Chemring : Notice of Annual General Meeting 2022

CHEMRING GROUP PLC NOTICE OF ANNUAL GENERAL MEETING 3 MARCH 2022

To be held at the offices of:

Investec Bank, 30 Gresham Street, London EC2V 7QP

THIS DOCUMENT IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION.

If you are in any doubt about its contents you should consult your independent financial adviser. If you have sold or transferred all of your Chemring Group PLC ordinary shares you should send this document and all 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.

NOTICE OF ANNUAL GENERAL MEETING

Notice is hereby given that the 116th Annual General Meeting of the shareholders will be held at 11.00am on 3 March 2022 at the offices of Investec Bank, 30 Gresham Street, London EC2V 7QP, for the purpose of considering and, if approved, passing the following resolutions:

ORDINARY RESOLUTIONS

1. To receive and adopt the Company's annual accounts for the year ended 31 October 2021, together with the directors' report, the strategic report and the auditor's report on those accounts.
2. To approve the directors' remuneration policy, as set out on pages

97 to 107 of the directors' remuneration report contained within the Company's annual report and accounts for the year ended

31 October 2021, such directors' remuneration policy to become binding immediately after the end of the Annual General Meeting on 3 March 2022.

1. To receive and approve the directors' remuneration report (other than the part containing the directors' remuneration policy referred to in resolution 2 above) contained within the Company's annual report and accounts for the year ended 31 October 2021.
2. To approve the payment of a final dividend of 3.2p per ordinary share for the year ended 31 October 2021.
3. To re-elect Mr Carl-Peter Forster as a director.
4. To re-elect Mrs Laurie Bowen as a director.
5. To re-elect Mr Andrew Davies as a director.
6. To re-elect Mrs Sarah Ellard as a director.
7. To re-elect Mr Stephen King as a director.
8. To re-elect Mr Andrew Lewis as a director.
9. To re-elect Mrs Fiona MacAulay as a director.
10. To re-elect Mr Michael Ord as a director.
11. To reappoint KPMG LLP as the Company's auditor, to hold office from the conclusion of the Annual General Meeting on 3 March 2022 until the conclusion of the next meeting at which accounts are laid before the Company.
12. To authorise the directors to agree KPMG LLP's remuneration as the auditor of the Company.
13. (a) That the directors be generally and unconditionally authorised pursuant to section 551 of the Companies Act 2006 (the "Act") to:
14. 1. allot shares in the Company, and to grant rights to subscribe for or to convert any security into shares in the Company:
    2. 1. up to an aggregate nominal amount of £943,835; and
       2. comprising equity securities (as defined in the Act) up to an aggregate nominal amount of £1,887,670 (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:

1. to holders of ordinary shares in proportion (as nearly as may be practicable) to their existing holdings; and

1. 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 after the date on which this resolution is passed (or, if earlier, at the close of business on 3 June 2023); and

1. 1. 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;
2. that subject to paragraph (c), all existing authorities given to the directors pursuant to section 551 of the Act be revoked by this resolution; and
3. 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.

SPECIAL RESOLUTIONS

16. That, subject to the passing of resolution 15 in the notice of the meeting and in place of all existing powers, the directors be generally empowered pursuant to section 570 and section 573 of the Act to allot equity securities (as defined in the Act) for cash, pursuant to the authority conferred by resolution 15 in the notice of the meeting as if section 561(1) of the Act did not apply to the allotment. This power:

1. expires (unless previously renewed, varied or revoked by the Company in general meeting) at the end of the next annual general meeting of the Company after the date on which this resolution is passed (or, if earlier, at the close of business on 3 June 2023), but the Company may make an offer or agreement which would or might require equity securities to be allotted after expiry of this power and the directors may allot equity securities in pursuance of that offer or agreement as if this power had not expired; and
2. shall be limited to the allotment of equity securities in connection with an offer of equity securities (but in the case of the authority granted under resolution 15(a)(i)(B), by way of a rights issue only):
3. 1. to the ordinary shareholders in proportion (as nearly as may be practicable) to their existing holdings; and
   2. to people who hold 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; and

1. in the case of the authority granted under resolution 15(a)(i)(A) shall be limited to the allotment of equity securities for cash otherwise than pursuant to paragraph (b) up to an aggregate nominal amount of £141,575.

