THIS DOCUMENT IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION

If you are in any doubt as to the action you should take you should immediately seek advice from your stockbroker, bank manager, solicitor, accountant or other independent professional advisor duly authorised under the Financial Services and Markets Act 2000.

If you have sold or otherwise transferred all of your shares in SIG plc, please forward this document and the Form of Proxy as soon as possible to the purchaser or transferee or to the stockbroker, bank or other agent through whom the sale or transfer was effected, for transmission to the purchaser or transferee.

SIG plc

(Registered in England No. 998314)

Chairman's Letter to Shareholders and Notice of General Meeting

The General Meeting is to be held at the offices of Herbert Smith Freehills LLP, Exchange House, Primrose Street, London, EC2A 2EG on Wednesday 7 November 2018 at 12 noon

The Notice of General Meeting is set out on page 12 of this Document. A Form of Proxy for use at the General Meeting is enclosed.

(Registered in England No. 998314)

DIRECTORS:

Andrew Allner (Non-executive Chairman) Meinie Oldersma (Chief Executive Officer) Nick Maddock (Chief Financial Officer) Alan Lovell (Senior Independent Non-executive Director) Andrea Abt (Independent Non-executive Director) Janet Ashdown (Independent Non-executive Director) Ian Duncan (Independent Non-executive Director) Cyrille Ragoucy (Independent Non-executive Director)

REGISTERED OFFICE:

10 Eastbourne Terrace London W2 6LG

15 October 2018

Dear Shareholder

GENERAL MEETING

I am writing to explain the background to and reasons for SIG plc (the "Company") convening a General Meeting ("GM") seeking shareholder approval for certain changes to incentive arrangements for the Executive Directors and other Key Executives of the Company.

The GM will be held on 7 November 2018 at the offices of Herbert Smith Freehills LLP, Exchange House, Primrose Street, London, EC2A 2EG at 12 noon. The Notice convening the GM is set out on page 12 of this document.

As noted in the Remuneration Committee Report contained in the Company's Annual Report and Accounts for the financial year ended 31 December 2017 (the "Annual Report"), at the time of publication of the Annual Report, the Remuneration Committee was conducting a review of the incentive arrangements for the Executive Directors and other Key Executives of the Company and was consulting extensively with the Company's main shareholders and the main shareholder representative bodies in order to agree the appropriate remuneration approach to support the strategy of the Company. This dialogue was ongoing at the time of the 2018 AGM and therefore it was inappropriate to bring a new Remuneration Policy and Incentive Plans to a shareholder vote at this meeting. The Remuneration Committee has now completed its consultation exercise and is keen to ensure that the new remuneration strategy is in place as soon as possible to support the business strategy given that no LTIP award has been made this year.

A summary of the Resolutions to be proposed at the GM is set out below, and a letter from the Chair of the Remuneration Committee, Janet Ashdown, follows which provides further details on the background to, and reasons for, the proposals.

THE RESOLUTIONS

Resolution 1 – Approval of Directors' Remuneration Policy (ordinary resolution)

Resolution 1 seeks approval of the Company's future Directors' Remuneration Policy which if approved will take effect from the conclusion of the GM. A letter and accompanying schedules from the Chair of the Remuneration Committee setting out details on the structure and rationale for the new incentive plans in the proposed Directors' Remuneration Policy can be found on pages 4 to 11 of this document. The Directors' Remuneration Policy incorporates these new incentive plans, and has also been updated for developments in best practice, including revisions to the UK Corporate Governance Code published in July 2018. The proposed Directors' Remuneration Policy can be found in Appendix 1 to the GM notice.

Resolution 2 – Approval of the SIG plc Bonus Plan (the "Bonus Plan") (ordinary resolution)

Resolution 2 seeks approval of the SIG plc Bonus Plan, the principal terms of which are set out in Appendix 2 to the GM notice and which is a key component of the proposed Directors' Remuneration Policy.

Resolution 3 – Approval of the SIG plc 2018 Long Term Incentive Plan (the "LTIP") (ordinary resolution)

Resolution 3 seeks approval of the SIG plc 2018 Long Term Incentive Plan, the principal terms of which are set out in Appendix 2 to the GM notice and which is a key component of the proposed new Directors' Remuneration Policy.

RECOMMENDATION AND ACTION TO BE TAKEN

The Board considers that all the Resolutions set out in the Notice of General Meeting are likely to promote the success of the Company and are in the best interests of the Company and its Shareholders as a whole. The Directors unanimously recommend that you vote in favour of the proposed Resolutions as they intend to do in respect of their personal shareholdings in the Company, which, in aggregate, amount to 142,530 shares representing 0.02% of the issued ordinary share capital of the Company.

Whether or not you are able to attend the GM, your vote is still important and I would encourage you, regardless of the number of shares you own, to complete, sign and return the Form of Proxy so as to reach the Company's Registrars, Computershare Investor Services PLC, The Pavilions, Bridgwater Road, Bristol, BS99 6ZY, not less than 48 hours (business days) before the time fixed for the holding of the GM. Alternatively, Shareholders may also register their proxy appointment and voting instructions electronically. Please refer to the notes on pages 12 to 13 of this Notice for further details on how to appoint a proxy and vote electronically. The completion and return of a Form of Proxy will not prevent you from attending and voting in person at the GM if you so wish.

Yours faithfully

Andrew Allner Chairman

15 October 2018

Dear Shareholder,

DIRECTORS' REMUNERATION POLICY

Introduction

I am writing to you in my capacity as Chair of the Remuneration Committee of the Company ("the Committee"). In this letter and the attached schedules I have set out the background, detailed terms and conditions and rationale behind the new incentive plans. The Directors' Remuneration Policy incorporates these new incentive plans and the Remuneration Committee has also taken the opportunity to update the Policy for developments in best practice, including the revisions to the UK Corporate Governance Code published in July 2018. The full Directors' Remuneration Policy can be found in Appendix 1 to this Notice of Meeting enclosed with this letter.

Background

The Company has been through a turbulent period over the last few years which has seen the make-up of its Board change significantly. A new management team has now articulated the Company's new plan at the Group's Strategy Day in November 2017 and has begun the execution of this plan.

It is the view of the Board that the key measure of the success of the implementation of the strategy over the next period will be the generation of substantial and sustained total shareholder return. The Board is under no illusion that the Company is in a turnaround situation.

The Board believes that in the CEO and CFO they have a highly entrepreneurial team who have the skills necessary to implement the strategy and achieve a turn-around in the Company's performance.

The Committee has thought hard about the appropriate way to incentivise the CEO, CFO and our core Key Executives to deliver the strategy over the next period. Any incentive arrangement needs to deal with the following challenges:-

y Strategy implementation is not linear and priorities change over the period therefore setting targets on the grant of a standard 3 year LTIP is extremely challenging as they may not be the right targets during the performance period;
y The nature of the strategy implementation may result in the need to constantly adjust performance conditions during the standard 3 year LTIP performance period; this process makes the targets and their satisfaction opaque to all stakeholders including the participants and shareholders;
y It is the Board's view that the key output of the effective implementation of the strategy is substantial and sustained total shareholder return. The Board does not feel it is appropriate given the current position of the Company to reward Executives for the delivery of objectives which do not result in this;
y There is a substantial risk of failure for the Executives given the unsuccessful attempts to turnaround the Company in the past; the Committee is therefore keen to ensure that there is sufficient upside reward to balance this risk;
y Any incentive arrangement needs to incentivise and retain a highly entrepreneurial CEO and CFO. It is the Committee's view that it is essential to lock in and incentivise the new Executives over the next period to enable them to implement the strategic plan and generate sustainable long-term returns for shareholders. In the Committee's opinion the best way to measure the new Executives' success is to quantify the output of the new strategy in maximising the long-term sustainable value of the business through the delivery of absolute shareholder return.

The Committee are also aware of the changes to the recently updated UK Corporate Governance Code. The Committee has monitored the updates with interest and is comfortable that the changes to the Company's Remuneration Policy and Incentive Plans set out in this Notice are in line with the Code's updated provisions in relation to remuneration.

Shareholder Consultation

The Committee has consulted extensively with shareholders and the main shareholder representative bodies on the proposals contained in this Notice and the original proposals were changed materially as a result of the feedback received. The original approach of a value sharing plan proposed by the Committee was changed to the current proposals due to a desire by a number of the Company's shareholders to see an approach more in line with a standard FTSE 250 Bonus Plan and LTIP with a reduced potential quantum compared to the original value sharing plan. Whist the majority of shareholders recognised the Company was in a recovery stage and therefore a leveraged plan focused on driving absolute total shareholder return would be appropriate; there was a view that there should be a number of comparative and absolute underpins to any plan using this measure. All shareholders supported the Committee's desire for an incentive approach resulting in the longterm build-up and retention of material shareholdings by the Executive Directors.

At the end of the consultation exercise the majority of shareholders consulted (both by issued capital and number) were supportive of the Remuneration Policy and Incentive Plans set out in this Notice.

The new Incentive Plans meet the Committee's objectives set out above and address the points raised during the shareholder consultation.

Objective	Bonus Plan	LTIP
Simple Measurement of Success	The Committee will use the bonus to set short-term financial, strategic and operational performance conditions. This is designed to ensure that the Executive Directors are incentivised to make the correct decisions today to ensure the long term sustainable future for the Company.	The primary performance condition for the LTIP is absolute TSR. Therefore, if the value of the Company increases the Executive Directors will receive their LTIP award (subject to the safeguards built around the gateway conditions).
	Ensures the majority of the value that Executive Directors receive will be dependent on whether the operational changes and short term financial performance for which the bonus was earned flows through to long-term sustainable shareholder value; which will be reflected in the share price and therefore the ultimate value of the deferred shares awarded to the Executive Directors.
	Ensures a meaningful amount of the overall incentive opportunity is focused on delivering the financial performance of the Company; recognising the challenge of using the LTIP for this purpose given the requirement to set multi-year performance targets and the lack of visibility.
Substantial and sustained total shareholder return	56% of the proposed maximum bonus will be payable in shares which will not be fully vested and released to participants for five years.	No LTIP award will be earned unless absolute TSR performance targets are met.
	This results in a material long-term locked in shareholding for the Executive Directors ensuring they share the same ownership experience as other shareholders over this period.	To ensure that this is a comparatively strong level of performance comparative TSR performance conditions will have to be satisfied.
		To ensure that TSR is not at the expense of financial stability a ROCE performance condition has to be satisfied.
Lock-in & Retention	56% of the proposed maximum bonus is provided in long term shares earned on an annual basis. This means for new Executive Directors that they have the potential to build up a material locked in shareholding in a short period of time.	Shares under the LTIP will not be full vested and released to participants for five years providing a long-term lock-in of participants.
	This shareholding will provide alignment with shareholders' interests and a retentive effect.	This is supported by a market leading level of minimum shareholding requirement of 300% of salary.
	The long tail of shares from the operation of the Bonus Plan:- • Provides a strong retentive component; and • Encourages long-term thinking from the Executive Directors to ensure that the foundations build are maintained over the longer term and past their departure from the Company.
Risk vs. Reward	The Committee has set a total incentive opportunity at a maximum of 450% of salary. This has been set in the upper quartile for the FTSE 250 to provide a substantial reward to the entrepreneurial Executive Directors if they deliver above upper quartile absolute and comparative performance.

