Triodos Renewables plc 2014 Share Issue

October 2014

IMPORTANT NOTICE

This document is approved by Triodos Bank NV for the purposes of section 21 of the Financial Services and Markets Act 2000. Triodos Bank NV (incorporated under the laws of the Netherlands with limited liability, registered in England and Wales BR3012) is authorised by the Dutch Central Bank and subject to limited regulation

by the Financial Conduct Authority (FCA) and Prudential Regulation Authority (PRA). Details about the extent of our regulation by the Financial Conduct Authority and

Prudential Regulation Authority are available from us on request. Registered office: Triodos Bank, Deanery Road, Bristol, BS1 5AS. VAT reg no 793493383.

If you are in any doubt about the contents of this document or the action you should take, you should immediately consult a person authorised for the purposes of the

Financial Services and Markets Act 2000 (as amended) who specialises in advising on the acquisition of shares and other securities.

This document does not constitute a prospectus as defined by the Prospectus Regulations 2005 ’the Regulations’, and has not been prepared in accordance with

the requirements of the Regulations.

To the best of the knowledge and belief of the Directors of Triodos Renewables plc (who have taken all reasonable care to ensure that such is the case), the information

contained in this document is in accordance with the facts and does not omit anything likely to affect the import of such information. The Directors, whose names

appear on pages 27–29, accept responsibility accordingly.

TRIODOS RENEWABLES PLC

Triodos Renewables is a trading name of Triodos Renewables plc, registered in England and Wales, registered office: Triodos Bank NV, Deanery Road, Bristol BS1 5AS

(registered number 2978651)

Offer for Subscription

Initial Offer

of

up to 1,726,839 New Ordinary Shares

of 50p each at £2.28 per New Ordinary Share payable in full on application and available to both Existing Shareholders and new investors in Triodos Renewables

where the minimum subscription per investor is £50.16 (or 22 shares)

and

Second Offer

of

up to 466,143 New Ordinary Shares

of 50p each at 2.28 per New Ordinary Share payable in full on application and available to both Existing Shareholders and new investors in Triodos Renewables

where the minimum subscription per investor is £78,744.36 (or 34,537 shares)

Sponsored by Triodos Bank NV

The distribution of this document in jurisdictions other than the United Kingdom may be restricted by law and therefore persons into whose possession this document

comes should inform themselves about and observe any of those restrictions. Any failure to comply with any of these restrictions may constitute a violation of the

securities laws of any such jurisdiction.

Case study: Avonmouth, Bristol

Our latest project to become operational is our 8.2 MW four turbine site on a sewage treatment plant just seven miles from our head office in Bristol. £3.5 million of the funds raised during our 2012 share issue were invested directly into this £14 million project, with the remainder being provided through a bank loan.

Earlier this year we hosted an open day at our Avonmouth wind farm for the local community, our Shareholders and those involved in delivering the project. We had 130 guests, a third of whom were children, who were entertained with interactive science shows, illustrating climate change and sustainable energy, tours inside the turbines and many other activities. This gave us a fantastic opportunity to engage with and listen to the people closest to our projects.

See a video of our open day at http://www.triodos.co.uk/en/about-triodos/news-and-media/media-releases/families-blown-away-at-triodos-renewables-open-day

Triodos Renewables seeks to allow as many individuals as possible to contribute to building additional sustainable energy generating capacity. The equity required to build the Avonmouth project is equivalent to 375 of our average Shareholder’s investments (based on an average shareholding of 4,000 shares).

We are proud that Triodos Renewables has given so many people the opportunity to come together and to do something meaningful with their investment at Avonmouth and at the other projects developed over the past 20 years.

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Contents

Letter from Simon Roberts OBE – Chair of Triodos Renewables 2

Section 1: Key Information 4

Section 2. Directors, Secretary and Advisers 9

Section 3: Our projects and our growth strategy 11

Section 4: UK Renewable energy market 18

Section 5: Investing in Triodos Renewables plc shares 22

Section 6: Our team 27

Section 7: Financials 30

Section 8: Risk Factors 33

Appendix 1: Definitions and terms 40

Appendix 2: The Share Offers 43

Appendix 3: General information 45

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Letter from Simon Roberts OBE, Chair of Triodos Renewables

Thank you for your interest in our 2014 Share Issue.

Triodos Renewables was founded 20 years ago to make a difference. We offer individuals the opportunity to have a rewarding stake in tackling climate change by investing directly in the UK’s renewable energy infrastructure through a trusted organisation whose priority is the

protection of our environment. We continue to be committed to contributing to a future based on clean, green power in the UK, using the country’s abundant natural resources such as plentiful rainfall and the prevailing westerly winds.

The Company’s business model and financial performance has proven robust and continues to strengthen. Our Shareholders have benefitted from an average dividend yield of 1.7% over the past three years and our share value has steadily increased by 63%1 from £1.40 in 2005 to £2.28 in this Share Issue – this equates to annualised growth of 5.6%. I am also pleased to say that the liquidity in trading of our shares has improved since we decided to join Ethex last year.

Triodos Renewables is also about connecting people to their own energy future. We have built a community of like minded investors and we now have over 5,000 shareholders - we believe this makes us one of the most widely owned renewable energy companies in the UK. Our Shareholders have invested over £30 million since we were established which has helped us to construct 53 MW of renewable energy infrastructure in the UK. With a further four projects in construction, once

1 Based on the Share price as calculated by the Directors in 2005 and 2014

3

operational, our portfolio will generate enough electricity to power around 40,000 homes2. I am extremely proud of these achievements and am keen to see the Company continue to build upon its established legacy.

Recent events in parts of the globe known to be rich in fossil fuels demonstrate the importance of energy security for the UK, and even the most sceptical would realise that ever increasing energy demand cannot be met by the world’s dwindling fossil fuels alone. We are determined to carry on playing our part in building a sustainable energy future and have a number of exciting new projects in development. We are currently constructing four new wind farms with a combined capacity of around 13 MW and have a pipeline of new projects which we hope to develop with support from our existing and new shareholders through this Share Issue.

With our 2014 Share Issue we are now seeking to raise a further £5 million, both from our Existing Shareholders and new investors - money which can be deployed quickly to deliver new projects, new renewable energy generation and grow our income and profits.

Since our first share issue in 1995 we have made a deliberate effort to make investment in Triodos Renewables open to as many people as possible. If we were starting now, we’d call it crowdfunding. We believe in making the opportunity to be part of Triodos Renewables as accessible as possible - which is why we’re delighted to be able to set a minimum subscription for this share issue at just £50.16 – or 22 shares. However most of our shareholders choose to invest more with our average shareholding currently standing at around 4,000 shares.

Triodos Renewables is about enabling people to ‘make a powerful investment’ and we do hope that you will support us and play a role in a more sustainable energy future for the UK.

2 Estimate based on most recent statistics from the Department of Energy and Climate Change showing that annual UK average domestic household consumption is 4,170kWh

4

Section 1: Key Information

Triodos Renewables is a successful and longstanding renewable energy company founded 20 years ago by Triodos Bank NV – one of the world’s leading sustainable banks. During that time, we have used our experience to buy, build and operate a growing portfolio of onshore wind farms and hydroelectric projects.

Today we own eleven renewable energy projects across the UK with a total capacity of 53.4 MW of green power – enough to meet the annual electricity demands of around 34,200 homes3. We are currently constructing a further four wind farms which are due to commence generation over the coming 12 months.

One of our main objectives is to connect more people with renewable energy and we do this by providing a means by which individuals can invest directly in renewable energy generating assets. We currently have a community of around 5,000 shareholders, which continues to grow - we believe we are one of the most widely owned renewable energy companies in the UK. This approach allows people to make a difference with their money while having the opportunity to earn a return on their investment.

We have achieved growth in a number of areas of our business:

Electricity generated (MWh)

0

20,000

40,000

60,000

80,000

100,000

120,000

2006 2007 2008 2009 2010 2011 2012 2013

3 Estimate based on most recent statistics from the Department of Energy and Climate Change showing that annual UK average domestic household consumption is 4,170kWh

5

Turnover (£000)

0

2,000

4,000

6,000

8,000

10,000

12,000

2006 2007 2008 2009 2010 2011 2012 2013

Share value (pence)

0

50

100

150

200

250

2006 2007 2008 2009 2010 2011 2012 2013 2014

Number of shareholders

0

1,000

2,000

3,000

4,000

5,000

6,000

2006 2007 2008 2009 2010 2011 2012 2013

Note: Past performance is not an indicator of future performance.

We are now seeking to raise £5 million which we hope will enable us to acquire and build around 8-10MW of additional renewable energy capacity. Our overall aim is to double our generation capacity to 125 MW by 2020.

6

Why invest?

We have delivered uninterrupted share price growth. Despite the turbulence in the global financial markets, our share value has grown steadily and consistently over the past nine years. Shareholders who invested at £1.40 in 2005 have seen the value of their shares increase by 88p or 63% per share based on the current share price of £2.28. Our Share Issue Price of £2.28 is supported by an independent valuation undertaken by Edison Investment Research Limited (Edison), an independent analyst, research and valuation firm.

We pay consistent annual dividends. We have paid our Shareholders a dividend in eight of the past nine years with an average dividend yield of 1.7% per annum over the past three years.

We believe we offer a secure long term investment. We have £48 million of operational renewable energy generation assets delivering long term, recurring income streams underpinned by both market energy prices and Government backed price support. Wind and hydro are mature, proven renewable energy technologies and are now a favoured asset class for pension providers and other institutional investors in the UK.

The future for renewable energy remains bright. Despite the political scare stories, the UK Government is committed to binding EU renewable energy targets and continues to support the industry. Renewable energy is a fundamental part of the UK Government’s response to climate change and energy security, and is increasingly competitive with conventional sources of electricity.

