AGM Information • Mar 17, 2022
AGM Information
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THIS DOCUMENT IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION. If you are in any doubt as to the action you should take you are recommended to seek your own financial advice from your stockbroker, solicitor, accountant or other professional adviser authorised under the Financial Services and Markets Act 2000.
If you have sold or transferred all of your holding of ordinary shares in Drax Group plc please forward this document and the accompanying documents (but not the personalised Form of Proxy), as soon as possible, to the purchaser or the transferee or to the person through whom the sale or transfer was effected for transmission to the purchaser or the transferee.
TO BE HELD AT 12.30PM ON WEDNESDAY 27 APRIL 2022 AT etc.venues St Paul's, 200 Aldersgate, London EC1A 4HD
For shareholders, a Form of Proxy is enclosed with this document. Whether or not you propose to join the AGM remotely, you are requested to complete and submit a Form of Proxy to the Company's Registrars, Equiniti Limited, Aspect House, Spencer Road, Lancing, West Sussex BN99 6DA to arrive by no later than 12.30pm on Monday 25 April 2022.
If you hold shares in CREST you may appoint a proxy by completing and transmitting a CREST proxy instruction to Equiniti Limited (CREST participant ID RA19) so that it is received by no later than 12.30pm on Monday 25 April 2022.
| Contents | |
|---|---|
| This document contains: | Page |
| Part A Letter from the Chair | 1 |
| Part B Notice of the Annual General Meeting | 3 |
| Part C Explanatory notes to the Notice of the AGM | 5 |
| Part D Administrative notes relating to the AGM | 8 |
| Part E Definitions | 12 |
| Part F Skills and experience of the Board | 13 |
| Appendix 1 – Employee Stock Purchase Plan | 15 |
| Appendix 2 – Amendments to Long Term Incentive Plan rules | 16 |
| Appendix 3 – Information for the Day: User Guide to joining the AGM remotely | 17 |
| Latest time for receipt of Forms of Proxy and CREST proxy instructions to be valid at the AGM | 12.30pm on 25 April | |
|---|---|---|
| AGM | 12.30pm on 27 April | |
| Ordinary shares marked ex-final dividend | 28 April | |
| Record date for entitlement to the final dividend | 29 April | |
| Dispatch of the final dividend warrants and tax vouchers | 12 May | |
| Payment date for the final dividend | 13 May |
Registered Office: Drax Power Station Selby North Yorkshire YO8 8PH Registered in England and Wales Number 5562053
Philip Cox CBE (Chair) Will Gardiner (CEO) Andy Skelton (CFO) John Baxter CBE Nicola Hodson Kim Keating David Nussbaum Erika Peterman Vanessa Simms
I am pleased to enclose the Notice of the AGM of Drax Group plc (the Company or Drax), which will be held at 12.30pm on Wednesday 27 April 2022 at etc.venues St Paul's, 200 Aldersgate, London EC1A 4HD. The Notice of the AGM is set out in Part B on pages 3 and 4.
After two years where restrictions have prohibited us from holding a face-to-face AGM, I am very pleased to be able to invite you attend the meeting either in person or remotely by logging on to web.lumiagm.com. A user guide detailing the arrangements to join and submit questions at the meeting remotely is set out in Appendix 3 on pages 17 and 18.
We remain vigilant to the continuing changes in response to the Covid-19 pandemic and therefore whilst we hope and plan for a face-to-face meeting, we accept this may be subject to change. As in the past, should that change, we would expect to provide updated information via RNS announcement, our website and where time permits through notification to shareholders in accordance with the usual means for advising you.
Your vote is important to us. All votes will be by poll, which means that each share carries one vote and all votes count, and we strongly encourage you to vote in advance or to appoint the Chair as your proxy by submitting your enclosed Form of Proxy by post or electronically as further detailed in Part D on pages 8 to 11.
The explanatory notes to the Resolutions are set out in Part C on pages 5 to 7.
A copy of the Company's Annual Report and Accounts for the year ended 31 December 2021 is now available on our website at www.drax.com. Our website is one of the means by which we communicate with our shareholders. As well as the Annual Report and Accounts, you can find further information including information about our carbon negative ambitions and progress, our approach to sustainability, the latest news and press releases, investor presentations and dividend history. You can sign up for news alerts about Drax on our website www.drax.com by selecting 'Subscribe'.
If you have requested to receive a hard copy of the Annual Report and Accounts, this is enclosed. If you no longer wish to receive a hard copy, and instead wish to receive communications electronically, please contact our Registrar, Equiniti, on 0371 384 2030 from within the UK or +44 121 415 7047 from outside the UK.
Ordinary shareholders
Whether or not you propose to attend the AGM in person or remotely, you are requested to:
If you hold shares in CREST you may appoint a proxy by completing and transmitting a CREST proxy instruction to Equiniti Limited (CREST participant ID RA19) so that it is received by no later than 12.30pm on Monday 25 April 2022.
Voting on each of the Resolutions to be put to the AGM will be by poll so that all votes are included whether or not the shareholder is able to attend the meeting.