Yours faithfully

JANET ASHDOWN CHAIR OF THE REMUNERATION COMMITTEE

OVERVIEW OF THE INCENTIVE PLANS

BONUS PLAN: CORE TERMS

There will be minimal change to the core terms and operation of the annual bonus apart from the following:

y The maximum annual award will be increased from 100% of salary to 150% of salary.
y Current annual cash opportunity of 66.7% of salary will be maintained such that this will equate to 44% of the maximum bonus opportunity being paid in cash, with 56% of the maximum bonus earned deferred into shares for 3 years. These shares will be subject to an additional two year holding period post vesting.
y Therefore the full 50% of salary increase in opportunity will be payable in deferred shares.
y Performance measures will remain unchanged:-
▸ 50% Profit before Tax ("PBT");
▸ 50% Return on Capital Employed ("ROCE");
▸ Any bonus is subject to a health and safety gateway which has to be met before any bonus can be earned.

LTIP: CORE TERMS

The LTIP provides the following incentive approach:-

y The Company makes annual grants of shares which have the following terms and conditions:-
▸ Maximum Initial Award is 200% of salary;
y The Initial Award will vest at the end of a three year performance period provided that:-
▸ The participant remains employed at this date; and
▸ The Primary Performance Conditions are satisfied;
y The maximum Initial Award can be enhanced on vesting if the Multiplier Performance Condition is fully met by 50% giving a total potential grant value under the LTIP of 300% of salary.
y All shares earned as a result of the satisfaction of the Primary Performance Condition and the Multiplier Performance Condition are subject to a two year holding period following the three year performance period (shares can be sold to meet any tax liability during the holding period).

OTHER LTIP TERMS

Set out below are the Primary Performance Conditions. There are two gateways that need to be achieved as part of these conditions which have been designed to ensure that appropriate levels of financial and relative performance have been achieved:-

y Median TSR performance against the FTSE 250 (excl. Investment Trusts);
y An average ROCE over the 3 year performance period of 10% p.a.;

Once these gateways have been achieved, the vesting of the Initial Award will be determined based on the Company's absolute TSR performance:-

Absolute TSR Growth	Vesting Level of Initial Award
Below 8% p.a.	Nil
8% p.a.	25%
14% p.a. or above	100%

Straight line vesting between 8% p.a. and 14% p.a.

The Multiplier Performance Condition is based on the Company's absolute TSR performance over the period with a gateway requiring the Company to have achieved:-

y Upper quartile TSR performance against the FTSE 250 (excl. Investment Trusts) over the three year performance period for any enhancement of the Initial Award;
y An average ROCE over the 3 year performance period of 12.5% p.a.;

Once these gateways have been achieved, the following table shows the absolute TSR performance condition and the multiply factor on the Initial Award:-

Absolute TSR Growth	Multiplier
Below 14% p.a.	1.0
14% p.a.	1.0
18% p.a. or above	1.5
Straight line multiplier between 14% p.a. and 18% p.a.

The starting share price for the absolute total shareholder return performance condition will be the higher of:-

y The share price on shareholder approval of the new Remuneration Policy and Incentive Plans at the 2018 GM; and
y the historical share price average over the period ending on the date of the GM and starting on the date since which a number of shares equal to the Company's issued share capital have been traded on the London Stock Exchange.

For the avoidance of doubt, there will be no further awards granted under the 2014 Long Term Incentive Plan, the Company's current long term incentive arrangement, on shareholder approval of the new Bonus Plan and LTIP.

SCHEDULE 1 TO THE CHAIR OF REMUNERATION COMMITTEE'S LETTER – SUMMARY OF THE KEY TERMS OF THE SIG PLC BONUS PLAN (THE "BONUS PLAN")

The following table sets out the key terms of the Bonus Plan:-

Element	Bonus Plan
Cessation of Employment	Good Leaver	Bad Leaver	Discretion
	For the year of cessation The Committee will determine a pro-rated bonus based on the performance over the full year. Bonuses will be paid in the normal manner (part cash part deferred shares). Subsisting Deferred Share Awards Awards will vest on their original vesting dates. On cessation of employment holding periods will continue to apply.	For the year of cessation No bonus will be earned for the year of cessation. Subsisting Deferred Share Awards Lapse of any unvested awards. Awards subject to holding periods will be retained with the shares released at the end of these periods.	The Committee has the following elements of discretion: y to determine that an executive is a good leaver. It is the Committee's intention to only use this discretion in circumstances where there is an appropriate business case which will be explained in full to shareholders. y to measure performance over the original performance period or at the date of cessation. The Committee will make this determination depending on the type of good leaver reason resulting in the cessation; y to vest the award at the end of the vesting period or at the date of cessation. The Committee will make this determination depending on the type of good leaver reason resulting in the cessation; y to determine whether the holding period will apply including whether in full or in part.
	y	A good leaver reason is defined as cessation in the following circumstances:	death; ill-health; injury or disability; redundancy; retirement (in agreement with the Company); employing company ceasing to be a Group company; transfer of employment to a company which is not a Group company; and
	y	dishonesty, fraud, misconduct or other circumstances justifying summary dismissal.	any reason, permitted by the Committee in its absolute discretion in any particular case except where termination is for
			Cessation of employment in circumstances other than those set out above is cessation for other reasons.
Change of Control	For the year of cessation The Committee will determine a pro-rated bonus based on the performance to the date of the change of control. This bonus will be paid in cash and/or shares at the discretion of the Committee.
		The Committee has discretion regarding whether to pro-rate the bonus to time. The Committee's normal policy is that it will pro-rate the bonus for time. It is the Committee's intention to use its discretion to not pro-rate in circumstances only where there is an appropriate business case which will be explained in full to shareholders.
	Subsisting Deferred Share Awards Awards will vest on the change of control.
	Any holding periods will finish on the date of the change of control.
Dilution	The Plan will operate standard IA dilution limits.
Variation in Capital	Standard variation of capital clauses.
Malus & Clawback	Market practice malus and clawback provisions will apply.
	Trigger events will be:-
	y	discovery of a material misstatement resulting in an adjustment in the audited consolidated accounts of the Company or the audited accounts of any Group Member; and/or
	y misleading information; and/or		the assessment of any performance condition or target in respect of a payment was based on error, or inaccurate or
	y information; and/or	the discovery that any information used to determine the payment was based on error, or inaccurate or misleading
	y misbehaviour, fraud or gross misconduct;		action or conduct of a participant which, in the reasonable opinion of the Committee, amounts to employee
	y	failure of risk management and / or corporate failure; and/or
	y damage is attributable to him.		events or behaviour of a participant have led to the censure of a Group Member by a regulatory authority or have had a significant detrimental impact on the reputation of any Group Member provided that the Board is satisfied that the relevant participant was responsible for the censure or reputational damage and that the censure or reputational
	deferred shares.		Malus will operate up to the time of payment for cash awards. Malus will operate throughout the vesting periods for deferred shares. Clawback will apply for 2 years following the payment of any cash bonus and for the two year holding period on

SCHEDULE 2 TO THE CHAIR OF REMUNERATION COMMITTEE'S LETTER – SUMMARY OF THE KEY TERMS OF THE SIG PLC 2018 LONG TERM INCENTIVE PLAN (THE "LTIP")

The following table sets out the key terms of the LTIP:-

Element	Enhanced LTIP
Cessation of Employment	Good Leaver	Bad Leaver	Discretion
	Pro-rated to time and performance in respect of each subsisting LTIP award.	Lapse of any unvested LTIP awards.	The Committee has the following elements of discretion: y to determine that an executive is a good leaver. It is the Committee's intention to only use this discretion in circumstances where there is an appropriate business case which will be explained in full to shareholders;
			y to measure performance over the original performance period or at the date of cessation. The Committee will make this determination depending on the type of good leaver reason resulting in the cessation;
			y to vest the LTIP award at the end of the original performance period or at the date of cessation. The Committee will make this determination depending on the type of good leaver reason resulting in the cessation;
			y to determine whether the holding period will apply including whether in full or in part; and
			y to determine whether to pro-rate the maximum number of shares to the time from the date of grant to the date of cessation. The Committee's normal policy is that it will pro-rate awards for time. It is the Committee's intention to use discretion to not pro-rate in circumstances where there is an appropriate business case which will be explained in full to shareholders.
		A good leaver reason is defined as cessation in the following circumstances:
	y		death; ill-health; injury or disability; redundancy; retirement (in agreement with the Company); employing company ceasing to be a Group company; transfer of employment to a company which is not a Group company; and
	y		any reason, permitted by the Committee in its absolute discretion in any particular case except where termination is for dishonesty, fraud, misconduct or other circumstances justifying summary dismissal.
			Cessation of employment in circumstances other than those set out above is cessation for other reasons.
Change of Control			The number of shares subject to subsisting LTIP awards will vest on a change of control, pro-rated to time and performance.
			The Committee has discretion regarding whether to pro-rate the LTIP awards to time. The Committee's normal policy is that it will pro-rate the LTIP awards for time. It is the Committee's intention to use its discretion to not pro-rate in circumstances only where there is an appropriate business case which will be explained in full to shareholders.
Dilution	The Plan will operate standard IA dilution limits.
Variation in Capital	Standard variation of capital clauses.
Malus & Clawback	Trigger events will be:- y	Market practice malus and clawback provisions will apply. the audited accounts of any Group Member; and/or	discovery of a material misstatement resulting in an adjustment in the audited consolidated accounts of the Company or
	y the assessment of any performance condition or target in respect of a payment was based on error, or inaccurate or misleading information; and/or
	y the discovery that any information used to determine the payment was based on error, or inaccurate or misleading information; and/or
	y action or conduct of a Participant which, in the reasonable opinion of the Committee, amounts to employee misbehaviour, fraud or gross misconduct;
	y failure of risk management and / or corporate failure; and/or
	y events or behaviour of a Participant have led to the censure of a Group Member by a regulatory authority or have had a significant detrimental impact on the reputation of any Group Member provided that the Board is satisfied that the relevant Participant was responsible for the censure or reputational damage and that the censure or reputational damage is attributable to him.
			Malus will operate throughout the LTIP vesting periods. Clawback will apply for 2 years following the vesting of awards.

SCHEDULE 3 TO THE CHAIR OF REMUNERATION COMMITTEE'S LETTER – ILLUSTRATIVE MODELLING OF THE COST AND BENEFITS OF THE BONUS PLAN AND LTIP

Assumptions

To illustrate the impact of the proposed Bonus Plan and LTIP, the table and charts below show the potential pay-outs of the incentive arrangements for various TSR growth and vesting assumptions:-

TSR Growth p.a.	LTIP Initial award vesting	LTIP (Multiplier of Initial award)	Annual Bonus pay-out (% of max)*
8%.	25%	1.00	60%
14%	100%	1.00	80%
16%	100%	1.25	100%
18%	100%	1.50	100%

* The bonus payout assumptions are independent from the TSR growth as TSR is not a bonus performance condition.

