ZOTEFOAMS PLC — AGM Information 2021

Apr 26, 2021

Notice of the 2021 Annual General Meeting

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. bank manager, solicitor, accountant or other independent adviser authorised under the Financial Services and Markets Act 2000 if you are resident in the UK or, if you reside elsewhere, another appropriately authorised financial adviser.

If you have sold or otherwise transferred your shares in Zotefoams plc. you should forward this document and other documents enclosed as soon as possible either to the purchaser or transferee or to the person who arranged the sale or transfer so they can pass these documents to the person who now holds the shares.

ZOTEFOAMS PLC Notice of Annual General Meeting

COVID-19

Zotefoams plc considers it vital to engage with investors and other stakeholders through the most appropriate channels. Shareholders' views are important and we want to ensure that they are given as much information as possible in good time to enable them to participate in the decision-making process.

In light of the COVID-19 pandemic and the UK Government's current guidance regarding social distancing and the prohibition of public gatherings, the arrangements and format of the Annual General Meeting (AGM) have been altered this year in order to protect the health and wellbeing of shareholders and other attendees Accordingly, the Company will make arrangements such that the legal requirements to hold the AGM can be satisfied through the attendance of a minimum number of people.

While it is with regret that shareholders are requested not to attend the AGM, a separate presentation open to all existing and potential shareholders will be held after the AGM on 26 May 2021 at 11.00am on the Investor Meet Company platform: https://www. investormeetcompany.com/zotefoams-plc/register-investor

Investors who already follow Zotefoams plc on the Investor Meet Company platform will automatically be invited.

In addition, new articles provisions are being proposed to allow hybrid AGMs to be held in the future.

Shareholders are strongly encouraged to submit a proxy form indicating their votes in accordance with the notes below and email any question for the Board to investorinfo@zotefoams.com a minimum of 48 hours prior to the AGM. The Board will do its best to answer these questions either during, or immediately after, the AGM, by email.

The Board is monitoring the situation and will make any further announcement required through the release of an RNS and on the AGM page of its website: https://www.zotefoams.com/agm/.

Notice is hereby given that the Annual General Meeting (the AGM) of Zotefoams plc (the "Company") will be held at the registered office of the Company, 675 Mitcham Road, Croydon, CR9 3AL on 26 May 2021 at 10.00 am for the following purposes. In light of social distancing restrictions, no access will be granted to the premises to shareholders or proxy holders.

All resolutions will be proposed as ordinary resolutions, save for resolutions 14, 15, 16, 17 and 18, which will be proposed as special resolutions.

Ordinary business

• To receive the Annual Report of the Company for the year ended 1. 31 December 2020

• To approve the Annual Statement by the Chair of the Remuneration $\mathcal{P}$ Committee and the Annual Report on Remuneration for the year ended 31 December 2020 set out on pages 70 to 80 of the Annual Report.

• 1. To declare a final dividend for the year ended 31 December 2020 of 4.27 pence per ordinary share, such dividend to be payable on 1 June 2021 to shareholders on the register of members of the Company at the close of business on 7 May 2021.
• 1. To re-elect S P Good as a Director.
• To re-elect D B Stirling as a Director. 5.
• To re-elect G C McGrath as a Director. 6.
• To re-elect J D Carling as a Director. $7.$
• To re-elect A M Fielding as a Director. 8.
• To re-elect D G Robertson as a Director. 9.
• 1. To re-elect C A Wall as a Director.
• 1. That PKF Littlejohn LLP be and is hereby re-appointed as Auditor of the Company to hold office from the conclusion of the AGM until the conclusion of the next general meeting at which accounts are laid before the Company.
• 1. To authorise the Audit Committee to determine the Auditor's remuneration.