We know what we are doing. We believe our 20 years of track record in the renewable energy industry gives us tremendous experience in acquiring, developing and operating projects.

Join the crowd. With 5,000 shareholders we believe we are one of the largest community of investors in a renewable energy company in the UK.

We have a strong pipeline of attractive projects. We currently have four wind farms under construction totalling 13.4 MW and have a pipeline of 104 MW.

Save greenhouse gas emissions. An investment of £3,250 in Triodos Renewables will save more greenhouse gas emissions than you are likely to produce in your daily life for a year and will provide enough electricity to power four homes (based on current market conditions and average UK per capita emissions).4

You can trust us. We are managed by Triodos Bank, one of the world’s first ethical banks and still a world leader with over £8 billion of funds under management.

4 Calculated using the most recent statistics from the Department of Energy and Climate Change showing that annual UK average domestic household consumption is 4,170kWh; and on Office for National Statistics figures which show the average number of people per household is 2.4

7

Growing our portfolioOur current projects under construction - two wind farms in Scotland, and two wind farms in the East of England – have enough capacity to generate electricity for an additional 5,500 UK homes. One of the wind farms will be operational later this year and the other three will be operational in 2015.

In addition, we are in advanced negotiations on the acquisition of a further 12 MW of projects and have a total pipeline of around 104 MW of wind, solar and hydro-electric projects across the UK, some of which we hope to secure later this year.

The capital we raise through this Share Issue will be invested directly in these opportunities.

Financial summaryA summary of our recent and projected financial extracts is summarised below.

2011 Audited

£’000

2012 Audited

£’000

2013 Audited

£’000

2014 Forecast

£’000

2015 Projected

£’000

2016 Projected

£’000

Income and expenditure extracts

Income 7,919 8,255 10,104 13,325 15,478 17,832

Operating profit 3,158 2,311 3,568 4,630 6,002 7,528

Profit on activities after tax 757 513 1,586 1,453 2,442 3,332

Earnings per share (in pence*) 4.8 2.8 8.0 7.3 12.2 16.7

Average operating capacity (MW) 34.4 37.7 44.9 53.6 56.9 61.3

Dividend paid (in pence) - 4 2 4 n/a n/a

Balance sheet extracts

Net assets 27,130 30,271 31,395 32,724 35,018 38,084

Gearing 52% 50% 59% 60% 60% 57%

Important notes: Past performance is not an indicator of future performance. Forward looking statements are merely unaudited forecasts and projections and should not be relied upon as indicators of future performance.

Our projections for 2015 and 2016 include the four projects which are currently under construction and due to become operational over the coming 12 months. More detail is included on these projects in section 3.

Share priceThe share price of £2.28 used for this Share Issue is recommended by the Company’s Directors and has been calculated on a discounted cashflow basis which is consistent with all previous valuations and share issues. The £2.28 valuation is supported by an independent external valuation undertaken in August 2014 by Edison who are a recognised city analyst and research firm. Edison recommended a share price range of £2.36 to £2.63 and so, based on this, the Directors are confident that the valuation approach adopted by Triodos Renewables is credible and at the prudent end of the valuation spectrum.

8

Details of the OfferWe are proposing to raise up to £5 million through the Share Issue, which has been structured in the form of two separate offers; the Initial Offer and the Second Offer.

The Initial Offer is for up to 1,726,839 shares, each with a share price of £2.28, with a minimum individual subscription of 22 shares (£50.16). The Second Offer is for up to 466,143 shares, each with a share price of £2.28, with a minimum individual subscription of £78,744.36. Both offers are open to Existing Shareholders and new investors. The Share Issue is structured is this way to comply with the EU Prospectus Directive and prevent the requirement for the Company to produce a full prospectus.

Further informationFor further details, please visit www.triodosrenewables.co.uk or contact Triodos at investments@triodos.co.uk or on 0117 980 9717.

Key risksInvestment in the shares of Triodos Renewables is intended to be for the long term and income from your investment may fluctuate.

A summary of the key risks is shown below.

• Share values may fluctuate – investments in unlisted shares carry a higher risk than investments in listed shares and the value may go up or down. Investing in shares is not the same as investing money in a bank account as your capital is at risk and you may not get back the full amount that you invested as the value of investments and the income derived from them may go down as well as up.

• Liquidity risk – Triodos Renewables is not listed on a recognised exchange. You should be aware that there may be difficulty in selling Ordinary Shares at the share price set by the Directors, and in some circumstances it may be difficult to sell them at any price. You should not invest unless you have carefully thought about whether you can afford it and whether it is right for you.

• Change in Government policy – the Company’s business plan and strategy is based on current and anticipated UK Government and European renewable energy policy. Changes in legislation in relation to renewable energy projects could have a negative impact on the revenues and profits of the Company. The Company’s existing operational projects or those which become operational up to April 2017 are protected from any changes in Government policy since the Government has confirmed that all existing accreditations under the Renewables Obligation will be ‘grandfathered’ meaning that payments under the Renewables Obligation for such projects will be honoured for the life of those projects.

A more detailed list of risks and ways in which the Company seeks to mitigate them is included in Section 8.

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Section 2: Directors, Secretary and Advisers

Directors

Simon Roberts (Chairman)

Matthew Clayton (Executive Director)

Ann Berresford

Peter Weston

Katie Gordon

Colin Morgan

Triodos Corporate Officer Limited

Registered Office

Triodos Bank NV Deanery Road Bristol BS1 5AS

Company Secretary

Triodos Corporate Officer Limited

Arranger and advisor to the Company

Triodos Bank NV Deanery Road Bristol BS1 5ASIncorporated under the laws of the Netherlands with limited liability, registered in England and Wales BR3012. Authorised by the Dutch Central Bank and subject to limited regulation by the Financial Conduct Authority and Prudential Regulation Authority.

Details about the extent of Triodos Bank NV’s regulation by the Financial Conduct Authority and Prudential Regulation Authority are available from Triodos Bank on request at the address shown above.

Manager

Triodos Bank NV Deanery Road Bristol BS1 5AS

Solicitors to the Offers

Michelmores LLP Woodwater House Pynes Hill Exeter EX2 5WR

Auditors

Deloitte LLP 3 Rivergate Temple Quay Bristol BS1 6GD

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Case study: March

In November 2013 Triodos Renewables acquired a new company with rights to develop and build a 1.5MW wind turbine project.

The wind farm is located on an industrial site, which belongs to Greenvale, the UK’s leading supplier of potatoes. The turbine will provide enough energy to power Greenvale’s potato processing facility, providing them with lower cost energy. The remaining energy, around 40% of the total output, will be supplied to the local electricity network. We procured all of the required contracts and began construction work on the site earlier this year and we hope the turbines will be operational by November 2014.

Projects on industrial sites such as March give us the opportunity to deliver renewable energy directly to the industrial hosts (such as Greenvale), reducing their exposure to volatile energy prices, therefore stabilising production costs and contributing to local employment security.

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Section 3: Our projects and our growth strategy

Our projectsWe have eleven operational projects across the UK – ten wind farms and one hydro-electric project with a combined generation capacity of 53.4 MW.5 This is an increase of 39% since our previous share issue in 2012 with three new wind farms – all of which are now operational.

Current projects and assets under construction.

Sigurd

Auchtygills

Beochlich

Dunfermline

Haverigg II

Caton Moor

Wern Ddu

Ness Point

Kessingland

Eye

BoardinghouseMarch

Ransonmoor

Avonmouth

Clayfords

In development

Operational

Hydro scheme

Wind farm

5 Triodos Renewables operates 61MW of renewable generation capacity currently. On occasions the Company has co-invested to allow communities, developers and land owners to participate in projects and therefore Triodos Renewables owns 53MW of the 61MW of operating projects.

12

We have another four wind farms under construction – two of which should become operational later this year, and two to follow next year. This will increase our generating capacity to 61.5 MW.

With this additional capacity each of our 5,000 shareholders will generate almost enough renewable electricity for their own home and their 7 neighbours.6

We focus on low-risk mature renewable technologies such as onshore wind and hydro-electric which provide proven financial returns. In recent years we have achieved wider geographic diversification across the UK which mitigates our exposure to localised weather conditions. A third of our projects are located on industrial sites where there are fewer aesthetic issues and where supply can be provided close to energy demand - this continues to be a key part of our strategy moving forward.6

Our eleven existing projects generated 113,345 MWh of green power in 2013 – this represents an increase of 22.4% on generation in 2012

Electricity generated

Wern Ddu

Kessingland

Dunfermline

Eye

RansonmoorAvonmouth Beochlich

Haverigg IINess Point

Caton Moor

Sigurd

6 Calculated using the most recent statistics from the Department of Energy and Climate Change showing that annual UK average domestic household consumption is 4,170kWh; and Office for National Statistics figures which show the average number of people per household is 2.4

13

Our renewable electricity generation saves more green house gas emissions than our shareholders produce in their daily lives.7

Note: Avonmouth, Eye and Ransonmoor were being constructed during 2013 and therefore did not contribute 12 months of generation to the 2013 figures. If these projects had been operational for the full year, generation for 2013 would have exceeded 137,000 Mwh.7

Income

0

500

1,000

1,500

2,000

2,500

3,000

3,500

4,000

Beochlich

Haverigg II

Ness Poin

t

Caton M

oor

Sigurd

Wern

Ddu

Kessingla

nd

Dunferm

line

Eye

Avonmouth

£'00

0

2012 2013

Total income in2013: £10.1 million

7 Based on DECC statistics at July 2013 which show 0.483 of CO2 emissions are saved per Mwh of electricity produced; and statistics from the world bank which show emissions per capita of 7.9 tonnes of CO2

14

New assets under constructionWe have four sites under construction and due to become operational over the coming 12 months. Together these projects will add a further 8.1 MW of capacity to our portfolio taking our total capacity to 61.5 MW.