Potential Benefits

The table below shows the potential pay-outs to the CEO and CFO in comparison to the value created for shareholders. The pay-outs include three full cycles of the LTIP vesting in 2021, 2022 and 2023, Bonus Plan awards from 2019 including cash pay-outs from 2019 onwards and deferred element vesting from 2022 onwards:-

8% p.a. TSR growth	2018	2019	2020	2021	2022	2023	Total
Market Cap (£000s)	887,322	958,308	1,034,972	1,117,770	1,207,192	1,303,767	n/a
Market Cap created in year (£000s)	n/a	70,986	76,665	82,798	89,422	96,575	416,445
Payouts – CEO (£000s)
Proposed LTIP	0	0	0	358	358	358	1,074
Proposed Bonus	0	341	341	341	556	556	2,135
Total	0	341	341	699	914	914	3,209
Payouts – CFO (£000s)
Proposed LTIP	0	0	0	230	230	230	690
Proposed Bonus	0	219	219	219	357	357	1,372
Total	0	219	219	449	587	587	2,063

14% p.a. TSR growth	2018	2019	2020	2021	2022	2023	Total
Market Cap (£000s)	887,322	1,011,547	1,153,164	1,314,607	1,498,652	1,708,463	n/a
Market Cap created in year (£000s)	n/a	124,225	141,617	161,443	184,045	209,811	821,141
Payouts - CEO (£000s)
Proposed LTIP	0	0	0	1,684	1,684	1,684	5,053
Proposed Bonus	0	379	379	379	828	828	2,793
Total	0	379	379	2,063	2,512	2,512	7,846
Payouts – CFO (£000s)
Proposed LTIP	0	0	0	1,083	1,083	1,083	3,248
Proposed Bonus	0	244	244	244	532	532	1,795
Total	0	244	244	1,326	1,615	1,615	5,044

SCHEDULE 3 continued

16% p.a. TSR growth	2018	2019	2020	2021	2022	2023	Total
Market Cap (£000s)	887,322	1,029,294	1,193,980	1,385,017	1,606,620	1,863,679	n/a
Market Cap created in year (£000s)	n/a	141,972	164,687	191,037	221,603	257,059	976,357
Payouts – CEO (£000s)
Proposed LTIP	0	0	0	2,218	2,218	2,218	6,654
Proposed Bonus	0	379	379	379	1,118	1,118	3,373
Total	0	379	379	2,597	3,336	3,336	10,027
Payouts – CFO (£000s)
Proposed LTIP	0	0	0	1,426	1,426	1,426	4,278
Proposed Bonus	0	244	244	244	719	719	2,169
Total	0	244	244	1,669	2,145	2,145	6,446

18% p.a. TSR growth	2018	2019	2020	2021	2022	2023	Total
Market Cap (£000s)	887,322	1,047,040	1,235,507	1,457,898	1,720,320	2,029,978	n/a
Market Cap created in year (£000s)	n/a	159,718	188,467	222,391	262,422	309,658	1,142,656
Payouts – CEO (£000s)
Proposed LTIP	0	0	0	2,802	2,802	2,802	8,405
Proposed Bonus	0	379	379	379	1,157	1,157	3,451
Total	0	379	379	3,181	3,959	3,959	11,856
Payouts – CFO (£000s)
Proposed LTIP	0	0	0	1,801	1,801	1,801	5,403
Proposed Bonus	0	244	244	244	744	744	2,219
Total	0	244	244	2,045	2,545	2,545	7,622

SCHEDULE 3 continued

The charts below show the total pay-outs from the cash element of the Bonus, the 2022 and 2023 vesting of the deferred element of the Bonus Plan and three full cycles of the LTIP vesting in 2021, 2022 and 2023 i.e. total incentives pay-outs from the proposals over 2018 to 2023. We also set out the historic likelihood of achieving the TSR growth levels illustrated which is based on FTSE 250 companies' performance (excluding investment trusts) over the past three years:

CEO – Total Incentive payouts (2018 – 2023)

SIG PLC NOTICE OF A GENERAL MEETING

Notice is hereby given that a General Meeting of the members of SIG plc ("the Company") will be held on 7 November 2018 at 12 noon at the offices of Herbert Smith Freehills LLP, Exchange House, Primrose Street, London, EC2A 2EG to consider and, if thought fit, to pass the following resolutions as ordinary resolutions.

1. That the Directors' Remuneration Policy as set out in Appendix 1 to this Notice of Meeting be and is approved.
1. That:
(a) the SIG plc Bonus Plan (the "Bonus Plan"), the principal terms of which are summarised in Appendix 2 to this Notice of Meeting and the rules of which are produced at the Meeting and for the purposes of identification initialled by the Chairman, is approved and that the Directors are authorised to do all acts and things which they may consider necessary or expedient to carry the Bonus Plan into effect; and
(b) the Directors are authorised to establish such further plans based on the Bonus Plan or schedules to the Bonus Plan as they consider necessary or desirable but which have been 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 or schedules are treated as counting against any limits on individual or overall participation in the Bonus Plan.
1. That:
(a) the SIG plc 2018 Long Term Incentive Plan (the "LTIP"), the principal terms of which are summarised in Appendix 2 to this Notice of Meeting and the rules of which are produced at the Meeting and for the purposes of identification initialled by the Chairman, is approved and that the Directors are authorised to do all acts and things which they may consider necessary or expedient to carry the LTIP into effect; and
(b) the Directors are authorised to establish such further plans based on the LTIP or schedules to the LTIP as they consider necessary or desirable but which have been 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 or schedules are treated as counting against any limits on individual or overall participation in the LTIP.

By Order of the Board

RICHARD MONRO

SECRETARY

15 October 2018

Registered Office: 10 Eastbourne Terrace London W2 6LG

NOTES:

1. A member entitled to attend and vote at the aforementioned meeting is entitled to appoint one or more proxies to exercise all or any of his/her rights to attend, speak and vote at the General Meeting (the "Meeting"). A member can appoint more than one proxy in relation to the Meeting, provided that each proxy is appointed to exercise the rights attaching to different shares held by him/her.
1. A proxy need not also be a member of the Company but must attend the Meeting in person. A Form of Proxy may accompany this Notice of General Meeting and the notes to the Form of Proxy set out the details of how to appoint a proxy.
1. A copy of this Notice has been sent for information only to persons who have been nominated by a member to enjoy information rights under Section 146 of the Companies Act 2006 (a "Nominated Person"). The rights to appoint a proxy cannot be exercised by a Nominated Person: they can only be exercised by the member. However, a Nominated Person may have a right under an agreement between him/her and the member by whom he/she was nominated to be appointed as a proxy for the Meeting or to have someone else so appointed. If a Nominated Person does not have such a right or does not wish to exercise it, he/she may have a right under such an agreement to give instructions to the member as to the exercise of voting rights.
1. To appoint a proxy or proxies Shareholders must complete: (a) the Form of Proxy and return it, together with the power of attorney or other authority (if any) under which it is signed, or a certified copy of the same to Computershare Investor Services PLC, The Pavilions, Bridgwater Road, Bristol, BS99 6ZY, or by using the reply-paid envelope provided; or (b) a CREST proxy instruction as detailed below; or (c) an online proxy appointment at www. eproxyappointment.com (you will need your unique PIN and Shareholder Reference Number, together with the Control number, printed on the Form of Proxy), in each case so that it is received no later than 12 noon on 5 November 2018. The appointment of a proxy will not preclude a member from attending and voting in person. If a member attends the Meeting in person, his proxy appointment will automatically be terminated.
1. A member may change proxy instructions by returning a new proxy appointment using the methods set out above. Where a member has appointed a proxy using the hard-copy Form of Proxy and would like to change the instructions using another hard- copy proxy form, please contact Computershare Investor Services PLC, The Pavilions, Bridgwater Road, Bristol, BS99 6ZY. The deadline for receipt of proxy appointments in paragraph 4 above also applies in relation to amended instructions. Any attempt to terminate or amend a proxy appointment received after the relevant deadline will be disregarded. Where two or more valid separate appointments of proxy are received in respect of the same share in respect of the same Meeting, the one which is last sent shall be treated as replacing and revoking the other or others. In the case of joint holders, where more than one of the joint holders purports to appoint a proxy, 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 name being the most senior).
1. In conjunction with its Registrars, the Company has in place a facility to allow each Shareholder to register proxy votes electronically. Detailed information of how to do this is set out on the Form of Proxy. A member can register proxy votes electronically by either logging on to the Registrars' website, www. eproxyappointment.com and following the instructions, or CREST members may register proxy votes following the procedures set out in the CREST Manual.
1. A "Vote withheld" is not a vote at law, which means that the vote will not be counted in the proportion of votes "For" and "Against" the relevant Resolution. A Shareholder who does not give any voting instructions in relation to a Resolution should note that his/her proxy will have authority to vote or withhold a vote on that Resolution as he/she thinks fit. A proxy will also have authority to vote or to withhold a vote on any other business (including amendments to Resolutions) which properly come before the Meeting as he/she thinks fit.
1. CREST members who wish to appoint a proxy or proxies through the CREST electronic proxy appointment service may do so for the Meeting and any adjournment(s) of the Meeting by using the procedures described in the CREST Manual. 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. 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 UK & Ireland'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 by a previously appointed proxy must, in order to be valid, be transmitted so as to be received by the Company's agent (ID 3RA50) by the latest time(s) for receipt of proxy appointments set out above. 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 Company'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.
1. CREST members and, where applicable, their CREST sponsors or voting service providers should note that Euroclear UK & Ireland Limited does not make available special procedures in CREST for any particular messages. Normal system timings and limitations will therefore apply 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 CREST sponsor or voting provider(s) take(s)) such action as is 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.

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.

