Pre-Annual General Meeting Information • Jun 21, 2016
Pre-Annual General Meeting Information
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This year's Annual General Meeting will be held at a new location: No. 11 Cavendish Square, London W1G 0AN on Thursday, 21 July 2016 at 11.00 am
This Notice of Meeting sets out the resolutions that shareholders are being asked to consider and vote on at the Annual General Meeting ('AGM') of Halma plc (the 'Company'). These resolutions are a very important part of the governance of the Company and all shareholders are urged to vote, whether they are able to attend or not.
If you are unable to attend the AGM in person, you can vote on the resolutions put to shareholders either online or by post as follows:
Please note that a printed copy of the Annual Report and Accounts 2016 will only be sent to you if you have opted to receive paper copies of such documents or if you have recently acquired shares. Otherwise you may now access the Annual Report and Accounts 2016 by visiting the Halma website at www.halma.com.
The results of the voting on the AGM resolutions will be posted on the Company's website after the Meeting.
If you are in any doubt as to the action you should take, you should consult your appropriate independent adviser immediately.
If you have sold or otherwise transferred all your shares in the Company, you should send this document, together with the Proxy Form, as soon as possible to the purchaser or transferee, or to the stockbroker, bank or other agent through whom the sale or transfer was effected for transmission to the purchaser or transferee.
NOTICE IS HEREBY GIVEN that the one hundred and twenty second Annual General Meeting of Halma plc will be held in the Burdett Suite at No.11 Cavendish Square, London W1G 0AN on Thursday, 21 July 2016 at 11.00 am for the following purposes:
To consider and, if thought fit, pass the following resolutions 1 to 14 as ordinary resolutions:
1 To receive the Accounts and the Reports of the Directors (including the Strategic Report) and the Auditor for the period of 53 weeks to 2 April 2016.
2 To declare a final dividend of 7.83p per share for the 53 weeks to 2 April 2016 payable on 17 August 2016 to shareholders on the Register of Members at the close of business on 15 July 2016.
3 To approve the Remuneration Report for the 53 weeks to 2 April 2016 as set out on pages 82 to 90 of the Annual Report and Accounts 2016.
14 That the Directors be and are hereby generally and unconditionally authorised pursuant to Section 551 of the Companies Act 2006 (the '2006 Act') to exercise all the powers of the Company to allot shares, or grant rights to subscribe for or to convert securities into shares, up to an aggregate nominal amount of £12,500,000 and that this authority shall expire on the earlier of the conclusion of the annual general meeting of the Company to be held in 2017 and the first anniversary of the passing of this resolution (unless previously renewed, varied or revoked by the Company), save that the Company may before such expiry make any offer or agreement which would or might require shares to be allotted or such rights to be granted after such expiry and the Directors may allot shares or grant such rights in pursuance of such offer or agreement as if the authority conferred hereby had not expired.
To consider and, if thought fit, pass the following resolutions 15 to 18 as special resolutions:
and shall expire (unless previously renewed, revoked or varied) when the authority contained in resolution 14 expires, save that the Company may make any offer or agreement before such expiry which would or might require equity securities to be allotted or equity securities held as treasury shares to be sold after such expiry.
16 That, subject to the passing of resolution 14 and in addition to any authority granted under resolution 15, the Directors be and are hereby empowered pursuant to Section 570 of the 2006 Act to allot or to make any offer or agreement to allot equity securities (as defined in Section 560 of the 2006 Act) of the Company pursuant to the authority contained in resolution 14 and/or sell equity securities held as treasury shares for cash pursuant to Section 727 of the 2006 Act, in each case as if Section 561 of the 2006 Act did not apply to any such allotment or sale, provided that such power shall be:
and shall expire (unless previously renewed, revoked or varied) when the authority contained in resolution 14 expires, save that the Company may make any offer or agreement before such expiry which would or might require equity securities to be allotted or equity securities held as treasury shares to be sold after such expiry.
and the authority hereby conferred shall expire at the conclusion of the Company's next annual general meeting (except in relation to the purchase of ordinary shares the contract for which was concluded before such date and which would or might be executed wholly or partly after such date), unless such authority is renewed prior to such time.
18 That a general meeting other than an annual general meeting may be called on not less than 14 clear days' notice.
The Directors believe that each of the proposals to be put to the meeting will be of benefit to and is in the best interests of the Company and the shareholders as a whole and unanimously recommend that shareholders vote in favour of all the resolutions set out above, as they intend to do in respect of their own beneficial shareholdings in the Company.