Special business

To consider and, if thought fit, to pass the following resolutions of which resolution 13 will be proposed as an ordinary resolution and resolutions 14, 15, 16, 17 and 18 will be proposed as special resolutions:

• 1. That, in substitution for any equivalent authorities and powers granted to the Directors prior to the passing of this resolution, the Directors be and are generally and unconditionally authorised pursuant to Section 551 of the Companies Act 2006 (the "Act"):
• (a) to exercise all powers of the Company to allot shares in the Company and grant rights to subscribe for or to convert any security into shares of the Company (such shares, and rights to subscribe for or to convert any security into shares of the Company. being "relevant securities") up to an aggregate nominal amount of £810,353 (such amount to be reduced by the nominal amount of any allotments or grants made under paragraph (b) below in excess of £810,353), and further
• (b) to allot equity securities (as defined in Section 560 of the Act) up to an aggregate nominal amount of £1,620,706 (such amount to be reduced by the nominal amount of any allotments or grants made under paragraph (a) above) in connection with an offer by way of rights issue:
  • (i) in favour of holders of ordinary shares in the capital of the Company, where the equity securities respectively attributable to the interests of all such holders are proportionate (as nearly as practicable) to the respective number of ordinary shares in the capital of the Company held by them, and
  • (ii) to holders of any other equity securities as required by the rights of those securities or as the Directors otherwise consider necessary,

but subject to such exclusions or other arrangements as the Directors may deem necessary or expedient to deal with treasury shares, fractional entitlements or legal, regulatory or practical problems arising under the laws or requirements of any overseas territory or by virtue of shares being represented by depository receipts or the requirements of any regulatory body or stock exchange or any other matter whatsoever,

provided that, unless previously revoked, varied or extended, this authority shall expire on the earlier of 30 June 2022 and the conclusion of the next AGM of the Company, except that the Company may at any time before such expiry make an offer or agreement which would or might require relevant securities to be allotted after such expiry and the Directors may allot relevant securities in pursuance of such an offer or agreement as if this authority had not expired.

• 1. That if resolution 13 is passed, the Directors be authorised to allot equity securities (as defined in Section 560 of the 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 Act did not apply to any such allotment or sale, such authority to be limited:
• (a) in favour of holders of ordinary shares in the capital of the Company, where the equity securities respectively attributable to the interests of all such holders are proportionate (as nearly as practicable) to the respective number of ordinary shares in the capital of the Company held by them 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 £121.553.

such authority to expire at the conclusion of the next AGM of the Company (or, if earlier, on 30 June 2022) 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 Directors may allot equity securities (and sell treasury shares) under any such offer or agreement as if the authority had not expired.

• 1. That if resolution 13 is passed, the Directors be authorised in addition to any authority granted under resolution 14 to allot equity securities (as defined in Section 560 of the 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 Act did not apply to any such allotment or sale, such authority to be:
• (a) limited to the allotment of equity securities or sale of treasurv shares up to a nominal amount of £121,553 and
• (b) used only for the purposes of financing (or refinancing, if the authority is to be used within six months after the original transaction) a transaction which the Directors determine to be an acquisition or other capital investment of a kind contemplated by the Statement of Principles on Disapplying Pre-Emption Rights most recently published by the Pre-Emption Group prior to the date of this notice.

such authority to expire at the conclusion of the next AGM of the Company (or, if earlier, on 30 June 2022) 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 Directors may allot equity securities (and sell treasury shares) under any such offer or agreement as if the authority had not expired.

• 1. That the Company be and is hereby unconditionally and generally authorised for the purposes of Section 701 of the Act to make market purchases (within the meaning of Section 693(4) of the Act) of its ordinary shares of 5 pence each ("ordinary shares") provided that:
• (a) the maximum number of ordinary shares authorised to be purchased is 4,862,123, representing approximately 10% of the issued ordinary share capital as at 6 April 2021,
• (b) the minimum price which may be paid for any such ordinary share is 5 pence.
• (c) the maximum price which may be paid for an ordinary share shall be an amount equal to 105% of the average middle market quotations for an ordinary share as derived from the London Stock Exchange Daily Official List for the five business days immediately preceding the day on which the ordinary share is contracted to be purchased and

• (d) this authority shall, unless previously renewed, revoked or varied, expire on the earlier of 30 June 2022 and the conclusion of the next AGM, but the Company may enter into a contract for the purchase of ordinary shares before the expiry of this authority which would or might be completed (wholly or partly) after its expiry.

