Discoverie Group PLC — AGM Information 2014

Jun 29, 2014

This document is important and requires your immediate attention. If you are in any doubt as to what action you should take, you are recommended to seek your own independent advice from your stockbroker, solicitor, accountant or other professional adviser immediately. If you have sold or transferred all of your Acal plc ordinary shares, please forward this document, together with the accompanying documents, as soon as possible to the purchaser or transferee or to the agent through whom the sale or transfer was effected for delivery to the purchaser or transferee.

Annual General Meeting Tuesday 29 July 2014

Notice of Annual General Meeting and Chairman's explanatory letter

27 June 2014

Dear Shareholder

Annual General Meeting 2014

I have great pleasure in inviting you to the Annual General Meeting of Acal plc (the "Company") to be held at 2 Chancellor Court, Occam Road, Surrey Research Park, Guildford, Surrey GU2 7AH at 11.00am on Tuesday 29 July 2014.

You will find with this letter:

• The Notice of Meeting, setting out the resolutions to be proposed, together with explanatory notes.
• A copy of the Annual Report and Accounts of the Company for the year ended 31 March 2014, including the Annual Financial Statements and the Directors' Remuneration Report 2014.
• A Form of Proxy.

Recommendation

Your Directors believe that all the proposals to be considered at the Annual General Meeting are in the best interests of the Company and of its shareholders as a whole. They recommend that you vote in favour of these resolutions, as they intend to do in respect of their own beneficial holdings.

Action to be taken

You are requested to complete, sign and return the Form of Proxy, in accordance with the directions, as soon as possible and, in any event, so that it is received by 11.00am on Friday 25 July (or in the event of any adjournment, 48 hours (excluding non-working days) before the end of the adjourned meeting). Completion and return of the Form of Proxy will not prevent you from attending the Meeting and voting in person, should you wish to do so.

Should you have any questions please contact the Group Company Secretary at the address shown below.

Yours faithfully

R J Moon Chairman

Acal plc, 2 Chancellor Court, Occam Road, Surrey Research Park, Guildford GU2 7AH

Tel: +44(0)1483 544500

Registered office as above. Registered No: 2008246 England & Wales

Notice of Annual General Meeting

NOTICE IS HEREBY GIVEN THAT the Twenty Eighth Annual General Meeting of Acal plc (the "Company") will be held at the Company's offices, 2 Chancellor Court, Occam Road, Surrey Research Park, Guildford, Surrey, GU2 7AH on Tuesday 29 July 2014 at 11.00am to consider and, if thought fit, to pass the Resolutions set out below. Resolutions 1 to 11 will be proposed as Ordinary Resolutions while Resolutions 12 to 16 will be proposed as Special Resolutions.

Resolutions

• 1 To receive and adopt the Financial Statements for the year ended 31 March 2014, together with the Reports of the Directors and the Auditors thereon.
• 2 To approve the final dividend of 6.85 pence per ordinary share recommended by the Directors in respect of the year ended 31 March 2014, payable on 31 July 2014 to holders of ordinary shares registered at the close of business on 13 June 2014.
• 3 To approve the Directors' Remuneration Report as set out on pages 39 to 53 of the Annual Report and Accounts for the year ended 31 March 2014 (other than the part containing the Directors' Remuneration Policy).
• 4 To approve the Directors' Remuneration Policy, contained in the Directors' Remuneration Report, as set out on pages 48 to 53 of the Annual Report and Accounts for the year ended 31 March 2014.
• 5 To re-elect Simon Gibbins as a Director.
• 6 To re-elect Richard Moon as a Director.
• 7 To re-elect Graham Williams as a Director.
• 8 To re-appoint Ernst & Young LLP as Auditors of the Company to hold office from the conclusion of this Meeting until the conclusion of the next general meeting at which accounts are laid before the Company.
• 9 To authorise the Directors to determine the remuneration of the Auditors.
• 10 That, in substitution for all existing unexercised authorities, the authority conferred on the Directors by Article 7.2 of the Company's Articles of Association be renewed (unless previously renewed, varied or revoked) for a period ending on the earlier of the date of the Company's next Annual General Meeting or 28 October 2015 and, for that period, the Section 551 Amount is £1,044,299.
• 11 That, in addition and without prejudice to the authority renewed in Resolution 10 above, the Directors be and are hereby generally and unconditionally authorised to exercise all the powers of the Company to allot or grant rights to subscribe for or to convert any security into shares in the Company in connection with a rights issue by the Company of ordinary shares up to an aggregate nominal amount of £1,044,299 provided that this authority shall expire on the earlier of the date of the Company's next Annual General Meeting or 28 October 2015 save that the Company may before such expiry make an offer or agreement which would or might require shares to be allotted or rights to be granted after such expiry and the Board may allot shares or grant such rights in pursuance of those offers or agreements as if this authority had not expired.

