Announcement PDF Monday 13 November 2023 Notice of 2023 Annual General Meeting Attached is notice of the Elders Limited (ASX:ELD) Annual General Meeting of shareholders to be held on Thursday 14 December 2023, from 10.00am (ACDT). Further Information: Peter Hastings, Company Secretary, 0419 222 489 Authorised by: Elders Limited Board of Directors Elders Limited ABN 34 004 336 636. Registered Office: Level 10, 80 Grenfell Street, Adelaide SA Australia 5000 NOTICE OF MEETING 2023 For Australian Agriculture 2023 Elders Annual General Meeting Notice is hereby given that the 69th Annual General Meeting of Shareholders of Elders Limited (Company) will be held on Thursday 14 December 2023, commencing at 10.00am (ACDT) in the City Room, Adelaide Convention Centre, North Terrace, Adelaide, South Australia 5000 Shareholders are encouraged to join virtually or in person Elders Limited ABN 34 004 336 636 Elders Limited ABN 34 004 336 636 Level 10, 80 Grenfell Street Adelaide, SA, Australia 5000 GPO Box 551, Adelaide SA 5001 p | 08 8425 4000 elders.com.au 13 November 2023 Dear Shareholder, It is my pleasure to invite you to attend the 2023 Annual General Meeting (AGM) of Elders Limited (Elders), which will take place on Thursday 14 December 2023 at 10.00am (ACDT). This Notice of Meeting and Explanatory Notes detail the business that will be dealt with at that meeting. Your Board is looking forward to meeting with you in person, while continuing to facilitate online attendees. We hope that this will mean as many Shareholders as possible will join and participate in the meeting. Information about participation in the meeting, how to submit questions and voting on resolutions is set out in this Notice and further detail can be found by visiting boardroomlimited.com.au/agm/elders23. I encourage you to consider voting online ahead of the meeting, particularly if you are unable to join us at the prescribed time on 14 December 2023. If you attend the meeting and decide to change your vote, you can do so while voting remains open in the meeting. The Elders Board believes the resolutions proposed in the Notice and described in the Explanatory Notes are in the best interests of Elders’ Shareholders and, subject to the abstentions stated in the Notice, unanimously recommends that you vote in favour of all items. If you appoint me as your proxy, or I become your proxy by default, but you do not direct me how to vote, I intend to vote in favour of all items. Thank you for your continued support of our great company. Yours sincerely, Ian Wilton Chair Notice of 2023 Annual General Meeting Notice of 2023 Annual General Meeting Agenda Thursday, 14 December 2023 10.00 am ACDT In the City Room, Adelaide Convention Centre, North Terrace, Adelaide, South Australia 5000 and online at web.lumiagm.com/360005678. Shareholders are encouraged to join virtually or in person. 4. Managing Director’s LongTerm Incentive To consider and, if thought fit, to pass the following resolution as an ordinary resolution: “That for the purposes of ASX Listing Rule 10.14, and for all other purposes, the grant of 283,990 performance rights to the Managing Director and Chief Executive Officer, Mr Mark Charles Allison, on the terms specified in the Explanatory Notes to the Notice of Meeting be approved.” 5. Managing Director's Service Rights To consider and, if thought fit, to pass the following resolution as an ordinary resolution: 1. Financial Statements and Reports To receive and consider the Financial Statements and the Reports of the Directors and Auditor for the 12 month period ended 30 September 2023. No vote is held in connection with this item. 2. Remuneration Report To consider and, if thought fit, to pass the following resolution: “That the Remuneration Report, which forms part of the Directors’ Report, for the 12 month period ended 30 September 2023 be adopted.” Note that the vote on this item is advisory only and does not bind the Company or the Directors of the Company. 3. Election of John Lloyd To consider and, if thought fit, to pass the following resolution as an ordinary resolution: “That John Lloyd, having been appointed as a Director by the Board since the last Annual General Meeting, who retires in accordance with Rule 8.1.5(a) of the Constitution of the Company, and being eligible, is elected as a director of the Company.” “That for the purposes of ASX Listing Rule 10.14, and for all other purposes, the grant of 180,000 service rights to the Managing Director and Chief Executive Officer, Mr Mark Charles Allison, on the terms specified in the Explanatory Notes to the Notice of Meeting be approved.” 6. Approval of Issue of Securities Under Long-Term Incentive Plan Exception to ASX Listing Rule 7.1 To consider and, if thought fit, to pass the following resolution as an ordinary resolution: “That for the purposes of ASX Listing Rule 7.2, Exception 13, and for all other purposes, the issue of securities under the LongTerm Incentive Plan, as described in the Explanatory Notes to the Notice of Meeting, be approved.” 