation in the relevant dividend or share election in lieu.

 

  (d)

The Directors may do all acts and things considered necessary or expedient to give effect to any such capitalisation with full power to the Directors to make such provisions as they think fit where shares would otherwise have been distributable in fractions (including provisions whereby, in whole or in part, fractional entitlements are disregarded and the benefit of fractional entitlements accrues to the Company rather than to the holders concerned). The Directors may authorise any person to enter on behalf of all the Holders interested into an agreement with the Company providing for such capitalisation and matters incidental thereto and any agreement made under such authority shall be effective and binding on all concerned.

 

  (e)

The Directors may on any occasion determine that rights of election shall not be offered to any Holders of shares who are citizens or residents of any state or territory where the making or publication of an offer of rights of election or any exercise of rights of election or any purported acceptance of the same would or might be unlawful, and in such event the provisions aforesaid shall be read and construed subject to such determination.


142.

Capitalisation of non-distributable profits and reserves

Without prejudice to any powers conferred on the Directors, the Company in general meeting may resolve, on the recommendation of the Directors, that it is desirable to capitalise any part of the amount for the time being standing to the credit of any of the Company’s reserve accounts or to the credit of the profit and loss account which is not available for distribution by applying such sum in paying up in full unissued shares to be allotted as fully paid bonus shares to those members of the Company who would have been entitled to that sum if it were distributable and had been distributed by way of dividend (and in the same proportions) and the Directors shall give effect to such resolution.

 

143.

Implementation of capitalisation issues

Whenever such a resolution is passed pursuant to Articles 141 or 142, the Directors shall make all appropriations and applications of the undivided profits resolved to be capitalised thereby and all allotments and issues of fully paid shares or debentures, if any, and generally shall do all acts and things required to give effect thereto with full power to the Directors to make such provisions as they shall think fit in the case of shares or debentures becoming distributable in fractions (and, in particular, without prejudice to the generality of the foregoing, either to disregard such fractions or to sell the shares or debentures represented by such fractions and distribute the net proceeds of such sale to and for the benefit of the Company or to and for the benefit of the members otherwise entitled to such fractions in due proportions) and to authorise any person to enter on behalf of all the members concerned into an agreement with the Company providing for the allotment to them respectively, credited as fully paid up, of any further shares or debentures to which they may become entitled on such capitalisation or, as the case may require, for the payment up by the application thereto of their respective proportions of the profits resolved to be capitalised of the amounts remaining unpaid on their existing shares and any agreement made under such authority shall be binding on all such members.

PART XXIII – NOTICES

 

144.

Notices in writing

Any notice to be given, served or delivered pursuant to these Articles shall be in writing (whether in electronic form or otherwise) and the Company must comply with ASX Listing Rule 15.10, which requires that any document to be sent to an overseas Security Holder is sent by air or by fax, or in another way that ensures that it will be received quickly.

 

145.

Service of notices

Save as where otherwise provided in these Articles:

 

  (a)

A notice or document (including a share certificate) to be given, served or delivered in pursuance of these Articles may be given to, served on or delivered to any member by the Company:

 

  (i)

by handing same to him or his authorised agent;


  (ii)

by leaving the same at his registered address;

 

  (iii)

by sending the same by the post in a pre-paid cover addressed to him at his registered address; or

 

  (iv)

by sending, with the consent of the member, the same by means of electronic mail or other means of electronic communication approved by the Directors, with the consent of the member, to the address of the member notified to the Company by the member for such purpose (or if not so notified, then to the address of the member last known to the Company).

 

  (b)

Where a notice or document is given, served or delivered pursuant to sub-paragraph (a) (i) or (ii) of this Article, the giving, service or delivery thereof shall be deemed to have been effected at the time the same was handed to the member or his authorised agent, or left at his registered address (as the case may be).

 

  (c)

Where a notice or document is given, served or delivered pursuant to sub-paragraph (a) (iii) of this Article, the giving, service or delivery thereof shall be deemed to have been effected at the expiration of twenty-four hours after the cover containing it was posted. In proving service or delivery it shall be sufficient to prove that such cover was properly addressed, stamped and posted.

 

  (d)

Where a notice or document is given, served or delivered pursuant to sub-paragraph (a)(iv) of this Article, the giving, service or delivery thereof shall be deemed to have been effected at the expiration of 48 hours after despatch.

 

  (e)

Every legal personal representative, committee, receiver, curator bonis or other legal curator, assignee in bankruptcy, examiner or liquidator of a member shall be bound by a notice given as aforesaid if sent to the last registered address of such member, or, in the event of notice given or delivered pursuant to sub-paragraph (a)(iv), if sent to the address notified to the Company by the member for such purpose notwithstanding that the Company may have notice of the death, lunacy, bankruptcy, liquidation or disability of such member.

 

  (f)

Notwithstanding anything contained in this Article the Company shall not be obliged to take account of or make any investigations as to the existence of any suspension or curtailment of postal services within or in relation to all or any part of any jurisdiction or other area other than the State.

 

  (g)

Any requirement in these Articles for the consent of a member in regard to the receipt by such member of electronic mail or other means of electronic communications approved by the Directors, including the receipt of the Company’s audited accounts and the directors’ and auditor’s reports thereon, shall be deemed to have been satisfied where the Company has written to the member informing him/her of its intention to use electronic communications for such purposes and the member has not, within four weeks of the issue of such notice, served an objection in writing on the Company to such proposal. Where a member has given, or is deemed to have given, his/her consent to the receipt by such member of electronic mail or other means of electronic communications approved by the Directors, he/she may revoke such consent at any time by requesting the Company to communicate with him/her in documented form provided however that such revocation shall not take effect until five days after written notice of the revocation is received by the Company.


146.

Service on joint Holders

A notice may be given by the Company to the joint Holders of a share by giving the notice to the joint Holder whose name stands first in the Register in respect of the share and notice so given shall be sufficient notice to all the joint Holders.

 

147.

Service on transfer or transmission of shares

 

  (a)

Every person who becomes entitled to a share shall before his name is entered in the Register in respect of the share, be bound by any notice in respect of that share which has been duly given to a person from whom he derives his title provided that the provisions of this paragraph shall not apply to any notice served under Article 71 unless, under the provisions of Article 71(b), it is a notice which continues to have effect notwithstanding the registration of a transfer of the shares to which it relates.

 

  (b)

Without prejudice to the provisions of these Articles allowing a meeting to be convened by a notice issued, a notice may be given by the Company to the persons entitled to a share in consequence of the death or bankruptcy of a member by sending or delivering it, in any manner authorised by these Articles for the giving of notice to a member, addressed to them at the address, if any, supplied by them for that purpose. Until such an address has been supplied, a notice may be given in any manner in which it might have been given if the death or bankruptcy had not occurred.

 

148.

Signature to notices

The signature (whether electronic signature, an advanced electronic signature or otherwise) to any notice to be given by the Company may be written (in electronic form or otherwise) or printed.

 

149.

Deemed receipt of notices

A member present, either in person or by proxy, at any meeting of the Company or the Holders of any class of shares in the Company shall be deemed to have received notice of the meeting and, where requisite, of the purposes for which it was called.


PART XXIV - WINDING UP

 

150.

Distribution on winding up

If the Company shall be wound up and the assets available for distribution among the members as such shall be insufficient to repay the whole of the paid up or credited as paid up share capital, such assets shall be distributed so that, as nearly as may be, the losses shall be borne by the members in proportion to the capital paid up or credited as paid up at the commencement of the winding up on the shares held by them respectively. And if in a winding up the assets available for distribution among the members shall be more than sufficient to repay the whole of the share capital paid up or credited as paid up at the commencement of the winding up, the excess shall be distributed among the members in proportion to the capital at the commencement of the winding up paid up or credited as paid up on the said shares held by them respectively. Provided that this Article shall not affect the rights of the Holders of shares issued upon special terms and conditions.

 

151.

Sale by a liquidator

 

  (a)

In case of a sale by the liquidator under the Acts, the liquidator may by the contract of sale agree so as to bind all the members for the allotment to the members direct of the proceeds of sale in proportion to their respective interests in the Company and may further by the contract limit a time at the expiration of which obligations or shares not accepted or required to be sold shall be deemed to have been irrevocably refused and be at the disposal of the Company, but so that nothing herein contained shall be taken to diminish, prejudice or affect the rights of dissenting members conferred by the Acts.

 

  (b)

The power of sale of the liquidator shall include a power to sell wholly or partially for debentures, debenture stock, or other obligations of another company, either then already constituted or about to be constituted for the purpose of carrying out the sale.

 

152.

Distribution in specie

If the Company is wound up, the liquidator, with the sanction of a special resolution of the Company and any other sanction required by the Acts, may divide among the members in specie or kind the whole or any part of the assets of the Company (whether they shall consist of property of the same kind or not), and, for such purpose, may value any assets and determine how the division shall be carried out as between the members or different classes of members. The liquidator, with the like sanction, may vest the whole or any part of such assets in trustees upon such trusts for the benefit of the contributories as, with the like sanction, he determines, but so that no member shall be compelled to accept any assets upon which there is a liability.


PART XXV – MISCELLANEOUS

 

153.

Minutes of meetings

The Directors shall cause minutes to be made of the following matters, namely:

 

  (a)

of all appointments of officers and committees made by the Directors and of their salary or remuneration;

 

  (b)

of the names of Directors present at every meeting of the Directors and of the names of any Directors and of all other members thereof present at every meeting of any committee appointed by the Directors; and

 

  (c)

of all resolutions and proceedings of all meetings of the Company and of the Holders of any class of shares in the Company and of the Directors and of committees appointed by the Directors.

Any such minute as aforesaid, if purporting to be signed by the chairman or deputy chairman (if any) of the meeting at which the proceedings were had, or by the chairman or deputy chairman (if any) of the next succeeding meeting, shall be prima facie evidence of the matter stated in such minute without any further proof.

 

154.

