Costain : Costain 2023 Long Term Incentive Plan Rules

Rules of the Costain 2023 Long Term Incentive Plan

Adopted by the board of directors on 8 March 2023

Approved by shareholders on [11 May 2023]

Expiry date [11 May 2033]

Table of Contents
1.	Definitions and Interpretation	2
2.	Grant of Awards	5
3.	Performance Condition	6
4.	Restrictions on Transfer and Bankruptcy	6
5.	Dividend Equivalents	6
6.	Individual Limit	6
7.	Plan Limit	7
8.	Reduction and Recovery	8
9.	Vesting, Release, Exercise and Settlement	9
10.	Relevant Liabilities and Regulatory Issues	11
11.	Cash Equivalent	11
12.	Cessation of Employment	12
13.	Corporate events	15
14.	Adjustments	17
15.	Amendments	17
16.	Legal Entitlement	18
17.	General	19

1

The Costain 2023 Long Term Incentive Plan

1. Definitions and Interpretation

1.1 In this Plan, unless otherwise stated, the words and expressions below have the following meanings:

"Award" means a Conditional Award or a Nil-Cost Option;

"Board" means, subject to rule 13.8, the board of the Company or any committee or person duly authorised by the board, or any duly appointed successor body;

"Company" means Costain Group PLC registered in England and Wales under number 01393773;

"Conditional Award" means a right to receive Shares automatically at no cost subject to the rules of the Plan;

"Control" has the meaning given by section 995 of the Income Tax Act 2007;

"Dealing Day" means any day on which the London Stock Exchange is open for business;

"Dealing Restrictions" means restrictions imposed by the Company's share dealing code, the Listing Rules, the MAR or any other laws or regulations that impose restrictions on share dealing;

"Eligible Employee" means an employee (including an executive director) of the Company or any of its Subsidiaries;

"FCA" means the United Kingdom Financial Conduct Authority, or any successor body; "Grant Date" means the date on which an Award is granted;

"Grant Period" means the period of 42 days beginning on:

1. the day on which the Plan is approved by shareholders in general meeting;
2. the first Dealing Day after the day on which the Company makes an announcement of its results for any period;
3. the day on which the Policy is approved by shareholders; or
4. any day on which the Board resolves that exceptional circumstances exist which justify the grant of Awards,

unless the Company is restricted from granting Awards during the periods specified above as a result of any Dealing Restrictions, in which case the relevant Grant Period will be 42 days beginning on the day after such Dealing Restrictions are lifted;

"Group Member" means the Company, any Subsidiary of the Company, any company that is (within the meaning given by section 1159 of the Companies Act 2006) the Company's holding company or a Subsidiary of the Company's holding company or, if the Board so determines,

any body corporate in relation to which the Company is able to exercise at least 20% of the equity voting rights and "Group" will be construed accordingly;

"Holding Period" means a period of two years (or such other period as the Board may determine on or before the Grant Date), beginning on the Vesting Date;

"Internal Reorganisation" means where immediately after a change of Control of the Company, all or substantially all of the share capital of the acquiring company is owned directly or indirectly by the persons who were shareholders in the Company immediately before the change of Control;

"Listing Rules" means the FCA's listing rules, as amended from time to time;

"MAR" means the EU Market Abuse Regulation 596/2014 and any associated EU Regulation, to the extent each is incorporated into the law of the United Kingdom by virtue of section 3 of the European Union (Withdrawal) Act 2018 and as amended by any instrument related to their incorporation into the law of the United Kingdom;

"Nil-CostOption" means a right to acquire Shares subject to the rules of the Plan for nil cost or for a Nominal Exercise Price;

"Nominal Exercise Price" means an exercise price per Share equal to the nominal value of a Share from time to time;

"Normal Release Date" means the date on which an Award will normally be Released, which:

1. in relation to an Award to which no Holding Period applies, will be the Vesting Date; and
2. in relation to an Award to which a Holding Period applies, will be the first Dealing Day immediately after the end of the Holding Period;

"Participant" means any person who holds an Award or following their death, their personal representatives;

"Performance Condition" means any one or more condition, measure, target (whether on an individual basis or otherwise) or conditions imposed under rule 3.1 that relates to performance;

"Performance Period" means the period over which a Performance Condition will be measured which, unless the Board determines otherwise, will be at least three years;

"Plan" means the Costain 2023 Long Term Incentive Plan as amended from time to time;

"Policy" means the Company's directors' remuneration policy that has most recently been approved by the Company's shareholders;

"Recovery Period" means subject to rule 8.6, the period beginning on the first day of the Vesting Period/Financial Year to which the Award relates and ending on the second anniversary of the Vesting Date, or such other period determined by the Board on or before the Grant Date;

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"Recruitment Award" means an Award granted in connection with the recruitment of an Eligible Employee and which is granted in respect of remuneration they forfeit in connection with their joining the Group;

"Release" means:

1. in relation to a Conditional Award, the point at which the Participant becomes entitled to receive the Shares under their Award; and
2. in relation to a Nil-Cost Option, the point at which it becomes capable of exercise, and "Released" and "Unreleased" will be construed accordingly;

"Release Date" means the date on which an Award is Released;

"Relevant Liability" means any tax, social security contributions, levy, charge or other payroll deductions required by law arising out of or in connection with an Award for which the Participant is liable (or which may be recovered from the Participant) and for which any Group Member or former Group Member is obliged to pay or account to any relevant authority, or any reasonable estimate thereof;

"Share" means a fully paid ordinary share in the Company;

"Shareholding Requirement" means any requirement, guideline or policy determined by the Board from time to time pursuant to which a person must hold Shares either during their office or employment with a Group Member or following their ceasing to hold office or employment with a Group Member;

"Subsidiary" has the meaning given by section 1159 of the Companies Act 2006;

"Trustee" the trustee or trustees for the time being of any employee benefit trust, the beneficiaries of which include Eligible Employees;

"Vest" means the Board's determination of the number of Shares in respect of which an Award may become capable of Release by reference to the satisfaction of any Performance Condition, any adjustment in accordance with rule 9.2 and any other term of the Award;

"Vesting Date" means the date on which an Award will normally Vest, which will be the later of:

1. the date on which the Board determines the extent to which any Performance Condition has been satisfied in accordance with rule 9.1; and
2. the date on which the Board determines whether an adjustment should be made in accordance with rule 9.2;

or any date set by the Board on or before the Grant Date;

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