XAAR PLC

AGM Information • May 7, 2020

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author: Tony Mason
date: 2020-05-04 12:10:00+00:00

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COVID-19 statement

In the lead up to the Annual General Meeting, we are closely monitoring the impact of the COVID-19 virus in the United Kingdom. In light of current public health advice and “Stay at Home” legislation recently introduced, external shareholders (i.e. shareholders who do not also hold office as a director of the Company) are prohibited from attending the Annual General Meeting in person. Shareholders attempting to attend the meeting will be refused admission. Instead of attending this year’s AGM, shareholders are asked to exercise their votes by submitting their proxy as set out in the Notice of Meeting. All shareholders are strongly recommended to vote electronically at www.signalshares.com as your vote will automatically be counted. Given the currently escalating situation sending a paper proxy is no guarantee of having your vote counted. In addition, should a shareholder have a question that they would have raised at the meeting, we ask that they send it by e mail to investor.relations@xaar.com before 5.00 pm on 25 May 2020. Answers to the questions will be published on our corporate website (www.xaar.com) after the AGM.

Notice is hereby given that the twenty-third Annual General Meeting (‘AGM’) of Xaar plc (the ‘Company’) will be held at Xaar plc, 316 Science Park, Milton Road, Cambridge, CB4 0XR on Tuesday 2 June 2020 at 9:30am for the following purposes:

Ordinary business

To consider and, if thought fit, pass the following Resolutions which will be proposed as Ordinary Resolutions:

1. THAT the Company’s annual financial statements for the financial year ended 31 December 2019 , together with the Directors’ report and auditor’s report on those financial statements, be received and adopted.

2. THAT Ernst & Young LLP be re-appointed as the Company’s auditors to hold office from the conclusion of this meeting until the conclusion of the next general meeting of the Company at which financial statements are laid.

3. THAT the Directors be authorised to determine the remuneration of the auditors.

4. THAT Dr Robert Mills be re-elected as a Director of the Company.

5. THAT Andrew Herbert be re-elected as a Director of the Company.

6. THAT Christopher Morgan be re-elected as a Director of the Company.

7. THAT Ian Tichias be re-elected as a director of the Company.

8. THAT the Directors’ remuneration report (excluding the Directors’ remuneration policy which is set out on pages 63 to 85 of the Annual Report) for the year ended 31 December 2019 be approved.

Special business

To consider and, if thought fit, pass the following Resolutions which will be proposed in the case of Resolution 9 as an Ordinary Resolution and in the case of Resolutions 10 to 12 as Special Resolutions:

1. THAT, in substitution for all existing authorities including the authority conferred on the Directors of the Company by Article 4(b) of the Company’s Articles of Association, pursuant to and in accordance with section 551 of the Companies Act 2006 (‘Act’) the Directors of the Company be hereby generally and unconditionally authorised to exercise all powers of the Company to allot equity securities (within the meaning of section 560 of the Act), or grant rights to subscribe for, or convert any security into, shares in the Company (‘Rights’):

(i) up to an aggregate nominal value of £2,611,143 (being the nominal value of approximately one third of the issued share capital of the Company); and

(ii) up to an aggregate nominal value of £5,222,286 (being the nominal value of approximately two thirds of the issued share capital of the Company) (such amount to be reduced by the nominal amount of any equity securities allotted or Rights granted under paragraph (i)) in connection with an offer by way of a rights issue (as defined in the Listing Rules issued by the Financial Conduct Authority pursuant to Part VI of the Financial Services and Markets Act 2000) or other pre-emptive offer to:

(a) the holders of ordinary shares of 10 pence each in the capital of the Company (‘ordinary shares’) in proportion (as nearly as may be practicable) to the respective numbers of ordinary shares held by them; and

(b) holders of other equity securities, as required by the rights of those securities or, subject to such rights, as the Directors otherwise consider necessary, and so that, in each case, the Directors of the Company may impose any limits or restrictions and make any arrangements which they consider necessary or appropriate to deal with treasury shares, fractional entitlements, record dates, legal, regulatory or practical problems in, or under the laws of, any territory or the requirements of any regulatory body or stock exchange or any other matter, such authority to expire on the earlier of the next Annual General Meeting of the Company held after the date on which this resolution becomes unconditional and the date 15 months after the passing of this Resolution, save that the Company may at any time before such expiry make any offer(s) or enter into any agreement(s) which would or might require shares to be allotted or Rights to be granted after such expiry and the Directors may allot shares or grant Rights in pursuance of any such offer(s) or agreement(s) as if the authority conferred hereby had not expired. This Resolution revokes and replaces all unexercised authorities previously granted to the Directors to allot shares or grant Rights but without prejudice to any allotment of shares or grant of Rights already made, offered or agreed to be made pursuant to such authorities.

