REECE LIMITED — AGM Information 2014

Sep 21, 2014

September 19, 2014

Reece Australia Limited

118 Burwood Highway Burwood Victoria 3125 Private Bag 109 Burwood VIC 3125 T 61 3 9274 0000 F 61 3 9274 0197 ABN: 49 004 313 133 www.reece.com.au

The Manager Company Announcement Office Australia Securities Exchange Limited

Dear Sir

Reece Australia Limited

Please find enclosed the Notice of Meeting, Proxy Form and Explanatory Notes for the Reece Australia Limited Annual GeneralMeeting to be held on Thursday, 30th October 2014. These along with the Reece Australia Limited Annual Report have been dispatched to shareholders.

Gavin Street Company Secretary

ABN 49 004 313 133

Dear Shareholder,

ANNUAL GENERAL MEETING

The 2014 Annual General Meeting of Reece Australia Limited is to be held at the Computershare Conference Centre, Yarra Falls, 452 Johnston Street Abbotsford, Victoria on Thursday 30 October 2014 at 3pm (AEDT).

Please find enclosed a Notice of Meeting, Explanatory Notes and Proxy Form for your information.

I will comment briefly on the Company's performance for the financial year ended 30 June 2014. The items of business set out in the Notice of Meeting will then be transacted. Members will have ample opportunity to ask questions of the Board and the Company's Auditor.

I invite you to join the Board members for light refreshments at the conclusion of the meeting.

If you plan to attend the meeting in person, please bring your Proxy Form to facilitate your registration.

Yours sincerely

///kiho

L. Alan Wilson Executive Chairman

NOTICE OF MEETING

The sixty-first Annual General Meeting of the Company will be held at 3pm (AEDT) on Thursday 30 October 2014 at the Computershare Conference Centre, Yarra Falls, 452 Johnston Street Abbotsford, Victoria.

Ordinary Business

• To consider the financial statements for the Company and its controlled entities, together with the statements $11$ and reports of the directors and auditors thereon for the year ended 30 June 2014.
• To consider and, if thought fit, to pass the following resolution as a special resolution in accordance with section 2. 260B(2) of the Corporations Act:

"That, for the purposes of sections 260A and 260B(2) of the Corporations Act and for all other purposes, the Company approves the giving of financial assistance by Actrol Parts Holdings Pty Ltd and each of its wholly owned subsidiaries in connection with the acquisition by the Company of all of the ordinary shares in the capital of Actrol Parts Holdings Pty Ltd, which financial assistance will be constituted by Actrol Parts Holdings Pty Ltd and each of its subsidiaries acceding to the term and revolving facility agreement between the Company and the Commonwealth Bank of Australia dated 23 December 2013, as more particularly described in the Explanatory Notes to this Notice of Meeting."

1. To elect Director

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

"That Mr L. A. Wilson, who retires by rotation in accordance with clause 113 of the Company's Constitution. and who is recommended for re-appointment by the Board, be re-elected as a director of the Company."

1. To elect Director

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

"That Mr A.T. Gorecki, who retires by rotation in accordance with clause 113 of the 'Company's Constitution, and who is recommended for re-appointment by the Board, be re-elected as a director of the Company."

1. To adopt the Remuneration Report

The following non-binding ordinary resolution will be put to the meeting:

"That the Remuneration Report for the financial year ended 30 June 2014 be adopted."

The Company has determined that, for the purposes of voting at the meeting, shares will be taken to be held by those persons recorded on the Company's register at 7.00pm (AEDT) on 28th October 2014.

Members who intend on appointing the Chairman of the Meeting or another member of the Company's key management personnel as their proxy should carefully read the accompanying notes relating to proxies, which among other matters, details the treatment of undirected proxies.

By Order of the Board G.W. Street Company Secretary 19 September 2014

EXPLANATORY NOTES

Ordinary Business

Item 2 - Approval of financial assistance provided by the Actrol Group

Resolution 1 seeks shareholder approval for financial assistance that is proposed to be provided to the Company by Actrol Parts Holdings Pty Ltd (Actrol) and each of its wholly owned subsidiaries in connection with the acquisition by the Company of shares in the capital of Actrol. Resolution 1 is required to be passed as a special resolution.

This item 1 of these Explanatory Notes sets out, in accordance with section 260B(4) of the Corporations Act, all information known to the Company that is material to the decision on how to vote on Resolution 1. As required by section 260B(5) of the Corporations Act, a copy of these Explanatory Notes together with the Notice of Meeting were lodged with the Australian Securities and Investments Commission prior to being dispatched to shareholders.