Project March

Location: March, Cambridgeshire Turbines: Single turbine

Acquired: November 2013 Total project cost: £4.5m

Capacity: 1.5 MW

See page 10 for the detail on this project.

Project Boardinghouse

Location: Isle of Ely, Cambridgeshire Turbines: Five turbines

Acquired: February 2013 Total project cost: £16m

Capacity: 10.25MW

This project is located on a farm – Triodos Renewables has agreed a project structure plugging a funding gap which has enabled the landowner and developer to maintain a significant stake in the project. We have acquired a 55% stake in

15

the project. Construction began on the site in June this year and the turbines are scheduled to become operational by September 2015. This will be one of our largest sites at 10.25MW (our stake equates to 5.6MW) – we expect the project to generate enough electricity to power 6,900 homes.8

Scottish projects (Auchtygills and Clayfords)

Location: Aberdeenshire, Scotland Turbines: Two turbines

Acquired: 2006 Total project cost: £3.2m

Capacity: 1.6 MW

We invested in these two projects in 2006 prior to planning consent being granted in 2011 – we are now delighted that we have commenced construction. The two projects are held in a subsidiary company of Triodos Renewables, Triodos Mellinsus Projects Limited, of which we own 60%. We plan for both projects to be generating electricity in spring 2015. These projects, being based in Scotland, will further enhance our geographical diversity.

Further growth opportunitiesWe are in advanced negotiations on a further 12 MW of projects in the UK – if we secure these projects we would hope to commence construction in spring 2015 and for them to become operational in 2016. The cost of these projects is likely to

8 Estimate based on most recent statistics from the Department of Energy and Climate Change showing that annual UK average domestic household consumption is 4,170kWh

16

be around £20 million, which would be funded through a combination of capital raised through this Share Issue and bank loans. We are currently bidding for a number of other wind and hydro projects and hope to secure a number of these in the coming months.

Our future strategyOur future strategy has a number of strands:

• Capacity – we want to double our renewable energy generation capacity to 125MW by 2020. We are confident that our current pipeline of opportunities and relationships with developers will enable us to achieve this. Our existing pipeline includes onshore wind, hydro-electric and solar projects. We will only invest in projects which already have planning consent, a grid connection offer and the required property rights.

• Technology – we will continue to focus on the UK and on mature renewable technologies such as onshore wind and hydro but will also continue to look at solar PV and other technologies and geographical areas as opportunities arise.

• Industrial sites – we will continue to prioritise industrial site developments where possible, recognising that the aesthetic impact of the infrastructure is lower.

• Community – our aim is to double our number of shareholders from 5,000 to 10,000 by 2020. To achieve this, we need to make sure we continue to pay consistent dividends, continue to grow our portfolio of environmentally performing projects and develop a well functioning secondary market for our shares. We have already seen some improvements in the secondary share market since joining Ethex in 2013 with a larger number of trades occurring.

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Community engagement

We are committed to working with both our community of engaged Shareholders and with communities close to our projects. We have always recognised the importance of these relationships and have undertaken a number of ad hoc initiatives such as providing funding for a small scale school wind turbine and welcoming guests on site for open days and both school and university visits.

Recently we have developed a more formal policy around community engagement which we believe will offer a more focused and transparent approach to delivering the greatest beneficial impact. The key aspects of this policy are to:

• provide funding for local initiatives which are aligned with our values, create genuine community benefit and where project consultation has identified a desire for such funding;

• engage with schools close to our projects and agree bespoke support for their curriculum learning such as delivery of a renewable energy science show or a visit to our site;

• support programmes to deliver awareness of energy efficiency, behavioural change and implementation of appropriate measures to households which may derive the greatest benefit;

We hope this will help to raise awareness of climate change amongst younger generations and how we can all do our bit to help protect our environment.

Our open day at Avonmouth was very successful and provided a good example of how we can engage the local community.

At our Wern Ddu site in North Wales we make an annual contribution to a local community fund. The funds are spent on projects that will directly benefit the local community such as renovating the community centre and providing workshops and sports equipment for local children.

Each year we host our Annual General Meeting at various locations around the country including our head office in Bristol or close to one of our operational projects. At these interactive meetings we invite each of our Shareholders to come along to hear in person what we have been up to, to meet our team and have the opportunity to ask any questions they may have. A number of our Shareholders attended our AGM this year in June, which was followed by a site visit to our new wind farm at Avonmouth, giving them the chance to get a tangible sense of what their investment can achieve.

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Section 4: UK Renewable energy market

Renewable energy in the UK remains a high growth market and the UK is ranked as the second most attractive market for renewable energy in Europe (after Germany) by the Ernst & Young 2014 Renewable Energy Country Attractiveness Index.9

The UK has a binding EU target to deliver 15% of energy demand from renewable sources by 2020.10 In 2013 a record 5.2% of energy generation came from renewable sources – up from 4.2% in 201211 - however there is clearly still a long way to go to reach the 15% target.

These targets are driven by recognition in the UK and wider EU that there is a need to improve security of energy supply, reducing reliance on imported and depleting fossil fuels, and to reduce greenhouse gas emissions from electricity generation. These fundamental drivers have influenced policy across all administrations for the past 25 years.

Earlier this year the EU proposed a greenhouse gas emission reduction target of 40% below 1990 levels by 2030 – this represents a doubling of the current 20% target set for 2020 and demonstrates that the EU remains committed to tackling climate change.

9 EY Renewable Energy Country Attractiveness report 2014

10 2009 EU Renewable Energy Directive

11 UK Renewable Energy Roadmap, update 2013 – November 2013

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UK renewable electricity capacityBy 31 December 2013 UK renewable electricity installed capacity reached 19.7GW. As shown in the table below, the majority of this increase in installed capacity came from onshore wind.

Total UK renewable electricity capacity 19.7GW at 31 December 2013 (27% increase on 2012)

0

1

2

3

4

5

6

7

8

Onshore w

ind

Offshore

win

dSola

r

Hydro

Landfill g

as

Biom

ass

Energy fr

om w

asteOth

er

Gig

awat

ts

2011 2012 2013

Source: DECC Energy Trends – June 2014

20

Growth in renewable infrastructure continues to be supported by the UK Government through a range of pricing support mechanisms – although these are gradually reducing as the industry matures, as established renewable technology costs fall and as wholesale power prices increase over time.12 All of these factors demonstrate the success of renewable energy in becoming increasingly competitive compared to fossil fuel based alternatives – with the added benefit it provides to UK of energy security and less exposure to volatile fossil fuel prices.

There is considerable new renewable capacity coming on-stream in the UK – according to DECC there are currently around 3,880 applications totaling 39.9GW of potential new capacity for which planning has been approved.13 Triodos Renewables is well placed to contribute to the growth in new capacity – especially in smaller to medium sized (2MW to 20MW) projects.

Government policy and the UK renewable energy outlookThe UK Coalition Government has confirmed that it continues to be committed to supporting investment in renewables as part of a diversified future energy mix, and is to work towards the UK’s 15% target for renewable energy generation by 2020. We believe it is likely that a new UK Government would continue with this broad policy not least because renewable energy is one of the most cost effective means of achieving the binding greenhouse gas emission reduction targets.

Currently, there are two support mechanisms for new renewable energy projects. The Renewables Obligation scheme applies to larger projects, specifically wind projects over 5MW, while the Feed-in Tariff (FIT) scheme supports smaller projects.

Following an extensive consultation process, during 2014 the UK Government has started implementing changes in the way that the renewable energy sector will operate – known as Energy Market Reform (EMR).

12 Poyry Energy Reports 2014

13 https://restats.decc.gov.uk/app/pub/repd/index/tab/overview

21

The technical detailsEMR will replace the UK Government’s previous support mechanism for renewable energy (known as the Renewables Obligation) entirely in 2017. The EMR’s objective is to deliver a lower carbon energy sector in a financially efficient manner. This has already resulted in the reduction of the financial support available to renewable energy projects and we predict that this will continue. We believe this is a logical consequence of the increasing competitiveness of the proven renewable technologies and is crucial to achieve sustainability.

After 2017 the new EMR system will take over from the Renewables Obligation. Under EMR renewable energy projects over 5 MW in capacity will benefit from a Feed-in Tariff Contract for Difference (FIT CfD) where the projects will receive the fixed price for electricity generated for 15 years, with compensation being received or paid to balance market price volatility, therefore delivering price stability for the project whilst maintaining alignment with the underlying market price. Within the EMR, projects with a capacity of 5 MW and below will continue to be eligible for the FIT, a fixed price for the first 20 years of operation.

Impact on our projects and prospects79% of our existing projects benefit from payments under the Renewables Obligation. The changes discussed above with the introduction of the EMR will not affect our existing operational projects or any Renewable Obligation projects which become operational before April 2017. This is because the UK Government has confirmed that all existing accreditations under the Renewables Obligation will be ‘grandfathered’ (or honoured) and that new accreditations for existing Renewables Obligation will be accepted up to 2017. This provides a level of certainty over our income up to 2037.

For our projects which become operational beyond 2017 the Renewables Obligation will be superseded by the FIT CfD which will provide power price security payments for renewable energy.

We believe that the continued adjustments to energy market policies are part of the evolution of ‘alternative technologies’ to proven technology aimed at sustainably integrating them into the energy system.

