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HARWORTH GROUP PLC

Pre-Annual General Meeting Information Apr 22, 2021

4737_agm-r_2021-04-22_e82caf7b-a8b5-419d-96ad-a86165537668.pdf

Pre-Annual General Meeting Information

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THIS DOCUMENT IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION. If you are in any doubt as to what action you should take, you are recommended to seek your own advice from an appropriate professional adviser who is authorised under the Financial Services and Markets Act 2000.

If you have sold or otherwise transferred all your shares in Harworth Group plc, please send this document and the accompanying documents 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.

Harworth

HARWORTH GROUP PLC

Registered in England

Registered office: Advantage House, Poplar Way, Catcliffe, Rotherham S60 5TR Registered number: 02649340

Notice of Annual General Meeting

Notice of the Annual General Meeting of Harworth Group plc to be held on Tuesday 25 May 2021 at 2:00 p.m. at Mercure Sheffield St. Paul's Hotel and Spa, City Suite, 119 Norfolk Street, Sheffield, S1 2JE.

Due to the continuing restrictions on public gatherings in England in response to the ongoing COVID-19 pandemic, shareholder attendance at the AGM is not currently possible. Shareholders are encouraged to appoint the Chair of the meeting to cast their votes for them by submitting a Form of Proxy in accordance with the instructions printed on the enclosed Form of Proxy. The Form of Proxy must be received before 2:00 p.m. on 21 May 2021.

However, should restrictions ease before the time of the AGM, there are contingency plans in place to facilitate shareholder attendance. Further information is available in the Letter from the Chair of the Board.

This document should be read as a whole. Nevertheless, your attention is drawn to the letter from the Chair of the Board which commences at page 4 of this document and the recommendation that you vote in favour of the resolutions to be proposed at the Annual General Meeting referred to below. This document should be read in conjunction with the Notice of Annual General Meeting set out at the end of this document and the accompanying Form of Proxy for use in connection with the meeting.

2 HARWORTH GROUP PLC

Contents

Page
Expected timetable of principal events 3
Letter from the Chair of the Board 4
Appendix 1: Directors' biographies 8
Definitions 10
Notice of Annual General Meeting 11

Expected timetable of principal events

Date of this document 22 April 2021
Record date for dividend 7 May 2021
Latest time and date for receipt of Forms of Proxy for the Annual General Meeting 2:00 p.m. on 21 May 2021
Annual General Meeting 2021 2:00 p.m. on 25 May 2021
Expected date for payment of dividend 28 May 2021

References to time in this document are to British Summer Time.

The timetable assumes that the Annual General Meeting is not adjourned as a result of there being no quorum, or for any other reason. If there is an adjournment, all subsequent dates and any other dates referred to in this document are likely to be later than those shown. If any of the above times and/or dates change, the revised times and/or dates will be notified to Shareholders by announcement on the Regulatory News Service.

Letter from the Chair of the Board

Harworth Group plc (Incorporated and registered in England with no. 02649340)

Registered office:

Advantage House Poplar Way Catcliffe Rotherham S60 5TR

22 April 2021

Dear Shareholder

Annual General Meeting 2021

The Annual General Meeting of the Company will be held on 25 May 2021 at 2:00 p.m. at Mercure Sheffield St. Paul's Hotel and Spa, City Suite, 119 Norfolk Street, Sheffield, S1 2JE.

COVID-19

Our preference had been to welcome shareholders in person to our 2021 AGM, particularly given the constraints we faced in 2020 due to the COVID-19 pandemic. However, at present, the rules in England continue to impose restrictions on public gatherings and advise against unnecessary travel. We are therefore proposing to hold the AGM with the minimum attendance required to form a quorum, which under our Articles of Association is two shareholders (or proxies). Whilst these restrictions continue, shareholders will not be able to attend the AGM in person but can be represented by the Chair of the meeting acting as their proxy (see further below on proxies).

Contingencies

Given the constantly evolving nature of the situation, should circumstances change before the time of the AGM such that we consider that it has become possible to accommodate shareholder attendance, we will adapt arrangements at the venue to welcome shareholders to the AGM in person, within safety constraints and in accordance with government guidelines in place at the time. In that event, we will notify shareholders of any change as early as is possible before the date of the meeting, as well as provide a map to help with the location of the venue. Please monitor our website at www.harworthgroup.com/investors and announcements via the Regulatory News Service.

Proxies and questions

Given the uncertainty around whether shareholders will be able to attend the AGM, we recommend that all shareholders use the proxy facility available to appoint the Chair of the meeting to cast your vote for you. This will ensure that your vote will be counted even if attendance at the meeting is restricted or you are unable to attend in person. Further instructions on how to appoint the Chair of the meeting as your proxy are provided in the notes to the Notice of Annual General Meeting. Should circumstances change and we become able to permit shareholder attendance, completion of the Form of Proxy will not preclude you from attending the AGM and voting in person. All resolutions will be voted on a poll which ensures shareholders' votes are counted according to the number of shares held.

Shareholders can also submit questions in advance of the AGM by emailing them to [email protected]. Responses will be provided in writing as soon as practicable and, where a series of questions follow a common theme, responses will be published on the website at www.harworthgroup.com/ investors.