7. Renewal of Proportional Takeover Approval Rule To consider and, if thought fit, to pass the following resolution as a special resolution: “That the proportional takeover rule in the form of rule 6 of the Company's Constitution, as last approved by Shareholders on 17 December 2020, be renewed in the Constitution for a period of three years from the date of the meeting.” Please refer to the accompanying Explanatory Notes, which form part of this Notice of Meeting, for more information on the proposed resolutions. By Order of the Board Peter Hastings Company Secretary 13 November 2023 3 4 2023 Elders Notice of Annual General Meeting Explanatory Notes The following notes have been prepared to assist Shareholders to better understand the business to be considered by Shareholders at the 2023 Annual General Meeting. The Directors recommend that Shareholders read the Explanatory Notes before determining whether to support the resolutions. Item 1 — To Receive and Consider the Financial Statements and Reports of the Directors and Auditor In accordance with the requirements of the Corporations Act 2001 (Cth) (Corporations Act), the Financial Statements and Reports of the Directors and the Auditor for the 12 month period ended 30 September 2023 will be laid before the meeting. Shareholders as a whole will be given a reasonable opportunity at the meeting to ask questions or make comments on the management of the Company. Shareholders may also submit written questions to the Auditor relevant to the content of the Auditor’s Report or the conduct of the audit up to five business days prior to the AGM. A reasonable opportunity will be given at the AGM for Shareholders as a whole to ask the Auditor or its representatives questions relevant to the conduct of the audit, the preparation and content of the Auditor’s Report, the accounting policies adopted by the Company in relation to the preparation of the financial statements and the independence of the auditor in relation to the conduct of the audit. Elders encourages all Shareholders to elect to receive documents by email to ensure efficient and timely communication. The 2023 Annual Report (which includes the Financial Statements and Reports of the Directors and the Auditor) has been emailed to Shareholders who have provided an email address and elected to receive a digital copy. A digital copy is also located on the Company’s website at: https://elders.com.au/forinvestors/performance/periodic-reports/. A hard copy of the 2023 Annual Report will be mailed to all Shareholders who have elected to receive a printed copy. Neither the Corporations Act nor the Company's Constitution requires Shareholder approval of these Statements and Reports. Accordingly, no vote is held in connection with this item. Item 2 — To Adopt the Remuneration Report The Corporations Act requires the Company to propose a resolution to Shareholders that the Remuneration Report be adopted. The Remuneration Report, which forms part of the Directors’ Report, can be found in the Company’s 2023 Annual Report. The Remuneration Report includes: 1. an explanation of the Company’s policy for determining the nature and amount of remuneration of Key Management Personnel (KMP); 2. a discussion of the relationship between the remuneration policy and the Company’s performance; and 3. a detailed summary of remuneration components for KMP including relevant performance conditions. Although the vote on this resolution is advisory only and does not bind the Company or its Directors, the Board will take the outcome of the vote and the views of Shareholders into consideration when reviewing remuneration policies and practices. Voting Exclusion Statement The Company will disregard any votes cast on Item 2: • by or on behalf of a member of the KMP whose remuneration details are included in the Remuneration Report (and their closely related parties), regardless of the capacity in which the vote is cast; or • by a member of the KMP (and their closely related parties) at the date of the meeting acting as proxy. However, the Company need not disregard a vote if: • it is cast by a person as proxy for a person who is entitled to vote, in accordance with the directions on the proxy form; or • it is cast by the person chairing the meeting as proxy for a person who is entitled to vote, in accordance with an express authorisation to vote as the proxy decides even though Item 2 is connected with the remuneration of the KMP. Notice of 2023 Annual General Meeting The term ‘closely related party’ is defined in the Corporations Act and includes the KMP’s spouse, child, dependents and certain other close family members, as well as any companies controlled by the KMP. current appointments as a Non-Executive Director of Meat and Livestock Australia, Wine Australia and the Grains and Legumes Nutrition Council. Mr Lloyd is also a council