By order of the Board
Company Secretary 21 June 2016
Registered office: Misbourne Court, Rectory Way Amersham, Bucks HP7 0DE Registered in England and Wales No. 40932
Resolutions 1 to 14 will be proposed as ordinary resolutions which require a simple majority of the votes to be cast in favour of each resolution. Resolutions 15 to 18 will be proposed as special resolutions which require a 75% majority of the votes to be cast in favour of each resolution.
The Directors are required to present the audited accounts of the Company to shareholders at a general meeting, together with reports of the Directors (including the Strategic Report) and the Auditor (in this case for the period of 53 weeks to 2 April 2016).
This resolution seeks authority for the Company to pay a final dividend of 7.83p per share to shareholders for the financial year ended 2 April 2016, as recommended by the Directors. If approved the dividend will be paid on 17 August 2016 to shareholders on the Register of Members at the close of business on 15 July 2016.
The Company offers a Dividend Reinvestment Plan ('DRIP') to enable shareholders to elect to have their cash dividends reinvested in Halma plc shares. Shareholders who wish to elect for the DRIP for the forthcoming final dividend, but have not already done so, should return a DRIP mandate form to the Company's Registrar no later than 27 July 2016.
In accordance with Section 439A of the 2006 Act, the Remuneration Policy is now subject to a binding shareholder vote by ordinary resolution at least once every three years. Shareholder approval will be required if the Directors wish to change the policy within that three-year period. Full details of the Remuneration Policy are set out on pages 74 to 81 of the Annual Report and Accounts 2016. There is no policy vote this year as the policy was approved at the 2015 annual general meeting and no changes are proposed.
Section 439 of the 2006 Act requires that the Remuneration Report is put to a vote of shareholders at each annual general meeting. The Remuneration Report is set out on pages 82 to 90 of the Annual Report and Accounts 2016.
The Company's Articles of Association require that once every three years Directors retire by rotation and seek re-election to the Board at an annual general meeting. However, in accordance with the UK Corporate Governance Code, which recommends that all directors of FTSE 350 companies should stand for re-election by shareholders every year, the Board has decided that all Directors be subject to re-election at each annual general meeting.
The Chairman has confirmed that, following the performance evaluations, each of the non-executive Directors who is seeking reelection or election (Daniela Barone Soares, Roy Twite, Tony Rice and Carole Cran) continue to be effective members of the Board and demonstrate commitment to their responsibilities.
The Chairman himself is also seeking re-election and has the support of the Board. On the basis of the feedback received through the Board's performance evaluation process, Tony Rice, in his capacity as Senior Independent Director, confirms that Paul Walker is an effective Chairman and demonstrates commitment to his responsibilities.
Due to retirement, Jane Aikman will not be seeking re-election to the Board at the AGM and will step down from the Board at the conclusion of the AGM.
The biographies of the Directors retiring at the AGM who wish to seek re-election or who wish to seek election are as follows:
Paul was appointed non-executive Chairman of Halma in July 2013, having been appointed to the Board in April 2013. Paul is non-executive Chairman of Perform Group plc and WANdisco plc and a non-executive director of Experian plc and Sophos Group plc. He was CEO at The Sage Group plc from 1994 to 2010 and has previously served on the boards of Diageo plc and Mytravel Group plc. Paul qualified as a Chartered Accountant with Ernst & Young, having graduated from York University with an economics degree.
Andrew was appointed Chief Executive of Halma plc in February 2005. He was promoted to Director of the Halma plc Board in 2004. Andrew joined the Halma Executive Board in 2002 as Divisional Chief Executive after joining Halma in 1994 as Manufacturing Director of Reten Acoustics (now HWM-Water), where he became Managing Director in 1997. He is a Chartered Engineer and a production engineering graduate of Birmingham University. He attended the Advanced Management Program at Wharton Business School in 2004. Andrew is a non-executive director of Capita plc.
Kevin was appointed to the Halma plc Board in 1998. He became Group Finance Director in 1997 after joining the Halma Executive Board as Finance Director in 1995. Kevin joined Halma as Group Financial Controller in 1987. Kevin qualified as a Chartered Accountant with Price Waterhouse and is an economics and accounting graduate of Bristol University. He attended the Advanced Management Program at Harvard Business School in 2007.
Adam joined the Halma plc Board in April 2008 and is Chief Executive of the Medical sector. He became a member of the Halma Executive Board in 2003 as Divisional Chief Executive, having joined Halma in 1996 as President of Bio-Chem Valve. Adam gained his MBA from Harvard Business School and is a systems engineering graduate of the University of Pennsylvania.