Following the conclusion of the AGM the results will be announced via the Regulatory News Service and made available on the Company's website at www.harworthgroup.com.

Resolutions

As you can see from the Notice there are several items of business to be considered at the Annual General Meeting. The purpose of the remainder of this letter is to explain this business.

Resolutions 1 to 16 (inclusive) are proposed as ordinary resolutions. This means that, except for Resolution 12 which is an advisory vote only in accordance with the requirements of the Companies Act, for each of those resolutions to be passed, more than half of the votes cast must be in favour of the resolution.

Resolutions 17 to 19 (inclusive) are proposed as special resolutions. This means that for each of those resolutions to be passed, at least three quarters of the votes cast must be in favour of the resolution.

Ordinary Resolutions

1 – Adoption of Annual Report and Financial Statements

The Directors must present the report of the Directors and the financial statements of the Company for the year ended 31 December 2020 to Shareholders at the AGM. The report of the Directors, the financial statements, and the independent auditors' report are contained within the Annual Report.

2 – Approval of Dividend

Following the onset of COVID-19, the recommendation for the 0.7p per share final 2019 dividend was withdrawn in April 2020. In November 2020, the Board paid an interim dividend for the year ended 31 December 2020 at 0.334p per Ordinary Share. The Board is recommending a final dividend of 1.466p per Ordinary Share, which covers both the cancelled 2019 final dividend and a 2020 final dividend, to give a total dividend for the year ended 31 December 2020 of £5.8 million or 1.8p per Ordinary Share. It is proposed that the final dividend be paid on 28 May 2021 to those Shareholders on the register of members at the close of business on 7 May 2021.

3 – 5 Election of Directors

Resolutions 3, 4 and 5 propose the election of:

  • (1) Lisa Scenna, who joined the Company as an independent Non-Executive Director with effect from 1 September 2020;
  • (2) Lynda Shillaw, who joined the Company as Chief Executive with effect from 1 November 2020; and
  • (3) Patrick O'Donnell Bourke, who joined the Company as an independent Non-Executive Director with effect from 3 November 2020.

Their biographical details are contained in Appendix 1. The Board unanimously recommends their elections.

6 – 11 – Re-election of Directors

The Articles of Association provide that one third of the Directors should offer themselves for re-election each year. However, best practice recommends that all Directors should offer themselves for re-election each year and accordingly all six of the remaining Directors will offer themselves for re-election. Their biographical details are shown in Appendix 1. The six Directors seeking re-election are:

  • (1) Alastair Lyons Chair;
  • (2) Katerina Patmore Chief Financial Officer;
  • (3) Angela Bromfield Senior Independent Non-Executive Director;
  • (4) Ruth Cooke Independent Non-Executive Director;
  • (5) Steven Underwood Non-Executive Director; and
  • (6) Martyn Bowes Non-Executive Director representing the Pension Protection Fund. Each resolution for re-election will be taken as a separate vote.

The Nomination Committee has reviewed the effectiveness of those Directors who are offering themselves for re-election. Following that review, I confirm that the Board has determined that each of the Directors offering themselves for re-election is and continues to make a valuable and effective contribution to the Board, that each of them has demonstrated the appropriate level of commitment to his or her role, and that each of the Non-Executive Directors is and continues to be fully independent in both character and judgement, and there are no relationships or circumstances which are likely to affect their character or the exercise of their judgement.

12 – Approval of the Directors' Remuneration Report

The Directors' Remuneration Report gives details of the remuneration that was paid to the Directors for the year ended 31 December 2020 and will be paid to them for the year ending 31 December 2021, in accordance with the Company's current Remuneration Policy. The Remuneration Policy is due to be updated and presented for Shareholder approval at the 2022 annual general meeting.

The Company's auditors for the year ended 31 December 2020, Ernst & Young LLP, have audited those parts of the Directors' Remuneration Report capable of being audited. The vote is advisory in nature in that payments made or promised to Directors will not have to be repaid, reduced or withheld in the event that the Resolution is not passed.

13 and 14 – Re-appointment of Auditors and Auditors' Remuneration

The auditors of a Company must be re-appointed at each annual general meeting at which accounts are laid. Resolution 13 proposes the re-appointment of the Company's existing auditors, Ernst & Young LLP, until the conclusion of the annual general meeting of the Company to be held in 2022. Resolution 14 gives authority to the Directors to determine the auditors' remuneration.

15 – Authority to make political donations

Part 14 of the Companies Act restricts companies from making political donations to: (i) political parties; (ii) other political organisations; and (iii) independent election candidates and from incurring political expenditure without Shareholders' consent. The Company does not make and does not intend to make donations to political parties, political organisations or independent election candidates, nor does it incur any political expenditure. However, as the definitions used in the Companies Act are broad, it is possible that normal business activities such as sponsorship, subscriptions, payment of expenses, paid leave for employees fulfilling certain public duties, and support for bodies representing the business community in policy review or reform, which might not be thought to be political

6 HARWORTH GROUP PLC

expenditure in the usual sense, could be caught. Shareholder approval is being sought of this Resolution on a precautionary basis only to allow the Company and any company which, at any time during the period for which this Resolution has effect, is a subsidiary of the Company, to continue to support the community and put forward its views on or in relation to wider business and Government interests, without running the risk of being in breach of the Companies Act.