The results of the voting at the meeting will be announced to the London Stock Exchange as soon as practicable following the meeting and will also appear on the Company's website www.drax.com.
The Company has included on the Form of Proxy, and the Form of Direction, a "vote withheld" option in order for shareholders to abstain from voting on any particular Resolution. However, an abstention is not a vote in law and will not be counted in the calculation of the proportion of votes "For" or "Against" the relevant Resolution.
The Directors of the Company consider that the Resolutions to be put to shareholders at the AGM are in the best interests of the Company and its members as a whole.
Accordingly, the Directors unanimously recommend that you vote in favour of all the proposed Resolutions as they intend to do so in respect of their own beneficial interests.
Yours sincerely
Philip Cox CBE Chair
Notice is hereby given that the Annual General Meeting (AGM) of Drax Group plc (the Company) will be held at 12.30pm on Wednesday 27 April 2022 at etc.venues St Paul's, 200 Aldersgate, London EC1A 4HD.
The shareholders of the Company are asked to consider and, if thought fit, pass Resolutions 1 to 16 and Resolutions 19 and 20 as ordinary Resolutions, and to consider and, if thought fit, pass Resolutions 17, 18 and 21 as special Resolutions.
in each case provided that the aggregate amount of any such donations and expenditure shall not exceed £125,000.
This authority shall commence on the date of the passing of this Resolution and remain in force until the conclusion of the 2023 AGM (or, if earlier, until the close of business on 30 June 2023).
The authorities conferred on the Directors under paragraphs (a) and (b) above shall commence on the date of the passing of this Resolution and remain in force until the conclusion of the 2023 AGM (or, if earlier, until the close of business on 30 June 2023), save that under each authority the Company may, before such expiry, make an offer or agreement which would or might require shares to be allotted or rights to subscribe for, or to convert any security into, shares to be granted after such expiry and the Directors may allot shares or grant rights to subscribe for, or to convert any security into, shares (as the case may be) in pursuance of such an offer or agreement as if the relevant authority conferred hereby had not expired.
Section 561(1) CA 2006 did not apply to any such allotment, provided that this power:
The powers conferred under paragraphs (a) and (b) above shall commence on the date of the passing of this Resolution and remain in force until the conclusion of the 2023 AGM (or, if earlier, until the close of business on 30 June 2023), save that the Company may, before such expiry, make an offer or agreement which would or might require equity securities to be allotted after such expiry and the Directors may allot equity securities in pursuance of such offer or agreement as if the power conferred hereby had not expired.
preceding the date on which that ordinary share is contracted to be purchased; and
By order of the Board
Group Company Secretary, Drax Group plc, Drax Power Station, Selby, North Yorkshire YO8 8PH 17 March 2022
The Directors are required to present to the meeting the Annual Report and Accounts for the financial year ended 31 December 2021. This includes (i) the audited accounts; (ii) the Directors' report; (iii) the Strategic report; and (iv) the report of the auditor of the Company on the audited accounts and the auditable part of the Directors' Remuneration Report. A separate Resolution seeks approval by the shareholders of the Directors' Remuneration Report, which vote is advisory in nature.
Resolution 2 seeks shareholder approval for the annual statement to shareholders by the Chair of the Remuneration Committee and the Annual Report on Remuneration which can be found on pages 130 to 159 of the Annual Report and Accounts. The Annual Report on Remuneration gives details of the implementation of the Company's existing Directors' Remuneration Policy in terms of the payments and share awards made to the Directors in connection with their performance and that of the Company during the year ended 31 December 2021. This vote is advisory and will not affect the way in which the Directors' Remuneration Policy has been implemented.
The Company's auditor during the year, Deloitte LLP, has audited those parts of the Directors' Remuneration Report that are required to be audited and their report can be found on pages 169 to 177 of the Annual Report and Accounts.
Resolution 3 seeks shareholder approval to pay the final dividend of 11.3 pence per ordinary share, which is recommended by the Directors for payment to those shareholders who are on the Register of the Company at 6.30pm on 29 April 2022. If approved by shareholders at the AGM, the final dividend will be paid on 13 May 2022.
The Company's articles of association provide that any new Director appointed by the Board during the year may hold office only until the next AGM, when that Director must retire but shall be eligible for election as a Director by the shareholders at that meeting. Erika Peterman and Kim Keating have joined the Board since the last AGM, having both been appointed by the Board on 21 October 2021, and are accordingly seeking appointment by shareholders.
In accordance with the Company's articles of association, and in line with the recommendations of the UK Corporate Governance Code (the Code), each of the other Directors will retire and offer themselves for re-election by shareholders.
The skills and experience for each of the Directors are set out in Part F of this Notice (and on pages 97 to 99 of the Annual Report and Accounts).
The Board has determined that all of the Non-Executive Directors being proposed for election or re-election are independent in character and judgement, and there are no relationships or circumstances which are likely to affect, or could appear to affect, their independence.
Following the internally conducted evaluations during 2021, the Board is satisfied that the performance of each Director standing for election or re-election continues to be effective and that each Director continues to demonstrate commitment to the role.
