PEET LIMITED — AGM Information 2013

Oct 24, 2013

PEET LIMITED

ABN 56 008 665 834

NOTICE OF ANNUAL GENERAL MEETING

AND

EXPLANATORY MEMORANDUM TO SHAREHOLDERS

A PROXY FORM IS ENCLOSED

Please read the Notice and Explanatory Memorandum carefully.

If you are unable to attend the meeting please complete and return the enclosed proxy form in accordance with the specified instructions.

PEET LIMITED

ABN 56 008 665 834

NOTICE OF ANNUAL GENERAL MEETING

Notice is given that the Annual General Meeting of Peet Limited ("the Company") will be held at the Parmelia Hilton Hotel, 14 Mill Street, Perth, Western Australia on Tuesday, 26 November 2013 at 10.00 am (AWST).

Agenda items

1 Financial report

To receive and consider the financial report of the Company and the reports of the directors and auditor for the year ended 30 June 2013.

2 Resolution 1 - Re-election of Stephen Francis Higgs

To consider and, if thought fit, to pass the following resolution as an ordinary resolution:

"That Stephen Francis Higgs, being a Director of the Company who retires in accordance with rule 8.1(d) of the Company's Constitution and ASX Listing Rule 14.4, and being eligible, be re-elected as a Director of the Company."

3 Resolution 2 - Re-election of Anthony James Lennon

To consider and, if thought fit, to pass the following resolution as an ordinary resolution:

"That Anthony James Lennon, being a Director of the Company who retires in accordance with rule 8.1(d) of the Company's Constitution, and being eligible, be reelected as a Director of the Company."

4 Resolution 3 - Approval of Peet Limited Performance Rights Plan

To consider and, if thought fit, to pass the following resolution as an ordinary resolution:

"That for the purposes of ASX Listing Rule 7.2, exception 9, and for all other purposes, the Peet Limited Performance Rights Plan ("PPRP") tabled at the meeting (and signed by the Chairman for the purpose of identification), and the issue of securities under the PPRP, is approved."

Voting exclusion statement

The Company will disregard any votes cast on Resolution 3 by:

• any director who is eligible to participate in any employee incentive scheme of the Company, or any of their associates; and
• as proxy by a member of the key management personnel ("KMP") or their closely related parties.

However, the Company need not disregard a vote cast on Resolution 3 by such persons if:

• the vote is cast as a proxy on behalf of a person entitled to vote on Resolution 3 and that vote has been cast as specified on the proxy form; or
• where there is no specified voting direction, the vote is cast by the chair of the meeting as a proxy on behalf of a person entitled to vote on Resolution 3 and their appointment expressly authorises the chair to exercise the proxy even though Resolution 3 is connected with the remuneration of a member of the KMP.

5 Resolution 4 - Approval for the grant of FY14 Performance Rights under the Peet Limited Performance Rights Plan to Brendan Gore

To consider and, if thought fit, to pass the following resolution as an ordinary resolution:

"For the purposes of ASX Listing Rule 10.14 and for all other purposes, approval is given to grant 1,023,622 FY14 Performance Rights to the Managing Director and Chief Executive Officer, Mr Brendan Gore, under the Peet Limited Performance Rights Plan, as amended from time to time, and on the terms and conditions summarised in the Explanatory Memorandum."

Voting exclusion statement

The Company will disregard any votes cast on Resolution 4 by:

• Mr Gore and by any other director who is eligible to participate in any employee incentive scheme of the Company, or by any of their respective associates; and
• as proxy by a member of the KMP or their closely related parties.

However, the Company need not disregard a vote cast on Resolution 4 by such persons if:

• the vote is cast as a proxy on behalf of a person entitled to vote on Resolution 4 and that vote has been cast as specified on the proxy form; or
• where there is no specified voting direction, the vote is cast by the chair of the meeting as a proxy on behalf of a person entitled to vote on Resolution 4 and their appointment expressly authorises the chair to exercise the proxy even though Resolution 4 is connected with the remuneration of a member of the KMP.

6 Resolution 5 - Adoption of Remuneration Report

To consider and, if thought fit, to pass the following resolution as an ordinary resolution:

"That the Company's Remuneration Report for the year ended 30 June 2013 be adopted."

Note: The vote on this item is advisory only and does not bind the directors or the Company.

Voting exclusion statement

The Company will disregard any votes cast on Resolution 5 by or on behalf of the Company's KMP, details of whose remuneration is included in the Remuneration Report, or their closely related parties, whether as a shareholder or as a proxy. However, the Company need not disregard a vote cast on Resolution 5 by a KMP, or a closely related party of a KMP, if:

• the vote is cast as a proxy on behalf of a person entitled to vote on Resolution 5 and that vote has been cast as specified on the proxy form; or
• where there is no specified voting direction, the vote is cast by the chair of the meeting as a proxy on behalf of a person entitled to vote on Resolution 5 and their appointment expressly authorises the chair to exercise the proxy even though Resolution 5 is connected with the remuneration of the KMP.