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Section 5: Investing in Triodos Renewables plc shares

Triodos Renewables is an unlisted company which means that our shares are not quoted on an investment exchange, such as the Official List of the London Stock Exchange or AIM. Instead, our shares can be traded through a Matched Bargain Market where investors can buy and sell our shares on a basis whereby registered sellers are matched with registered buyers. The Matched Bargain Market method of dealing in shares is used by several other unlisted social and environmental businesses and is marketed by Ethex and operated by Capita Asset Services.

Capital raisingWe have raised over £30 million of equity funding through a series of share issues since the Company’s inception in 1994. Below is a summary:

Date Issue Price

Amount raised (£m)

Projects invested in

1995 £1.00 0.5 Beochlich

1998 £1.30 2.4 Haverigg

2005 £1.40 4.7 Ness Point, Caton Moor, Sigurd

2008 £1.65 9.9 Wern Ddu, Kessingland

2009 £1.75 4.4 Kessingland, Dunferline

2011 £1.80 6.5 Eye, Avonmouth

2012 £1.90 3.5 Avonmouth, Boardinghouse, March

31.9*

* Before share issue costs of approximately £1.4m.

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Share valuationIn previous years our Issue Price has been calculated by the Directors each time we undertake a share issue, and when other material events occur. This valuation is based on a comprehensive discounted cash flow valuation and takes into account only our existing projects (operational and those under construction).

In addition this year we commissioned an independent external valuation of our share price for the first time with Edison Investment Research Limited – a recognised city analyst and research firm. Edison performed the valuation in August 2014 and provided a valuation range for our share price of £2.36 to £2.63, based on a range of alternative methodologies.

This valuation provides an objective view of our share Issue Price and should provide shareholders with an additional degree of comfort over the £2.28 valuation recommended by the Directors for this share issue.

We are now seeking to raise a further £5 million of new equity through this Share Issue to invest in new projects in our pipeline.

Liquidity

As mentioned above, our shares are offered through a Matched Bargain Market which is marketed by Ethex and operated by Capita Asset Services. In the twelve months to 31 July 2014 185,620 shares were traded on the Matched Bargain Market representing around 1% of the total number of shares now in issue. The weighted average traded price for these trades was £1.75 representing 92% of the share price agreed by the Directors for the 2012 share issue. Most transactions on the Matched Bargain Market occur at varying prices below the Issue Price agreed by the Directors in the preceding share issue.

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In 2011 we introduced a Buy-back scheme to improve the liquidity of our shares. Following each share issue typically a maximum of 5% of funds raised is allocated to a buy back pool to acquire shares which have remained unsold on the Matched Bargain Market for at least 12 months. The buy back offer is set at a price equivalent to 90% of the Share Issue Price. This scheme is subject to the approval of the Board for each Share Issue. The Executive Management team will be recommending a share Buy-back following the 2014 Share Issue – this will be subject to the approval of the Board

In line with our mission to connect more people with their energy future and grow our community of investors, we are partnering with Trillion Fund (a crowd funding platform specifically for renewable energy projects), as well as Ethex.

We believe these partnerships will not only help attract a larger community of like-minded investors through social media and other distribution channels, but will also help to increase the liquidity of our shares in the future.

Shareholder returnsWe aim to provide our Shareholders with an investment which has a dual benefit - a benefit to the environment by helping to increase renewable energy generation in the UK, and the provision of a commercial financial return.

This financial return is generated through a combination of annual dividends and share value growth. The below table shows the growth in our share value over recent years, as determined by the Directors, and the dividends which our Shareholders have received.

Capital growth and dividends

2006 2007 2008 2012 20142013

Div

iden

d pe

r sh

are

(pen

ce)

Sha

re v

alue

(pen

ce)

Dividend Share price

2011201020090

0.5

1

1.5

2

2.5

3

3.5

4

4.5

100

120

140

160

180

200

220

240

Note: Past perfomance is not an indicator of future performance.

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Our Shareholders have received an average dividend yield of 1.7% over the past three years. No dividend was paid in 2011 as 2010 was an exceptionally poor wind year in the UK.

Capital returnTriodos Renewables shares are a long term investment. Over time our Shareholders typically receive a capital return on their shares as the share value appreciates. This capital return will only be realised when a Shareholder sells their shares and will depend on the value for which their shares are sold on the Matched Bargain Market, or through the Buy-back scheme.

ExampleAn investor who bought 2,000 shares at a share price of £1.40 in 2005 and sells them this year as part of the Buy back scheme would receive the following returns:

Investment made in 2005 £2,800

Total dividends received between 2006 and 2014 £440

Shares sold in 2014 £4,100*

Capital gain on investment £1,300

Total combined dividend and capital return £1,740

This equates to a total return of 5.8% per year for nine years

* This assumes the shares are sold in 2014 by an eligible seller as part of the Buy back scheme at 90% of the current share price (£2.05) and that the sale occurs following payment of the 2014 dividend

Note: There is no guarantee that the share value will appreciate. The value of the Shares may go up or down. The actual return received is dependent on the share price at which the shares are sold. It may not be possible to achieve the share price used for the above calculations or to sell at any price. Past performance is not a reliable indicator of future performance.

Shareholder returnsThe long term aim of the Directors is to deliver average annual returns of 9-10% to our Shareholders through a combination of dividends and capital growth. When referring to the long term, we envisage this to be over a 15-20 year period in line with the life of the assets we invest in.

In the shorter term, shareholders who wish to sell their shares on the secondary market or at a discount through the Share Buy back scheme are achieving between 5% and 6% as demonstrated in the above example. The Directors are committed to improving the functioning of the secondary market with a view to seeing transactions taking place more quickly and at a representative valuation. The externally commissioned valuation report from Edison, which gave a share price range of £2.36 to £2.63, is part of this strategy and aims to offer new investors greater visibility of the value of the Company through an independent valuation and substantiation of the Directors’ recommended Issue Price of £2.28.

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Future strategyThe Board is committed to providing a satisfactory secondary market for shares in Triodos Renewables and continues to seek improvements in transparency, liquidity and ease of administration. As part of this we regularly consider listing on an exchange such as AIM. To date we have concluded that it would not currently be in the interests of our Shareholders to do so. However we continue to monitor the situation with a view to providing a well functioning secondary market for shares and may deem listing to be an appropriate option in the future.

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Section 6: Our team

Board of DirectorsThe current Board comprises the following Directors.

Simon Roberts OBE – Chairman

Simon has spent more than 30 years helping people, organisations and policymakers to change the way they think and act on energy. He is Chief Executive of the Bristol based Centre for Sustainable Energy, one of the UK’s leading energy charities. Simon was formerly Managing

Director of Triodos Renewables until 2002, when it operated as the Wind Fund plc. He became a Non-Executive Director of Triodos Renewables in 2009 before becoming Chairman in 2012.

Simon is an advisor to energy regulator Ofgem and a number of government and academic programmes. He was a leading member of the Government’s Renewables Advisory Board (2002-2010) and recently set up and chaired the Community Energy Finance Roundtable, reporting to DECC and Cabinet Office ministers in July 2014. He was awarded an OBE in 2011 for services to the renewables industry.

Matthew Clayton – Executive Director

Matthew has worked in the Triodos Renewables team since 2006 and undertakes the overall management of Triodos Renewables Plc. In his former role as Operations Director, Matthew led the project development, construction and operation of the Company’s portfolio. Prior to joining

Triodos Bank, Matthew was part of a small team which established Camco International, one of the world’s leading carbon trading companies, focusing on supporting sustainable energy projects via the Kyoto framework. Before this Matthew worked in Risk Management for TXU’s Energy Trading team.

Non-Executive Directors

Ann Berresford

Ann has over 25 years experience in financial management across the financial services and energy sectors. Until 2006, she was Finance Director for the Bank of Ireland’s UK Financial Services Division and for Bristol and West plc. Prior to that, Ann held a range of senior

roles in Clyde Petroleum plc, an independent British oil and gas exploration and production company, including Group Treasurer and Finance Director for the Dutch operations, based in The Hague. Ann is now a non-executive director at the Pensions Regulator, Bath Building Society and at Hyperion Insurance Group. She is also an independent trustee to the local government Avon Pension Fund, administered by Bath and North East Somerset Council. Ann read Chemistry at Liverpool University and is a qualified Chartered Accountant.

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Peter Weston

Peter has 19 years experience working in the energy and renewables markets as an investor, lender and strategic adviser. He is currently global head of finance and investment in the power division of MAN, a leading supplier of engines for flexible and decentralised power

plants. Prior to this he was responsible for customer financing solutions at Siemens Wind, a global manufacturer of onshore and offshore wind turbines. He led the energy lending division of GE Capital in Europe and was an executive director for Westdeutsche Landesbank’s energy group. Peter has a BA in Economics and Politics from the University of Warwick.

Katie Gordon

Katie is Director of Responsible Investment and Stewardship at CCLA, the top rated UK fund manager for Socially Responsible Investment (SRI) (Extel 2013), where she is leading the public health engagement programmes and helping expand the segregated client business. Prior

to joining CCLA, Katie was head of SRI at Cazenove Capital Management for 12 years, where she initiated, led and developed the SRI offering across the entire investment process. Katie was a founder director of Swordfish, a brand strategy consultancy, and is currently the independent member of the Investment Committee of Durrell Wildlife Conservation Trust.

Colin Morgan

Colin has worked in the renewable energy industry since 1987 and currently manages one of the global regions for DNV GL - the world’s leading renewable energy consultancy. He is a Chartered Mechanical Engineer having studied at Imperial College London. Through his career his work has

spanned an array of areas including wind turbine design and analysis; research into wind farm wake effects; wind and energy resource assessment; policy and strategy; technical due diligence of projects; and construction management. He also built and led a multi-disciplinary team of consulting engineers in offshore wind projects. Colin has sat on various industry bodies including the RenewableUK Offshore Wind Strategy and Delivery Groups.