Inspection and secrecy

The Directors shall determine from time to time whether and to what extent and at what times and places and under what conditions or regulations the accounts and books of the Company or any of them shall be open to the inspection of members, not being Directors, and no member (not being a Director) shall have any right of inspecting any account or book or document of the Company except as conferred by the Acts and the Listing Rules or authorised by the Directors or by the Company in general meeting. No member shall be entitled to require discovery of or any information respecting any detail of the Company’s trading, or any matter which is or may be in the nature of a trade secret, mystery of trade, or secret process which may relate to the conduct of the business of the Company and which in the opinion of the Directors it would be inexpedient in the interests of the members of the Company to communicate to the public.

 

155.

Destruction of records

The Company shall be entitled to destroy all instruments of transfer which have been registered at any time after the expiration of six years from the date of registration thereof, all notifications of change of address howsoever received at any time after the expiration of two years from the date of recording thereof and all share certificates and dividend mandates which have been cancelled or ceased to have effect at any time after the expiration of one year from the date of such cancellation or cessation. It shall be presumed conclusively in favour of the Company that every entry in the Register purporting to have been made on the basis of an instrument of transfer or other document so destroyed was duly and properly made and every instrument duly and properly registered and every share certificate so destroyed was a valid and effective document duly and properly cancelled and every other document hereinbefore mentioned so destroyed was a valid and effective document in accordance with the recorded particulars thereof in the books or records of the Company. Provided always that:

 

  (a)

the provision aforesaid shall apply only to the destruction of a document in good faith and without notice of any claim (regardless of the parties thereto) to which the document might be relevant;


  (b)

nothing herein contained shall be construed as imposing upon the Company any liability in respect of the destruction of any document earlier than as aforesaid or in any other circumstances which would not attach to the Company in the absence of this Article; and

 

  (c)

references herein to the destruction of any document include references to the disposal thereof in any manner.

 

156.

Untraced shareholders

 

  (a)

The Company shall be entitled to sell at the best price reasonably obtainable any share of a Holder or any share to which a person is entitled by transmission if and provided that:

 

  (i)

for a period of twelve years no cheque or warrant sent by the Company through the post in a pre-paid letter addressed to the Holder or to the person entitled by transmission to the share at his address on the Register or the other last known address given by the Holder or the person entitled by transmission to which cheques and warrants are to be sent has been cashed and no communication has been received by the Company from the Holder or the person entitled by transmission (provided that during such twelve year period at least three dividends shall have become payable in respect of such share);

 

  (ii)

at the expiration of the said period of twelve years by advertisement in a national daily newspaper published in the State (and a national daily newspaper published in the United States of America and Australia and in a newspaper circulating in the area in which the address referred to in sub-paragraph (a)(i) of this Article is located) the Company has given notice of its intention to sell such share;

 

  (iii)

during the further period of three months after the date of the advertisement and prior to the exercise of the power of sale the Company has not received any communication from the Holder or person entitled by transmission; and

 

  (iv)

the Company has first given notice in writing to the NYSE and ASX, respectively of its intention to sell such shares.

 

  (b)

To give effect to any such sale the Company may appoint any person to execute as transferor an instrument of transfer of such share and such instrument of transfer shall be as effective as if it had been executed by the Holder or the person entitled by the transmission to such share. The transferee shall be entered in the Register as the Holder of the shares comprised in any such transfer and he shall not be bound to see to the application of the purchase moneys nor shall his title to the shares be affected by any irregularity in or invalidity of the proceedings in reference to the sale.

 

  (c)

The Company shall account to the Holder or other person entitled to such share for the net proceeds of such sale by carrying all moneys in respect thereof to a separate account which shall be a permanent debt of the Company and the Company shall be deemed to be a debtor and not a trustee in respect thereof for such Holder or other person. Moneys carried to such separate account may be either employed in the business of the Company or invested in such investments as the Directors may think fit, from time to time.


157.

Indemnity and Insurance

 

  (a)

Subject to the Acts every director and secretary (whether past or present) of the Company shall be indemnified by the Company against, and it shall be the duty of the directors out of the funds of the Company to pay, all costs, losses and expenses which any such director or secretary may incur or become liable to by reason of any contract entered into or any act or thing done by him as such director or secretary or in any way in the discharge of his duties. And no director or secretary shall be liable for the acts, receipts, neglects or defaults of any other director or officer, or for joining in any receipt or other act for conformity, or for any loss or expense happening to the Company through the insufficiency or deficiency of title to any property acquired by order of the directors for or on behalf of the Company, or for the insufficiency or deficiency of any security in or upon which any of the moneys of the Company shall be vested, or for any loss or damage arising from the bankruptcy, insolvency or tortious act by any person with whom any moneys securities or effects shall be deposited, or for any other loss, damage or misfortune whatever which shall happen in the execution of the duties of his office or in relation thereto unless the same happen through his own wilful act or default.

 

  (b)

The Directors shall have power to purchase and maintain for or for the benefit of any persons (including themselves) who are or were at any time directors, or other officers of the Company, insurance against any liability incurred by such persons in respect of any act or omission when in the actual or purported execution or discharge of their duties or in the exercise or purported exercise of their powers or otherwise in relation to their duties, powers or offices in relation to the Company and the Directors shall be entitled to vote (and be counted in the quorum) in respect of any resolution concerning the purchase of such insurance.

 

  (c)

Article 157(a) is without prejudice to any agreements entered into by the Company prior to its registration as an Societas Europaea in Ireland which were lawful and permitted by the laws of the Member State where it was registered at the time of entering into such agreements.

 

  (d)

Every employee and such other person as may be deemed by the Directors of the Company to be an agent of the Company shall be indemnified by the Company as if such person was a director of the Company and therefore subject to the limitations of the Acts.

 


I, the person whose name, address and description are subscribed, wish to be formed into a company in pursuance of this memorandum of association (as amended), and I agree to take the number of shares in the capital of the company set opposite my name.

 

 

    Names, addresses and descriptions

    of subscribers

  

Number of shares taken 

by each subscriber 

 

 

RCI Malta Investments Limited

  

50,000,000 shares 

of NLG 0.02 each 

 

 

 

 

 

 

Dated the 26 day of October 1998    
Witness to the above signatures       :             Mr. Martin van Olffen
    Deputy Civil Law Notary,
    Amsterdam.
    The Netherlands

Exhibit 99.10

 

 

James Hardie Industries

Long Term Incentive Plan

Dated 1 August 2006 as amended on 22 August 2008, 21 August 2009,

19 February 2010, 15 June 2010, 13 August 2012 and 14 August 2015

 

 


Long Term Incentive Plan

Contents

 

 

 

General terms

 

     3   

 

 
1   Introduction      3   
1.1   Purpose      3   
1.2   Commencement      3   
1.3   Rules are binding      3   
1.4  

Plan not to limit other arrangements

 

     3   

 

 
2   Invitation, grant and acceptance      3   
2.1   Eligibility      3   
2.2   Invitation may be made      3   
2.3   Form of Invitation      3   
2.4   Participant agrees to be bound      3   
2.5   Application of schedules      4   
2.6   Terms of an Invitation      4   
2.7   When eligibility ceases      4   
2.8  

Cessation of membership

 

     4   

 

 
3   Administration of Plan      5   
3.1   Board to administer Plan      5   
3.2   Board powers and discretions      5   
3.3   Delegation of Board powers and discretions      5   
3.4   Documents      5   
3.5   Board decision: final and conclusive      6   
3.6   Suspension of Plan      6   
3.7   Manner of exercise of Remuneration Committee authority      6   
3.8  

Consultants

 

     7   

 

 
4   Restrictions on the Plan      7   
4.1   Compliance with Applicable Regulations      7   
4.2   Restriction on the size and term of the Plan      7   
4.3   Application of Limitation to Grants      7   
4.4  

Per-Person Award Limitations

 

     8   

 

 
5   Amendment of the Plan      8   
5.1   Board may amend      8   
5.2   No reduction of existing rights      8   
5.3   Retrospective amendment possible      9   
5.4  

Shareholder Approval of Certain Amendments

 

     9   

 

 
6  

Termination of the Plan

 

     9   

 

 
7   Miscellaneous provisions      9   
7.1   Rights of Participants      9   
7.2   Instructions by Participants      10   
7.3   Notices      10   
7.4   Governing law      10   
7.5   Payments net of tax      10   
 

 

 

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7.6   Taxes on transfers to Participants      11   
7.7   Rounding      11   
7.8  

Plan Effective Date and shareholder approval

 

     11   

 

 
8   Definitions and interpretation      11   
8.1   Definitions      11   
8.2   Interpretation      16   
8.3   Heading      17   
Schedule 1 - Award      18   
Schedule 2 – RSUs      25   
Schedule 3 – Provisions applicable only to U.S. Executives      33   
 

 

 

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Long Term Incentive Plan

Contents

 

 

General terms

 

 

 

1 Introduction

 

1.1 Purpose

The Plan provides eligible Executives with an opportunity to acquire an ownership interest or exposure to an ownership interest in the Company.

 

1.2 Commencement

The Plan commences on the date that the Company determines.

 

1.3 Rules are binding

The Company, each Participating Company and each Participant are bound by these rules.

 

1.4 Plan not to limit other arrangements

This Plan is not the sole means by which the Group intends to provide incentives to Participants or other employees of the Group, and nothing in this Plan is intended to restrict the Group from remunerating or otherwise rewarding Participants or other employees outside the Plan.

 

 

2 Invitation, grant and acceptance

 

2.1 Eligibility

The Board may determine the Executives who are eligible to participate in the Plan from time to time.

 

2.2 Invitation may be made

From time to time the Company may make an Invitation to participate in the Plan to an Executive who is eligible to participate in the Plan in accordance with rule 2.1.

 

2.3 Form of Invitation

The Board may determine the manner in which any such Invitation is made and the documentation required to give effect to the Invitation and its acceptance and any grant of an Award or RSU to be made to the Participant.

 

2.4 Participant agrees to be bound

Each Participant is, by accepting an Invitation to participate in the Plan, deemed to have agreed to be bound by:

 

  (a) the terms of the Invitation;
 

 

 

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  (b) the provisions of these rules, as amended from time to time, except the provisions of the schedules apply in accordance with paragraph (d) below;

 

  (c) the Articles of Association, as amended from time to time; and

 

  (d) the provisions of:

 

  (i) schedule 1, to the extent the Participant receives Awards;

 

  (ii) schedule 2, to the extent the Participant receives RSUs; and

 

  (iii) schedule 3, to the extent that the Participant is a U.S. Executive at the time of grant.

