AGM Presentation (Chris)_v8.key

XERO LIMITED - ANNUAL MEETING
WEDNESDAY 22 JULY 2015
Chairman’s introduction
Welcome
Good afternoon and welcome to Xero’s Annual Meeting for 2015. I’m pleased to be speaking on
behalf of the Board, as Chairman, for my second Xero Annual Meeting.
To begin, I’ll introduce our Board to you.
On my right is Rod Drury, Xero’s Chief Executive and Co-founder. Rod will present to us shortly.
Next to Rod, are non-executive Directors: Craig Winkler, Craig Elliott, and Sam Morgan. To my left
are non-executive Directors Lee Hatton, Graham Smith, and Graham Shaw. On the end we have
Matt Vaughan, Xero’s Company Secretary.
Unfortunately, Bill Veghte wasn’t able to make it today – he sends his apologies.
I’d like to first note some positive developments about the Board in recent months. Lee Hatton was
appointed CEO of UBank earlier this year, and Bill Veghte was appointed CEO of SurveyMonkey
last month. It’s great to have two such high calibre board members recognised for their leadership.
As well as that, we have a new Board member in Graham Smith, who has a wealth of experience
in international markets, most recently as CFO of the largest SaaS company in the world,
Salesforce.com
Before we start with the formal business of the meeting, I have a couple of housekeeping points.
I’d be grateful if you could please make sure your phone is switched off or on silent. And, in the
event of an emergency please make your way to the door you came through and follow the
instructions of the Te Papa staff.
We’ll begin today with the formal business and resolutions of the meeting, which will be followed by
presentations from our CEO, Rod Drury, from the Managing Directors of each of our U.S., New
Zealand, and Australian operations, and from our Chief Marketing Officer, Andy Lark. Rod and the
team will take you through what has been another strong year for Xero, and will talk about some of
the exciting opportunities that lay ahead.
I’d like to point out that Rod will be stating, in his presentation, that while it’s early in our financial
year, we are expecting subscription revenue for the full year to 31 March 2016 to exceed
NZ$200m, based on June 2015 FX rates. I’d also note that while we still intend to list on a US
stock exchange, timing is dependent on internal and external factors and won’t be prior to the
release of our 2016 financial year results.
There will be opportunities for shareholders to ask specific questions as we address each
resolution in the formal part of the meeting, and there will be general opportunities for shareholders
to ask questions following Rod’s presentation. With that said, as Chair of the meeting, I declare
Xero’s 2015 Annual Meeting formally open.
Before we move to the resolutions to be considered today, I’d like to acknowledge Graham Shaw.
Graham will be retiring by rotation at this meeting but will not be standing for re-election.
Graham joined Xero’s Board in 2006, shortly after Xero’s incorporation and prior to its listing on the
NZX in 2007. He has been instrumental over the last 9 or so years bringing Xero to the global
stage, from a handful of employees in an apartment back in 2006 to over 1200 employees across
20 offices today. Graham’s contribution to Xero, both as a Board member and Chair of our Audit
and Risk Management Committee, has been immense.
On behalf of the Board, we are extremely grateful for Graham’s contribution and wish him all the
best in his future endeavours.
I’d now like to invite Graham to say a few words.
[Graham to speak]
Thank you Graham.
I will now move to the formal business of the meeting.
[Refer to slides below for the resolutions proposed at the Annual Meeting]
Annual meeting
1
Chris Liddell
Chairman of the Board
2
Graham Shaw
3
Resolutions
4
Resolution 1 - Fixing the Remuneration of the Auditor
That the Board is authorised to fix
the remuneration of the auditor.
Proxies:
FOR
AGAINST
DISCRETIONARY
52,617,708 (99.830%)
2,155 (0.004%)
87,374 (0.166%)
5
Resolution 2 - Election of Graham Smith as a Director
That Graham Smith, appointed by the
Board as an additional Director on 25
February 2015, be elected as a Director
of Xero Limited.
Proxies:
FOR
AGAINST
DISCRETIONARY
52,595,788 (99.75%)
43,261 (0.08%)
89,624 (0.17%)
6
Resolution 3 - Re-election of Craig Elliott as a Director
That Craig Elliott, retiring from
office as a Director of Xero
Limited by rotation, be re-elected
as a Director of Xero Limited.
Proxies:
FOR
AGAINST
DISCRETIONARY
52,607,921 (99.778%)
29,766 (0.056%)
87,474 (0.166%)
Resolution 4 - Re-election of Craig Winkler as a Director
That Craig Winkler, retiring from
office as a Director of Xero Limited
by rotation, be re-elected as a
Director of Xero Limited.
Proxies:
FOR
AGAINST
DISCRETIONARY
52,480,525 (99.557%)
145,944 (0.277%)
87,584 (0.166%)
Resolution 5 - Approval of the 2016 Options to be granted to
Chris Liddell and Bill Veghte
That the grant of options to subscribe for ordinary shares in Xero Limited to Chris
Liddell and Bill Veghte, as remuneration for their roles as Directors of Xero
Limited (equating to an annual value of NZ$220,000 and NZ$176,000
respectively), in or around February 2016, on the terms set out in the Explanatory
Notes to the Notice of Meeting (i.e., on substantively the same terms as the grant
of options to Chris and Bill in February 2015, which was approved at Xero’s 2014
Annual Meeting), be approved, and that the issue of ordinary shares in Xero
Limited to Chris and Bill upon any exercise of those options, be approved.
Proxies:
FOR
AGAINST
DISCRETIONARY
46,713,384 (88.60%)
5,921,155 (11.23%)
87,911 (0.17%)
9
Resolution 6 - Approval of the issue of Ordinary Shares to Lee
Hatton
That the issue of ordinary shares in Xero Limited to Lee
Hatton in lieu of cash, as remuneration for her role as a
Director of Xero Limited to a value of NZ$70,000 per
annum on the terms set out in the Explanatory Notes to
the Notice of Meeting, be approved.
Proxies:
FOR
AGAINST
DISCRETIONARY
52,538,380 (99.646%)
98,407 (0.187%)
88,011 (0.167%)
Resolution 7 - Amendment to the U.S. Scheme
That the Xero Limited (USA) Equity Incentive Scheme be amended to allow for a
total of 4.4m equity securities (whether options to subscribe for ordinary shares or
restricted stock units or a combination of both) to be allocated pursuant to the
U.S. Scheme (the U.S. Equity Scheme Cap), subject to the following resolution and
any adjustments made in accordance with the U.S. Scheme’s provisions for certain
changes in Xero Limited’s capitalisation.
Proxies:
FOR
AGAINST
DISCRETIONARY
52,574,097 (99.72%)
57,596 (0.11%)
90,276 (0.17%)
11
Resolution 8 - Amendment to the U.S. Scheme
That, in calculating the number of equity securities allocated for the purpose of
the U.S. Equity Scheme Cap (as defined in resolution 7), any equity securities that:
(a) are allocated pursuant to the U.S. Scheme after the date of this resolution, and
(b) up to 1,505,440 equity securities that were allocated pursuant to the U.S.
Scheme prior to the date of this resolution; but that have, in each case, prior to
exercise or vesting, as applicable, been forfeited or cancelled (including if
forfeited or cancelled in connection with any tax withholding upon vesting of
restricted stock units), are not to be counted in such calculation.
Proxies:
FOR
AGAINST
DISCRETIONARY
52,591,452 (99.72%)
59,361 (0.11%)
90,292 (0.17%)
12