member of Charles Sturt University. Board Recommendation Mr Lloyd's previous executive roles include CEO of Horticulture Innovation Australia, Managing Director of Case New Holland ANZ, General Manager Commercial at Incitec Pivot and General Manager Merchandise at Wesfarmers Dalgety. Acknowledging that each Director has a personal interest in their own remuneration from the Company as set out in the Remuneration Report, the Board unanimously recommends that Shareholders vote in favour of adopting the Remuneration Report. In addition to understanding of the industry, Mr Lloyd brings to the Board skills in CEO and leadership oversight, strategy and planning, government relations, change and major project delivery, sales and account management. Item 3 — Election of John Lloyd Mr Lloyd is a resident of New South Wales. As announced on 22 September 2023, Mr Lloyd was appointed to the Board effective 1 December 2023. Mr Lloyd will retire at the AGM in accordance with Rule 8.1.5(a) of the Company’s Constitution and will stand for election. Prior to his appointment, appropriate checks were carried out relating to Mr Lloyd's character, experience, education, criminal record and bankruptcy history. None of these checks revealed any information of concern. John Lloyd BSc, MBA The Board appointed Mr Lloyd, effective 1 December 2023. Upon his commencement with Elders, John will become a member of the Audit, Risk and Compliance Committee; the Remuneration, People and Culture Committee; the Safety and Sustainability Committee and the Nomination and Prudential Committee. Mr Lloyd holds a Bachelor of Science, Wool and Pastoral, from the University of NSW and an MBA from the Macquarie Graduate School of Management. Mr Lloyd has extensive experience in the agricultural industry, including Mr Lloyd has confirmed to the Company that he has sufficient time to continue to fulfil his responsibilities as a director of Elders. He has estimated his other commitments require approximately 90 hours per month. Board Recommendation For the reasons set out above, the Board unanimously recommends the election of Mr Lloyd as a director. For the avoidance of doubt, Mr Lloyd was not a member of the Board as at the date of this Notice and did not participate in the making of this recommendation. The Board considers Mr Lloyd, if elected, to be an independent director. Item 4 — Managing Director’s Long-Term Incentive The Board considers, in accordance with generally accepted remuneration practices in Australia, that an equity-based LongTerm Incentive is integral to linking the Managing Director and CEO’s remuneration with long-term value for Shareholders. The Board continually reviews the design of the remuneration framework to ensure it: • meets its objectives in supporting the overall business strategy • is aligned with shareholder interests • is competitive and reflects market practice • is simple for both participants and Shareholders to understand Since 2021, shares have been purchased on market to be allocated to participants upon the vesting of performance rights. Prior to this, shares were issued to satisfy the vesting outcomes. The Board considers that this change is beneficial to Shareholders as it removes the dilutive effect of issuing new shares upon vesting of performance rights. Nonetheless, shares to satisfy the vesting outcomes under Elders' Long-Term Incentive Plan (Plan) may either be purchased on market or issued. Shareholder approval is being sought for the proposed grant of performance rights to Mr Mark Allison, pursuant to the Plan, on the terms set out below and in accordance with ASX Listing Rule 10.14. Listing Rule 10.14 provides that a company must not issue equity securities to a director under an employee incentive scheme without the approval of Shareholders. Shareholder approval is required under Listing Rule 10.14.1 because Mr Allison is a Director of Elders Limited. Terms of proposed grant Maximum number of performance rights The proposed grant is for 283,990 performance rights. The grant represents the LTI component of the CEO’s remuneration package for the financial year ending 30 September 2024. The maximum number of performance rights was calculated using a face value equivalent to the 5 trading day volume weighted average price as at 30 September 2023 ($5.81) rounded down to the nearest 10. The performance rights will be granted at no cost to Mr Allison as they form part of his remuneration package, and no amount is payable on vesting of the rights if the performance and service conditions are met. Subject to the satisfaction of the performance and service conditions below, each performance right entitles Mr Allison to one fully paid ordinary share in the Company that carries the same rights as other ordinary shares in the Company. Under the Plan Rules, the Board has discretion to make a cash payment in lieu of an allocation of shares. Performance period Rights attaching to performance rights Date of issue 5 The performance of each Tranche against the applicable performance hurdle will be measured over the three-year performance period from 1 October 2023 to 30 September 2026. Performance rights carry no voting or dividend entitlements until they vest into shares. Mr Allison must not sell, transfer, encumber, hedge or otherwise deal with unvested performance rights. If shareholder approval is obtained, the performance rights will be issued to Mr Allison shortly after the AGM and no later than 28 February 2024. 