Rules of the Dunelm Group
2014 Long Term Incentive Plan
Approved by the shareholders of Dunelm Group plc on 11 November 2014
Adopted by the board of directors of Dunelm Group plc on 11
November 2014
As amended by the board of Directors of Dunelm Group plc on 24
November 2015 following approval by the shareholders of Dunelm
Group plc on 24 November 2015
As amended by the board of Directors of Dunelm Group plc on 21
November 2017 following approval by the shareholders of Dunelm
Group plc on 21 November 2017
As amended by the board of Directors of Dunelm Group plc on 17 November 2020, and applying to awards granted on or after that date.
As amended by the board of directors of Dunelm Group plc on 6
September 2023 subject to the approval of the shareholders of the
Dunelm Group plc
Expiry date: 11 November16 November 2033
Contents
9 | VESTING AND EXERCISE | 998 | ||
10 | TAXATION AND REGULATORY ISSUES AND SHAREHOLDING REQUIREMENTS9 | |||
11 | CASH EQUIVALENT | 10 | ||
12 | CESSATION OF EMPLOYMENT | 10 | ||
13 | CORPORATE EVENTS | 12 | ||
14 | ADJUSTMENTS | 15 | ||
15 | AMENDMENTS | 15 | ||
16 | LEGAL ENTITLEMENT | 16 | ||
17 | GENERAL | 16 | ||
SCHEDULE | 1 | |||
1 | CASH AWARDS | 1 |
Dunelm (SoftDunelmFurnishings)(Soft Furnishings)Ltd - HIGHLYLtdCONFIDENTIAL
THE DUNELM GROUP 2014 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:
"Assessment Date" | in relation to an Award, the later of: | |||||||||||
(a) | the date on which the Board determines the extent to which | |||||||||||
any Performance Condition has been met; and | ||||||||||||
(b) | the date on which the Board determines whether an | |||||||||||
adjustment should be made in accordance with rule 9.2; | ||||||||||||
"Award" | a Conditional Award or an Option; | |||||||||||
"Board" | subject to rule 13.9, the board of the Company or any committee or | |||||||||||
personduly authorised committee ofbythe board, or any duly | ||||||||||||
authorised successor body; | ||||||||||||
"Company" | Dunelm Group plc registered in England and Wales under number | |||||||||||
04708277; | ||||||||||||
"Conditional Award" | a right to acquirereceiveShares automatically at no cost in | |||||||||||
accordance with the rules of the Plan | with no Exercise Period | ; | ||||||||||
"Control" | the meaning given by section 995 of the Income Tax Act 2007; | |||||||||||
"Dealing Day" | any day on which the London Stock Exchange is open for business; | |||||||||||
"Dealing Restrictions" | restrictions imposed by the MAR, theCompany's share dealing | |||||||||||
codepolicy, the Listing Rules or any applicable laws or regulations | ||||||||||||
which impose restrictions on share dealing; | ||||||||||||
"Eligible Employee" | an employee (including an executive director) of the Company or any | |||||||||||
of its Subsidiaries; | ||||||||||||
"Exercise PeriodFCA" | the period during which an Option may be exercised;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 commencing on: | |||||||||||
(a) | the day on which the extension of the life of the Plan is | |||||||||||
approved by shareholders of the Company in general | ||||||||||||
meeting; | ||||||||||||
(b) | the Dealing Day after the day on which the Company makes | |||||||||||
an announcement of its results for any period;(including any | ||||||||||||
quarterly trading update); | ||||||||||||
(c) | ||||||||||||
(c) | the day on which the Policy is approved by shareholders; |
Dunelm (SoftDunelmFurnishings)(Soft Furnishings)Ltd - HIGHLYLtdCONFIDENTIAL
(d) | in respect of an Eligible Employee, the date on which that | ||
Eligible Employee first becomes employed by the Company | |||
or any of its Subsidiaries; or | |||
(e) | 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 under the Plan | |||
during the periods specified above as a result of any Dealing | |||
Restrictions, in which case the relevant Grant Period will be 42 days | |||
commencing on the Dealing Day after such Dealing Restrictions are | |||
lifted; | |||
"Group Member" | the Company, any Subsidiary of the Company, any company which is | ||
(within the meaning of 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" | in respect of an Award which is subject to a Holding Period, the period | ||
starting on the later of theAssessment Date and the third anniversary | |||
of the Grant Date(or such later date as the Board determines)and | |||
ending two years later;(or at such other time as the Board may | |||
determine on or before the Grant Date);1 | |||
"Internal Reorganisation" | 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" | the UKLA'sFCA'slisting rules, as amended from time to time; | ||
"MAR" | 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-Cost Option" | a right to acquire Shares in accordance with the terms of the Plan | ||
during an Exercise Periodat no cost to the Participant; | |||