7 Resolution 6 - Appointment of Auditor

To consider and, if thought fit, to pass the following resolution as an ordinary resolution:

"That Ernst & Young, having been duly nominated by a member of the Company and consented in writing to act, be appointed as registered auditor of the Company."

8 Resolution 7 - Contingent Board spill resolution

This item will be considered at the AGM only if at least 25% of votes cast on Resolution 5 are cast against that resolution (i.e. are against the adoption of the Remuneration Report). Further explanation of the circumstances in which this resolution will be considered is included in the Explanatory Statement.

If at least 25% of the votes cast on Resolution 5 are against that resolution, to consider and, if thought fit, to pass the following resolution as an ordinary resolution:

"That:

• (a) an extraordinary general meeting of the Company (the "Spill Meeting") be held within 90 days of the passing of this resolution; and
• (b) all Directors of the Company who:
  • i. were directors of the Company when the resolution by the directors to approve the Directors' Report considered at this Annual General Meeting of the Company was passed; and
  • ii. are not a managing director who may continue to hold office indefinitely without being re-elected to the office in accordance with the ASX Listing Rules;

cease to hold office immediately before the end of the Spill Meeting; and

(c) resolutions to appoint persons to offices that will be vacated before the end of the Spill Meeting must be put to the vote at the Spill Meeting."

Voting exclusion statement

The Company will disregard any votes cast on Resolution 7 by or on behalf of the Company's KMP, or their closely related parties, whether as a shareholder or as a proxy. However, the Company need not disregard a vote cast on Resolution 7 by a KMP, or a closely related party of a KMP, if:

• the vote is cast as a proxy on behalf of a person entitled to vote on Resolution 7 and that vote has been cast as specified on the proxy form; or
• where there is no specified voting direction, the vote is cast by the chair of the meeting as a proxy on behalf of a person entitled to vote on Resolution 7 and their appointment expressly authorises the chair to exercise the proxy even though Resolution 7 is connected with the remuneration of the KMP.

Explanatory Memorandum

Shareholders are referred to the Explanatory Memorandum accompanying and forming part of this notice of meeting.

Entitlement to vote

It has been determined that under regulation 7.11.37 of the Corporations Regulations 2001 (Cth), for the purposes of the Annual General Meeting, shares will be taken to be held by the persons who are the registered holders at 7.00pm (Sydney time), Sunday, 24 November 2013. Accordingly, share transfers registered after that time will be disregarded in determining entitlements to attend and vote at the meeting.

Proxies

A shareholder entitled to attend and vote has a right to appoint a proxy to attend and vote instead of the shareholder. A proxy need not be a shareholder.

Members of the KMP (which includes each of the directors) will not be able to vote as proxy on Resolutions 3, 4, 5 and 7 unless the shareholder instructs them how to vote, or in the case of the Chairman of the meeting, unless the shareholder expressly authorises the Chairman of the Meeting to do so.

If you intend to appoint a member of the KMP (other than the Chairman) as your proxy, then you should ensure you direct your proxy how to vote on Resolutions 3, 4, 5 and 7. If you intend to appoint the Chairman of the Meeting as you proxy, and you do not direct your proxy how to vote on Resolutions 3, 4, 5 and 7, you need to expressly authorise the Chairman of the Meeting to exercise your proxy.

The Chairman of the Meeting intends to vote undirected proxies in favour of Resolutions 3, 4, 5 and 7.

A shareholder that is entitled to cast two (2) or more votes may appoint up to two (2) proxies and may specify the proportion or number of votes each proxy is appointed to exercise. If no proportion or number is specified, each proxy may exercise half of the shareholder's votes.

A Proxy Form (with signing instructions) accompanies this Notice and to be effective must be received at the Company's share registry, Computershare Investor Services,

• In Person: to Level 2, 45 St Georges Terrace, Perth WA
• By Mail: to GPO BOX 242, Melbourne, Vic 3001
• By Facsimile: 1800 783 447 or +61 3 9473 2555 (outside Australia) , or
• For Intermediary Online subscribers only (custodians) please visit www.intermediaryonline.com to submit your voting intentions,

by no later than 10.00am (AWST), Sunday, 24 November 2013

By Order of the Board Dated: 18 October 2013

Dom Scafetta Group Company Secretary

PEET LIMITED ABN 56 008 665 834

EXPLANATORY MEMORANDUM TO SHAREHOLDERS

This Explanatory Memorandum has been prepared to assist shareholders to understand the business to be put to shareholders at the forthcoming Annual General Meeting ("AGM").

