ar7225 m&s notice of meeting 2007...ian dyson and steven holliday are retiring and seeking...

Notice of Annual General Meeting 2007Earls Court 2, London, SW5 9TATuesday 10 July 2007 at 2pm

This document is important and requires your immediate attention

THIS DOCUMENT IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION. If you are in any doubt about its contents or the action you should take, you should consult your stockbroker, solicitor,accountant or other independent adviser authorised under the Financial Services and Markets Act 2000.

If you have sold or transferred all your ordinary shares in Marks and Spencer Group plc (the ‘Company’), please handthis document (together with the accompanying Proxy form) as soon as possible to the stockbroker or other agentthrough whom you made the sale or transfer for transmission to the purchaser.

Dear Shareholder, Annual General Meeting (‘AGM’) I have pleasure in sending you the Notice of this year’sAGM which will be held at Earls Court 2, London, SW5 9TA on Tuesday 10 July 2007 at 2pm. The AGM is the Board’s opportunity to present the Company’sperformance and strategy to shareholders and to listenand respond to your questions. If you cannot attend themeeting, we would still like to understand the themes andissues of concern to you, as shareholders. A reply-paidcard is included with this booklet for this purpose or, ifyou prefer, you may send your comments by e-mail [email protected], with the headingAGM 2007.

Your Vote Counts Your vote is important to us – you can:

• register your Proxy vote electronically by logging on to our Registrars’ website, www.sharevote.co.uk, or by using the service offered by CRESTCo for membersof CREST; or

• complete and return the enclosed Proxy form; or

• attend and vote at the AGM.

Voting The accompanying Proxy form invites you to vote in oneof three ways: ‘For’, ‘Against’ or ‘Vote withheld’ for each of the resolutions.

Since 2004, voting at the meeting has been conducted on a poll using the electronic Votenow system, rather than a show of hands. This gives a more democraticresult as all shares represented at the meeting and thoselodged before the meeting are included on a one shareone vote basis. All resolutions are voted separately usingthree-way voting.

The results will be published on our website, together with a resumé of the meeting, and will be released to theLondon Stock Exchange. In 2006, all resolutions werepassed at the meeting on a poll with votes ‘For’ eachresolution ranging from 86% to 99%.

Explanatory Notes Resolution 2 – Approval of the Directors’ Remunerationreport The directors’ Remuneration report is summarised onpages 36-41of the Annual review and set out in full onpages 44-50 of the Annual report. It has been prepared inaccordance with the Directors’ Remuneration ReportRegulations 2002.

Resolutions 4 to 6 – (Re-)election of directors Biographical details of our directors are given on page 27 of the Annual review and the Annual report. The Chairman concludes that each non-executive directoris independent in character and judgement and following a process of formal evaluation confirms that each makesan effective and valuable contribution to the Board anddemonstrates commitment to the role. The corporategovernance statement contains details on the role of the Board and its committees on pages 35-43 of theAnnual report.

Jack Keenan is retiring from the Board at the conclusionof the 2007 AGM, when he will have completed twothree-year terms as a non-executive director. As requiredby the Company’s Articles of Association (the ‘Articles’),Ian Dyson and Steven Holliday are retiring and seeking re-election as directors. Martha Lane Fox is seeking electionas a non-executive director following her appointment tothe Board on 1 June 2007.

Resolutions 7 and 8 – Re-appointment of the auditorsand authority for the Audit Committee to determinetheir remuneration On the recommendation of the Audit Committee, theBoard proposes that PricewaterhouseCoopers LLP be re-appointed as auditors of the Company. Resolution 8proposes that the Audit Committee be authorised todetermine the level of the auditors’ remuneration.

Resolutions 9 and 10 – Renewal of the powers of theBoard to allot shares and to disapply pre-emption rightsThe Company’s Articles empower directors to allotunissued shares. In accordance with Section 80 of theCompanies Act 1985 such allotments must be authorisedby the shareholders in general meeting. Resolution 9seeks renewal of this power to allot shares up to amaximum of £141,715,176 (the Section 80 Amount) andis equal to 33.3% of the Company’s issued share capitalas at 8 May 2007, being the latest practicable date beforethe publication of this Notice.