• 1. That a general meeting other than an AGM may be called on not less than 14 clear days' notice.
• 1. That, with effect from the conclusion of the AGM and pursuant to Section 21(1) of the Companies Act 2006, the Articles of Association produced to the meeting, and for the purpose of identification signed by the Chair, be approved and adopted as the Articles of Association of the Company in substitution for, and to the exclusion of, the existing Articles of Association of the Company.

Dated: 7 April 2021 By order of the Board

Registered Office:

675 Mitcham Road Crovdon CR93AL

L Harratt

Company Secretary

The following notes are subject to social distancing measures prohibiting attendance of the AGM by a Member or Proxy:

• Pursuant to Part 13 of the Companies Act 2006 and to Regulation 41 of the Uncertificated Securities Regulations 2001 (as amended). only those members registered in the register of members of the Company at the close of business on 24 May 2021 (or if the AGM is adjourned, 48 hours before the time fixed for the adjourned AGM) shall be entitled to attend and vote at the AGM in respect of the number of shares registered in their name at that time. In each case, changes to the register of members after such time shall be disregarded in determining the rights of any person to attend or vote at the AGM.
• If you wish to attend the AGM in person, please bring some form of $(ii)$ identification (such as driver's licence or bankcard) and present this to the Company's reception desk on arrival.
• A member who is entitled to attend, speak and vote at the AGM $(iii)$ may appoint a proxy to attend, speak and vote instead of him or her. A member may appoint more than one proxy, provided each proxy is appointed to exercise rights attached to different shares (so a member must have more than one share to be able to appoint more than one proxy). A proxy need not be a member of the Company but must attend the AGM in order to represent you. A proxy must vote in accordance with any instructions given by the member by whom the proxy is appointed. Appointing a proxy will not prevent a member from attending in person and voting at the AGM (although voting in person at the AGM will terminate the proxy appointment). A proxy form is enclosed or has been sent to you separately. The notes to the proxy form include instructions on how to appoint the Chair of the AGM or another person as a proxy. You can only appoint a proxy using the procedures set out in these notes and in the notes to the proxy form.
• (iv) To be valid, a proxy form, and the original or duly certified copy of the power of attorney or other authority (if any) under which it is signed or authenticated, should reach the Company's registrars, Computershare Investor Services plc, The Pavilions, Bridgwater Road, Bristol BS99 6ZY, by no later than 10.00 am on 24 May 2021.
• $(v)$ The proxy form includes details on how to vote electronically. The notes to the proxy form also include instructions on how to appoint a proxy by using the CREST proxy appointment service. You may not use any electronic address provided either in this notice of AGM or in any related documents (including the proxy form) to communicate with the Company for any purposes other than those expressly stated.
• In the case of joint holders of shares, the vote of the first named in $(v_i)$ the register of members who tenders a vote, whether in person or by proxy, shall be accepted to the exclusion of the votes of other joint holders.