1 Financial report

The Corporations Act 2001 (Cth) ("Corporations Act") requires the:

• reports of the directors and auditor; and
• annual financial report, including the financial statements of the Company for the year ended 30 June 2013,

to be laid before the AGM. The Corporations Act does not require a vote of shareholders on the reports or statements. However, shareholders will be given ample opportunity to raise questions or comments on the reports and statements at the meeting.

Also, a reasonable opportunity will be given to members as a whole at the meeting to ask the Company's auditor questions relevant to the conduct of the audit, the preparation and content of the auditor's report, the accounting policies adopted by the Company in relation to the preparation of the financial statements and the independence of the auditor in relation to the conduct of the audit.

2 Resolutions 1 and 2 - Re-election of directors

Rule 8.1(d) of the Company's Constitution provides that, if after excluding the Managing Director and directors appointed since the last Annual General Meeting, the number of directors is five or less, then two of the remaining directors must retire from office. Accordingly, Mr Stephen Francis Higgs and Mr Anthony James Lennon retire by rotation and offer themselves for re-election.

The experience, qualifications and other information about Messrs Higgs and Lennon are shown on the next page.

STEPHEN FRANCIS HIGGS, BEc (Syd), is an Independent Non-executive Director of the Company.

Stephen Higgs has held a series of board roles including with listed Australian companies such as Rural Press Limited, Primary Healthcare Limited and Freedom Nutritional Products and other leading roles including Chairman of Orlando Wines, and director of Leigh Mardon, IPAC Securities and Ausoft Limited.

In addition Mr Higgs worked for 20 years with UBS and its predecessors to cement a leadership position in corporate finance advice and the private equity market.

He is also Chairman of the Juvenile Diabetes Research Foundation Australia, a role he has undertaken since 2002.

Mr Higgs' commitment to the community has extended to include positions working as a Councillor at St Andrew's College at Sydney University and Trustee of Redkite (formerly the Malcolm Sargent Cancer Fund for Children in Australia).

Stephen Higgs joined the Board of Peet Limited in June 2004.

ANTHONY JAMES LENNON, BA, Grad Dip Bus Admin, MAICD is a Non-executive Director of the Company.

Anthony Lennon joined Peet in 1991 and became a Director in 1996.

He moved to Victoria over a decade ago to establish Peet's operations in Australia's eastern states and oversaw significant expansion since that time.

Before joining the Company, Mr Lennon worked in the United Kingdom, where he completed his post-graduate Diploma in Business Administration while on a Graduate Management Training Scheme with major international construction and development company, John Laing PLC. His time with this global company saw him gain valuable experience in property planning, marketing, feasibility analysis and project management.

Mr Lennon's responsibilities since joining Peet have included project management, broadacre acquisitions, marketing and financing and a six-year stint as Chairman of one of WAs largest conveyancing businesses.

Until his transition from Executive to Non-executive Director on 27 August 2012, Mr Lennon was Peet Limited's National Business Development Director.

He is a board member of the Urban Development Institute of Australia (Victoria).

Directors' recommendation regarding the re-election of Mr S F Higgs

With Mr S F Higgs abstaining, the Directors unanimously recommend you vote in favour of the re-election of Mr S F Higgs.

Directors' recommendation regarding the re-election of Mr A J Lennon

With Mr A J Lennon abstaining, the Directors unanimously recommend you vote in favour of the re-election of Mr A J Lennon.

3 Resolution 3 – Approval of Peet Limited Performance Rights Plan ("PPRP")

The Company seeks renewed shareholder approval for its PPRP.

Shareholders previously approved the PPRP at the Company's 2008 AGM. The Company is seeking approval of the PPRP for a further 3 years, in accordance with Listing Rule 7.2, exception 9.

No changes to the PPRP since its approval in 2008

A summary of the terms of the PPRP is set out in Annexure A. Shareholders may obtain a copy of the full terms of the PPRP on request from the Group Company Secretary.

The PPRP operates as part of the Company's long term incentive scheme for Executive Directors and employees of the Company and "Group Companies" (which includes Peet Limited, its subsidiaries and any other entity declared by the Board to be a member of the group for the purposes of the PPRP from time to time) (the "Eligible Executives).

Participation of Directors in the PPRP is subject to shareholder approval under the ASX Listing Rules.

Number of securities issued under the PPRP since its approval in 2008

• 11,544,096 Performance Rights have been issued under the PPRP since 2008, of which 2,244,998 have vested and converted into ordinary shares and 2,290,564 have lapsed or been forfeited.
• 7,008,534 Performance Rights remain on issue.