 

2.5 Application of schedules

The Company may provide:

 

  (a) Awards on the terms set out in schedule 1;

 

  (b) RSUs on the terms set out in schedule 2; and

 

  (c) Awards or RSUs to a U.S. Executive on the terms set out in schedule 3 (including, to the extent that there is no inconsistency, any terms set out in schedules 1 and 2, respectively which are incorporated into schedule 3).

 

2.6 Terms of an Invitation

An Invitation may not be made on the basis that it is subject to any terms and conditions other than those specified in the Invitation.

 

2.7 When eligibility ceases

A Participant shall not be eligible for the grant of an Award or RSU if at the date of grant:

 

  (a) he or she is not an Executive;

 

  (b) he or she has given their Employer notice of his or her resignation as an Executive; or

 

  (c) he or she has been given notice of termination of employment as an Executive or if, in the opinion of the Board, he or she has tendered his or her resignation to avoid such dismissal.

 

2.8 Cessation of membership

A person ceases to be a Participant when all other property or moneys to which the Participant is entitled under the Plan have been transferred or paid in accordance with these rules. However nothing in this rule prevents the person from receiving a further Invitation or Invitations to participate in the Plan.

 

 

 

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3 Administration of Plan

 

3.1 Board to administer Plan

 

  (a) Unless the Board makes a determination to the contrary, the Plan is to be administered by the Remuneration Committee, in accordance with these rules. In the absence of such a determination by the Board, references in these rules (or in any Invitation issued under these rules) to the Board, except for those provided in rules 3.3, 3.6 and 5, shall be replaced with references to the Remuneration Committee in each such place that it occurs. For the avoidance of doubt, the Remuneration Committee may make further provisions for the operation of the Plan which are consistent with these rules.

 

  (b) Notwithstanding (a), the Remuneration Committee shall administer the Plan and any Invitations with respect to grants of Awards and/or RSUs made to Covered Employees. Furthermore, in respect of such grants of Awards and/or RSUs made to Covered Employees, any references in these rules (or in any Invitation issued under these rules) to the Board, except for those provided in rules 3.3, 3.6 and 5, shall be replaced with Remuneration Committee in each such place that it occurs.

 

3.2 Board powers and discretions

Any power or discretion which is conferred on the Board by these rules must be exercised by the Board in the interests or for the benefit of the Company, and the Board is not, in exercising any power or discretion, under any fiduciary or other obligation to any other person.

 

3.3 Delegation of Board powers and discretions

Subject to rule 3.7, any power or discretion which is conferred on the Board by these rules including the power to invite Executives to participate in the Plan and to determine the terms and conditions of a Participant’s Award or RSU may be delegated by the Board to:

 

  (a) a committee consisting of such directors, other officers or employees of the Company, or any combination of such persons as the Board thinks fit;

 

  (b) a related body corporate of the Company; or

 

  (c) a third party,

for such periods and on such conditions as the Board thinks fit.

 

3.4 Documents

The Company may from time to time require a person invited to participate in the Plan or a Participant to complete and return such other documents as may be required by law to be completed by that person or Participant, or such other documents which the Company considers should, for legal, taxation or administrative reasons, be completed by that person or Participant.

 

 

 

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3.5 Board decision: final and conclusive

The decision of the Board as to the interpretation, effect or application of these rules and all calculations and determination made by the Board under these rules are final, conclusive and binding in the absence of manifest error.

 

3.6 Suspension of Plan

The Board may from time to time suspend the operation of the Plan and may at any time cancel the Plan. The suspension or cancellation of the Plan must not prejudice the existing rights (if any) of Participants.

 

3.7 Manner of exercise of Remuneration Committee authority

 

  (a) The Remuneration Committee, and not the Board, shall exercise sole and exclusive discretion on any matter relating to a Participant then subject to Section 16 of the U.S. Exchange Act with respect to the Company to the extent necessary in order that transactions by that Participant shall be exempt under Rule 16b-3 under the U.S. Exchange Act, and, to the extent the Remuneration Committee determines that the grant and payment of Awards should qualify as “performance-based compensation” for the purposes of U.S. Revenue Code section 162(m), shall exercise any discretion and authority required to allow Awards to so qualify.

 

  (b) Any action of the Remuneration Committee shall be final, conclusive and binding on all persons, including the Company, its Executives, their beneficiaries or other persons claiming rights from or through an Executive, and shareholders.

 

  (c) The express grant of any specific power to the Remuneration Committee, and the taking of any action by the Remuneration Committee, shall not be construed as limiting any power or authority of the Remuneration Committee.

 

  (d) The Remuneration Committee may delegate to officers or managers of the Company, or any committees thereof, the authority (subject to such terms as the Remuneration Committee shall determine), to perform such functions, including administrative functions, as the Remuneration Committee may determine, to the extent that such delegation will not:

 

  (i) result in the loss of an exemption under Rule 16b-3 under the U.S. Exchange Act for Awards or RSUs granted to Participants subject to Section 16 of the U.S. Exchange Act in respect of the Company; or

 

  (ii) cause Awards or RSUs which are intended to qualify as “performance-based compensation” under U.S. Revenue Code Section 162(m) to fail to so qualify.
 

 

 

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3.8 Consultants

If:

 

  (a) a Participant’s employment agreement provides that the Participant will commence as a consultant to a Group Company on ceasing employment with the Company; and

 

  (b) on ceasing employment with the Company, the Participant commences as a consultant to a Group Company in accordance with that agreement,

then, unless the terms of the Participant’s Invitation provide otherwise,

 

  (c) the Participant is deemed to continue as an employee of the Company for the purposes of these rules; and

 

  (d) the Participant will cease to be an employee for the purposes of these rules when the Participant ceases to be a consultant to that Group Company.

 

 

4 Restrictions on the Plan

 

4.1 Compliance with Applicable Regulations

Despite any other provision of these rules or any term or condition of the participation of any Participant in the Plan, no RSU may be granted, no Award may be granted and no Payout may be made if to do so would contravene any Applicable Regulations.

 

4.2 Restriction on the size and term of the Plan

 

  (a) The Board must not issue an Invitation to grant RSUs if the number of Shares the subject of the RSUs when added to the number of Shares which would be issued if all outstanding RSUs vested, but disregarding any Invitation made or Share issued by way of or as a result of an Invitation to a Participant situated outside Australia, at the time of receipt of the relevant Invitation would exceed 5% of the total number of issued Shares at the relevant date.

 

  (b) The term of the Plan shall be limited to ten (10) years from and after the date (if any) that the Company becomes a U.S. Non-exempt Issuer.

 

4.3 Application of Limitation to Grants

 

  (a) No Award or RSU may be granted if:

 

  (i) the number of Shares to be delivered in connection with such Award or RSU; or

 

  (ii) in the case of an Award or RSU relating to Shares but settled only in cash (such as cash-only Awards), the number of Shares to which such Award and/or RSU relates,

exceeds the number of Shares remaining available for delivery under the Plan, minus the number of Shares deliverable in settlement of or relating to then outstanding Awards and/or RSUs.

 

  (b) The Board may adopt reasonable counting procedures to ensure appropriate counting, avoid double counting (as, for example, in the case of tandem or substitute awards) and make adjustments if the number of Shares actually delivered differs from the number of Shares previously counted in connection with an Award and/or RSU.
 

 

 

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4.4 Per-Person Award Limitations

Subject to any adjustments provided for in Schedule 1 or 2 of these rules, if the Company is a U.S. Non-exempt Issuer, then in any financial year of the Company during any part of which the Plan is in effect:

 

  (a) no Participant may be granted Share-settled Awards or RSUs with respect to more than 2 million Shares, and

 

  (b) the maximum dollar value payable to any one Covered Employee with respect to Awards whose Performance Period commences in any one financial year of the Company during any part of which the Plan is in effect is US$5 million .

 

 

5 Amendment of the Plan

 

5.1 Board may amend

Subject to rules 5.2, 5.3 and 5.4, the Board may at any time by written instrument, amend all or any of the provisions of these rules, including this rule 5.

 

5.2 No reduction of existing rights

Any amendment to the provisions of these rules must not materially reduce the rights of any Participant as they existed before the date of the amendment, unless the amendment is introduced primarily:

 

  (a) for the purpose of complying with or conforming to present or future law or regulation governing or regulating the maintenance or operation of the Plan or like plans;

 

  (b) to correct any manifest error or mistake;

 

  (c) to enable contributions or other amounts paid by a member of the Group to the Plan to qualify as income tax deductions for that member or another member of the Group;

 

  (d) to enable any Employer to reduce the amount of fringe benefits tax under the Fringe Benefits Tax Assessment Act 1986 (Cwlth), the amount of tax under the Tax Acts, or the amount of any other tax or impost that would otherwise be payable by the Employer in relation to the Plan;

 

  (e) for the purpose of enabling the Participants generally (but not necessarily each Participant) to receive a more favourable taxation treatment in respect of their participation in the Plan; or

 

  (f) to enable the Plan or any member of the Group to comply with Applicable Regulations.
 

 

 

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5.3 Retrospective amendment possible

Subject to rules 5.2 and 5.4, any amendment made under rule 5.1 may be given retrospective effect as specified in the written instrument by which the amendment is made.

 

5.4 Shareholder Approval of Certain Amendments

In the event that the Board amends:

 

  (a) the limits set forth in rules 4.3 and 4.4 hereof;

 

  (b) the rules set forth in Schedule 3 hereof;

 

  (c) any Awards and/or RSUs that are granted to a U.S. Executive (other than allowed or permitted under this Plan or the terms of the relevant Invitation); and/or

 

  (d) any other rules of this Plan, if so required by the U.S. Revenue Code, the U.S. Exchange Act, the New York Stock Exchange (or other automated quotation system on which the Shares may then be listed or quoted) and/or any other applicable U.S. laws or regulations,

such amendments shall be subject to the approval of the Company’s shareholders not later than the next annual meeting following such Board action.