1. To be entitled to attend and vote at the Meeting, Shareholders must be registered in the register of members of the Company at 6pm on 5 November 2018 (or, if the Meeting is adjourned, at 6pm on the date which is two days prior to the adjourned meeting with no account being taken of any part of a day that is a non-working day). Changes to entries on the register after this time shall be disregarded in determining the rights of any person to attend and vote (and the number of votes they may cast) at the Meeting or adjourned meeting.
1. As at 12 October 2018 (the latest practicable date prior to the publication of this document), the Company's issued share capital consists of 591,548,235 ordinary shares, carrying one vote each. As at that date, the Company holds no shares in treasury. Therefore the total voting rights in the Company are 591,548,235.
1. The following documents will be available for inspection during normal business hours at the registered office of the Company until 6 November 2018 and at Herbert Smith Freehills LLP Exchange House, Primrose Street, London, EC2A 2EG from 11.15am on 7 November 2018:
y the proposed Rules of the SIG plc Bonus Plan
y the proposed Rules of the SIG plc 2018 Long Term Incentive Plan
1. Please note that the Company takes all reasonable precautions to ensure no viruses are present in any electronic communication it sends out but the Company cannot accept responsibility for loss or damage arising from the opening or use of any email or attachments from the Company and recommends that the Shareholders subject all messages to virus checking procedures prior to use. Any electronic communication received by the Company, including the lodgement of an electronic Form of Proxy, that is found to contain any virus will not be accepted.
1. Shareholders vote on a show of hands, unless a poll is validly called. As soon as practicable following the Meeting, the results of the voting at the Meeting and the numbers of proxy votes cast for and against and the number of votes actively withheld in respect of each of the Resolutions will be announced via a Regulatory Information Service and also placed on the Company's website www.sigplc.com.
1. A member of the Company which is a corporation may authorise a person or persons to act as its representative(s) at the Meeting. In accordance with the provisions of the Companies Act 2006, each such representative may exercise (on behalf of the corporation) the same powers as the corporation could exercise if it were an individual member of the Company, provided that they do not do so in relation to the same shares. It is no longer necessary to nominate a designated corporate representative.
1. The Company must cause to be answered at the Meeting any question relating to the business being dealt with at the Meeting which is put by a member attending the Meeting, except (i) if to do so would interfere unduly with the preparation for the Meeting or involve the disclosure of confidential information, (ii) if the answer has already been given on a website in the form of an answer to a question, or (iii) if it is undesirable in the interests of the Company or the good order of the Meeting that the question be answered.
1. The contents of this Notice of Meeting and all the information required by Section 311 A of the Companies Act 2006 will be available on the Company's website www.sigplc.com.
1. You may not use any electronic address provided in this Notice of General Meeting to communicate with the Company for any purposes other than those expressly stated.

GM NOTICE: APPENDIX 1

Remuneration policy

The Directors' Remuneration Policy will be put to a binding vote at the General Meeting held on 7 November 2018 and will take effect from the date of the meeting. This Policy is being put to shareholders because it incorporates the new SIG plc Bonus Plan (the "Bonus Plan") and the SIG plc 2018 Long Term Incentive Plan (the "LTIP"). The Remuneration Committee has also taken the opportunity to update the Policy for developments in best practice, including the revisions to the UK Corporate Governance Code published in July 2018.

The Company's policy is to provide remuneration packages that fairly reward the Executive Directors for the contribution they make to the business and that are appropriately competitive to attract, retain and motivate Executive Directors and Senior Managers of the right calibre. A significant proportion of remuneration takes the form of variable pay, which is linked to the achievement of specific and stretching targets that align with the creation of Shareholder value and the Company's strategic goals. The Group's financial and strategic objectives are set out in the Strategic Report on pages 8 to 41 of our 2017 Annual Report.

The Committee is satisfied that the Remuneration Policy set out below is in the best interests of Shareholders and does not promote excessive risk-taking. In line with the 2018 UK Corporate Governance code, the Committee has discretion to adjust the formulaic Bonus Plan and LTIP vesting outcomes to ensure alignment of pay with performance, i.e. to ensure the final outcome is a fair and true reflection of underlying business performance. Any adjustments will be disclosed in the relevant Annual Report on Remuneration.

Directors' remuneration policy

FIXED REMUNERATION

Element	Purpose and link to strategy	Operation and process
Base salary	To attract and retain talent in the labour market in which the Executive Director is employed.	Reviewed on an annual basis (with effect from January) or following a significant change in responsibilities, taking into account the individual's performance and experience, with reference to published remuneration information from similar sized companies (excluding financial services) and companies operating in a similar sector. The Committee also takes account of the annual salary review for the rest of the Group.
Benefits	To provide benefits that are appropriately competitive within the relevant labour market.	Benefits include (but are not limited to) a company car, medical and permanent health insurance. Benefits are reviewed annually and their value is not pensionable. The Committee recognises the need to maintain suitable flexibility in the benefits provided to ensure it is able to support the objective of attracting and retaining personnel in order to deliver Company strategy. Additional benefits may therefore be offered such as relocation allowances on recruitment.
Pension	To provide retirement benefits that are appropriately competitive within the relevant labour market.	The Company provides a contribution to a defined contribution pension scheme (open to all UK-based employees of the Group), or provides a cash equivalent at the request of the individual.
Share Incentive Plan ('SIP')	To encourage share ownership across all UK based employees using HMRC tax-advantaged schemes.	The SIP is an HMRC tax-advantaged plan which provides all UK-based employees with a potentially tax efficient way of purchasing shares and receiving matching shares. The Company gives one matching share for each share purchased by the employee up to a maximum of £20 each month. Executive Directors are entitled to participate in the SIP on the same terms as other employees.

	Opportunity	Performance metrics	Recovery of sums (clawback)	Changes to current policy
Reviewed on an annual basis (with effect from January) or following a significant change in responsibilities, taking into account the individual's performance and experience, with reference to published	It is anticipated that salary increases will generally be in line with the general employee population.	Not applicable.	Not applicable.	None.
remuneration information from similar sized companies (excluding financial services) and companies operating in a similar sector. The Committee also takes account of the annual salary review for the rest of	Individuals who are recruited or promoted to the Board may, on occasion, have their salaries set below the targeted policy level until they become established in their role. In such cases subsequent increases in salary may be higher than the general rises for employees until the target positioning is achieved.
	In certain circumstances (including, but not limited to, a significant increase in role size or complexity, or no increase for a number of years) the Committee has discretion to make appropriate adjustments to salary levels.
Benefits include (but are not limited to) a company car, medical and permanent health insurance. Benefits The Committee recognises the need to maintain suitable flexibility in the benefits provided to ensure it is able to support the objective of attracting and retaining personnel in order to deliver Company strategy. Additional benefits may therefore be offered such as relocation allowances on recruitment.	Benefits may vary by role. The cost of benefits may vary as a result of factors outside the Company's control (e.g. increases in healthcare insurance premiums), though it is not anticipated that the cost of benefits will exceed £35,000 per annum per Executive Director over the term of this Policy. The Committee retains the discretion to approve a higher cost in	Not applicable.	Not applicable.	None
	exceptional circumstances (e.g. relocation).
The Company provides a contribution to a defined contribution pension scheme (open to all UK-based	15% of base salary. When recruiting or promoting new Executive Directors the Committee will aim at aligning the pension contribution to be provided to those of employees.	Not applicable.	Not applicable.	None
The SIP is an HMRC tax-advantaged plan which provides all UK-based employees with a potentially tax efficient way of purchasing shares and receiving matching shares. The Company gives one matching share Executive Directors are entitled to participate in the SIP on the same terms as other employees.	Maximum opportunity is in line with HMRC limits.	Not applicable.	Not applicable.	None

GM NOTICE: APPENDIX 1 CONTINUED

VARIABLE REMUNERATION

Element	Purpose and link to strategy	Operation and process
SIG plc Bonus Plan	To incentivise the achievement of annual performance targets which supports the Company's short term key performance indicators as well as providing long-term alignment with shareholders through the operation of bonus deferral.	Annual bonus awards are granted annually following the signing of the Report and Accounts. The performance period is one financial year with payout determined by the Committee following the year end, based on achievement against a range of financial and non-financial targets including having regard to environmental, health and safety issues. Executive Directors will receive 44.4% of the maximum bonus earned in cash. They are required to defer the remaining bonus earned into an award over SIG shares for a period of three years under the Bonus Plan and a two-year holding period applies for vested awards, during which time Executive Directors may not sell shares save to cover tax. y The maximum cash bonus is 66.7% of salary (44.4% of the maximum bonus opportunity); y The maximum share bonus is 83.3% of salary (55.6% of the maximum bonus opportunity). Bonus Plan Awards in shares will be subject to:- y A three year vesting period; and y an additional two year holding period post vesting. Dividend equivalents are payable over the vesting periods in respect of the Bonus Plan Awards which vest. The Committee will operate all incentive plans according to the rules of each respective plan and the discretions contained therein. The discretions cover aspects such as the timing of grant and vesting of awards, determining the size of the award (subject to the policy limits), the treatment of leavers, retrospective adjustment of awards (e.g. for a rights issue, a corporate restructuring or for special dividends) and, in exceptional circumstances, the discretion to adjust previously set targets for an incentive award if events happen which cause the Committee to determine that it would be appropriate to do so. In exercising such discretions, the Committee will take into account generally accepted market practice, best practice guidelines, the provisions of the Listing Rules and the Company's approved Remuneration Policy. Malus and clawback arrangements are in place. These are compliant with the UK Corporate Governance Code and in line with best practice in this area. Cessation of employment and change of control provisions apply as set out in the notes to the Policy table.
SIG plc 2018 Long Term Incentive Plan	To incentivise and reward the delivery of the Group's long term strategy whilst providing strong alignment with Shareholders.	Executive Directors are granted annual awards of nil-cost options, restricted awards or conditional share awards, which vest based on performance over a minimum of three years. Awards normally vest after three years, and a two-year holding period applies for vested awards, during which time Executive Directors may not sell shares save to cover tax. Dividend equivalents are payable over the vesting periods in respect of the awards which vest. The Committee will operate all incentive plans according to the rules of each respective plan and the discretions contained therein. The discretions cover aspects such as the timing of grant and vesting of awards, determining the size of the award (subject to the policy limits), the treatment of leavers, retrospective adjustment of awards (e.g. for a rights issue, a corporate restructuring or for special dividends) and, in exceptional circumstances, the discretion to adjust previously set targets for an incentive award if events happen which cause the Committee to determine that it would be appropriate to do so. In exercising such discretions, the Committee will take into account generally accepted market practice, best practice guidelines, the provisions of the Listing Rules and the Company's approved Remuneration Policy. Malus and clawback arrangements are in place. These are compliant with the UK Corporate Governance Code and in line with best practice in this area. Cessation of employment and change of control provisions apply as set out in the notes to the Policy table.