Notice of the 2021 Annual General Meeting

Continued

• (vii) The following information is available at www.zotefoams.com: (1) the matters set out in this notice of AGM; (2) the total numbers of shares in the Company, and shares in each class, in respect of which members are entitled to exercise voting rights at the AGM; (3) the totals of the voting rights that members are entitled to exercise at the AGM, in respect of the shares of each class; and (4) members' statements, members' resolutions and members' matters of business received by the Company after the first date on which notice of the AGM was given
• (viii) If you are a person who has been nominated by a member to enjoy information rights in accordance with Section 146 of the Companies Act 2006, notes (iii) to (v) above do not apply to you (as the rights described in these notes can only be exercised by members of the Company) but you may have a right under an agreement between you and the member by whom you were nominated to be appointed or to have someone else appointed, as a proxy for the meeting. If you have no such right or do not wish to exercise it, you may have a right under such an agreement to give instructions to the member as to the exercise of voting rights.
• A member that is a company or other organisation not having a $(ix)$ physical presence cannot attend in person but can appoint someone to represent it. This can be done in one of two ways: either by the appointment of a proxy (described in notes (iii) to $\dot{N}$ ) above) or of a corporate representative. Members considering the appointment of a corporate representative should check their own legal position, the Company's Articles of Association and the relevant provision of the Companies Act 2006.
• Members attending the AGM have the right to ask, and, subject to the $(x)$ provisions of the Companies Act 2006, the Company must cause to be answered, any questions relating to the business being dealt with at the AGM.
• As at the close of business on 6 April 2021, the Company's issued $(xi)$ share capital comprised 48,621,234 ordinary shares of 5 pence each. Each ordinary share carries the right to one vote at a general meeting of the Company. No ordinary shares were held in treasury and accordingly the total number of voting rights in the Company as at the close of business on 6 April 2021 is 48,621,234
• (xii) Shareholders should note that it is possible that, pursuant to requests made by shareholders of the Company under Section 527 of the Companies Act 2006, the Company may be required to publish on a website a statement setting out any matter relating to: (i) the audit of the Company's accounts (including the auditor's report and the conduct of the audit) that are to be laid before the AGM; or (ii) any circumstance connected with the auditor of the Company ceasing to hold office since the previous meeting at which annual accounts and reports were laid in accordance with Section 437 of the Companies Act 2006. The Company may not require the shareholders requesting any such website publication to pay its expenses in complying with Section 527 or 528 of the Companies Act 2006. Where the Company is required to place a statement on a website under Section 527 of the Companies Act 2006, it must forward the statement to the Company's Auditor not later than the time when it makes the statement available on the website. The business which may be dealt with at the AGM includes any statement that the Company has been required under Section 527 of the Companies Act 2006 to publish on a website
• (xiii) Copies of the Executive Directors' service contracts with the Company and any of its subsidiary undertakings, deeds of indemnity in favour of the Directors and letters of appointment of the Non-Executive Directors are available for inspection at the registered office of the Company during the usual business hours on any weekday (Saturday, Sunday or public holidays excluded) from the date of this notice until the conclusion of the AGM.

Explanatory notes to the resolutions Ordinary business

Resolution 1 - Receiving the Annual Report

Shareholders will be asked to receive the Company's Annual Report for the financial year ended 31 December 2020, as required by law.

Resolution 2 - Directors' Remuneration report

Resolution 2 seeks shareholder approval of the Directors' Remuneration report for the year ended 31 December 2020 which can be found on pages 72 to 80 of the Annual Report. The Company's External Auditor. PKF Littlejohn LLP, has audited those parts of the Directors' Remuneration report that are required to be audited and its report may be found on pages 84 to 88 of the Annual Report.

The shareholders approved the current Directors' Remuneration Policy at the AGM held on 8 June 2020 and it became effective immediately. As there have been no changes to the Directors' Remuneration Policy, there is no need to seek further approval of it at this year's AGM. The current intention is to submit the Directors' Remuneration Policy for shareholder approval at the AGM scheduled for 2023, unless, in the interim, there are specific changes that require shareholder approval. The Directors' Remuneration Policy may be found in the 2019 Annual Report on pages 58 to 63.

Resolution 3 - Declaration of dividend

This resolution concerns the Company's final dividend payment. The Directors are recommending a final dividend of 4.27 pence per ordinary share in respect of the year ended 31 December 2020 which, if approved, will be payable on 1 June 2021 to the shareholders on the register of members on 7 May 2021.

Resolutions 4 to 10 - Re-election of Director

Biographies for the Directors are set out on pages 60 to 61 of the report and financial statements for the year ended 31 December 2020. With the Chair having undertaken performance reviews of the Directors, and the Non-Executive Directors having undertaken a performance review of the Chair, the Board is satisfied that each Director continues to be effective and demonstrates commitment to the role and recommends that each Director should be re-elected.

Resolutions 11 and 12 - Re-appointment of Auditor and its remuneration Resolution 11 concerns the re-appointment of PKF Littlejohn LLP as the Company's Auditor, to hold office until the conclusion of the Company's next general meeting where accounts are laid. Resolution 12 authorises the Audit Committee to determine the Auditor's remuneration.