Triodos Corporate Officer Limited

Triodos Corporate Officer Limited (a wholly owned subsidiary of Triodos Ventures BV, a company controlled by Triodos Bank) nominates a representative to the Board, currently Charles Middleton, the Managing Director of Triodos Bank in the UK.

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Executive Management TeamTriodos Renewables is managed by Triodos Bank NV in accordance with a management services agreement under which the Bank provides management, operational, finance and administrative services through a Management Team which is based at the Bank’s head office in Bristol. The Management Team plays a key role in business development through identification of acquisition targets and strategic development partners, bidding for projects and providing recommendations to the Board. All new investments require formal Board approval.

Key members of the Triodos Management Team are as follows.

Matthew Clayton – Executive Director

See above in the Board section.

Katrina Cross – Finance Director

Katrina joined the Bank in 2012 as Head of Finance and Operations for Investment Management UK which provides the financial and administrative support functions to Triodos Renewables and investment funds managed by the bank in the UK. Katrina is a qualified accountant, trained with a

general practice and Coopers & Lybrand tax division and spent seven years with Watts Gregory as head of audit with a wide range of clients. Prior to joining Triodos, Katrina spent seven years as a Finance Director of an environmental company that remediated contaminated land. Working at Triodos enables Katrina to work towards providing robust financial returns to investors whilst delivering strong social and environmental benefit.

Monika Paplaczyk - Investment Manager

Monika joined the Bank in 2007. In her role as Investment Manager, Monika focuses on originating investment opportunities within the sustainable energy market for Triodos Renewables, performing the investment valuations and negotiations and due diligence of new investments.

Monika is also responsible for managing a portfolio of companies and projects within Triodos. Before joining Triodos Monika worked in Edinburgh for a consulting company where she was mainly involved in preparing business plans and grant applications for community development projects, biomass and grain storage.

Adrian Warman – Operations Manager

Adrian joined Triodos Renewables in 2012 as Operations Manager in response to the growing portfolio of generating sites around the country. The role of Operations Manager is to ensure contracts are in place and fulfilled to maintain our operating assets in line with legislation and industry

standards, allowing them to run most efficiently and productively over time. Adrian has a degree in Geography, Certificate in Management Studies and applied experience of contractor management, Health & Safety, systems development, resource management and logistics. Prior to joining Triodos Renewables Adrian spent seven years at a senior level in the energy efficiency sector with a leading carbon reduction company.

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Section 7: Financials

Financial overviewA summary of our recent and projected trading performance is set out below. You should note that past performance is not necessarily a reliable indicator of future results.

Past and projected performance

2011 Audited

£’000

2012 Audited

£’000

2013 Audited

£’000

2014 Forecast

£’000

2015 Projected

£’000

2016 Projected

£’000

Income

Operational assets 7,919 8,255 10,104 13,210 13,784 14,473

Assets under construction - - - 115 1,694 3,359

Total income 7,919 8,255 10,104 13,325 15,478 17,832

Operating profit

Operational assets 3,158 2,311 3,568 4,633 5,028 5,603

Assets under construction - - - (3) 974 1,925

Total operating profit 3,158 2,311 3,568 4,630 6,002 7,528

Interest receivable 5 53 11 20 11 15

Interest payable and similar charges (1,778) (1,641) (1,989) (2,834) (2,961) (3,396)

Other income - 120 142 - - -

Profit on activities before tax 1,385 843 1,732 1,816 3,052 4,147

Tax (628) (330) (146) (363) (610) (815)

Profit on activities after tax 757 513 1,586 1,453 2,442 3,332

Earnings per share (in pence*) 4.8 2.8 8.0 7.3 12.2 16.7

Average operating capacity (MW) 34.4 37.7 44.9 53.6 56.9 61.3

* The Earning Per Share (EPS) is the profit after tax and minority interests divided by the total weighted average number of shares for the year. This is essentially the profit attributable to each share. The Directors consider the dividend annually based on the current performance of the Company and its expected future commitments. A portion of the profit will be reinvested in the Company to allow for future growth, and the balance will be paid out annually to shareholders as a dividend.

The information contained in this table shows audited financial information taken from the past three Triodos Renewables audited Annual Reports. Forward looking statements are merely unaudited forecasts and projections and should not be relied upon as indicators of future performance.

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2013 was a record year for Triodos Renewables as we generated more than 100 million units (kWh) of renewable electricity and our income reached over £10 million for the first time. Income levels increased by 22% in 2013 - this was due both to the additional capacity from our three new wind farms and increased generation from our existing sites.

The 2014 forecast comprises six months of actual figures to 30 June 2014, and six months of forecast numbers. We have had a strong first half of the year generating 79,689MWh of electricity, with income of £6.5 million and profit after tax of around £955,000.

Our projections for 2015 and 2016 assume the four projects currently under construction (Boardinghouse, March, Auchtygills and Clayfords) become operational over the coming 12 months.

Projected trading performance

Actual and forecast electricity generation (MWh)

Ele

ctri

city

gen

erat

ion

(MW

h)

0Actual2012

Actual2013

Target2014

Target2015

Target2015

Auchtygills

Clayfords

Boardinghouse

March

Ransonmoor

Avonmouth

Eye

Dunfermline

Kessingland

Wern Ddu

Sigurd

Ness Point

Caton Moor

Haverigg

Beochlich

20,000

40,000

60,000

80,000

100,000

120,000

140,000

160,000

180,000

200,000

The above table does not include any of the projects in our current pipeline. Beyond 2016 we are confident our electricity generation will increase further still as some of our existing pipeline of projects comes to fruition over the coming years.

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Balance sheetOur balance sheet continues to grow as we invest in new renewable energy assets. Below we set out a summary.

2011 £’000

Audited

2012 £’000

Audited

2013 £’000

Audited

Fixed assets 46,793 56,037 67,074

Cash 9,688 8,239 10,691

Other current assets 5,715 6,112 6,530

Bank and other loans (29,812) (30,293) (45,622)

Other Creditors (5,254) (9,824) (7,278)

Net assets 27,130 30,271 31,395

Gearing* 52% 50% 59%

*Gearing has been calculated as total debt as a proportion of net assets plus total debt.

We continue to manage a healthy cash balance to cover our working capital and loan repayment commitments. Some of the cash balance at 31 December 2013 will be invested in our March and Boardinghouse projects under construction.

Our gearing increased in 2013 as we drew down additional bank debt and took on £7 million of mezzanine loan finance. This has been used to finance the four projects we have under construction which will add 8.1MW to our operating capacity over the coming 12 months.

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Section 8: Risk Factors

The Directors believe that the principal material risk factors relevant to investing in Triodos Renewables are those set out below.

In addition to the other relevant information set out in this document the following specific risk factors should be considered carefully in evaluating whether to make an investment in the Shares. If you are in any doubt about the contents of this document or the action you should take, you are strongly recommended to consult your financial or other professional adviser.

The following risk factors should be considered but it should be noted that these are not exhaustive and not in any particular order of priority.

Risks relating to Ordinary Shares and the Company

1 Share values fluctuate

Investors considering an investment in Triodos Renewables should recognise that the value of our Shares may fluctuate and the market price a willing purchaser may offer to pay for the Shares may not always reflect the underlying net asset value of the Company.

The value of Shares may go up or down. Because of this you may not get back the full amount you invest. The Shares are intended to be a long-term investment. It may be hard to sell or realise your investment and to obtain reliable information about its value or the extent of the risks to which it is exposed. Ordinary Shares may be traded on an unregulated share exchange called the Matched Bargain Market as described in Section 5, which means there are not always intermediaries who are willing to buy and sell Ordinary Shares. If you want to buy or sell Ordinary Shares, you will need to wait for an interested seller or buyer or apply to the Company under the Buy-back scheme.

Successful applicants for New Ordinary Shares may suffer dilution as a result of further fundraisings or share issues by the Company in the future should the Company require to raise further funds to achieve its aims as set out in this document. Any such further share issue could have an adverse effect on the value of Shares in the Company. However the Board aims to deploy capital raised in assets which generate attractive returns and benefit all Shareholders through share value appreciation and profits available for distribution.

2 Liquidity

Triodos Renewables is unlisted. You should be aware that there may be difficulty in selling Ordinary Shares at the share price set by the Directors, and in some circumstances it may be difficult to sell them at any price. You should not invest unless you have carefully thought about whether you can afford it and whether it is right for you.

The Board is committed to providing a satisfactory secondary market for shares in Triodos Renewables and continues to seek improvements in transparency, liquidity and ease of administration. As part of this we regularly consider listing on an exchange such as AIM. To date we have concluded that it would not currently be in the interests of our Shareholders to do so. However we continue to monitor the situation with a view to providing a well functioning secondary market for shares and may deem listing to be an appropriate option in the future.

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A Share Buy-back scheme has also been introduced to improve liquidity.

3 Loss of key staff

The development and management of the Group’s business is a specialist activity. Losing specialist staff from Triodos Bank could prejudice the Group’s profitability. In addition to the people directly engaged in the management of the Group in the UK, Triodos Bank has, throughout the companies it operates, a number of experienced renewable energy finance professionals who are able to support the core UK team. This international team helps make sure that high-quality investments are consistently made across Triodos Bank’s renewable energy portfolio. These other personnel would be able to provide management services in the event of loss of key staff within the UK.

4 Taxation

The information in this document is based upon current tax and other legislation and any changes in the legislation or in the levels and basis of, and reliefs from, taxation may affect the value of an investment in the Company, and returns to investors.

5 Investment risk

Triodos Renewables invests in consented renewable energy projects, many of which are at pre-construction stage.