This power applies in relation to a sale of shares which is an allotment of equity securities by virtue of section 560(3) of the Act as if in the first paragraph of this resolution the words "pursuant to the authority conferred by resolution 15 in the notice of the meeting" were omitted.

2 Chemring Group PLC Notice of Annual General Meeting 2022

SPECIAL RESOLUTIONS continued

17. That, subject to the passing of resolution 15 in the notice of the meeting and in addition to any power given to them pursuant to resolution 16 in the notice of the meeting, the directors be generally empowered pursuant to section 570 and section 573 of the Act to allot equity securities (as defined in the Act) for cash, pursuant to the authority conferred by resolution 15 in the notice of the meeting as if section 561(1) of the Act did not apply to the allotment. This power:

1. expires (unless previously renewed, varied or revoked by the Company in general meeting) at the end of the next annual general meeting of the Company after the date on which this resolution is passed (or, if earlier, at the close of business on
   3 June 2023), but the Company may make an offer or agreement which would or might require equity securities to be allotted after expiry of this power and the directors may allot equity securities in pursuance of that offer or agreement as if this power had not expired; and
2. in the case of the authority granted under resolution 15(a)(i)(A) shall be limited to the allotment of equity securities for cash up to an aggregate nominal amount of £141,575 and provided that the allotment is for the purposes of financing (or refinancing, if the power is used within six months of 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 the notice of the meeting.

This power applies in relation to a sale of shares which is an allotment of equity securities by virtue of section 560(3) of the Act as if in the first paragraph of this resolution the words "pursuant to the authority conferred by resolution 15 in the notice of the meeting" were omitted.

18. That the Company be and is hereby generally and unconditionally 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 any of its ordinary shares in the capital of the Company ("Shares") on such terms and in such manner as the directors may from time to time determine, and where such Shares are held as treasury shares, the Company may use them for the purposes of its employee share schemes, provided that:

1. the maximum aggregate number of Shares which may be purchased is 28,315,052;
2. the minimum price (exclusive of expenses) which may be paid for a Share is the nominal value thereof;
3. the maximum price (exclusive of expenses) which may be paid for a Share is the higher of:
4. 1. an amount equal to 105 per cent of the average of the middle market quotations for a Share as derived from the Daily Official List of the London Stock Exchange plc for the five business days immediately preceding the day on which such Share is contracted to be purchased; and
   2. an amount equal to the higher of the price of the last independent trade of a Share and the highest current independent bid for a Share on the trading venue where the purchase is carried out,

and (unless previously renewed, revoked or varied), this authority shall expire at the conclusion of the next annual general meeting of the Company after the passing of this resolution or on 3 June 2023 (whichever is the earlier), save that the Company may make a contract

to purchase Shares which would or might be executed wholly or partly after the expiry of this authority, and may make purchases of Shares pursuant to it as if this authority had not expired.

All previous unutilised authorities to make market purchases of Shares are revoked, except in relation to the purchase of Shares under a contract or contracts concluded before the date of this resolution and where such purchase has not yet been executed.

19. That the Company be and is hereby generally and unconditionally authorised, from the date of the passing of this resolution and expiring at the conclusion of the next annual general meeting of the Company, to hold general meetings (other than annual general meetings) on not less than fourteen clear days' notice.

By order of the Board

Sarah Ellard

Group Legal Director & Company Secretary

10 January 2022

CHEMRING GROUP PLC

Roke Manor

Old Salisbury Lane

Romsey

Hampshire

SO51 0ZN

Chemring Group PLC Notice of Annual General Meeting 2022

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NOTES ON RESOLUTIONS

Resolutions 1 to 15 are proposed as ordinary resolutions. This means that for each of those resolutions to be passed, more than half of the votes cast must be in favour of the resolution. Resolutions 16 to 19 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.

RESOLUTION 1

The directors are required to present to the meeting the audited accounts and the reports of the directors and the auditor for the financial year ended 31 October 2021.

The annual report and accounts can be accessed on the Company's website (www.chemring.com) or shareholders may obtain a copy by contacting the Company Secretary at the Company's registered office during usual business hours.