The Board is, therefore, seeking authority to make political donations to political parties and/or independent election candidates not exceeding £50,000 in total, to make political donations to political organisations other than political parties not exceeding £50,000 in total and to incur political expenditure not exceeding £50,000 in total. In line with the guidance issued by the Investment Association, it is proposed that this Resolution will be put to Shareholders annually. Therefore, the authority will be valid until the conclusion of the annual general meeting of the Company to be held in 2022 or, if earlier, 15 months from the date that this Resolution is passed.

16 – Allotment of Shares

The Directors may only allot shares or grant rights to subscribe for, or convert any security into, shares if authorised to do so by Shareholders. The authority conferred on the Directors at the 2020 annual general meeting under section 551 of the Companies Act to allot shares expires on the date of the forthcoming Annual General Meeting. Accordingly, this Resolution seeks to grant a new authority under section 551 of the Companies Act to authorise the Directors to allot shares in the Company or grant rights to subscribe for, or convert any security into, shares in the Company and will expire at the conclusion of the next annual general meeting of the Company to be held in 2022 or, if earlier, 15 months from the date that this Resolution is passed. Paragraph (A) of Resolution 16 will, if passed, authorise the Directors to allot shares or grant rights to subscribe for, or to convert any security into, such shares in the Company up to a maximum nominal amount of £10,645,776. This amount represents 33 per cent. of the Company's existing issued ordinary share capital as at 21 April 2021 (being the latest practicable date prior to publication of this Notice). Paragraph (B) of Resolution 16 authorises the Directors to allot, including the shares referred to in (A), further shares up to an aggregate nominal amount of £21,291,552 in connection with a pre-emptive offer to existing Shareholders by way of a rights issue (with exclusions to deal with fractional entitlements to shares and overseas Shareholders to whom the rights issue cannot be made due to legal and practical problems). This amount represents 66 per cent. of the Company's existing issued ordinary share capital as at 21 April 2021 (being the latest practicable date prior to publication of this Notice). This is in accordance with the latest institutional guidelines published by the Investment Association.

Although the Directors have no present intention of exercising this authority, there can be no certainty that this authority will not need to be utilised. The Directors consider that it is in the best interest of the Company to have the authorities available so that they have the maximum flexibility permitted by institutional guidelines to allot shares or grant rights without the need for a general meeting, should they determine that it is appropriate to do so. The Directors intend to renew this authority annually.

As at 21 April 2021 (being the latest practicable date prior to publication of this Notice), the Company held no shares in treasury.

Special Resolutions

17 – Disapplication of Pre-emption Rights

Under section 561(1) of the Companies Act, if the Directors wish to allot Ordinary Shares, or grant rights to subscribe for, or convert securities into Ordinary Shares, or sell treasury shares for cash (other than pursuant to an employee share scheme), they must in the first instance offer them to existing Shareholders in proportion to their holdings. There may be occasions, however, when the Directors need the flexibility to finance business opportunities through the issue of Ordinary Shares without a pre-emptive offer to existing Shareholders. This cannot be done under the Companies Act unless Shareholders have first waived their pre-emption rights.

Resolution 17 asks the Shareholders to do this and, apart from rights issues or any other pre-emptive offer concerning equity securities, the authority contained in this Resolution will be limited to the issue of Ordinary Shares for cash up to an aggregate nominal value of £1,612,996 (which includes the sale on a non pre-emptive basis of any shares held in treasury), which represents approximately 5 per cent. of the Company's issued ordinary share capital as at 21 April 2021 (being the latest practicable date prior to the publication of this Notice). Resolution 17 also seeks a disapplication of the pre-emption rights on a rights issue so as to allow the Directors to make exclusions or such other arrangements as may be appropriate to resolve legal or practical problems which, for example, might arise with overseas Shareholders.

In accordance with the Pre-emption Group's Statement of Principles, the Board confirms its intention that no more than 7.5 per cent. of the issued share capital will be issued for cash on a non pre-emptive basis during any future rolling three-year period without prior consultation with Shareholders. Shareholders should note that this Resolution also relates to treasury shares and will be proposed as a special resolution.

If given, the authority will expire at the conclusion of the next annual general meeting of the Company in 2022 or, if earlier 15 months from the date that the Resolution is passed.

Although the Directors have no present intention of exercising this authority, there can be no certainty that this authority will not need to be utilised. The Directors intend to renew this authority annually.

18 – Authority to Purchase Own Shares

This Resolution, which will be proposed as a special resolution, renews the authority granted at the 2020 annual general meeting which expires on the date of the forthcoming Annual General Meeting. The Resolution authorises the Company to make market purchases of its own Ordinary Shares as permitted by the Companies Act. The authority limits the number of shares that could be purchased to a maximum of 32,259,928 Ordinary Shares (representing less than 10 per cent. of the issued share capital of the Company as at 21 April 2021 (being the last practicable date prior to the publication of this Notice) and sets minimum and maximum prices.