Special business

Resolution 13 - Power to allot shares

This resolution grants the Directors authority to allot shares in the capital of the Company and other relevant securities up to an aggregate nominal value of £810,353, representing approximately one-third of the nominal value of the issued ordinary share capital of the Company as at 6 April 2021, being the latest practicable date before publication of this notice. In addition, in accordance with the latest institutional guidelines issued by the Investment Association, paragraph (b) of resolution 13 grants the Directors authority to allot further equity securities up to an aggregate nominal value of £1,620,706 representing approximately two-thirds of the nominal value of the issued ordinary share capital of the Company as at 6 April 2021, being the latest practicable date before publication of this notice. This additional authority may only be applied to fully pre-emptive rights issues.

The intention of the authority granted pursuant to paragraph (b) of resolution 13 is to preserve maximum flexibility and if the Directors do exercise this authority, they intend to follow best practice as regards its use.

The Company does not currently hold any shares as treasury shares within the meaning of Section 724 of the Companies Act 2006 ("Treasury Shares").

The Directors consider it desirable that the specified amount of authorised but unissued share capital is available for issue so that they can more readily take advantage of possible opportunities, which may include the allotment of shares to the Employee Benefit Trust for the purpose of fulfilling future potential awards.

Unless revoked, varied or extended, this authority will expire at the conclusion of the next AGM of the Company or 30 June 2022, whichever is the earlier.

Resolutions 14 and 15 - Authority to allot shares disregarding pre-emption rights

These resolutions authorise the Directors in certain circumstances to allot equity securities for cash other than in accordance with the statutory pre-emption rights (which require a company to offer all allotments for cash first to existing shareholders in proportion to their holdings). Resolution 14 authorises the Directors to issue shares either where the allotment takes place in connection with a rights issue or the allotment is limited to a maximum nominal amount of £121,553, representing approximately 5% of the nominal value of the issued ordinary share capital of the Company as at 6 April 2021, being the latest practicable date before publication of this notice. Resolution 15 authorises the Directors to issue a further 5% of the issued ordinary share capital of the Company, but only to be used to raise finance for an acquisition or a specified capital investment (within the meaning given in the Pre-Emption Group's Statement of Principles) which is announced contemporaneously with the allotment, or which has taken place in the preceding six-month period and is disclosed in the announcement of the allotment

Unless revoked, varied or extended, these authorities will expire at the conclusion of the next AGM of the Company or 30 June 2022, whichever is the earlier.

The Directors consider that the powers proposed to be granted by these resolutions are necessary to retain flexibility, although they do not have any intention at the present time of exercising them. In accordance with the Pre-Emption Group's Statement of Principles, the Directors confirm that they do not intend to issue more than 7.5% of the issued ordinary share capital of the Company on a non-pre-emptive basis in any rolling three-year period without prior consultation with Shareholders.

Resolution 16 - Authority to purchase shares (market purchases)

This resolution authorises the Board to make market purchases of up to 4,862,123 ordinary shares (representing approximately 10% of the Company's issued ordinary shares as at 6 April 2021, being the latest practicable date before publication of this notice). Shares so purchased may be cancelled or held as Treasury Shares. The authority will expire at the end of the next AGM of the Company or 30 June 2022, whichever is the earlier. The Directors intend to seek renewal of this authority at subsequent AGMs.

The minimum price that can be paid for an ordinary share is 5 pence, being the nominal value of an ordinary share. The maximum price that can be paid is 5% over the average of the middle market prices for an ordinary share, derived from the Daily Official List of the London Stock Exchange, for the five business days immediately before the day on which the share is contracted to be purchased.

The Directors intend to exercise this right only when, in light of the market conditions prevailing at the time and taking into account all relevant factors (for example, the effect on earnings per share), they believe that such purchases are in the best interests of the Company and shareholders generally and will result in an increase in earnings per ordinary share. The overall position of the Company will be taken into account before deciding upon this course of action. The decision as to whether any such shares bought back will be cancelled or held in treasury will be made by the Directors on the same basis at the time of the purchase.