ASX Listing Rule 7.2, exception 9 approval

Broadly, ASX Listing Rule 7.1 provides that a company must obtain shareholder approval if it wishes to issue more than 15% of its equity securities within a rolling 12 month period. ASX Listing Rule 7.2, exception 9, provides an exception to ASX Listing Rule 7.1 for an issue of securities under an "employee incentive scheme", if, within 3 years before the date of issue, shareholders approved the issue of securities under the scheme.

Resolution 3 seeks renewed shareholder approval for the purposes of ASX Listing Rule 7.2, exception 9, and all other purposes for the issue of securities (i.e. Performance Rights and fully paid ordinary shares in the Company following the vesting of Performance Rights) under the PPRP. This means that the issue of these Performance Rights and shares under the PPRP, if approved, will not be counted within the 15% cap on the Company's capacity to issue additional equity securities under ASX Listing Rule 7.1. This will give the Company the flexibility to issue further securities up to the 15% limit if the need or opportunity arises in the future.

Directors' recommendation in respect of Resolution 3

All of the Directors, except Mr Gore, unanimously recommend that shareholders vote in favour of Resolution 3.

Mr Gore has abstained from making a recommendation in respect of Resolution 3 as he has a material personal interest in the outcome of the Resolution.

4 Resolution 4 - Approval for the grant of FY14 Performance Rights ("PRs") under the PPRP to Brendan Gore

Shareholder approval is sought for the purposes of ASX Listing Rule 10.14 and all other purposes for the granting of 1,023,622 FY14 PRs to Mr Gore under the PPRP.

A summary of the terms of the FY14 PRs proposed to be granted to Mr Gore is shown in the table following:

Performance Period	VestingTerm	Exercise Price	PerformanceConditions1	Allocation(%)
01/07/2013 to 30/06/2016	3 yrs	$0.00	ROAFEFUM Growth	60%40%100%

1. Refer to discussion following on Performance Conditions.

Performance conditions

The Performance Conditions will be measured over a three-year period from 1 July 2013 to 30 June 2016 ("FY14 Performance Period").

The measures used to determine performance are Return on Average Funds Employed ("ROAFE") and Funds under Management ("FUM") Growth.

The vesting of 60% of the FY14 PRs proposed to be granted to Mr Gore will be subject to the ROAFE condition and 40% to the FUM Growth condition.

ROAFE

The ROAFE condition will be measured as the average of the below formula calculated on an annual basis over the FY14 Performance Period:

EBIT Average (Funds Employed)

Where:

EBIT means the earnings before interest, tax, write-downs of inventories and development costs and increases in the carrying value of inventories for the relevant financial year.

Funds Employed means the sum of (bank debt, convertible notes, contributed equity, minority interests and retained earnings and less cash) at the start and end of the relevant financial year.

Peet syndicates which are treated as subsidiaries under accounting standards will be treated as syndicates in the calculation of ROAFE.

The ROAFE is then compared to the Board's internal target ROAFE for the FY14 Performance Period.

Of the 60% of the FY14 PRs proposed to be granted subject to the ROAFE condition, the proportion to vest will be as follows:

Performance Level1	% of FY14 PRs that may be eligible tovest
Less than 75% of the ROAFE target ("Target")	0%
75% of the Target	30%
75% to 85% of the Target	30% to 50% (pro-rata)
85% to 100% of Target	50% to 70% (pro-rata)
100% to 110% of Target	70% to 100% (pro-rata)
Greater than 110% of Target	100%

1. The actual performance against target will be reported to shareholders in the Company's Remuneration Report for the year ending 30 June 2016.

FUM Growth

FUM Growth will be measured as the cumulative value of properties:

• acquired by the Company on balance sheet and subsequently sold into a Peet syndicate; or
• funded by way of a Peet syndicate; or
• for which the Company has been appointed development manager (including under a joint venture arrangement),

during the FY14 Performance Period.

The aggregate of the FUM Growth during the FY14 Performance Period is reduced by the proportionate equity interest retained by the Company and is then compared to the FUM Growth target set by the Board.

The Board will review the FUM Growth targets each year and determine what particular activities will or will not be included in such targets, for the subsequent three-year performance period.

Of the 40% of the FY14 PRs to be issued subject to the FUM Growth condition, the proportion to vest is as follows:

Performance Level	AggregateFUMGrowthtarget for FY14 PerformancePeriod	% of FY14 PRs that may beeligible to vest
Less than the target	Less than $60 million	0%
Target	$60 million	50%
Target to medium	$60 million to $100 million	50% to 70% (pro-rata)
Medium to maximum	$100 million to $150 million	70% to 100% (pro-rata)
Greater than maximum	Greater than $150 million	100%

ASX Listing Rule 10.14 approval

Broadly, ASX Listing Rule 10.14 provides that a company must obtain shareholder approval if it wishes to grant performance rights under an "employee incentive scheme" to a director of the company.

