Director Dealings and New Option Scheme

22 December 2014

OPSEC SECURITY GROUP PLC

("OpSec" or the "Company")

Director Dealings and New Option Scheme

The Company announces that, on 19 December 2014, it adopted a new management incentive scheme, the OpSec Executive Share Option Scheme 2014 ("ESOS"). The maximum number of ordinary shares of 5 pence in the Company ("Shares") over which options may be granted under the ESOS shall not, when aggregated with any Shares that either have been or may be issued or transferred to satisfy any rights that, at the date of adoption of this scheme, are outstanding under any other schemes, exceed 13,188,632 Shares. In determining whether this limit would be exceeded, there shall be disregarded:-

· any Shares over which options have been granted under the ESOS if, and to the extent that, such options have lapsed; and

· any Shares that either might have been issued or transferred to satisfy any rights under any other employee share schemes established by the Company if, and to the extent that, such rights have lapsed.

Under the ESOS, on 19 December 2014, the Company granted options over, in aggregate, 11,915,000 Shares ("Options") to management and Directors whereby they are entitled to acquire Shares at 38 pence per share. Awards to the Directors included in that total are set out in the table below.

The Options will vest, as to one-half of the Shares under option, on a time basis (the "Time-Based Option") and, as to the other one-half of the Shares under option, if and to the extent that certain targets relating to the Company's EBITDA are met (the "Performance-Based Option"). 

The Time-Based Option will vest as follows:-

· on the date of grant, as to eight forty-eighth (8/48) of the Shares;

· on 31 December 2014 and the last day of each subsequent month until 28 February 2018, one forty- eighth (1/48) of those Shares; and

· on 31 March 2018, the balance.

The Performance-Based Option will vest as follows:-

· one-third of those Shares will vest if the Company's EBITDA for the financial period ending 31 March 2016 is not less than $11 million, the Company's EBITDA for the financial period ending 31 March 2017 is not less than $15 million or the Company's EBITDA for the financial period ending 31 March 2018 is not less than $19 million;

· a further one-third of those Shares will vest if the Company's EBITDA for the financial period ending 31 March 2017 is not less than $15 million or the Company's EBITDA for the financial period ending 31 March 2018 is not less than $19 million; and

· the final one-third of those Shares will vest if the Company's EBITDA for the financial period ending 31 March 2018 is not less than $19 million.

The Company's EBITDA for any period is defined as the earnings (computed in accordance with prevailing accounting principles) for that period before interest, tax, depreciation and amortisation of the Company and its subsidiaries (adjusted so as to disregard the effects of charges or credits for share-based payments and exceptional items and impairment charges).

If there is a qualifying change of control of the Company and the price per Share payable in connection with the qualifying change of control is not less than 60 pence, the Time-based Options and the Performance-based Options will (to the extent that they have not already vested) vest as follows:-

· if the price offered is between 60 pence and (less than) 65 pence, the participant can acquire 20% of the Shares that he would otherwise be unable to acquire;

· if the price offered is between 65 pence and (less than) 70 pence, the participant can acquire 50% of those Shares;

· if the price offered is between 70 pence and (less than) 75 pence, the participant can acquire 75% of those Shares; and

· if the price offered is 75 pence or more, the participant can acquire all the shares the subject of the Options.

A qualifying change of control of the Company means:-

· a change of control of OpSec resulting from a formal offer made by a third party for its entire issued share capital;

· a person (or persons) acquiring control of OpSec (other than as a result of a formal offer) unless than person is Investcorp or its affiliates (in which case, this will be a qualifying change of control only if this is agreed with two or more participants holding more than 50% of the shares under option under the Scheme); and

· any other circumstances that are agreed by the OpSec board (acting reasonably).

The Options can be exercised at any time after (in the case of the Time-based Option) 1 April 2018 or, (in the case of the Performance-based Options) they have vested until the earlier of 30 September 2024, three months after a cessation of employment and seven days following a qualifying change of control of the Company.

A condition for participation in the ESOS is the surrender of all outstanding awards under the other employee share schemes established by the Company. Accordingly, the Directors are surrendering the awards under the scheme set out in the table below granted to them over the number of Shares set out in the table:-

- Ends -

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