Document:

Exhibit
10.55

 

NEITHER
THE ISSUANCE AND SALE OF THE SECURITIES REPRESENTED BY THIS CERTIFICATE NOR THE SECURITIES INTO WHICH THESE SECURITIES ARE CONVERTIBLE
HAVE BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES LAWS. THE SECURITIES MAY NOT
BE OFFERED FOR SALE, SOLD, TRANSFERRED OR ASSIGNED IN THE ABSENCE OF (A) AN EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES
UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR (B) AN OPINION OF COUNSEL (WHICH COUNSEL SHALL BE SELECTED BY THE HOLDER), IN
A GENERALLY ACCEPTABLE FORM, THAT REGISTRATION IS NOT REQUIRED UNDER SAID ACT. NOTWITHSTANDING THE FOREGOING, THE SECURITIES MAY
BE PLEDGED IN CONNECTION WITH A BONA FIDE MARGIN ACCOUNT OR OTHER LOAN OR FINANCING ARRANGEMENT SECURED BY THE SECURITIES.

 

	Principal Amount: $64,900.00	 	Issue Date: March 18, 2020
	Purchase Price:  $63,000.00	 	Funding and Effective Date: March 19, 2020
	Original Issue Discount: $1,900.00	 	 

  

CONVERTIBLE
PROMISSORY NOTE

 

FOR
VALUE RECEIVED, BIOXYTRAN, INC., a Nevada corporation
(hereinafter called the “Borrower”), hereby promises to pay to the order of POWER
UP LENDING GROUP LTD., a Virginia corporation, or registered assigns (the “Holder”) the sum of $64,900.00
together with any interest as set forth herein, on March 18, 2021 (the “Maturity Date”), and to pay interest on the
unpaid principal balance hereof at the rate of eight percent (8%)(the “Interest Rate”) per annum from the date hereof
(the “Issue Date”) until the same becomes due and payable, whether at maturity or upon acceleration or by prepayment
or otherwise. This Note may not be prepaid in whole or in part except as otherwise explicitly set forth herein. Any amount of principal
or interest on this Note which is not paid when due shall bear interest at the rate of twenty two percent (22%) per annum from
the due date thereof until the same is paid (“Default Interest”). Interest shall be computed on the basis of a 365
day year and the actual number of days elapsed. Interest shall commence accruing on the Issue Date but shall not be payable until
the Note becomes payable (whether at Maturity Date or upon acceleration or by prepayment). All payments due hereunder (to the extent
not converted into common stock, $0.001 par value per share (the “Common Stock”) in accordance with the terms hereof)
shall be made in lawful money of the United States of America. All payments shall be made at such address as the Holder shall hereafter
give to the Borrower by written notice made in accordance with the provisions of this Note. Each capitalized term used herein,
and not otherwise defined, shall have the meaning ascribed thereto in that certain Securities Purchase Agreement dated the date
hereof, pursuant to which this Note was originally issued (the “Purchase Agreement”).

 

This
Note is free from all taxes, liens, claims and encumbrances with respect to the issue thereof and shall not be subject to preemptive
rights or other similar rights of shareholders of the Borrower and will not impose personal liability upon the holder thereof.

 

     

     

    

 

The
following terms shall apply to this Note:

 

Article
I. CONVERSION RIGHTS

 

1.1
Conversion Right. The Holder shall have the right from time to time, and at any time during the period beginning on the
date which is one hundred eighty (180) days following the date of this Note and ending on the later of: (i) the Maturity Date
and (ii) the date of payment of the Default Amount (as defined in Article III), each in respect of the remaining outstanding amount
of this Note to convert all or any part of the outstanding and unpaid amount of this Note into fully paid and non-assessable shares
of Common Stock, as such Common Stock exists on the Issue Date, or any shares of capital stock or other securities of the Borrower
into which such Common Stock shall hereafter be changed or reclassified at the conversion price (the “Conversion Price”)
determined as provided herein (a “Conversion”); provided, however, that in no event shall the Holder
be entitled to convert any portion of this Note in excess of that portion of this Note upon conversion of which the sum of (1)
the number of shares of Common Stock beneficially owned by the Holder and its affiliates (other than shares of Common Stock which
may be deemed beneficially owned through the ownership of the unconverted portion of the Notes or the unexercised or unconverted
portion of any other security of the Borrower subject to a limitation on conversion or exercise analogous to the limitations contained
herein) and (2) the number of shares of Common Stock issuable upon the conversion of the portion of this Note with respect to
which the determination of this proviso is being made, would result in beneficial ownership by the Holder and its affiliates of
more than 4.99% of the outstanding shares of Common Stock. For purposes of the proviso to the immediately preceding sentence,
beneficial ownership shall be determined in accordance with Section 13(d) of the Securities Exchange Act of 1934, as amended (the
“Exchange Act”), and Regulations 13D-G thereunder, except as otherwise provided in clause (1) of such proviso. The
beneficial ownership limitations on conversion as set forth in the section may NOT be waived by the Holder. The number of
shares of Common Stock to be issued upon each conversion of this Note shall be determined by dividing the Conversion Amount (as
defined below) by the applicable Conversion Price then in effect on the date specified in the notice of conversion, in the form
attached hereto as Exhibit A (the “Notice of Conversion”), delivered to the Borrower by the Holder in accordance with
Section 1.4 below; provided that the Notice of Conversion is submitted by facsimile or e-mail (or by other means resulting in,
or reasonably expected to result in, notice) to the Borrower before 6:00 p.m., New York, New York time on such conversion date
(the “Conversion Date”); however, if the Notice of Conversion is sent after 6:00pm, New York, New York time the Conversion
Date shall be the next business day. The term “Conversion Amount” means, with respect to any conversion of this Note,
the sum of (1) the principal amount of this Note to be converted in such conversion plus (2) at the Holder’s option,
accrued and unpaid interest, if any, on such principal amount at the interest rates provided in this Note to the Conversion Date,
plus (3) at the Holder’s option, Default Interest, if any, on the amounts referred to in the immediately preceding
clauses (1) and/or (2) plus (4) at the Holder’s option, any amounts owed to the Holder pursuant to Sections 1.4 hereof.

 

1.2
Conversion Price. The Conversion Price shall equal the Variable Conversion Price (as defined herein)(subject to equitable
adjustments for stock splits, stock dividends or rights offerings by the Borrower relating to the Borrower’s securities
or the securities of any subsidiary of the Borrower, combinations, recapitalization, reclassifications, extraordinary distributions
and similar events). The "Variable Conversion Price" shall mean 65% multiplied by the Market Price (as defined herein)
(representing a discount rate of 35%). “Market Price” means the  lowest Trading Price (as
defined below) for the Common Stock during the twenty (20) Trading Day period ending on the latest complete Trading Day prior
to the Conversion Date. “Trading Price” means, for any security as of any date, the closing bid price on the OTCQB,
OTCQX, Pink Sheets electronic quotation system or applicable trading market (the “OTC”) as reported by a reliable
reporting service (“Reporting Service”) designated by the Holder (i.e. Bloomberg) or, if the OTC is not the principal
trading market for such security, the closing bid price of such security on the principal securities exchange or trading market
where such security is listed or traded or, if no closing bid price of such security is available in any of the foregoing manners,
the average of the closing bid prices of any market makers for such security that are listed in the “pink sheets”.
If the Trading Price cannot be calculated for such security on such date in the manner provided above, the Trading Price shall
be the fair market value as mutually determined by the Borrower and the holders of a majority in interest of the Notes being converted
for which the calculation of the Trading Price is required in order to determine the Conversion Price of such Notes. “Trading
Day” shall mean any day on which the Common Stock is tradable for any period on the OTC, or on the principal securities
exchange or other securities market on which the Common Stock is then being traded.

 

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1.3
Authorized Shares. The Borrower covenants that during the period the conversion right exists, the Borrower will reserve
from its authorized and unissued Common Stock a sufficient number of shares, free from preemptive rights, to provide for the issuance
of Common Stock upon the full conversion of this Note issued pursuant to the Purchase Agreement. The Borrower is required at all
times to have authorized and reserved five (5) times the number of shares that would be issuable upon full conversion of the Note
(assuming that the 4.99% limitation set forth in Section 1.1 is not in effect)(based on the respective Conversion Price of the
Note (as defined in Section 1.2) in effect from time to time, initially 2955373 shares)(the
“Reserved Amount”). The Reserved Amount shall be increased (or decreased with the written consent of the Holder) from
time to time in accordance with the Borrower’s obligations hereunder. The Borrower represents that upon issuance, such shares
will be duly and validly issued, fully paid and non-assessable. In addition, if the Borrower shall issue any securities or make
any change to its capital structure which would change the number of shares of Common Stock into which the Notes shall be convertible
at the then current Conversion Price, the Borrower shall at the same time make proper provision so that thereafter there shall
be a sufficient number of shares of Common Stock authorized and reserved, free from preemptive rights, for conversion of the outstanding
Note. The Borrower (i) acknowledges that it has irrevocably instructed its transfer agent to issue certificates for the Common
Stock issuable upon conversion of this Note, and (ii) agrees that its issuance of this Note shall constitute full authority
to its officers and agents who are charged with the duty of executing stock certificates to execute and issue the necessary certificates
for shares of Common Stock in accordance with the terms and conditions of this Note.

 

If,
at any time the Borrower does not maintain the Reserved Amount it will be considered an Event of Default under Section 3.2 of
the Note.

 

1.4
Method of Conversion.

 

(a)
Mechanics of Conversion. As set forth in Section 1.1 hereof, from time to time, and at any time during the period beginning
on the date which is one hundred eighty (180) days following the date of this Note and ending on the later of: (i) the Maturity
Date and (ii) the date of payment of the Default Amount, this Note may be converted by the Holder in whole or in part at any time
from time to time after the Issue Date, by (A) submitting to the Borrower a Notice of Conversion (by facsimile, e-mail or
other reasonable means of communication dispatched on the Conversion Date prior to 6:00 p.m., New York, New York time) and (B) subject
to Section 1.4(b), surrendering this Note at the principal office of the Borrower (upon payment in full of any amounts owed hereunder).

 

(b)
Surrender of Note Upon Conversion. Notwithstanding anything to the contrary set forth herein, upon conversion of this Note
in accordance with the terms hereof, the Holder shall not be required to physically surrender this Note to the Borrower unless
the entire unpaid principal amount of this Note is so converted. The Holder and the Borrower shall maintain records showing the
principal amount so converted and the dates of such conversions or shall use such other method, reasonably satisfactory to the
Holder and the Borrower, so as not to require physical surrender of this Note upon each such conversion.

 

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(c)
Delivery of Common Stock Upon Conversion. Upon receipt by the Borrower from the Holder of a facsimile transmission or e-mail
(or other reasonable means of communication) of a Notice of Conversion meeting the requirements for conversion as provided in
this Section 1.4, the Borrower shall issue and deliver or cause to be issued and delivered to or upon the order of the Holder
certificates for the Common Stock issuable upon such conversion within three (3) business days after such receipt (the “Deadline”)
(and, solely in the case of conversion of the entire unpaid principal amount hereof, surrender of this Note) in accordance with
the terms hereof and the Purchase Agreement. Upon receipt by the Borrower of a Notice of Conversion, the Holder shall be deemed
to be the holder of record of the Common Stock issuable upon such conversion, the outstanding principal amount and the amount
of accrued and unpaid interest on this Note shall be reduced to reflect such conversion, and, unless the Borrower defaults on
its obligations hereunder, all rights with respect to the portion of this Note being so converted shall forthwith terminate except
the right to receive the Common Stock or other securities, cash or other assets, as herein provided, on such conversion. If the
Holder shall have given a Notice of Conversion as provided herein, the Borrower’s obligation to issue and deliver the certificates
for Common Stock shall be absolute and unconditional, irrespective of the absence of any action by the Holder to enforce the same,
any waiver or consent with respect to any provision thereof, the recovery of any judgment against any person or any action to
enforce the same, any failure or delay in the enforcement of any other obligation of the Borrower to the holder of record, or
any setoff, counterclaim, recoupment, limitation or termination, or any breach or alleged breach by the Holder of any obligation
to the Borrower, and irrespective of any other circumstance which might otherwise limit such obligation of the Borrower to the
Holder in connection with such conversion.

 

(d)
Delivery of Common Stock by Electronic Transfer. In lieu of delivering physical certificates representing the Common Stock
issuable upon conversion, provided the Borrower is participating in the Depository Trust Company (“DTC”) Fast Automated
Securities Transfer (“FAST”) program, upon request of the Holder and its compliance with the provisions set forth
herein, the Borrower shall use its best efforts to cause its transfer agent to electronically transmit the Common Stock issuable
upon conversion to the Holder by crediting the account of Holder’s Prime Broker with DTC through its Deposit Withdrawal
Agent Commission (“DWAC”) system.

 

(e)
Failure to Deliver Common Stock Prior to Deadline. Without in any way limiting the Holder’s right to pursue other
remedies, including actual damages and/or equitable relief, the parties agree that if delivery of the Common Stock issuable upon
conversion of this Note is not delivered by the Deadline due to the willful, intentional and purposeful action and/or inaction
of the Borrower which results in the failure to issue the Common Stock upon conversion, the Borrower shall pay to the Holder $2,000
per day in cash, for each day beyond the Deadline that the Borrower fails to deliver such Common Stock (the “Fail to Deliver
Fee”); provided; however that the Fail to Deliver Fee shall not be due if the failure is a result of the Holder or a third
party (i.e., transfer agent; and not the result of any failure to pay such transfer agent) despite the best efforts of the Borrower
to effect delivery of such Common Stock. Such cash amount shall be paid to Holder by the fifth day of the month following the
month in which it has accrued or, at the option of the Holder (by written notice to the Borrower by the first day of the month
following the month in which it has accrued), shall be added to the principal amount of this Note, in which event interest shall
accrue thereon in accordance with the terms of this Note and such additional principal amount shall be convertible into Common
Stock in accordance with the terms of this Note. The Borrower agrees that the right to convert is a valuable right to the Holder.
The damages resulting from a failure, attempt to frustrate, interference with such conversion right are difficult if not impossible
to qualify. Accordingly, the parties acknowledge that the liquidated damages provision contained in this Section 1.4(e) are justified.

 

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1.5
Concerning the Shares. The shares of Common Stock issuable upon conversion of this Note may not be sold or transferred
unless: (i) such shares are sold pursuant to an effective registration statement under the Act or (ii) the Borrower or its transfer
agent shall have been furnished with an opinion of counsel (which opinion shall be in form, substance and scope customary for
opinions of counsel in comparable transactions) to the effect that the shares to be sold or transferred may be sold or transferred
pursuant to an exemption from such registration (such as Rule 144 or a successor rule) (“Rule 144”); or (iii) such
shares are transferred to an “affiliate” (as defined in Rule 144) of the Borrower who agrees to sell or otherwise
transfer the shares only in accordance with this Section 1.5 and who is an Accredited Investor (as defined in the Purchase Agreement).

 

Any
restrictive legend on certificates representing shares of Common Stock issuable upon conversion of this Note shall be removed
and the Borrower shall issue to the Holder a new certificate therefore free of any transfer legend if the Borrower or its transfer
agent shall have received an opinion of counsel from Holder’s counsel, in form, substance and scope customary for opinions
of counsel in comparable transactions, to the effect that (i) a public sale or transfer of such Common Stock may be made without
registration under the Act, which opinion shall be accepted by the Company so that the sale or transfer is effected; or (ii) in
the case of the Common Stock issuable upon conversion of this Note, such security is registered for sale by the Holder under an
effective registration statement filed under the Act; or otherwise may be sold pursuant to an exemption from registration. In
the event that the Company does not reasonably accept the opinion of counsel provided by the Holder with respect to the transfer
of Securities pursuant to an exemption from registration (such as Rule 144), at the Deadline, it will be considered an Event of
Default pursuant to Section 3.2 of the Note.