	Opportunity	Performance metrics	Recovery of sums (clawback)	Changes to current policy
Annual bonus awards are granted annually following the signing of the Report and Accounts. The performance period is one financial year with payout determined by the Committee following the year end, based on achievement against a range of financial and non-financial targets including having regard to environmental, health and safety issues. Executive Directors will receive 44.4% of the maximum bonus earned in cash. They are required to defer the remaining bonus earned into an award over SIG shares for a period of three years under the Bonus Plan and a two-year holding period applies for vested awards, during which time Executive Directors may not sell shares save to cover tax. The maximum cash bonus is 66.7% of salary (44.4% of the maximum bonus opportunity); The maximum share bonus is 83.3% of salary (55.6% of the maximum bonus opportunity). Bonus Plan Awards in shares will be subject to:- A three year vesting period; and an additional two year holding period post vesting. Dividend equivalents are payable over the vesting periods in respect of the Bonus Plan Awards which vest. The Committee will operate all incentive plans according to the rules of each respective plan and the discretions contained therein. The discretions cover aspects such as the timing of grant and vesting of awards, determining the size of the award (subject to the policy limits), the treatment of leavers, retrospective adjustment of awards (e.g. for a rights issue, a corporate restructuring or for special dividends) and, in exceptional circumstances, the discretion to adjust previously set targets for an incentive award if events happen which cause the Committee to determine that it would be appropriate to do so. In exercising such discretions, the Committee will take into account generally accepted market practice, best practice guidelines, the provisions of the Listing Rules and the Company's approved Malus and clawback arrangements are in place. These are compliant with the UK Corporate Governance Code and in line with best practice in this area. Cessation of employment and change of control provisions apply as set out in the notes to the Policy table.	Maximum opportunity is 150% of salary. For entry level and target performance, the bonus earned is up to 30% and up to 65% of maximum, respectively.	Performance targets will be set by the Committee annually based on a range of financial and non-financial measures. See the GM Notice for details of the proposed performance measures for the first year of operation of the Bonus Plan. The specific measures, targets and weightings may vary from year to year in order to align with the Group's strategy over each year. However, at least 50% of the awards will be linked to financial measures. The measures will be dependent on the Group's goals over the year under review and directly link to the key measurable strategic milestones to incentivise executives to focus on the execution of the strategy. The actual performance targets set are not disclosed at the start of the financial year, as they are considered to be commercially sensitive. These will be reported and disclosed retrospectively at the end of the year in order for shareholders to assess the basis for any bonus outcomes. In exceptional circumstances the Committee retains the discretion to: y Change the performance measures and targets and the weighting attached to the performance measures and targets part-way through a performance year if there is a significant and material event which causes the Committee to believe the original measures, weightings and targets are no longer appropriate; and y Make downward or upward adjustments to the amount of bonus earned resulting from the application of the performance measures, if the Committee believe that the bonus outcomes are not a fair and accurate reflection of business performance.	The annual bonus is subject to malus and clawback, i.e. forfeiture or reduction of the deferred portion or recovery of paid amounts, in certain circumstances. See later section on malus and clawback on page 22.	The maximum value of the cash element of the annual bonus remains unchanged at 66.7% of salary. The entire increase in opportunity is provided through the deferred share element which is now a maximum of 83.3% of salary. Addition of a holding period to deferred share element of Bonus Plan.
Executive Directors are granted annual awards of nil-cost options, restricted awards or conditional share awards, which vest based on performance over a minimum of three years. Awards normally vest after three years, and a two-year holding period applies for vested awards, during which time Executive Directors may not sell shares save to cover tax. Dividend equivalents are payable over the vesting periods in respect of the awards which vest. The Committee will operate all incentive plans according to the rules of each respective plan and the discretions contained therein. The discretions cover aspects such as the timing of grant and vesting of awards, determining the size of the award (subject to the policy limits), the treatment of leavers, retrospective adjustment of awards (e.g. for a rights issue, a corporate restructuring or for special dividends) and, in exceptional circumstances, the discretion to adjust previously set targets for an incentive award if events happen which cause the Committee to determine that it would be appropriate to do so. In exercising such discretions, the Committee will take into account generally accepted market practice, best practice guidelines, the provisions of the Listing Rules and the Company's approved Malus and clawback arrangements are in place. These are compliant with the UK Corporate Governance Cessation of employment and change of control provisions apply as set out in the notes to the Policy table.	Maximum annual award is up to 200% of salary (the "initial award"). The initial award can be increased by a multiplier of up 1.5 times such that the maximum overall award is 300% of salary. Threshold performance will result in vesting of no more than 25% of the initial award.	Vesting of LTIP awards is subject to the Group's performance measured over a three year period. The performance measures for the first grant of LTIP awards are set out in the GM Notice. The Committee will review and set weightings and targets before each grant to ensure they remain appropriate. The Committee may change the balance of the measures, or use different measures for subsequent awards, as appropriate. The Committee has the discretion to adjust targets or performance measures for any exceptional events that may occur during the year that will have an impact but would consult with shareholders in advance this event. No material change will be made to the type of performance conditions without prior shareholder consultation. In exceptional circumstances the Committee retains the discretion to: y Change the performance measures and targets and the weighting attached to the performance measures and targets part-way through a performance year if there is a significant and material event which causes the Committee to believe the original measures, weightings and targets are no longer appropriate; and y Make downward or upward adjustments to the amount earned resulting from the application of the performance measures, if the Committee believe that the LTIP outcomes are not a fair and accurate reflection of business performance.	LTIP awards are subject to malus and clawback, i.e. forfeiture or reduction of unvested awards or recovery of vested awards, in certain circumstances. See later section on malus and clawback on page 22.	Maximum annual award increased from 200% of salary to 300% of salary. Changes to performance measures as set in the GM Notice.

GM NOTICE: APPENDIX 1 CONTINUED

Share ownership requirements

To further align Executive Directors' interests with those of Shareholders, the Company has established the principle of requiring Executive Directors to build up and maintain a beneficial holding of shares in the Company equivalent to a minimum of 300% of base salary (increased from 200% of salary under the previous policy). This is a market leading shareholding requirement and under normal circumstances it is expected that this should be achieved within five years of the approval of this Policy. In addition, there is an intervening check in the shareholding requirement that at two years from the adoption of the new policy, Executive Directors should hold 100% of salary in shares on the way to achieving 300% of salary in five years. It is anticipated that this requirement will be achieved mainly by the vesting of shares through the Company's share plans.

Legacy arrangements

Executive Directors are eligible to receive payment under any award made prior to the approval and implementation of the Remuneration Policy set out in this notice including under the existing LTIP. For the avoidance of doubt, it is noted that the Company will honour any commitments entered into that have been disclosed previously to Shareholders.

Remuneration policy for other employees

Our approach to salary reviews is consistent across the Group, with consideration given to the level of responsibility, experience, individual performance, salary levels in comparable companies and the Company's ability to pay. Remuneration surveys are referenced, where appropriate, to establish market rates.

Senior managers participate in a similar annual bonus plan to that for the Executive Directors, with performance measures tailored to individual business areas. A limited number of senior managers are also eligible to receive LTIP awards. Performance conditions are consistent for all participants, while award sizes vary by organisational level. All UK employees are eligible to participate in the SIP on the same terms.

Pension and benefits arrangements are tailored to local market conditions, and so various arrangements are in place for different populations within SIG. Executive Directors participate in the same pension scheme as other senior managers.

Approach to recruitment remuneration

The Company's principle is that the remuneration of any new recruit will be assessed in line with the same principles as for the current Executive Directors. The Committee is mindful that it wishes to avoid paying more than it considers necessary to secure a preferred candidate with the appropriate calibre and experience needed for the role. In setting the remuneration for new recruits, the Committee will have regard to guidelines and shareholder sentiment regarding one-off or enhanced short-term or long-term incentive payments as well as giving consideration for the appropriateness of any award.

The Company's detailed policy when setting remuneration for the appointment of new Directors is summarised below:

Salary, Benefits and	These will be set in line with the policy for existing Executive Directors.
Pension	Individuals who are recruited or promoted to the Board may, on occasion, have their salaries set below the targeted policy level until they become established in their role. In such cases subsequent increases in salary may be higher than the general rises for employees until the target positioning is achieved.
Bonus Plan	The Executive Director will be eligible to participate in the Bonus Plan as set out in the remuneration policy table. The maximum level of bonus opportunity that may be offered is 150% of base salary consistent with that of existing Executive Directors.
	The annual bonus will normally be reduced on a pro rata basis to reflect the proportion of the year employed. The Committee retains flexibility to apply different performance measures and targets in the first year of appointment, depending on the timing and nature of the appointment.
LTIP	The Executive Director will be eligible to participate in the LTIP as set out in the remuneration policy table. The maximum level of LTIP opportunity that may be offered is 300% of base salary.
Maximum variable remuneration	The maximum level of variable remuneration which may be offered in the year of recruitment is 450% of salary (excluding buy-outs).
Share buy-outs or replacement awards	The Committee's Policy is not to provide replacement awards as a matter of course. However, should the Committee determine that the individual circumstances of recruitment justified the provision of a replacement award, the value of any incentives that will be forfeited on cessation of a director's previous employment will be calculated taking into account the following:
	y the proportion of the performance period completed on the date of the director's cessation of employment;
	y the performance conditions attached to the vesting of these incentives and the likelihood of them being satisfied; and
	y any other terms and conditions having a material effect on their value ('lapsed value').
	The Committee may then grant a replacement award up to the equivalent value as the lapsed value where possible under the Company's incentives plans. Where the circumstances are such that this is not possible a bespoke arrangement may be used including in accordance with Rule 9.4.2(R) of the Listing Rules.
Relocation Policies	In instances where the new Executive Director is required to relocate or spend significant time away from his/her normal residence, the Company may provide one-off compensation to reflect the cost of relocation for the Executive Director. The level of the relocation package will be assessed on a case by case basis but will take into consideration any cost of living differences/housing allowance, disturbance allowances and schooling.
Internal promotions	In the case of an internal appointment, any variable pay element awarded in respect of the prior role would be allowed to pay out according to the terms on which it was originally granted. These would be disclosed to shareholders in the remuneration report for the relevant financial year.

The Company's Policy when setting fees for the appointment of new Non-Executive Directors is to apply the policy which applies to current Non-Executive Directors, which is set out on pages 23 to 24.

Executive Director service contracts

Subject to the considerations set out overleaf, the Company's policy is to limit termination payments to pre-established contractual arrangements. In the event that the employment of an Executive Director is terminated, any compensation payable will be determined in accordance with the terms of the service contract between the Company and the Executive Director, as well as the rules of any incentive plans.

Executive Directors have service agreements with an indefinite term and which are terminable by either the Group or the Executive Director on six months' notice in the case of the Chief Executive Officer and on 12 months' notice in the case of the Chief Financial Officer.

If employment is terminated by the Company, the departing Executive Director may have a legal entitlement (under statute or otherwise) to additional amounts, which would need to be met. In addition, the Committee retains discretion to settle any claims by or on behalf of the Executive Director in return for making an appropriate payment and contributing to the legal fees incurred by the Executive Director in connection with the termination of employment, where the Company wishes to enter into a settlement agreement and the individual must seek independent legal advice.

There is no provision in the Executive Directors' service contracts for compensation to be payable on termination of their contract over and above sums due in respect of notice and accrued but untaken holiday, and as outlined below regarding the Bonus Plan and LTIP. Executive Director service contracts are available to view at the Company's registered office.

In certain circumstances, the Committee may approve new contractual arrangements with departing Executive Directors including (but not limited to) settlement, confidentiality, outplacement services, restrictive covenants and/or consultancy arrangements. These will be used sparingly and only entered into where the Committee believes that it is in the best interests of the Company and its Shareholders to do so.

Executive Director	Date of service contract
Mr N.W. Maddock	6 October 2016
Mr M. Oldersma	13 March 2017

Overarching principles

When determining any loss of office payment for a departing Director the Committee will always seek to minimise the cost to the Company while complying with the contractual terms and seeking to reflect the circumstances in place at the time. The Committee reserves the right to make additional payments where such payments are made in good faith in discharge of an existing legal obligation (or by way of damages for breach of such an obligation); or by way of settlement or compromise of any claim arising in connection with the termination of an Executive Director's office or employment.