The Company must appoint or re-appoint an auditor at every general meeting at which accounts are presented and it is normal practice for the Company's Directors, acting through the Audit Committee, to be authorised to determine the auditor's remuneration.
The Board further recommend that Deloitte LLP be appointed as auditor of the Company for the year ending 31 December 2022. Deloitte LLP has advised its willingness to continue in office as auditor of the Company.
Part 14 of the Companies Act 2006 (CA 2006) contains restrictions on companies making political donations or incurring political expenditure.
Drax is a politically neutral organisation and did not make any political donations in 2021.
It is not the policy of the Company to make donations to political parties, and the Directors have no intention of changing that policy. However, the CA 2006 defines political donations and political expenditure terms very widely. This means that activities that form part of the normal relationship between the Company and bodies concerned with policy review, law reform and other business matters affecting the Company, which might not be thought to be political expenditure in the usual sense, could require shareholders' consent under the Act.
In view of the broad wording adopted in the CA 2006, and the Board's wish to avoid any inadvertent infringement of it, it is seeking shareholders' consent for the Company, and any wholly owned subsidiary company, to incur total annual expenditure for such purposes, provided that the aggregate amount of any such donations and expenditure shall not exceed £125,000, in order that the Company may continue to engage with regulators and policymakers without inadvertently breaching the applicable legislation. Further information on how the Company engaged with political parties in 2021 can be found on pages 39 and 162 of our Annual Report and Accounts, and our Political Engagement Policy is available on our website at www.drax.com.
It is the intention that the Company will seek to renew this authority, if appropriate, at each subsequent AGM.
The authority given to the Directors to allot further shares in the capital of the Company requires the prior authorisation of the shareholders in general meeting under Section 551 CA 2006. Upon the passing of Resolution 16 the Directors will have authority (pursuant to paragraph (a) of the Resolution) to allot shares up to an aggregate nominal value of £15,372,523, which is approximately one-third of the issued ordinary share capital as at 1 March 2022 (being the latest practicable date before the publication of this Notice). This authority will expire immediately following the AGM in 2023 or on 30 June 2023, whichever is the earlier.
In addition, in accordance with the Investment Association Share Capital Management Guidelines (which set out the expectations of institutional investors in relation to, among other things, the authority of Directors to allot shares), upon the passing of Resolution 16, the Directors will have authority (pursuant to paragraph (b) of the Resolution) to allot ordinary shares in connection with a rights issue in favour of ordinary shareholders up to a maximum nominal value of £30,745,047, as reduced by the nominal amount of any shares issued under paragraph (a) of Resolution 16.
This amount (before any reduction) represents approximately two-thirds of the Company's issued ordinary share capital as at 1 March 2022 (being the latest practicable date before the publication of this Notice). This authority will also expire immediately following the next AGM or on 30 June 2023, whichever is the earlier. As a result, if Resolution 16 is passed, the Directors could allot shares representing up to two-thirds of the Company's current issued share capital pursuant to a rights issue.
The Directors will continue to seek to renew these authorities at each AGM, in accordance with current best practice from time to time. The Directors have no current plans to exercise this authority except in connection with employee share plans.
As at 1 March 2022, being the latest practicable date before publication of this Notice, the Company held 13,841,295 equity securities in treasury.
If the Directors wish to exercise the authority under Resolution 16 and offer shares (or sell any shares which the Company may purchase and elect to hold as treasury shares) for cash, the CA 2006 requires that, unless shareholders have given specific authority for the waiver of their statutory pre-emption rights, the new shares must be offered first to existing shareholders in proportion to their existing shareholdings. In certain circumstances, it may be in the best interests of the Company to allot new shares (or to grant rights over shares) for cash without first offering them to existing shareholders in proportion to their holdings.
Resolution 17 would authorise the Directors to do this by allowing the Directors to allot shares for cash (i) by way of a rights issue (subject to certain exclusions), (ii) by way of an open offer or other offer of securities (not being a rights issue) in favour of existing shareholders in proportion (as nearly as may
be) to their shareholdings (subject to certain exclusions) and (iii) otherwise than under (i) or (ii), up to an aggregate nominal value of £2,305,878 which is equivalent to approximately 5% of the issued ordinary share capital of the Company on 1 March 2022 (being the latest practicable date prior to the publication of this Notice). The Resolution also applies to the sale and re-issue of ordinary shares held as treasury shares by the Company.
If approved by the shareholders, the authority contained in Resolution 17 will expire on the earlier of the conclusion of the next AGM or on 30 June 2023. The Directors intend to renew such power at successive AGMs in accordance with current best practice.
The Directors have no current plans to exercise this authority except in connection with employee share plans (but they consider its approval to be appropriate in order to preserve maximum flexibility for the future).
In addition, and in line with best practice, the Company has not issued more than 7.5% of its issued share capital on a non-preemptive basis over the last three years. In accordance with the Pre-Emption Group's Statement of Principles regarding cumulative usage of authorities, the Directors do not intend to issue more than 7.5% of the issued ordinary share capital of the Company (excluding treasury shares) for cash on a non-preemptive basis in any rolling three-year period without prior consultation with shareholders.