For the purpose of this Resolution a "rights issue" means an offer to:

• (a) ordinary shareholders in proportion (as may be practicable) to their existing holdings; and
• (b) 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,

to subscribe for further securities by means of the issue of a renounceable letter (or other negotiable document) which may be traded for a period before payment for the securities is due, but subject to such exclusions or other arrangements as the Directors may deem necessary or expedient in relation to treasury shares, fractional entitlements, record dates or legal, regulatory or practical problems in, or under the laws of, any territory.

• 12 That, in substitution for all existing authorities, the authority conferred on the Directors by Article 7.3 of the Company's Articles of Association be renewed (unless previously renewed, varied or revoked) for a period ending on the earlier of the date of the Company's next Annual General Meeting or on 28 October 2015 and, for that period, the Section 561 Amount is £156,660.

• 13 That, subject to the passing of Resolution 11 above, the Directors be and are hereby empowered pursuant to Section 570 of the Companies Act 2006 to allot equity securities (within the meaning of Section 560 of the said Act) for cash pursuant to the authority conferred by Resolution 11 above as if sub-section (1) of Section 561 of the said Act did not apply to any such allotment provided that this power shall expire on the earlier of the date of the Company's next Annual General Meeting or 28 October 2015 save that the Company may before such expiry make an offer or agreement which would or might require equity securities to be allotted after such expiry and the Board may allot equity securities in pursuance of such an offer or agreement as if the power conferred hereby had not expired.

• 14 That, subject to the provisos hereto, the Company be and is hereby generally authorised to purchase any of its own ordinary shares of five pence each by a market purchase (as defined by Section 693(4) of the Companies Act 2006) provided always that this power shall:

• (a) be limited to a purchase or purchases up to an aggregate of 6,266,425 issued ordinary shares of five pence each of the Company, representing approximately 10% per cent. of the Company's issued share capital, taking into account the increase of the Company's issued share capital as a result of the rights issue announced by the Company on 5 June 2014 (the "Rights Issue").
• (b) be limited to a purchase or purchases at a price per ordinary share (exclusive of dealing and other incidental costs and stamp duty) not below five pence and not above an amount equal to the higher of: (i) 105 per cent. of the average of the middle market quotations for an ordinary share as derived from the London Stock Exchange Daily Official List for the five business days immediately preceding the day on which the ordinary share is contracted to be purchased; and (ii) that stipulated by Article 5(1) of the Buy-back and Stabilisation Regulation 2003 (EC 2273/2003); and
• (c) unless renewed, varied or revoked by the Company in general meeting expire on the earlier of the date of the Company's next Annual General Meeting or 28 October 2015 and the Company may make a purchase of its own shares in accordance with this authority after the expiry of the said time limit imposed above where the contract of purchase is concluded before such authority expires and the Company is hereby permitted to make a contract of purchase which would or might be executed wholly or partly after the authority shall have expired.
• 15 That a general meeting other than an Annual General Meeting may be called on not less than 14 clear days' notice.
• 16 That the Acal plc 2014 Unapproved Share Option Plan ("USOP"), the main features of which are summarised in Appendix 2 hereto, be approved and the Directors be authorised to do all acts and things, as they may consider necessary or desirable, to carry the USOP into effect and to establish further plans, based on the USOP but modified to take account of local tax, exchange control or securities laws, in overseas territories, provided that any shares made available under such further plans are treated as counting against the limits on individual or overall participation in the USOP.