 

1.6
Effect of Certain Events.

 

(a)
Effect of Merger, Consolidation, Etc. At the option of the Holder, the sale, conveyance or disposition of all or substantially
all of the assets of the Borrower, the effectuation by the Borrower of a transaction or series of related transactions in which
more than 50% of the voting power of the Borrower is disposed of, or the consolidation, merger or other business combination of
the Borrower with or into any other Person (as defined below) or Persons when the Borrower is not the survivor shall be deemed
to be an Event of Default (as defined in Article III) pursuant to which the Borrower shall be required to pay to the Holder upon
the consummation of and as a condition to such transaction an amount equal to the Default Amount (as defined in Article III).
“Person” shall mean any individual, corporation, limited liability company, partnership, association, trust or other
entity or organization.

 

(b)
Adjustment Due to Merger, Consolidation, Etc. If, at any time when this Note is issued and outstanding and prior to conversion
of all of the Note, there shall be any merger, consolidation, exchange of shares, recapitalization, reorganization, or other similar
event, as a result of which shares of Common Stock of the Borrower shall be changed into the same or a different number of shares
of another class or classes of stock or securities of the Borrower or another entity, or in case of any sale or conveyance of
all or substantially all of the assets of the Borrower other than in connection with a plan of complete liquidation of the Borrower,
then the Holder of this Note shall thereafter have the right to receive upon conversion of this Note, upon the basis and upon
the terms and conditions specified herein and in lieu of the shares of Common Stock immediately theretofore issuable upon conversion,
such stock, securities or assets which the Holder would have been entitled to receive in such transaction had this Note been converted
in full immediately prior to such transaction (without regard to any limitations on conversion set forth herein), and in any such
case appropriate provisions shall be made with respect to the rights and interests of the Holder of this Note to the end that
the provisions hereof (including, without limitation, provisions for adjustment of the Conversion Price and of the number of shares
issuable upon conversion of the Note) shall thereafter be applicable, as nearly as may be practicable in relation to any securities
or assets thereafter deliverable upon the conversion hereof. The Borrower shall not affect any transaction described in this Section
1.6(b) unless (a) it first gives, to the extent practicable, ten (10) days prior written notice (but in any event at least five
(5) days prior written notice) of the record date of the special meeting of shareholders to approve, or if there is no such record
date, the consummation of, such merger, consolidation, exchange of shares, recapitalization, reorganization or other similar event
or sale of assets (during which time the Holder shall be entitled to convert this Note) and (b) the resulting successor or acquiring
entity (if not the Borrower) assumes by written instrument the obligations of this Note. The above provisions shall similarly
apply to successive consolidations, mergers, sales, transfers or share exchanges.

 

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(c)
Adjustment Due to Distribution. If the Borrower shall declare or make any distribution of its assets (or rights to acquire
its assets) to holders of Common Stock as a dividend, stock repurchase, by way of return of capital or otherwise (including any
dividend or distribution to the Borrower’s shareholders in cash or shares (or rights to acquire shares) of capital stock
of a subsidiary (i.e., a spin-off)) (a “Distribution”), then the Holder of this Note shall be entitled, upon any conversion
of this Note after the date of record for determining shareholders entitled to such Distribution, to receive the amount of such
assets which would have been payable to the Holder with respect to the shares of Common Stock issuable upon such conversion had
such Holder been the holder of such shares of Common Stock on the record date for the determination of shareholders entitled to
such Distribution.

 

1.7
Prepayment. Notwithstanding anything to the contrary contained in this Note, at any time during the periods set forth on
the table immediately following this paragraph (the “Prepayment Periods”), the Borrower shall have the right, exercisable
on not more than three (3) Trading Days prior written notice to the Holder of the Note to prepay the outstanding Note (principal
and accrued interest), in full, in accordance with this Section 1.7. Any notice of prepayment hereunder (an “Optional Prepayment
Notice”) shall be delivered to the Holder of the Note at its registered addresses and shall state: (1) that the Borrower
is exercising its right to prepay the Note, and (2) the date of prepayment which shall be not more than three (3) Trading Days
from the date of the Optional Prepayment Notice. On the date fixed for prepayment (the “Optional Prepayment Date”),
the Borrower shall make payment of the Optional Prepayment Amount (as defined below) to Holder, or upon the direction of the Holder
as specified by the Holder in a writing to the Borrower (which shall direction to be sent to Borrower by the Holder at least one
(1) business day prior to the Optional Prepayment Date). If the Borrower exercises its right to prepay the Note, the Borrower
shall make payment to the Holder of an amount in cash equal to the percentage (“Prepayment Percentage”) as set forth
in the table immediately following this paragraph opposite the applicable Prepayment Period, multiplied by the sum of: (w) the
then outstanding principal amount of this Note plus (x) accrued and unpaid interest on the unpaid principal amount
of this Note to the Optional Prepayment Date plus (y) Default Interest, if any, on the amounts referred to in clauses (w)
and (x) plus (z) any amounts owed to the Holder pursuant to Section 1.4 hereof (the “Optional Prepayment Amount”).

 

	 	Prepayment
    Period	 	Prepayment
    Percentage	 
	1.	The
period beginning on the Issue Date and ending on the date which is thirty (30) days following the Issue Date.	 	 	115	%
	2.	The period
beginning on the date which is thirty-one (31) days following the Issue Date and ending on the date which is sixty (60) days following
the Issue Date.	 	 	120	%
	3.	The period
beginning on the date which is sixty-one (61) days following the Issue Date and ending on the date which is ninety (90) days following
the Issue Date.	 	 	125	%
	4.	The period
beginning on the date that is ninety-one (91) days from the Issue Date and ending one hundred twenty (120) days following the
Issue Date.	 	 	130	%
	5.	The period
beginning on the date that is one hundred twenty-one (121) days from the Issue Date and ending one hundred fifty (150) days following
the Issue Date.	 	 	135	%
	6.	The period
beginning on the date that is one hundred fifty-one (151) days from the Issue Date and ending one hundred eighty (180) days following
the Issue Date.	 	 	140	%
	7.	The period
beginning on the date that is one hundred eight-one (181) days from the Issue Date and ending three hundred sixty (360) days following
the Issue Date.	 	 	145	%

 

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After
the expiration of three hundred sixty (360) days following the Issue Date, the Borrower shall have no right of prepayment. Notwithstanding
anything contained herein to the contrary, the Holder’s conversion rights herein shall not be affected in any way until
the Note is fully paid (funds received by the Holder) pursuant to an Optional Prepayment Notice.

 

Article
II.  CERTAIN COVENANTS

 

2.1
Sale of Assets. So long as the Borrower shall have any obligation under this Note, the Borrower shall not, without the
Holder’s written consent, sell, lease or otherwise dispose of any significant portion of its assets outside the ordinary
course of business. Any consent to the disposition of any assets may be conditioned on a specified use of the proceeds of disposition.

 

Article
III.  EVENTS OF DEFAULT

 

If
any of the following events of default (each, an “Event of Default”) shall occur:

 

3.1
Failure to Pay Principal and Interest. The Borrower fails to pay the principal hereof or interest thereon when due on this
Note, whether at maturity or upon acceleration and such breach continues for a period of five (5) days after written notice from
the Holder.

 

3.2
Conversion and the Shares. The Borrower fails to issue shares of Common Stock to the Holder (or announces or threatens
in writing that it will not honor its obligation to do so) upon exercise by the Holder of the conversion rights of the Holder
in accordance with the terms of this Note, fails to transfer or cause its transfer agent to transfer (issue) (electronically or
in certificated form) any certificate for shares of Common Stock issued to the Holder upon conversion of or otherwise pursuant
to this Note as and when required by this Note, the Borrower directs its transfer agent not to transfer or delays, impairs, and/or
hinders its transfer agent in transferring (or issuing) (electronically or in certificated form) any certificate for shares of
Common Stock to be issued to the Holder upon conversion of or otherwise pursuant to this Note as and when required by this Note,
or fails to remove (or directs its transfer agent not to remove or impairs, delays, and/or hinders its transfer agent from removing)
any restrictive legend (or to withdraw any stop transfer instructions in respect thereof) on any certificate for any shares of
Common Stock issued to the Holder upon conversion of or otherwise pursuant to this Note as and when required by this Note (or
makes any written announcement, statement or threat that it does not intend to honor the obligations described in this paragraph)
and any such failure shall continue uncured (or any written announcement, statement or threat not to honor its obligations shall
not be rescinded in writing) for three (3) business days after the Holder shall have delivered a Notice of Conversion. It is an
obligation of the Borrower to remain current in its obligations to its transfer agent. It shall be an event of default of this
Note, if a conversion of this Note is delayed, hindered or frustrated due to a balance owed by the Borrower to its transfer agent.
If at the option of the Holder, the Holder advances any funds to the Borrower’s transfer agent in order to process a conversion,
such advanced funds shall be paid by the Borrower to the Holder within forty-eight (48) hours of a demand from the Holder.

 

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3.3
Breach of Covenants. The Borrower breaches any material covenant or other material term or condition contained in this
Note and any collateral documents including but not limited to the Purchase Agreement and such breach continues for a period of
twenty (20) days after written notice thereof to the Borrower from the Holder.

 

3.4
Breach of Representations and Warranties. Any representation or warranty of the Borrower made herein or in any agreement,
statement or certificate given in writing pursuant hereto or in connection herewith (including, without limitation, the Purchase
Agreement), shall be false or misleading in any material respect when made and the breach of which has (or with the passage of
time will have) a material adverse effect on the rights of the Holder with respect to this Note or the Purchase Agreement.

 

3.5
Receiver or Trustee. The Borrower or any subsidiary of the Borrower shall make an assignment for the benefit of creditors,
or apply for or consent to the appointment of a receiver or trustee for it or for a substantial part of its property or business,
or such a receiver or trustee shall otherwise be appointed.

 

3.6
Bankruptcy. Bankruptcy, insolvency, reorganization or liquidation proceedings or other proceedings, voluntary or involuntary,
for relief under any bankruptcy law or any law for the relief of debtors shall be instituted by or against the Borrower or any
subsidiary of the Borrower.

 

3.7
Delisting of Common Stock. The Borrower shall fail to maintain the listing of the Common Stock on at least one of the OTC
(which specifically includes the OTCQB and OTC Pink quotation platforms maintained by the OTC Markets Group) or an equivalent
replacement exchange, the Nasdaq National Market, the Nasdaq SmallCap Market, the New York Stock Exchange, or the American Stock
Exchange.

 

3.8
Failure to Comply with the Exchange Act. The Borrower shall fail to comply with the reporting requirements of the Exchange
Act; and/or the Borrower shall cease to be subject to the reporting requirements of the Exchange Act (the filing of a Form 15
with the SEC is an immediate Event of Default).

 

3.9
Liquidation. Any dissolution, liquidation, or winding up of Borrower or any substantial portion of its business.

 

3.10
Cessation of Operations. Any cessation of operations by Borrower or Borrower admits it is otherwise generally unable to
pay its debts as such debts become due, provided, however, that any disclosure of the Borrower’s ability to continue as
a “going concern” shall not be an admission that the Borrower cannot pay its debts as they become due.

 

3.11
Financial Statement Restatement. The restatement of any financial statements filed by the Borrower with the SEC at any
time after 180 days after the Issuance Date for any date or period until this Note is no longer outstanding, if the result of
such restatement would, by comparison to the un-restated financial statement, have constituted a material adverse effect on financial
condition of the Borrower and affecting the rights of the Holder with respect to this Note or the Purchase Agreement.

 

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3.12
Replacement of Transfer Agent. In the event that the Borrower proposes to replace its transfer agent, the Borrower fails
to provide, prior to the effective date of such replacement, a fully executed Irrevocable Transfer Agent Instructions in a form
as initially delivered pursuant to the Purchase Agreement (including but not limited to the provision to irrevocably reserve shares
of Common Stock in the Reserved Amount) signed by the successor transfer agent to Borrower and the Borrower.

 

3.13
Cross-Default. Notwithstanding anything to the contrary contained in this Note or the other related or companion
documents, a material breach or default by the Borrower of any material covenant or other term or condition contained in any of
the Other Agreements, after the passage of all applicable notice and cure or grace periods, shall, at the option of the Holder,
be considered a default under this Note and the Other Agreements, in which event the Holder shall be entitled (but in no event
required) to apply all rights and remedies of the Holder under the terms of this Note and the Other Agreements by reason of a
default under said Other Agreement or hereunder. “Other Agreements” means, collectively, all agreements and instruments
between, among or by: (1) the Borrower, and, or for the benefit of, (2) the Holder and any affiliate of the Holder, including,
without limitation, promissory notes; provided, however, the term “Other Agreements” shall not include the related
or companion documents to this Note. Each of the loan transactions will be cross-defaulted with each other loan transaction and
with all other existing and future debt of Borrower to the Holder.

 

Upon
the occurrence and during the continuation of any Event of Default specified in Section 3.1 (solely with respect to failure to
pay the principal hereof or interest thereon when due at the Maturity Date), the Note shall become immediately due and payable
and the Borrower shall pay to the Holder, in full satisfaction of its obligations hereunder, an amount equal to the Default Amount
(as defined herein).  UPON THE OCCURRENCE AND DURING THE CONTINUATION OF ANY EVENT OF DEFAULT SPECIFIED IN SECTION 3.2, DUE
TO THE TO THE WILLFUL, INTENTIONAL AND PURPOSEFUL ACTION AND/OR INACTION OF THE BORROWER WHICH RESULTS IN THE FAILURE TO ISSUE
THE COMMON STOCK UPON CONVERSION, THE NOTE SHALL BECOME IMMEDIATELY DUE AND PAYABLE AND THE BORROWER SHALL PAY TO THE HOLDER, IN FULL SATISFACTION
OF ITS OBLIGATIONS HEREUNDER, AN AMOUNT EQUAL TO: (Y) THE DEFAULT AMOUNT (AS DEFINED HEREIN); MULTIPLIED BY (Z) TWO (2). Upon
the occurrence and during the continuation of any Event of Default specified in Sections 3.1 (solely with respect to failure to
pay the principal hereof or interest thereon when due on this Note upon a Trading Market Prepayment Event pursuant to Section
1.7 or upon acceleration), 3.2 (other than as set forth in the immediately preceding sentence, 3.3, 3.4, 3.7, 3.8, 3.10, 3.11,
3.12, 3.13, and/or 3.14 exercisable through the delivery of written notice to the Borrower by such Holders (the “Default
Notice”), and upon the occurrence of an Event of Default specified the remaining sections of Articles III (other than failure
to pay the principal hereof or interest thereon at the Maturity Date specified in Section 3,1 hereof), the Note shall become immediately
due and payable and the Borrower shall pay to the Holder, in full satisfaction of its obligations hereunder, an amount equal to
150% times the sum of (w) the then outstanding principal amount of this Note plus (x) accrued and unpaid
interest on the unpaid principal amount of this Note to the date of payment (the “Mandatory Prepayment Date”) plus
(y) Default Interest, if any, on the amounts referred to in clauses (w) and/or (x) plus (z) any amounts owed to the
Holder pursuant to Sections 1.3 and 1.4(g) hereof (the then outstanding principal amount of this Note to the date of payment plus
the amounts referred to in clauses (x), (y) and (z) shall collectively be known as the “Default Amount”) and all
other amounts payable hereunder shall immediately become due and payable, all without demand, presentment or notice, all of which
hereby are expressly waived, together with all costs, including, without limitation, legal fees and expenses, of collection, and
the Holder shall be entitled to exercise all other rights and remedies available at law or in equity. 