As at 1 March 2022, being the latest practicable date before the publication of this Notice, the Company held 13,841,295 equity securities in treasury.
Resolution 18 is to authorise the Company to buy back up to 41,306,803 ordinary shares. The authority would expire at the conclusion of the 2023 AGM or, if earlier, on 30 June 2023. The Directors intend to seek renewal of this power at subsequent AGMs in accordance with current best practice.
Resolution 18 specifies the maximum number of ordinary shares which may be purchased (representing 10% of the Company's issued ordinary share capital as at 1 March 2022) and the maximum and minimum prices at which they may be bought, exclusive of expenses, reflecting the requirements of the CA 2006 and the Listing Rules.
The Directors have no present intention of exercising this authority other than with a view for use in relation to employee share plans or where it is appropriate to conduct buy backs to return value to shareholders. The granting of this authority should not be taken to imply that any ordinary shares will be purchased, other than in relation to the above. Except in relation to the above, no purchase of ordinary shares will be made unless it is expected that the effect will be to increase earnings per share and the Directors consider it to be in the best interests of shareholders.
Under the CA 2006, the Company is allowed to hold its own shares in treasury following a buy back, instead of having to cancel them. This gives the Company the ability to re-issue treasury shares quickly and cost-effectively (including pursuant to the authority under Resolution 16 above) and provides the
Company with additional flexibility in the management of its capital base. The Company currently holds 13,841,295 shares in treasury following a buy back programme between April 2018 and January 2019.
Such shares may be re-sold for cash but all rights attaching to them, including voting rights and any right to receive dividends, are suspended whilst they are held in treasury. If the Directors exercise the authority conferred by Resolution 18, the Company will have the option of either holding in treasury or of cancelling any of its own shares purchased pursuant to this authority and will decide at the time of purchase which option to pursue.
The total number of options to subscribe for, and awards over, shares, outstanding at 1 March 2022, being the last practicable date before the publication of this Notice was 16,909,931. This represents approximately 4.09% of the issued share capital at that date. If the Company was to buy back the maximum number of ordinary shares permitted pursuant to this Resolution then the total number of options to subscribe for ordinary shares, outstanding at 1 March 2022, would represent approximately 4.55% of the reduced share capital.
The Group has for many years operated employee share plans for employees, which have primarily been used for awards to employees in the United Kingdom. Given the expansion of the Group's operations internationally, and in particular its acquisition of Pinnacle Renewable Energy, Inc., the Company wishes to have greater flexibility to be able to make awards of shares (or cash-based equivalent awards) to employees outside the United Kingdom. The Board is therefore seeking shareholder approval for the establishment of a new all-employee share purchase plan (the ESPP) and for amendments to the LTIP.
Resolution 19 seeks shareholder approval for the ESPP, the principal terms of which are summarised in Appendix 1 to the Notice of AGM.
A UK Sharesave plan has operated for many years in the UK and it is popular with employees and achieves strong participation. In order to have the flexibility to offer similar opportunities to employees internationally, in particular in the US and Canada, the Company is proposing to establish the new ESPP under which eligible employees of the Company and certain of its subsidiaries are awarded options to purchase ordinary shares of the Company with a 15% discount to market value. The ESPP has two parts: one part for employees in the US, which is designed to qualify under section 423 of the US Internal Revenue Code of 1986, as amended; and the other part for employees in Canada. The ESPP may also be used to make awards to employees of subsidiary undertakings, associated undertakings or related undertakings of the Company and to provide share-based awards in cash where the grant of shares is impracticable or not permitted. If passed, Resolution 19 will also enable the Company to add subplans to the ESPP or establish further plans based on the ESPP to enable the grant of options and awards to employees in overseas territories, taking account of local tax, exchange control and securities law issues in the relevant jurisdiction.
Resolution 20 seeks shareholder approval to amend the rules of the LTIP to take account of the variety of entities with employees working for the Group, particularly outside the UK, which include limited liability companies, limited partnerships, joint ventures and associated entities. The proposed amendments to the LTIP rules are summarised in Appendix 2 to the Notice of AGM.
The rules of the LTIP currently permit awards to be granted to employees of the Company and its subsidiaries. In order to provide greater flexibility, the Company is seeking shareholder approval to amend the LTIP rules so that share awards (and share-based awards in cash) may also be granted to and held by employees of subsidiary undertakings, associated undertakings and related undertakings of the Company. The Board believes that this change will provide an opportunity to offer sharebased incentives to attract, incentivise and retain relevant employees.
Resolution 21 is a Resolution to allow the Company to hold general meetings (other than AGMs) on 14 clear days' notice.
The Shareholders' Rights Regulations state that the notice period required for general meetings of the Company is 21 days, unless shareholders approve a shorter notice period, which cannot, however, be less than 14 clear days. AGMs will continue to be held on at least 21 clear days' notice.