By Order of the Board

Gary Shillinglaw

Group Company Secretary

Registered Office 2 Chancellor Court, Occam Road, Surrey Research Park, Guildford GU2 7AH

27 June 2014

Notes

• 1 A member of the Company entitled to attend, speak and vote at the Meeting convened by the Notice set out above may appoint a proxy to exercise all or any of his or her rights to attend, speak and vote at the Meeting on his/her behalf. A proxy need not be a member of the Company. A member may appoint more than one proxy provided that each proxy is appointed to exercise the rights attached to different shares held by the member. Details of how to appoint the Chairman of the AGM or another person as your proxy using the Form of Proxy are set out in the notes to the Form of Proxy.
• 2 To be valid, Forms of Proxy must be received by post or (during normal business hours only) by hand at the offices of the Company's registrars, Equiniti Limited, at Aspect House, Spencer Road, Lancing, West Sussex, BN99 6DA not later than 11.00am on Friday 25 July 2014 (or in the case of an adjournment, 48 hours (excluding non-working days) before the time fixed for holding the adjourned meeting), and must be accompanied by any power of attorney or other authority. The Form of Proxy for use at the Meeting is enclosed.
• 3 Completion and return of a Form of Proxy will not prevent a member from attending and voting in person should he or she wish to do so.
• 4 The right to appoint a proxy does not apply to persons whose shares are held on their behalf by another person and who have been nominated to receive communications from the Company in accordance with Section 146 of the Companies Act 2006 ("nominated persons"). Nominated persons may have a right under an agreement with the registered shareholder who holds the shares on their behalf to be appointed (or to have someone else appointed) as a proxy. Alternatively, if nominated persons do not have such a right, or do not wish to exercise it, they may have a right under such an agreement to give instructions to the person holding the shares as to the exercise of voting rights.
• 5 CREST members who wish to appoint a proxy or proxies through the CREST electronic proxy appointment service may do so for the Annual General Meeting to be held on Tuesday 29 July 2014 and any adjournment(s) thereof by using the procedures described in the CREST Manual at www.euroclear.com. CREST Personal Members or other CREST sponsored members, and those CREST members who have appointed a voting service provider(s), should refer to their CREST sponsor or voting service provider(s), who will be able to take the appropriate action on their behalf.
• 6 In order for a proxy appointment or instruction made using the CREST service to be valid, the appropriate CREST message (a "CREST Proxy Instruction") must be properly authenticated in accordance with Euroclear's specifications and must contain the information required for such instructions, as described in the CREST Manual. The message, regardless of whether it constitutes the appointment of a proxy or an amendment to the instruction given to a previously appointed proxy must, in order to be valid, be transmitted so as to be received by the issuer's agent (ID RA19) no later than 11.00am on Friday 25 July 2014 (or in the case of an adjourned meeting, not less than 48 hours (excluding non-working days) before the time of the adjourned meeting). For this purpose, the time of receipt will be taken to be the time (as determined by the timestamp applied to the message by the CREST Applications Host) from which the issuer's agent is able to retrieve the message by enquiry to CREST in the manner prescribed by CREST. After this time any change of instructions to proxies appointed through CREST should be communicated to the appointee through other means.
• 7 CREST members and, where applicable, their CREST sponsors or voting service providers should note that Euroclear does not make available special procedures in CREST for any particular messages. Normal system timings and limitations will apply therefore in relation to the input of CREST Proxy Instructions. It is the responsibility of the CREST member concerned to take (or, if the CREST member is a CREST Personal Member or sponsored member or has appointed a voting service provider(s), to procure that his/her CREST sponsor or voting service provider(s) take(s)) such action as shall be necessary to ensure that a message is transmitted by means of the CREST system by any particular time. In this connection, CREST members and, where applicable, their CREST sponsors or voting service providers are referred, in particular, to those sections of the CREST Manual concerning practical limitations of the CREST system and timings.
• 8 The Company may treat as invalid a CREST Proxy Instruction in the circumstances set out in Regulation 35(5)(a) of the Uncertificated Securities Regulations 2001.
• 9 To be entitled to attend and vote at the Meeting or any adjournment thereof, and for the purposes of determining how many votes the member may cast, members must be entered in the Company's register of members at 6.00pm on Friday 25 July 2014 (or, in the event of any adjournment, exluding any part of a day that is not a working day, 6.00pm on the date which is two days before the time of the adjourned meeting). Changes to entries in the register of members after that time are disregarded in determining the rights of any person to attend and vote at the Meeting.
• 10 Pursuant to DTR 6.1.12 R (2) of the Disclosure and Transparency Rules as at 27 June (being the last business day prior to the publication of this Notice), the Company had in issue 31,332,127 ordinary shares carrying one vote each. Therefore, the total voting rights in the Company as at 27 June 2014 are 31,332,127. However, for the purposes of resolutions 10, 11, 12, 13 and 14 the nominal amounts and corresponding numbers of ordinary shares have been calculated having regard to the additional shares issued by the Company pursuant to the Rights Issue.