1. THAT, subject to the passing of Resolution 9, the Directors of the Company be authorised to allot equity securities (as defined in section 560 of the Act) for cash under the authority conferred by that Resolution and/or to sell ordinary shares held by the Company as treasury shares as if section 561 of the Act did not apply to any such allotment or sale, provided that such authority shall be limited to:

(a) the allotment of equity securities in connection with an offer of equity securities (but, in the case of the authority granted under paragraph (ii) of Resolution 9, by way of a rights issue only):

(i) to the holders of ordinary shares in proportion (as nearly as may be practicable) to their respective holdings; and

(ii) to holders of other equity securities as required by the rights of those securities or as the Directors otherwise consider necessary, but subject to such exclusions or other arrangements as the Directors of the Company may deem necessary or expedient in relation to treasury shares, fractional entitlements, record dates, legal or practical problems in or under the laws of any territory or the requirements of any regulatory body or stock exchange; and

(b) the allotment of equity securities or sale of treasury shares (otherwise than pursuant to paragraph (i) of this Resolution) to any person up to an aggregate nominal amount of £391,672.

The authority granted by this Resolution will expire at the conclusion of the Company’s next Annual General Meeting after the passing of this Resolution or, if earlier, at the close of business on the date 15 months after the passing of this Resolution, save that the Company may, before such expiry make offers or agreements which would or might require equity securities to be allotted (or treasury shares to be sold) after the authority expires and the Directors of the Company may allot equity securities (or sell treasury shares) in pursuance of any such offer or agreement as if the authority had not expired.

1. THAT, subject to the passing of Resolution 9, the directors of the Company be authorised in addition to any authority granted under Resolution 10 to allot equity securities (as defined in section 560 of the Act) for cash under the authority conferred by Resolution 9 and/or to sell ordinary shares held by the Company as treasury shares as if section 561 of the CA 2006 did not apply to any such allotment or sale, provided that such authority shall be:

(a) limited to the allotment of equity securities or sale of treasury shares up to an aggregate nominal amount of £391,672; and

(b) used only for the purpose of financing (or refinancing, if the authority is to be used within six months after the original transaction) a transaction which the Directors of the Company determine to be an acquisition or other capital investment of a kind contemplated by the Statement of Principles on Disapplying Pre-Emption Rights most recently published by the Pre-Emption Group prior to the date of this notice.

The authority granted by this Resolution will expire at the conclusion of the Company’s next Annual General Meeting after this Resolution is passed or, if earlier, at the close of business on the date 15 months after the passing of this Resolution, save that the Company may, before such expiry make offers or agreements which would or might require equity securities to be allotted (or treasury shares to be sold) after the authority expires and the Directors of the Company may allot equity securities (or sell treasury shares) in pursuance of any such offer or agreement as if the authority had not expired.

1. That the Company be generally and unconditionally authorised for the purposes of section 701 of the Act to make one or more market purchases (within the meaning of section 693(4) of the Act) of ordinary shares provided that:

(a) the maximum aggregate number of ordinary share authorised to be purchased is 11,671,810 (representing 14.9% of the issued ordinary share capital);

(b) the minimum price (excluding expenses) which may be paid for an ordinary share is the par value of the shares;

(c) the maximum price (excluding expenses) which may be paid for an ordinary share is an amount equal to the higher of (i) 105% of the average of the middle market quotations for an ordinary share as derived from the London Stock Exchange Daily Official List for the five business days immediately preceding the day on which that ordinary share is purchased, and (ii) the amount stipulated by article 5(1) of the Buy-back and Stabilisation Regulation 2003; this authority shall expire at the conclusion of the next Annual General Meeting of the Company, or, if earlier, at the close of business on the date which is 15 months after the passing of this Resolution unless renewed, revoked or varied before that time; and the Company may make a contract to purchase ordinary shares under this authority before the expiry of the authority which will or may be executed wholly or partly after the expiry of the authority, and may make a purchase of ordinary shares in pursuance of any such contract.

