Hi Thomas
Did you agree with the SEO people a list of KW to rank on?. I just ran a simple search with some kw on google.co.uk and the rankings I found were
aluminium school signs 5
safety signs 50+
school sign company 7
school signs 50+
school signs in aluminium 5
we love school designs 50+
So you are at least on first page for some of the KW in your title tags and that describe your business. This is not what you expect to see if your website drops to the 10th page of Google's results.
Try downloading a program called "free google monitor" from cleverstat, Use it to find your ranking for the KW that are important for you. You probably still rank well enough on them.
In my opinion the SEO company is giving you a vague list of what they will do. The activities they list are not wrong, but since they lack detail I would not be comfortable with giving my business to them. I think they are not being straightforward with you on what happened, why it did and what is it exactly that they will do about it.
You should probably get a quote from some other (quality) SEO companies.
Cheers
Jorge