 

 

6 Termination of the Plan

The Plan terminates and is to be wound up (as provided below) on the earliest of:

 

  (a) if an order is made or an effective resolution is passed for the winding up of the Company other than for the purpose of amalgamation or reconstruction; or

 

  (b) if the Board determines that the Plan is to be wound up.

 

 

7 Miscellaneous provisions

 

7.1 Rights of Participants

Nothing in these rules:

 

  (a) confers on any person any expectation to become a Participant;

 

  (b) confers on any Executive the right to be invited to apply for, to be offered or to receive any Award or RSU;

 

  (c) confers on any Participant the right to continue as an employee of any Employer;

 

  (d) affects any rights which any Employer may have to terminate the employment of any Executive; or

 

  (e) may be used to increase damages in any action brought against any Employer in respect of any termination of employment.
 

 

 

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No person, whether a Participant or otherwise, has any claim, right or interest in respect of the Plan or whether against the Company or any other person, as a consequence of termination of the Executive’s employment or appointment or otherwise, except under and in accordance with these rules.

 

7.2 Instructions by Participants

For the purposes of these rules, the Board, the Company and any Employer is entitled to regard any notice, direction or other communication given or purported to be given by or on behalf of a Participant (or a legal personal representative of a Participant) as valid, whether given orally or in writing. Any notice, direction or other communication given or purported to be given by or on behalf of a Participant (or a legal personal representative of a Participant) or any other person under these rules to the Company or the Employer is duly given only if actually received by the Company or Employer (as the case may be).

 

7.3 Notices

Any notice, certificate, consent, approval, waiver or other communications given by the Board, the Company or the Employer is deemed to have been duly given if:

 

  (a) sent by electronic mail or delivered by hand; or

 

  (b) sent by ordinary prepaid mail,

and is deemed to have been served:

 

  (c) if sent by electronic mail or delivered by hand, at the time of sending or delivery; or

 

  (d) if posted, three Business Days (or, if posted to a Participant’s address outside The Republic of Ireland, seven Business Days) after the date of posting.

Delivery, transmission and postage is to the address of any Participant as indicated on the grant documentation, any other address as the Board or any Participant may notify to the other or in the case of a Participant who is an Executive, the address of the place of business at which the Participant performs the whole or substantially the whole of the duties of his or her office or employment.

 

7.4 Governing law

These rules are governed by the laws in force in the Republic of Ireland and are construed and take effect in accordance with those laws.

 

7.5 Payments net of tax

If, when the Board makes or is deemed to make a payment to a Participant under these rules, the Board is obliged to deduct or withhold any amount of tax or other government levy or impost, the payment to the Participant is to be made net of the deduction or withholding.

 

 

 

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7.6 Taxes on transfers to Participants

The Board may, when transferring Shares to a Participant under these rules, require the Participant to provide the Board with an amount of money which the Board estimates is necessary to meet the Participant’s liability (if any) to pay stamp duty or other taxes in respect of the transfer. Where the Board is provided with funds for that purpose, the Board must apply the funds in payment of the stamp duty or other tax, arrange for registration of the transfer on the Participant’s behalf and return any excess funds to the Participant.

 

7.7 Rounding

Unless expressly provided for in these rules, any calculation of a number of Shares under the Plan is to be rounded to the nearest whole number with 0.5 being rounded up.

 

7.8 Plan Effective Date and shareholder approval

If the Company becomes a U.S. Non-exempt Issuer such that approval of the all or any portion of the Plan or a material amendment thereto is mandatory or desirable under the provisions of:

 

  (a) U.S. Revenue Code Section 162(m) or Rule 16b-3 under the U.S. Exchange Act;

 

  (b) the rules of any stock exchange or automated quotation system on which the Shares may be listed or quoted; or

 

  (c) other laws, regulations, and obligations of the Company applicable to the Plan,

then (i) to the extent necessary, any Awards or RSUs granted to U.S. Executives after such time shall be subject to shareholder approval within the required time and in the required manner; and (ii) if approval of the Plan is required in relation to Awards and/or RSUs, then Awards and/or RSUs may be granted subject to any shareholder approval so required, but may not be exercised or otherwise settled in the event any mandatory shareholder approval is not obtained.

 

 

8 Definitions and interpretation

 

8.1 Definitions

The following words and expressions have the following meanings unless the contrary intention appears:

Acquisition Date means, in relation to a Participant’s Share, the date on which a Participant acquires the Participant’s Share for the purposes of Division 13A of Part III of the Tax Act.

Applicable Regulations means the listing requirements imposed by any exchange or trading system on which the Company’s securities trade and any law or regulation that applies to the operation of the Plan.

Articles of Association means the articles of association of the Company as amended or replaced from time to time.

 

 

 

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ASX means ASX Limited.

ASX Settlement Operating Rules means the operating rules of ASX Settlement Pty Limited.

Award means an entitlement to a Payout.

Award Agreement means the documents referred to in an Invitation which, collectively with the Invitation, set forth the terms and conditions of an Award or RSU.

Board means all or some of the supervising directors of the Company acting as a board, and includes a committee of the Board and a delegate of the Board.

Business Day means a day other than a Saturday, Sunday or public holiday in the Republic of Ireland.

Company means James Hardie Industries Public Limited Company, a company incorporated in Ireland with limited liability.

Control Event means any of the following:

 

  (a) a takeover bid is made to acquire the whole of the issued Shares and the takeover bid is recommended by the Board or becomes unconditional;

 

  (b) a transaction is announced by the Company which, if implemented, would result in a person owning all the issued Shares;

 

  (b) a person owns or controls sufficient Shares to enable them to influence the composition of the Board;

 

  (c) any other similar event has occurred or is likely to occur (including, but not limited to, a merger of the Company with another company), which the Board determines, in its absolute discretion, to be a Control Event.

Corporations Act means the Corporations Act 2001 (Cwlth).

Covered Employee means an Executive who is a “covered employee” within the meaning of Section 162(m)(3) of the U.S. Revenue Code, or any successor provision thereto.

CUFS has the same meaning as in the ASX Settlement Operating Rules, in respect of Shares.

Determination Date means in respect of a Payout the date determined by the Board and set out in the Invitation to the relevant Participant in respect of the Payout.

Effective Date means the date the Plan is approved by the Board, which shall be 1 August, 2006.

 

 

 

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Employer means any Group Company, and in relation to any particular Participant means the company by which that Participant is for the time being employed.

Executive means a person who is in the full time or part time employment of a Group Company.

Fair Market Value means the fair market value of Shares, Awards or other property as determined by the Remuneration Committee, or under procedures established by the Remuneration Committee. Unless otherwise determined by the Remuneration Committee, the Fair Market Value of a Share as of any given date shall be the “Closing Price” (as defined below) of the Share on that reference date. For these purposes the “ Closing Price ” of a Share on any day shall be the closing sale price per Share reported on a consolidated basis for stock listed on the principal stock exchange or market on which Shares are traded on the date immediately preceding the date as of which such value is being determined or, if there is no sale on that date, then on the last previous day on which a sale was reported.

General Meeting has the meaning given in the Articles of Association.

Grant Date means, in relation to a RSU, the date on which that RSU is granted.

Group means the Company and each of its Subsidiaries.

Group Company means the Company or any of its Subsidiaries.

Independent Directors, when referring to either the Board or members of the Remuneration Committee, shall have the same meaning as used in the rules of the New York Stock Exchange or any U.S national securities exchange on which any securities of the Company are listed for trading, and if not listed for trading on any such U.S exchange, by the rules of the New York Stock Market.

Invitation means an invitation to participate in the Plan and thereby to become eligible for the grant of Awards or RSUs under the Plan made in accordance with rule 2.2.

Listing Rules means the Listing Rules of ASX, except to the extent of any express waiver by ASX.

Market Participant has the meaning given in the ASX Settlement Operating Rules.

Market Value means the market value of a Share determined under section 139FA of the Tax Act.

Participant means an Executive to whom an Award or a RSU (as the case may be) has been granted and who has not ceased to be a Participant under rule 2.8 and includes a legal personal representative of the Participant.

Participating Company means each Group Company to which the Board resolves that the Plan extends.

 

 

 

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Payout means the amount calculated in accordance with the formula set out in the Invitation for an Award.

Payout Date means the date on which a Participant receives a Payout, which shall be:

 

  (a) the date determined by the Board and set out in the Invitation to an Executive under paragraph 1 of schedule 1; or

 

  (b) where the Participant qualifies for a Payout under paragraph 3.3(b) of schedule 1, such other date specified by the Board in writing,

and must be within 60 days of the date on which the Participant qualifies for the Payout.

Payout Qualification Condition means, in respect of a Payout, any condition (other than a Payout Vesting Condition) which the Board may impose that must be satisfied or waived for the Participant to have a right to receive that Payout, including satisfaction of a performance hurdle.

Payout Vesting Condition means, in respect of a Payout, a condition which must be satisfied or waived before the right to receive that Payout becomes vested in its holder.

Performance Period means that period established by the Remuneration Committee at the time any Award or RSU is granted or at any time thereafter during which any performance goals specified by the Remuneration Committee with respect to such Award or RSU are to be measured.

Plan means the James Hardie Industries Long Term Incentive Plan as amended from time to time, the rules of which are set out in this document.

Prescribed Qualification Date means, in relation to a Payout, the date on which the Participant qualifies for the Payout subject to the Terms and Conditions of Award for the Payout.

Prescribed Vesting Date means, in relation to a RSU, the first date on which that RSU can vest, subject to the Terms and Conditions of Grant for that RSU.

Redundancy means termination of employment of a Participant by a Participating Company due to economic, technological, structural or other organisational change where through no act or default of the Participant:

 

  (a) the Participating Company no longer requires the duties and responsibilities carried out by the Participant to be carried out by anyone; or

 

  (b) the Participating Company no longer requires the position held by the Participant to be held by anyone.

Remuneration Committee means the Remuneration Committee of the Board, which, if the Company is a U.S. Non-exempt Issuer, shall consist solely of directors who qualify as “outside directors” within the meaning of Section 162(m) of the U.S. Revenue Code, “non-employee directors” within the meaning of Rule 16b-3 under the U.S. Exchange Act, and “independent” where required by Applicable Regulations.