The Directors have no present intention of exercising the authority to purchase the Company's Ordinary Shares but will keep the matter under review, taking into account market conditions, the cash reserves of the Company, the Company's share price, appropriate

gearing levels, other investment opportunities and the overall financial position of the Company. The authority will be exercised only if the Directors believe that to do so would result in an increase in earnings per share and would be likely to promote the success of the Company for the benefit of its Shareholders as a whole.

Any purchases of Ordinary Shares would be by means of market purchases through the London Stock Exchange. Any Ordinary Shares purchased under this authority may either be cancelled or held as treasury shares. Treasury shares may subsequently be cancelled, sold for cash or used to satisfy options issued to employees pursuant to employees' share schemes.

The authority will only be valid until the conclusion of the next annual general meeting in 2022 or, if earlier, 15 months from the date that this Resolution is passed.

As at 21 April 2021 (being the last practicable date prior to the publication of this Notice) the Company had the following awards outstanding under its share schemes:

  • aggregate awards of up to 1,426,433 Ordinary Shares under the Harworth 2019 Restricted Share Plan; and
  • aggregate awards of 823,221 Ordinary Shares under the Harworth Group plc Save As You Earn Scheme.

These awards represent in aggregate 0.7 per cent. of the Company's issued ordinary share capital as at that date. If the authority to purchase the Company's Ordinary Shares granted at the 2020 annual general meeting and the authority proposed to be granted pursuant to Resolution 18 were exercised in full, these awards would, assuming no further Ordinary Shares are issued after that date, represent 0.87 per cent. of the Company's issued ordinary share capital as at that date. This percentage would reduce to 0.77 per cent. if no further purchases were made under the authority granted at the 2020 annual general meeting, but the authority exercised pursuant to Resolution 18 was exercised in full. As at the close of business on 21 April 2021 (being the last practicable date prior to the publication of this Notice), the Company did not hold any shares in treasury and no warrants over the Ordinary Shares in the capital of the Company existed.

19 – General Meetings at Short Notice

The Articles of Association of the Company allow it to call general meetings other than an annual general meeting on 14 clear days' notice without obtaining Shareholder approval. Changes made to the Companies Act by the Shareholders' Rights Regulations increase the notice period required for general meetings of the Company to 21 days unless Shareholders approve a shorter notice period, which cannot however be less than 14 clear days. In order to preserve its ability to call general meetings on 14 clear days' notice, Resolution 19 seeks such Shareholder approval. It is intended that the shorter notice period would not be used as a matter of routine but only where the flexibility is merited by the business of the meeting and is thought to be in the interests of Shareholders as a whole. The Company undertakes to meet the requirements for electronic voting under the Shareholders' Rights Regulations before calling a general meeting on 14 clear days' notice. If given, the approval will be effective until the Company's next annual general meeting, when it is intended that a similar resolution will be proposed.

The Company intends to continue giving 20 working days' notice for annual general meetings in accordance with the Financial Reporting Council's Guidance on Board Effectiveness.

Notice of publication of Annual Report and Financial Statements

Notice is hereby given that the Harworth Group plc Annual Report and Financial Statements for the year ended 31 December 2020 has been published on the Company's website www.harworthgroup.com. It can be accessed by going to the Company's home page, clicking on the Investors section of the website and then going to Reports and Presentations. If you have elected to receive Shareholder correspondence in hard copy, the Annual Report will accompany this Notice.

Should you wish to change your election at any time, or if you wish to request a hard copy of the Annual Report, you can do so by contacting our Registrars, Equiniti Limited, on 0371 384 2301. Lines are open 8:30 a.m. to 5:30 p.m., Monday to Friday (excluding public holidays in England and Wales). Callers from outside the UK should dial +44 (0)121 415 7047.

Recommendation

All Directors seeking re-election are of the opinion that all the proposals to be considered at the Annual General Meeting are in the best interests of the Company and its Shareholders as a whole and recommend that you vote in favour of the Resolutions to be proposed at the AGM, as they intend to do in respect of their own beneficial shareholdings.

Action to be taken

Hard copies of a Form of Proxy for the AGM for use by the Company have been sent to all Shareholders. If you do not intend to be present at the Annual General Meeting, please complete, sign and return the Form of Proxy as soon as possible (and, in any event, so as to be received not later than 2:00 p.m. on 21 May 2021), in accordance with the instructions printed on it. You are encouraged to appoint the Chair of the meeting to cast your vote for you.

Yours sincerely

Alastair Lyons Chair of the Board

Appendix 1: Directors' biographies

New Appointments

1. Lisa Scenna (Non-Executive Director)

Lisa joined the Board on 1 September 2020 and is a member of the Remuneration and Audit Committees.

Lisa has over 20 years' experience working at executive director level in large multinational corporations both private and publicly listed with a strong background in real estate development and asset management. Her most recent executive role was with Morgan Sindall Group as Managing Director of MS Investments. Prior to this, she held executive roles with Laing O'Rourke, having led their infrastructure investment activities globally, and Stockland Group and Westfield Group in Australia. Lisa has also been a director of various public private partnerships, most recently as the Deputy Chair of the Private Infrastructure Development Group. She is a member of the Australian Institute of Company Directors and the Institute of Chartered Accountants in Australia.