Background

On 31 January 2014, the Company acquired control of Actrol and its subsidiaries (together, the Actrol Group, and each, an Actrol Group Company) by way of the purchase of 100% of the ordinary share capital in Actrol. The Actrol Group is a specialist industrial wholesale group providing components, units, systems and refrigerant gases to the Australian heating, ventilation, air conditioning and refrigeration ('HVAC-R') industry. Further details regarding the Company's acquisition of the Actrol Group can be found in the Company's ASX announcement of 31 January 2014, including the accompanying presentation.

In order to finance the acquisition of the Actrol Group, the Company entered into a loan facility (Facility) provided to it pursuant to a term and revolving facility agreement (Facility Agreement) with the Commonwealth Bank of Australia (Lender). The Company drew upon approximately $200 million of funds provided to it under the Facility in order to fund the purchase price for the shares in Actrol.

Financial assistance

Under the Facility Agreement, each Actrol Group Member is required to accede to the Facility Agreement by no later than the date that falls 60 days after receiving approval from its shareholders to grant such financial assistance

Section 260A(1) of the Corporations Act restricts a company from financially assisting a person to acquire shares in the company or a holding company of the company. An exemption to this restriction applies in the event that the financial assistance has been approved by shareholders of the company under section 260B(1) of the Corporations Act. Additionally, where the company providing the financial assistance will, immediately after the relevantacquisition of shares in relation to which the financial assistance is provided, be a subsidiary of a listed dome corporation, the provision of the financial assistance by the company is also required to be approved by shareholders of that listed domestic corporation.

The accession by each Actrol Group Member to the Facility Agreement will constitute the provision of financial assistance by each Actrol Group Member, given that, in so doing, each will become a guarantor of the Company's obligations under the Facility Agreement. As the Company entered into and relied upon the Facility Agreement in order to finance the acquisition of the shares in Actrol, and it is a material term of the Facility Agreement that each Actrol Group Member accedes to the Facility Agreement in the capacity as guarantor of the Company's obligations thereunder, the accession by each Actrol Group Member to the Facility Agreement will constitute the provision of financial assistance which, without the receipt of required shareholder approvals, would be prohibited under the Corporations Act.

Approval

Consequently, the shareholders of each Actrol Group Member have passed resolutions to approve the provision by each Actrol Group Member of the financial assistance constituted by its accession to the Facility Agreement

Additionally, given that each Actrol Group Member is, and will remain following its accession to the Facility Agreement, a subsidiary of the Company (which is itself a listed domestic corporation), the financial assistance which each Actrol Group Member proposes to provide to the Company must, in accordance with section 260B(2) of the Corporations Act, also be approved by a special resolution of the Company's shareholders. Resolution 1 is being proposed for this purpose.

Consequences of financial assistance

As outlined above, the financial assistance is being provided by each Actrol Group Member to allow the Company to comply with its requirements under the Facility Agreement.

The effect of each Actrol Group Member providing the financial assistance described above is that each will become liable for all amounts payable by the Company under the Facility Agreement and will also become subject to restrictions on its ability to grant security over or dispose of its assets or incur further financial indebtedness. Additionally, by acceding to the Facility Agreement, each Actrol Group Member will provide certain representations and warranties and give certain undertakings to the Lender. Those representations, warranties and undertakings reflect those which are customarily provided by borrowers and quarantors entering into agreements in the nature of the Facility Agreement.

Reece Australia Limited A.B.N. 49 004 313 133 Registered Office: 118 Burwood Highway, Burwood, Victoria, 3125

As each Actrol Group Member is (whether directly or indirectly) a wholly owned subsidiary of the Company and the Company is already liable for the obligations under the Facility Agreement for which each Actrol Group Member is, by its accession to the Facility Agreement, assuming liability in relation to, the provision of the financial assistance described above is unlikely to adversely affect the Company.

As such, the directors of the Company are of the belief that the provision by each Actrol Group Member of the financial assistance described above is in the best interests of the Company.

Recommendation

The directors of the Company unanimously recommend that shareholders vote in favour of Resolution 1.

Item 3 - Re-election of Director

Re-election of Mr L.A. Wilson

Name:	Mr Leslie Alan Wilson
Age:	73
Position:	Executive Chairman
Experience:	Appointed to the board in 1969. General Manager from 1970 to 1974. Managing Director from1974 to 2008. Deputy Chairman from 1973 to 2001. Appointed Chairman in 2001.

The directors (excluding Mr L.A. Wilson) recommend that shareholders vote in favour of this resolution.

Item 4 - Re-election of Director

Re-election of Mr A.T. Gorecki

Name:	Mr Andrzej Tomasz Gorecki

Age: 59

• Position: Non-Executive Director
• Experience: Appointed to the board March 2008. Managing Director of I.T. company Retail Directions. No other directorships of listed companies.