1. That, the Directors’ Remuneration Policy, the full text of which is contained in the Directors’ Remuneration report for the year ended 31 December 2019 and which is set out in pages 63 to 85 of the Annual Report. Which will take effect at the conclusion of this meeting, be approved.

2. That the amendments to the Xaar 2017 Long-Term Incentive Plan, as shown in the marked-up version of the plan rules produced to the meeting, be and they are hereby approved and the Directors be and are generally authorised to adopt the amendments and to do all acts and things that they consider necessary or expedient to give effect to the amendments. (Further details included in note 17 of the Notice of AGM).

By order of the Board

Ian Tichias

Company Secretary

22 April 2020

Notes

1. A member entitled to attend and vote at the meeting may appoint one or more proxies to exercise all or any of the member’s rights to attend, speak and vote at the meeting. A proxy need not be a member of the Company but must attend the meeting for the member’s vote to be counted. If a member appoints more than one proxy to attend the meeting, each proxy must be appointed to exercise the rights attached to a different share or shares held by the member. If a member wishes to appoint one or more proxies they may do so at www.signalshares.com, if not already registered you will need your Investor code to do so, this can be found on your share certificate. If paper proxy forms are required, the member should contact the registrars’ helpline on 0871 664 0300 (calls cost 12 pence per minute plus network extras). If you are outside the United Kingdom, please call +44 371 664 0300 (calls will be charged at the applicable international rate). We are open between 9.00 a.m.– 5.30 p.m., Monday to Friday excluding public holidays in England and Wales. Submission of a proxy vote shall not preclude a member from attending and voting in person at the meeting in respect of which the proxy is appointed or at any adjournment thereof.

2. To be effective, the proxy vote must be submitted at www.signalshares.com so as to have been received by the Company’s registrars not less than 48 hours (excluding weekends and public holidays) before the time appointed for the meeting or any adjournment of it. Any power of attorney or other authority under which the proxy is submitted must be returned to the Company’s registrars, Link Asset Services, PXS1, 34 Beckenham Road, Beckenham, Kent, BR3 4ZF. If a paper form of proxy is requested from the registrar, it should be completed and returned to Link Asset Services, PXS1, 34 Beckenham Road, Beckenham, Kent, BR3 4ZF to be received not less than 48 hours before the time of the meeting.

3. Any person to whom this notice is sent who is a person nominated under section 146 of the Companies Act 2006 to enjoy information rights (a ‘Nominated Person’) may, under an agreement between him/her and the shareholder by whom he/she was nominated, have a right to be appointed (or to have someone else appointed) as a proxy for the Annual General Meeting. If a Nominated Person has no such proxy appointment right or does not wish to exercise it, he/she may, under any such agreement, have a right to give instructions to the shareholder as to the exercise of voting rights.

4. The statement of the rights of shareholders in relation to the appointment of proxies in paragraphs 1 and 2 above does not apply to Nominated Persons. The rights described in these paragraphs can only be exercised by shareholders of the Company.

5. In accordance with Regulation 41 of the Uncertified Securities Regulations 2001, the Company specifies that only those members entered on the register of members of the Company as at close of business on 31 May 2020 (or in the event the meeting is adjourned, on the register of members 48 hours before the time of any adjourned meeting) shall be entitled to attend or vote at the meeting in respect of the number of shares registered in their name at that time. Changes to entries on the register of members after close of business on 31 May 2020 (or in the event the meeting is adjourned, on the register of members less than 48 hours before the time of any adjourned meeting) shall be disregarded in determining the rights of any person to attend or vote at the meeting.

6. Copies of Directors’ service agreements, the terms of appointment of Non-Executive Directors, the register of Directors’ interests kept by the Company under section 808 of the Companies Act 2006, the Xaar plc 2004 Share Option Plan, the Xaar plc 2007 Share Save Plan, the Xaar plc 2017 Share Save Plan, Xaar plc 2007 Long-Term Incentive Plan, the Xaar Share Incentive Plan and the Xaar 2017 Long-Term Incentive Plan will be available 15 minutes prior to the commencement of the meeting and will remain open and accessible during the continuance of the meeting to any person attending the meeting.