In order to preserve the Company's ability to call general meetings (other than an AGM) on 14 clear days' notice, Resolution 21 seeks such approval. The shorter notice period would not be used as a matter of routine for such meetings, but only where the flexibility is merited by the business of the meeting and is thought to be to the advantage of shareholders as a whole.
The CA 2006 requires that, in order to be able to call a general meeting on less than 21 clear days' notice, the Company must make a means of electronic voting available to all shareholders for that meeting. The Company provides this facility (see paragraph 19 of Part D on page 9 of this document for the Company's arrangements for electronic proxy appointments).
regarding any changes or queries relating to the Nominated Person's personal details and interest in the Company (including any administrative matter). The only exception to this is where the Company expressly requests a response from a Nominated Person.
The draft rules of the Drax Group plc 2022 Employee Stock Purchase Plan (ESPP) and the amended rules of the Drax Group plc Long Term Incentive Plan 2020 (LTIP) will be available for inspection on the National Storage Mechanism at https://data.fca.org.uk/#/nsm/nationalstoragemechanism from the date of sending this document. The draft rules of the ESPP and the amended rules of the LTIP will also be on display at the place of the AGM for at least 15 minutes before the AGM and during the AGM
The telephone helpline service will be available between 8.30am and 5.30pm Monday to Friday – excluding public holidays in England and Wales.
The telephone helpline service will not be able to provide legal, financial or personal taxation advice. Calls may be recorded and randomly monitored for security and training purposes.
The following definitions apply throughout this document and in the accompanying Form of Proxy, unless the context requires otherwise:
| "Annual General Meeting" or "AGM" or "meeting" | the Annual General Meeting of the Company to be held at 12.30pm on 27 April 2022 (and any adjournment thereof) |
|---|---|
| "Board" or "Directors" | the Directors of Drax Group plc |
| "CA 2006" | Companies Act 2006 |
| "Code" | UK Corporate Governance Code 2018 |
| "Company" or "Drax Group" or "Drax" | Drax Group plc |
| "Company's Registrars" | Equiniti Limited, Aspect House, Spencer Road, Lancing, West Sussex BN99 6DA |
| "CREST" | the relevant systems (as defined in the CREST Regulations) in respect of which Euroclear UK & Ireland Limited is the Operator (as defined in such regulations) |
| "CREST Regulations" | the Uncertificated Securities Regulations 2001 (SI 2001 No. 3755) |
| "Form of Proxy" | the proxy form enclosed with this document for use by shareholders to vote on Resolutions to be put to the AGM |
| "London Stock Exchange" | London Stock Exchange plc |
| "Official List" | the official list of the UK Listing Authority |
| "ordinary shares" | ordinary shares with nominal value of 11 16⁄29 pence each in the capital of the Company |
| "Register" | the register of members of the Company |
| "Resolutions" | the Resolutions set out in the notice convening the AGM |
| "shareholders" or "members" | holders of ordinary shares |
| "UK Listing Authority" | the Financial Conduct Authority acting in its capacity as the competent authority for the purposes of Part VI of the Financial Services and Markets Act 2000 |
| "UK" | the United Kingdom of Great Britain and Northern Ireland |
Philip is an experienced leader of large businesses, having held both executive and non-executive roles, including in the energy sector. As Chair, Philip cultivates a culture of openness, transparency and honesty in which constructive debate and challenge occurs and in which all directors contribute fully. His responsibilities at Drax include Board composition and succession, Board governance and stakeholder engagement.
He was previously CEO of International Power plc, having formerly been CFO. Prior to this he held a senior operational position at Invensys plc and was CFO at Siebe plc. As a nonexecutive he was previously Chair of Kier Group plc, the Senior Independent Director at Wm Morrison Supermarkets plc, Chair of Global Power Generation and a member of the boards of Talen Energy Corporation, PPL, Meggitt plc and Wincanton plc. Philip is a Fellow of the Institute of Chartered Accountants and has an MA from Cambridge University.
Appointment to the Board: January 2015
Appointment as Chair: April 2015
Will has a strong track record of building and leading wellmanaged companies and creating value. He has been a key architect of our purpose and strategy, driving the sustainability agenda from the top, including Drax's response to the climate change crisis, and ensuring that we are delivering for our stakeholders. He provides leadership of the executive team and takes responsibility for important external relationships and stakeholder management. Will is also a non-executive board member of the Sustainable Biomass Program.
Will joined Drax in 2015 as CFO and was appointed as CEO in January 2018. He has a wealth of experience in finance and technology, having held CFO and divisional Finance Director roles at a number of major companies, including CSR plc (acquired by Qualcomm, Inc in 2015) and Sky. He has dual US-UK citizenship and has lived and worked in the UK since 1998.
Appointment to the Board: November 2015
Andy has over 20 years of strong finance and commercial skills, alongside substantial experience in the technology sector. Since joining Drax three years ago he has driven efficiency and operational excellence across the Group to provide a sound framework from which we can deliver our purpose and strategy. Andy is responsible for financial control and planning, corporate finance, investor relations, tax, IT, procurement, strategy, mergers and acquisitions, risk, and internal audit. He also represents Drax as a board member of the Northern Powerhouse Partnership.