2 Marks and Spencer Group plc

The directors are also seeking authority to disapplyshareholder pre-emption rights so that shares may beallotted for cash, other than by way of a rights issue.Resolution 10 seeks authority to allot shares for cashother than by way of a rights issue up to a maximum of£21,257,276 (the Section 89 Amount) and is equal to 5%of the Company’s issued share capital as at 8 May 2007,being the latest practicable date before the publication ofthis Notice.

There are no current plans to allot shares except inconnection with employee share schemes. In addition, inline with best practice guidelines, the Company has notissued more than 7.5% of issued share capital on a nonpre-emptive basis over the past 3 years. The authoritieswill expire on the date of the AGM in 2008 or 9 October2008 whichever is sooner.

Resolution 11 – Authorisation for the Company topurchase its own shares With the authority of shareholders in general meeting, theCompany is empowered by its Articles to purchase itsown shares subject to the provisions of the CompaniesAct 1985. The directors believe it is prudent to seekgeneral authority from shareholders to be able to act ifcircumstances arose in which they considered suchpurchases to be desirable. This power will only beexercised if and when, in the light of market conditionsprevailing at that time, the directors believe that suchpurchases would increase earnings per share and wouldbe for the benefit of shareholders generally. This resolutionspecifies the maximum number which may be acquired(approximately 10% of the Company’s issued sharecapital) and minimum and maximum prices at which theymay be bought. As at 8 May 2007, the latest practicabledate before the publication of this Notice, there wereoptions outstanding over approximately 44 million ordinaryshares, representing 2.6% of the Company’s issuedordinary share capital. If the authority given by Resolution11 were to be fully used, these would then represent2.89% of the Company’s ordinary share capital in issue atthat date.

Under the Companies (Acquisition of Own Shares)(Treasury Shares) Regulations 2003, the Company isallowed to hold its own shares in treasury following a buy-back as an alternative to cancelling them. Shares held intreasury may be subsequently sold for cash, but all rightsattaching to them, including voting rights and the right toreceive dividends, are suspended while they are held intreasury. It is the Company’s present intention to cancelany shares it buys back rather than hold them in treasury.

Resolution 12 – Amendments to the Articles ofAssociation (including Electronic Communication)In order to take advantage of recently enacted provisionsin the Companies Act 2006 (the ‘2006 Act’) and otherlegislative developments, it is proposed that theCompany’s Articles are amended in three places. Asummary of these changes is set out below. A copy ofthe Articles showing the proposed changes will beavailable for inspection at the 2007 AGM, on theCompany’s website and at the Company’s registeredoffice. It is expected that the remaining provisions of the2006 Act will come into force during the remainder of2007 and throughout 2008. Much of the detail in relationto the outstanding provisions has not yet been finalised,therefore it may be necessary to review the Articles inmore detail in due course.

(i) Electronic Communication (Article 135(C))We are seeking to amend the Articles to ensure theCompany can benefit from the changes to the lawgoverning electronic communication and to promote thetransmission of more information through our website. Weaim to tailor our shareholder communication to meet theindividual needs of our 270,000 shareholders, who canchoose to receive our summary Annual review or fullAnnual report, either in hard copy or through our website.Audio and large print versions of the text from our Annualreview are also available on our website which now hasimproved navigation and accessibility.

It is intended that the Company will be able to useelectronic communication as the default method ofcommunicating with shareholders, including for example,the delivery of the Annual report.

3Marks and Spencer Group plc

If this resolution is approved, we will write to individualshareholders in January 2008, requesting that those whowish to continue receiving hard copy documents advisethe Company by returning the reply-paid form to beprovided. In accordance with the 2006 Act, shareholderswho do not respond within 28 days will be deemed tohave consented to receive future communicationselectronically. However, in practice, shareholders canadvise the Company at any time until mid-May in eachyear to be included in the Annual report mailing for thatyear and for future years. Shareholders can also requesthard copy documents at any time.

The Board regards the move to increased electroniccommunication with its shareholders as a positive one forshareholders, increasing the range of ways in which theycan access information about the Company and providingmore information on the website. It will also benefit theCompany as it will reduce paper, print and postage,minimising waste, our impact on the environment andreducing costs.