7. Biographical details of all Directors offering themselves for re-appointment are set out on pages 44 and 45 of the Annual Report and Accounts. The Company announced in September 2019, that Margaret Rice-Jones would not seek re-election at this year’s Annual General Meeting as she was intending to leave the Board at the time of the Meeting. It remains the case that Margaret will not seek re-election at the Annual General Meeting on the basis that she will soon leave the Board. However, given the uncertainty of the current environment, Margaret has agreed to remain in office until the end of June so as to ensure an orderly transition once her successor is identified.

8. Shareholders should note that it is possible that, pursuant to requests made by shareholders of the Company under section 527 of the Companies Act 2006, the Company may be required to publish on a website a statement setting out any matter relating to: (i) the audit of the Company’s accounts (including the auditor’s report and the conduct of the audit) that are to be laid before the Annual General Meeting; or (ii) any circumstance connected with an auditor of the Company ceasing to hold office since the previous meeting at which annual accounts and reports were laid in accordance with section 437 of the Companies Act 2006. The Company may not require the shareholders requesting any such website publication to pay its expenses in complying with sections 527 or 528 of the Companies Act 2006. Where the Company is required to place a statement on a website under section 527 of the Companies Act 2006, it must forward the statement to the Company’s

auditor not later than the time when it makes the statement available on the website. The business which may be dealt with at the Annual General Meeting includes any statement that the Company has been required under section 527 of the Companies Act 2006 to publish on a website.

1. In order to facilitate voting by corporate representatives at the meeting, arrangements will be put in place at the meeting so that: (i) if a corporate shareholder has appointed the Chairman of the meeting as its corporate representative to vote on a poll in accordance with the directions of all of the other corporate representatives for that shareholder at the meeting, then on a poll those corporate representatives will give voting directions to the Chairman and the Chairman will vote (or withhold a vote) as corporate representative in accordance with those directions; and (ii) if more than one corporate representative for the same corporate shareholder attends the meeting but the corporate shareholder has not appointed the Chairman of the meeting as its corporate representative, a designated corporate representative will be nominated, from those corporate representatives who attend, who will vote on a poll and the other corporate representatives will give voting directions to that designated corporate representative. Corporate shareholders are referred to in the guidance issued by the Institute of Chartered Secretaries and Administrators on proxies and corporate representatives (www.icsa.org.uk) for further details of this procedure. The guidance includes a sample form of appointment letter if the Chairman is being appointed as described in (i) above.

2. CREST members who wish to appoint a proxy or proxies through the CREST electronic proxy appointment service may do so by using the procedures described in the CREST Manual. CREST Personal Members or other CREST sponsored members, and those CREST members who have appointed a service provider(s), should refer to their CREST sponsor or voting service provider(s), who will be able to take the appropriate action on their behalf.

3. In order for a proxy appointment or instruction made using the CREST service to be valid, the appropriate CREST message (a ‘CREST Proxy Instruction’) must be properly authenticated in accordance with CRESTCo’s specifications, and must contain the information required for such instruction, as described in the CREST Manual. The message, regardless of whether it constitutes the appointment of a proxy or is an amendment to the instruction given to a previously appointed proxy must, in order to be valid, be transmitted so as to be received by the issuer’s agent (ID RA10) by 9:30 am on 31 May 2020. For this purpose, the time of receipt will be taken to be the time (as determined by the timestamp applied to the message by the CREST Application Host) from which the issuer’s agent is able to retrieve the message by enquiry to CREST in the manner prescribed by CREST. After this time any change of instructions to proxies appointed through CREST should be communicated to the appointee through other means.