For the purposes of ASX Listing Rule 10.14, the PPRP is an "employee incentive scheme". Accordingly, the grant of FY14 PRs and shares issued following the vesting of the FY14 PRs under the PPRP to Mr Gore requires shareholder approval for the purposes of ASX Listing Rule 10.14.

For the purposes of ASX Listing Rule 10.15, the following information is provided:

(i) If the person to whom the securities will be issued is not a director, a statement of the relationship between the person and the director

Mr Gore is the Managing Director and Chief Executive Officer of the Company.

(ii) The maximum number of securities that may be acquired by all persons for whom approval is required and the formula for calculating the number of securities to be issued

The maximum aggregate number of securities that may be issued to Mr Gore if Resolution 4 is passed is 1,023,622 FY14 PRs.

Level of participation

The level of participation offered to Mr Gore under the PPRP has been determined with reference to market practice and within the Company's remuneration policies as set out in the Remuneration Report.

The Long Term Incentive ("LTI") amount for Mr Gore is 100% of his current fixed pay of $910,000.

The number of FY14 PRs allocated to Mr Gore was determined by dividing his LTI amount by the estimated fair value of a FY14 PR at 12 September 2013.

Valuation

The Company commissioned an external adviser to provide an indicative value of the FY14 PRs the subject of Resolution 4.

The fair value of a FY14 PR is based on a Binomial option pricing model. This has then been discounted to reflect the probability of achieving the relevant performance hurdles, as at the date of the valuation. The fair value as at 12 September 2013 has been estimated at $0.889.

A summary of the inputs and assumptions adopted by the external adviser in determining the fair value of a FY14 PR are contained in the following table:

Assumed Vesting Date	UnderlyingShare Price	ExercisePrice	DividendYield	Risk FreeRate	Volatility
30 June 2016	$1.38	$0.00	2.90%	2.70%	45%

(iii) The price, or the formula for calculating the price, for each security to be acquired under the PPRP

No payment is required for the grant of a FY14 PR or for the issue of the relevant shares upon vesting of the same.

(iv) The names of all persons referred to in ASX Listing Rule 10.14 who received securities under the PPRP since the last approval, the number of the securities received, and acquisition price for each security

Mr Gore is the only person referred to in Listing Rule 10.14 who has received securities under the PPRP since last year's AGM.

The PRs referred to in the table below do not form part of the PRs the subject of Resolution 4.

Issued to	Grant date	Performance Period	Quantity	ExercisePrice	Status
Mr Gore	28/11/2012	3 yrs ending 30/06/2015	2,086,677	$0.00	Not yet vested

(v) The names of all persons referred to in ASX Listing Rule 10.14 entitled to participate in the PPRP

Mr Gore is the only person referred to in ASX Listing Rule 10.14 entitled to participate in the grant under the PPRP being considered at this meeting.

(vi) Voting exclusion statement

Refer to the "voting exclusion statement" in the Notice of Meeting attached to this Explanatory Memorandum.

(vii) The date by which the Company will grant the securities

The FY14 PRs will be granted as soon as practicable after shareholder approval is obtained and in any event no later than 12 months after this meeting.

(viii) Details of loans provided in respect to the grant of securities

No loans will be provided to Mr Gore in respect to the grant of FY14 PRs.

Other information

The table following sets out:

• the existing interests of Mr Gore in the Company's shares and other securities;
• the maximum number of securities (i.e. PRs and shares issued following the assumed vesting of the PRs) that may be issued to Mr Gore under the PPRP; and
• the interests of Mr Gore after the PRs have been issued (assuming he has been issued the maximum number of PRs under the PPRP).

Existing Interests			Proposed Grant		Interests after Proposed Grant
Director	No ofPRs	No ofShares1	% ofShares2	Max. Noof PRs	Max. Noof Shares	Max. Noof PRs	Max. Noof Shares	Max. %ofShares 3
Mr Gore	3,224,177	1,171,048	0.27%	1,023,622	1,023,622	4,247,799	5,418,847	1.23%

1. Mr Gore also holds 1,200,000 unlisted options.

2. Based on 433,389,348 ordinary shares on issue at the date of the notice of AGM.

3. Based on shares on issue at the date of the notice of AGM and assuming that all Mr Gore's existing interests in PRs, but not options, vest and are converted to ordinary shares.

Trading history

In the 12 month period before the date of this Notice of Meeting, the highest price of the Company's shares was $1.50 on 9 May 2013 and the lowest price was $0.85 on 19 October 2012. The volume weighted average price on the ASX over the 10 business days prior to the date of this Notice of Meeting was $1.41. The closing price on the trading day prior to the date of this Notice of Meeting was $1.405.