 

 

 

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Reorganisation means any merger, consolidation, reconstruction or other reorganisation in respect of the Company, including any compromise or arrangement for the purposes of or in connection with a scheme for the reconstruction of the Company or its amalgamation with any other company.

Retirement means termination of the employment of a Participant with a Participating Company because:

 

  (a) the Participant attains the age that the Board accepts as the retirement age for that individual;

 

  (b) the Participant is unable, in the opinion of the Board, to perform his or her duties because of illness or incapacity.

Rights means any rights or options to acquire Shares or other securities issued or to be issued by the Company.

RSU means a restricted stock unit which is an unfunded and unsecured contractual entitlement to be issued or transferred a Share on a future date.

Security Interest means a mortgage, charge, pledge, lien or other encumbrance of any nature.

Separation means the termination of a Participant’s employment with a Participating Company by the volition of the Participant.

Shares means fully paid ordinary shares in the capital of the Company .

Subsidiary means an entity that is controlled by the Company.

Supplementary Condition means, in relation to an Award or a RSU, any term or condition (other than the rules, the Exercise Conditions, the Vesting Conditions, the Minimum Restriction Conditions, the Performance Conditions, the Payout Vesting Conditions or the Payout Qualification Conditions) to which that Award or RSU is subject.

Tax Act means the Income Tax Assessment Act 1936 (Cwlth) and the Income Tax Assessment Act 1997 (Cwlth), as the context requires.

Te r ms and Conditions of Award means, in relation to an Award, all of:

 

  (a) these rules (other than the schedules);

 

  (b) the rules of schedule 1;

 

  (c) any Payout Vesting Condition;

 

  (d) any Payout Qualification Condition;

 

  (e) any Supplementary Condition; and

 

  (f) if granted to a U.S. Executive, the rules of Schedule 3
 

 

 

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Terms and Conditions of RSU Grant means, in relation to a RSU, all of:

 

  (a) these rules (other than the schedules); and

 

  (b) the rules of schedule 2;

 

  (c) any Vesting Condition;

 

  (d) any Supplementary Condition; and

 

  (e) if granted to a U.S. Executive, the rules of Schedule 3.

Total Shareholder Return means, in respect of a company in capital value, dividends and other distributions over a specified period of time, as calculated in accordance with the procedure approved by the Board from time to time.

Tranche means: a number of RSUs which have the same Prescribed Vesting Date.

U.S. Exchange Act means the Securities Exchange Act of 1934, as amended from time to time, including rules thereunder and successor provisions and rules thereto.

U.S. Executive means an Executive of the Company who is subject to taxation in respect of Awards or RSUs in the United States.

U.S. Non-exempt Issuer means the Company as of the date it no longer satisfies the qualifications to be classified as a foreign private issuer under Rule 3b-4 of the U.S. Exchange Act.

U.S. Revenue Code means the U.S. Internal Revenue Code of 1986, as amended.

Vesting Condition means, in relation to a RSU, a condition which must be satisfied or waived before that RSU becomes vested in its holder.

Vested Awards means an Award in respect of which Payout Vesting Conditions have been satisfied.

Vested RSU means an RSU in respect of which Vesting Conditions have been satisfied.

 

8.2 Interpretation

In these rules, unless the contrary intention appears:

 

  (a) words importing the singular include the plural and vice versa;

 

  (b) subject to paragraphs (c) and (d), references to these rules, or any particular rule or paragraph of these rules, means these rules, or the relevant rule or paragraph, as amended from time to time;

 

  (c) in a schedule, references to “these rules” and any particular paragraph of these rules exclude the paragraphs of the schedules other than the paragraphs of that schedule;
 

 

 

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  (d) in:

 

  (i) schedule 1, references to the rules includes a reference to any Payout Vesting Condition, any Payout Qualification Condition and any Supplementary Condition;

 

  (ii) schedule 2, references to the rules includes a reference to any Vesting Condition, any Performance Condition and any Supplementary Condition;

 

  (e) references to a statute or other law include regulations and other instruments under it and consolidations, amendments, re-enactments or replacements of any of them;

 

  (f) references to the exercise of a power or discretion include a decision not to exercise the power or discretion;

 

  (g) references to a “year” mean any period of 12 months;

 

  (h) the words “include”, “including” or “such as” are not used as, nor are they to be interpreted as words of limitation, and when introducing a list of items does not exclude a reference to other items whether of the same class or genus or not;

 

  (i) “Australian dollars”, “dollars”, “A$” or “$” is a reference to the lawful currency of Australia;

 

  (j) law means common law, principles of equity, and laws made by parliament (and laws made by parliament include parliamentary laws and regulations and other instruments under them, and consolidations, amendments, re-enactments or replacements of any of them);

 

  (k) a group of persons or things is a reference to any two or more of them jointly and to each of them individually;

 

  (l) if a period of time dates from a given day or the day of an act or event, it is to be calculated exclusive of that day;

 

  (m) if an act under this agreement to be done by a party on or by a given day is done after 5.30pm on that day, it is taken to be done on the next day.

 

8.3 Heading

Headings are for convenience only and, except where they are inserted as a means of cross-reference, do not affect the interpretation of these rules.

 

 

 

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Long Term Incentive Plan

Contents

 

 

Schedule 1 - Award

 

 

 

 

1 Terms applicable to an Award

The grant of an Award to a Participant may be made on such terms and conditions as the Board decides from time to time, including as to:

 

  (a) the Prescribed Qualification Date or how it is calculated;

 

  (b) the Determination Date;

 

  (c) the number of Shares or CUFS on which the Payout will be calculated;

 

  (d) any Payout Vesting Conditions;

 

  (e) any Payout Qualification Conditions;

 

  (f) any Supplementary Conditions; and

 

  (g) the Payout Date.

 

 

2 Grant of Awards

 

2.1 Company to grant Awards

The Company at the discretion of the Board may grant Awards to the Executive specified in the Invitation, subject to the Terms and Conditions of Award.

 

2.2 Notification to Participant

Following the grant of an Award to a Participant under paragraph 2.1, the Company will notify the Participant in writing:

 

  (a) the Prescribed Qualification Date or how it is calculated;

 

  (b) the Determination Date;

 

  (c) the number of Shares or CUFS on which the Payout will be calculated;

 

  (d) the Payout Date; and

 

  (e) other terms and conditions (if any) as determined by the Board.
 

 

 

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2.3 Restrictions on dealing with Awards

A Participant may not sell, assign, transfer or otherwise deal with, or grant a Security Interest over, an Award granted to the Participant. The Award lapses immediately on purported sale, assignment, transfer, dealing or grant of Security Interest, unless the Board in its absolute discretion approves the dealing or the transfer or transmission is effected by force of law on death or legal incapacity to the Participant’s legal personal representative.

 

 

3 Payment of Payouts

 

3.1 Payout Vesting Conditions and Payout Qualification Conditions

Subject to paragraph 4, if a Participant’s Award is subject to Payout Vesting Conditions and/or Payout Qualification Conditions, the Participant will not qualify for payment of the Payout unless all Payout Vesting Conditions and Payout Qualification Conditions are satisfied (and in any situation referred to in paragraph 3.3(b)(i), is satisfied at the time of death or other cessation of employment), and then only to the extent permitted by the Payout Qualification Condition.

 

3.2 Timing of Payment

The Company will pay the Payout to the Participant on or before the Payout Date.

 

3.3 Qualification date

A Participant will qualify for a Payout only on:

 

  (a) the Prescribed Qualification Date for the Payout; or

 

  (b) any earlier date on which the Participant qualifies for the Payout:

 

  (i) under this paragraph 3 dealing with the Participant’s death or otherwise ceasing to be employed by a Group Company, and with situations where the employer ceases to be a Group Company or the business in which the Participant is employed is transferred; or

 

  (ii) under paragraph 4 dealing with takeover bids, change of control, court orders, Reorganisations and winding up.

 

3.4 Award will lapse earlier on death or cessation of employment

A Participant’s Award lapses on the latest of:

 

  (a) the expiry of 24 months after the Participant’s death, if death occurs before the Award lapses under paragraph (b) or (c);

 

  (b) the expiry of 24 months after the Participant ceases to be employed by a Group Company by reason of Retirement or permanent disability; and

 

  (c) the expiry of 3 months after the Participant ceases to be employed by a Group Company for any other reason,
 

 

 

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provided that if the Board issues a notice under paragraph 3.5 or 3.6 advising the Participant that a Vested Award has lapsed, the Award is deemed to have lapsed on the date of death or cessation of employment (as the case may be) and the Company has no obligation to make a Payout in respect of the Vested Award.

 

3.5 Qualification for a Payout on Participant’s death

If a Participant dies before qualifying for a Payout, at a time when the individual:

 

  (a) is still an employee of a Group Company; or

 

  (b) having ceased to be employed by a Group Company, falls within the terms of paragraph 3.6,

then (subject to the other provisions of this paragraph 3), the Participant will:

 

  (c) qualify to receive a Payout in respect of a Vested Award on the date of death except a Vested Award is deemed to have lapsed on the date of death where the Board reasonably determines and provides notice to the Participant in writing that the Vested Award has lapsed and the Company has no obligation to make a Payout in respect of the Vested Award; or

 

  (d) if permitted by the Board in writing, qualify to receive a Payout in respect of an Award that is not a Vested Award on the date of death.

 

3.6 Qualification for a Payout on ceasing to be employed by a Group Company

If, before qualifying for a Payout, a Participant ceases to be employed by a Group Company (other than by reason of his or her death), then (subject to the other provisions of this paragraph 3):

 

  (a) if the employment ceases by reason of Retirement, Redundancy, Separation or otherwise for termination by the relevant Group Company other than in circumstances set out in paragraph 3.9 the Participant will:

 

  (i) qualify to receive a Payout in respect of a Vested Award on the date of cessation of employment, except a Vested Award is deemed to have lapsed on the date of cessation of employment where the Board reasonably determines and provides notice to the Participant in writing that the Vested Award has lapsed and the Company has no obligation to make a Payout in respect of the Vested Award; or

 

  (ii) if permitted by the Board in writing, qualify to receive a Payout in respect of an Award that is not a Vested Award on the date of cessation of employment; or

 

  (b) if the employment ceases for a reason other than Retirement, Redundancy, Separation or otherwise for termination by the relevant Group Company other than in circumstances set out in paragraph 3.9 the Participant is qualified to receive a Payout on the date of cessation, only if permitted by the Board in writing.
 