The directors (excluding Mr A.T. Gorecki) recommend that shareholders vote in favour of this resolution.

Item 5 - Adoption of Remuneration Report

In accordance with the requirements of the Corporations Act 2001 (Cth) (the "Act") the Board submits its Remuneration Report for the financial year ended 30 June 2014 to members for consideration and adoption.

The Remuneration Report is included in the Directors' Report contained in the 2014 Annual Report.

As provided for in the Act, the vote on this resolution is advisory only and does not bind the directors or the Company. The Board will, however, take the outcome of the vote into consideration when reviewing remuneration practices and policies.

A reasonable opportunity will be provided to ask questions about, or to make comments on, the Remuneration Report at the meeting.

The directors recommend that members vote in favour of the resolution for the adoption of the Remuneration Report.

Notes relating to proxies

• $\mathbf{1}$ The Company has determined that, for the purposes of voting at the meeting, shares will be taken to be held by those persons recorded on the Company's register at 7.00pm (AEDT) on 28th October 2014.
• A member entitled to attend and vote at this meeting is entitled to appoint not more than two proxies (who $\overline{2}$ need not be members of the Company) to attend and vote in the member's place. Where a member appoints more than one representative, proxy or attorney, those appointees are entitled to vote on a poll but not on a show of hands.
• $\mathbf{R}$ A member who appoints two proxies may specify a proportion or number of the member's votes each proxy is appointed to exercise. A single proxy exercises all the member's votes.
• $\overline{4}$ . Proxy forms may be delivered in person, by mail or by fax to the Share Registry's office as follows:

In person: Computershare Investor Services Pty Limited Yarra Falls 452 Johnston Street Abbotsford Victoria, 3067, Australia

• By mail: Computershare Investor Services Pty Limited GPO Box 242 Melbourne Victoria, 3001, Australia
• By fax: 1800 783 447 (within Australia) +61 3 9473 2555 (outside Australia)
• 1. Proxy forms may also be lodged online by visiting www.investorvote.com.au
• Custodians may lodge their proxy forms online by visiting www.intermediaryonline.com 6.
• $\overline{7}$ For all enquiries call: 1300 850 505 (within Australia)

+61 3 9415 4000 (outside Australia)

TO BE EFFECTIVE PROXY FORMS MUST BE RECEIVED BY 3.00PM (AEDT) ON TUESDAY 28TH OCTOBER 2014.

Item 5 - Voting Exclusion Statement

The Company will disregard any votes cast (in any capacity) on Item 5 by or on behalf of:

• $a)$ Key management personnel of the Company group ("KMP"); and
• b) Closely related parties of the KMP.

The KMP of the Company group are set out in the Remuneration Report. A "closely related party" includes a spouse, dependant and certain other close family members of KMP, as well as any companies controlled by a member of KMP.

However, the Company need not disregard a vote cast on Item 5 by a KMP or a closely related party of a KMP if the vote is not cast on behalf of a person who is a KMP or a closely related party of a KMP and:

• It is cast as a proxy appointed in writing for a person who is entitled to vote on Item 5, the proxy is a directed $a)$ proxy (that is, the proxy specifies how the proxy is to vote on the proposed resolution) and it is voted in accordance with the directions on the form, or
• It is cast by the person chairing the meeting as proxy for a person who is entitled to vote and the proxy $b)$ appointment expressly authorises the Chairman to exercise the proxy even if the resolution is connected, directly or indirectly, with the remuneration of the KMP.

For shareholders who have not elected to receive a hard copy of the Company's 2014 Annual Report, a copy can be viewed or downloaded from the Company's website at the following address: www.reece.com.au/investors.

$\vdash$ 000001 000 REH MR SAM SAMPLE FLAT 123 123 SAMPLE STREET SAMPLE ESTATE SAMPLEVILLE VIC 3030

Lodge your vote:

$\square$ Online: www.investorvote.com.au

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

Vote and view the annual report online

.Go to www.investorvote.com.au or scan the QR Code with your mobile device. . Follow the instructions on the secure website to vote.

Your access information that you will need to vote:

Control Number: 999999

SRN/HIN: 19999999999 PIN: 99999

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

红 For your vote to be effective it must be received by 3:00pm (AEDT) on Tuesday 28 October 2014

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 or abstain as they choose (to the extent permitted by law). 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 for Postal Forms

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 help tab, "Printable 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.

The Chairman of the Meeting intends to vote undirected proxies in favour of each item of business.

In exceptional circumstances, the Chairman of the Meeting may change his/her voting intention on any resolution, in which case an ASX announcement will be made.

Securityholder 2		Securityholder 3
Director
	ContactDaytimeTelephone
			Date	Director/Company Secretary