Remuneration

Details of Mr Gore's total current remuneration are shown in the Company's 2013 Remuneration Report forming part of the 2013 Annual Report. For those shareholders that have elected not to receive a hard copy of the 2013 Annual Report, an electronic copy can be found on the Company's website at www.peet.com.au.

Directors' recommendation in respect of Resolution 4

Mr Gore has a material personal interest in the outcome of Resolution 4 and, accordingly, abstains from making a recommendation in respect of the Resolution.

The Board (with Mr Gore abstaining) recommends that shareholders vote in favour of Resolution 4.

These recommendations are made on the basis that several benefits will flow to the Company by issuing PRs to Mr Gore under the PPRP, including the following:

• (i) equity based incentive schemes are a common and effective means of motivating and improving the performance of senior executives;
• (ii) it will ensure that the interests of Mr Gore are aligned with the interests of shareholders; and
• (iii) the PPRP is designed to provide an incentive for future performance with restrictions on securities vesting under the PPRP Rules encouraging Mr Gore to remain with the Company.

The Board considers the targets set for the vesting conditions to have a balance between being:

• (i) achievable and therefore incentivising Mr Gore; and
• (ii) challenging to ensure Mr Gore's performance is appropriately remunerated and his interests are aligned to those of shareholders.

5 Resolution 5 - Adoption of Remuneration Report

Section 250R(2) of the Corporations Act requires a resolution adopting the Remuneration Report be put to the vote.

The Remuneration Report is set out on pages 46 to 62 of the 2013 Annual Report.

Shareholders are advised that the vote on this item is advisory only and does not bind the Directors or the Company. However, the outcome of the vote could have consequences for the Board as outlined in the Explanatory Statement to Resolution 7.

6 Resolution 6 - Appointment of Auditor

The Company's existing auditors, PwC, will resign as auditors at the Annual General Meeting and will, subject to shareholder approval, be replaced by Ernst & Young.

The Corporations Act requires shareholders to appoint an auditor at the Annual General Meeting if there is a vacancy in the office of auditor of the Company.

A nomination has been received from a member of the company to appoint Ernst & Young as auditors to the Company. A copy of the nomination is attached as Annexure B to this Explanatory Memorandum in accordance with section 328B(3) of the Corporations Act.

Pursuant to the Corporations Act, Ernst & Young has consented in writing to act as auditor to the Company, and has not withdrawn that consent prior to the date of this notice of Annual General Meeting.

Directors' recommendation in respect of Resolution 6

The Directors unanimously recommend that shareholders vote in favour of Resolution 6.

7 Resolution 7 - Contingent Board spill resolution

The Corporations Act was amended in 2011 to introduce the "two strikes" rule. This rule provides that if at least 25% of the votes cast on a resolution that the remuneration report be adopted are against the adoption at two consecutive Annual General Meetings, then shareholders will have the opportunity to vote on a "Board Spill resolution".

At the Company's Annual General Meeting held 28 November 2012, more than 25% of the votes cast in respect of the 2012 Remuneration Report were against its adoption. This constitutes a "first strike".

If at least 25% of the votes cast on Resolution 5 are against the adoption of the 2013 Remuneration Report at the 2013 AGM, this will constitute a "second strike" and Resolution 7 (the Board spill resolution) will need to be put to the meeting and be voted upon at the 2013 AGM.

If less than 25% of votes cast on Resolution 5 are against the adoption of the 2013 Remuneration Report at the 2013 AGM, then there will be no "second strike" and Resolution 7 will not need to be put to the meeting.

If put to the meeting, the Board spill resolution will be considered as an ordinary resolution.

If the Board spill resolution is passed:

• (i) a further meeting of shareholders (the "Spill Meeting") must be held within 90 days of the passing of Resolution 7;
• (ii) any Directors of the Company who were directors when the resolution to approve the Directors' Report was passed will cease to hold office immediately before the end of the Spill Meeting (excluding a managing director, who may continue to hold office indefinitely without being re-elected to the office, in accordance with the ASX Listing Rules); and
• (iii) resolutions to appoint persons to offices that will be vacated before the end of the Spill Meeting must be put to a vote at the Spill Meeting.

A Director who ceases to hold office at the Spill Meeting is eligible to seek re-election as a Director of the Company at the Spill Meeting.

Annexure A – Summary of PPRP terms

Under the PPRP rules, Eligible Executives may be granted PRs on terms and conditions as determined by the Board. A performance right is an entitlement to a fully paid ordinary share in the Company, subject to satisfaction of certain performance criteria as determined by the Board. A PR confers no right to vote, attend meetings, participate in a distribution of profit or a return of capital or any other participating rights or entitlements on the participant unless and until the PR vests.

On satisfaction of the Performance Conditions the PRs vest and the Company must issue the relevant shares to the participant or purchase the shares on market. No payment is required from the participant for the issue or transfer of the relevant shares.