 

    9

     

    

 

If
the Borrower fails to pay the Default Amount within five (5) business days of written notice that such amount is due and payable,
then the Holder shall have the right at any time, so long as the Borrower remains in default (and so long and to the extent that
there are sufficient authorized shares), to require the Borrower, upon written notice, to immediately issue, in lieu of the Default
Amount, the number of shares of Common Stock of the Borrower equal to the Default Amount divided by the Conversion Price then
in effect.

 

Article
IV. MISCELLANEOUS

 

4.1
Failure or Indulgence Not Waiver. No failure or delay on the part of the Holder in the exercise of any power, right or
privilege hereunder shall operate as a waiver thereof, nor shall any single or partial exercise of any such power, right or privilege
preclude other or further exercise thereof or of any other right, power or privileges. All rights and remedies existing hereunder
are cumulative to, and not exclusive of, any rights or remedies otherwise available.

 

4.2
Notices. All notices, demands, requests, consents, approvals, and other communications required or permitted hereunder
shall be in writing and, unless otherwise specified herein, shall be (i) personally served, (ii) deposited in the mail, registered
or certified, return receipt requested, postage prepaid, (iii) delivered by reputable air courier service with charges prepaid,
or (iv) transmitted by hand delivery, telegram, facsimile or email, addressed as set forth below or to such other address as such
party shall have specified most recently by written notice. Any notice or other communication required or permitted to be given
hereunder shall be deemed effective (a) upon hand delivery or delivery by facsimile, with accurate confirmation generated by the
transmitting facsimile machine, at the address or number designated below (if delivered on a business day during normal business
hours where such notice is to be received), or the first business day following such delivery (if delivered other than on a business
day during normal business hours where such notice is to be received) or (b) on the second business day following the date of
mailing by express courier service, fully prepaid, addressed to such address, or upon actual receipt of such mailing, whichever
shall first occur. The addresses for such communications shall be:

 

If
to the Borrower, to:

 

BIOXYTRAN,
INC.233 Needham St., Ste 300

Newton,
MA 02464

Attn:
Dr. David Platt, Chief Executive Officer

Fax:

Email:
David.Platt@bioxytraninc.com

 

If
to the Holder:

 

POWER
UP LENDING GROUP LTD.

111
Great Neck Road, Suite 214

Great
Neck, NY 11021

Attn:
Curt Kramer, Chief Executive Officer

e-mail:
info@poweruplending.com

 

    10

     

    

 

With
a copy by fax only to (which copy shall not constitute notice):

 

Naidich
Wurman LLP

111
Great Neck Road, Suite 216

Great
Neck, NY 11021

Attn:
Allison Naidich

facsimile:
516-466-3555

e-mail:
allison@nwlaw.com

 

4.3
Amendments. This Note and any provision hereof may only be amended by an instrument in writing signed by the Borrower and
the Holder. The term “Note” and all reference thereto, as used throughout this instrument, shall mean this instrument
(and the other Notes issued pursuant to the Purchase Agreement) as originally executed, or if later amended or supplemented, then
as so amended or supplemented.

 

4.4
Assignability. This Note shall be binding upon the Borrower and its successors and assigns, and shall inure to be the benefit
of the Holder and its successors and assigns. Each transferee of this Note must be an “accredited investor” (as defined
in Rule 501(a) of the Securities and Exchange Commission). Notwithstanding anything in this Note to the contrary, this Note may
be pledged as collateral in connection with a bona fide margin account or other lending arrangement; and may be assigned
by the Holder without the consent of the Borrower.

 

4.5
Cost of Collection. If default is made in the payment of this Note, the Borrower shall pay the Holder hereof costs of collection,
including reasonable attorneys’ fees.

 

4.6
Governing Law. This Note shall be governed by and construed in accordance with the laws of the State of Virginia without
regard to principles of conflicts of laws. Any action brought by either party against the other concerning the transactions contemplated
by this Note shall be brought only in the state courts of New York or in the federal courts located in the Eastern District of
New York. The parties to this Note hereby irrevocably waive any objection to jurisdiction and venue of any action instituted hereunder
and shall not assert any defense based on lack of jurisdiction or venue or based upon forum non conveniens. The Borrower
and Holder waive trial by jury. The prevailing party shall be entitled to recover from the other party its reasonable attorney's
fees and costs. In the event that any provision of this Note or any other agreement delivered in connection herewith is invalid
or unenforceable under any applicable statute or rule of law, then such provision shall be deemed inoperative to the extent that
it may conflict therewith and shall be deemed modified to conform with such statute or rule of law. Any such provision which may
prove invalid or unenforceable under any law shall not affect the validity or enforceability of any other provision of any agreement.
Each party hereby irrevocably waives personal service of process and consents to process being served in any suit, action or proceeding
in connection with this Note, any agreement or any other document delivered in connection with this Note by mailing a copy thereof
via registered or certified mail or overnight delivery (with evidence of delivery) to such party at the address in effect for
notices to it under this Note and agrees that such service shall constitute good and sufficient service of process and notice
thereof. Nothing contained herein shall be deemed to limit in any way any right to serve process in any other manner permitted
by law.

 

4.7
Purchase Agreement. By its acceptance of this Note, each party agrees to be bound by the applicable terms of the Purchase
Agreement.

 

    11

     

    

 

4.8
Remedies. The Borrower acknowledges that a breach by it of its obligations hereunder will cause irreparable harm to the
Holder, by vitiating the intent and purpose of the transaction contemplated hereby. Accordingly, the Borrower acknowledges that
the remedy at law for a breach of its obligations under this Note will be inadequate and agrees, in the event of a breach or threatened
breach by the Borrower of the provisions of this Note, that the Holder shall be entitled, in addition to all other available remedies
at law or in equity, and in addition to the penalties assessable herein, to an injunction or injunctions restraining, preventing
or curing any breach of this Note and to enforce specifically the terms and provisions thereof, without the necessity of showing
economic loss and without any bond or other security being required.

 

IN
WITNESS WHEREOF, Borrower has caused this Note to be signed in its name by its duly authorized officer this on March 18, 2020.

 

	BIOXYTRAN,
    INC.	 
	 	 
	 	 
	By:
    	 	 
	 	 	 
	 	Chief Executive Officer	 

 

    12

     

    

 

EXHIBIT
A — NOTICE OF CONVERSION

 

The undersigned
hereby elects to convert $_________________ principal amount of the Note (defined below) into that number of shares of Common
Stock to be issued pursuant to the conversion of the Note (“Common Stock”) as set forth below, of BIOXYTRAN, INC.,
a Nevada corporation (the “Borrower”) according to the conditions of the convertible note of the Borrower dated as
of March 18, 2020 (the “Note”), as of the date written below. No fee will be charged to the Holder for any conversion,
except for transfer taxes, if any.

 

Box
Checked as to applicable instructions:

 

		☐	The
                                         Borrower shall electronically transmit the Common Stock issuable pursuant to this Notice
                                         of Conversion to the account of the undersigned or its nominee with DTC through its Deposit
                                         Withdrawal Agent At Custodian (“DWAC Transfer”).

 

Name
of DTC Prime Broker:

Account
Number:

 

		☐	The
                                         undersigned hereby requests that the Borrower issue a certificate or certificates for
                                         the number of shares of Common Stock set forth below (which numbers are based on the
                                         Holder’s calculation attached hereto) in the name(s) specified immediately below
                                         or, if additional space is necessary, on an attachment hereto:

 

POWER
UP LENDING GROUP LTD.

111
Great Neck Road, Suite 214

Great
Neck, NY 11021

Attention:
Certificate Delivery

e-mail:
info@poweruplendinggroup.com

 

	 	Date
    of conversion:	 			 
	 	Applicable
    Conversion Price:	 	$		 
	 	Number
    of shares of common stock to be issued pursuant to conversion of the Notes:	 	 	 	 
	 	Amount
    of Principal Balance due remaining under the Note after this conversion:	 	 	 	 

 

	 	POWER
    UP LENDING GROUP LTD.	 	 
	 	 	 	 	 
	 	By:	 	 	 
	 	Name:  	Curt
    Kramer	 
	 	Title:	Chief
    Executive Officer	 
	 	 	Date:
    _____________	 

 

 

13EX-4.4

 Exhibit 4.4 
  

 
 BRITISH AMERICAN TOBACCO P.L.C. 

 
  

RULES 
 of the 

BRITISH AMERICAN TOBACCO 

2016 LONG TERM INCENTIVE PLAN 
  

 
 Adopted pursuant
to shareholders’ approval obtained on 27 April 2016 
 and amended by the Board on 10 December 2018 

and amended by the Board on 3 June 2019 

and amended by the Board on 25 February 2020 

Herbert Smith Freehills LLP 
 HSF
Ref: 30889176 

 British American Tobacco 2016 Long Term Incentive Plan 

 

 CONTENTS 

 

							
	Clause	  	Heading	  	Page	 
	1.	  	INTERPRETATION AND CONSTRUCTION	  	 	3	 
			
	2.	  	PLAN LIMITS	  	 	5	 
			
	3.	  	AWARDS	  	 	6	 
			
	4.	  	AWARDS ARE NON-TRANSFERABLE	  	 	8	 
			
	5.	  	PERFORMANCE CONDITION	  	 	8	 
			
	6.	  	ADDITIONAL TERMS SPECIFIC TO FORFEITABLE SHARE AWARDS	  	 	8	 
			
	7.	  	VESTING	  	 	9	 
			
	8.	  	CESSATION OF OFFICE OR EMPLOYMENT	  	 	10	 
			
	9.	  	CORPORATE ACTIONS	  	 	12	 
			
	10.	  	OPTIONS	  	 	14	 
			
	11.	  	DIVIDEND EQUIVALENT	  	 	15	 
			
	12.	  	CASH ALTERNATIVE – OPTIONS AND CONDITIONAL AWARDS	  	 	15	 
			
	13.	  	TAX LIABILITY	  	 	16	 
			
	14.	  	VESTED SHARE ACCOUNTS	  	 	16	 
			
	15.	  	CLAW-BACK	  	 	17	 
			
	16.	  	VARIATION OF CAPITAL	  	 	17	 
			
	17.	  	ADMINISTRATION	  	 	18	 
			
	18.	  	AMENDMENTS	  	 	18	 
			
	19.	  	DATA PROTECTION	  	 	19	 
			
	20.	  	GENERAL	  	 	20	 
		
	APPENDIX 1 : OPERATION OF CLAW-BACK	  	 	22	 
		
	APPENDIX 2 : AWARDS GRANTED TO U.S. TAXPAYERS	  	 	24	 
			
	1.	  	INTERPRETATION	  	 	24	 
			
	2.	  	APPLICATION	  	 	24	 
			
	3.	  	PERFORMANCE AND SERVICE CONDITION	  	 	24	 
			
	4.	  	APPLICATION OF PARAGRAPH 5 AND 6	  	 	25	 
			
	5.	  	AWARDS (I) WHERE THE “WAIT AND SEE” APPROACH SHALL APPLY (INCLUDING ALL AWARDS SUBJECT TO AN EXTENDED VESTING PERIOD), (II) DESCRIBED IN PARAGRAPHS 3.1 AND 3.2 OF ADDENDUM I TO THE PLAN OR (III) THAT OTHERWISE
ARE NOT EXEMPT FROM CODE § 409A AS A SHORT-TERM DEFERRAL	  	 	25	 
			
	6.	  	AWARDS WITHOUT AN EXTENDED VESTING PERIOD AND WHERE THE “WAIT AND SEE” APPROACH DOES NOT APPLY AND THAT ARE OTHERWISE EXEMPT FROM CODE § 409A AS A SHORT-TERM DEFERRAL	  	 	26	 
			
	7.	  	DIVIDEND EQUIVALENTS	  	 	26	 
			
	8.	  	CASH ALTERNATIVE	  	 	26	 
			
	9.	  	CODE § 409A EXEMPTION AND COMPLIANCE	  	 	26	 
			
	10.	  	COOPERATION	  	 	27	 

  
 1 

 British American Tobacco 2016 Long Term Incentive Plan 

 

							
	11.	  	SETTLEMENT	  	 	27	 
		
	ADDENDUM I: AWARDS GRANTED TO RAI PARTICIPANTS (PRIOR TO 2020)	  	 	28	 
			
	1.	  	APPLICATION	  	 	28	 
			
	2.	  	MODIFICATION	  	 	28	 
			
	3.	  	TERMS	  	 	28	 
			
	4.	  	SETTLEMENT	  	 	28	 
		
	ADDENDUM II: AWARDS GRANTED TO RAI PARTICIPANTS (FROM 2020)	  	 	29	 
			
	1.	  	APPLICATION	  	 	29	 
			
	2.	  	MODIFICATION	  	 	29	 
			
	3.	  	TERMS	  	 	29	 
			
	4.	  	SETTLEMENT	  	 	29	 
		
	SCHEDULE 1 : PERFORMANCE CONDITIONS	  	 	30	 

  
 2 

 British American Tobacco 2016 Long Term Incentive Plan 

 

 RULES OF THE BRITISH AMERICAN TOBACCO P.L.C. LONG TERM INCENTIVE PLAN 

 

	1.	     INTERPRETATION AND CONSTRUCTION 

 

	1.1	 For the purposes of the Plan, the following terms shall have the meaning indicated below unless the context
clearly indicates otherwise: 

 “Award” means one of a Conditional Award, a Forfeitable Share Award or an
Option; 
 “Board” means the board of directors of the Company or a committee duly authorised by the board of directors or,
following any Corporate Action, the Board or duly authorized committee as constituted immediately prior to the Corporate Action; 

“Claw-back” means a recovery of value by the Company from a Participant in accordance with the provisions of Rule 15
(Claw-back) and Appendix 1 (Operation of Claw-back); 
 “Company” means British American Tobacco p.l.c.
(registered in England and Wales under No. 3407696); 
 “Conditional Award” means a right to receive a transfer of
Shares following vesting of the Award; 
 “Control” has the meaning given by Section 995 of the Income Tax Act 2007;

 “Corporate Action” means any of the events referred to in: 

 

	 	(A)	 Rules 9.1 to 9.5 (but excluding a Reorganisation as defined in Rule 9.8); or 

 

	 	(B)	 if the Board determines that Awards will vest pursuant to such Rule, Rule 9.6; 

“Cross-Border Merger” means a merger pursuant to the implementation in any relevant jurisdiction of Directive 2005/56/EC (on
cross-border mergers of limited liability companies); 
 “Dealing Day” means any day on which the London Stock Exchange is
open for trading; “Dealing Restriction” means any restriction on the dealing in shares, whether direct or indirect, pursuant to any law, regulation, code or enactment in England and Wales and/or the jurisdiction in which the Participant is
resident, or any share dealing code of the Company; 
 “Eligible Employee” means an employee (including an executive
director) of any Group Company; 
 “Employees’ Share Scheme” has the meaning given by Section 1166 of the
Companies Act 2006; 
 “Financial Year” means the financial year of the Company within the meaning of Section 390 of
the Companies Act 2006; 
 “Forfeitable Share Award” means a beneficial interest in Shares, legal title to which is held by
the Nominee subject to the restrictions set out in Rule 6 (Additional terms applicable to Forfeitable Share Awards) until, and which shall be transferred to the Participant following, the vesting of the Award; 