"Nominal Value Option" | a right to acquire Shares in accordance with the terms of the Plan | ||
during an Exercise Periodon payment of an exercise price equal to | |||
the nominal value of the Shares; |
Dunelm (SoftDunelmFurnishings)(Soft Furnishings)Ltd - HIGHLYLtdCONFIDENTIAL
"Normal Vesting Date"2 | the date on which an Award will normally Vest, which will be | |
determined as set out below: | ||
in respectAwards which are subject to a Performance Condition and | ||
to a Holding Period | ||
The Normal Vesting Dateof an Award which is subject to a | ||
Performance Condition and to a Holding Period,will be the first | ||
Dealing Day after the end of the Holding Period. | ||
Awards which are subject to a Performance Condition but not subject | ||
to a Holding Period | ||
The Normal Vesting Date of an Award which is subject to a | ||
Performance Condition but not subject to a Holding Periodwill be the | ||
later of: | ||
(a)the Assessment Date; and |
(b) the third anniversary of the Grant Date, | |||||
or such other date determined by the Board at the Grant Date. | |||||
Recruitment Awards which are not subject to a Performance | |||||
Condition | |||||
The Normal Vesting Date of a Recruitment Award which is not subject | |||||
to a Performance Condition will be the later of: | |||||
(a) | the date specified for these purposes by the Board at the Grant | ||||
Date; and | |||||
the date on which the Board determines whether an adjustment | |||||
should be made in accordance with rule 9.2; | and | ||||
the end of the Holding Period, | |||||
(or such later date determined by the Board at the Grant Date); and | |||||
i) in respect of an Award which is subject to a Performance | |||||
Condition but not subject to a Holding Period, will be the later of: | |||||
(a) | the Assessment Date; | ||||
(b) | the date on which the Board determines whether an adjustment | ||||
should be made in accordance with rule 9.2; | |||||
(c) | the third anniversary of the Grant Date, | ||||
(a) | (or such later date determined by the Board at the Grant Date); | ||||
(b) | |||||
"Option" | a Nil-Cost Option or a Nominal Value Option; | ||||
Dunelm (SoftDunelmFurnishings)(Soft Furnishings)Ltd - HIGHLYLtdCONFIDENTIAL
"Participant" | any person who holds an Award or following histheirdeath, histheir | |
personal representatives; | ||
"Performance Condition" | a condition or conditions imposed under rule 3.1 which relates to | |
performance; | ||
"Performance Period" | the period over which a Performance Condition will be measured | |
which, unless the Board determines otherwise, will be at leastthree | ||
years; | ||
"Plan" | the Dunelm Group 2014 Long Term Incentive Plan in its present form | |
or as from time to time amended; | ||
"Policy" | the Company's directors' remuneration policy that has most recently | |
been approved by the Company's shareholders; | ||
"Recovery Period" | (a) | in the case of an Award subject to a Performance Condition, |
the period ending on the third anniversary of the Assessment | ||
Date (or such later date as the Board may choose if that | ||
determination is made before the originally anticipated end of | ||
the Performance Period); and | ||
(b) | in the case of a Recruitment Award which is not subject to a | |
Performance Condition, the period ending on the third | ||
anniversary of the Normal Vesting Date (or such other date | ||
as the Board may choose on or before the Grant Date); | ||
"Recruitment Award"3 | 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; | ||
"Share" | a fully paid ordinary share in the capital of 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 | ||
while they hold office or employment with a Group Member of | ||
following their ceasing to hold office or employment with a Group | ||
Member; | ||
"Subsidiary" | the meaning given by section 1159 of the Companies Act 2006; | |
"Tax Liability" | any tax or social security contributions liability or other deductions | |
required by law arising out of orin 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 oraccount to any relevant authority; | ||
"Trustee" | the trustee or trustees for the time being of any employee benefit trust, | |
the beneficiaries of which include Eligible Employees; | ||
"UKLA" | the United Kingdom Listing Authority (or other relevant authority); |
Dunelm (SoftDunelmFurnishings)(Soft Furnishings)Ltd - HIGHLYLtdCONFIDENTIAL
"Vest" | (a) | in relation to a Conditional Award, the point at which a |
Participant becomes entitled to receive the Shares; and | ||
(b) | in relation to an Option, the point at which it becomes | |
capable of exercise, |
and "Vesting" and "Vested" will be construed accordingly.
- References in the Plan to:
- any statutory provisions are to those provisions as amended or re-enacted from time to time;
- the singular include the plural and vice versa; and
- the masculine include the feminine and vice versa.