The Committee will honour Executive Directors' contractual entitlements. Service contracts do not contain liquidated damages clauses. If a contract is to be terminated, the Committee will determine such mitigation as it considers fair and reasonable in each case. There are no contractual arrangements that would guarantee a pension with limited or no abatement on severance or early retirement. There is no agreement between the Company and its Directors or employees, providing for compensation for loss of office or employment that occurs because of a takeover bid. The Committee reserves the right to make additional payments where such payments are made in good faith in discharge of an existing legal obligation (or by way of damages for breach of such an obligation); or by way of settlement or compromise of any claim arising in connection with the termination of an Executive Director's office or employment.

GM NOTICE: APPENDIX 1 CONTINUED

LEAVER AND CHANGE OF CONTROL PROVISIONS

When considering termination payments under incentive plans, the Committee reviews all potential incentive outcomes to ensure they are fair to both shareholders and participants. The table below summarises how the awards under the Bonus Plan and the LTIP are typically treated in specific circumstances.

Plan	Scenario	Timing and calculation of vesting/payment	Committee's discretion
Bonus Plan	Good leaver – Death, ill health or disability, injury, redundancy, retirement, sale of the employing company or business out of the Group or any other reason as the Committee may determine.	Cash element The Committee will determine a pro-rated bonus based on the performance over the full year. Bonuses will be paid in the normal manner (part cash part deferred shares). Deferred share element Awards will vest on their original vesting dates with the exception of death when Awards vest on date of death. On cessation of employment holding periods will continue to apply.	The Remuneration Committee has the following elements of discretion: y to determine that an executive is a good leaver. It is the Remuneration Committee's intention to only use this discretion in circumstances where there is an appropriate business case which will be explained in full to shareholders. y to measure performance over the original performance period or at the date of cessation. The Remuneration Committee will make this determination depending on the type of good leaver reason resulting in the cessation; y to vest the award at the end of the vesting period or at the date of cessation. The Remuneration Committee will make this determination depending on the type of good leaver reason resulting in the cessation; y to determine whether the holding period will apply including whether in full or in part.
	Bad leaver – All other reasons	Cash element No bonus will be earned for the year of cessation. Deferred share element Lapse of any unvested awards. Awards subject to holding periods will be retained with the shares released at the end of these periods.
	Change of control.	Cash element The Committee will determine a pro-rated bonus based on the performance to the date of the change of control. This bonus will be paid in cash and/ or shares at the discretion of the Committee. Deferred share element Awards will vest on the change of control. Any holding periods will finish on the date of the change of control.	Cash element The Committee has discretion regarding whether to pro-rate the bonus for time. The Committee's normal policy is that it will pro-rate the bonus for time. It is the Committee's intention to use its discretion to not pro-rate in circumstances only where there is an appropriate business case which will be explained in full to shareholders.

Plan	Scenario	Timing and calculation of vesting/payment	Committee's discretion
LTIP	Good leaver – Death, ill health or disability, injury, redundancy, retirement, sale of the employing company or business out of the Group or any other reason as the Committee may determine. Bad leaver – All other reasons.	Any outstanding awards will normally vest on the normal vesting date subject to performance, and be prorated for time with the exception of death when Awards vest on date of death. Awards lapse.	The Remuneration Committee has the following elements of discretion: y to determine that an executive is a good leaver. It is the Remuneration Committee's intention to only use this discretion in circumstances where there is an appropriate business case which will be explained in full to shareholders; y to measure performance over the original performance period or at the date of cessation. The Remuneration Committee will make this determination depending on the type of good leaver reason resulting in the cessation; y to vest the LTIP award at the end of the original performance period or at the date of cessation. The Remuneration Committee will make this determination depending on the type of good leaver reason resulting in the cessation; y to determine whether the holding period will apply including whether in full or in part; and y to determine whether to pro-rate the maximum number of shares to the time from the date of grant to the date of cessation. The Remuneration Committee's normal policy is that it will pro-rate awards for time. It is the Remuneration Committee's intention to use discretion to not pro-rate in circumstances where there is an appropriate business case which will be explained in full to shareholders.
	Change of control.	The number of shares subject to subsisting LTIP awards will vest on a change of control, normally pro-rated for time and performance.	The Committee has discretion regarding the extent to which LTIP awards vest. The Committee's normal policy is that it will pro-rate the LTIP awards for time and will consider the extent to which any applicable performance conditions have been satisfied at the date of the relevant event. It is the Committee's intention to use its discretion to not pro-rate in circumstances only where there is an appropriate business case which will be explained in full to shareholders.

GM NOTICE: APPENDIX 1 CONTINUED

Malus and clawback policies

Bonus Plan – cash awards	Malus will apply up to the time of payment and clawback will apply for a period of 2 years post bonus payment.
Bonus Plan – share awards	Malus will apply during the vesting period and clawback will apply for a period of two years post-vesting.
LTIP	Malus will apply during the vesting period and clawback will apply for a period of two years post-vesting.

The circumstances in which malus and clawback could apply are as follows:

y discovery of a material misstatement resulting in an adjustment in the audited accounts of the Group or any Group company,
y the assessment of any performance condition or condition in respect of a Bonus Plan Award or LTIP Award was based on error, or inaccurate or misleading information,
y the discovery that any information used to determine the cash bonus or the number of Shares subject to a Bonus Plan Award or LTIP Award was based on error, or inaccurate or misleading information,
y action or conduct of a participant which, in the reasonable opinion of the Committee, amounts to employee misbehaviour, fraud or gross misconduct,
y failure of risk management and / or corporate failure; or
y events or the behaviour of a participant have led to the censure of a Group company by a regulatory authority or have had a significant detrimental impact on the reputation of any Group company provided that the Board is satisfied that the relevant participant was responsible for the censure or reputational damage and that the censure or reputational damage is attributable to him.

Pay-for-performance: scenario analysis

The following charts provide an estimate of the potential future reward opportunities for the Executive Directors, and the potential split between the different elements of pay under five different performance scenarios: "minimum", "on-target", "on-target with LTIP equity growth of 50% over 3 years", "maximum" and "maximum with LTIP equity growth of 50% over 3 years". Potential reward opportunities are based on SIG's Remuneration Policy, applied to salaries as at 1 January 2018.

Assumptions underlying the scenarios:

The "minimum" scenario includes base salary, pension and benefits only (i.e. fixed remuneration)

The "on-target" scenario includes fixed remuneration as above, plus on-target bonus payout of 65% of maximum and threshold LTIP vesting of up to 25% of the maximum initial award and a multiplier of 1x on the initial award.

The "on-target with LTIP equity growth of 50% over 3 years" scenario is the same as the "on-target" scenario with equity growth of 50% applied to the LTIP.

The "maximum" scenario includes fixed remuneration, plus 100% bonus payout and 100% vesting of the LTIP initial award and a multiplier of 1.5x on the initial award.

The "maximum with LTIP equity growth of 50% over 3 years" scenario is the same as the "maximum" scenario with equity growth of 50% applied to the LTIP.

Non-Executive Directors

The Non-Executive Directors ('NEDs'), including the Chairman, do not have service contracts. The Company's policy is that NEDs are appointed for specific terms of three years unless otherwise terminated earlier in accordance with the Articles of Association or by, and at the discretion of, either party upon three months' written notice. NED appointments are reviewed at the end of each three-year term. NEDs will normally be expected to serve two three-year terms, although the Board may invite them to serve for an additional period.

NED letters of appointment are available to view at the Company's registered office.

NEDs do not receive benefits from the Company and they are not eligible to join the Company's pension scheme or participate in any bonus or share incentive plan. Any reasonable expenses that they incur in the furtherance of their duties are reimbursed by the Company (including any tax liability thereon).

Details of the Remuneration Policy on NED fees are set out in the table below:

GM NOTICE: APPENDIX 1 CONTINUED

Purpose and link to strategy	Operation and process	Opportunity	Changes to current Policy
To attract and retain NEDs of the highest calibre with experience relevant to the Company.	Fees are reviewed annually in May with any increase effective from 1 May. The fee paid to the Chairman is determined by the Committee, and fees to NEDs are determined by the Board. Fee levels are benchmarked against comparable companies, and take account of the time commitment and the responsibilities of the NEDs. Other than for the Company Chairman, fees comprise a base fee for acting as an NED of the Company, and additional fees for acting as Senior Independent Director or as Chairman of a Board Committee, as appropriate. Additional fees may also be paid in respect of Company advisory Boards.	It is anticipated that increases to Chairman and NED fee levels will typically be in line with market levels of fee inflation. In exceptional circumstances (including, but not limited to, material misalignment with the market or a change in the complexity, responsibility or time commitment required to fulfil an NED role) the Board has discretion to make appropriate adjustments to fee levels to ensure they remain market competitive and fair to the Director. The maximum annual aggregate fee, for all Group NEDs, is £500,000 as set out in the Company's Articles of Association.	None

External directorships

The Committee acknowledges that Executive Directors may be invited to become independent Non-Executive Directors of other quoted companies which have no business relationship with the Company and that these duties can broaden their experience and knowledge to the benefit of the Company.

Executive Directors are permitted to accept such appointments with the prior approval of the Chairman. Approval will be given only where the appointment does not present a conflict of interest with the Group's activities and the wider exposure gained will be beneficial to the development of the individual. Where fees are payable in respect of such appointments, these would be retained by the Executive Director.

Considerations of conditions elsewhere in the Group

The Committee considers the pay and employment conditions elsewhere in the Group when determining remuneration for Executive Directors, and the Company seeks to promote good relationships with employee representative bodies as part of its employee engagement strategy. However, the Committee does not currently consult specifically with employees on the Executive Director Remuneration Policy.

Consideration of shareholder views

During 2018, the Committee has consulted extensively with shareholders and the main shareholder representative bodies on the proposals contained in this Notice and the original proposals were changed materially as a result of the feedback received. The original approach of a value sharing plan proposed by the Committee was changed to the current proposals due to a desire by a number of the Company's shareholders to see an approach more in line with a standard FTSE 250 Bonus Plan and LTIP with a reduced potential quantum compared to the original value sharing plan. Whilst the majority of shareholders recognised the Company was in a recovery stage and therefore a leveraged plan focused on driving absolute total shareholder return would be appropriate; there was a view that there should be a number of comparative and absolute underpins to any plan using this measure. All shareholders supported the Committee's desire for an incentive approach resulting in the long-term build-up and retention of material shareholdings by the Executive Directors.

At the end of the consultation exercise the majority of shareholders consulted (both by issued capital and number) were supportive of the proposals for the Remuneration Policy and Incentive Plans as set out in this notice.

The Committee is always open to feedback from Shareholders on the Remuneration Policy and arrangements.

GM NOTICE: APPENDIX 2

This Appendix 2 sets out the principal terms of the share plans for which the Company is seeking shareholder approval at the General Meeting on 7 November 2018, namely:

y The SIG plc Bonus Plan (the "Bonus Plan"); and
y The SIG plc 2018 Long Term Incentive Plan (the "LTIP").

The Bonus Plan and the LTIP are together referred to as the Plans in this Appendix 2. References in this Appendix 2 to the Board includes any designated committee of the Board.