“Grant Date” means the date on which a Conditional Award or Option is granted, or the date on which the Board determines that
a Forfeitable Share Award shall be granted; 
 “Group” means the Company and any company which from time to time is a
subsidiary of the Company, within the meaning of section 1159 of the Companies Act 2006 (each a “Group Company”); 

“Market Value” means, in relation to a Share on any day, the mid-closing price of a Share on such day (as derived from the
Daily Official List of the London Stock Exchange); 
 “Nominee” means any person appointed by the Company from time to time
to hold legal title to the Shares subject to a Forfeitable Share Award on behalf of the Participant in accordance with these Rules (which may be the trustee of a Trust acting as a nominee); 

  
 3 

 British American Tobacco 2016 Long Term Incentive Plan 

 

 “Normal Vesting Date” means: 

 

	 	(A)	 subject to (B): 

  

	 	(i)	 where the Board determines that an extended vesting period shall apply, the fifth anniversary of the Grant
Date, or otherwise, 

  

	 	(ii)	 the third anniversary of the Grant Date or any later date determined by the Board; or 

 

	 	(B)	 in respect of an Award granted in respect of the recruitment of an Eligible Employee, any other date (which may
be prior to the third anniversary of the Grant Date) as determined by the Board prior to the Grant Date; 

“Option” means a right to acquire Shares, which may be exercised by the Participant following the vesting of the Award during
any period permitted for exercise; 
 “Option Price” shall be nil, or such other amount as the Board may determine (provided
that the Board may reduce or waive such amount at any time); 
 “Participant” means an Eligible Employee who has received an
Award to the extent it has not been released and has not lapsed (or, following his death, his Personal Representatives); 

“Performance Condition” means the performance condition to which an Award is subject, which may consist of one or more
performance elements, being as set out in a Schedule to the Plan (as substituted or amended by the Board from time to time); 

“Performance Period” means the period of three Financial Years beginning with the Financial Year in which the Grant Date
falls, or such other period as is determined by the Board prior to the Grant Date in accordance with Rule 5; 
 “Personal
Representatives” means, following his death, the Participant’s personal representatives, or a person fulfilling a similar function in any jurisdiction; 

“Plan” means this British American Tobacco 2016 Long Term Incentive Plan, as amended from time to time; 

“Quarter Day” means 31 March, 30 June, 30 September or 31 December; 

“Rule” means a rule of this Plan; 

“Share” means a fully paid ordinary share in the capital of the Company; 

“Treasury Shares” means Shares to which Sections 724 to 732 of the Companies Act 2006 apply; 

“Trust” means any employee benefit trust from time to time established by the Company; “U.S. Taxpayer” has the
meaning given in Rule 3.11 (U.S. Taxpayers); and 
 “vesting” means: 

 

	 	(A)	 Shares subject to a Conditional Award becoming due to be transferred to the Participant; 

 

	 	(B)	 Shares subject to a Forfeitable Share Award ceasing to be subject to the restrictions set out in Rule 6
(Additional terms applicable to Forfeitable Share Awards), and legal title to such Shares becoming due to be transferred to the Participant; or 

  

	 	(C)	 an Option becoming exercisable, (and “vest” shall be construed accordingly).

  

	1.2	 In this Plan unless the context requires otherwise: 

 

	 	1.2.1	 the headings are inserted for convenience only and do not affect the interpretation of any Rule;

  

	 	1.2.2	 a reference to a statute or statutory provision includes a reference: 

  
 4 

 British American Tobacco 2016 Long Term Incentive Plan 

 

	 	(A)	 to that statute or statutory provision as from time to time consolidated, modified, re-enacted or replaced by
any statute or statutory provision; 

  

	 	(B)	 to any repealed statute or statutory provision which it re-enacts (with or without modification); and

  

	 	(C)	 to any subordinate legislation made under it; 

 

	 	1.2.3	 words in the singular include the plural, and vice versa; 

 

	 	1.2.4	 a reference to the masculine shall be treated as a reference to the feminine and vice versa;

  

	 	1.2.5	 a reference to a person shall include a reference to a body corporate; and 

 

	 	1.2.6	 a reference to writing or written form shall include any legible format capable of being reproduced on paper,
irrespective of the medium used. 

  

	1.3	 In this Plan: 

  

	 	1.3.1	 a reference to the “transfer of Shares” (or similar) shall include both the issue and allotment of
Shares and the transfer of Treasury Shares; and 

  

	 	1.3.2	 a provision obliging, or permitting, any company to do any thing shall be read as obliging, or permitting, such
company to do that thing, or procure that thing to be done; and 

  

	 	1.3.3	 the use of the word “including” shall mean including without limitation and without prejudice to the
generality of the foregoing. 

  

	2.	 PLAN LIMITS 

  

	2.1	 Pursuant to the Plan: 

 

	 	2.1.1	 subject to Rule 2.2, the Board may not grant a Conditional Award or Option; and 

 

	 	2.1.2	 Shares may not be issued for the purpose of a Forfeitable Share Award, 

if the number of Shares subject to such proposed Award (the “Relevant Shares”) would cause either of the limits in Rules 2.3
or 2.4 to be breached. 
  

	2.2	 Rule 2.1 shall not apply in respect of a Conditional Award or Option granted on terms that it shall not be
capable of being satisfied by the issue of Shares. 

 5 per cent limit: discretionary Employees’ Share
Scheme 
  

	2.3	 The number of Relevant Shares, when added to the aggregate of: 

 

	 	2.3.1	 the number of Shares subject to outstanding options or awards granted within the previous 10 years under the
Plan or any other discretionary Employees’ Share Scheme adopted by the Company which may be satisfied by the issue of Shares; and 

  

	 	2.3.2	 the number of Shares actually issued within the previous 10 years under the Plan, under any other discretionary
Employees’ Share Scheme or to a Trust (but excluding any of those Shares that were used to satisfy an option or award granted more than 10 years previously, and without double counting any Shares which the Board has determined are to be used to
satisfy options or awards counted under Rule 2.3.1 above), 

 may not exceed such number as represents 5 per cent of
the Company’s issued share capital immediately prior to such proposed grant or issue. 

  
 5 

 British American Tobacco 2016 Long Term Incentive Plan 

 

 10 per cent limit: Employees’ Share Scheme 

 

	2.4	 The number of Relevant Shares, when added to the aggregate of: 

 

	 	2.4.1	 the number of Shares subject to outstanding options or awards granted within the previous 10 years under the
Plan or any other Employees’ Share Scheme adopted by the Company which may be satisfied by the issue of Shares; and 

  

	 	2.4.2	 the number of Shares actually issued within the previous 10 years under the Plan, under any other
Employees’ Share Scheme or to a Trust (but excluding any of those Shares: that were used to satisfy an option or award granted more than 10 years previously, and without double counting any Shares which the Board has determined are to be used
to satisfy options or awards counted under Rule 2.4.1 above), 

 may not exceed such number as represents 10 per
cent of the Company’s issued share capital immediately prior to such proposed grant or issue. 
 Treasury Shares 

 

	2.5	 References in this Rule 2 to the issue of Shares shall include the transfer of Treasury Shares, but only until
such time as the guidelines issued by institutional investor bodies cease to provide that they should be so included. 

  

	3.	 AWARDS 

  

	 	Eligibility	 

  

	3.1	 Awards may be granted to Eligible Employees selected by the Board. 

Timing of grants 
  

	3.2	 An Award may only be granted: 

 

	 	3.2.1	 during the period of 42 days commencing on the date on which the Plan is approved shareholders of the Company
in general meeting; 

  

	 	3.2.2	 during the period of 42 days commencing on the Dealing Day immediately following the day on which the Company
announces its results for the preceding financial year, half-year or other period; 

  

	 	3.2.3	 in respect of an Award to be granted in respect of the recruitment of an Eligible Employee, as soon as
reasonably practicable after the Eligible Employee commences holding office or employment with any Group Company; and/or 

  

	 	3.2.4	 at such time at which the Board determines that exceptional circumstances exist which justify the grant of the
Award, 

 or, in any such case, if the grant of Awards during such period or at such time would be contrary to any Dealing
Restriction, as soon as reasonably practicable after such restriction ceases to apply. 
 Individual limit 

 

	3.3	 An Award may not be granted to an Eligible Employee where it would cause the aggregate Relevant Value of the
Shares subject to such Award and any Award(s) granted to the Eligible Employee in the same Financial Year to exceed an amount equal to 500% of the gross annual basic salary of that Eligible Employee as at the first day of such Financial Year or, if
later, the first day of the Eligible Employee’s employment with the Group during such Financial year. 

 An Award
granted in breach of this limit shall immediately lapse in respect of the number of Shares which cause this limit to be breached. Awards which have been released or have lapsed, or which are granted in connection with the recruitment of an Eligible
Employee in 

  
 6 

 British American Tobacco 2016 Long Term Incentive Plan 

 

 
lieu of incentive awards granted by the individual’s former employer which are forfeited, and any right to receive Shares as a dividend equivalent, shall be ignored for this purpose. 

In this Rule 3.3, the “Relevant Value” of a Share subject to an Award means either (as determined by the Board): (i) the
Market Value of a Share on the Dealing Day immediately preceding the Grant Date; or (ii) the average of the Market Values of a Share over such number of Dealing Days preceding the Grant Date as the Board may determine (all being within the
period of 30 days preceding the Grant Date and, where the Award is granted within the period in Rule 3.2.2, being on or after the date of the results announcement). 
  

	3.4	 Where an Eligible Employee’s gross annual basic salary is denominated in a currency other than pounds
sterling, for the purposes of Rule 3.3 above such gross annual basic salary shall be converted into pounds sterling on such basis as the Board may reasonably determine. 

  Method of grant 
  

	3.5	 An Award shall be granted by the Board. 

 

	3.6	 A Conditional Award or an Option shall be granted by deed. 

 

	3.7	 The Company shall procure that the Shares subject to a Forfeitable Share Award shall, on or as soon as
reasonably practicable following the Grant Date, be issued to or acquired by a Nominee, and shall thereafter be held on behalf of the Participant until the date on which the Forfeitable Share Award vests or such earlier date as the Forfeitable Share
Award lapses. 

  

	3.8	 No payment for the grant of an Award shall be made by the Participant. 

 

	3.9	 A Participant may within 30 days of the Grant Date release an Award (in full but not in part) by written notice
to the Company. Where a Participant does not release an Award within such period, the Participant shall be deemed to have accepted the Award on the terms set out in the Rules. 

  Award notification 
  

	3.10	 As soon as practicable following the Grant Date the Company shall notify a Participant of the grant of an
Award. Such notification shall specify: 

  

	 	3.10.1	 whether the Award takes the form of a Conditional Award, a Forfeitable Share Award or an Option;

  

	 	3.10.2	 the Grant Date; 

  

	 	3.10.3	 the Normal Vesting Date; 

 

	 	3.10.4	 the number of Shares in respect of which the Award is granted; 

 

	 	3.10.5	 in relation to an Option, the Option Price (if any); 

 

	 	3.10.6	 the full terms of the Performance Condition and the Performance Period; 

 

	 	3.10.7	 if applicable, that the dividend equivalent provisions of Rule 11 (Dividend equivalent) shall apply; and

  

	 	3.10.8	 that the Award is subject to the claw-back provisions of Rule 15 (Claw-back) and Appendix 1
(Operation of Claw-back). 

   U.S. Taxpayers 

 

	3.11	 The provisions of Appendix 2 (Awards Granted to U.S. Taxpayers) shall apply to a Conditional Award or an
Option that is held by any Participant while he or she is subject to taxation under the U.S. Internal Revenue Code of 1986, as amended (a “U.S. Taxpayer”). References to Code §409A are to §409A of the U.S. Internal Revenue
Code of 1986, as amended. 

  
 7 

 British American Tobacco 2016 Long Term Incentive Plan 

 

	4.	 AWARDS ARE NON-TRANSFERABLE 

 

	4.1	 A Participant may not transfer, assign, pledge, charge or otherwise dispose of, or grant any form of security
or other interest over, any part of his interest in an Award. An Award shall (unless the Board determines otherwise) lapse on the Participant doing so (whether voluntarily or involuntarily), being deprived of the beneficial ownership of an Award by
operation of law, or becoming bankrupt. 

  

	4.2	 Rule 4.1 does not restrict the transmission of an Award to the Participant’s Personal Representatives
following his death. 

  

	5.	 PERFORMANCE CONDITION 

 

	5.1	 An Award shall be granted subject to the Performance Condition. 

 

	5.2	 Subject to Rule 5.3, each element of the Performance Condition shall be assessed over a period of not less than
three years, ending no later than the Normal Vesting Date. 

  

	5.3	 An Award granted in respect of the recruitment of an Eligible Employee may be granted on terms that the
Performance Condition shall be assessed over such shorter period as the Board may determine prior to the grant of the Award. 

  

	5.4	 If events happen following the Grant Date which cause the Board to determine that any element of the
Performance Condition is no longer a fair measure of the Company’s performance, the Board may alter the terms of such element as it determines to be appropriate but not so that the revised target is, in the opinion of the Board, materially less
challenging than was intended in setting the original Performance Condition. 

  

	5.5	 The Performance Condition may not be retested. 

 

	6.	 ADDITIONAL TERMS SPECIFIC TO FORFEITABLE SHARE AWARDS 

Restrictions applicable to Forfeitable Share Awards 
  

	6.1	 The Participant shall be (subject to the Award lapsing) the beneficial owner of the Shares subject to a
Forfeitable Share Award. For the avoidance of doubt, such beneficial interest shall be subject to the restriction in Rule 4.1 (Awards are non-transferable). 

 

	6.2	 Until a Forfeitable Share Award vests, the Nominee shall refuse to act on any instruction from the Participant
to (and, subject to Rule 6.3, shall not) transfer, assign, pledge, charge or otherwise dispose of, or grant any form of security or other interest over, legal title to the Shares subject to the Award or any interest therein, or enter into any
agreement or accept any offer to do any such thing. 

  

	6.3	 The Nominee shall take such action as is necessary to give effect to Rules 9.8 (Roll-over of Award), 13.1
(Tax Liability), 15 (Claw-back), 16 (Variation of capital) and Appendix 1 (Operation of Claw-back) and without further instruction from the Participant (and for the avoidance of doubt nothing in this Rule 6 shall prevent
Shares subject to a Forfeitable Share Award becoming subject to a Corporate Action pursuant to Rule 9.3 (Scheme of compromise or arrangement)). 

Voting rights on forfeitable Shares 
  

	6.4	 Unless the Board determines otherwise, the Participant shall be entitled to direct the Nominee to vote the
Shares subject to a Forfeitable Share Award, provided that the Nominee shall not be bound to seek directions from the Participant to vote and in the absence of any such direction shall not vote. 

Dividend rights on forfeitable Shares 
  

	6.5	 Unless the Board determines otherwise, the Participant shall be entitled to receive any dividends paid in
respect of Shares subject to a Forfeitable Share Award (and if the Board so determines the Nominee shall waive the right to receive any dividends in respect of such Shares). 

  
 8 

 British American Tobacco 2016 Long Term Incentive Plan 

 

 Lapse of Forfeitable Share Award 

 

	6.6	 Where a Forfeitable Share Award lapses, the Participant shall cease to be beneficially entitled to the Shares
subject to the Award, and the beneficial interest in such Shares shall, unless the Board directs otherwise, revert to a Trust specified by the Board for nil or nominal consideration. 