Andy was previously CFO at Fidessa Group plc and has held a number of senior finance positions at CSR plc, Ericsson and Marconi, including two years as CFO of Ericsson Nikola Tesla. Andy has a BA in accounting and finance and qualified as a chartered accountant in 1994.
Appointment to the Board: January 2019
John brings to Drax highly valuable engineering, health and safety, and energy generation experience, with over 45 years working across the nuclear, electricity, oil and gas sectors.
John was previously at BP plc, most recently as Group Head of Engineering & Process Safety, prior to which he worked at the UK utility Powergen plc as Group Engineering Director, as well as roles as a UKAEA Board member and also as a nuclear submarine engineer officer. He is a non-executive Director of Sellafield Ltd and chairs the Sellafield Board Committee on Environment, Health, Safety & Security.
He is a Chartered Engineer, Fellow of both the Royal Academy of Engineering and the Royal Society of Edinburgh. John was President of both the Institution of Mechanical Engineers and The Welding Institute.
Appointment to the Board: April 2019
Nicola brings valuable technology expertise, as well as having extensive experience in business and digital transformation, sales and IT in leading global companies. As Chair of the Remuneration Committee Nicola brings to the role a wide range of experience of international business, government organisations, and dealing with a variety of stakeholders.
She is currently Vice-President, Global Sales and Marketing, Field Transformation at Microsoft, and was Chief Operating Officer of Microsoft UK. Previously she had P&L and sales roles at Siemens, CSC (now DXC) and EY. Nicola is a Non-Executive Director of Beazley plc.
Appointment to the Board: January 2018
David's extensive experience in international development and environmental matters, in addition to his prior experience as Finance Director of a UK listed industrial company, is of significant value to Drax and contributes to the Board's discussions and understanding in the perspectives of and engagement undertaken with stakeholders.
David holds a portfolio of other Board appointments, including at the Value Reporting Foundation and the International Budget Partnership, and is a member of the Ethical Investment Advisory Group of the Church of England, and is Chair of the Advisory Council of Transparency International UK.
His executive career has included being the Chief Executive of The Elders, of WWF-UK and of Transparency International. He was previously Finance Director and Deputy CEO of Oxfam, and Finance Director of Field Group plc. In a non-executive capacity, David has been Deputy Chair of Shared Interest Society, Chair of Traidcraft plc and a non-executive director of Low Carbon Accelerator Limited.
David is a chartered accountant, and has Masters in Theology from both Cambridge and Edinburgh universities and a Masters in Finance from the London Business School.
Appointment to the Board: August 2017
Vanessa has extensive experience in senior finance roles across several different, and capital intensive, industries, including real estate, medical devices and telecommunications.
Her broad and varied experience in strategic capital allocation, finance, risk and internal control is invaluable in her role as Chair of the Audit Committee.
Vanessa is CFO of Land Securities Group plc, and has worked in finance for over 20 years. Prior to her role at Land Securities Group plc, Vanessa was CFO of Grainger plc, held a number of senior positions within Unite Group plc, including Deputy Chief Financial Officer, and was UK finance director at SEGRO plc.
Vanessa is a Fellow of the Association of Chartered Certified Accountants and has an Executive MBA from Ashridge.
Appointment to the Board: June 2018
Kim is a Professional Engineer with 25 years of broad international experience in the oil and gas, nuclear, hydropower, and mining sectors. Most recently, Kim was the Chief Operating Officer of the Cahill Group, one of Canada's largest multi-disciplinary construction companies with operations across the country.
Prior to joining the Cahill Group in 2013, Kim held a variety of progressive leadership roles from engineering design through to construction, commissioning, production operations and offshore field development with Petro-Canada (now Suncor Energy Inc.).
Kim is currently a non-executive director of Yamana Gold Inc. and Major Drilling International Inc. She has led a range of innovative growth initiatives including climate change and renewable energy strategies. Kim is a Fellow of the Canadian Academy of Engineering, holds a Bachelor of Civil Engineering degree and an MBA. She also holds the Canadian Registered Safety Professional (CRSP) designation.
Kim is also a founding member of Makwa-Cahill Limited Partnership, a nuclear qualified indigenous fabrication company. She graduated from the Rotman-Institute of Corporate Directors Education Program and was awarded her ICD.D designation.
Appointment to the Board: October 2021
Erika brings extensive experience gained from more than 25 years working in global organisations, enabling the delivery of change and growth in complex, world-leading businesses. She brings broad knowledge serving various parts of the chemicals industry, across a range of sectors from plastics, petrochemicals, agriculture and pharma.
Erika is currently Senior Vice President at BASF Corporation where she leads the North American Chemical Intermediates business. Erika has held a number of management and senior executive roles with BASF, covering manufacturing and production, engineering, strategy, and commercial business management roles. She actively supports BASF's talent and workforce development programmes as well as a range of their diversity and inclusion initiatives.
