The Allotment Committee's Terms of Reference

Purpose

The Allotment Committee ("the Committee") is a sub-committee of the Board of KCOM Group PLC ("the Company"). It supports the Board in the execution of its duties and responsibilities by considering and, if appropriate, authorising the allotment of shares and any associated administration.

Membership and meetings

The Committee shall meet only when required.

The quorum of the Committee shall be at least two members present in person, or by telephone, one of whom must be its Chairman (who will be an executive director), and the other must be the Company Secretary or Deputy Company Secretary. A duly convened meeting of the Committee at which a quorum is present shall be competent to exercise all or any of the authorities, powers and discretions vested in or exercisable by the Committee

Members of the Committee shall be appointed by the Board and shall be made up of least 3 members as stated above.

Only members of the Committee have the right to attend Committee meetings. However, other individuals, such as external advisers, may be invited to attend for all or part of any meeting, as and when appropriate.

Appointments to the Committee shall be for a period of up to three years, which may be extended.

The Board shall appoint the Committee Chairman who should be either the Chief Executive or another executive director. In the absence of the Committee Chairman the remaining members present shall elect one of their number to chair the meeting. The Company Secretary, Deputy Company Secretary or their nominee shall act as the Secretary of the Committee.

Meetings of the Committee shall be summoned by the Secretary of the Committee at the request of the Chairman of the Committee.

Unless otherwise agreed, notice of each meeting confirming the venue, time and date, together with an agenda of items to be discussed, shall be forwarded to each member of the Committee, any other person required to attend, no later than 5 working days before the date of the meeting. Supporting papers shall be sent to Committee members and to other attendees as appropriate, at the same time.

The Secretary shall minute the proceedings and resolutions of all Committee meetings, including the names of those present and in attendance.

Minutes of Committee meetings shall be circulated promptly to all members of the Committee and the Chairman of the Board and, once agreed, to all other members of the Board.

The Chairman of the Committee shall attend the Annual General Meeting prepared to respond to any shareholder questions on the Committee's activities.

Duties and responsibilities

The Committee shall:

Do all such acts and things and agree and execute all such documents, certificates, notices and other communications as may be required in connection with the allotment and/or issue of the ordinary shares of the Company.
Only authorise the issue of any shares providing the number of shares issued does not exceed the authority given by shareholders at the last Annual General Meeting in accordance with s.80 of the Companies Act 1985.

Reporting responsibilities

The Committee Chairman shall report formally to the Board on its proceedings after each meeting on all matters within its duties and responsibilities.

The Committee shall make whatever recommendations to the Board it deems appropriate on any area within its remit where action or improvement is needed.

The Committee shall make a statement in the annual report about its activities, the process used to make appointments and explain if external advice or open advertising has not been used.

Other

The Committee shall, at least once a year, review its own performance, constitution and terms of reference to ensure it is operating at maximum effectiveness and recommend any changes it considers necessary to the Board for approval.

Authority

The Committee is authorised to seek any information it requires from any employee of the Company in order to perform its duties.

The Committee is authorised to obtain, at the company's expense, outside legal or other professional advice on any matters within its terms of reference.