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We seek to mitigate the risk of any such investments by thoroughly assessing the viability of business plans using independently sourced operating data and costings and by closely monitoring performance post investment. We also look to apportion the risk with the seller as far as possible. The Company has a good track record over the last five years in the delivery of projects.

Risks relating to the renewable energy industry

1 Government policy towards renewable energy may change unfavourably

Our business plan and strategy is based on current UK Government and European renewable energy policy. Changes in respect of legislation concerning Renewable Obligation Certificates (ROCs), the feed-in tariff (FIT), the EMR and UK planning law in relation to renewable energy projects could have a negative impact on the revenues and profits of some of our operating projects.

However, there is a global consensus on taking action on climate change and energy security, which has positively influenced Government and European Union policy. The UK Government has made certain commitments to ROCs and the FIT which are underpinned by a European Directive to achieve 15% of energy from renewables by 2020. ROCs and FIT are subject to regular review though all UK Governments have been consistent in avoiding changes which impact projects retrospectively by adopting a grandfathering policy for operational projects.

36

The Energy Market Reform has been introduced and received Royal Ascent last year. This moves away from the Renewables Obligation for projects over 5MW commissioned after March 2017. However, payments made under the Renewables Obligation are being grandfathered and will continue until 2037.

Around 54% of the Company’s income is generated from the energy market through Power Purchase Agreements which are not impacted by Government policy.

2 Reliance on variable resources such as wind speed, rainfall and sunlight

Climate variability and fluctuating long-term weather patterns could reduce the profitability of the whole portfolio. There is no consensus evidence in historical records nor indication from climate modeling of declining trends in the average wind or rainfall conditions. To mitigate the impact of regional variations from year to year we have invested, and seek to invest, in a variety of projects and geographical locations which would give some protection against these changes.

We conduct a thorough due diligence process including one year of actual wind data and a review of relevant long-term correlated wind resource data prior to making an investment. This includes the use of external specialists and resource assessments to determine, to the extent possible, the appropriateness of any site. This work measures, among other things, potential renewable energy generation and other factors associated with any site.

3 Technology failure

Generation of electricity involves mechanical and electronic processes which may fail under certain conditions and lead to loss of revenues and repair or replacement costs. We use tried-and-tested technologies backed by warranty and service packages. We also source from a range of equipment providers to limit the impact of serial faults.

Generally, warranties will guarantee a level of technical performance for between five and fifteen years and we procure specialist operations and maintenance services. We also buy specialist insurance to seek to mitigate against any losses (cost of repair and lost generation/revenues).

4 Availability of appropriate investment projects

In certain circumstances there may be a shortage of appropriate or profitable investment or development projects. In this case, the overall return available to the Company could suffer because it holds too high a proportion of uninvested cash.

However, through a good understanding of the renewables market, strong industry-wide relationships and a pipeline of projects under exclusivity and negotiation, we aim to secure sufficient quality and quantity of projects or investments. If we did not have appropriate projects in which to invest we would deploy the capital raised in paying down debt, which would increase the profitability of the Company.

5 Fluctuating market conditions

The wholesale prices of electricity and gas, which have an impact on sale prices for the Group’s electricity and other potential revenue streams, fluctuate. This may lead to volatility in some of the revenue streams within our portfolio.

We seek to enter into medium or long-term (10-15 year) contracts with our customers to stabilise the effect of these changes. Through the portfolio, we aim to diversify the contract structure to help mitigate the exposure to price volatility.

37

6 Foreign exchange risk

We purchase capital equipment, including wind turbines, in currencies other than pounds sterling, particularly the euro. Accordingly, foreign exchange risk arises. We do not hold foreign currency and only enter into forward exchange contracts on completion of acquisitions or signing of turbine supply contracts. However, we aim to manage this risk on an individual project-by-project basis through the fixing of exchange rate exposure in contract negotiations and contractual agreements.

7 Environmental risks

Adverse environmental conditions at any of the properties used by the Group for renewable generation may negatively affect the Group’s business and profitability. We employ proven technologies designed to prevail in adverse environmental conditions.

We normally commission specialist environmental consultants to report on these matters before entering into any contract committing the Group to material financial expenditure. We also hold specialist insurance to mitigate our exposure in the event of loss.

8 Legal risk

The Group is exposed to legal risks in the conduct of its business. These legal risks could potentially involve, but are not limited to, disputes relating to environmental matters, nuisance or negligence claims. These risks are often difficult to assess and their existence and magnitude often remain unknown for substantial periods of time.

We take our legal obligations seriously and seek legal advice when we consider it appropriate.

9 Development and construction partner risk

Development and construction of wind and other electricity generation projects is invariably a challenging process involving significant input by and reliance on development partners. In the event that one party does not perform its obligations adequately or at all, the success of a project may be put in jeopardy. This can have a significant effect on the Group’s financial results and lead to a loss of its investment.

We select our development and construction partners carefully and take into account their experience and track record in similar projects and financial capabilities. We also insist on collateral warranties and, where appropriate, guarantees against non-performance under contracts. Through the development and construction phase, we closely monitor our partners and contractors and their work. We have a level of protection against liquidation risk of development partners through an ability to take over projects in pre-defined conditions.

We maintain a strong network of parties which could substitute/replace these functions in the event of failure.

10 Supply of Capital Equipment

Delays in obtaining turbines, turbine parts or services and other capital equipment from suppliers and manufacturers have been common in the industry in the recent past. This may re-occur and lead to reduced revenues or missed opportunities.

We are constantly in discussion with various manufacturers to remain abreast of industry lead times so that we can identify appropriate measures to mitigate any such delays and, if necessary, identify alternative suppliers of parts and services.

38

The agreed contractual frameworks include requirements to notify us of potential difficulties and incentives for adherence to agreed schedules.

11 Realisation risk

There is a risk that the Company may not be able to realise its investments in the planned timescales or at a time beneficial to it.

This may have a negative impact on the Group’s financial results and cash flows. We have a pipeline of investment opportunities on which we hope to deploy funds and a strong track record of deploying capital in a timely manner.

12 Operating risk

There are risks associated with operating facilities where an accident or incident might result in the facility being shut down for investigation and/or repair.

We have a diversified portfolio of assets, currently operating 11 projects, increasing to 15 projects within the coming 12 months. This diversification means that the Company’s performance is less exposed to any one asset. We also take out insurance against loss of revenue caused by turbine or other major equipment failure. In the event of the liquidation of third party contractors we have the ability to quickly engage alternative providers.

13 Health and safety

The Group is involved in the operation and maintenance of large items of mechanical and electrical equipment, such as wind turbines. This gives rise to potential health and safety risks for staff and contractors who are involved. Failure to comply with health and safety regulations and other practical procedures could endanger the health of such staff and contractors and could also expose the Group to claims for compensation and/or legal proceedings.

The Company has a Health Safety and Environment Policy which we adhere to. We have established a health and safety committee which meets quarterly and reports to the Board. The committee’s role is to ensure that we operate to high standards and comply with all required health and safety legislation; we have appointed external specialist advisers to assist in fulfilling this role and undertake to work only with competent contractors.

We operate mechanical and electrical equipment, often in isolated locations. We have developed a robust health and safety framework, engaging competent contractors and monitoring their performance.

14 Defaults by warranty providers

There is a risk that key manufacturers may go out of business and this could lead to a shortage in spare parts or a default on warranty cover.

We have established operational and emergency procedures to mitigate risks of this nature. In addition to considering alternative suppliers of parts, materials and services, in the event of insolvency of our major suppliers we have access to information which would allow others to replicate the services upon which we rely.

15 Public relations risk

There is a risk that the Group will experience opposition from some members of the public to the construction and operation of its renewable assets on the grounds of visual or noise disturbance. This is particularly relevant for wind farms which are

39

located on greenfield sites, where opposition from local residents can be strong. Such opposition may manifest itself in adverse publicity for the Group in the media, which has the risk of damaging the Group’s reputation.

The Group’s strategy is to acquire projects where planning consent has already been granted, which should ensure that legitimate opposition to construction of a particular renewable asset has already been considered and debated by the relevant local planning authority. However, the Group is committed to working with local communities in areas where it operates renewable assets and where issues or concerns are raised for any reason; the Group will always act responsibly by engaging and responding accordingly and in line with best industry practice.

16 Interest rates

An increase in interest rates could impact the surpluses generated by the Company and its ability to service the debt, or restrict its ability to raise bank debt in the future. To mitigate against this the majority of our debt is subject to fixed interest rates (79%). All the debt which is subject to variable interest rates is due for repayment by 2018.

17 Conflicts of interest

Triodos Bank manages the Company under the terms of a management services agreement. Amongst the Bank and its subsidiaries investment funds and mandates are managed with a similar investment strategy which could give rise to a conflict of interest. The Manager takes measures to mitigate conflicts of interest which may occur from the different roles and responsibilities it has towards the managed funds, the funds investors and the companies in which it invests by adhering to its Conflicts of Interest Policy.