Erika serves on the University of Houston's Engineering Leadership Advisory Board and chairs the Planning Committee as Board Trustee at Chatfield College in Cincinnati, Ohio. She is a member of the Executive Leadership Council, a non-profit whose mission is to globally accelerate the development of successful black executives across the lifecycle of their careers. Erika holds a BSc in chemical engineering from the Georgia Institute of Technology and an MBA from the University of Houston.
Appointment to the Board: October 2021
This appendix sets out the principal terms of the Drax Group plc 2022 Employee Stock Purchase Plan ("ESPP") which is being put to shareholders at the AGM for approval by Resolution 19.
The ESPP is an all-employee stock purchase plan under which eligible employees are awarded options over ordinary shares of the Company ("ESPP Options"). The ESPP has two parts; one part for employees in the US (the "US ESPP"); and the other part for employees in Canada (the "Canada ESPP"). The US ESPP is designed to qualify under section 423 of the US Internal Revenue Code of 1986, as amended (the "Code"), giving eligible US participants certain tax benefits on gains made under the ESPP. The Board of Directors of the Company or a duly authorised committee (the "Board") will supervise the operation of the ESPP.
Defined terms in this explanation are derived from the rules of the ESPP, which members are being asked to approve.
Generally, all employees of any US or Canadian subsidiary of the Company which is designated by the Board as a participating company in the ESPP, meeting any relevant service requirement specified under the ESPP, will be eligible to participate in the ESPP and to receive an ESPP Option. Employees of a subsidiary undertaking, associated undertaking or related undertaking or entity of the Company designated as a participating employer (a "related employer") may also be offered participation in the ESPP.
Employees who are citizens or residents of a non-US jurisdiction may be excluded from participation in the US ESPP if such employees' participation would violate the laws of the applicable jurisdiction or if complying with the laws of the applicable jurisdiction would cause the US ESPP to violate section 423 of the Code. The Board may impose additional eligibility requirements to the extent permitted by law. From time to time, the Company may invite eligible employees to take part in an Offering under the ESPP. Invitations and grants of ESPP Options may be made at any time, subject to any applicable restrictions under relevant legislation or regulations.
Where the Company makes offers under the ESPP, ESPP Options are granted at the beginning of a specific offering period to those employees who have enrolled in the ESPP for that Offering Period. The Offering Period cannot exceed 27 months. The Board may not grant ESPP Options more than 10 years after the date of the approval of the ESPP by shareholders.
The price payable for each share underlying an ESPP Option shall be determined by the Board, provided that the purchase price is not less than 85 per cent of the fair market value of a share on the first day of the Offering Period or on the date at the end of the Offering Period on which the shares are purchased, whichever is the lower.
Participants enrol in the ESPP by authorising payroll deductions from their salary during the relevant Offering Period. For the US ESPP, under section 423 of the Code, participants may not be granted ESPP Options in any 12-month period over shares worth in excess of US\$25,000 (measured at the time of grant). For the Canada ESPP, participants may not be granted ESPP Options in
any 12-month period over shares worth in excess of the Canadian equivalent of US\$25,000 (measured at the time of grant). The Company may for any given Offering Period at the time of invitation set a lower limit and may on receipt of applications for participation, scale back salary deductions. Participants are entitled to cease their payroll deductions at any time during an Offering Period and may in certain circumstances be permitted to change the amount of their payroll deductions.
The ESPP may operate over new issue shares, treasury shares or shares purchased in the market. The rules of the ESPP provide that, in any period of 10 calendar years, not more than 10% of the Company's issued ordinary share capital may be issued under the ESPP and under any employees' share scheme operated by the Company. Shares issued out of treasury under the ESPP will count towards this limit for so long as this is required under institutional shareholder guidelines. Options and awards which are renounced or lapse shall be disregarded for the purposes of this limit.
In addition, the maximum total number of shares which may be used in connection with the ESPP, whatever the source of the shares, is 20,000,000 ordinary shares. This figure corresponds to approximately 5% of the Company's issued share capital as at 1 March 2022 but the actual number of ordinary shares which will be used under the ESPP is expected to be substantially less than this number. This number may be subject to adjustment in the event of certain changes to the corporate structure of the Company.
Provided the participant is still an eligible employee of a participating subsidiary or relevant participating related employer at the end of an offering period, the participant's ESPP Option may be exercised using the accumulated payroll deductions to purchase the maximum whole number of shares possible.
If a participant ceases to be employed by the Company or a participating subsidiary or relevant participating related employer of the Company for any reason, their ESPP Options will lapse and any accumulated payroll deductions that have not been used to buy shares under the ESPP during the offering period shall be returned to the participant or, in the case of cessation of employment due to death, returned to the personal representatives of the participant.
In the event of a change of control, winding-up or merger of the Company and certain other corporate events, the Board may decide whether the offering period shall be shortened and the date of exercise and subsequent purchase of shares will be brought forward or ESPP Options shall be cancelled and the accumulated payroll deductions returned to the participants. In certain circumstances, the ESPP Options may be replaced with options of an equivalent value in the relevant acquiring company.