RESOLUTIONS 2 AND 3

In accordance with the provisions of the Companies Act 2006 (the "Act"), the directors' remuneration report in the 2021 annual report and accounts contains:

• a statement by Laurie Bowen, the Chairman of the Remuneration Committee;
• the directors' remuneration policy in relation to future payments to current and former directors; and
• the annual implementation report on directors' remuneration, which details payments made to directors during the year ended 31 October 2021.

The directors' remuneration policy is subject to a binding vote by shareholders at least every three years. The policy is set out on pages 97 to 107 of the directors' remuneration report in the 2021 annual report and accounts, and an explanation of the changes from the policy approved by shareholders at the 2019 Annual General Meeting is set out on pages 94 to 96. Shareholders will have a binding vote on this resolution. If resolution 2 is passed, the policy will become binding immediately after the Annual General Meeting on 3 March 2022. Thereafter, the Company will not be able to make any remuneration payment to a current or prospective director or a payment for loss of office to a current or former director, unless that payment is consistent with the policy or has been approved by a shareholder resolution.

If the directors' remuneration policy is approved and remains unchanged, it will be valid for up to three years without new shareholder approval unless the annual implementation report on directors' remuneration (excluding the remuneration policy) is not approved by shareholders when put to an ordinary resolution prior to the expiry of the three-year period. If the policy is not approved for any reason, the Company will,

if and to the extent permitted by the Act, continue to make payments to directors in accordance with the existing policy and will seek shareholder approval for a further revised policy as soon as is practicable.

Resolution 3 is the ordinary resolution to approve the annual implementation report on directors' remuneration, other than the part containing the directors' remuneration policy. This resolution is an advisory vote and does not affect the future remuneration paid to any director.

RESOLUTION 4

Shareholders must approve the final dividend payable for each ordinary share held. The final dividend declared cannot exceed the amount recommended by the directors. If approved, the dividend will be paid on 31 March 2022 to shareholders on the register at the close of business on 11 March 2022.

RESOLUTIONS 5 TO 12

In accordance with the Company's articles of association, all directors are required to submit themselves for election or re-election at every annual general meeting. Biographical information relating to each of the directors seeking re-election is set out on page 6 of this notice.

The Board considers that each director of the Company who is proposed for re-election has appropriate and relevant skills, experience and knowledge to enable them to continue to discharge the duties and responsibilities of a director of the Company effectively. The Chairman of the Board considers that each of these individuals continues to demonstrate commitment to their role and to make an effective and valuable contribution to the Board.

RESOLUTIONS 13 AND 14

These resolutions propose the reappointment of KPMG as auditor, and authorise the directors, in accordance with standard practice, to agree the remuneration to be paid to the auditor.

KPMG was appointed as auditor in March 2018 to replace Deloitte, which had been the external auditor for a number of years. The Audit Committee unanimously recommends the reappointment of KPMG.

RESOLUTION 15

The directors of the Company may only allot shares if authorised to do so by the shareholders in general meeting. This resolution, if passed, will grant new authority under section 551 of the Act and will give the directors flexibility to act in the best interests of shareholders, when opportunities arise, by issuing new ordinary shares. Paragraph (A) of the resolution authorises the directors to allot ordinary shares, and grant rights to subscribe for, or convert any security into, shares, up to an aggregate nominal amount of £943,835, which represents approximately one-third of the issued ordinary share capital of the Company as at

10 January 2022 (being the latest practicable date prior to the publication of this notice). Paragraph (B) of the resolution authorises the directors to allot, including the shares referred to in paragraph (A) of the resolution, further of the Company's shares, and grant rights to subscribe for, or convert any security into, shares, up to an aggregate nominal amount

of £1,887,670 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 limit is in line with the latest guidelines issued by the Investment Association.

The directors have no present intention of exercising this authority except for the purpose of allotting shares under the terms of the Company's employee share schemes. The authority will expire at the conclusion of the next annual general meeting or on 3 June 2023 (whichever is the earlier).

The Company does not currently hold any ordinary shares in treasury.