40

Appendix 1: Definitions and terms

A share. An A ordinary share of £2 in the capital of the company

Act. The Companies Act 2006

AIM. The Alternative Investment Market of the London Stock Exchange plc

Capita Asset Services. Providers of the Matched Bargain Market to the Company

Capita Registrars Limited. Providers of a receiving agent function for the Share Issue

Chair. The Chair of the Board, currently Simon Roberts

Company. Triodos Renewables plc

Buy-back scheme. A scheme whereby the Company may buy back the shares of eligible shareholders on the occasion of each new share issue at a 10% discount to the share issue price. Only shares which have remained unsold on the Matched Bargain Market for at least 12 months are typically eligible

CFD. Contract for difference

Co-worker. A person who is employed by the Company or Triodos Bank NV

Development projects. Early stage projects that still require at least planning permission, a grid connection and finance in place before they can be built

Directors or the Board.The directors of the Company

Dutch Central Bank. De Nederlandsche Bank (DNB), the central bank and one of the banking regulatory authorities of The Netherlands

Edison. Edison Investment Research Limited – an analyst, research and valuation firm

EMR. Energy Market Reform

Ethex. A not for profit positive investment platform which provides a marketing and distribution function for both the share issue and the shares on an ongoing basis

Existing Shareholders. Shareholders of the Company whose names appear on the register of members of the Company at the date of this document

FCA. The Financial Conduct Authority

FIT. Feed-in tariff. A revenue support mechanism under which generators of renewable energy receive payments funded by the Government

FIT CFD. Feed-in tariff under the new CFD scheme

FSMA. The Financial Services and Markets Act 2000 (as amended)

the Fundraising. the offers for subscription by the Company comprising the Initial offer and the Second Offer as set out in this document

Group. The Company, its subsidiaries and subsidiary undertakings

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GW. Gigawatt, 1000 megawatts

GWh. The amount of electricity consumption (or generation) at a constant rate of 1 gigawatt per hour.

HMRC. HM Revenue & Customs (formerly the Inland Revenue)

Investors. Existing Shareholders and new subscribers under the Initial Offer and the Second Offer

Initial Offer. The conditional offer inviting Investors to subscribe for New Ordinary Shares at the Issue Price, on the terms and subject to the conditions set out in this document

Issue price. The share price of this issue, £2.28

Management Team. The executive management team which manages the Company on a day-to-day basis

Matched Bargain Market. A service marketed by Ethex and operated by Capita Asset Services on which Triodos Renewables shares are traded on a matched bargain basis

Maximum or Full Subscription. The aggregate maximum subscription between the Offers under the fundraising of £5,000,000 (unless increased at the discretion of the Directors)

Manager. Triodos Bank NV

Minimum Subscription. the aggregate minimum subscription between the Offers under the Fundraising of £1,000,000

MW. Megawatt, the unit for measuring energy output of a project

MWh. The amount of electricity consumption (or generation) at a constant rate of 1 Megawatt (MW) per hour. The average UK household consumes 4.170 MWh per year, according to DECC

New Ordinary Shares. Up to 2,192,982 shares of 50p each in the capital of the Company to be issued and allotted to investors under the Fundraising, with 1,726,839 New Ordinary Shares available under the Initial Offer and 466,143 New Ordinary Shares available under the Second Offer, unless extended at the discretion of the Directors

Offers. The Initial Offer and the Second Offer

O&M. Operating and maintenance (agreements)

Power. Power is the rate at which energy is used or produced. One Megawatt-hour represents 1 hour of electricity consumption (or generation) at a constant rate of 1 Megawatt (MW)

PPA. A power purchase agreement, the agreement between a supplier of electricity and a generator of electricity regarding the price that will be paid for the energy purchased

PRA. The Prudential Regulation Authority

Project Company. A company that owns and operates a single renewable generation project

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Renewable Energy. Energy generated from unlimited natural resources such as wind, solar, wave and tidal

Renewables Obligation. All suppliers of electricity in the UK are obliged by UK law to supply 10% of their electricity from renewable sources by 2010 and 15% by 2015. Those who fail to meet these targets have to pay a penalty and the money is paid to those suppliers who exceed the targets

Renewable Obligation Certificate or ROC. Generators of electricity under the Renewables Obligation receive certificates for all renewable electricity they produce. These certificates are usually sold to suppliers of electricity so the latter can meet the requirements of the Renewables Obligation

SDRT. Stamp duty reserve tax

Second Offer. The offer of up to 466,143 New Ordinary Shares to Existing Shareholders and new Investors willing to make a minimum subscription of £78,744.36, unless extended at the discretion of the Directors

Share Offer. Together the Initial Offer and the Second Offer

Shares or Ordinary Shares. Ordinary shares of 50p each in the capital of the Company

Shareholders. Holders of shares

Trillion Fund. A renewable energy crowd funding platform who are providing a marketing, distribution and receiving agent function for the Share Issue

Triodos Bank or the Bank. For the purpose of this Offer ‘Triodos Group’ means the economic and organisational unity, under central control, constituted by a primary group consisting of Triodos Bank N.V. and all legal entities in which Triodos Bank N.V. owns more than 50% of the economic rights, and a secondary group consisting of all legal entities in which the primary group has effective management control, as well as the Triodos Investment funds incorporated in the Netherlands, Luxembourg and the UK.

Triodos Renewables. Triodos Renewables plc

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Appendix 2: The Share Offers

The Fundraising is conditional upon the Minimum Subscription being raised. The aggregate Minimum Subscription under the Fundraising between the Offers is £1,000,000. The minimum individual subscription under the Initial Offer is 22 New Ordinary Shares and under the Second Offer is 34,537 New Ordinary Shares.

The Initial Offer is intended to raise up to £3,937,192.92 by the offer of up to 1,726,839 New Ordinary Shares to Investors. The Second Offer is intended to raise up to £1,062,806.04 by the offer of up to 466,143 New Ordinary Shares to Investors. The Directors will allocate New Ordinary Shares on a ‘first come, first served’ basis. The Directors will allocate applications for 34,537 or more New Ordinary Shares automatically to the Second Offer.

The Initial OfferSubject to the terms and conditions of application, the Company invites Investors to apply for New Ordinary Shares at a price of £2.28 per Share.

Investors may apply for New Ordinary Shares in quantities of 1, subject to a minimum individual subscription of 22 New Ordinary Shares. If there is an over subscription under the Initial Offer, in such circumstances, Investors will be allocated New Ordinary Shares on a ‘first come, first served’ basis. The Directors will proceed to allow New Ordinary Shares once the Minimum Subscription has been achieved between the Offers.

The Second OfferSubject to the terms and conditions of application, the Company invites Investors to apply for New Ordinary Shares at a price of £2.28 per share.

Potential Investors under the Second Offer may apply for any whole number of New Ordinary Shares subject to a minimum individual subscription of £78,744.36.

The Directors will proceed to allow New Ordinary Shares once the Minimum Subscription has been achieved between the Offers.

Offer CostsThe costs of the Fundraising, assuming Maximum Subscription of the Offers, are not expected to exceed £250,000 plus VAT.

Closing DateEach of the Initial Offer and the Second Offer will close on the earlier of full subscription of the relevant offer or 28 November 2014, unless extended by the Directors in their absolute discretion. The subscription monies will be kept in a separate bank account and, if the Minimum Subscription has not been achieved by 28 November 2014, the Offers will be withdrawn and the subscription monies refunded without interest within 14 business days of the Offers being withdrawn to the account where the monies were received from.

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Further informationFrom October 1st 2014, the Financial Conduct Authority in the UK is limiting who can buy shares, bonds and debentures that are not listed on a recognised stock exchange, or part of a fund. Before you can apply under these Offers, we need to ask you to declare what kind of investor you are, and check that you understand the nature of investment you are considering and the risks involved.

For further details on the investment opportunity please visit www.triodosrenewables.co.uk or contact Triodos at investments@triodos.co.uk or on 0117 980 9717.

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Appendix 3: General information

General information

1 Responsibility

The Directors (whose names appear on page 27) and the Company accept responsibility for the information in this document. To the best of the knowledge of the Company and the Directors (who have taken all reasonable care to ensure that such is the case), the information contained in this document is in accordance with the facts and does not omit anything likely to affect the impact of such information.

2 Incorporation and activity

The Company was incorporated in England and Wales under the Companies Act 1985 as a public limited company with the name The Wind Fund plc and registered number 2978651 on 10 October 1994. On 3 January 2003 the Company changed its name to Triodos Renewable Energy Fund plc. On 1 July 2009 the Company changed its name to Triodos Renewables plc. The principal legislation that applies to the Company is the Act. The liability of the Company’s members is limited.

The registered office and principal place of business of the Company is Triodos Bank, Deanery Road, Bristol, BS1 5AS. The Company uses its corporate name and a trading name ‘Triodos Renewables’. The Company is the ultimate parent company of the Group. Subsidiaries of the Company are listed at paragraph 6 below.

3 Share capital of the Company

Set out below are details of the authorised and issued share capital of the Company as at 30 June 2014 (the latest practicable date prior to the publication of this document) and the authorised and issued share capital of the Company as it will be immediately following the Fundraising, assuming Maximum Subscription of the Offers.

Authorised and issued share capital, now and after the Fundraising

Before the Offers

Immediately following

the Offers

Number of Ordinary Shares 20,018,864 22,211,846

Nominal value of Ordinary Shares £10,009,432 £11,105,923

Number of ‘A’ Ordinary Shares 1 1

Nominal value of ‘A’ Ordinary Shares £2 £2

4 Directors’ and other interests

The interests of the Directors and their immediate families (all of which are beneficial) in the issued share capital of the Company which:

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• have been notified to the Company; or

• so far as the Directors are aware having made due and proper enquiry of such persons connected with each Director;

• as they are as at 30 June 2014 (being the last practicable date prior to the publication of this document) and as they will be immediately following the Offer, assuming full subscription, are as follows:

Directors and their interests

Simon Roberts 514

Matthew Clayton 600

Ann Berresford NIL

Katie Gordon NIL

Peter Weston NIL

Colin Morgan NIL

Triodos Corporate Officer Ltd NIL

5 Service contracts and emoluments of the Directors

a) The following are particulars of the terms of appointment between the Company and the Directors and the Chair. With the exception of Matthew Clayton (who is an employee of Triodos Bank), all Directors are non-executive directors:

Save for in respect of Triodos Corporate Officer Limited and Matthew Clayton, the Company has entered into letters of appointment with each of the Directors, under which each director is appointed a Director of the Company with a Director’s fee of £9,000 per annum, with the exception of the Chair where the Director’s fee is £12,000 per annum. The appointment is terminable by the Company by not less than six months’ written notice and by each Director by not less than three months’

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written notice. Directors are not entitled to other emoluments, and are required to devote not less than nine days per year to the work of the Company, including Board meetings.