- Headings do not form part of the Plan.
2 GRANT OF AWARDS
- Subject to rule 2.2, during a Grant Period, the Board may grant an Award to an Eligible Employee in its discretion subject to the rules of the Plan and upon such additional terms as the Board may determine.
- The grant of an Award will be subject to obtaining any approval or consent required by the UKLAFCA(or other relevant authority), any Dealing Restrictions and any other applicable laws or regulations (whether in the UK or overseas).
- Awards must be granted by deed and as soon as practicable after the Grant Date,Participants must be notified of the terms of their Award including theanyPerformance Condition, and if the Award is subject to a Holding Period that this is the case.
- 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 receive) such acceptance on or before the date that is three months after the Grant Date:
- the Award may not Vest; and
- the Board may determine that the Award will lapse.
2.42.5No Award may be granted under the Plan after 16 November 2033 beingthe tenth anniversary of the date on which the extension of the life of the Plan was approved by the shareholders of the Company.
2.52.6The Board may make the Vesting (or, where relevant, the exercise) of an Award conditional upon the Participant having entered into:
2.5.12.6.1an agreement or election pursuant to paragraphs 3A or 3B of Schedule 1 to the Social Security Contributions and Benefits Act 1992 (as the Board determines); and/or
2.5.22.6.2an election under section 431 of the Income Tax (Earnings and Pensions) Act 2003.
3 PERFORMANCE CONDITION
3.1 TheSubject to rule3.4, theVesting of Awards will be subject to the satisfaction of a Performance Condition. Subject to rules 12 and 13, the Performance Condition will be measured over the Performance Period.
Dunelm (SoftDunelmFurnishings)(Soft Furnishings)Ltd - HIGHLYLtdCONFIDENTIAL
3.2 The Board may amend or substitute a Performance Condition if onein accordance with its termsor more events occur which causeifthe Board to considerconsidersthat a substituted or amended Performance Condition would be moreis reasonable,appropriate and would not be materially less difficult to satisfy than the original Performance Condition would have been but for the occurrence of the eventwhen it was originally set.
3.3
3.4
- If the extent to which the Performance Condition is satisfied is determined before the end of the Performance Period, the Board will take into account such factors as it considers are relevant.
- The Vesting of a Recruitment Award may be subject to the satisfaction of a Performance Condition, but does not have to be.
- RESTRICTIONS ON TRANSFER AND BANKRUPTCY
- An Award must not be transferred, assigned, charged or otherwise disposed of in any way (except in the event of the Participant's death, to histheirpersonal representatives) and will lapse immediately on any attempt to do so.
- An Award will lapse immediately if the Participant is declared bankrupt.
- The Board may grant an Award subject to such provisions as the Board may determine as to the retention of Shares by the Participant following the Vesting of the Award. In the case of an Award which is not subject to a Holding Period, any such provision may include, but is not limited to, a requirement that Shares acquired pursuant to an Award, other than any sold to realise an amount equal to any Tax Liability, must be retained until such date as the Board determines would have been the end of any Holding Period that would otherwise have applied and that any such Shares may be forfeited in the event of the Participant's summary dismissal before that date.
- DIVIDEND EQUIVALENTS
- The Board may decide at any time prior to the issue or transfer of Shares to which an Award relates that a Participant will receive an amount (in cash and/or Shares, and which may be calculated assuming the reinvestment of dividends) equal in value to some or all of the dividends (including special dividends, unless the Board determines otherwise) that would have been paid on Shares in respect of which the Award Vests from:over such period (ending no later than the date on which the Award Vests) as the Board may determine.
- the end of the Performance Period until the date of Vesting; or
- the start of the Performance Period (if the Board so determines) until the date of Vesting.
- INDIVIDUAL LIMIT
- Subject to rule 6.2, no Eligible Employee may be granted Awards in respect of the Company's 2017- 2018 financial year over more than 110,000 Shares.
- The limit in rule 6.1 on the number of Shares over which an Eligible Employee may be granted Awards in respect of any financial year of the Company may be adjusted in such manner as the Board determines in the event of any variation of the Company's share capital.
Dunelm (SoftDunelmFurnishings)(Soft Furnishings)Ltd - HIGHLYLtdCONFIDENTIAL
6.36.1No Eligible Employee may be granted Awardsan Award (other than a Recruitment Award)which would, at the time they areit isgranted, cause the market value (as determined by the Board)4of all the Shares subject to Awards (other than Recruitment Awards)granted to that Eligible Employee in respect of a particular financial year of the Company other than its 2017-2018financial yearto exceed 200250% of histheirannual salary and to the extent any award exceeds this limit it will be scaled back accordingly and treated as never having been granted to the extent it is so scaled back.