 

 

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3.7 Individual not treated as ceasing to be an employee

For the purposes of this paragraph 3, a Participant:

 

  (a) is not treated as ceasing to be an employee of a Group Company unless and until the individual is no longer an employee of any Group Company, whether or not in the same capacity as at the time the Award was granted; and

 

  (b) subject to paragraph 3.8, is not treated as ceasing to be an employee of a Group Company if the individual is no longer an employee of any Group Company because:

 

  (i) the individual’s employer ceases to be a Group Company, whether or not, after the cessation, the individual remains an employee of that employer; or

 

  (ii) the individual is an employee of a business that is transferred to a person that is not a Group Company.

3.8      Award lapses if employer ceases to be a Group Company or on change in ownership of business

If a Participant is no longer an employee of a Group Company because of circumstances set out in paragraph 3.7(b)(i) or (ii), then the Awards lapse upon this occurring except where otherwise determined by the Board in writing, in which case the Participant’s Awards lapse on the latest of:

 

  (a) the expiration of 24 months after the date of the cessation or transfer (as the case may be); and

 

  (b) if the Participant dies before the Award lapses under paragraph (a), the expiration of 24 months after the individual’s death.

3.9     Award may lapse in the case of fraud or dishonesty

If, in the opinion of the Board, a Participant:

 

  (a) has committed (or it is evident the Participant intends to commit), any act (whether by omission or commission) which amounts or would amount to any of dishonesty, fraud, wilful misconduct, wilful breach of duty, serious and wilful negligence or incompetence in the performance of the Participant’s duties; or

 

  (b) is convicted of a criminal offence (other than a minor motor traffic offence or other trivial offence which does not impact on the Participant’s good fame and character or ability to perform his/her duties) or is guilty of any other wilful or recklessly indifferent conduct which, in the reasonable opinion of the Board, may injure or tend to injure the reputation and/or the business or operations of a Group Company, the Board may declare that any Award has lapsed, and the Award lapses accordingly.
 

 

 

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3.10 Not qualify for a Payout on bankruptcy

It is a condition precedent to qualification for a Payout that if the Participant is an individual, the Participant is not bankrupt and has not committed an act of bankruptcy or, if the Participant is deceased, the Participant’s estate is not bankrupt or if the Participant is not an individual, the Participant is not insolvent or subject to a resolution or order for winding up.

 

3.11 Ceasing to be an Executive

Where a Participant qualifies for a Payout under this paragraph 3 (other than paragraph 3.3(a)) and paragraph 4, the Board may in its discretion adjust the amount of the Payout pro rata based on the proportion which the period from the date of grant of the relevant Award to the date the Participant ceases to be an Executive bears to the period from the grant date to the Prescribed Qualification Date.

 

3.12 Notice

The Company will notify Participants of any adjustment that will be made to a Payout within a reasonable time of the event which gave rise to the adjustment under paragraph 3.11 occurring.

 

3.13 Discretion to determine that Award will not lapse

Notwithstanding any other paragraph in this Schedule 1, if a Participant ceases employment with the Company for any reason, or gives notice of their intention to cease employment with the Company before the Payout of an Award, the Board may in its absolute discretion (on any conditions which it thinks fit) decide that some or all of the Award does not lapse, but lapses at the time and subject to the conditions it may specify by notice to the Participant, which may include one or more of the following:

 

  (a) that the period to which any Payout Vesting Condition and / or any Payout Qualification Condition relates is reduced to a period shorter than that which would otherwise apply; and

 

  (b) that the Payout Vesting Criteria applicable to an Award be waived.

 

 

4 Takeover, Reorganisation and winding-up

 

4.1 Takeover bid

If a takeover bid is made to acquire any Shares, at any time any offers under a takeover bid remain open for acceptance, the Board may give written notice of the bid to each Participant, stating that the Participant has qualified to receive a Payout on such date specified in the notice.

 

4.2 Application to the court

If the Board determines that an application is to be made to the court under for a meeting to be held as described in paragraph 4.4, the Board may give written notice of the application to each Participant, stating that the Participant has qualified to receive a Payout on such date specified in the notice.

 

 

 

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4.3 Change of control

If, pursuant to a takeover bid or otherwise, any person together with their associates acquire Shares, which when aggregated with Shares already acquired by such person and their associates, comprise more than 30% of the issued Shares of the Company, the Board may give written notice to each Participant stating that the Participant has qualified to receive a Payout on such date specified in the notice.

 

4.4 Meeting to consider a Reorganisation

If, pursuant to the Articles of Association, Applicable Regulations or otherwise, the Board determines to convene a General Meeting or other meeting of holders of the Company’s securities or a meeting of the Company’s creditors, or a court orders a meeting, to be held in relation to a proposed Reorganisation, the Board may give written notice to each Participant stating that the Participant has qualified to receive a Payout on such date specified in the notice.

 

4.5 Compulsory acquisition, Reorganisation or winding up

If:

 

  (a) a person becomes bound or entitled to compulsorily acquire Shares in the Company under the Articles of Association or Applicable Regulations;

 

  (b) a Reorganisation is sanctioned by one or more of the following under the Articles of Association, Applicable Regulations or otherwise:

 

  (i) a court;

 

  (ii) a General Meeting or other meeting of holders of the Company’s securities; or

 

  (c) a meeting of the Company’s creditors; or

 

  (d) the Company passes a resolution for voluntary winding up or an order is made for the compulsory winding up of the Company,

then the Board may give written notice to each Participant stating that the Participant has qualified to receive a Payout on such date specified in the notice.

 

 

5 Adjustments

The Company may, as reasonably determined by the Board, adjust the Payout if any of the following occurs which affects the number of Shares on issue:

 

  (a) a bonus issue of Shares (including an issue by way of a dividend); or

 

  (b) a capital reconstruction of the issued capital of the Company including by a consolidation or sub-division.
 

 

 

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6 Taxes

Payouts shall be reduced by any taxes that are required to be withheld from such payments.

 

 

7 No interest in units or shares

For the avoidance of doubt, nothing in this schedule confers or is intended to confer on a Participant any interest in a unit, share or other security in the Group or any right to acquire a share or other security in the Group or any other body corporate or entity or any right or benefit generally accorded to holders of Shares or CUFS.

 

 

 

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Long Term Incentive Plan

Contents

 

 

Schedule 2 – RSUs

 

 

 

 

1 Grant of RSUs

A grant of RSUs may be on such terms and conditions as the Board decides from time to time, including as to:

 

  (a) the number of RSUs or the method of calculating the number of RSUs to be granted;

 

  (b) the amount payable (if any) for the grant of an RSU or how it is calculated;

 

  (c) whether the RSUs will vest as CUFS or Shares;

 

  (d) any Vesting Condition; and

 

  (e) any Supplementary Condition.

 

 

2 Grant of RSUs

 

2.1 Company to grant RSUs

The Company at the discretion of the Board may grant RSUs to the Executive specified in the Invitation, subject to the Terms and Conditions of RSU Grant.

 

2.2 Certificate or statement

Following the grant of RSUs under paragraph 2.1, the Company will issue to the Participant a certificate and/or other document that states or together state with respect to that grant:

 

  (a) the number of RSUs granted;

 

  (b) the Grant Date;

 

  (c) where the RSUs are comprised in two or more Tranches, the number of RSUs in each Tranche;

 

  (d) the vesting period;

 

  (e) other terms and conditions (if any) as determined by the Board.
 

 

 

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2.3 Restrictions on dealing with RSUs

A Participant may not sell, assign, transfer or otherwise deal with, or grant a Security Interest over, an RSU granted to the Participant. The RSU lapses immediately on purported sale, assignment, transfer, dealing or grant of Security Interest, unless the Board in its absolute discretion approves the dealing, or the transfer or transmission is effected by force of law on death or legal incapacity to the Participant’s legal personal representative.

 

 

3 Register of RSUs

Unless the Board determines otherwise, RSUs granted under these rules (and Shares or CUFS issued or transferred on their vesting) will be registered in the appropriate register of the Company.

 

 

4 Operation of RSUs

 

4.1 Terms and Conditions

Unless otherwise prohibited from doing so under this paragraph 4, a Participant may be granted a Participant’s RSU in accordance with the Terms and Conditions of RSU Grant.

No consideration will be payable on the grant of an RSU unless otherwise specified in the Terms and Conditions of RSU Grant.

 

4.2 Vesting Conditions

Subject to paragraph 6, if an RSU is subject to a Vesting Condition, it may not vest unless all Vesting Conditions are satisfied (and in any situation referred to in paragraph 4.3(b)(i), is satisfied at the time of death or other cessation of employment).

 

4.3 Vesting date

An RSU will vest only on or after:

 

  (a) the Prescribed Vesting Date for the RSU; or

 

  (b) any earlier date on which the RSU vests:

 

  (i) under this paragraph 4 dealing with the Participant’s death or otherwise ceasing to be employed by a Group Company, and with situations where the employer ceases to be a Group Company or the business in which the Participant is employed is transferred; or

 

  (ii) under paragraph 6 dealing with takeover bids, change of control, court orders, Reorganisation and winding up.

 

 

4.4 RSU will lapse earlier on death or cessation of employment

Unless an RSU vests at an earlier date or the Terms and Conditions of RSU Grant provide otherwise, in the event of death, Retirement, Redundancy, Separation or otherwise for termination by the relevant Group Company other than in circumstances set out in paragraph 4.9 by the Participant, a pro-rata number of the Participant’s unvested RSUs will lapse automatically on the relevant day, calculated based on the formula:

D = C x (A / B)

 

 

 

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Where:

A = the number of months from the relevant event to, depending on the type of RSU, the date of vesting (for RSUs with time vesting) or the first testing date (for RSUs with a performance hurdle);

B = depending on the type of RSU, the vesting period calculated in months (for RSUs with time vesting) or the number of months from the date the RSU was granted until the first testing date (for RSUs with a performance hurdle);

C = the number of RSUs in the relevant tranche; and

D = the number of RSUs which lapse automatically.