4 Chemring Group PLC Notice of Annual General Meeting 2022

RESOLUTIONS 16 AND 17

If the directors wish to allot shares, or grant rights to subscribe for, or convert securities into, shares, or sell treasury shares for cash (other than pursuant to an employee share scheme), they must first offer them to existing shareholders in proportion to their holdings. There may be occasions when the directors need the flexibility to finance business opportunities by allotting shares without a pre-emptive offer to existing shareholders, and this can be done if the shareholders have first given a limited waiver of their pre-emption rights.

Resolution 16 and resolution 17 ask shareholders to grant this limited waiver. The resolutions will be proposed as special resolutions.

Resolution 16 contains a two-part waiver. The first is limited to the allotment of shares for cash up to an aggregate nominal value of £141,575 (which includes the sale on a non-pre-emptive basis of any shares held in treasury), which represents approximately 5 per cent of the issued ordinary share capital of the Company as at 10 January 2022 (being the latest practicable date prior to the publication of this notice), without having to first offer them to shareholders in proportion to their existing holdings. The second is limited to the allotment of shares for cash in connection with a rights issue, to allow the directors to make appropriate exclusions and other arrangements to resolve legal or practical problems which, for example, might arise in relation to overseas shareholders.

The waiver granted by resolution 17 is in addition to the waiver granted by resolution 16. It is limited to the allotment of shares for cash up to an aggregate nominal value of £141,575 (which includes the sale on a non-pre-emptive basis of any shares held in treasury), which represents approximately 5 per cent of the issued ordinary share capital of the Company as at 10 January 2022 (being the latest practicable date prior to the publication of this notice), without having to first offer them to shareholders in proportion to their existing holdings. This further waiver may only be used for an allotment of shares for cash for the purposes of financing (or refinancing, if the waiver is used within six months of the original transaction) a transaction which the directors determine to be an acquisition or other capital investment of a kind contemplated by the Pre-emption Group's March 2015 Statement of Principles.

The authority will expire at the conclusion of the next annual general meeting or on 3 June 2023 (whichever is the earlier). It is the directors' intention to review this authority every year. There are no present plans to exercise this authority.

RESOLUTION 18

If passed, this resolution will give the Company authority to purchase its own shares in the market up to a limit of 10 per cent of the Company's issued ordinary share capital. The maximum and minimum prices are stated in the resolution. The directors believe that it is advantageous for the Company to have this flexibility to make market purchases of its own shares. In the event that shares are purchased, they will either be cancelled (and the number of shares in issue will be reduced accordingly) or retained as treasury shares, as an alternative to cancelling them.

Shares repurchased as treasury shares will be held with a view to possible resale at a future date, rather than having to cancel them. This gives the Company the ability to reissue treasury shares quickly and cost effectively, and provides the Company with additional flexibility in the management of its capital base. Any issues of treasury shares for the purposes of the Company's employee share schemes will be made within the 10 per cent anti-dilution limit set by the Investment Association.

The directors have no present intention of making such purchases and will only exercise this authority if they are satisfied that a purchase can be expected to result in an increase in earnings per share and will be in the interests of shareholders generally. The authority will expire at the conclusion of the next annual general meeting or on 3 June 2023 (whichever is the earlier).

As at 10 January 2022, there were options over 1,757,703 ordinary shares in the capital of the Company which represents 0.62 per cent of the issued ordinary share capital at that date. If the authority to purchase ordinary shares was exercised in full, these options would represent 0.69 per cent of the issued ordinary share capital.

RESOLUTION 19

The Act provides that general meetings of a company may be held on not less than fourteen clear days' notice in writing. However, the Shareholder Rights Directive (Directive 2007/36/EC), which came into force on

1 August 2009, made it a requirement for a company whose shares are traded on the London Stock Exchange (among other markets), to seek approval each year from its shareholders if any general meeting is to be held on less than twenty one days' notice in writing. Resolution 19 seeks such approval. It will only be effective until the conclusion of the next annual general meeting, when the Company may propose a similar resolution. It is intended that the shorter notice period would not be used as a matter of routine for such meetings but only where the flexibility is merited by the business of the meeting and is thought to be in the interests of shareholders as a whole.

Chemring Group PLC Notice of Annual General Meeting 2022

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