6 2023 Elders Notice of Annual General Meeting Terms of proposed grant Performance conditions The Board has determined that the grants will be divided into two tranches, each of which will comprise 50% of the grant. Tranche 1: 50% of the grant will be subject to Elders’ Total Shareholder Return (TSR) performance relative to the TSR performance of the Comparator Companies. Relative TSR against Comparator Companies The Comparator Group comprises the companies in the S&P/ASX 200 index as at the start of the Performance Period. Any companies that are delisted from the ASX during the Performance Period or suspended from trading at the end of the Performance Period will be removed from the vesting assessment. The Board has absolute discretion over the calculation methodology and may adjust the Comparator Companies to take into account events including, but not limited to, takeovers, mergers or de-mergers that might occur during the performance period. TSR is the Board’s measurement of the entire return a Shareholder would obtain over the Performance Period. The measure takes into account changes in the share’s market value, dividends paid and any significant capital actions that occur during the period. The start and end share values are calculated as the Volume Weighted Average Price over 5 trading days, respectively, at the start and end of the Performance Period. The percentage of Mr Allison’s performance rights that will vest under Tranche 1 is set out in the table below: Elders’ TSR percentile rank over the Performance Period Percentage of Tranche 1 Performance Rights that vest Less than 50th percentile 0% At 50th percentile 50% Between 50th and 75th percentile 50-100%, increasing on a pro-rata basis At 75th percentile or above 100% To ensure an objective assessment of the relative TSR comparison, Elders engages an independent organisation to calculate the TSR ranking. Gateway Performance rights under this tranche will only vest in accordance with the above vesting schedule if Elders’ absolute TSR over the Performance Period is greater than or equal to zero. Tranche 2: Earnings per share (EPS) The remaining 50% of the grant will be subject to an EPS hurdle which measures Elders’ compound annual EPS growth rate (EPS CAGR) over the performance period. The EPS vesting schedule is as follows: Target measure: 7.5% EPS CAGR over the performance period Stretch measure: 10% EPS CAGR over the performance period Actual EPS CAGR over the performance period Percentage of Tranche 2 Performance Rights that vest Less than Target 0% Target 50% Between Target and Stretch 50-100%, increasing on a pro-rata basis Stretch and above 100% Unless the Board determines otherwise, NPAT used in determining EPS will be Underlying NPAT as presented in the Company’s Annual Reports and shares issued will be the weighted average shares outstanding for each period as per statutory reporting. Opening EPS The opening EPS value used for the performance testing calculation for this grant will be the FY23 EPS, calculated using underlying FY23 NPAT, being 66.3c (at the date of printing, although subject to finalisation of the FY23 external audit). The difference between the statutory FY23 EPS and the opening EPS for this grant is reconciled in the FY23 Remuneration Report. The Long-Term Incentive Plan grant to Mr Allison (the terms of which flow through to other participants in the plan) approved by Shareholders at the December 2020 AGM was set on the assumption that historical tax losses would continue to offset company tax expense for the duration of the performance period. Company performance has exceeded growth assumed in the setting of that plan, and, therefore, historical tax losses have been utilised more quickly than expected. Accordingly, the Board has exercised its discretion to adjust the FY23 testing EPS for the impact of this additional company tax expense. This ensures comparability across the performance period of the plan. As a consequence, the closing FY23 EPS for the grant approved by Shareholders at the December 2020 AGM, as outlined in the FY23 Remuneration Report, is 87.6c (at the date of printing, although subject to finalisation of the FY23 external audit). Use of the Board’s discretion was foreshadowed in the FY21 Remuneration Report. Performance testing Testing of the performance conditions will occur once the results for the financial year ending 30 September 2026 have been approved by