(ii) Joint Shareholders (Article 135(D))In order to make the flow of information more efficientbetween the Company and our joint shareholders, theArticles are being amended so that where there are jointshareholders, anything agreed or specified with theCompany by any one joint shareholder will have beendeemed to have been agreed or specified with theCompany by all the joint shareholders.

(iii) Director’s Retirement Age (Articles 82 and 87(C))Following the introduction of The Employment Equality(Age) Regulations 2006, the 2006 Act has repealed theprovision in the Companies Act 1985, that requiresdirectors to retire and seek re-election annually once theyreach the age of 70 or over. The Company’s Articles aretherefore being updated to reflect this change.

Resolution 13 – Renewal of the All EmployeeSharesave Plan The Company’s current Sharesave Plan comes to the endof its 10 year life this year. The directors consider that thisplan has been a valuable tool in encouraging wideremployee share ownership and over 21,000 employeescurrently participate. Accordingly, shareholder approval isbeing sought to introduce a replacement Sharesave Plan– the ‘Sharesave Plan 2007’. The replacement plan issimilar to the existing plan, although it has been updatedto reflect current market practice. The main terms of theproposed Sharesave Plan 2007 are summarised in theAppendix to this Notice.

Recommendation Your directors believe that the proposals described in thisbooklet are in the best interests of the Company and itsshareholders as a whole and recommend you to givethem your support by voting in favour of the resolutions,as they intend to in respect of their own beneficialshareholdings.

Yours sincerely

Graham Oakley, Group Secretary7 June 2007


NOTICE OF MEETING

Marks and Spencer Group plcNotice is hereby given that the sixth Annual General Meeting of Marks and Spencer Group plc will be held at Earls Court 2, London, SW5 9TA on Tuesday 10 July 2007 at 2pm for the following purposes:


Ordinary Business1 To receive the report of the directors and the financial

statements for the 52 weeks ended 31 March 2007,together with the report of the auditors.

2 To approve the Remuneration report.

3 To declare a final dividend on the ordinary shares.

To elect the following director who was appointed by theBoard since the last Annual General Meeting:

4 Martha Lane Fox

To re-elect the following directors who are retiring byrotation:

5 Ian Dyson

6 Steven Holliday

7 To resolve as an ordinary resolution:That PricewaterhouseCoopers LLP be, and are hereby,re-appointed auditors of the Company to hold officeuntil the conclusion of the next general meeting atwhich accounts are laid before the Company.

8 To resolve as an ordinary resolution:That the Audit Committee determine the remunerationof the auditors on behalf of the Board.

Special BusinessDirectors’ authority to allot shares9 To resolve as an ordinary resolution:

That the authority conferred on the directors by Article10 of the Company’s Articles of Association berenewed for the period expiring on the date of theAnnual General Meeting of the Company to be held in2008 or on 9 October 2008, whichever is sooner, inrespect of relevant securities up to an aggregatenominal amount (the Section 80 Amount) of£141,715,176.

Disapplication of pre-emption rights10 To resolve as a special resolution:

That the authority conferred on the directors by Article 10 of the Company’s Articles of Association be renewed for the period ending on the conclusion of the Annual General Meeting in 2008 or on 9 October 2008, whichever is sooner, in respect of equity securities issued wholly for cash (a) inconnection with a rights issue, and (b) otherwise thanin connection with a rights issue up to an aggregatenominal amount (the Section 89 Amount) of£21,257,276.

Company’s authority to purchase its own shares 11 To resolve as a special resolution:

That the Company be generally and unconditionallyauthorised to make market purchases (as defined inSection 163(3) of the Companies Act 1985) on theLondon Stock Exchange of its ordinary 25p sharesprovided that: (a) the Company does not purchaseunder this authority more than 170 million ordinaryshares; (b) the Company does not pay less than 25pfor each ordinary share; (c) the Company does not payfor each ordinary share more than 105% of theaverage of the middle market price of the ordinaryshares according to the Daily Official List of the LondonStock Exchange for the five business days immediatelypreceding the date on which the purchase is made; (d) this authority shall expire on the date of the AnnualGeneral Meeting of the Company to be held in 2008 or9 October 2008, whichever is sooner; and (e) theCompany may agree before the authority terminatesunder (d) above to purchase ordinary shares where thepurchase will or may be executed after the authorityterminates (either wholly or in part). The Company maycomplete such a purchase even though the authorityhas terminated.