 

	7.	 VESTING 

Normal vesting 
  

	7.1	 An Award shall vest on the Normal Vesting Date. 

Vesting subject to Dealing Restrictions 
  

	7.2	 A Conditional Award or a Forfeitable Share Award shall not vest unless, and vesting shall be delayed until, the
Board is satisfied that at that time: 

  

	 	7.2.1	 such vesting; 

  

	 	7.2.2	 the transfer of Shares to the Participant and the sale of Shares pursuant to Rule 13 (Tax Liability);
and 

  

	 	7.2.3	 any action needed to be taken by the Company to give effect to such vesting is not contrary to any Dealing
Restriction. 

 Extent of vesting determined by the Performance Condition 

 

	7.3	 The extent to which an Award shall be capable of vesting (if at all) shall be determined by reference to the
Performance Condition. At the end of the period over which the Performance Condition is assessed, the Award shall lapse to the extent that the Performance Condition is not met. 

 

	7.4	 Where an Award vests (pursuant to Rule 7.7 (International Transfers), Rule 8 (Cessation of office or
employment) or 9 (Corporate Actions)) prior to the end of the period over which any element of the Performance Condition is assessed, such element shall be assessed based on performance to the last Quarter Day prior to the date on which
the Award vests using such information (not limited to published accounts) as the Board shall determine. 

 Effect of
vesting 
  

	7.5	 The effect of the vesting of an Award is that: 

 

	 	7.5.1	 the Shares in respect of which a Conditional Award vests shall be transferred to the Participant as soon as is
reasonably practicable (which may include transferring the Shares on more than one consecutive Dealing Day on such basis as the Board may determine); 

  

	 	7.5.2	 the Shares in respect of which a Forfeitable Share Award vests shall cease to be subject to the restrictions
set out in Rule 6 (Additional terms applicable to Forfeitable Share Awards), and legal title to such Shares shall be transferred to the Participant as soon as is reasonably practicable; and 

 

	 	7.5.3	 an Option shall, to the extent that it vests, become exercisable in accordance with Rule 10 (Options).

  

	7.5A	 Shares shall not cease to be subject to the restrictions set out in Rule 6 (Additional terms applicable to
Forfeitable Share Awards) until such time as it is practicable for a number of Shares in respect of such vesting to be sold in accordance with Rule 13.1.1 (Tax Liability) (such that a proportion of such Shares may cease to be subject to
such restrictions on each Dealing Day within a period of consecutive Dealing Days (and on such basis) as the Board may determine), unless the Participant has in advance made other arrangements to

  
 9 

 British American Tobacco 2016 Long Term Incentive Plan 

 

	 	
pay the amount of the Tax Liability arising in respect of such vesting to the Company or the Board determines otherwise. 

Disciplinary proceedings 
  

	7.6	 Unless the Board determines otherwise, an Award shall not vest while a Participant is subject to an
investigation process and/or formal disciplinary process (or similar), or where a Participant has been served with notice that such a process may be instigated without such notice having been rescinded, and vesting shall (subject to the Award
lapsing to any extent prior to or as a result of the conclusion of such process pursuant to Rule 8 (Cessation of office or employment) or 15 (Claw-back)) be delayed until the conclusion of such process. 

International transfers 
  

	7.7	 Where a Participant, whilst continuing to hold an office or employment with a Group Company, is to be
transferred to work in another country, and as a result the Board considers that following such transfer either he or a Group Company is likely to suffer a tax disadvantage in respect of an Award or, due to securities or exchange control laws, the
Participant is likely to be restricted in his ability to receive Shares pursuant to an Award, to exercise an Option and/or to hold or deal in Shares, the Board may decide that an Award shall vest on such date as it may determine, in which case:

  

	 	7.7.1	 the proportion of the Award which may vest shall be limited (unless the Board determines otherwise) to a pro
rata proportion on the basis of the number of months (rounded up to the nearest whole month) which have elapsed from the first day of the Performance Period to such vesting date, as compared to the number of whole months within the Performance
Period. Any remainder of the Award shall lapse; and 

  

	 	7.7.2	 an Option may be exercised during such period as may be determined by the Board ending no later than the date
on which the Participant’s transfer takes effect. 

  

	8.	 CESSATION OF OFFICE OR EMPLOYMENT 

Cessation where Awards lapse 
  

	8.1	 An Award shall lapse: 

 

	 	8.1.1	 on the Participant ceasing to hold office or employment with any Group Company; or 

 

	 	8.1.2	 if the Participant gives or receives notice of such cessation, on such earlier date as may be determined by the
Board, save in each case where Rule 8.2 or Rule 8.6 applies. 

 Reasons for cessation where Awards remain capable of
vesting 
  

	8.2	 An Award shall not lapse pursuant to Rule 8.1 where the reason for the cessation or notice is:

  

	 	8.2.1	 disability, ill-health or injury (as evidenced to the satisfaction of the Board); 

 

	 	8.2.2	 redundancy (within the meaning of the Employment Rights Act 1996); 

 

	 	8.2.3	 the transfer of the Participant’s employment in connection with the disposal of a business or undertaking,
or a part- business or part- undertaking; 

  

	 	8.2.4	 the company with which the Participant holds office or employment ceasing to be a Group Company; or

  

	 	8.2.5	 any other reason, if the Board so determines. 

  
 10 

 British American Tobacco 2016 Long Term Incentive Plan 

 

 Where the Board exercises its discretion under Rule 8.2.5 the Board may impose additional
conditions on the Award (including as to when the Award may vest). 
 Cessation prior to the Normal Vesting Date 

 

	8.3	 Where prior to the Normal Vesting Date a Participant ceases to hold office or employment with any Group Company
for any of the reasons specified in Rule 8.2: 

  

	 	8.3.1	 an Award shall not vest at the date of such cessation, but shall continue to be capable of vesting (in which
case an Option may be exercised during the period of six months, or such other period as may be determined by the Board, from such date on which the Award may vest, and shall lapse at the expiry of such period); or 

 

	 	8.3.2	 the Board may determine that the Award shall instead vest on or at any time following the date of cessation (in
which case an Option may be exercised during the period of six months, or such other period as may be determined by the Board, from such vesting date, and shall lapse at the expiry of such period). 

For the avoidance of doubt, the Board may make the determination in Rule 8.3.2 on a standing basis (subject to revocation of such determination
at any time) in respect of all Awards to be granted to a specified Eligible Employee or Eligible Employees. 
  

	8.4	 Where prior to the Normal Vesting Date a Participant ceases to hold office or employment with any Group Company
for any of the reasons specified in Rule 8.2, unless the Board determines otherwise: 

  

	 	8.4.1	 if the date of such cessation falls within the first six months of the Performance Period, the Award shall
lapse in full on the date of such cessation; or 

  

	 	8.4.2	 where Rule 8.4.1 does not apply, the proportion of the Award which may vest (under any Rule) shall be limited
to a pro rata proportion on the basis of the number of months (rounded up to the nearest whole month) which have elapsed from the first day of the Performance Period to the date of cessation, as compared to the number of whole months within the
Performance Period. Any remainder of the Award shall lapse. 

 Exercise period in the event of cessation on or after the
Normal Vesting Date 
  

	8.5	 Where on or after the Normal Vesting Date a Participant ceases to hold office or employment with any Group
Company for any of the reasons specified in Rule 8.2, an Option shall lapse at the expiry of the period of six months, or such other period as may be determined by the Board, from the date of cessation. 

Death 
  

	8.6	 An Award shall vest on the Participant’s death. An Option may be exercised (by the Participant’s
Personal Representatives) during a period of one year from the date of the Participant’s death and shall lapse at the expiry of such period. Where a Participant dies during an exercise period pursuant to either Rule 8.3 or 8.5 an Option shall
not lapse as a result of such Rule until the expiry of the twelve month period in this Rule 8.6. 

 Cessation following
a Corporate Action 
  

	8.7	 Where a Participant ceases to hold office or employment with any Group Company following a Corporate Action
within the relevant exercise period referred to in Rule 9 (Corporate Actions), an Option shall not lapse pursuant to this Rule 8 until the expiry of the relevant exercise period in Rule 9 (Corporate Actions). This Rule 8.7 shall not
apply where the cessation is by way of (or occurs where there are circumstances which the Board determines would have justified) summary dismissal or service of notice of termination of office or employment on the grounds of misconduct.

  
 11 

 British American Tobacco 2016 Long Term Incentive Plan 

 

 Meaning of cessation of office or employment 

 

	8.8	 No provision of this Rule 8 shall apply in respect of any cessation of office or employment if immediately
following the cessation the Participant holds an office or employment with any Group Company, or in respect of any notice of cessation if arrangements are in place that mean immediately following the notice becoming effective the Participant will
hold an office or employment with any Group Company. 

  

	9.	 CORPORATE ACTIONS 

General offers 
  

	9.1	 Awards shall vest: 

 

	 	9.1.1	 upon a person obtaining Control of the Company as a result of making a general offer to acquire Shares;

  

	 	9.1.2	 upon a person, having obtained Control of the Company, making a general offer to acquire Shares; or

  

	 	9.1.3	 if a person makes a general offer to acquire Shares that would result in that person obtaining Control of the
Company and the Board so determines, on the date which the Board determines to be the last practicable date prior to the date on which it expects such person to obtain Control of the Company, 

in each case being a general offer to acquire all of the Shares (other than Shares held by the person making the offer and any person connected
to that person). 
 Options may be exercised during the period of six months from the date of any such event (but if not exercised, Options
shall not lapse at the expiry of such period). 
 Compulsory acquisition 

 

	9.2	 Awards shall vest upon a person becoming entitled to acquire Shares under Sections 979 to 982 of the Companies
Act 2006. 

 Options may be exercised during a period of one month from the date on which that person first becomes so
entitled, and shall lapse at the expiry of such period. 
 Scheme of compromise or arrangement 

 

	9.3	 Awards shall vest upon a Court sanctioning a compromise or arrangement which, on becoming effective, would
result in: 

  

	 	9.3.1	 any person obtaining Control of the Company; 

 

	 	9.3.2	 the undertaking, property and liabilities of the Company being transferred to another existing or new company;
or 

  

	 	9.3.3	 the undertaking, property and liabilities of the Company being divided among and transferred to two or more
companies, whether existing or new. 

 Options may be exercised during a period of six months from the date of a Court
sanctioning such a compromise or arrangement (or, if earlier, to the day prior to the date on which a transfer as described in Rule 9.3.2 or Rule 9.3.3 is to become effective), and shall lapse at the expiry of such period. 

Merger 
  

	9.4	 Awards shall vest upon a competent authority approving a Cross-Border Merger, pursuant to which the Company
shall cease to exist. 

 Options may be exercised during the period from the date of a competent authority approving a
Cross-Border Merger until the day prior to the date on which the Cross-Border Merger is to become effective, and shall lapse at the expiry of such period. 

  
 12 

 British American Tobacco 2016 Long Term Incentive Plan 

 

 Voluntary winding-up 

 

	9.5	 Awards shall vest in the event of a notice being given of a resolution for the voluntary winding-up of the
Company. 

 Options may be exercised during a period of two months from the date of such a notice being given and shall
lapse at the expiry of such period. 
 Demerger or special dividend 

 

	9.6	 If the Board so determines, Awards may vest following the announcement of a demerger of a substantial part of
the Group’s business, a special dividend or a similar event affecting the value of Shares to a material extent on such date specified by the Board. Where the Board makes such determination, Options may be exercised during a period of two months
(or such other period as the Board may determine) from the date specified by the Board and, unless the Board determines otherwise, shall lapse at the expiry of such period. 

Extent of vesting on a Corporate Action 
  

	9.7	 Where an Award vests (and, in the case of an Option, is exercised) pursuant to any of Rules 9.1 to 9.6, the
proportion of the Award which may vest shall be limited (unless the Board determines otherwise) to a pro rata proportion on the basis of the number of months (rounded up to the nearest whole month) which have elapsed from the first day of the
Performance Period to the date of the Corporate Action, as compared to the number of whole months within the Performance Period. Any remainder of the Award shall lapse. 

Roll-over of Award on a Reorganisation or takeover 
  

	9.8	 Unless the Board determines otherwise, an Award shall not vest pursuant to this Rule 9 if, as a result of any
event that would otherwise be a Corporate Action, a company will obtain Control of the Company or will obtain substantially all of the assets of the Company (the “Acquiring Company”), and either: 

 

	 	9.8.1	 the Acquiring Company will immediately following such event have (either directly or indirectly) substantially
the same shareholders and approximate shareholdings as those of the Company prior to such event (a “Reorganisation”); or 

  

	 	9.8.2	 the Board, with the agreement of the Acquiring Company, determines that the Award shall not vest as a result of
such event and so notifies the Participant prior to the occurrence of the date on which the Award would otherwise vest. 

In such case: 
  

	 	9.8.3	 the existing Option or Conditional Award (the “Old Award”) shall lapse on the occurrence of the
relevant event, provided that the New Parent Company shall grant a replacement right to receive shares (the “New Award”) over such number of shares in the New Parent Company which are of equivalent value to the number of Shares in respect
of which the Old Award was outstanding. The New Award shall be granted on the terms of the Plan, but as if the New Award had been granted at the same time as the Old Award and shall continue to be subject to the Performance Condition (but subject to
Rule 5.4 (Performance Condition)); 

  

	 	9.8.4	 where the event is an event specified in Rule 9.1.1 or Rule 9.1.2 (notwithstanding that the Award shall not
vest pursuant to such Rule) the Nominee shall action the acceptance of the general offer in respect of the Shares subject to the Forfeitable Share Award; and/or 

 

	 	9.8.5	 the proceeds from the relevant event received by the Nominee in respect of the Shares subject to the
Forfeitable Share Award, whether in cash or securities (and the Nominee shall accept, on behalf of the Participant, any offer of securities in preference to the receipt of cash), shall continue to be held on behalf of the Participant subject to the
terms of the Plan, provided that a proportion of such proceeds as is of equal value to the amount of any Tax Liability arising in respect 

  
 13 

 British American Tobacco 2016 Long Term Incentive Plan 

 

	 	
of the Award at such time shall vest and shall be dealt with in accordance with Rule 13.1.1 (Tax Liability) (and references in the Plan to the Shares subject to the Forfeitable Share Award shall
be read as being to the proceeds that continue to be held on behalf of the Participant). 

 For the purposes of this Rule 9.8:

  

	 	9.8.6	 the “New Parent Company” shall be the Acquiring Company, or, if different the company that is the
ultimate parent company of the Acquiring Company within the meaning of section 1159 of the Companies Act 2006; and 

  

	 	9.8.7	 the terms of the Plan shall following the date of the relevant event be construed as if: 

 

	 	(A)	 the reference to “British American Tobacco p.l.c.” in the definition of “Company” in Rule 1
(Interpretation and construction) were a reference to the company which is the New Parent Company, and 

  

	 	(B)	 save where the New Parent Company is listed, Rule 18.2 (Amendments) were omitted. 

Compulsory winding-up 
  

	9.9	 An Award shall lapse on the passing of an effective resolution, or the making of a Court order, for the
compulsory winding-up of the Company. 

 Concert parties 

 

	9.10	 For the purposes of this Rule 9, a person shall be deemed to have Control of the Company where he and any
others acting in concert with him together have Control of the Company. 

  

	10.	 OPTIONS 

  

	10.1	 An Option may be exercised, in full or in any number of parts, by the delivery to the Company (or such other
person nominated by the Company) of a valid notice of exercise in such form as the Board may prescribe together with payment of the Option Price for the Shares in respect of which the Option is exercised (if any). 