Lisa is a Non-Executive Director of Polypipe Group plc and of Cromwell Property Group, an Australian listed company.

2. Lynda Shillaw (Chief Executive)

Lynda was appointed Chief Executive on 1 November 2020 and is also a member of the Nomination Committee.

Prior to this appointment, Lynda was Group Property Director at Town Centre Securities plc where she led the management of its land and property and its development pipeline. Before that she was Divisional CEO, Property at the Manchester Airports Group (MAG), where she was responsible for MAG's investment portfolio and development land bank, including its "Airport City" joint venture. This followed a long career managing both investment and development real estate portfolios for BT and Co-operative Group before joining Lloyds Banking Group as Global Head of its Real Estate lending division.

Lynda is a Non-Executive Director of The Crown Estate and Vivid Housing Association.

3. Patrick O'Donnell Bourke (Non-Executive Director)

Patrick joined the Board on 3 November 2020 and is Chair of the Audit Committee.

Patrick has significant senior international experience in investing in, and managing, infrastructure and utilities. He was Chair of the Audit and Risk Committee and a member of the Nomination and Remuneration Committees of Calisen plc until March 2021. He was also Non-Executive Director of Affinity Water Limited from 2013 to 2020. His most recent executive role was that of Group Finance Director for John Laing Group plc from 2011 to 2019. Prior to that he was Group Finance Director of Viridian Group plc, the Northern Ireland based energy group from 2000 to 2006, before becoming Group Chief Executive from 2007 to 2011 after Viridian was taken private. Previously he was Group Treasurer for Powergen plc and spent nine years in investment banking with Barclays de Zoete Wedd and Hill Samuel, having qualified as a chartered accountant with Peat Marwick (now KPMG).

Patrick is Chair of Ecofin US Renewables Infrastructure Trust plc.

Directors offering themselves for re-election

1. Alastair Lyons (Non-Executive Chair)

Alastair was appointed as Non-Executive Chair on 7 March 2018 and has served for 3 years 2 months. He also chairs the Nomination Committee and is a member of the Remuneration Committee.

Alastair was Non-Executive Chair of the Admiral Group from 2000 to 2017, Deputy Chair of Bovis Homes from 2008 to 2018, Chair of Serco from 2010 to 2015 and of Towergate Insurance from 2011 to 2015. Previously in his executive career, Alastair was Chief Executive of the National Provident Institution and the National and Provincial Building Society, Managing Director of the Insurance Division of Abbey National plc and Director of Corporate Projects at National Westminster Bank plc. He has a broad base of business experience with a particular focus on the housing and insurance industries. He was awarded the CBE in 2001 for services to social security having served as a Non-Executive director of the Department for Work and Pensions and the Department of Social Security.

Alastair is Non-Executive Chair of Welsh Water, Vitality UK, AECS: Admiral's European holding company, and Eaton House schools.

2. Katerina (Kitty) Patmore (Chief Financial Officer)

Kitty was appointed Chief Financial Officer on 1 October 2019 and has served for 1 year 7 months. Prior to this appointment, Kitty was Director with responsibility for Finance and Operations at Harwood Real Estate, which managed one of the largest private rented housing investment portfolios in the United Kingdom. She led the finance function with responsibility for investor relations and capital markets, including leading an LSE main market fundraising process. Kitty started her career in banking at Barclays specialising in structured real estate finance, before moving into real estate mezzanine finance across the UK and Europe for a private debt fund, DRC Capital.

Kitty was recently appointed as a Non-Executive Director of LondonMetric Property plc where she is a member of the Audit Committee. Kitty is also Chair of the Investment Property Forum Finance Group.

3. Angela Bromfield (Senior Independent Director)

Angela joined the Board on 1 April 2019 and has served for 2 years 1 month. She is also Senior Independent Director, Chair of the Remuneration Committee and a member of the Nomination Committee.

Angela has extensive commercial strategy, marketing and communications executive experience. She was Strategic Marketing & Communications Director at Morgan Sindall plc until 2013 and prior to that held senior roles at the Tarmac Group, Premier Farnell plc and ICI plc.

Angela is a Non-Executive Director at Marshalls plc and Churchill China plc.

4. Ruth Cooke (Non-Executive Director)

Ruth joined the Board on 19 March 2019 and has served for 2 years 2 months. She is also a member of the Audit Committee.

Ruth was Finance Director (from 2008 to 2012) and then Chief Executive (from 2012 to 2018) of Midland Heart, a Birmingham based housing association. Prior to that, she held senior finance and resourcing roles at Knightstone, a housing association based in the South West, and Anchor Trust, a provider of housing and care to those aged 55 years old and above. Ruth has held a number of voluntary and non-executive positions in the social housing and retirement community sector. She is an Associate of the Institute of Chartered Accountants and a corporate treasurer.

Ruth is Chief Executive of GreenSquareAccord, a housing association operating across the North, Midlands and South West.