Notes

• 11 Pursuant to Regulation 41(1) of the Uncertificated Securities Regulations 2001 (S.I. 2001/3755), the Company specifies that only those Shareholders who are registered on the Company's share register (the "Register") at 6.00pm on Friday 25 July 2014 (the "Specified Time") shall be entitled to attend or vote at the Meeting in respect of the ordinary shares in the capital of the Company registered in their names at that time.
• 12 Any corporation which is a member can appoint one or more corporate representatives who may exercise on its behalf all of its powers as a member provided that they do not do so in relation to the same shares. In the case of joint holders, only the appointment submitted by the most senior holder will be accepted. Seniority is determined by the order in which the names of the joint holders appear in the Company's register of members in respect of the joint holding (the first-named being the most senior).
• 13 Copies of all service contracts between the Directors and the Company, and the terms and conditions of appointment of Non-Executive Directors, may be inspected during business hours at the Company's registered office on a weekday (public holidays excluded) until the time of the Meeting and at 2 Chancellor Court, Occam Road, Surrey Research Park, Guildford, Surrey GU2 7AH from 15 minutes before the Meeting until the end of the Meeting.
• 14 Members who wish to communicate with the Company in relation to the Meeting should do so using the following means: (i) by writing to the Group Company Secretary at the registered office address or (ii) by writing to the Company's registrars, Equiniti Limited, at Aspect House, Spencer Road, Lancing, West Sussex, BN99 6DA. No other methods of communication will be accepted. In particular you may not use any electronic address provided either in this Notice of Annual General Meeting or in any related documents to communicate with the Company for any purposes other than those expressly stated.
• 15 Under Section 527 of the Companies Act 2006, shareholders meeting the threshold requirements set out in that Section have the right to require the Company to publish on a website a statement setting out any matter relating to: (i) the audit of the Company's accounts (including the auditor's report and the conduct of the audit) that are to be laid before the Annual General Meeting; or (ii) any circumstance connected with an auditor of the Company ceasing to hold office since the previous meeting at which Annual Accounts and Reports were laid in accordance with Section 437 of the Companies Act 2006. The Company may not require the shareholders requesting any such website publication to pay its expenses in complying with Sections 527 or 528 of the Companies Act 2006. Where the Company is required to place a statement on a website under Section 527 of the Companies Act 2006, it must forward the statement to the Company's auditor not later than the time when it makes the statement available on the website. The business which may be dealt with at the Annual General Meeting includes any statement that the Company has been required under Section 527 of the Companies Act 2006 to publish on a website.
• 16 Any shareholder attending the Meeting has the right to ask questions. The Company must cause to be answered any such question relating to the business being dealt with at the Meeting but no such answer need be given if (a) to do so would interfere unduly with the preparation for the Meeting or involve the disclosure of confidential information, (b) the answer has already been given on a website in the form of an answer to a question, or (c) it is undesirable, in the interests of the Company or the good order of the Meeting, that the question be answered.
• 17 A copy of the proposed new Acal plc 2014 Unapproved Share Option Plan, initialled by the Chairman for the purposes of identification, will be available for inspection:
• a) at the Meeting venue, on 29 July 2014, prior to and during the Meeting; and
• b) at the offices of MM&K Limited, No. 1, Bengal Court, Birchin Lane, London, EC3V 9DD from the date of this Notice until the close of the Meeting.
• 18 A copy of this Notice, and other information required by Section 311A of the Companies Act 2006, can be found at www.acalplc.co.uk. The results of the Meeting will be announced to the London Stock Exchange as soon as practicable following the Meeting, and will be published on the Company's website, as above.