 

	10.2	 An Option shall lapse on the tenth anniversary of the Grant Date (or such earlier date as the Board may
determine prior to the Grant Date). 

  

	10.3	 Any Shares in respect of which the Option is exercised shall be transferred to the Participant as soon as
reasonably practicable (which may include transferring the Shares on more than one consecutive Dealing Days on such basis as the Board may determine). 

  

	10.4	 An Option may not be exercised unless the Board is satisfied that at such time: 

 

	 	10.4.1	 such exercise, 

  

	 	10.4.2	 the transfer of Shares to the Participant and the sale of Shares pursuant to Rule 13; and

  

	 	10.4.3	 any action needed to be taken by the Company to give effect to such exercise, 

is not contrary to any Dealing Restriction. Where the exercise, transfer or dealing in Shares is contrary to any Dealing Restriction on the
last Dealing Day in any of the periods referred to in Rules 8.3, 8.5 or 8.6 (Rule 8 being in relation to cessation of office or employment) or Rules 9.1 to 9.3 or 9.6 (Rule 9 being in relation to Corporate Actions), such period shall
be extended to the end of the first Dealing Day thereafter on which the Board is satisfied that the exercise, transfer and dealing in Shares is not contrary to any Dealing Restriction. 

 

	10.5	 An Option shall lapse on the earliest date provided under any Rule (save only as expressly provided in Rules
8.6 (Death) and 8.7 (Cessation following a Corporate Action)). 

  
 14 

 British American Tobacco 2016 Long Term Incentive Plan 

 

	11.	 DIVIDEND EQUIVALENT 

 

	11.1	 If at any time prior to the Normal Vesting Date the Board so determines, on or following the date on which an
Award vests the Company may: 

  

	 	11.1.1	 make a cash payment to the Participant equal to the amount of any dividends that the Participant would have
received in respect of the number of Shares in respect of which the Award vests had the Participant been the full legal and beneficial owner of such Shares during the period from the Grant Date to the date the Award vests; or 

 

	 	11.1.2	 transfer to the Participant such number of additional Shares as have an aggregate Market Value on the date on
which the Award vests equal to the amount determined in accordance with Rule 11.1.1 above. 

  

	11.2	 A cash payment under Rule 11.1 may be made in a currency other than pounds sterling, in which case the amount
of such payment shall be converted into such other currency on such basis as is determined by the Board. 

  

	11.3	 Rule 11.1 shall not apply in respect of a Forfeitable Share Award unless the Board determines pursuant to Rule
6.5 (Dividend rights on forfeitable Shares) that the Participant shall not be entitled to receive dividends paid in respect of the Shares subject to the Forfeitable Share Award. 

 

	12.	 CASH ALTERNATIVE – OPTIONS AND CONDITIONAL AWARDS 

 

	12.1	 This Rule 12 shall not apply in respect of any Award granted to a Participant resident in any jurisdiction
where the grant of an Award which provides for a cash alternative would be unlawful, fall outside any applicable exemption under securities, exchange control or similar regulations, or would cause adverse tax or social security (or similar)
contribution consequences for the Company or the Participant (in each case as determined by the Board) or where the Board determines prior to the Grant Date that this Rule 12 shall not apply. 

 

	12.2	 The Board may determine prior to the Grant Date that a Conditional Award or Option shall only be satisfied in
cash, in which case the Award shall not be a right to acquire Shares, and the vesting of the Conditional Award or exercise of the Option shall be satisfied in full by the payment of a cash equivalent amount, in substitution for the transfer of
Shares. 

  

	12.3	 Where the Board has made no determination pursuant to Rule 12.1 or 12.2 in respect of any Conditional Award or
Option, the Board may determine at any time prior to the transfer of Shares pursuant to such Award that the vesting of the Conditional Award or the exercise of the Option (or a part thereof) shall be satisfied by the payment of a cash equivalent
amount, in substitution for the transfer of Shares. 

  

	12.4	 A “cash equivalent amount” shall be calculated as the number of Shares which would otherwise
be transferred in respect of the relevant vesting or exercise but which are being substituted for the cash equivalent amount, multiplied by an amount equal to the relevant value less, in the case of an Option, the Option Price (if any), where the
“relevant value” is the Market Value of a Share on the date on which the Award vests or, in the case of an Option, is exercised (or, in either case, where only a part of the Award is to be satisfied with payment of a cash equivalent
amount, is the Market Value of a Share on the date on which Shares are transferred to the Participant pursuant to the Award)). 

  

	 	12.5	 A cash equivalent amount shall be paid as soon as reasonably practicable following the relevant vesting or
exercise. 

  

	 	12.6	 A cash equivalent amount may be paid in a currency other than pounds sterling, in which case the cash
equivalent amount shall be converted into such other currency on such basis as is determined by the Board. 

  
 15 

 British American Tobacco 2016 Long Term Incentive Plan 

 

	13.	 TAX LIABILITY 

 

	13.1	 When any Tax Liability arises in respect of an Award, the Participant authorises any Group Company:

  

	 	13.1.1	 to retain and sell legal title to such number of the Shares which would otherwise have been transferred to the
Participant on vesting or exercise of the Award, or any part thereof, (notwithstanding that beneficial title shall pass) as may be sold for aggregate proceeds equal to the Group Company’s estimate of the amount of the Tax Liability;

  

	 	13.1.2	 to deduct an amount equal to the Group Company’s estimate of the Tax Liability from any cash payment made
under the Plan; and/or 

  

	 	13.1.3	 where the amount realised under Rule 13.1.1 or deducted under Rule 13.1.2 is insufficient to cover the full
amount of the Tax Liability, to deduct any further amount as is necessary through payroll, 

 and in each case to apply
such amount in paying the amount of the Tax Liability to the relevant revenue authority or in reimbursing the relevant Group Company for any such payment, provided that, where the amount realised under Rule 13.1.1 or deducted under Rule 13.1.2 is
greater than the actual Tax Liability, the Group Company shall repay the excess to the Participant as soon as reasonably practicable. 
 The
Group Company shall be entitled to make the estimates referred to in this Rule 13.1 on the basis of the highest rates of tax and/or social security applicable at the relevant time in the jurisdiction in which the Group Company is liable to account
for the Tax Liability, notwithstanding that the Tax Liability may not arise at such rates. 
  

	13.2	 “Tax Liability” shall mean any amount of tax and/or social security (or similar) contributions
which any Group Company becomes liable to pay on behalf of the Participant to the revenue authorities in any jurisdiction, together with all or such proportion (if any) of employer’s social security contributions which would otherwise be
payable by any Group Company as is determined to be recoverable from the Participant (to the extent permitted by law) by the Board, or which the Participant has agreed to pay or which are subject to recovery pursuant to an election to which
paragraph 3B of Schedule 1 to the Social Security Contributions and Benefits Act 1992 applies. 

  

	14.	 VESTED SHARE ACCOUNTS 

 

	14.1	 Legal title to any Shares which are due to be transferred to the Participant pursuant to the Plan may be
transferred to a person (the “Vested Share Account Provider”) appointed by the Company from time to time to hold legal title to such Shares on behalf of the Participant. 

 

	14.2	 The Vested Share Account Provider shall receive and hold Shares on behalf of the Participant in accordance with
such terms and conditions as are agreed by the Company from time to time, and by participating in the Plan the Participant irrevocably agrees to those terms and conditions (which shall be available to the Participant on request to the Company).

  

	14.3	 The transfer of any Shares to the Vested Share Account Provider shall satisfy any obligation of the Company
under the Plan to transfer Shares to the Participant (and references in the Plan to Shares (or legal title thereof) having been transferred to the Participant shall be read accordingly). 

 

	14.4	 The terms and conditions referred to in Rule 14.2 above may include terms that the Participant shall not be
entitled to transfer, assign, pledge, charge or otherwise dispose of, or grant any form of security or other interest over, some or all of the Shares if to do so would be in breach of the Participant’s obligations under the Company’s
shareholding requirements as they apply to such Participant. 

  
 16 

 British American Tobacco 2016 Long Term Incentive Plan 

 

	15.	 CLAW-BACK 

Claw-back events 
  

	15.1	 The Board may at any time prior to the fifth anniversary of the Grant Date of an Award determine that a
Claw-back shall apply in respect of the Award, if the Board determines that: 

  

	 	15.1.1	 there has been a material misrepresentation in relation to the performance of any Group Company, relevant
business unit and/or the Participant on the basis of which the extent to which the Award will be capable of vesting, or vested, was determined (which may include, but shall not be limited to: (i) a misstatement of the financial results and/or
health of any Group Company; (ii) an erroneous calculation in relation to any Group Company’s results or other performance benchmark; (iii) errors in any Group Company’s financial statements; or (iv) discrepancies in the
financial accounts, and, for the avoidance of doubt, notwithstanding that such misrepresentation may not arise from fraud or reckless behaviour); or 

  

	 	15.1.2	 an erroneous calculation was made in assessing the extent to which the Award is to be capable of vesting, or
vested, 

 and, in either case, the Award is capable of vesting, or vested, in respect of a greater number of Shares
than would have been the case had there not been such a misrepresentation or had such error not been made. 
  

	15.2	 The Board may at any time (whether before or after vesting) determine that a Claw-back shall apply in respect
of an Award where the Participant is found to have committed at any time prior to the vesting of the Award, including prior to grant, an act or omission which justifies, or in the opinion of the Board would have justified, summary dismissal or
service of notice of termination of office or employment on the grounds of misconduct. 

 Applying Claw-back 

 

	15.3	 A Claw-back shall be applied in accordance with the provisions of Appendix 1 (Operation of Claw-back).

 Lapse of Awards to give effect to claw-back of other awards 

 

	15.4	 By participating in the Plan, the Participant acknowledges that the Board may lapse any Award to such extent as
it determines to be necessary (including in full) in order to give effect to a claw-back under the terms of the Plan or any other Employees’ Share Scheme or bonus scheme operated from time to time by any Group Company. 

No Claw-back following Corporate Action 
  

	15.5	 No Claw-back shall be capable of being applied at any time following any Corporate Action, save where the
determination that the Claw-back shall apply was made prior to such event (and, for the avoidance of doubt, a Corporate Action does not include a Reorganisation). 

 

	16.	 VARIATION OF CAPITAL 

 

	16.1	 If in respect of Shares subject to a Forfeitable Share Award the Nominee receives on behalf of a Participant
any rights to acquire securities, the Nominee shall sell such rights nil paid to the extent necessary to take up the remaining rights. 

  

	16.2	 In the event of any variation of the share capital of the Company, or in the event of the demerger of a
substantial part of the Group’s business, a special dividend or similar event affecting the value of Shares to a material extent (which shall not include the payment of any ordinary dividend): 

16.2.1 the Board may make such adjustments to Conditional Awards and Options as it may determine to be appropriate; and 

  
 17 

 British American Tobacco 2016 Long Term Incentive Plan 

 

	 	16.2.2	 any proceeds from such an event received by a Nominee in respect of any Shares subject to a Forfeitable Share
Award, whether in cash or securities, (including where the Nominee takes up rights pursuant to Rule 16.1) shall be held by the Nominee on the same terms as the Forfeitable Share Award to which they relate, and references to the Shares subject to a
Forfeitable Share Award shall be read to include such proceeds. 

  

	16.3	 For the avoidance of doubt Rule 16.2 shall not apply in respect of any Awards pursuant to which legal title to
Shares has been transferred prior to the date of the relevant event (such that the recipient of such legal title shall participate in such event as a holder of Shares) including pursuant to the vesting of an Award under Rule 9.6 (Demerger or
special dividend). 

  

	17.	 ADMINISTRATION 

 

	17.1	 Any notice or other communication under or in connection with this Plan may be given by the Company (or its
agents) to a Participant personally, by email or by post, or by a Participant to the Company or any Group Company either personally or by post to the Secretary of the Company. Items sent by post shall be pre-paid and shall be deemed to have been
received 48 hours after posting. Items sent by email shall be deemed to have been received immediately. 

  

	17.2	 A Participant shall not be entitled to: 

 

	 	17.2.1	 receive copies of accounts or notices sent to holders of Shares; 

 

	 	17.2.2	 subject to Rule 6.4 (Voting rights on forfeitable Shares) in respect of a Forfeitable Share Award,
exercise voting rights; or 

  

	 	17.2.3	 subject to Rule 6.5 (Dividends rights on forfeitable Shares) in respect of a Forfeitable Share Award,
receive dividends, in respect of Shares subject to an Award legal title to which has not been transferred to the Participant. 

  

	17.3	 Any discretion (including the power to make any determination) of the Board under or in connection with the
Plan may be exercised by the Board in its absolute discretion. 

  

	17.4	 Any exercise of discretion (including the making of any determination) by the Board under or in connection with
the Plan shall be final and binding. 

  

	17.5	 Any disputes regarding the interpretation of the Rules or the terms of any Award shall be determined by the
Board (upon such advice as the Board determines to be necessary) and any decision in relation thereto shall be final and binding. 

  

	18.	 AMENDMENTS 

  

	18.1	 Subject to Rules 18.2 and 18.4, the Board may at any time add to or alter the Plan or any Award made thereunder
in any respect. 

  

	18.2	 Subject to Rule 18.3, no addition or alteration to the advantage of present or future Participants relating to
eligibility, the limits on participation, the overall limits on the issue of Shares or the transfer of Treasury Shares, the basis for determining a Participant’s entitlement to, or the terms of, Shares or cash provided pursuant to the Plan and
the provisions for adjustments on a variation of share capital shall be made without the prior approval by ordinary resolution of the shareholders of the Company in general meeting. 

 

	18.3	 Rule 18.2 shall not apply to any alteration to or substitution of the Performance Condition or to any
alteration or addition which is necessary or desirable in order to comply with or take account of the provisions of any proposed or existing legislation, law or other regulatory requirements or to take advantage of any changes in legislation, law or
other regulatory requirements, or to obtain or maintain favourable taxation, exchange control or regulatory treatment of any Group Company or any Participant or to make minor amendments to benefit the administration of the Plan.

  
 18 

 British American Tobacco 2016 Long Term Incentive Plan 

 

	18.4	 No alteration or addition shall be made under Rule 18.1 which would abrogate or adversely affect the subsisting
rights of a Participant unless it is made: 

  

	 	18.4.1	 with the consent in writing of the Participant; 

 

	 	18.4.2	 with the consent in writing of such number of Participants as hold Awards under the Plan in relation to
75 per cent. of the Shares subject to all Awards under the Plan; or 

  

	 	18.4.3	 by a resolution at a meeting of Participants passed by not less than 75 per cent. of the Participants who
attend and vote either in person or by proxy, 

 and for the purpose of Rule 18.4.2 or 18.4.3 the Participants shall be
treated as the holders of a separate class of share capital and the provisions of the Articles of Association of the Company relating to class meetings shall apply mutatis mutandis. 

 

	18.5	 The Board may, in respect of Eligible Employees who are or who may become subject to taxation outside the
United Kingdom on their remuneration, establish such plans or sub-plans based on the Plan but subject to such modifications as the Board determines to be necessary or desirable to take account of or to mitigate or to comply with relevant overseas
taxation, securities or exchange control laws, provided that the terms of awards made under such plans or sub-plans are not overall more favourable than the terms of Awards made under the Plan and provided that awards made, and Shares issued,
pursuant to such plans or sub-plans shall count towards the limits set out in Rules 2 (Plan limits) and 3.3 (Individual limit). 