1. THE BONUS PLAN

The Bonus Plan incorporates the Company's executive bonus plan as well as a mechanism for the deferral of bonus into awards over ordinary shares of the Company ("Shares"). The Bonus Plan will operate in respect of the annual bonus earned for the financial year ending 31 December 2019, with the first deferred awards over Shares under the Bonus Plan being granted following the announcement of the Company's financial results for that financial year.

Status

The Bonus Plan is both a cash bonus plan and a discretionary executive share plan under which a proportion of a participant's bonus may be deferred into an award over Shares. Under the Bonus Plan, the Board may, within certain limits, grant to eligible employees deferred awards over Shares taking the form of (i) nil cost options over Shares ("Bonus Plan Options") and/or (ii) conditional awards (i.e. a conditional right to acquire Shares) ("Bonus Plan Conditional Awards") and/or (iii) Shares which are subject to restrictions and the risk of forfeiture ("Bonus Plan Restricted Shares" and, together with Bonus Plan Options and Bonus Plan Conditional Awards, "Bonus Plan Awards"). No payment is required for the grant of a Bonus Plan Award.

Eligibility

All employees (including Executive Directors) of the Company and its subsidiaries (the "Group") are eligible for selection to participate in the Bonus Plan at the discretion of the Board.

Bonus opportunity

Participants selected to participate in the Bonus Plan for a financial year of the Company will be eligible to receive an annual bonus subject to satisfying performance conditions and targets set for that financial year. The Board may determine that a proportion of a participant's annual bonus will be deferred into a Bonus Plan Award. The maximum bonus (including any part of the bonus deferred into a Bonus Plan Award) deliverable under the Bonus Plan will be 150% of a participant's annual base salary. The maximum cash bonus payable will be 66.7% of a participant's annual base salary. The maximum Bonus Plan Award will be 83.3% of a participant's annual base salary. The Board will determine the bonus to be delivered following the end of the relevant financial year.

Except in certain circumstances, a Bonus Plan participant who ceases to be employed by or hold office with the Group before the bonus determination is made will cease to be eligible to receive a bonus. However, if a participant so ceases because of his death, ill-health, injury, disability, redundancy, retirement with the agreement of his employer, the participant being employed by a company which ceases to be a Group company or being employed in an undertaking which is transferred to a person who is not a Group company or in other circumstances at the discretion of the Board (each a "Bonus Plan Good Leaver Reason"), he will remain eligible for a bonus. The performance conditions and targets will be considered and the bonus will be deliverable in the same way and at the same time as if the individual had not ceased to be employed or hold office with the Group, unless the Board otherwise decides. The value of the bonus will normally be pro-rated to reflect the reduced period of time between the start of the financial year and the participant's cessation of employment as a proportion of that financial year, unless the Board otherwise decides.

In addition, in the event that a corporate event occurs as described below, a participant will be eligible to receive a bonus as soon as practicable after the relevant event, the amount of which shall be determined by the Board taking into account the performance conditions and targets. The value of the bonus will be pro-rated to reflect the reduced period of time between the start of the financial year and the relevant corporate event as a proportion of the relevant financial year unless the Board otherwise decides.

Malus and clawback provisions apply to a bonus awarded under the Bonus Plan as described below.

Grant of Bonus Plan Awards

The Board may determine that a proportion of a participant's annual bonus will be deferred into a Bonus Plan Award.

There is a maximum limit on the market value of Shares granted to any employee under a Bonus Plan Award of 85% of salary. Bonus Plan Awards may be granted during the 42 days beginning on: (i) the dealing day after the announcement of the Company's results for any period; (ii) any day on which the Board determines that circumstances are sufficiently exceptional to justify the making of the Bonus Plan Award at that time; or (iii) the day after the lifting of any dealing restrictions.

However, no Bonus Plan Awards may be granted more than 10 years from the date when the Bonus Plan was approved by shareholders.

GM NOTICE: APPENDIX 2 CONTINUED

Malus

The Board may decide (a) at the time of payment of a cash bonus or at any time before to reduce the amount of the bonus (including to nil) and/ or (b) at the vesting of an Bonus Plan Award or any time before, that the number of Shares subject to an Bonus Plan Award shall be reduced (including to nil) on such basis that the Board in its discretion considers to be fair and reasonable in the following circumstances:

y discovery of a material misstatement resulting in an adjustment in the audited accounts of the Group or any Group company,
y the assessment of any performance condition or condition in respect of an Bonus Plan Award was based on error, or inaccurate or misleading information,
y the discovery that any information used to determine the cash bonus or the number of Shares subject to an Bonus Plan Award was based on error, or inaccurate or misleading information,
y action or conduct of a participant which, in the reasonable opinion of the Committee, amounts to employee misbehaviour, fraud or gross misconduct;
y failure of risk management and / or corporate failure; or
y events or the behaviour of a participant have led to the censure of a Group company by a regulatory authority or have had a significant detrimental impact on the reputation of any Group company provided that the Board is satisfied that the relevant participant was responsible for the censure or reputational damage and that the censure or reputational damage is attributable to him.

Vesting and exercise

Bonus Plan Awards will normally vest on the third anniversary of the date of grant of the Bonus Plan Award to the extent permitted following any operation of malus or clawback. Bonus Plan Options will normally remain exercisable for a period determined by the Board at grant which shall not exceed 10 years from the date of grant.

Clawback

The Board may apply clawback to all or part of a participant's cash bonus and/or Bonus Plan Award in substantially the same circumstances as apply to malus (as described above) during the period of two years following the payment of cash bonus and two years following vesting for Bonus Plan awards by reference to which the Bonus Plan Award was granted. Clawback may be effected, among other means, by requiring the transfer of Shares, payment of cash or reduction of awards or bonuses.

Cessation of employment

Except in certain circumstances, set out below, a Bonus Plan Award will lapse immediately upon a participant ceasing to be employed by or holding office with the Group.

However, if a participant so ceases because of a Good Leaver Reason, his Bonus Plan Award will ordinarily vest on the date when it would have vested if he had not so ceased to be a Group employee or director, subject to the operation of malus or clawback. In addition, the Board may decide that vesting will be pro-rated to reflect the reduced period of time between grant and the participant's cessation of employment as a proportion of the normal vesting period.

If a participant ceases to be a Group employee or director for a Bonus Plan Good Leaver Reason, the Board can alternatively decide that his Bonus Plan Award will vest early when he leaves. If an employee dies, a proportion of his Bonus Plan Award will normally vest on the date of his death. The extent to which an Bonus Plan Award will vest in these situations will be determined by the Board at its absolute discretion taking into account, among other factors, the period of time the Bonus Plan Award has been held and the operation of malus or clawback. In addition, the Board may decide that vesting will be pro-rated to reflect the reduced period of time between grant and the participant's cessation of employment as a proportion of the normal vesting period.

To the extent that Bonus Plan Options vest for an Bonus Plan Good Leaver Reason, they may be exercised for a period of 6 months following vesting (or such longer period as the Board determines) and will otherwise lapse at the end of that period. To the extent that Bonus Plan Options vest following death of a participant, they may be exercised for a period of 12 months following death and will otherwise lapse at the end of that period.

Corporate events

In the event of a takeover, scheme of arrangement or winding-up of the Company, Bonus Plan Awards will vest early in full, unless the Board otherwise decides. Further the Committee has discretion to determine whether any annual bonus will be earned for the year in which the event occurs.

To the extent that Bonus Plan Options vest in the event of a takeover, scheme of arrangement or winding-up of the Company they may be exercised for a period of 6 months measured from the relevant event (or in the case of takeover such longer period as the Board determines) and will otherwise lapse at the end of that period.

In the event of a demerger, distribution or any other corporate event, the Board may determine that Bonus Plan Awards shall vest. The proportion of the Bonus Plan Awards which vest shall be determined by the Board taking into account, among other factors, the period of time the Bonus Plan Award has been held by the participant. Bonus Plan Options that vest in these circumstances may be exercised during such period as the Board determines and will otherwise lapse at the end of that period.

If there is a corporate event resulting in a new person or company acquiring control of the Company, the Board may (with the consent of the acquiring company) alternatively decide that Bonus Plan Awards will not vest or lapse but will be replaced by equivalent new awards over shares in the new acquiring company.

2. THE LTIP

Status

The LTIP is a discretionary executive share plan and is intended to be operated for selected directors and senior employees of the Company and its subsidiaries (the Group).

Under the LTIP, awards are granted over ordinary shares of the Company (Shares). The Board may, within certain limits and subject to any applicable performance conditions, grant to eligible employees (i) nil cost options over Shares ("LTIP Options") and/or (ii) conditional awards (i.e. a conditional right to acquire Shares) ("LTIP Conditional Awards") and/or (iii) Shares which are subject to restrictions and the risk of forfeiture ("LTIP Restricted Shares", and together with LTIP Options and LTIP Conditional Awards, "LTIP Awards"). No payment is required for the grant of an LTIP Award.

Eligibility

All employees (including Executive Directors) of the Group are eligible for selection to participate in the LTIP at the discretion of the Board.

Grant of LTIP Awards

The Board may grant LTIP Awards over Shares to eligible employees with a maximum total market value in any financial year of up to 300% of the relevant individual's annual base salary.

LTIP Awards may be granted during the 42 days beginning on: (i) the date of shareholder approval of the LTIP; (ii) the dealing day after the announcement of the Company's results for any period; (iii) any day on which the Board determines that circumstances are sufficiently exceptional to justify the making of the LTIP Award at that time; or (iv) the day after the lifting of any dealing restrictions.

However, no LTIP Awards may be granted more than 10 years from the date when the LTIP was approved by shareholders.

Performance and other conditions

The Board may impose performance conditions on the vesting of LTIP Awards. Where performance conditions are specified for LTIP Awards, the underlying measurement period for such conditions will ordinarily be three years. The proposed performance conditions for the first grant of LTIP Awards is set out in the body of this Notice.

Any performance conditions applying to LTIP Awards may be varied, substituted or waived if the Board considers it appropriate, provided the Board considers that the new performance conditions are reasonable and are not materially less difficult to satisfy than the original conditions (except in the case of waiver).

The Board may also impose other conditions on the vesting of LTIP Awards.

Malus

The Board may decide, at the vesting of LTIP Awards or at any time before, that the number of Shares subject to an LTIP Award shall be reduced (including to nil) on such basis that the Board in its discretion considers to be fair and reasonable in the following circumstances:

y discovery of a material misstatement resulting an adjustment in the audited accounts of the Group or any Group company;
y the assessment of any performance condition or condition in respect of an LTIP Award was based on error, or inaccurate or misleading information;
y the discovery that any information used to determine the number of Shares subject to an LTIP Award was based on error, or inaccurate or misleading information;
y action or conduct of a participant which, in the reasonable opinion of the Committee, amounts to employee misbehaviour, fraud or gross misconduct;
y failure of risk management and / or corporate failure; or
y events or the behaviour of a participant have led to the censure of a Group company by a regulatory authority or have had a significant detrimental impact on the reputation of any Group company provided that the Board is satisfied that the relevant participant was responsible for the censure or reputational damage and that the censure or reputational damage is attributable to him.