Explanatory notes

Resolution 1: accounts

In accordance with the Companies Act 2006 (the "Act"), the Directors must present to the Meeting the Financial Statements of Acal plc (the "Company") for the year ended 31 March 2014, together with the Reports of the Directors and the Auditors thereon and the Directors' Remuneration Report with the associated Auditors' Report. These are contained in the Company's Annual Report and Accounts.

Resolution 2: declaration of a dividend

A final dividend can only be paid after it has been approved by the shareholders and cannot exceed the amount recommended by the Board. A final dividend of 6.85 pence per ordinary share is recommended for payment by the Board to the shareholders who are entered in the register of members of the Company at the close of business on 13 June 2014 and, if approved, the date of payment of the final dividend will be 31 July 2014. For the avoidance of doubt, shares issued under the Rights Issue shall not entitle their holder to receive the final dividend for the year ended 31 March 2014, the record date for which is 13 June 2014.

Resolutions 3 and 4: approval of Directors' Remuneration Report and Directors' Remuneration Policy

Following changes to the Act, effective from 1 October 2013, the Directors' Remuneration Report is now divided into two parts: an Annual Statement, which is set out on page 40 of the Company's Annual Report and Accounts, and an Annual Report on Remuneration, which is set out on pages 42 to 47 of the Company's Annual Report and Accounts (together the "Directors' Remuneration Report"), and the Directors' Remuneration Policy, which is set out on pages 48 to 53 of the Company's Annual Report and Accounts.

The Act requires that the Directors seek, as a separate resolution, the approval of shareholders to the Directors' Remuneration Report (other than the Directors' Remuneration Policy) on an annual basis. This approval is sought in Resolution 3.

In addition, the Act requires the Company to seek the binding approval of shareholders to the Directors' Remuneration Policy at its first Annual General Meeting after 1 October 2013. As this Policy is binding, after it takes effect, the Directors will not be entitled to remuneration unless such remuneration is consistent with the approved Directors' Remuneration Policy from time to time or shareholders otherwise approve the remuneration. Approval to the Directors' Remuneration Policy is sought in Resolution 4. The Directors' Remuneration Policy sets out a forward looking policy on Directors'remuneration and if approved, it will take effect from the conclusion of the Annual General Meeting. The Act then requires the Company to seek shareholder approval to the Directors' Remuneration Policy at any time the Company wishes to make a change to the Policy and at least once every three years.

Resolutions 5, 6, and 7: re-election of Directors

The Company's Articles of Association require Directors to retire every three years. Under this provision, Simon Gibbins is required to retire at the Company's Annual General Meeting this year and is eligible for re-election.

The Company's Articles of Association also require non-executive Directors who have served on the Board for more than nine years to retire at each Annual General Meeting thereafter. Consequently, Richard Moon, who was appointed to the Board in September 2004 and Graham Williams, who was appointed to the Board in December 2003, are required to retire at the forthcoming Annual General Meeting and are eligible for re-election. While no longer deemed to be independent under the UK Corporate Governance Code, the Board is of the view that their objectivity and willingness to challenge management have not been compromised in any way by their length of tenure on the Board and that they therefore remain independent.

The Nomination Committee has confirmed in its recommendations to the Board that, following a formal evaluation of the Board, the performance of each of the Directors standing for re-election continues to be effective and that each Director demonstrates sufficient commitment to their role to be suitable for re-election.

A short biography of each Director eligible for re-election is set out in Appendix 1 to this Notice.

Resolutions 8 and 9: re-appointment of auditors

The Act requires that the auditors of a company must be re-appointed at each general meeting at which accounts are laid. After considering relevant information, the Audit Committee recommended to the Board that the Company's existing Auditors, Ernst & Young LLP, be re-appointed until the next general meeting at which accounts are laid. Approval to the re-appointment is sought in Resolution 8.

In accordance with current best practice, Resolution 9 is a separate resolution which gives authority to the Directors to determine the Auditors'remuneration.

