Liontrust Asset Management : Directors’ remuneration policy and Liontrust long term incentive plan - Notice of General Meeting

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If you are in any doubt as to any aspect of the proposals referred to in this document or as to the action you should take, you should seek your own advice from a stockbroker, solicitor, accountant, or other professional adviser authorised under the Financial Services and Markets Act 2000.

If you have sold or otherwise transferred all of your ordinary shares in Liontrust Asset Management Plc (the "Company"), please pass this document together with the accompanying documents 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.

Liontrust Asset Management Plc

(incorporated and registered in England and Wales under number 2954692)

DIRECTORS' REMUNERATION POLICY

AND

LIONTRUST LONG TERM INCENTIVE PLAN

NOTICE OF GENERAL MEETING

Notice of the general meeting of the Company to be held at 10.00 a.m. on Wednesday 16 February 2022 in the Pinafore room at the Savoy Hotel, Strand, London, WC2R 0EZ is set out in Part IV of this document.

Please note a proxy form is not included with the Notice of GM. Please see the notes to the Notice of GM for further details on how to vote. Shareholders can appoint proxies electronically via www.signalshares.com to be received by our registrars, Link Group, by no later than 10.00 a.m. on Monday 14 February 2022. CREST members can also appoint proxies by using the CREST electronic proxy appointment service and transmitting a CREST Proxy Instruction in accordance with the procedures set out in the CREST Manual so that it is received by Link Group (under CREST participant RA10) by no later than 10.00 a.m. on Monday 14 February 2022. The time of receipt will be taken to be the time from which Link Group is able to retrieve the message by enquiry to CREST in the manner prescribed by CREST.

Should a hard copy form of proxy be required this can be requested directly from the registrars, Link Group, as set out in the notes of the Notice.

CONTENTS
PAGE
Expected Timetable of Principal Events	2
Part I	Letter from the Chair of the Remuneration Committee of the
	Board of Directors of Liontrust Asset Management Plc	3
Part II	Summary of the principal features of the Liontrust Long Term Incentive Plan	10
Part III	Directors' Remuneration Policy	14
Part IV	Notice of General Meeting	26

EXPECTED TIMETABLE OF PRINCIPAL EVENTS

Latest time and date for receipt of Forms of Proxy for the

General Meeting	10.00 a.m. on 14 February 2022
Date and time of General Meeting	10.00 a.m. on 16 February 2022
Note:

All references to times in this document are to London times.

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PART I

LETTER FROM THE CHAIR OF THE REMUNERATION COMMITTEE OF THE BOARD OF DIRECTORS OF LIONTRUST ASSET MANAGEMENT PLC

Liontrust Asset Management Plc

(incorporated and registered in England and Wales under number 2954692)

Registered Office:

2 Savoy Court, London WC2R 0EZ

Directors:

Alastair Barbour (Non-executive Chairman)

John Ions (Chief Executive)

Vinay Abrol (Chief Financial Officer and Chief Operating Officer)

Mandy Donald (Non-executive Director)

Emma Howard Boyd CBE (Non-executive Director)

Quintin Price (Non-executive Director)

Rebecca Shelley (Non-executive Director)

George Yeandle (Non-executive Director)

28 January 2022

Notice of General Meeting

Dear Shareholder,

I am pleased to be writing to you to provide details of a general meeting of the Company (the "General Meeting" or "GM""). The GM relates to the proposed changes to the Directors' remuneration policy (the "Policy" or "DRP") and approval of the new Liontrust Long Term Incentive Plan ("LTIP"), which we are holding at 10.00 a.m. on Wednesday 16 February 2022 in the Pinafore Room at The Savoy Hotel, Strand, London, WC2R 0EZ. The formal notice of the GM is set out in Part IV of this document.

The current Policy was approved by shareholders in 2018 and, by way of context, I have set out below how the business has performed over the last three financial years (FY2019 to FY2021), highlighting the growth in some key financial and strategic metrics:

Growth over FY2019 to FY2021	Cumulative return	Annualised return
Share price	156%	37%
Dividends	124%	31%
Assets under Management and Advice	194%	43%
Adjusted PBT	135%	33%
Adjusted Diluted EPS	105%	27%
Net flows	248%	52%

Having become Chair of the Remuneration Committee (the "Committee") in 2015, following the successful turnaround phase in the Company's development, we produced a remuneration policy to support the growth strategy of the business. In short, this was to keep the cost of any Executive Director base remuneration low, to gear reward to performance linked to the delivery of our strategy and with an increased emphasis on moving pay towards longer term equity incentives (the "LTIP") subject to performance conditions.