Except as disclosed above, or elsewhere in this document there are no other existing service contracts or letters of appointment between any of the Directors and the Company.

b) In addition to being Directors of the Company, the directorships and partnerships held by the Directors as at the date of this document and during the five years preceding the date of this document are as follows:

Current directorships/partnerships (other than subsidiaries of the Company):

Past directorships/partnerships:

Ann Berresford Bath Building Society; Hyperion Insurance Group; the Pensions Regulator

Pension Protection Fund

Matthew Clayton None None

Simon Roberts Bristol Energy Network CIC Regen SW

Peter Weston None None

Katie Gordon Durrell Wildlife Conservation Trust UK; XTRADOS

UK Sustainable Investment and Finance Association

Colin Morgan Garrad Hassan and Partners Ltd, Garrad Hassan Ireland Ltd

Garrad Hassan Denmark

Triodos Corporate Officer Limited

Triodos New Horizons Limited Paperback Collection and Recycling Limited; The Proper Welsh Milk Company Limited; Southern Solar Limited

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6 The Company and its subsidiaries

As at the date of this document, the Company is the parent company of the Group. A summary of the Group structure is as follows:

Group structure – an outline

Brunel Wind Group

Limited

Triodos Renewables

(HGL) Limited

Triodos Renewables plc

Triodos Renewables (Beochlich)

Limited

Triodos Renewables (Wern Ddu)

Limited

Triodos Renewables

(Boardinghouse)Limited

Triodos Renewables

(Bristol) Limited

Triodos Renewables (Auchtygills)

Limited

Triodos Renewables (Clayfords)

Limited

Triodos Renewables (Cambridge)

Limited

Triodos Renewables

(Dunfermline) Limited

Triodos Renewables

(Eye) Limited

Triodos Renewables(Haverigg II)

Limited

Triodos Renewables

(Kessingland) Limited

Triodos MelinsusLimited

Triodos Renewables(Fenpower)

Limited

Fenpower Limited

BoardinghouseWindfarm

Limited

Triodos Renewables

(March) Limited

Triodos Renewables

(Severn) Limited

Triodos Renewables (Caton Moor)

Limited

Triodos Renewables

(HEL) Limited

Triodos Renewables

(Sigurd) Limited

Triodos Renewables

(HL) Limited

Triodos Renewables (Ness Point)

Limited

Projects in DevelopmentHolding company

Operating company Dormant Company

7 Material contracts

A Sponsor Agreement dated 19 June 2014 between the Company (1) and Triodos Bank NV (2) in relation to the Fundraising. Under this agreement, Triodos has been appointed as agent of the Company to use its reasonable endeavors to procure subscribers for New Ordinary Shares under the Fundraising at the offer price of £2.28 per New Ordinary Share.

Triodos’ obligations under the Sponsor Agreement are conditional, inter alia, on the issue of New Ordinary Shares following achievement of the Minimum Subscription being reached by 3pm GMT on 28 November or such later time as the Directors may agree.

The Sponsor Agreement provides for the Company to pay Triodos Bank a commission of 2% of the aggregate gross proceeds of the Fundraising.

Under the terms of the Sponsor Agreement, inter alia, the Company gives certain indemnities and warranties in favour of Triodos Bank together with provisions to

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enable Triodos Bank to terminate the agreement in certain circumstances prior to the Minimum Subscription being reached and the issue of New Ordinary Shares, principally if there is a material breach of the agreement or of the warranties given under it or if a force majeure event arises.

8 Taxation

The comments set out below are based on the law existing at the date of this document and what is understood to be current HMRC practice.

The statements on taxation below are intended to be a general summary of certain tax consequences that may arise in relation to the Company and Shareholders. This is not a comprehensive summary of all technical aspects of the structure and is not intended to constitute legal or tax advice to investors. Prospective investors should familiarise themselves with, and where appropriate should consult their own professional advisers on, the overall tax consequences of investing in the Company. The statements relate to investors acquiring Ordinary Shares for investment purposes only, and not for the purposes of any trade. As is the case with any investment, there can be no guarantee that the tax position or proposed tax position prevailing at the time an investment in the Company is made will endure indefinitely. The tax consequences for each investor of investing in the Company may depend upon the investor’s own tax position and upon the relevant laws of any jurisdiction to which the investor is subject.

Taxation of dividends

Under current UK tax legislation, no tax will be withheld from any dividend paid by the Company.

A UK resident individual shareholder is currently entitled to a tax credit equal to one-ninth of the cash dividend received. Such a shareholder will be subject to UK income tax on the aggregate of the dividend received and the related tax credit. This will be included in calculating the shareholder’s total income for UK tax purposes and will be taxed at a rate of 10% in the case of a lower rate or a basic rate taxpayer or, in the case of a higher rate taxpayer, 32.5% or, in the case of an additional rate taxpayer, 42.5% of the cash dividend received. The aggregate of the dividend and the tax credit will be treated for UK income tax purposes as the top slice of the shareholder’s income. The tax credit is set against the shareholder’s overall UK income tax liability. Consequently, a lower or basic rate taxpayer will have no further liability to UK income tax on the dividend, and a higher rate taxpayer and an additional rate taxpayer will have a further liability to UK income tax of 22.5% and 27.5% respectively of the aggregate of the dividend received and the related tax credit (which equates to 25% and 30.56% of the net dividend received, respectively). Individual shareholders will not be able to reclaim any part of the tax credit from the HMRC subject to limited exceptions for ‘Individual Savings Accounts’ and ‘Personal Equity Plans’.

A UK resident corporate shareholder will not normally be subject to corporation tax on the dividend received where it is classified by HMRC as a ‘small company’. Other companies will be liable for corporation tax on dividends received unless they qualify for an exemption. There are a number of useful exemptions available to corporate shareholders, including in respect of portfolio shareholdings. However, prospective investors should seek specialist tax advice before relying on an exemption as anti-avoidance provisions may apply in certain circumstances.

A shareholder not resident in the UK for tax purposes is not generally entitled to a tax credit in respect of a dividend received. However, such a shareholder may be entitled to a payment from HMRC of a proportion of the tax credit under a double tax convention or agreement between the UK and the country in which they are resident. A shareholder not resident in the UK for tax purposes may be subject to foreign tax on the dividend received. Such a shareholder should consult their own tax adviser on the incidence of the tax in the country in which they are resident for tax purposes,

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as to whether they are entitled to the benefit of any tax credit and the procedure for claiming payment.

Stamp duty and stamp duty reserve tax

No stamp duty or stamp duty reserve tax (SDRT) will be payable on the issue of Ordinary Shares save that special rules apply to persons operating clearance services or depository receipt services.

A transfer or sale of Ordinary Shares will generally be subject to ad valorem stamp duty at the rate of 0.5% rounded up to the nearest multiple of £5 on the amount or value of the consideration paid by the purchaser where the consideration paid is equal to or in excess of £1,000. If an unconditional agreement for the transfer of such Ordinary Shares is not completed by a duly stamped transfer to the purchaser by the seventh day of the month following the month in which the agreement becomes unconditional, SDRT will be payable on the agreement at the rate of 0.5% of the amount or value of consideration paid. Liability to SDRT is generally that of the purchaser. Where a purchaser or transfer is effected through a member of the London Stock Exchange or a qualified dealer, the said member or dealer will normally account for the SDRT.

When Ordinary Shares are transferred to a CREST member who holds those Ordinary Shares in uncertificated form as a nominee for the transferor, no stamp duty or SDRT will generally be payable.

When Ordinary Shares are transferred by a CREST member to the beneficial owner (on whose behalf it has held them as nominee), no stamp duty or SDRT will generally be payable.

Where a change in beneficial ownership of Ordinary Shares held in uncertificated form occurs and such change is for consideration in money or money’s worth (whether the transferee will hold those Ordinary Shares in certificated or uncertificated form), a liability to SDRT at the rate of 0.5% of the amount or value of the consideration will arise. This will generally be met by the new beneficial owner.

Taxation of capital gains

UK resident Shareholders who are individuals (or otherwise not within the charge to UK corporation tax) and who are basic rate taxpayers are currently subject to tax on their chargeable gains at a flat rate of 18 per cent. Individuals who are higher or additional rate taxpayers are currently subject to tax on their chargeable gains at a flat rate of 28 per cent. No indexation allowance will be available to such Shareholders but they may be entitled to an annual exemption from capital gains (this is £11,000 for the tax year 2014/2015).

Shareholders who are individuals and who are temporarily non-resident in the UK may, under antiavoidance legislation, still be liable to UK tax on any capital gain realised (subject to any available exemption or relief).

Shareholders within the charge to UK corporation tax may be subject to corporation tax on chargeable gains in respect of any gain arising on a disposal of Ordinary Shares. Indexation allowance may apply to reduce any chargeable gain arising on disposal of the Ordinary Shares but will not create or increase an allowable loss.

Inheritance tax business property relief

Where Ordinary Shares are held in an unquoted qualifying company for at least two years, subject to certain conditions, the Ordinary Shares may qualify for Business Property Relief at 100%, thus reducing the inheritance tax liability on the transfer to nil.

Any person who is in any doubt as to his tax position or is subject to taxation in a jurisdiction other than the UK should consult an appropriate professional adviser.