Resolution 10: authority to allot

The Act requires that, to allot unissued shares, the Directors must receive authority from shareholders. The Company's Articles of Association give a general authority to the Directors to allot unissued shares, which is subject to renewal by shareholders. This Resolution will allow the Directors to issue new shares up to a total nominal value of £1,044,299 (the Section 551 Amount) which represents approximately one-third of the Company's issued share capital (calculated exclusive of any treasury shares) following completion of the Rights Issue. This authority will expire on the earlier of the date of the Company's next Annual General Meeting or 28 October 2015. As at 20 June 2014, the Company did not hold any treasury shares within the meaning of Section 724(5) of the Companies Act 2006.

The Directors have no present intention of exercising this authority but, as in previous years, consider it desirable that they should have the flexibility to issue new shares from time to time to enable the Company to act in the best interests of shareholders, when opportunities arise. However, they will contemplate using this authority to take advantage of targeted acquisitions that help deliver the Company's strategy.

Resolutions 11 and 13: additional authorities to allot shares and disapplication of statutory pre-emption rights in connection with a rights issue

These resolutions authorise the Directors to allot, in addition to the authority referred to in Resolution 10, up to a further nominal amount of £1,044,299 in connection with a pre-emptive offer to existing shareholders by way of a rights issue, without the need to comply with the strict requirements of the statutory pre-emption provisions. This is in accordance with guidance on directors' powers to allot shares published by the Association of British Insurers ("ABI") on 31 December 2008 and amended on 30 November 2009.

The guidance states that ABI members would support resolutions authorising the allotment of an additional one-third of the issued ordinary share capital provided that the additional authority can only be used for fully pre-emptive rights issues. In accordance with the ABI guidance, in the event that the general and additional authorities were used and:

• the number of ordinary shares in issue is thereby increased, in aggregate, by more than one-third; and
• in the case of any issue being in whole or part by way of a fully pre-emptive rights issue, where the monetary proceeds exceed onethird (or such lesser relevant proportion) of the pre-issue market capitalisation of the Company,

all members of the Board who wish to remain in office will stand for re-election at the next Annual General Meeting of the Company following the decision to make the issue in question.

While the Directors have no present intention to make use of these authorities (which will expire on the earlier of the date of the Company's next Annual General Meeting or 28 October 2015), as in previous years, they intend to take advantage of the flexibility conferred by these authorities and will contemplate using them for targeted acquisitions that help deliver the Company's strategy.

The figures in resolutions 11 and 13 take into account the increase in share capital as a result of the Rights Issue.

Resolution 12: disapplication of statutory pre-emption rights

The Act requires that, subject to certain exceptions, before directors of a company can issue any new shares (including the sale of treasury shares) for cash, the new shares must first be offered to existing members of the Company in proportion to the number of shares which they hold at the time of the offer.

The Company's Articles of Association give a general authority to the Directors so that this statutory pre-emption requirement does not apply to allotments of shares or the sale of treasury shares for cash up to a specific amount, which is subject to renewal by shareholders.

In addition to and without prejudice to the authority in Resolution 11, this Resolution would allow the Directors to allot shares or sell treasury shares for cash only pursuant to the authority conferred by Resolution 10 up to a nominal value of £156,660 (the Section 561 Amount) which is approximately five per cent of the Company's issued share capital (calculated inclusive of treasury shares) following the completion of the Rights Issue.

This means that the rights of existing shareholders are protected. If a share issue is not a rights issue, the proportionate interest of existing shareholders could not, without their agreement, be reduced by more than five per cent. by the issue of new shares or the sale of treasury shares for cash to new shareholders. Such authority would expire on the earlier of the date of the Company's next Annual General Meeting or 28 October 2015. Again, the Directors have no present intention of exercising this authority but, as in previous years, consider it desirable that they should have the flexibility to act in the best interests of shareholders when opportunities arise. They will contemplate using the authorities to take advantage of targeted acquisitions that help deliver the Company's strategy.

Resolution 14: purchase of own shares by the Company

The Act requires that a company must be authorised by its shareholders for it to purchase its own shares. The Company's Articles of Association contain a provision allowing the Directors to purchase the Company's own shares, subject to the prior authority of the shareholders having been obtained. This Resolution seeks authority for the Company to make market purchases of its own shares within the limits set out.