5. Steven Underwood (Non-Executive Director)

Steven joined the Board on 2 August 2010 and has served for 10 years 9 months.

Steven was formerly a representative Director of Peel Group. Following the reduction of Peel Group's shareholding, Steven now sits on the Board in a personal, rather than representative, capacity. However, given his previous representative capacity, and his length of service, Steven cannot be regarded as independent for the purposes of the UK Corporate Governance Code.

Steven is Chief Executive of the Peel Group of companies and brings to the Board the extensive experience of the Peel Group in brownfield land remediation and regeneration.

6. Martyn Bowes (Non-Executive Director)

Martyn joined the Board on 24 March 2015 as a representative of the Pension Protection Fund, currently the Company's second largest shareholder, having previously been a Non-Executive Director of HEPGL from 19 March 2013. Martyn has served for 6 years 2 months (8 years 2 months including his appointment to HEPGL).

Martyn has spent the majority of his career in banking, most recently from 2001 to 2007 with Barclays Capital as Managing Director, Real Estate Finance. Since leaving Barclays he has pursued a portfolio business career, which in 2012 involved a takeover with fellow Directors of the South of England based Welbeck Land real estate business. Martyn now acts as Finance Director for Welbeck Land and also maintains other interests in debt advisory and healthcare.

Martyn is a director of multiple private limited companies predominantly within the Welbeck Land Group.

10 HARWORTH GROUP PLC

Definitions

The following definitions apply throughout this document, unless the context requires otherwise:

Companies Act the Companies Act 2006, as amended
Board of Directors the Board of Directors of the Company
Annual General Meeting or AGM the Annual General Meeting of Harworth Group plc convened for 2:00 p.m. on 25 May 2021
(or any adjournment of it), NAotice of which is set out at the end of this document
Annual Report the Annual Report and Financial Statements of the Company for the year ended 31 December
2020 made available to Shareholders on 22 April 2021
Articles or Articles of Association the current articles of association of the Company (as adopted at the 2018 annual general
meeting)
CREST the UK based electronic system for paperless settlement of trades in listed securities, of which
Euroclear UK is the operator
Form of Proxy the Form of Proxy relating to the Annual General Meeting being sent to Shareholders with this
document
Harworth or Company Harworth Group plc, a company incorporated in England and Wales with registered number
02649340
Harworth Group or Group the Company, its subsidiaries and subsidiary undertakings at the date of this document
HEPGL Harworth Estates Property Group Limited, a company incorporated in England and Wales with
registered number 08232459
Notice the Notice of Annual General Meeting as set out at the end of this document
Official List the official list of the Financial Conduct Authority
Ordinary Shares ordinary shares of 10 pence each in the capital of the Company
Peel Group Peel Holdings Limited (company no. 2567V) of Billown Mansion House, Ballasalia, Malew, Isle
of Man, IM9 3DL and its subsidiaries from time to time
Registrars Equiniti Limited of Aspect House, Spencer Road, Lancing, West Sussex, BN99 8JB
Resolutions the ordinary and special resolutions to be proposed at the Annual General Meeting, as set out
in the Notice of Annual General Meeting
Shareholders' Rights Regulations the Companies (Shareholders' Rights) Regulations 2009
Shareholders holders of Ordinary Shares, each individually being a "Shareholder"
Statement of Principles the Statement of Principles on Disapplying Pre-Emption rights most recently published by
the Pre-Emption Group prior to the date of this Notice

Notice of Annual General Meeting

Notice is hereby given that the Annual General Meeting of Harworth Group plc (the "Company") will be held at Mercure Sheffield St. Paul's Hotel and Spa, City Suite, 119 Norfolk Street, Sheffield, S1 2JE on 25 May 2021 at 2:00 p.m. for the following purposes:

Ordinary business

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

    1. To receive the Company's annual accounts together with the Directors' report and the auditors' report on those accounts for the year ended 31 December 2020.
    1. To declare a final dividend for the year ended 31 December 2020 of 1.466 pence per Ordinary Share, payable on 28 May 2021 to those shareholders on the register of members at the close of business on 7 May 2021.
    1. To elect Lisa Scenna as a Non-Executive Director appointed since the last annual general meeting of the Company.
    1. To elect Lynda Shillaw as Chief Executive appointed since the last annual general meeting of the Company.
    1. To elect Patrick O'Donnell Bourke as a Non-Executive Director appointed since the last annual general meeting of the Company.
    1. To re-elect Alastair Lyons as a Director of the Company.
    1. To re-elect Katerina Patmore as a Director of the Company.
    1. To re-elect Angela Bromfield as a Director of the Company.
    1. To re-elect Ruth Cooke as a Director of the Company.
    1. To re-elect Steven Underwood as a Director of the Company.
    1. To re-elect Martyn Bowes as a Director of the Company.
    1. To approve the Directors' Remuneration Report for the year ended 31 December 2020. This is an advisory vote in accordance with the Companies Act.
    1. To resolve that Ernst & Young LLP be reappointed as the auditors of the Company to hold office until the conclusion of the next annual general meeting.
    1. To authorise the Directors to agree the remuneration of the Company's auditors.