the Board. Performance rights will only vest once the Board, in its discretion, determines that relevant conditions have been satisfied. Any performance rights that do not vest will immediately lapse. There is no re-testing of performance. The Board may exercise discretion when testing performance conditions and determining vesting outcomes. Notice of 2023 Annual General Meeting Terms of proposed grant Participants will be allocated one fully paid ordinary share in Elders for each Performance Right that vests. Restrictions and rights after vesting For performance rights that vest, shares will be allocated to Mr Allison. These shares will be held in trust for an additional 12 month period and will be subject to a service condition. During this time, Mr Allison will not be able to deal with these shares. However, during the 12 month restriction period, Mr Allison will be entitled to receive dividends and other distributions and have full voting rights in respect of any shares allocated to him on vesting of the performance rights. Once the 12 month holding restriction is lifted, Mr Allison will be free to deal with the shares allocated, subject to the requirements of the Company’s Securities Dealing Policy. Summary of the Terms of the Long-Term Incentive Plan Offers under the Plan and eligibility The Board may invite Eligible Employees to participate in a grant of performance rights. Offers will be made on the terms set out in the Plan and on any additional terms determined by the Board. An Eligible Employee is an employee of the Elders Group, including a director employed in an executive capacity, or any other person who is declared by the Board to be eligible to receive a grant of performance rights under the Plan. Non-Executive Directors are not eligible to participate in the Plan. In December 2021, Shareholders approved the issue of securities under the Long-Term Incentive Plan as an exception to Listing Rule 7.1. The explanatory notes to the 2021 Notice of Meeting advised that a maximum of 1,700,000 performance rights were proposed to be issued under the Long-Term Incentive Plan for the three years ending 30 September 2022 to 30 September 2024. A new resolution is set out in Item 6, seeking approval of the issue of securities under the Long-Term Incentive Plan as an exception to Listing Rule 7.1. If shareholders approve the resolution in item 6, it is anticipated that a maximum of 3,500,000 performance rights (including those issued to Mr Allison) and 180,000 service rights will be issued under the Plan in connection with the Long-Term Incentive component of the remuneration packages of Eligible Employees for years ending 30 September 2024-2026. Vesting Restricted shares and performance rights granted under the Plan will only vest where any performance condition and any other relevant conditions advised to the participant by the Board have been satisfied. On vesting of a performance right, the Board will allocate the number of shares in respect of the performance rights vested. Any shares issued under the Plan will rank equally in all respects with other shares on issue at that time (except as regards any rights attaching to such shares by reference to a record date prior to the date of their issue). Cessation of employment On cessation of employment due to: • retirement • genuine redundancy • death or total and permanent disablement • termination without cause subject to the Board's discretion to determine otherwise no later than 60 days after cessation of employment and subject to the participant's consent: • shares held under the 12 month holding restriction will be released to the participant and the participant will be free to deal with the shares • a portion of unvested performance rights will remain on foot and will be tested in the ordinary course as though the participant's employment had not ceased. The pro-rata portion will be calculated having regard to the proportion of the performance period served. All other unvested performance rights will lapse on cessation of employment. If the participant ceases employment for any other reason, all of the participant's unvested performance rights will lapse, and all of the participant's shares held under the 12 month holding restriction will be forfeited, unless the Board determines otherwise no later than 60 days after cessation of employment, and the participant consents to retaining the performance rights. Change of control In the event of a transaction, event or state of affairs that, in the Board’s opinion, is likely to result in a change of control of the Company, the Board may, in its absolute discretion, determine that all or a specified number of a participant's unvested performance rights or shares held under the 12 month holding restriction vest or cease to be subject to restrictions (as the case may be). Alternatively, the Company may agree with an acquiring company and the participant, to substitute any unvested performance