  

	19.	 DATA PROTECTION 

 

	19.1	 From time to time the personal data of the Participant will be collected, used, stored, transferred and
otherwise processed for the purposes described in Rule 19.2 and 19.3. The legal grounds for this processing will (depending on the nature and purpose of any specific instance of processing) be one of: (i) such processing being necessary for the
purposes of the legitimate interests of the Company and each other Group Company in incentivising their officers and employees and operating the Plan; (ii) such processing being necessary for the purposes of any relevant data controller in
respect of such personal data complying with its legal obligations; and (iii) such processing being necessary for the performance of the contractual obligations arising under the Plan. The collection and processing of such personal data for
such purposes is a contractual requirement of participation in the Plan. 

  

	19.2	 The purposes for which personal data shall be processed as referred to in this Rule 19 shall be in order to
allow the Company and any other relevant Group Companies to incentivise their officers and employees and to operate the Plan and to fulfil its or their obligations to the Participant under the Plan, and for other purposes relating to or which may
become related to the Participant’s office or employment, the operation of the Plan or the business of the Group or to comply with legal obligations. Such processing will principally be for, but will not be limited to, personnel,
administrative, financial, regulatory or payroll purposes as well as for the purposes of introducing and administering the Plan. 

  

	19.3	 The personal data to be processed as referred to in this Rule 19 may be disclosed or transferred to, and/or
processed by: 

  

	 	19.3.1	 any professional advisors of any Group Company, HM Revenue & Customs or any other revenue, regulatory
or governmental authorities; 

  

	 	19.3.2	 a trustee of a Trust; any registrars, brokers, payroll provider or appointed in connection with any employee
share or incentive plans operated by any Group Company; or any person appointed (whether by the Participant or any Group Company) to act as nominee on behalf of (or provide a similar service to) the Participant; 

 

	 	19.3.3	 subject to appropriate confidentiality undertakings), any prospective purchasers of, and/or any person who
obtains control of or acquires, the Company or the whole or part of the business of the Group; or 

  
 19 

 British American Tobacco 2016 Long Term Incentive Plan 

 

	 	19.3.4	 any Group Company and officers, employees or agents of such Group Company. 

 

	19.4	 Further information in relation to the processing of personal data referred to in this Rule 19, including the
details and identity of the data controller and of the Participant’s rights in respect of such personal data, is available in the Employee Data Protection Policy (or otherwise on request to the Company Secretary). 

 

	19.5	 To the extent that the processing of personal data of a Participant referred to in this Rule 19 is subject to
the laws or regulations of any jurisdiction that is not an EU member state and under which the legal grounds for processing described in Rule 19.1 do not provide a sufficient legal basis under such other laws or regulations for the processing
referred to in Rule 19.1 to 19.3, by such processing for the purposes of such other laws or regulations (but shall not be deemed to consent to such processing for the purposes of EU Regulation 2016/679). 

 

	19.6	 In this Rule19, “personal data” and “data controller” each have the meaning given in EU
Regulation 2016/679 and “Employee Data Protection Policy” means such privacy policy or similar operated by any Group Company in relation to the processing of personal data as amended from time to time and as is applicable to the
Participant. 

  

	20.	 GENERAL 

  

	20.1	 In the event of any discrepancy between these Rules in English and (i) any copy of these Rules translated
into any other language; or (ii) any communications, notices or materials issued in connection with this Plan, these Rules in English shall prevail. 

  

	20.2	 The Plan shall terminate on the 10th anniversary of the approval of the Plan by the shareholders of the Company
in general meeting, or at any earlier time by resolution of the Board or an ordinary resolution of the shareholders in general meeting. Such termination shall be without prejudice to the subsisting rights of Participants. 

 

	20.3	 Save as otherwise provided under the Plan: 

 

	 	20.3.1	 Shares issued and allotted pursuant to the Plan will rank pari passu in all respects with the Shares then in
issue at the date of such allotment, except that they will not rank for any rights attaching to Shares by reference to a record date preceding the date of allotment; and 

 

	 	20.3.2	 Shares to be transferred pursuant to the Plan will be transferred free of all liens, charges and encumbrances
and together with all rights attaching thereto, except they will not rank for any rights attaching to Shares by reference to a record date preceding the date of transfer. 

 

	20.4	 If and so long as the Shares are admitted to listing and/or for trading on any stock exchange or market, the
Company shall apply for any Shares issued and allotted pursuant to the Plan to be so admitted as soon as practicable. 

  

	20.5	 Any transfer of Shares under the Plan is subject to such consent, if any, of any authorities in any
jurisdiction as may be required, and the Participant shall be responsible for complying with the requirements to obtain or obviate the necessity for such consents. 

 

	20.6	 The terms of any individual’s office or employment with any past or present Group Company, and the rights
and obligations of the individual thereunder, shall not be affected by his participation in the Plan and the Plan shall not form part of any contract of employment between the individual and any such company. 

 

	20.7	 An Eligible Employee shall have no right to receive an Award under the Plan and participation in the Plan and
the grant of any Award is at the discretion of the Company. 

  

	20.8	 Participation in the Plan by, or the grant of any Award under it to, a Participant in any year does not create
any right to or expectation of participation in the Plan or the grant of any Award in any future year, even if the Participant has previously participated in the Plan (or any similar plan) over a long period of time and/or if participation in the
Plan and/or an Award under it (or any similar plan) has been granted (including repeatedly) without the relevant Group Company specifically expressing the voluntary and discretionary nature at the time of each such participation or Award.

  
 20 

 British American Tobacco 2016 Long Term Incentive Plan 

 

	20.9	 By participating in the Plan, the Participant waives all and any rights to compensation or damages in
consequence of the termination of his office or employment with any past or present Group Company for any reason whatsoever, whether lawfully or otherwise, insofar as those rights arise or may arise from his ceasing to have rights under the Plan
(including ceasing to be entitled to exercise any Option) as a result of such termination, or from the loss or diminution in value of such rights or entitlements, including by reason of the operation of the terms of the Plan, any determination by
the Board pursuant to a discretion contained in the Plan or the provisions of any statute or law relating to taxation. 

  

	20.10	 Benefits under the Plan shall not form part of a Participant’s remuneration for any purpose and shall not
be pensionable. 

  

	20.11	 The invalidity or non-enforceability of any provision or Rule of the Plan shall not affect the validity or
enforceability of the remaining provisions and Rules of the Plan which shall continue in full force and effect. 

  

	20.12	 These Rules shall be governed by and construed in accordance with English Law. 

 

	20.13	 The English courts shall have exclusive jurisdiction to determine any dispute which may arise out of, or in
connection with, the Plan. 

  
 21 

 British American Tobacco 2016 Long Term Incentive Plan 

 

 APPENDIX 1: OPERATION OF CLAW-BACK 

Claw-back prior to the transfer of Shares in respect of an Award (or “malus”) 

 

	1.	 Where the Board determines (pursuant to Rule 15.1 or 15.2 (Claw-back events)) that a Claw-back shall apply in
respect of an Award prior to legal title to Shares having been transferred to the Participant pursuant to the Award (whether before or after vesting), the Claw-back shall be applied by the Board reducing the number of Shares in respect of which the
Award may vest or, in the case of an Option, be exercised (or after vesting by reducing the number of Shares legal title to which may be transferred pursuant to the Award) by up to the number of Shares determined by the Board to be the excess number
of Shares in respect of which the Award was granted and/or is outstanding (and the Award shall lapse to the extent so reduced, which may be in full). 

Claw-back following the transfer of Shares in respect of an Award 
  

	2.	 Where the Board determines (pursuant to Rule 15.1 or 15.2 (Claw-back events)) that a Claw-back shall
apply in respect of an Award following legal title to Shares having been transferred to the Participant pursuant to the Award (a “Post-Transfer Claw-back”), the Board shall determine: 

 

	 	a.	 the excess number of Shares in respect of which the Award vested (the “Excess Shares”); and

  

	 	b.	 the aggregate Market Value of such Excess Shares (as determined by the Board) on the date on which the Award
vested or, in the case of an Option, the date the Option was exercised (the “Equivalent Value”). 

  

	3.	 In the case of a Post-Transfer Claw-back: 

 

	 	a.	 any dividends received in respect of the Shares subject to a Forfeitable Share Award pursuant to Rule 6.5
(Dividend rights on forfeitable Shares); and/or 

  

	 	b.	 any cash payment made or additional Shares transferred pursuant to Rule 11 (Dividend equivalent) in
respect of such Award shall be subject to the Claw-back to the extent that the Board determines that such cash payment or Shares relate to the Excess Shares. 

  

	4.	 A Post-Transfer Claw-back may be effected in such manner as may be determined by the Board, and notified to the
Participant, including by any one or more of the following: 

  

	 	a.	 by reducing the number of Shares and/or amount of cash in respect of which an Outstanding Award vests or may
vest (or has vested, but in respect of which no Shares have yet been transferred or cash payment made), whether before or after the assessment of performance conditions in respect of such Outstanding Award, by the number of Excess Shares and/or the
Equivalent Value (and such Outstanding Award shall lapse to the extent so reduced); 

  

	 	b.	 by setting-off    against any amounts payable    by any Group Company
to the Participant an amount up to the Equivalent Value (including from any bonus payment which may otherwise become payable to the Participant); and/or 

  

	 	c.	 by requiring the Participant to immediately transfer to the Company a number of Shares equal to the Excess
Shares or a cash amount equal to the Equivalent Value (which shall be an immediately payable debt due to the Company), provided that the Board may reduce the number of Excess Shares or the amount of the Equivalent Value subject to the Claw-back in
order to take account of any Tax Liability (as defined in Rule 13 (Tax Liability)) which arose on the Excess Shares (howsoever delivered to the Participant). 

 

	5.	 For the avoidance of doubt, nothing in Rule 15 (Clawback) or this Appendix shall in any way restrict a
Participant from being able to transfer or otherwise deal in Shares acquired on vesting or exercise of an Award. 

  

	6.	 In paragraph 4 above: 

“Outstanding Award” means any other Award under the Plan, any award or option under any other Employees’ Share Scheme
operated from time to time by any Group Company (other than any award or options granted under any arrangement which satisfies the 

  
 22 

 British American Tobacco 2016 Long Term Incentive Plan 

 

	 	
provisions of Schedules 2 or 3, or (unless the terms of such arrangement state that shares acquired thereunder are subject to claw-back) 4 or 5, of the Income Tax (Earnings and Pensions) Act
2003), or any bonus award under any bonus scheme operated from time to time by any Group Company, in each case which is either held by the Participant at the time of a determination that a Claw-back shall be applied or which are granted to the
Participant following such a determination; and 

 “vests” shall include shares or cash subject to an award
becoming due to be transferred or paid, and in the case of an option, the option becoming exercisable. 

  
 23 

 British American Tobacco 2016 Long Term Incentive Plan 

 

 APPENDIX 2: AWARDS GRANTED TO U.S. TAXPAYERS 

 

	1.	 INTERPRETATION 

 

	1.1	 This Appendix shall form part of the Rules of the Plan. 

 

	1.2	 In this Appendix a reference to a “Paragraph” is to a paragraph of this Appendix.

  

	1.3	 Capitalized terms used in this Appendix that are not otherwise defined in this Appendix shall have the meanings
set forth in the Plan. 

  

	2.	 APPLICATION 

  

	2.1	 The provisions of this Appendix shall apply to a Conditional Award or an Option that is held by any Participant
while he or she is a U.S. Taxpayer. For the avoidance of doubt, any references to an Award in this Appendix shall be to a Conditional Award or an Option (and not to a Forfeitable Share Award). 

 

	2.2	 To the extent that any provision of Paragraphs 4 to 10 is inconsistent with any Rule of the Plan, such
provision of this Appendix shall take precedence. Paragraph 3 is included to aid interpretation. 

  

	3.	 PERFORMANCE AND SERVICE CONDITION 

Rule 5 – Performance Condition 
  

	3.1	 All Awards to which this Appendix applies shall be subject to a Performance Condition, each element of which
shall be assessed over the Performance Period (or, if applicable the period described in Rule 7.4). 

 Rule 8 –
Cessation of Office or Employment 
  

	3.2	 All Awards to which this Appendix applies are subject to a service condition which applies until the
Award’s Normal Vesting Date or any earlier vesting date. 

 Paragraph 5 – Awards where the “wait and see
approach” shall apply (including all Awards subject to an extended vesting period); vesting date 
  

	3.3	 Notwithstanding the date on which a Conditional Award that is subject to Paragraph 5 vests, the Shares in
respect of which such Award vests shall not be transferred to the U.S. Taxpayer until the Normal Vesting Date (subject to any earlier date specified in Paragraph 5.5). Shares in respect of an Option that is subject to Paragraph 5 shall be deemed to
be exercised on the date on which such Option vests pursuant to the Plan, as amended by this Appendix. 

 Rule 8 and
Paragraph 6 – Cessation of Office or Employment; Award without extended vesting period and where the Committee does not determine that the “wait and see” approach shall apply 

 

	3.4	 An Award that is subject to Paragraph 6 will be subject to a service condition until the date on which it
vests, and (a) Shares in respect of a Conditional Award will be transferred to the U.S. Taxpayer no later than the 15th day of the third month following the end of the calendar year in which the Award is no longer subject to a substantial risk
of forfeiture (within the meaning of Code § 409A) and (b) Shares in respect of an Option shall be deemed to be exercised on the date on which such Option vests. 

Rules 7, 8 and 9 – Vesting, Cessation of Office or Employment and Corporate Actions 

 

	3.5	 Where an Award vests prior to the Normal Vesting Date, the extent of vesting shall be determined by such
applicable Rule. 

 Lapse 
  

	3.6	 Awards to which this Appendix applies shall lapse at any time specified in the Rules or this Appendix.

  
 24 

 British American Tobacco 2016 Long Term Incentive Plan 

 

	4.	 APPLICATION OF PARAGRAPH 5 AND 6 

An Award to which this Appendix applies shall be subject to Paragraph 5 or 6, but shall only be capable of being subject to one of Paragraph 5
or Paragraph 6, and which such Paragraph the Award is subject to shall be determined without any involvement of the U.S. Taxpayer and shall not be capable of change for any reason. 

 

	5.	 AWARDS (I) WHERE THE “WAIT AND SEE” APPROACH SHALL APPLY (INCLUDING ALL AWARDS SUBJECT TO AN
EXTENDED VESTING PERIOD), (II) DESCRIBED IN PARAGRAPHS 3.1 AND 3.2 OF ADDENDUM I TO THE PLAN OR (III) THAT OTHERWISE     ARE     NOT EXEMPT     FROM    
CODE     § 409A     AS     A SHORT-TERM DEFERRAL 

  

	5.1	 An Award shall be subject to this Paragraph 5 if: 

 

	 	5.1.1	 the Normal Vesting Date of an Award is more than one year after the end of the Performance Period;

  

	 	5.1.2	 on the Grant Date the U.S. Taxpayer is a director of the Company or a member of the Management Board of the
Company (unless determined otherwise by the Committee prior to the Grant Date); 

  

	 	5.1.3	 such Award is otherwise not exempt from Code § 409A by reason of complying with the short-term deferral
exemption from Code § 409A; and/or 

  

	 	5.1.4	 it is so determined by the Committee prior to the Grant Date (including pursuant to Paragraph 3.2 of Addendum I
to the Plan). 

  

	5.2	 An Award which is subject to this Paragraph 5 shall vest on the earliest of: 

 

	 	5.2.1	 the Normal Vesting Date; 

 

	 	5.2.2	 any date on which the Award vests pursuant to Rule 9 (subject to Paragraph 5.3); 

 

	 	5.2.3	 the U.S. Taxpayer’s death; or 

 

	 	5.2.4	 any earlier vesting date determined by the Board pursuant to Rule 7.7 or Rule 8.2 (including pursuant to
Paragraph 3.1 of Addendum I to the Plan). 