The opportunity to be granted an ESPP Option is personal to participants and neither the opportunity nor any rights granted in relation to it may be transferred, assigned, pledged, charged or otherwise disposed of.
If there is a variation of share capital of the Company, the Board may make such adjustments to the number of shares underlying ESPP Options and the price payable for each share underlying such ESPP Options in such manner as the Board determines appropriate.
Shares issued and/or transferred under the ESPP will not confer any rights on any participant until the relevant ESPP Option has been exercised and the participant in question has received the underlying shares. Any shares allotted when an ESPP Option is exercised will rank equally in all respects and as one class with shares then in issue (except for rights arising by reference to a record date prior to their issue).
The Board may establish a sub-plan to the ESPP to permit the grant of cash awards to employees in jurisdictions where the Board determines it is not practicable to offer shares on the basis that participants will receive a cash payment by reference to a number of notional shares. The provisions of the ESPP rules will apply to such cash awards subject to consequential modifications.
Amendments to the ESPP rules may be made at the discretion of the Board. However, the provisions governing eligibility requirements, individual or overall limits, the basis for determining a participant's entitlement to shares and the terms on which they are acquired and the adjustments that may be made following a rights issue or any other variation of capital and the limitations on the number of shares that may be issued or made available under the ESPP cannot be altered to the advantage of participants without prior shareholder approval, except for minor amendments to benefit the administration of the ESPP, to take account of a change in legislation or to obtain or maintain favourable tax, exchange control or regulatory treatment for participants or for the Company or any member of its Group.
Amendments may not normally materially adversely affect the rights of participants except where participants are notified of such amendment and the majority of participants approve such amendment.
The Board may, at any time, establish further plans based on the ESPP for overseas territories but modified to take account of local tax, exchange control or securities laws. Any shares made available under such further overseas plans must be treated as counting against the limits on individual and overall participation under the ESPP.
Any ESPP Options granted, shares purchased or income recognised in connection with the ESPP are non-pensionable.
To approve amendments to the Drax Group plc Long Term Incentive Plan 2020 (LTIP)
Resolution 20 seeks shareholder approval to amend the rules of the LTIP to take account of the variety of entities with employees working for the Group, particularly outside the UK, which include limited liability companies, limited partnerships, joint ventures and associated entities.
The rules of the LTIP currently permit awards to be granted only to employees of the Company and its subsidiaries. In order to provide greater flexibility, the Company is seeking shareholder approval to amend the LTIP rules so that share awards (and share-based awards in cash) may also be granted to and held by employees of subsidiary undertakings, associated undertakings and related undertakings and entities of the Company.
In addition, it is proposed that the rules of the LTIP will be amended so that participants who remain in employment with any such employing entities will be treated as remaining in employment with the Group.
For the Annual General Meeting, Drax Group plc will be enabling members to join the meeting electronically, should they wish to do so. This can be done by accessing the AGM website, https:// web.lumiagm.com.
Lumi AGM can be accessed online using most well-known internet browsers such as Edge, Chrome, Firefox and Safari on a PC, laptop or internet-enabled device such as a tablet or smartphone. If you wish to join the AGM using this method, please go to https://web.lumiagm.com on the day.
On accessing the AGM website, you will be asked to enter a Meeting ID which is 129-877-982.
You will then be prompted to enter your unique Shareholder Reference Number (SRN) and PIN which is the first two and last two digits of your SRN. These can be found printed on your form of proxy. Access to the meeting via the website will be available from 11:30am on 27 April 2022.
The meeting will be broadcast with presentation slides. Once logged in, and at the commencement of the meeting, you will be able to listen to the proceedings of the meeting on your device, as well as being able to see the slides of the meeting which will include the Resolutions to be put forward to the meeting, these slides will progress automatically as the meeting progresses.
Members joining electronically may ask questions via the website by typing and submitting their question in writing.Select the messaging icon from within the navigation bar and type your question at the top of the screen, once finished, press the 'send' icon to the right of the message box to submit your question.
An active internet connection is required in order to allow you to submit questions and listen to the audiocast. It is the user's responsibility to ensure you remain connected for the duration of the meeting.
Please contact the Company's Registrar before 12:30pm on 25 April 2022 on 0371 684 2030 or +44(0) 121 415 7047 if you are calling from outside the UK for your SRN and PIN.
Lines are open 8.30am to 5.30pm Monday to Friday (excluding public holidays in England & Wales).
Open the Lumi AGM website and you will be prompted to enter the Meeting ID. If a shareholder attempts to login to the website before the meeting is live*, a pop-up dialogue box will appear.
After entering the Meeting ID, you will be prompted to enter your unique SRN and PIN (see "Logging In" on page 17).
When successfully authenticated, you will be taken to the Home Screen.
* 12:30pm on 27 April 2022
To view the meeting presentation, expand the "Broadcast Panel", located at the bottom of your device. If viewing through a browser, it will appear automatically.
This can be minimised by pressing the
If you would like to ask a question, select the messaging icon.
Type your message within the chat box at the bottom of the messaging screen.
Click the send button to submit.
same button.
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