Amendments to the Articles of Association (includingElectronic Communication)12 To resolve as a special resolution:

That the alterations to the Articles of Association of theCompany, shown in the copy of the Articles of Associationof the Company presented to the meeting and signedfor the purposes of identification by the Chairman, beapproved with effect from the conclusion of the AGM.

Renewal of the All Employee Sharesave Plan 13 To resolve as an ordinary resolution:

That the Marks and Spencer Group Sharesave Plan2007 (the ‘Plan’) the principal terms of which aresummarised in the Appendix to this Notice and therules of which are produced to the meeting and signedby the Chairman for the purposes of identification, isapproved and the directors are authorised to makesuch modifications to the Plan as they may considerappropriate to take account of the requirements of HMRevenue & Customs, the UK Listing Authority and bestpractice, and to adopt the Plan as so modified and todo all such acts and things as they may considerappropriate to implement the Plan.

By order of the Board

Graham Oakley, Group Secretary, 7 June 2007, London

Registered office, Waterside House, 35 North Wharf Road, London W2 1NW. Registered in England and Wales Registered No. 4256886

Notes: 1 Biographies of the directors seeking (re-)election

are given on page 27 of the Annual report and theAnnual review, including membership of the principalcommittees. The unexpired terms of their servicecontracts are as follows: executive – 12 months; andnon-executive – 3 months.

2 Every member entitled to attend and vote at the AGMmay appoint a Proxy to attend and to vote instead ofthat member. A Proxy need not be a member of theCompany.

3 The time by which a person must be entered on theCompany’s register of members in order to attend orvote at the meeting is 2pm on Sunday 8 July 2007.

4 The following documents which are available forinspection at an agreed time please ring +44 (0)20 8718 9888 during normal business hours on any weekday (Saturdays, Sundays and publicholidays excluded), at the Company’s registered office,Waterside House, 35 North Wharf Road, London W2 1NW, will also be available for inspection at EarlsCourt 2, London, SW5 9TA from 1pm on 10 July 2007until the conclusion of the AGM:

(i) copies of the executive directors’ servicecontracts;

(ii) copies of the non-executive directors’ letters ofappointment;

(iii) the Articles of Association of the Companyincluding the proposed alterations; and

(iv) the directors’ Deeds of Indemnity.

5 A copy of the draft rules of the Marks and SpencerGroup Sharesave Plan 2007 will be available forinspection at the offices of New Bridge StreetConsultants LLP at 20 Little Britain, London, EC1A7DH during normal business hours on any weekday(Saturdays, Sundays and public holidays excluded)from the date of this Notice up to and including thedate of the AGM and at Earls Court 2, London, SW5 9TA from 1pm on 10 July 2007 until theconclusion of the AGM.

6 Shareholders are advised that unless otherwiseprovided, the telephone numbers and websiteaddresses set out in this Notice are not to be used for the purpose of serving information or documents on the Company (including the service of documentsor information relating to proceedings at theCompany’s AGM).

7 As at 8 May 2007, the capital of Marks and SpencerGroup plc consisted of 1,700,582,115 ordinary shareswith voting rights. Therefore, the total number of votingrights in the Marks and Spencer Group plc at that datewas 1,700,582,115.

8 CREST members who wish to appoint a Proxy orProxies through the CREST electronic Proxyappointment service may do so for the AGM and anyadjournment thereof by using the proceduresdescribed in the CREST manual. CREST personalmembers or other CREST sponsored members, andthose CREST members who have appointed a votingservice provider, should refer to their CREST sponsoror voting service provider, who will be able to take theappropriate action on their behalf. In order for a Proxyappointment or instruction made using the CRESTservice to be valid, the appropriate CREST message (a ‘CREST Proxy Instruction’) must be properlyauthenticated in accordance with CRESTCo’sspecifications and must contain the informationrequired for such instructions, as described in theCREST manual. All messages relating to theappointment of a Proxy or an instruction to a previouslyappointed Proxy must be transmitted so as to bereceived by Lloyds TSB Registrars (ID 7RA01) no laterthan 2pm on Sunday 8 July 2007. Normal systemtimings and limitations will apply in relation to the inputof CREST Proxy instructions. It is therefore theresponsibility of the CREST member concerned to takesuch action as shall be necessary to ensure that amessage is transmitted by means of the CRESTsystem by any particular time. In this connection,CREST members and, where applicable, their CRESTsponsors or voting service providers are referred, inparticular, to those sections of the CREST manualconcerning practical limitations of the CREST systemand timings. The Company may treat as invalid aCREST Proxy Instruction in the circumstances set outin Regulation 35(5)(a) of the Uncertificated SecuritiesRegulations 2001.