Special business

To consider and, if thought fit, pass the following resolutions of which resolutions numbered 15 and 16 will be proposed as ordinary resolutions and resolutions numbered 17 to 19 (inclusive) will be proposed as special resolutions:

Political donations

    1. That, in accordance with section 366 of the Companies Act, the Company and all companies that are its subsidiaries at any time during the period for which this resolution is effective are authorised, in aggregate, to:
  • a. make political donations to political parties and/or independent election candidates not exceeding £50,000 in total;
  • b. make political donations to political organisations other than political parties not exceeding £50,000 in total; and
  • c. incur political expenditure not exceeding £50,000 in total,

(as such terms are defined in sections 363 to 365 of the Companies Act) during the period commencing on the date of the passing of this resolution and finishing at the end 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 date of this resolution), provided that the aggregate amount of any such political donations made and political expenditure incurred by the Company and its subsidiaries pursuant to this authority shall not exceed £50,000.

Authority to allot shares

    1. a. That the Directors be generally and unconditionally authorised pursuant to section 551 of the Companies Act to:
  • i. allot shares in the Company, and to grant rights to subscribe for, or to convert any security into, shares in the Company:
    • (A) up to an aggregate nominal amount of £10,645,776; and
    • (B) comprising equity securities (as defined in the Companies Act) up to an aggregate nominal amount of £21,291,552 (including within such limit any shares issued or rights granted under paragraph (A) above) in connection with an offer by way of a rights issue:
    • I. to holders of Ordinary Shares in proportion (as nearly as may be practicable) to their existing holdings; and
    • II. to people who are holders of other equity securities if this is required by the rights of those securities or, if the Directors consider it necessary, as permitted by the rights of those securities;

and so that the Directors 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 any other matter;

for a period expiring (unless previously renewed, varied or revoked by the Company in general meeting) at the end 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 date of this resolution); and

  • ii. make an offer or agreement which would or might require shares to be allotted, or rights to subscribe for or convert any security into shares to be granted, after expiry of this authority and the Directors may allot shares and grant rights in pursuance of that offer or agreement as if this authority had not expired.
  • b. That, subject to paragraph (c) all existing authorities given to the Directors pursuant to section 551 of the Companies Act be revoked by this resolution.
  • c. That paragraph (b) shall be without prejudice to the continuing authority of the Directors to allot shares, or grant rights to subscribe for or convert any security into shares, pursuant to an offer or agreement made by the Company before the expiry of the authority pursuant to which such offer or agreement was made.

Disapplication of Pre-emption Rights

    1. That, if Resolution 16 is passed, the Board be authorised to allot equity securities (as defined in the Companies Act) for cash under the authority given by that resolution and/or to sell Ordinary Shares held by the Company as treasury shares for cash as if section 561 of the Companies Act did not apply to any such allotment or sale, such authority to be limited:
  • a. to allotments for rights issues and other pre-emptive issues; and
  • b. to the allotment of equity securities or sale of treasury shares (otherwise than under paragraph a. above) up to a nominal amount of £1,612,996,

such authority to expire at the end 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 date of this resolution) but, in each case, prior to its expiry the Company may make offers, and enter into agreements, which would, or might, require equity securities to be allotted (and treasury shares to be sold) after the authority expires and the Board may allot equity securities (and sell treasury shares) under any such offer or agreement as if the authority had not expired.

Authority to purchase own shares

    1. That, pursuant to section 701 of the Companies Act, the Company be and is hereby generally and unconditionally authorised to make market purchases (within the meaning of section 693(4) of the Companies Act) of its Ordinary Shares of 10 pence each in the capital of the Company, subject to the following conditions:
  • a. the maximum number of Ordinary Shares authorised to be purchased is 32,259,928;
  • b. the minimum price (exclusive of expenses) which may be paid for an Ordinary Share is 10 pence;
  • c. the maximum price (exclusive of expenses) which may be paid for each Ordinary Share is the higher of: (i) an amount equal to 105 per cent. of the average of the middle market quotations of an Ordinary Share of the Company as derived from the London Stock Exchange Daily Official List for the 5 business days immediately preceding the day on which the Ordinary Share is contracted to be purchased; and (ii) an amount equal to the higher of the price of the last independent trade of an Ordinary Share and the highest current independent bid for an Ordinary Share as derived from the London Stock Exchange Trading System;
  • d. this authority shall expire at the close of the next annual general meeting of the Company (or, if earlier, at the close of business on the date which is 15 months from the date of this resolution); and
  • e. a contract to purchase shares under this authority may be made before the expiry of this authority, and concluded in whole or in part after the expiry of this authority.

Notice of general meetings

  1. That, subject to the Articles of Association of the Company as in force from time to time, a general meeting other than an annual general meeting may be called on not less than 14 clear days' notice.

By order of the Board

Registered in England with No. 02649340

Registered Office Advantage House Chris Birch Poplar Way Secretary Catcliffe Rotherham S60 5TR

Notes

COVID-19

  1. Due to the continuing restrictions on public gatherings in England in response to the ongoing COVID-19 pandemic, any shareholder or proxy (other than the Chair) will be excluded from the meeting on the grounds of public safety. All other notes below are subject to and should be read in conjunction with this note 1.