4. CREST members and, where applicable, their CREST sponsors, or voting service providers should note that CRESTCo does not make available special procedures in CREST for any particular message. Normal system timings and limitations will, therefore, apply in relation to the input of CREST Proxy Instructions. It is the responsibility of the CREST member concerned to take (or, if the CREST member is a CREST personal member, or sponsored member, or has appointed a voting service provider, to procure that his CREST sponsor or voting service provider(s) take(s)) such action as shall be necessary to ensure that a message is transmitted by means of the CREST system by any particular time. In this connection, CREST members and, where applicable, their CREST sponsors or voting system providers are referred, in particular, to those sections of the CREST Manual concerning practical limitations of the CREST system and timings.

5. The Company may treat as invalid a CREST Proxy Instruction in the circumstances set out in Regulation 35(5)(a) of the Uncertificated Securities Regulations 2001 (as amended).

6. As at 7.00am on 21 April 2020, the Company’s issued share capital comprised 78,334,296 ordinary shares of 10 pence each. Each ordinary share carries the right to one vote at a general meeting of the Company, except for the shares held in trust for the Xaar Share Incentive Plan totalling 100,124 ordinary shares and, therefore, the total number of voting rights in the Company as at 7.00am on 21 April 2020 is 78,234,172.

7. Any member attending the meeting has the right to ask questions. The Company must answer any such question relating to the business being dealt with at the meeting but no such answer need be given if: (a) to do so would interfere unduly with the preparation for the meeting or involve the disclosure of confidential information; (b) the answer has already been given on a website in the form of an answer to a question; or (c) it is undesirable in the interests of the Company or the good order of the meeting that the question be answered.

8. You may vote your shares electronically at www.signalshares.com. On the home page, search “Xaar plc” and then log in or register, using your Investor Code. To vote, click on the “Vote Online Now” button.

9. Resolution 14 relates to proposed amendments to the Xaar 217 Long-Term Incentive Plan (the ‘LTIP’). The LTIP was approved by shareholders at the AGM on 16 May 2017 and certain amendments are proposed, to provide more administrative flexibility and to reflect the proposed new Directors’ Remuneration Policy. The rules of the LTIP marked-up to show the proposed changes will be available for inspection on the Company’s website at www.xaar.com from the date of this Notice until the close of the Annual General Meeting. The changes for which shareholder approval is required are as follows.

(a) The LTIP includes a limit on the value of shares over which awards may be granted during any financial year of the Company. This limit is not being increased, and awards granted to the Company’s Executive Directors will be consistent with the Company’s Directors’ Remuneration Policy. However, recognising that in certain circumstances awards in respect of a financial year may not be made during that financial year, the limit is proposed to be varied so that it applies to awards in respect of a financial year rather than awards during a financial year. This will mean that if awards are not made during a particular financial year, the LTIP opportunity for that year can be granted in the following year (without affecting the opportunity for that subsequent year).

(b) The LTIP provides that in assessing the limit on awards, the market value of a share must be the middle market quotation of a share on the dealing day before grant, or the average of such quotations for up to five days. The rules are proposed to be varied so that the Remuneration Committee may determine the market value of a share for these purposes. This is to give flexibility in appropriate circumstances, and there is no intention to change the Company’s current practice. Awards granted to the Company’s Executive Directors will be consistent with the Company’s Directors’ Remuneration Policy.

(c) The LTIP provides that awards cannot vest before the third anniversary of grant. The rules are proposed to be varied so that awards may vest before this date. There is no intention to change the length of the performance period, but this amendment will mean that where awards are granted later than usual (for example due to regulatory restrictions) they can vest following assessment of the performance conditions, without the vesting being deferred as a result of the deferral of the grant.

Other changes will be made to the rules of the LTIP, for which shareholder approval is not required. These changes are to reflect the proposed new Directors’ Remuneration Policy and are as follows.

(a) To enable the operation of the post-vesting holding period on a “gross” basis, so that the participant is unable to acquire shares before the end of that holding period. The rules are also amended to permit the award of dividend equivalents over the holding period (reflecting that the participant will not own the shares and so will not be entitled to the dividends) and to reflect the impact of cessation of employment during the holding period.

(b) To enable the Remuneration Committee to make the delivery of shares subject to the participant agreeing to take any action required by the Remuneration Committee in connection with any post-employment shareholding requirement.

(c) To update the malus and clawback provisions so that they reflect the proposed new Directors’ Remuneration Policy.

1. A copy of this Notice, and other information required by section 311A of the Companies Act 2006, can be found at www.xaar.com.