9 Please see the letter from the Group Secretary dated 7 June 2007 for further explanatory notes.



APPENDIX

Summary of principal terms of the Marks and SpencerGroup plc Sharesave Plan 2007 (the ‘Plan’)

OperationThe operation of the Plan will be supervised by the boardof directors of the Company (the ‘Board’). It will beapproved by HM Revenue & Customs (‘HMRC’) in orderto provide UK tax-advantaged options to UK employees.

EligibilityEmployees and full-time directors of the Company andany designated participating subsidiary who are UKresident tax payers are eligible to participate. The Boardmay require employees to have completed a qualifyingperiod of employment of up to five years before the grantof options. The Board may also allow other employees toparticipate.

Grant of optionsOptions can only be granted to employees who enter intoHMRC approved savings contracts, under which monthlysavings are normally made over a period of three or fiveyears. Options will be granted within 30 days (or 42 daysif applications are scaled back) of the first day byreference to which the option price is set. The number ofshares over which an option is granted will be such thatthe total option price payable for those shares willcorrespond to the proceeds on maturity of the relatedsavings contract.

An option may not be granted more than 10 years aftershareholder approval of the Plan. Options are nottransferable, except on death. Options are notpensionable.

Individual participationMonthly savings by an employee under all savingscontracts linked to options granted under any sharesaveplan may not exceed the statutory maximum (currently£250). The Board may set a lower limit in relation to anyparticular grant.

Option priceThe price per share payable upon the exercise of anoption will not be less than the higher of: (i) 80 per cent ofthe average middle-market quotation of a share on theLondon Stock Exchange on the three days preceding adate specified in an invitation to participate in the plan (orsuch other day or days as may be agreed with HMRC);and (ii) if the option relates only to new issue shares, thenominal value of a share.

The option price will be determined by reference todealing days which fall within six weeks of the Company’sannouncement of its results for any period or at any othertime when the Board considers there are exceptionalcircumstances which justify offering options under thePlan.

Exercise of optionsOptions will normally be exercisable for six months fromthe third, fifth or seventh anniversary of the start of therelated savings contracts. Earlier exercise is permitted,however, in the following circumstances:

• following cessation of employment by reason of death,injury, disability, redundancy, retirement on reachingage 65 (or any other age at which the employee isbound to retire under his terms of employment) or thebusiness or company that the employee works forceasing to be part of the Company’s group;

• when an employee reaches 65;

• where employment ceases more than three years fromgrant because of retirement or severance; and

• in the event of a takeover, amalgamation,reconstruction or winding-up of the Company, exceptin the case of an internal corporate re-organisationwhen the Board may decide to exchange existingoptions for equivalent new options over shares in anew holding company.

Except where described above, options will lapse oncessation of employment or directorship with theCompany’s group.

Shares will be allotted or transferred to participants within30 days of exercise.


Plan limitsThe Plan may operate over new issue shares, treasuryshares or shares purchased in the market.

In any 10 calendar year period, the Company may notissue (or grant rights to issue) more than 10 per cent ofthe issued ordinary share capital of the Company underthe Plan and any other employee share plan adopted bythe Company.

Treasury shares will count as new issue shares for thepurposes of these limits unless the institutional investorsdecide that they need not count.

Variation of share capitalIf there is a variation in the Company’s share capital thenthe Board may, subject to HMRC approval, make suchadjustment as it considers appropriate to the number ofshares under option and the option price.

Rights attaching to sharesAny shares allotted when an option is exercised under thePlan will rank equally with shares then in issue (except forrights arising by reference to a record date prior to theirallotment).

