Costain : Costain 2023 Share Deferral Plan Rules

Rules of the Costain 2023 Share Deferral 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	1
2.	Grant of Awards	3
3.	Restrictions on Transfer and Bankruptcy	4
4.	Dividend Equivalents	4
5.	Plan Limit	4
6.	Reduction and Recovery	5
7.	Vesting, Exercise and Settlement	6
8.	Relevant Liabilities and Regulatory Issues	8
9.	Cash Equivalent	8
10.	Cessation of Employment	8
11.	Corporate Events	10
12.	Adjustments	12
13.	Amendments	12
14.	Legal Entitlement	13
15.	General	13
Schedule 1 - Cash Awards	15

The Costain 2023 Share Deferral 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 11.7, the board of the Company or any committee or person duly authorised by the board, or any duly appointed successor body;

"Bonus" means the bonus (if any) earned by an Eligible Employee pursuant to an annual bonus plan operated by any Group Member;

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

"Conditional Award" means a right to receive Shares automatically 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 which impose restrictions on share dealing;

"Deferred Bonus" means the amount of Bonus which is to be delivered in the form of an Award, which, in respect of an Award made to an executive director of the Company, will be determined in accordance with the relevant Directors' Remuneration Policy;

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

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

"Grant Period" 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 first Dealing Day following the date on which any Bonus is determined;
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;

"Internal Reorganisation" means where immediately after a change of Control of the Company, all or substantially all of the issued 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;

"Normal Vesting Date" means the date on which an Award will normally Vest, which, unless the Board determines otherwise, will be the second anniversary of the Grant Date;

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

"Plan" means the Costain 2023 Share Deferral Plan as amended from time to time;

"Recovery Period" means, subject to rule 6.6, the period ending on the Normal Vesting Date or, if later, the second anniversary of the Grant Date;

"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;

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

"Vest" means:

1. 1. in relation to a Conditional Award, the point at which the Participant becomes entitled to receive the Shares comprised in their Award; and
   2. in relation to a Nil-Cost Option, the point at which it becomes capable of exercise, and "Vesting", "Vested" and "Vesting Date" will be construed accordingly.
2. References in the Plan to:
3. 1. any statutory provisions or to regulations are to those provisions or regulations as amended or re-enacted from time to time;
   2. the singular include the plural and vice versa; and
   3. the masculine include the feminine and vice versa.
4. Headings do not form part of the Plan.

2. Grant of Awards

1. The Board may, during a Grant Period, grant an Award to an Eligible Employee.
2. An Award may be subject to such additional terms as the Board may determine.
3. An Award may be divided into distinct tranches with different Normal Vesting Dates, and, if so, the rules of the Plan will be construed as if each tranche were itself a separate Award.
4. The grant of an Award will be subject to obtaining any approval or consent required by the FCA (or other relevant authority), any Dealing Restrictions and any other applicable laws or regulations (whether in the UK or overseas).
5. An Award may only be granted to an Eligible Employee who has earned a Bonus for the Financial Year immediately preceding the Financial Year in which the Grant Date occurs.
6. An Award will be granted over such number of Shares as have at the Grant Date a market value (as determined by the Board) equal to the Deferred Bonus and to the extent that the value of any Award as at the Grant Date exceeds that of the Deferred Bonus it will be scaled back accordingly.
7. Awards must be granted by deed (or in such other written form as the Board determines) and as soon as reasonably practicable after the Grant Date, Participants must be notified of the terms of their Award including the Normal Vesting Date and any additional terms imposed by the Board in accordance with rule 2.2.
8. A Participant may be required to accept an Award in such form as the Board reasonably requires and, if the Board has not received (or waived the right to require) such acceptance on or before the date that is three months after the Grant Date:

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