The Directors are of the opinion that it would be advantageous for the Company to be in a position to purchase its own shares through the London Stock Exchange should market conditions and price justify that action. The proposed authority would enable the Company to purchase up to a maximum of 6,266,425 ordinary shares of five pence each in the capital of the Company with a stated upper limit on the price payable, which reflects the requirements of the Listing Rules (which represents approximately 10 per cent. of the Company's share capital as increased by the Rights Issue). Purchases would only be made after the most careful consideration, where the Directors believed that an increase in earnings or net assets per share would result and where purchases were, in the opinion of the Directors, in the best interests of the Company and its shareholders. The Directors consider that it is prudent to obtain the proposed authority, although they do not currently intend to exercise it.

The Act permits companies to hold any shares acquired by way of market purchases in treasury rather than having to cancel them. The Company would consider holding any of its own shares purchased under the authority granted by Resolution 14 as treasury shares. This would give the Company the ability to re-issue treasury shares, as and when required, quickly and cost effectively and would provide the Company with additional flexibility in the management of its capital base. No dividends would be paid on shares while held in treasury and no voting rights would attach to those shares.

The figures in resolution 14 take into account the increase in share capital as a result of the Rights Issue.

Resolution 15: notice period for general meetings

Due to changes in the law made by the implementation of the Companies (Shareholders' Rights) Regulations 2009, listed companies must call general meetings (other than an annual general meeting) on at least 21 clear days' notice unless the company:

• a) has obtained shareholder approval for the holding of general meetings on 14 clear days' notice by passing an appropriate resolution at its most recent annual general meeting; and
• b) offers the facility for shareholders to vote by electronic means accessible to all shareholders.

To enable the Company to continue to utilise the shorter notice period of 14 days for calling such general meetings, shareholders are being asked to approve this Resolution. 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 to the advantage of shareholders as a whole. If granted, this authority will be effective until the Company's next Annual General Meeting. This is the same authority which was sought and granted at previous Annual General Meetings.

Resolution 16: adoption of new Unapproved Share Option Plan

Resolution 16 seeks shareholder approval for the adoption of the Acal plc 2014 Unapproved Share Option Plan ("USOP") and authorisation for the Directors to implement the USOP and to establish equivalent plans, modified to take account of overseas legislation. The USOP is very similar to the Acal plc 2010 Company Share Option Plan ("CSOP"), except that it will not qualify as a tax-advantaged share option plan under Schedule 4 to the Income Tax (Earnings and Pensions) Act 2003 and it enables options to be granted over shares worth more than the £30,000 limit in the CSOP. Directors of Acal plc will not be eligible to participate in the USOP.

Appendix 1

Short biographies of Directors proposed for re-election

Executive Director

Simon Gibbins

Simon Gibbins was appointed as Group Finance Director in July 2010. A Chartered Accountant, he was previously Global Head of Finance and Deputy CFO at Shire plc. Prior to joining Shire in 2000, he spent six years with ICI plc in various senior finance roles, both in the UK and overseas. His earlier career was spent with Coopers & Lybrand in London.

Non-Executive Director

Richard Moon

Richard Moon joined the Board in September 2004 and became Chairman in April 2005. Formally a Director of Racal Electronics plc and Chief Executive of Thales plc, he is Non-Executive Chairman of Seven Technologies Holdings Limited and is Chairman of Synergie Business Limited.

Non-Executive Director

Graham Williams

Graham Williams was appointed to the Board in December 2003. His early business experience was gained in private equity with Charterhouse and Barclays Private Equity, both in the UK and France. A board member of Hays plc for 19 years, and now on their pension fund's investment committee, he is also a schools' governor.

Appendix 2

Summary of the main terms of the Acal plc 2014 Unapproved Share Option Plan ("USOP")

Introduction

The USOP is being introduced to provide incentives for employees of the Company and its subsidiaries ("Group"), other than Directors of the Company, where it is considered appropriate for options to be granted in excess of the £30,000 limit contained in the Acal plc 2010 Company Share Option Plan. The USOP will not meet the conditions for a tax-advantaged CSOP.

The USOP will be administered by the Company's Board of Directors ("Board") or an authorised Committee of the Board.