Alterations to the PlanThe Board may amend the provisions of the Plan in anyrespect, provided that the prior approval of shareholdersis obtained for any amendments that are to the advantageof participants in respect of the rules governing eligibility,limits on participation, the overall limits on the issue ofshares or the transfer of treasury shares, the basis fordetermining a participant’s entitlement to, and the termsof, the shares to be acquired and the adjustment ofoptions.

The requirement to obtain the prior approval ofshareholders will not, however, apply to any minoralteration made to benefit the administration of the Plan,to take account of a change in legislation or to obtain ormaintain favourable tax, exchange control or regulatorytreatment for participants or for any company in theCompany’s Group.


THE VENUE

TimeDoors will open at 12.15pm with the AGM commencingat 2pm. Please try to arrive by 1.45pm to allow time forregistration and security clearance.

AdmissionPlease bring with you the attendance card which isattached to your Proxy form. This will help us to registeryour attendance without delay.

RefreshmentsRefreshments will be available before the meeting.

Shareholders with special needsEarls Court 2 is easily accessible for wheelchair users.There is an assisted hearing system available within theauditorium and handsets will be available from theCustomer Services Desk in the Welcome Area. A signlanguage interpreter will also be in attendance during themeeting. You are more than welcome to bring someonewith you. Marks & Spencer representatives will be onhand if you require assistance during the meeting.

Further queriesIf you have a query about the AGM or the contents of thisdocument, please call Marks & Spencer Group Secretariaton +44 (0)20 8718 9888.

WebcastFor shareholders unable to attend the AGM, we areproviding a webcast on our corporate website. Shouldyou wish to register a question for the meeting, you areinvited to complete and return, in advance, the reply paidshareholder topics card, enclosed with this document orto send an email to [email protected] the heading AGM 2007. The live webcast will beavailable from 2pm on 10 July 2007, please logon to:www.marksandspencer.com/thecompany. An archiveversion will also be available from the following day.

Your M&S storeThe nearest Simply Food store to the venue can be foundat: 266-268 Earls Court Road, London, SW5 9AS. Thenearest full offer store is located at 113 Kensington HighStreet, London, W8 5SQ and is a 25 minute walk away or a one-stop journey on the District line from Earls Courttube station to High Street Kensington.

RailSilverlink and Southern trains run direct services to WestBrompton station. Direct services run from ClaphamJunction, Gatwick Airport, East Croydon, WatfordJunction, Willesden Junction and Stratford. The entranceto Earls Court 2 is directly opposite the exit at WestBrompton station. For National Rail enquiries please visitwww.nationalrail.co.uk or call 08457 48 49 50. Ticketscan also be purchased at www.thetrainline.com.

TubeEarls Court 2 can be accessed via the Piccadilly andDistrict lines at Earls Court station (Warwick Road exit)and via the District line at West Brompton station, whichis marginally closer.

BusEarls Court 2 is served by the following bus routes:Warwick Road: 74, 328, C1, C3 and Lillie Road: 190.

See the map for reference, visit www.tfl.gov.uk for moreinformation, or call Transport for London on: +44 (0)20 7222 1234.

CoachNational Express offer frequent services to LondonVictoria Coach station. Some routes also stop on EarlsCourt Road. For more information and to purchase tickets please visit www.nationalexpress.com or call08705 808080.

CarWe recommend travelling to the venue by public transportas a more environmentally friendly option. However, if youdo need to come by car then there are two car parks(please note, charges will apply and there is no guaranteethat spaces will be available):

Red Car Park (P2): Multi-storey car park located on sitenext to Earls Court 2 (see map for reference).

Seagrave Road Car Park (P1): Open air car park. Pleasenote that this car park is a short walk to Earls Court 2(see map for reference).

For more information on parking, and to book discounted spaces, call Earls Court Booking Services on 020 7598 2515 or visit www.eco.co.uk

For assistance in planning your route visitwww.theaa.com

Earls Court 2 is just outside the congestion charging zoneplease visit www.cclondon.com or call 0845 900 1234 for more information.

Earls Court 2, London, SW5 9TA

AR7225_M&S_Notice_of_Meeting_2007 5/6/07 14:48


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ar7225 m&s notice of meeting 2007...ian dyson and steven holliday are retiring and seeking...

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