A share issued pursuant to a PR ranks equally and has the same rights as the ordinary shares of the Company. The Company will apply for any shares issued to a participant to be listed on the ASX.

If the relevant Performance Conditions (as determined by the Board and notified to the participant) are not satisfied within the time frame provided, the PR will lapse. In addition, the PPRP rules provide that:

• (transferability) a PR is not transferable other than with the consent of the Board or by force of law (upon death to the participant's legal personal representative or upon bankruptcy to the participant's trustee in bankruptcy). Where a participant purports to transfer a PR other than in these circumstances, the PR immediately lapses;

• (cessation of employment) where a participant ceases to be employed by the Company or a Group Company because of death or disability, bona fide redundancy or other reason approved by the Board, any unvested PRs may vest at the Board's discretion, having regard to the relevant performance conditions and in accordance with the PPRP rules;

• (fraud, dishonesty or breach of obligations) if a participant is found to have acted fraudulently or dishonestly or is in breach of their obligations to any Group Company, the Board may determine that any unvested PRs held by the participant immediately lapse, that any shares (which have been allocated pursuant to the vesting of PRs) held by the participant be forfeited and that, if a participant has sold such shares, the proceeds of sale are payable to the Company;

• (restrictions on shares) the Board has a discretion to impose restrictions (except to the extent prohibited by law or the ASX Listing Rules) on shares issued or transferred to a participant on vesting of a PR, and the Company may implement appropriate procedures to restrict a participant from so dealing in the shares;

• (reorganisation of capital) in the event of a reorganisation of capital, a participant's PRs may be adjusted, as set out in the PPRP rules;

• (lapse of Performance Rights) each PR which does not vest as at the 6-year anniversary of the granting of the PR will lapse immediately;

• (Board's power to amend the PPRP) the Board has the power to amend the provisions of the PPRP, or the terms or conditions of any PR granted under the PPRP subject to the following:

  • the ASX Listing Rules; and
  • the Board cannot make any amendment to the terms of a granted PR which reduces the participant's rights in respect of that PR, unless the participant has consented or the purpose of the amendment is to comply with the law, to correct a manifest error or mistake, or to take into consideration possible adverse tax implications in respect of the PPRP;

• (early vesting in certain events) the Board may determine that any unvested PRs vest, having regard to the extent to which the participant has satisfied the relevant Performance Conditions, if the following events occur:

  • a takeover bid is made for the Company's shares, the Board recommends a takeover bid, or a takeover bid becomes unconditional;
  • a court-ordered meeting in relation to a scheme for reconstruction or amalgamation of the Company;
  • a scheme of arrangement is approved;
  • compulsory acquisition following a takeover bid; or
  • voluntary or compulsory winding up of the Company.

• (receiving shares in an acquiring company if that company gains control of the Company) if another company obtains control of the Company as a result of a takeover bid or a scheme of arrangement, a participant may be provided (on vesting of PRs) with shares in the acquiring company in lieu of shares in the Company, if the Company, the acquiring company and the participant agree.

Annexure B – Nomination of Auditor

Mr B D Gore c/- 200 St Georges Terrace PERTH WA 6000 PH: (08) 9420 1111

9 October 2013

Mr Dom Scafetta Group Company Secretary Peet Limited Level 7, 200 St Georges Terrace PERTH WA 6000

Private and confidential

Dear Mr Scafetta

For the purposes of Section 328B(1) of the Corporations Act 2001, I, Brendan Gore as trustee for the Gore Family Trust, being a member of Peet Limited hereby nominate Ernst & Young as auditor of the Company at the Annual General Meeting to be held on 26 November 2013.

Yours sincerely

Brendan Gore

Peet Limited | ABN 56 008 665 834

Lodge your vote:

By Mail:

Computershare Investor Services Pty Limited GPO Box 242 Melbourne Victoria 3001 Australia

Alternatively you can fax your form to (within Australia) 1800 783 447 (outside Australia) +61 3 9473 2555

For intermediary Online subscribers only (custodians) www.intermediaryonline.com

For all enquiries call:

(within Australia) 1300 850 505 (outside Australia) +61 3 9415 4000

Proxy Form

For your vote to be effective it must be received by 10:00 am (AWST) Sunday, 24 November 2013

How to Vote on Items of Business

All your securities will be voted in accordance with your directions.

Appointment of Proxy

Voting 100% of your holding: Direct your proxy how to vote by marking one of the boxes opposite each item of business. If you do not mark a box your proxy may vote as they choose. If you mark more than one box on an item your vote will be invalid on that item.

Voting a portion of your holding: Indicate a portion of your voting rights by inserting the percentage or number of securities you wish to vote in the For, Against or Abstain box or boxes. The sum of the votes cast must not exceed your voting entitlement or 100%.