Type of award

The Company may grant (or recommend to the trustees of an employee trust to grant) options to acquire the Company's ordinary shares ("Shares"). The exercise price per Share may not be less than the market value of a Share on the grant date (or the nominal value, if greater, in the case of any option which will be satisfied by the issue of new Shares directly to the option holder).

No consideration is payable by the option holder for the grant of an option.

Eligibility

An option may be granted to any employee of the Group who is not a Director of the Company itself.

Timing of grants

Options may be granted at any time during the 10-year period from the date on which the USOP is adopted by shareholders, except during a prohibited period.

Individual limit

No individual may be granted options in any 12-month period over Shares worth more than 150% of their basic salary. This limit includes options granted during the relevant period under the USOP and under any other discretionary employees'share scheme established by the Group.

Share capital limit

The maximum number of Shares placed under option under the USOP or placed under option, awarded or issued under any other employees'share scheme (whether or not discretionary) operated by the Group in any 10-year period is 10 per cent of the Company's issued ordinary share capital.

This limit does not include any Shares purchased on the market by the trustees or Shares subject to options or other awards which have lapsed, been renounced or otherwise become incapable of vesting.

Exercise of options

An option may be subject to a performance target or other condition of exercise. This target or condition may be substituted, varied or waived if an event occurs which causes the grantor to consider it is no longer appropriate.

No option may be exercised during a prohibited period or later than the tenth anniversary of its grant date.

Cessation of employment

As a general rule, an option may only be exercised while the option holder remains in the employment of the Group and has not given or been given notice of termination of employment.

However, if an option holder leaves employment because of injury, ill-health, disability, redundancy, retirement, his employing company or business leaving the Group or another reason at the grantor's discretion, he will be entitled to exercise his option up to six months after employment ceases. If an option holder dies, his personal representatives will be entitled to exercise his option up to 12 months after his death.

The number of Shares subject to the option that may be exercised will be determined by the extent that any performance target or other condition has been satisfied and the Board may apply a pro rata reduction based on the period of time the option holder had been employed since the grant date.

Company events

If a person other than a new holding company obtains control of the Company as a result of making a general offer, a proportion of the options (based on the period of time held) may be exercised within six months of the offer becoming unconditional.

If a person becomes entitled or bound to acquire shares in the Company under the Companies Act 2006, a proportion of the options may be exercised between the date when the person serves notice and seven days before the date on which the person ceases to be entitled to serve such a notice.

If a person proposes to obtain control of the Company in pursuance of a compromise or arrangement sanctioned by the court, option holders may give notice to exercise a proportion of their options conditionally on the compromise or arrangement being sanctioned by the court.

If a company (including a new holding company) obtains control of the Company as a result of making a general offer or pursuant to a compromise or arrangement sanctioned by the court or becomes entitled or bound to acquire shares in the Company, an option holder may, by agreement with the acquiring company, release his option in consideration of the grant to him of an equivalent new option over shares in the acquiring company.

The number of Shares subject to an option, the description of the Shares and the exercise price may be adjusted if there is a variation in the share capital of the Company.

Rights of employees

Options are not capable of being transferred, charged or otherwise alienated by the option holder.

The USOP does not form any part of any contract of employment between a Group company and an employee. Unless expressly provided in his contract of employment, an employee has no right to be granted an option.

The benefit to an employee of participation in the USOP does not form any part of his remuneration for any purpose and is not pensionable.

Overseas plans

The Company may establish separate plans, substantially on the same terms as the USOP, but modified to take account of local tax, exchange control or securities law in overseas territories. The Shares which may be placed under option under such a modified plan count towards the limits in the USOP.

Amendments

The Board may amend the USOP from time to time.

No amendment may be made without prior approval of the Company in general meeting for the benefit of existing or future option holders to the rules relating to:

• the persons to whom options may be granted;
• the limit on the aggregate number of Shares over which options may be granted;
• the limit on the number of Shares over which options may be granted to any employee; or
• the adjustment to options on a variation of share capital

except for an amendment which is of a minor nature and benefits the administration of the USOP or an amendment which is necessary or desirable in order to take account of a change of legislation or to obtain or maintain favourable tax, exchange control or regulatory treatment for option holders, the Company or another member of the Group.

An amendment may not adversely affect the rights of existing option holders except where the amendment has been approved by those option holders.

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