Vesting and exercise

LTIP Awards will normally vest, and LTIP Options will normally become exercisable, on the third anniversary of the date of grant of the LTIP Award to the extent that any applicable performance conditions have been satisfied and to the extent permitted following any operation of malus or clawback. LTIP Options will normally remain exercisable for a period determined by the Board at grant which shall not exceed 10 years from grant.

GM NOTICE: APPENDIX 2 CONTINUED

Clawback

The Board may apply clawback to all or part of a participant's LTIP Award in substantially the same circumstances as apply to malus (as described above) during the period of two years following the vesting of an Award. Clawback may be effected, among other means, by requiring the transfer of Shares, payment of cash or reduction of awards.

Cessation of employment

Except in certain circumstances, set out below, an LTIP Award will lapse immediately upon a participant ceasing to be employed by or holding office with the Group.

However, if a participant so ceases because of his death, ill-health, injury, disability, redundancy, retirement with the agreement of his employer, the participant being employed by a company which ceases to be a Group company or being employed in an undertaking which is transferred to a person who is not a Group company or in other circumstances at the discretion of the Board (each an "LTIP Good Leaver Reason"), his LTIP Award will ordinarily vest on the date when it would have vested if he had not so ceased to be a Group employee or director, subject to the satisfaction of any applicable performance conditions measured over the original performance period and the operation of malus or clawback. In addition, unless the Board decides otherwise, vesting will be pro-rated to reflect the reduced period of time between grant and the participant's cessation of employment as a proportion of the normal vesting period.

If a participant ceases to be a Group employee or director for an LTIP Good Leaver Reason, the Board can alternatively decide that his LTIP Award will vest early when he leaves. If a participant dies, a proportion of his LTIP Award will normally vest on the date of his death. The extent to which an LTIP Award will vest in these situations will be determined by the Board at its absolute discretion taking into account, among other factors, the period of time the LTIP Award has been held and the extent to which any applicable performance conditions have been satisfied at the date of cessation of employment and the operation of malus or clawback. In addition, unless the Board decides otherwise, vesting will be pro-rated to reflect the reduced period of time between grant and the participant's cessation of employment as a proportion of the normal vesting period.

To the extent that LTIP Options vest for an LTIP Good Leaver Reason, they may be exercised for a period of 6 months following vesting (or such longer period as the Board determines) and will otherwise lapse at the end of that period. To the extent that LTIP Options vest following death of a participant, they may normally be exercised for a period of 12 months following death and will otherwise lapse at the end of that period.

Corporate events

In the event of a takeover, scheme of arrangement, or winding-up of the Company, the LTIP Awards will vest early. The proportion of the LTIP Awards which vest shall be determined by the Board taking into account, among other factors, the period of time the LTIP Award has been held by the participant and the extent to which any applicable performance conditions have been satisfied at that time.

To the extent that LTIP Options vest in the event of a takeover, scheme of arrangement, or winding-up of the Company they may be exercised for a period of six months measured from the relevant event (or in the case of takeover such longer period as the Board determines) and will otherwise lapse at the end of that period.

In the event of a demerger, distribution or any other corporate event, the Board may determine that LTIP Awards shall vest. The proportion of the LTIP Awards which vest shall be determined by the Board taking into account, among other factors, the period of time the LTIP Award has been held by the participant and the extent to which any applicable performance conditions have been satisfied at that time. LTIP Options that vest in these circumstances may be exercised during such period as the Board determines and will otherwise lapse at the end of that period.

If there is a corporate event resulting in a new person or company acquiring control of the Company, the Board may (with the consent of the acquiring company) alternatively decide that LTIP Awards will not vest or lapse but will be replaced by equivalent new awards over shares in the new acquiring company.

3. PROVISIONS APPLYING TO EACH OF THE PLANS

Awards not transferable

Awards granted under the Plans are not transferable other than to the participant's personal representatives in the event of his death provided that awards and Shares may be held by the trustees of an employee as nominee for the participants.

Holding period

At its discretion, the Board may grant awards under one or more of the Plans subject to a holding period of a maximum of up to two years following vesting.

Limits

The Plans may operate over new issue Shares, treasury Shares or Shares purchased in the market. The rules of each of the Plans provide that, in any period of 10 calendar years, not more than 10% of the Company's issued ordinary share capital may be issued under the relevant plan and under any other employees' share scheme operated by the Company. In addition, the rules of each of the Plans provide that, in any period of 10 calendar years, not more than 5% of the Company's issued ordinary share capital may be issued under the relevant plan and under any other executive share scheme adopted by the Company. Shares issued out of treasury under the relevant Plan will count towards these limits for so long as this is required under institutional shareholder guidelines. In addition, awards which are renounced or lapse shall be disregarded for the purposes of these limits.

Variation of capital

If there is a variation of share capital of the Company or in the event of a demerger or other distribution, special dividend or distribution, the Board may make such adjustments to awards granted under each of the Plans, including the number of Shares subject to awards and the option exercise price (if any), as it considers to be fair and reasonable.

Dividend equivalents

In respect of any award granted under any of the Plans, the Board may decide that participants will receive a payment (in cash and/or additional Shares) equal in value to any dividends that would have been paid on the Shares which vest under that award by reference to the period between the time when the relevant award was granted and the time when the relevant award vested. This amount may assume the reinvestment of dividends and exclude or include special dividends or dividends in specie.

Alternative settlement

At its discretion, the Board may decide to satisfy awards granted under the Plans with a payment in cash or Shares equal to any gain that a participant would have made had the relevant award been satisfied with Shares.

Rights attaching to Shares

Except in relation to the award of Shares subject to restrictions, Shares issued and/or transferred under the Plans will not confer any rights on any participant until the relevant award has vested or the relevant option has been exercised and the participant in question has acquired the underlying Shares. Any Shares allotted when an option is exercised or an award vests will rank equally with Shares then in issue (except for rights arising by reference to a record date prior to their issue). A participant awarded Shares subject to restrictions shall have the same rights as a holder of Shares in issue at the time that the participant acquires the Shares, save to the extent set out in the agreement with the participant relating to those Shares.

Amendments

The Board may, at any time, amend the provisions of any of the Plans in any respect. The prior approval of the Company in General Meeting must be obtained in the case of any amendment to the advantage of participants which is made to the provisions relating to eligibility, individual or overall limits, the persons to whom an award can be made under the relevant Plan, the adjustments that may be made in the event of any variation to the share capital of the Company and/or the rule relating to such prior approval, save that there are exceptions for any minor amendment to benefit the administration of the relevant Plan, to take account of the provisions of any proposed or existing legislation or to obtain or maintain favourable tax, exchange control or regulatory treatment for participants, the Company and/or its other Group companies. Amendments may not normally adversely affect the rights of participants except where participants are notified of such amendment and the majority of participants approve such amendment.

Overseas plans

The Board may, at any time, establish further plans based on the LTIP and the Bonus Plan for overseas territories. Any such plan shall be similar to the LTIP or the Bonus Plan, as relevant, but modified to take account of local tax, exchange control or securities laws. Any Shares made available under such further overseas plans must be treated as counting against the limits on individual and overall participation under the relevant Plan.

Benefits not pensionable

The benefits received under the Plans are not pensionable.

SHAREHOLDER NOTES

SIG plc: Hillsborough Works, Langsett Road, Sheffield S6 2LW, United Kingdom tel: +44 (0) 114 285 6300 fax: +44 (0) 114 285 6349 web: www.sigplc.co.uk SIG plc: Hillsborough Works, Langsett Road, Sheffield S6 2LW, United Kingdom tel: +44 (0) 114 285 6300 fax: +44 (0) 114 285 6349 web: www.sigplc.co.uk www.sigplc.com

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SIG PLC — Proxy Solicitation & Information Statement 2018

5276_egm_2018-10-15_5edfa430-404e-4a1c-8ad6-39fe2d845a2c.pdf

THIS DOCUMENT IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION

Chairman's Letter to Shareholders and Notice of General Meeting

DIRECTORS:

Dear Shareholder

GENERAL MEETING

THE RESOLUTIONS

Resolution 1 – Approval of Directors' Remuneration Policy (ordinary resolution)

Resolution 2 – Approval of the SIG plc Bonus Plan (the "Bonus Plan") (ordinary resolution)

Resolution 3 – Approval of the SIG plc 2018 Long Term Incentive Plan (the "LTIP") (ordinary resolution)

RECOMMENDATION AND ACTION TO BE TAKEN

DIRECTORS' REMUNERATION POLICY

Introduction

Background

Shareholder Consultation

OVERVIEW OF THE INCENTIVE PLANS

BONUS PLAN: CORE TERMS

LTIP: CORE TERMS

OTHER LTIP TERMS

SCHEDULE 1 TO THE CHAIR OF REMUNERATION COMMITTEE'S LETTER – SUMMARY OF THE KEY TERMS OF THE SIG PLC BONUS PLAN (THE "BONUS PLAN")

SCHEDULE 2 TO THE CHAIR OF REMUNERATION COMMITTEE'S LETTER – SUMMARY OF THE KEY TERMS OF THE SIG PLC 2018 LONG TERM INCENTIVE PLAN (THE "LTIP")

SCHEDULE 3 TO THE CHAIR OF REMUNERATION COMMITTEE'S LETTER – ILLUSTRATIVE MODELLING OF THE COST AND BENEFITS OF THE BONUS PLAN AND LTIP

Assumptions

Potential Benefits

SCHEDULE 3 continued

SCHEDULE 3 continued

SIG PLC NOTICE OF A GENERAL MEETING

RICHARD MONRO

NOTES:

GM NOTICE: APPENDIX 1

Remuneration policy

Directors' remuneration policy

GM NOTICE: APPENDIX 1 CONTINUED

GM NOTICE: APPENDIX 1 CONTINUED

Share ownership requirements

Legacy arrangements

Remuneration policy for other employees

Approach to recruitment remuneration

Executive Director service contracts

Overarching principles

GM NOTICE: APPENDIX 1 CONTINUED

LEAVER AND CHANGE OF CONTROL PROVISIONS

GM NOTICE: APPENDIX 1 CONTINUED

Malus and clawback policies

Pay-for-performance: scenario analysis

Assumptions underlying the scenarios:

Non-Executive Directors

GM NOTICE: APPENDIX 1 CONTINUED

External directorships

Considerations of conditions elsewhere in the Group

Consideration of shareholder views

GM NOTICE: APPENDIX 2

1. THE BONUS PLAN

Status

Eligibility

Bonus opportunity

Grant of Bonus Plan Awards

GM NOTICE: APPENDIX 2 CONTINUED

Malus

Vesting and exercise

Clawback

Cessation of employment

Corporate events

2. THE LTIP

Status

Eligibility

Grant of LTIP Awards

Performance and other conditions

Malus

Vesting and exercise

GM NOTICE: APPENDIX 2 CONTINUED

Clawback

Cessation of employment

Corporate events

3. PROVISIONS APPLYING TO EACH OF THE PLANS

Awards not transferable

Holding period

Limits

SIG PLC Proxy Solicitation & Information Statement 2018