Appointing a second proxy: You are entitled to appoint up to two proxies to attend the meeting and vote on a poll. If you appoint two proxies you must specify the percentage of votes or number of securities for each proxy, otherwise each proxy may exercise half of the votes. When appointing a second proxy write both names and the percentage of votes or number of securities for each in Step 1 overleaf.

A proxy need not be a securityholder of the Company.

Signing Instructions

Individual: Where the holding is in one name, the securityholder must sign.

Joint Holding: Where the holding is in more than one name, all of the securityholders should sign.

Power of Attorney: If you have not already lodged the Power of Attorney with the registry, please attach a certified photocopy of the Power of Attorney to this form when you return it.

Companies: Where the company has a Sole Director who is also the Sole Company Secretary, this form must be signed by that person. If the company (pursuant to section 204A of the Corporations Act 2001) does not have a Company Secretary, a Sole Director can also sign alone. Otherwise this form must be signed by a Director jointly with either another Director or a Company Secretary. Please sign in the appropriate place to indicate the office held. Delete titles as applicable.

Attending the Meeting

Bring this form to assist registration. If a representative of a corporate securityholder or proxy is to attend the meeting you will need to provide the appropriate "Certificate of Appointment of Corporate Representative" prior to admission. A form of the certificate may be obtained from Computershare or online at www.investorcentre.com under the information tab, "Downloadable forms".

Comments & Questions: If you have any comments or questions for the company, please write them on a separate sheet of paper and return with this form.

Turn over to complete the form

View the annual report, 24 hours a day, 7 days a week:

http://www.peet.com.au

To view or update your securityholding

Your secure access information is:

www.investorcentre.com

PLEASE NOTE: For security reasons it is important that you keep your SRN/HIN confidential.

Change of address. If incorrect, mark this box and make the correction in the space to the left. Securityholders sponsored by a broker (reference number commences with 'X') should advise their broker of any changes.

Proxy Form Please mark to indicate your directions

Appoint a Proxy to Vote on Your Behalf STEP 1

I/We being a member/s of Peet Limited hereby appoint

the ChairmanORof the Meeting	PLEASE NOTE: Leave this box blank ifyou have selected the Chairman of theMeeting. Do not insert your own name(s).
--------------------------------------	--------------------------------------------------------------------------------------------------------------------------------

or failing the individual or body corporate named, or if no individual or body corporate is named, the Chairman of the Meeting, as my/our proxy to act generally at the Meeting on my/our behalf and to vote in accordance with the following directions (or if no directions have been given, and to the extent permitted by law, as the proxy sees fit) at the Annual General Meeting of Peet Limited to be held at the Parmelia Hilton Hotel, 14 Mill Street, Perth, Western Australia on Tuesday, 26 November 2013 at 10:00am (AWST) and at any adjournment or postponement of that Meeting.

Chairman authorised to exercise undirected proxies on remuneration related resolutions:

Where I/we have appointed the Chairman of the Meeting as my/our proxy (or where the Chairman becomes my/our proxy by default), I/we expressly authorise the Chairman to exercise my/our proxy on Resolutions 3, 4, 5 and 7 (except where I/we have indicated a different voting intention below) even though Resolutions 3, 4, 5 and 7 are connected directly or indirectly with the remuneration of a member of key management personnel, which includes the Chairman.

The Chairman of the Meeting intends to vote undirected proxies in favour of each item of business with the exception of Resolution 7 where the Chairman of the Meeting will be voting against.

Important Note: If the Chairman of the Meeting is (or becomes) your proxy you can direct the Chairman to vote for or against or abstain from voting on Resolutions 3, 4, 5 and 7 by marking the appropriate box in step 2 below.

STEP 2

Items of Business PLEASE NOTE: If you mark the Abstain box for an item, you are directing your proxy not to vote on your behalf on a show of hands or a poll and your votes will not be counted in computing the required majority.

The Chairman of the Meeting intends to vote all available proxies in favour of the following resolutions

Resolution 1	Re-election of Stephen Francis Higgs
Resolution 2	Re-election of Anthony James Lennon
Resolution 3	Approval of Peet Limited Performance Rights Plan
Resolution 4	Approval for grant of FY14 Performance Rights under the Peet Limited Performance Rights Plan toBrendan Gore
Resolution 5	Adoption of Remuneration Report
Resolution 6	Appointment of Auditor
resolution	The Chairman of the Meeting intends to vote all available proxies against the following

Resolution 7 Contingent Board spill resolution

For

Against

Abstain

SIGN Signature of Securityholder(s) This section must be completed. Individual or Securityholder 1 Securityholder 2 Securityholder 3 Sole Director and Sole Company Secretary Director Director/Company Secretary Contact Name Contact Daytime Telephone Date / /