Clarification issued on proxy advisory firms' voting recommendations for postal ballot resolutions

The company has responded to voting advisories from IiAS and ISS on its Postal Ballot Notice dated 2 September 2026 (e-voting open till 9 October 2026, 5 PM).

Wed 30 Sep 2026

RSU Plan 2026 Cap

2,000,000 RSUs, about 0.33% of paid-up capital

ESOP 2024 Pool Increase

17,500,000 options to 41,816,400 (~2.9% of capital)

Trust Secondary Purchase Limits

0.5% per financial year, 1% aggregate vs SEBI's 2% and 5%

E-voting Period

10 September 2026 to 5:00 PM IST on 9 October 2026

What was shared

Hexaware has placed on record its clarification on the voting recommendations issued by Institutional Investor Advisory Services India Limited (IiAS) and Institutional Shareholder Services India Private Limited (ISS) regarding resolutions in the Postal Ballot Notice dated 2 September 2026. Remote e-voting runs from 10 September 2026 to 5:00 PM IST on 9 October 2026. The company has asked IiAS to consider its responses and, where appropriate, revise its recommendations before voting closes.

Company's overall position

• None of the eight items in the Notice involves commitment of any cash cost; share-based plans are expensed at fair value under Ind AS 102 and are described as net-worth neutral.
• The payment referred to in Item 8 is made by promoter group entity CA Sebright Investments from its own resources.
• Dilution from Items 1 to 5 is stated at about 0.33% of paid-up capital, spread over several years, and can reduce to nil if the Trust buys shares from the market.
• Plans are administered by the Nomination and Remuneration Committee, chaired by an independent director with two-thirds independent directors.
• The company says the advisory does not identify contraventions of law and that objections reflect IiAS's own voting guidelines.
• The proposals are linked to a planned CEO transition and retention of leadership, engineering, AI and client-facing talent.

Item-wise highlights

• RSU Plan 2026 (trust route): exercise price at face value, vesting largely time-based; capped at 2,000,000 RSUs. Committee intends to attach performance conditions for grants to eligible employees.
• Extension to subsidiary/group employees: about 15 % + of employees are outside India and about 95 % + of CY2025 revenue came from clients outside India. Grants come from the same 2,000,000 RSU pool, so no incremental dilution.
• Employees Benefit Trust: constituted in 2024 for ESOP 2024 and being renamed to serve both plans; trustees are senior employees, not directors, KMP or promoters; the Trust does not vote its shares.
• Secondary acquisition by Trust: limits of 0.5% of paid-up capital per financial year and 1% in aggregate, against SEBI ceilings of 2% per year and 5% aggregate.
• Money provided to Trust: capped at the statutory ceiling of 5% of paid-up capital and free reserves; loan is interest-free and repayable from exercise proceeds. Company states it has no borrowings and a consolidated net worth of about Rs 63 billion as at 31st December 2025.

ESOP 2024 amendment details

• Pool increase of 17,500,000 options taking the total to 41,816,400, stated as about 2.9% of paid-up capital, to be granted over several years.
• ESOP 2024 was approved in May 2024 with a pool of 24.3 million options; 21.5 million options were granted in 2024 to 1200 + employees before the IPO, with 20.8 million outstanding as of 31 December 2024 (headroom about 4.2 million).
• As of 31 December 2025, 18.6 million options were outstanding and 1.56 million shares had been allotted on exercise, leaving headroom of about 4.1 million options before 2026 grants.
• Past grants carried exercise prices ranging from Rs 382.50 to Rs 430 per share; pricing provisions are unchanged and future exercise prices will be set by the Committee with reference to market price.
• IiAS also noted the exercise period extension from three to six years and an acceleration provision.

How investors may read it

Proxy advisory firms issuing adverse or qualified recommendations can influence institutional voting on the postal ballot. The company's clarification sets out its rationale on dilution, cost and governance. The outcome will be known when postal ballot results are declared after e-voting closes.

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