Entitlement to attend and vote

  1. The right to attend and vote at the meeting is determined by reference to the Company's register of members. Only a member entered in the register of members at 6:30 p.m. on 21 May 2021 (or, if this meeting is adjourned, in the register of members at 6:30 p.m. on the day two days prior to the adjourned meeting, excluding weekends and bank holidays) is entitled to attend and vote at the meeting and a member may vote in respect of the number of Ordinary Shares registered in the member's name at that time. Changes to the entries in the register of members after that time shall be disregarded in determining the rights of any person to attend and vote at the meeting.

Proxies

    1. A shareholder of the Company may appoint one or more proxies (who need not be a member of the Company) to exercise all or any of his or her rights to attend and to speak and vote at a meeting of the Company provided that each proxy is appointed to exercise the rights attached to a different share or shares held by him or her. A shareholder may only appoint a proxy or proxies by:
  • completing and returning the proxy form enclosed in this pack (Form of Proxy); or
  • if you are a user of the CREST system (including CREST Personal Members), having an appropriate CREST message transmitted.

The Registrars can be contacted on the helpline on 0371 384 2301. Lines are open 8:30 a.m. to 5:30 p.m., Monday to Friday (excluding public holidays in England and Wales). Callers from outside the UK should dial +44 (0)121 415 7047.

IMPORTANT: In any event your Form of Proxy must be received by the Company's Registrars no later than 2:00 p.m. on 21 May 2021.

To appoint a proxy or to give or amend an instruction to a previously appointed proxy via the CREST system, the CREST message must be received by the issuer's agent (ID number: RA 19) by 2:00 p.m. on 21 May 2021. For this purpose, the time of receipt will be taken to be the time (as determined by the time stamp applied to the message by the CREST Applications Host) from which the issuer's agent is able to retrieve the message. After this time any change of instructions to a proxy appointed through CREST should be communicated to the proxy by other means. CREST Personal Members or other CREST sponsored members, and those CREST Members who have appointed voting service provider(s) should contact their CREST sponsor or voting service provider(s) for assistance with appointing proxies via CREST. For further information on CREST procedures, limitations and system timings, please refer to the CREST Manual which can be viewed at www.euroclear.com/ CREST. We may treat a proxy appointment sent by CREST as invalid in the circumstances set out in Regulation 35(5Ka) of the Uncertificated Securities Regulations 2001.

Further details of the appointment of proxies are given in the notes to the Form of Proxy enclosed with this pack.

In the current circumstances you are encouraged to appoint the Chair of the AGM as your proxy. In accordance with the current rules in place in England to deal with COVID-19, any proxy other than the Chair of the AGM will be refused entry to the meeting.

Corporate representative

  1. Any corporation which is a shareholder can ordinarily appoint one or more corporate representatives who may exercise on its behalf all of its powers as a member provided that where more than one corporate representative has been appointed they do not exercise their powers differently in relation to the same shares.

Nominated persons

    1. Any person to whom this Notice is sent who is a person nominated under section 146 of the Companies Act to enjoy information rights (a "Nominated Person") may have a right under an agreement between him and the shareholder by whom he was nominated, 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 or she may, under any such agreement, have a right to give instructions to the shareholder as to the exercise of voting rights.
    1. The statement of the rights of shareholders in relation to the appointment of proxies as stated above does not apply to Nominated Persons. The rights described in that paragraph can only be exercised by shareholders of the Company.

Issued Share Capital and Total Voting Rights

  1. As at 21 April 2021 (being the last practicable date prior to the publication of this Notice) the Company's issued share capital consisted of 322,599,284 Ordinary Shares, carrying one vote each. The Company does not hold any shares in treasury. Therefore, the total voting rights in the Company as at 21 April 2021 are 322,599,284.

Members' requests under Section 527 of the Companies Act

  1. Under section 527 of the Companies Act members meeting the threshold requirements set out in that section have the right to require the Company to publish a statement on a website 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 last annual general meeting. 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. Where the Company is required to place a statement on a website under section 527 of the Companies Act, it must forward the statement to the Company's auditors 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 to publish on a website.

Members' rights to ask questions

  1. Shareholders can also submit questions in advance of the AGM by emailing them to [email protected]. Responses will be provided in writing as soon as practicable and, where a series of questions follow a common theme, responses will be published on the website at www.harworthgroup.com/investors.

Inspection of documents

    1. The following documents will be available for inspection at the Company's registered office and at DLA Piper UK LLP, 160 Aldersgate Street, London, EC1A 4HT from the date of this Notice and at the place of the Annual General Meeting from 15 minutes before the Annual General Meeting until it ends:
  • Copies of the Executive Directors' service contracts.
  • Copies of the letters of appointment of the Non-Executive Directors.

Website

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

Voting results

  1. The results of the voting at the Annual General Meeting will be announced through a Regulatory Information Service and will appear on the Company website, www.harworthgroup.com on 25 May 2021.

Communications with the Company

You may not use any electronic address provided either in this Notice or any related document (including the Form of Proxy) to communicate with the Company for any purposes other than those expressly stated.

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