As at 6 April 2021, being the latest practicable date before publication of this notice, there were outstanding awards under the Company's longterm incentive schemes (excluding the Share Incentive Plan) in respect of 900,363 ordinary shares in the capital of the Company representing 1.9% of the Company's issued ordinary share capital. If the authority to purchase the Company's ordinary shares were exercised in full, such awards would represent 2.1% of the Company's issued ordinary share capital.

Resolution 17 - Notice period for general meetings

Under the Companies Act 2006, a listed company must give at least 21 days' notice of its general meetings. However, the Act enables general meetings (other than AGMs) to be held on shorter notice of not less than 14 days, provided the shareholders have given their consent at the previous AGM or a general meeting held since the last AGM. Resolution 17 seeks such approval similar to the resolution that was passed last year. The approval will be effective until the Company's next AGM, when it is intended that a similar resolution will be proposed. The Directors will always endeavour to give as much notice as possible of general meetings, but would like to have the flexibility to call a general meeting on the shorter permitted notice period for time sensitive matters that are clearly in the shareholders' interests and otherwise for non-routine business, where merited, in the interests of shareholders as a whole. If the authority is used. the Company will offer the ability, as required by the Companies Act 2006, to vote electronically.

Resolution 18 - New articles of association

Resolution 18 proposes that the Company adopts updated Articles of Association (the "New Articles"), principally in order to reflect developments in law and practice since the Company's current articles (the "Current Articles") were adopted in 2010. A copy of the New Articles, together with a copy marked to show the changes from the Current Articles, is available for inspection and can be viewed on the Company's website.

A summary of the principal changes is set out below:

Hybrid General Meetings: The New Articles give the Directors the power to convene a hybrid general meeting, being a meeting which has the facilities for shareholders to attend either wholly by electronic platforms or by both in a physical place and via electronic platforms. The New Articles do not give the Directors the power to hold a solely electronic General Meeting. The provisions included in the New Articles include, for example, the details that need to be provided to shareholders if such a meeting is to be held and a requirement that all resolutions must be taken on a poll in the event of a hybrid meeting. The Directors consider that the Company should properly have the ability to convene hybrid general meetings should the circumstances require this.

Untraced members: In line with market practice, the New Articles provide additional flexibility in relation to the sale of shares owned by shareholders who are untraced after a period of at least 12 years. Under the Current Articles, the Company is required to give notice to untraced shareholders of an intention to sell their shares by way of an advertisement in one national daily newspaper and one local newspaper circulating in the area in which the shareholder's last known address is known by the Company. Under the New Articles, the Company must instead send a notice to the last registered or known address of the shareholder and use reasonable steps to trace the shareholder including, if considered appropriate, using a professional asset reunification company or other tracing agent.

Additionally, under the New Articles, in respect of the proceeds of shares sold on behalf of an untraced member, the Company may use or invest such proceeds as the Directors see fit.

Sub-division of shares: The New Articles, in line with market practice, provide that a resolution to sub-divide shares may include the creation of deferred shares, so as to make administering any sub-division of shares more straightforward.

Postponement/Change of general meeting: The New Articles now expressly permit the Directors, in line with current market practice, to give notice of any change or postponement to be advertised in the manner that the Directors (in their discretion) decide.

Votes of members: To reflect guidance published by The Chartered Governance Institute, the New Articles confirm that the Company is not required to ascertain whether a proxy or corporate representative has voted in accordance with the member's instructions.

Scrip dividends: In accordance with the IA Share Capital Management Guidelines 2016, the expiry period for an ordinary resolution authorisation in respect of a scrip dividend has been limited to three years.

Minor amendments: Some additional minor changes have been made to the New Articles, including to clarify the position in relation to the annual retirement of Directors and how to deal with fractional entitlements on a sub-division of shares.

Recommendation

The Directors consider that the proposals being put to the shareholders at the AGM are in the best interests of the Company and of the shareholders as a whole. Accordingly, the Directors recommend that you vote in favour of the resolutions set out in the Notice of the AGM, as they intend to do in respect of their own beneficial holdings of ordinary shares.