rights with awards in the acquiring company on comparable terms. If the Board does not make a determination, participants will retain all of their performance rights and the performance rights will continue to be subject to the original terms of the grant. Corporate actions/ reconstructions Prior to the allocation of shares to a participant upon vesting of performance rights, the Board may make any adjustments it considers appropriate to the terms of a performance right granted to a participant in order to minimise or eliminate any material advantage or disadvantage to a participant resulting from a corporate action or capital reconstruction. Clawback The Board may determine that any unvested rights or shares held under the 12 month holding restriction will lapse or be forfeited (as the case may be), and/or the participant must pay or repay as a debt in relation to proceeds and dividends from shares allocated in certain circumstances such as, but not limited to, fraud, gross misconduct, breach of duties or obligations. Dealings in performance rights Participants are prohibited from taking out derivatives over performance rights. In addition, after vesting of performance rights, all dealings in shares issued to a participant are regulated by Elders' Securities Dealing Policy which requires, amongst other things, that dealings only take place during open periods specified by Elders. Exercise of Board discretion The Board may exercise its discretion to make adjustments it considers appropriate in light of the purpose and intent of the Plan and the performance conditions. This may include making adjustments to ensure that the interests of the 7 8 2023 Elders Notice of Annual General Meeting Summary of the Terms of the Long-Term Incentive Plan relevant Participant are not, in the opinion of the Board, materially prejudiced or advantaged relative to the position reasonably anticipated at the time of the grant. The Board uses a number of principles to assess whether to make an adjustment, including: • maintaining the desired level of stretch for targets • maintaining the integrity and intention of the reward • aligning outcomes with general market and shareholder expectations • consistent treatment across remuneration elements and performance period • preserving the success and intent of transactions or other actions that have materially benefitted the company If discretion is to be exercised, it may be a result of events such as: • acquisitions and acquisition costs • divestments • legislative or accounting standard changes • changes to tax treatments • capital reconstructions or corporate actions • internal reorganisation of the business and/or group assets • events affecting Comparator Companies including, but not limited to, takeovers, mergers or de-mergers that might occur during the Performance Period • events, circumstances or significant items outside of the control of management or which are not reflective of management performance Other information required by ASX listing rules Total remuneration package for FY23 Details (including the amount) of Mr Allison’s total remuneration package are as follows: Total Fixed Remuneration, including Superannuation (TFR) A$1,500,000 Short-Term Incentive opportunity 100% of TFR at maximum Long-Term Incentive opportunity 110% of TFR at maximum (on face value basis) Retention cash bonus A$1,000,000 Service Rights 180,000 Further details of Mr Allison’s remuneration are outlined in the Remuneration Report. Other information • Mr Allison is the only director currently entitled to participate in the Company’s Long-Term Incentive Plan. • Mr Allison is a director of Elders, and accordingly, falls within the director category under ASX Listing Rule 10.14.1. As at the date of this Notice, no other people covered under Listing Rule 10.14 participate in the Long-Term Incentive Plan. If any person not named in this Notice and covered by Listing Rule 10.14 does become entitled to participate in an issue of securities under the Long-Term Incentive Plan after the resolution in Item 4 is approved, that person will not participate until shareholder approval is obtained under that Listing Rule. • The performance rights, and any shares received upon vesting, will be granted under the Company’s Long-Term Incentive Plan Rules. • If this resolution is not approved, the Board will consider alternative arrangements to appropriately remunerate and incentivise Mr Allison. • Details of any securities issued under the Long-Term Incentive Plan will be published in the Company’s Annual Report relating to the period in which they were issued, along with a statement that approval for the issue was obtained under Listing Rule 10.14. • The Company has not advanced a loan in relation to this grant of performance rights. • Elders grants performance rights under its Executive Long-Term Incentive Plan as they create share price alignment between Executives and Shareholders but do not