Unless the remaining RSUs vest at an earlier date or the Terms and Conditions of RSU Grant provide otherwise, a Participant’s remaining RSUs will lapse on the earlier of:

 

  (a) the expiry of 24 months after the Participant’s death, or the Participant ceases to be employed by a Group Company by reason of Retirement or permanent disability; and

 

  (b) the date they would have expired had the Participant remained employed,

provided that if the Board issues a notice under paragraph 4.5 or 4.6 advising the Participant that a RSU has lapsed, the RSU is deemed to have lapsed on the date of death or cessation of employment (as the case may be) and the Company has no obligation to issue or transfer the Shares to which the RSU relates following any purported vesting of the RSU.

 

4.5 Vesting of RSUs on Participant’s death

If a Participant dies before an RSU vests, at a time when the individual:

 

  (a) is still an employee of a Group Company; or

 

  (b) having ceased to be employed by a Group Company, falls within the terms of paragraph 4.6,

then (subject to the other provisions of this paragraph 4):

 

  (c) the Participant may be entitled to the vesting of an RSU at any time from the date of death until it lapses pursuant to paragraph 4.4, except a RSU is deemed to have lapsed on the date of death where the Board reasonably determines and provides notice to the Participant in writing that the RSU has lapsed and the Company has no obligation to issue or transfer the Shares to which the RSU relates; or

 

  (d) if permitted by the Board in writing, an RSU that is not a Vested RSU may vest at any time from the date of death until it lapses.
 

 

 

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4.6 Vesting of an RSU on ceasing to be employed by a Group Company

If a Participant ceases to be employed by a Group Company (other than by reason of his or her death), then (subject to the other provisions of this paragraph 4):

 

  (a) if the employment ceases by reason of Retirement, Redundancy, Separation or in the circumstances set out in paragraph 4.7 or otherwise for termination by the relevant Group Company other than in circumstances set out in paragraph 4.9:

 

  (i) the Participant may be entitled to a Vested RSU at any time from the date of cessation of employment until it lapses pursuant to paragraph 4.4, except a RSU is deemed to have lapsed on the date of cessation of employment where the Board reasonably determines and provides notice to the Participant in writing that the RSU has lapsed and the Company has no obligation to issue or transfer the Shares to which the RSU relates following any purported vesting of the RSU; or

 

  (ii) then if permitted by the Board in writing, a RSU that is not a Vested RSU may vest from the date of cessation of employment until it lapses; or

 

  (b) if the employment ceases for a reason other than Retirement, Redundancy, Separation or in the circumstances set out in paragraph 4.7 or otherwise for termination by the relevant Group Company other than in circumstances set out in paragraph 4.9 any unvested RSU will lapse automatically.

 

4.6A Lapsed RSUs do not vest

Notwithstanding any other provisions of these rules, a RSU which has lapsed will not vest.

 

4.7 Individual not treated as ceasing to be an employee

For the purposes of this paragraph 4, a Participant:

 

  (a) is not treated as ceasing to be an employee of a Group Company unless and until the individual is no longer an employee of any Group Company, whether or not in the same capacity as at the time the RSU was granted; and

 

  (b) and subject to paragraph 4.8, a Participant is not treated as ceasing to be an employee of a Group Company if the individual is no longer an employee of any Group Company because:

 

  (i) the individual’s employer ceases to be a Group Company, whether or not, after the cessation, the individual remains an employee of that employer; or

 

  (ii) the individual is an employee of a business that is transferred to a person that is not a Group Company.
 

 

 

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4.8     RSU lapses if employer ceases to be a Group Company or on change in ownership of business

If a Participant is no longer an employee of a Group Company because of the occurrence of either of the circumstances set out in paragraph 4.7(b)(i) or 4.7(b)(ii), the Participant’s RSUs lapse on the basis set out in paragraph 4.4, as if the applicable circumstance in paragraph 4.7(b)(i) or (4.7(b)(ii) was the death, Retirement, Redundancy, Separation or other termination of the Participant’s employment by the relevant Group Company.

 

4.9 RSU may lapse in the case of fraud, dishonesty or voluntary resignation

If a Participant:

 

  (a) in the opinion of the Board has committed (or it is evident the Participant intends to commit), any act (whether by omission or commission) which amounts or would amount to any of dishonesty, fraud, wilful misconduct, wilful breach of duty, serious and wilful negligence or incompetence in the performance of the Participant’s duties; or

 

  (b) in the opinion of the Board is convicted of a criminal offence (other than a minor motor traffic offence or other trivial offence which does not impact on the Participant’s good fame and character or ability to perform his/her duties) or is guilty of any other wilful or recklessly indifferent conduct which, in the reasonable opinion of the Board, may injure or tend to injure the reputation and/or the business or operations of a Group Company; or

 

  (c) resigns voluntarily from a Group Company,

the Board may declare that any unvested RSU has lapsed, and the RSU lapses accordingly.

 

4.10 No vesting of RSU on bankruptcy

It is a condition precedent to the vesting of a RSU that if the Participant is an individual, the Participant is not bankrupt and has not committed an act of bankruptcy or, if the Participant is deceased, the Participant’s estate is not bankrupt or if the Participant is not an individual, the Participant is not insolvent or subject to a resolution or order for winding up.

 

4.11 Discretion to determine that RSU will not lapse

Notwithstanding any other paragraph in this Schedule 2, if a Participant ceases employment with the Company for any reason, or gives notice of their intention to cease employment with the Company, subject to the provisions in Schedule 3, if applicable, or the Company which employs a Participant ceases to be a Group Company for any reason, the Board or the Remuneration Committee may in its absolute discretion (on any conditions which it thinks fit) decide that some or all of the unvested RSUs held by the Participant do not lapse, but lapse at the time and subject to the conditions it may specify by notice to the Participant, which may include one or more of the following:

 

  (a) that the period to which any Vesting Condition relates is reduced to a period shorter than that which would otherwise apply;
 

 

 

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  (b) that any Vesting Condition is waived or modified; and

 

  (c) that a RSU which vests in accordance with the terms and conditions specified in the notice may vest within the period specified in paragraph 4.4 or any shorter period specified in the notice.

 

 

5 Delivery of Shares on vesting of RSUs

 

5.1 Issue or transfer

Subject to this paragraph 5.1 and paragraphs 5.4 and 5.5, within 15 Business Days after the vesting of a Participant’s RSU the Company will issue or transfer to the Participant the number of Shares comprised in each RSU (expressed to four decimal places) multiplied by the number of RSUs vested by that Participant rounded down to the nearest whole number of Shares. The Board may, in the case of an Executive who is also a member of the Board, prescribe in the Terms and Conditions of RSU Grant that the Shares to be delivered must be acquired by the Company and transferred to the Participant rather than being issued by the Company. Subject to the Listing Rules, if a Participant requests that they are allocated CUFS in respect of the Shares to be issued or transferred, the Company will do everything practicable to promptly facilitate the issue or transfer of CUFS to the Participant in respect of those Shares.

 

5.2 Shares issued by the Company to rank pari passu

All Shares issued on the vesting of a Participant’s RSUs will rank pari passu in all respects with the Shares of the same class for the time being on issue except for any rights attaching to the Shares by reference to a record date prior to the date of their allotment.

 

5.3 Shares to be quoted on ASX

If Shares of the same class as those issued or transferred on the vesting of a Participant’s RSUs are quoted on the ASX, the Company will apply to the ASX as required by the Listing Rules for those Shares to be quoted.

 

5.4 Restriction as to dealing

Where the Shares referred to in paragraph 5.1 are subject (pursuant to the Terms and Conditions of RSU Grant) to any restriction as to disposal or other dealing by the Participant for any period, the Board may implement any procedure it deems appropriate that complies with Applicable Regulations to ensure compliance by the Participant with this restriction.

 

5.5 Participant’s agreement

By accepting an Invitation and being granted RSUs under these rules, each Participant undertakes that while the Shares acquired by the Participant as a result of the vesting of RSUs are subject to any restriction procedure prescribed under paragraph 5.4, the Participant will not take any action or permit another person to take any action to remove the restriction procedure.

 

5.6 Expiry of restriction

Upon the expiry of any restriction over a Share, the Company will take all actions necessary to ensure that the Participant can deal with the Share.

 

 

 

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6 Takeover, Reorganisation and winding-up

 

6.1 RSUs may vest at a time earlier than the Prescribed Vesting Date

Subject to the provisions in Schedule 3, if applicable, if, under any of the following provisions of this paragraph 6 (in connection with a takeover bid, change of control, proposed Reorganisation or winding up) the Board, in its absolute discretion, gives notice that any or all of the Participant’s RSUs may vest as determined by the Board within a particular time, then, subject to the applicable provisions of paragraph 4 (except paragraph 4.2), the RSUs may vest within that time in addition to any other period during which the RSUs vest.

 

6.2 Change of control

If, pursuant to a takeover bid or otherwise, a Control Event occurs prior to vesting of RSUs:

 

  (a) the Board may determine in its absolute discretion, and subject to any conditions that it determines, that all or a portion of the RSUs have vested; and

 

  (b) any RSUs held by a Participant which the Board has not accelerated so that they are vested following a Control Event will lapse, and the Participant will be treated as having never held any right or interest in those RSUs.

 

6.3 Compulsory acquisition, Reorganisation or winding up

If:

 

  (a) a person becomes bound or entitled to compulsorily acquire Shares under the Articles of Association or Applicable Regulations;

 

  (b) a Reorganisation is sanctioned by one or more of the following under the Articles of Association, Applicable Regulations or otherwise:

 

  (i) a court;

 

  (ii) a General Meeting or other meeting of holders of the Company’s securities; or

 

  (iii) a meeting of the Company’s creditors; or

 

  (c) the Company passes a resolution for voluntary winding up or an order is made for the compulsory winding up of the Company,

then the Board may vest RSUs within a specified period of up to 30 days after the occurrence of the relevant event.

 

 

 

7 Adjustment of RSUs

 

7.1 No bonus issue

Subject to the preceding paragraphs, during the currency of a Participant’s RSU and before its vests, the Participant is not entitled to participate in any bonus issue of Shares pro rata to shareholders of securities of the Company as a result of holding the RSU.