Daniela was appointed a non-executive Director of Halma in November 2011. In September 2014, Daniela was appointed as non-executive Director of Brazil-based holding company Evora S.A. She was previously Chief Executive Officer of Impetus – The Private Equity Foundation and she has held senior roles at Save the Children, BancBoston Capital, Goldman Sachs and Citibank. Daniela has an MBA from Harvard Business School and a BSc in economics from Universidade Estadual de Campinas (UNICAMP), Brazil.
Roy was appointed a non-executive Director of Halma in July 2014. He is an executive director at IMI plc, having been appointed to the plc board in February 2007. During his career with IMI, Roy has led all of the divisions including Severe Service (2011), Fluid Power (2009), Beverage and Merchandising (2007) and Indoor Climate (2004). Roy has a BEng in Engineering from Nottingham University and gained his Masters in Manufacturing Business Leadership from Cambridge University in 1998.
Tony was appointed a non-executive Director of Halma in August 2014. He is a non-executive director of Dechra Pharmaceuticals PLC and was formerly the Senior Independent Director and remuneration committee chairman of Spirit Pub Company plc. Earlier in his career, Tony was chief executive officer of Cable & Wireless Communications plc, CEO of Tunstall Plc and held a number of senior roles in BAE Systems plc (including British Aerospace). Tony has a BA in Business Studies from City of London College, an MBA from Cranfield School of Management and is a member of both the Association of Corporate Treasurers and the Chartered Institute of Management Accountants.
Carole Cran was appointed a non-executive Director of Halma in January 2016. She is Chief Financial Officer at Aggreko plc having held a number of senior financial roles since joining Aggreko in 2004. Previously Carole spent seven years at BAE Systems, in a range of senior financial positions, including four years in Australia. Carole qualified as a Chartered Accountant with KPMG and has a degree in Accountancy from the University of Aberdeen.
The Company is required to appoint an auditor at every general meeting at which accounts are presented, to hold office until the conclusion of the next such meeting and the Directors are proposing the reappointment of Deloitte LLP as the Company's Auditor.
In accordance with standard practice, this resolution gives authority to the Directors to determine the Auditor's remuneration.
The Directors may only allot shares if authorised to do so by shareholders. The purpose of this resolution is to renew the Directors' authority.
The effect of this resolution will allow the Directors to allot and issue new shares up to a nominal aggregate value of £12,500,000, being just less than one third of the total issued share capital of the Company (excluding treasury shares) as at 13 June 2016 (the latest practicable date prior to the publication of the Notice of Meeting).
In accordance with the Directors' stated intention to seek annual renewal, the authority will expire at the conclusion of the annual general meeting of the Company in 2017. Passing this resolution will give the Directors flexibility to act in the best interests of shareholders, when opportunities arise, by issuing new shares. The Directors have no current plans to make use of this authority except under share plans previously approved in general meeting.
As at 13 June 2016 (the latest practicable date prior to the publication of the Notice of Meeting), the Company held 940,421 treasury shares, which is equal to approximately 0.2% of the issued share capital of the Company (excluding treasury shares) as at that date.
Resolutions 15 and 16 – Disapplication of pre-emption rights The 2006 Act requires that, if the Company issues new shares for cash or sells treasury shares, it must first offer them to existing shareholders in proportion to their current holdings.
The effect of resolution 15, which will be proposed as a special resolution, is to authorise the Directors to allot new shares pursuant to the authority given in resolution 14, or sell treasury shares for cash, up to an aggregate nominal amount of £1,890,000 (up to 18,900,000 ordinary shares) representing approximately 5% of the Company's issued share capital as at 13 June 2016 (being the latest practicable date prior to the publication of the Notice of Meeting) without offering them to shareholders first, and to modify statutory pre-emption rights to deal with legal, regulatory or practical problems that may arise on a rights or other pre-emptive offer or issue.
The effect of resolution 16, which will also be proposed as a special resolution, is to authorise the Directors to disapply statutory pre-emption rights in respect of an additional 5% of the Company's issued share capital as at 13 June 2016 (the latest practicable date prior to the publication of the Notice of Meeting). In accordance with the Pre-Emption Group's Principles, the Directors confirm that this authority will be used only in connection with an acquisition or specified capital investment that is announced contemporaneously with the issue, or that has taken place in the preceding six-month period and is disclosed in the announcement of the issue.