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Our business strategy over the last few years has been to focus on organic growth and, where there are gaps in our capability, to hire/acquire fund management teams and/or acquire fund management businesses. The success of this business strategy is shown by Assets under Management and Advice ("AuMA") reaching £30.9 billion on 31 March 2021, an increase of 92% compared to the year before, and increasing further to £37.2 billion on 31 December 2021. During the current financial year Liontrust has won the following awards:

1. Asset Manager of the Year awarded by Financial News Asset Management Awards 2021;
2. Best Fund Group awarded by Shares Awards 2021; and
3. Global Group of the Year awarded by Investment Week Fund Manager of the Year Awards 2021,

and in 2021 was named as the 8th best asset management brand in the UK (source: Broadridge's Annual Survey).

Over the last five years, the Company has acquired three businesses: Alliance Trust Investments Limited ("ATI"), Neptune Investment Management Limited ("Neptune") and the Architas UK Investment Business ("Architas"). The success is shown by how each of these businesses have performed in terms of AuMA growth and net fund flows since they were acquired.

Since acquiring ATI in 2017, the AuMA has risen from £2.5 billion to £14.6 billion as at the end of December 2021, an increase of 479%. Neptune (acquired in 2019) and Architas (acquired in 2020) have both seen their AuMA increase by 18% and 12% respectively. The Executive Directors have driven integration of these businesses with Liontrust both by leveraging our brand and distribution and by ruthless integration into our Front and Back-office divisions.

Liontrust has also recently announced the agreement to acquire Majedie Asset Management Limited. The Majedie Fund Management Team has vast experience of, and a long-term pedigree in, institutional fund management. The proposed acquisition will significantly boost Liontrust's existing institutional proposition, allowing Liontrust to accelerate growth in this key segment of the market through increasing scale, our distribution and client base. Liontrust's pro forma AuMA will increase by £5.8 billion (Majedie AuMA as at 30 November 2021) to over £43 billion following completion of the acquisition.

I have set out below an extract from the Remuneration Report for the financial year ended 31 March 2021 which I am delighted to say shows a very strong link between Executive Directors' pay and performance through the execution of our old Policy.

Proposed new Policy to support the next phase of Transformation for the Company

Since September 2018, when the current Policy was approved, the market capitalisation of the Company has increased from £325 million to £1.35 billion (as at 31 December 2021). The Company joined the FTSE 250 index in June 2020 and is now ranked 135th in terms of its index weighting (as at 31 December 2021).

Following detailed deliberations, the Committee has focused on developing a new Policy fit for purpose for the next 5 years. It aims to incentivise the Executive team to continue to execute its proven strategy and drive growth both organically and through acquisitions. This will transform the business in terms of AuMA, fund choice and processes, distribution channels and financial

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performance, all of which will ultimately flow through to a significant Long Term Incentive for shareholders over the next 5 years (the "Transformation"). To help achieve this, the new Policy has the following guiding principles:

• Remuneration should help retain and continue to motivate a truly exceptional Executive team (as evidenced by corporate performance over the last 11 years - see below) and ensure they are proportionately rewarded for delivering significant value for shareholders over the next phase of the Company's development;

• Short-termremuneration should be appropriately balanced between fixed and variable elements. The Committee believes that the time is right to re-set the current mix (but with no overall increase) to bring salary levels to a more competitive position relative to the market and to introduce a more conventional annual bonus structure (capped with a robust short-term performance scorecard focused on financial, operational and ESG metrics); and
• Long-termincentives should be aligned with the Transformation through the introduction of a new equity-based plan which provides the Executive Directors with the opportunity to earn a fixed number of Liontrust shares over the three- year life of the policy if management continues to execute successfully the business strategy and drive exceptional returns to shareholders.

Our proposed Policy is summarised here.

Fixed Pay

The current salaries of £348k and £328k are 63% and 87% of the median pay of the FTSE 250 Financial Services ("FS") companies for the Chief Executive and CFO/COO respectively. The Executive Directors' salary levels have only one increase of 5% since 2015, yet the wider workforce has typically received this level of increase on an annual basis (for strong performers). The Committee reflected on whether to implement the changes over a phased period but, on balance, concluded that this did not have the desired effect of 'rebasing' after a period of, in effect, six years with no base pay increases.

The Committee believes it is appropriate to bring the Executive Directors' base pay up to the market norm and are proposing to position this around the market median. In spite of their proven track record and potential attractiveness to others, we still believe in gearing reward to performance and, in particular, towards long-term equity awards which are subject to stringent performance conditions. This will ensure the Executive Directors are compensated appropriately compared with their peers given they operate in the same talent pool. Base salaries are proposed to increase to £550,000 for the Chief Executive and £420,000 for the CFO/COO.

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