 

 

 

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7.2 Sub-division, consolidation, reduction or return

If there is any reorganisation, including any subdivision, consolidation, reduction or return of the issued capital of the Company, the number of RSUs to which each Participant is entitled will be adjusted in the way specified by the Listing Rules for options from time to time.

 

7.3 No right to participate in new issues

Subject to the preceding paragraphs, during the currency of a Participant’s RSU and before its vests, the Participant is not entitled to participate in any new issue of securities of the Company as a result of holding the RSU.

 

7.4 Cumulation of adjustments

Full effect must be given to these paragraphs 7.1, 7.2 and 7.3 as and when occasions of their application arise and in such manner that the effects of the successive applications of them are cumulative, the intention being that the adjustments they progressively effect must be such as to reflect in relation to the Shares comprised in an RSU the adjustments which on the occasions in question are progressively effective in relation to Shares already on issue. All adjustment calculations are to be to four decimal places.

Unless otherwise provided in these rules, a Participant has no right to change the number of Shares over which the RSU vests.

 

 

 

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Long Term Incentive Plan

Contents

 

 

Schedule 3 – Provisions applicable only to U.S. Executives

 

 

 

 

1 General

 

  (a) Notwithstanding any provision of the Plan (including any Schedules thereto) or any Invitation to the contrary, the terms and conditions specified in this Schedule 3 shall apply to all Invitations for Awards and to all RSUs granted to each Participant who is a U.S. Executive at the time of the grant.

 

  (b) The provisions of this Schedule 3 incorporate the provisions of Schedules 1 and 2 except that, in the event of any conflict between a term and/or condition of the Plan (or any Invitation or Award Agreement) and this Schedule 3, the provisions of this Schedule 3 shall prevail to the extent of the conflict.

 

 

2 Awards and RSUs

 

2.1 Additional terms and conditions

The Board is authorized to grant Awards and RSUs to any U.S. Executive in accordance with Schedules 1 and 2, respectively, and including the following terms and conditions:

 

  (a) Compliance with Section 409A . Grants of Awards and/or RSUs under the Plan are intended to be exempt from the requirements of Section 409A by qualifying for the Short Term Deferral Exemption, and the Plan shall be construed in a manner consistent with the requirements for such exemption. If and to the extent that the grant of Awards and/or RSUs under the Plan are not deemed to qualify for the short-term deferral exception, then the Plan and any Invitations for Awards and/or RSUs granted pursuant to the Plan, including the Award Agreements shall be construed in a manner consistent with the requirements of Section 409A, and the Remuneration Committee may amend the Plan and/or any such Invitations to the extent necessary or appropriate to comply with those requirements, without obtaining shareholder or Participant approval.
 

 

 

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  (b) Schedule 3 Definitions. The following definitions shall apply with respect to Awards and RSUs granted to U.S. Executives and shall supersede similar definitions elsewhere in the Plan:

 

  (i) Short Term Deferral Exception means an exception to the applicability of U.S. Code Section 409A that will apply with respect to an Award or RSU, provided that, to the extent the Substantial Risk of Forfeiture has lapsed, the Award or RSU is settled during the period beginning with the date of lapse of the Substantial Risk of Forfeiture with respect to all or the applicable part the Award or RSU and ending two and one half (2-1/2) months after the later of (A) the last day of the calendar year in which, or (B) the last day of the Company’s financial year in which such Substantial Risk of Forfeiture lapses (the “Short Term Deferral Period”).

 

  (ii) Substantial Risk of Forfeiture means such term as defined in U.S. Treasury Regulation Section 1.409A-1(d). For avoidance of doubt, a Substantial Risk of Forfeiture may lapse prior to the date the Award or RSU becomes vested.

 

 

3 Certain Provisions Applicable to Awards and RSUs

Each Award and RSU granted to a U.S. Executive shall be subject to the following additional provisions:

 

  (a) Term . The term of each Award and RSU shall be for such period as may be determined by the Board.

 

  (b) Time, Form, and Method of Settlement . The terms and conditions applicable to Awards and RSUs shall be set forth in the Invitation and the Award Agreements, including the time or times at which or the circumstances under which an RSU may be withdrawn and/or Award may be earned in whole or in part (including based on achievement of performance goals and/or future service requirements), the time or times at which such Award and/or RSU shall lapse, expire, become vested or be forfeited (as the case may be) following a Participant ceasing to be employed by a Group Company or upon other conditions, the form of settlement of the Award or RSU, including, without limitation, cash, Shares or other property not providing for deferral of Shares or Payout and, subject to (c), the methods by or forms in which Shares will be delivered or deemed to be delivered to Participants.

 

  (c) Form and Timing of Payment . Subject to the terms of the Plan and any applicable Invitation or Award Agreement, payments to be made by the Company upon the settlement of an Award or RSU shall be made at such time or times as are specified in the applicable Invitation or Award Agreement. The Invitation or the Award Agreements shall preclude the exercise of discretion by the Company, the Board, the Committee and the Participant to change the time or form of Payout or settlement if the exercise of such discretion would cause the Award or RSU to become subject to additional U.S federal income taxes under U.S. Code Section 409A.
 

 

 

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  (d) Exemptions from Section 16(b) Liability . It is the intent of the Company that, if the Company is a U.S. Non-exempt Issuer, the grant of any Awards and RSUs to (and/or any other transactions pursuant to the Plan with) an Executive who is subject to Section 16 of the U.S. Exchange Act shall be exempt from Section 16 pursuant to an applicable exemption (except for transactions acknowledged in writing to be non-exempt by the Remuneration Committee or such Executive). Accordingly, if any provision of this Plan or any Invitation does not comply with the requirements of Rule 16b-3 under the U.S. Exchange Act then applicable to any such transaction, such provision shall be construed or deemed amended to the extent necessary to conform to the applicable requirements of Rule 16b-3 so that such Executive shall avoid liability under Section 16(b).

 

  (e) U.S. Revenue Code Section 162(m) Provisions

 

  (i) Covered Employees . The Remuneration Committee, in its discretion, may determine at the time an Award or RSU is granted to an Executive who is, or is likely to be, as of the end of the tax year in which the Company would claim a tax deduction in connection with such Award or RSU, a “Covered Employee,” that the provisions of this paragraph 3(f) shall be applicable to such Award or RSU.

 

  (ii) Performance Criteria . If an Award or RSU is subject to this paragraph 3(f), then the lapsing of restrictions thereon and the distribution of cash, Shares or other property pursuant thereto, as applicable, shall be contingent upon achievement of one or more objective performance goals. Performance goals shall be objective and shall otherwise meet the requirements of Section 162(m) of the U.S. Revenue Code and regulations thereunder including the requirement that the level or levels of performance targeted by the Remuneration Committee result in the achievement of performance goals being “substantially uncertain.” One or more of the following business criteria for the Company, on a consolidated basis, or for business or geographical units, or products, of the Company (except with respect to the total shareholder return and earnings per share criteria), shall be used by the Remuneration Committee in establishing performance goals for such Awards and RSUs: (1) earnings per share; (2) revenues or margins; (3) cash flow; (4) operating margin; (5) return on net assets, investment, capital, or equity; (6) economic value added; (7) direct contribution; (8) net income; pre-tax earnings; earnings before interest and taxes; earnings before interest, taxes, depreciation and amortization; earnings after interest expense and before extraordinary or special items; operating income; income before interest income or expense, unusual items and income taxes, local, state or federal and excluding budgeted and actual bonuses which might be paid under any ongoing bonus plans of the Company; (9) working capital; (10) management of fixed costs or variable costs; (11) identification or consummation of investment opportunities or completion of specified projects in accordance with corporate business plans, including growing the sales of differentiated products, strategic mergers, acquisitions or divestitures; (12) total shareholder return; (13) credit facility and liquidity management; (14) market share; (15) entry into new markets, either geographically or by business unit; (16) customer retention and satisfaction; (17) strategic plan development and implementation, including turnaround plans; (18) the Fair Market Value of a Share; (19) primary demand growth or growth against “wood look” products; (20) achievement of environmental/waste goals; (21) achievement of safety goals; (22) resolution of legacy issues; (23) achievement of talent development/management goals; and/or (24) improving manufacturing efficiency. Any of the above goals may be determined on an absolute or relative basis or as compared to the performance of a published or special index deemed applicable by the Remuneration Committee including, but not limited to, the Standard & Poor’s 500 Stock Index or a group of companies that are comparable to the Company. The Remuneration Committee shall exclude the impact of an event or occurrence which the Remuneration Committee determines should appropriately be excluded, including without limitation (i) restructurings, discontinued operations, extraordinary items, and other unusual or non-recurring charges, (ii) an event either not directly related to the operations of the Company or not within the reasonable control of the Company’s management, or (iii) a change in accounting standards required by generally accepted accounting principles.
 

 

 

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  (iii) Performance Period; Timing For Establishing Performance Goals . Achievement of performance goals in respect of Performance Awards shall be measured over a Performance Period no shorter than 12 months and no longer than five years, as specified by the Remuneration Committee. Performance goals shall be established not later than 90 days after the beginning of any Performance Period applicable to such Performance Awards, or at such other date as may be required or permitted for “performance-based compensation” under U.S. Revenue Code Section 162(m).

 

  (iv) Adjustments . The Remuneration Committee may, in its discretion, reduce the amount of a settlement otherwise to be made in connection with Awards or RSUs subject to this paragraph 3(f), but may not exercise discretion to increase any such amount payable to a Covered Employee in respect of an Award or RSU subject to this paragraph 3(f). The Remuneration Committee shall specify the circumstances in which such Awards shall be paid or forfeited in the event of termination of the Executive’s employment prior to the end of a Performance Period or prior to settlement of Awards or RSUs.

 

  (v) Remuneration Committee Certification . No Executive shall receive any payment under the Plan that is subject to this paragraph 3(f) unless the Remuneration Committee has certified, by resolution or other appropriate action in writing, that the performance criteria and any other material terms previously established by the Remuneration Committee or set forth in the Plan, have been satisfied to the extent necessary to qualify as “performance based compensation” under U.S. Revenue Code Section 162(m).
 

 

 

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