The authorities in resolution 15 and resolution 16 will expire at the conclusion of the annual general meeting of the Company in 2017.
Excluding any shares issued in connection with an acquisition or specified capital investment as described above, the Directors do not intend to issue more than 7.5% of the issued share capital for cash on a non-pre-emptive basis in any rolling three-year period.
The Directors were authorised at the 2015 annual general meeting to purchase up to 37,800,000 of the Company's own 10p ordinary shares in the market. This authority expires at the end of the 2016 AGM. In accordance with the Directors' stated intention to seek annual renewal, this resolution (which will be proposed as a special resolution) will renew this authority until the end of next year's annual general meeting in respect of up to 37,800,000 ordinary shares, which is approximately 10% of the Company's issued share capital (excluding treasury shares) as at 13 June 2016 (the latest practicable date prior to the publication of the Notice of Meeting).
The Directors consider it desirable that the possibility of making such purchases, under appropriate circumstances, is available. The authority, if granted, will only be exercised if market conditions make it advantageous to do so. The Directors will only make purchases under the authority where they believe that to do so would result in an increase in earnings per share for the remaining shareholders, or where the purchased shares are used to satisfy awards made under employee share plans, and such purchases are considered to be in the best interests of shareholders generally.
The Directors' present intention is that the shares purchased under the authority will be held in treasury for future cancellation, sale for cash or transfer for the purposes of, or pursuant to, an employee share plan, although in the light of circumstances at the time it may be decided to cancel them immediately on repurchase. The effect of any cancellation would be to reduce the number of shares in issue. For most purposes, while held in treasury, shares are treated as if they have been cancelled (for example, they carry no voting rights and do not rank for dividends).
As at 13 June 2016 (the latest practicable date prior to the publication of the Notice of Meeting) there were no options outstanding to subscribe for ordinary shares.
Changes made to the 2006 Act pursuant to the Shareholders' Rights Directive increase the minimum notice period required for general meetings of the Company to 21 days unless shareholders approve a shorter notice period, which cannot be less than 14 clear days. Annual general meetings continue to be held on at least 21 clear days' notice.
Before the Shareholders' Rights Directive came into force, the Company was able to call general meetings (other than annual general meetings) on 14 clear days' notice without obtaining such shareholder approval. In order to preserve this flexibility, resolution 18 seeks to renew the authority obtained at last year's annual general meeting. It is intended that a shorter notice period will not be used as a matter of routine for general meetings, but only if the flexibility would be helpful given the business of the meeting and where the Board thinks it is in the interest of shareholders as a whole. If the resolution is passed, the authority will be effective until the annual general meeting in 2017, when it is intended that a similar resolution will be proposed.
The Company offers the facility for shareholders to vote and appoint proxies by electronic means. This is accessible to all shareholders and would be available if the Company were to call meetings on 14 clear days' notice.
in each case so that it is received no later than 11.00am on 19 July 2016, being not less than 48 hours before the time fixed for the meeting.
(SRN) and PIN. Electronic proxy appointments must be received no later than 11.00am on 19 July 2016.
The statement of rights of shareholders in relation to the appointment of proxies in paragraphs 3 to 8 does not apply to Nominated Persons. The rights described in these paragraphs can only be exercised by shareholders of the Company.
If you have been nominated to receive general shareholder communications directly from the Company, it is important to remember that your main contact in terms of your investment remains as it was (so the registered shareholder, or perhaps custodian or broker, who administers the investment on your behalf). Therefore any changes or queries relating to your personal details and holding (including any administration thereof) must continue to be directed to your existing contact at your investment manager or custodian. The Company cannot guarantee dealing with matters that are directed to us in error. The only exception to this is where the Company, in exercising one of its powers under the 2006 Act, writes to you directly for a response.
previously appointed proxy must, in order to be valid, be transmitted so as to be received by the Company's agent, Computershare Investor Services PLC (ID 3RA50), by the latest time(s) for receipt of proxy appointments set out in note 5. 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 Company'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.
CREST members and, where applicable, their CREST sponsors or voting service providers, should note that Euroclear UK & Ireland Limited does not make available special procedures in CREST for any particular messages. 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/her CREST sponsor or voting service provider takes) 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 service providers) are referred, in particular, to those sections of the CREST Manual concerning practical limitations of the CREST system and timings.
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.
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 2006 Act. Where the Company is required to place a statement on a website under Section 527 of the 2006 Act, 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 AGM includes any statement that the Company has been required under Section 527 of the 2006 Act to publish on a website.
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