7 PLAN LIMITS
- The Board must not grant an Award which would, on the day before the Grant Date,cause the number of Shares allocated under the Plan and under any other employee share plan adopted by the Company to exceed such number as represents ten per cent of the ordinary share capital of the Company in issue at that time.
- The Board must not grant an Award which would, on the day before the Grant Date,cause the number of Shares allocated under the Plan and under any other discretionary employee share plan adopted by the Company to exceed such number as represents five per cent of the ordinary share capital of the Company in issue at that time.
- Subject to rules 7.4 and 7.5, in determining the limits set out in rules 7.1 and 7.2 Shares are treated as allocated if they have been newly issued by the Company or transferred from treasury to satisfy an option, award or other right granted during the previous ten years (an "award"), or in the case of such an award in respect of which Shares are yet to be delivered, if the Board intends that new Shares will be issued or that Shares from treasury will be transferred and for these purposes the number of Shares allocated includes:
- Shares which have been issued or may be issued to any Trustee; and
- Shares which have been or may be transferred from treasury to any Trustee
in either case for the Trustee to then transfer to satisfy an award (unless these Shares have already been counted under this rule).
- The Board may determine that Shares transferred from treasury will cease to count as allocated for the purposes of rule 7.3 if guidelines published by institutional investor representative bodies no longer require such Shares to be counted.
- The number of Shares allocated does not include:
- Shares issued or committed to be issued to satisfy awards granted prior to the admission of the Shares to the Official List of the London Stock Exchange;
- Shares in respect of which the rightthat were allocatedto acquiresatisfy awards to the extent thatsuch Shares lapsesawards have lapsed, been relinquishedor is releasedbeen satisfied in cash; and
- existing Shares other than treasury Shares which arethat have beentransferred to satisfy awardsor to which an award relatesthat have been allocated to satisfy awards.
- If the Board purports to grant one or more Awards which are inconsistent with the limits in this rule 7:
- if only one Award is purported to be so granted, that Award will be limited and will take effect from the Grant Date over the maximum number of Shares permitted by those limits; and
Dunelm (SoftDunelmFurnishings)(Soft Furnishings)Ltd - HIGHLYLtdCONFIDENTIAL
7.6.2 if more than one Award is purported to be so granted, each such Award will be reduced as determined by the Board and will take effect from the Grant Date over the maximum number of Shares permitted by those limits.
7.7 The Board may make such adjustments to the method of assessing the limits set out in rules 7.1 and 7.2 as it considers appropriate in the event of any variation of the Company's share capital.
8 REDUCTION FOR MALUS AND CLAWBACK
- Notwithstanding any other rule of the Plan, the Board may, in its discretion in the circumstances referred to in rule 8.2, determine at any time prior to the third anniversaryendof the Date on which an Award VestsRecovery Periodto:
- if the Award has not Vested or the Award is an Option and has not been exercised, reduce the number of Shares to which the Award relates;
- if the Award has not Vested or the Award is an Option and has not been exercised, cancel the Award;
- if the Award has not Vested or the Award is an Option and has not been exercised, impose further conditions on the Award; or
- if the Award has Vested and, if it is an Option, been exercised, require that the Participant:
- transfer for nil consideration (or procure such transfer) to the Company (or the Trustee or any other person nominated by the Company) some or all of Shares delivered to them under the Award; and/or
- make a cash payment to the Company in respect of some or all of the Shares or cash delivered to them under the Award.
- The relevant circumstances for the purposes of rule 8.1 are:
- a material misstatement of any Group Member's financial results;
- a material error in assessing an Award's Performance Condition or in the information or assumptions on which the Award was granted or Vests;
- a material failure of risk management in any Group Member or a relevant business unit;
- serious reputational damage to any Group Member or a relevant business unit;
- serious misconduct or material error on the part of the Participant;
- material corporate failure in any Group Member or relevant business unit; or
- any other circumstances that the Board in its discretion considers to be similar in their nature or effect to those in rules 8.2.1 to 8.2.7.
- Notwithstanding any other rule of the Plan, the Board may, in its discretion, determine at any time to take the action referred to in rules 8.1.1 to 8.1.4 (inclusive) in the event of the Participant committing fraud.
- If the Board exercises its discretion in accordance with this rule 8, it will confirm this in writing to each affected Participant and, if necessary, the Trustee.
Dunelm (SoftDunelmFurnishings)(Soft Furnishings)Ltd - HIGHLYLtdCONFIDENTIAL
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Dunelm Group plc published this content on 19 October 2023 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 19 October 2023 09:02:34 UTC.