  

	5.3	 An Award subject to this Paragraph 5: 

 

	 	5.3.1	 may only vest under Rule 9 if the event falling within Rule 9 which would give rise to such vesting constitutes
a “change in control event” as described in U.S. Treasury Regulations or other guidance issued pursuant to Code § 409A; and 

  

	 	5.3.2	 to the extent it does not vest by such time, shall lapse on any date on which an Option would lapse pursuant to
Rule 9.2 to 9.6. 

  

	5.4	 An Award subject to this Paragraph 5 that is an Option shall be deemed to be automatically exercised to the
fullest extent permitted by the Rules on the date on which it vests pursuant to the Plan, as amended by this Appendix, and such Shares shall become due to be transferred to the U.S. Taxpayer within 60 days (90 days if such Option vests pursuant
to Paragraph 5.2.3) of such date of automatic exercise. 

  

	5.5	 Any Shares in respect of which a Conditional Award which is subject to this Paragraph 5 vests shall become due
to be transferred to the U.S. Taxpayer within 60 days (90 days in the case of Paragraph 5.5.2(ii) below) of the earlier of: 

  
 25 

 British American Tobacco 2016 Long Term Incentive Plan 

 

	 	5.5.1	 the Normal Vesting Date; or 

 

	 	5.5.2	 if applicable, (i) the date set forth in Paragraph 5.2.2; (ii) the date set forth in Paragraph 5.2.3 or
(iii) any applicable date described in Paragraph 5.2.4, 

 and shall be transferred within such period (and, for the
avoidance of doubt, not prior to such period). 
  

	6.	 AWARDS WITHOUT AN EXTENDED VESTING PERIOD AND WHERE THE “WAIT AND SEE” APPROACH DOES NOT APPLY AND
THAT ARE OTHERWISE EXEMPT FROM CODE § 409A AS A SHORT-TERM DEFERRAL 

  

	6.1	 An Award shall be subject to this Paragraph 6 if the Award is not subject to Paragraph 5.

  

	6.2	 An Award which is subject to this Paragraph 6 shall, subject to Rule 7.6, vest on the earliest of:

  

	 	6.2.1	 the Normal Vesting Date; 

 

	 	6.2.2	 any date on which the Award vests pursuant to Rule 9; 

 

	 	6.2.3	 the Participant’s death; 

 

	 	6.2.4	 any earlier vesting date determined by the Board pursuant to Rule 7.7; and 

 

	 	6.2.5	 the date on which the U.S. Taxpayer ceases to hold office or employment with any Group Company for any of the
reasons specified in Rule 8.2 (for the avoidance of doubt subject to Rule 8.8). 

  

	6.3	 An Award subject to this Paragraph 6 that is an Option shall be deemed to be automatically exercised to the
fullest extent permitted by the Rules on the date on which it vests pursuant to this Plan, as amended by this Appendix, and such Shares shall become due to be transferred to the U.S. Taxpayer no later than the 15th day of March in the calendar year
immediately following the calendar year in which the Award is no longer subject to a substantial risk of forfeiture (within the meaning of Code § 409A). 

  

	6.4	 Any Shares in respect of which a Conditional Award which is subject to this Paragraph 6 vests shall be
transferred to the U.S. Taxpayer no later than the 15th day of March in the calendar year immediately following the calendar year in which the Award is no longer subject to a substantial risk of forfeiture (within the meaning of Code § 409A).

  

	6.5	 Rule 8.3.1 shall not apply to an Award which is subject to this Paragraph 6. 

 

	7.	 DIVIDEND EQUIVALENTS 

Any payment to which a U.S. Taxpayer may become entitled under Rule 11 with respect to an Award shall be paid to the U.S. Taxpayer at the same
time as the transfer of Shares under Paragraph 5.4, 5.5, 6.3 or 6.4, as applicable. 
  

	8.	 CASH ALTERNATIVE 

 

	8.1	 If Shares cannot be delivered in accordance with Paragraph 5.4, 5.5, 6.3 or 6.4, as applicable, because of a
Dealing Restriction, such Award shall instead be satisfied by the payment of a cash equivalent amount pursuant to Rule 12 (as such Rule is amended by Paragraph 8.2). 

 

	8.2	 Any cash payment to which a U.S. Taxpayer may become entitled under Rule 12 with respect to an Award shall be
paid to the U.S. Taxpayer at the same time as the transfer of Shares would have occurred under Paragraph 5.4, 5.5, 6.3 or 6.4, as applicable. 

  

	9.	 CODE § 409A EXEMPTION AND COMPLIANCE 

 

	9.1	 Awards subject to Paragraph 6 are intended to be exempt from Code § 409A to the maximum extent possible
under the exemption for “short-term deferrals” specified in the Treasury Regulations, and the provisions of this Appendix and the Plan, as it applies to 

  
 26 

 British American Tobacco 2016 Long Term Incentive Plan 

 

	 	
such Award, shall be construed, interpreted and applied accordingly. Without limiting the foregoing, the Board shall not exercise any discretion that is otherwise afforded to it under the Plan in
a manner that is inconsistent with such treatment. For the avoidance of doubt, any Award subject to Paragraph 6 shall, in all events, be paid within the short-term deferral period specified in Treasury Regulation § 1.409A-1(b)(4).

  

	9.2	 To the extent that any Award to which this Appendix applies is subject to Code § 409A, the provisions of
this Appendix and the Plan, as it applies to such Award, shall be construed, interpreted and applied in such a way as to comply with the applicable provisions of Code § 409A to the maximum extent possible. If an Award is subject to Code §
409A, then: (i) any payment or transfer of Shares on account of a change in control shall be made only if the change in control qualifies as a “change in control event,” as defined for purposes of Code § 409A; (ii) any
provision in the Plan that is inconsistent with the requirements of Code § 409A shall not apply to such Award; (iii) the Board shall exercise discretion otherwise afforded to it under the Plan (including under Appendix 1 to the Plan) only
to the extent that such exercise of discretion is consistent with the requirements of Code § 409A; and (iv) the U.S. Taxpayer shall not have the right to designate any payment date with respect to such Award. 

 

	9.3	 In the event that a U.S. Taxpayer is deemed to be a “specified employee” on the date of his or her
“separation from service,” as defined for purposes of Code § 409A (other than by reason of death), determined pursuant to identification methodology adopted by a Group Company in compliance with Code § 409A, and if any portion of
the Shares or other payments to be received by such U.S. Taxpayer in respect of an Award upon separation from service would constitute a “deferral of compensation” subject to Code § 409A, then to the extent necessary to comply with
Code § 409A, Shares or amounts that would otherwise be delivered or payable pursuant to this Plan, as amended by this Appendix, during the six (6) month period immediately following the date of such U.S. Taxpayer’s separation from
service shall instead be delivered or paid either (i) during the period commencing on the date that is six (6) months and one (1) day following the date of such U.S. Taxpayer’s separation from service and ending fifteen
(15) days following the first business day of the seventh month after the date of such separation from service, provided that the U.S. Taxpayer shall not have the right to designate the delivery or payment date, or (ii) if earlier, as soon
as practicable (and in any event within ninety (90) days) after the U.S. Taxpayer’s death. 

  

	9.4	 Each Award hereunder shall constitute a separate payment within the meaning of Treasury Regulation
§1.409A-2(b)(2). 

  

	10.	 COOPERATION 

In the event that the terms of this Plan would subject any U.S.    Taxpayer to taxes or penalties under Code § 409A
(“409A Penalties”), the Committee, the Company and such U.S. Taxpayer shall cooperate diligently to amend the terms of the Plan and the U.S. Taxpayer’s Award agreement to avoid such 409A Penalties, to the extent possible,
provided that in no event shall any Group Company be responsible for any 409A Penalties that arise in connection with any amounts payable in respect of any Award granted under this Plan. 

 

	11.	 SETTLEMENT 

No Award subject to paragraph 5 of this Appendix shall be settled with Shares from a trust. 

  
 27 

 British American Tobacco 2016 Long Term Incentive Plan 

 

 ADDENDUM I: AWARDS GRANTED TO RAI PARTICIPANTS (PRIOR TO 2020) 

 

	1.	 APPLICATION 

  

	1.1	 This Addendum applies to Participants who are employees of Reynolds American Inc. or a subsidiary of Reynolds
American Inc. (collectively, “RAI” and such Participants, “RAI Participants”). 

  

	1.2	 This Addendum sets out certain additional terms which apply in respect of Awards granted under the Plan to RAI
Participants prior to 2020. 

  

	1.3	 References in this Addendum to a “Rule” is to the Rule of the Plan. Capitalized terms used in this
Addendum shall, save where otherwise defined herein, have the meaning given in the Rules. To the extent that any provision of this Addendum is inconsistent with any Rule of the Plan, such provision of this Addendum shall take precedence.

  

	2.	 MODIFICATION 

  

	2.1	 The Board may at any time, and without notice to any person, add or alter or discontinue the terms of this
Addendum in any respect without prior notice to any Participant. 

  

	3.	 TERMS 

Retirement 
  

	3.1	 Pursuant to Rule 8.2.5 (Reasons for cessation where Award remain capable of vesting) it has been
determined that Rule 8.1 (Cessation where Awards lapse) shall not apply in respect of a RAI Participant who ceases to hold office or employment with any Group Company (within the meaning of Rule 8.8 (Meaning of cessation of office or
employment)) in circumstances where the RAI Participant meets the criteria set out below (provided that this provision shall not apply where, in the opinion of the Board, the RAI Participant has committed an act or omission which justifies, or
in the opinion of the Board would have justified, summary dismissal of service or notice of cessation of employment on the grounds of misconduct).    The criteria referred to are: a RAI
Participant’s    voluntary termination of his or her employment with RAI (i) on or after his or her 65th birthday, (ii) on or after his or her 55th birthday with 10 or more years of service with RAI, or
(iii) on or after his or her 50th birthday with 20 or more years of service with RAI. RAI shall establish such policies, procedures, rules and guidelines as it determines to be appropriate to administer the preceding sentence, including the
form and timing of the RAI Participant’s notice of the RAI Participant’s intent to retire. 

  

	3.2	 Notwithstanding anything in the Plan or Appendix 2 to the Plan to the contrary, a Conditional Award or an
Option granted to a RAI Participant who is on the Grant Date, or who may become during the applicable Performance Period, eligible for the application of the preceding paragraph, shall be subject to the terms of Paragraph 5 of Appendix 2 to the
Plan. 

 Disability 
  

	3.3	 With respect to RAI Participants, the reference to “disability” in Rule 8.2 (Reasons for cessation
where Awards remain capable of vesting) shall mean that the RAI Participant has become eligible for and is in receipt of benefits under RAI’s Long-Term Disability Plan. RAI shall establish such policies, procedures, rules and guidelines as
it determines to be appropriate to administer the preceding sentence. 

  

	4.	 SETTLEMENT 

  

	4.1	 Awards granted to RAI Participants may, at the discretion of the Board, be satisfied by the transfer of British
American Tobacco p.l.c. American Depositary Shares, and references in the Plan (including any Appendix, Schedule or Addendum thereto) to “Shares” shall be read accordingly. 

 

	4.2	 No Award subject to this Addendum shall be settled with Shares from a trust. 

  
 28 

 British American Tobacco 2016 Long Term Incentive Plan 

 

 ADDENDUM II: AWARDS GRANTED TO RAI PARTICIPANTS (FROM 2020) 

 

	1.	 APPLICATION 

  

	1.1	 This Addendum applies to Participants who are employees of Reynolds American Inc. or a subsidiary of Reynolds
American Inc. (collectively, “RAI” and such Participants, “RAI Participants”). 

  

	1.2	 This Addendum sets out certain additional terms which currently apply in respect of Awards granted under the
Plan to RAI Participants from 2020. 

  

	1.3	 References in this Addendum to a “Rule” is to the Rule of the Plan. Capitalized terms used in this
Addendum shall, save where otherwise defined herein, have the meaning given in the Rules. To the extent that any provision of this Addendum is inconsistent with any Rule of the Plan, such provision of this Addendum shall take precedence.

  

	2.	 MODIFICATION 

  

	2.1	 The Board may at any time, and without notice to any person, add or alter or discontinue the terms of this
Addendum in any respect without prior notice to any Participant. 

  

	3.	 TERMS 

  

	 	Disability	 

  

	3.1	 With respect to RAI Participants, the reference to “disability” in Rule 8.2 (Reasons for cessation
where Awards remain capable of vesting) shall mean that the RAI Participant has become eligible for and is in receipt of benefits under RAI’s Long-Term Disability Plan. RAI shall establish such policies, procedures, rules and guidelines as
it determines to be appropriate to administer the preceding sentence. 

  

	4.	 SETTLEMENT 

  

	4.1	 Awards granted to RAI Participants may, at the discretion of the Board, be satisfied by the transfer of British
American Tobacco p.l.c. American Depositary Shares, and references in the Plan (including any Appendix, Schedule or Addendum thereto) to “Shares” shall be read accordingly. 

 

	4.2	 No Award subject to this Addendum shall be settled with Shares from a trust. 

 

  
 29 

 British American Tobacco 2016 Long Term Incentive Plan 

Performance Condition 
  

 SCHEDULE 1: PERFORMANCE CONDITIONS 

SCHEDULE 1A 

PERFORMANCE CONDITION APPLICABLE TO AWARDS GRANTED 

IN 2016, 2017 2018, 2019 and 2020 

TO PARTICIPANTS OTHER THAN EXECUTIVE DIRECTORS 
  

	1.	 Subject to the Rules, the extent to which the Shares in respect of which an Award is granted (the
“Award Shares”) may vest shall be determined: 

  

	 	a.	 as to 40% of the Award Shares, by reference to the performance target based on Earnings per Share specified in
paragraph 3 below is satisfied 

  

	 	b.	 as to 20% of the Award Shares, by reference to the performance target based on Total Shareholder Return
specified in paragraph 4 below; 

  

	 	c.	 as to 20% of the Award Shares, by reference to the performance target based on the Operating Cash Flow
Conversion Ratio specified in paragraph 5 below; 

  

	 	d.	 as to 20% of the Award Shares, by reference to the performance target based on Net Turnover specified in
paragraph 6 below; and 

  

	2.	 The Performance Period for 

 

	 	a.	 Awards granted in 2016 shall commence on 1 January 2016 and end on 31 December 2018; 

 

	 	b.	 Awards granted in 2017 shall commence on 1 January 2017 and end on 31 December 2019; 

 

	 	c.	 Awards granted in 2018 shall commence on 1 January 2018 and end on 31 December 2020; 

 

	 	d.	 Awards granted in 2019 shall commence on 1 January 2019 and end on 31 December 2021; and 

 

	 	e.	 Awards granted in 2020 shall commence on 1 January 2020 and end on 31 December 2022. 

 

	3.	 Earnings per Share 

 

	 	a.	 The performance target in this paragraph 3 (the “EPS Target”) shall consist of two equal,
independent elements such that the number of Award Shares which vest pursuant to this EPS Target shall be the aggregate of the number of Award Shares which vest pursuant to each element. 

 

	 	b.	 Each element of the EPS Target operates by calculating the compound annual growth in adjusted diluted earnings
per share (unless the Board determines that an alternative definition of earnings per share is more appropriate) for the Company, in the case of the first element measured at current rates of exchange, and in the case of the second element measured
at constant rates of exchange. 

 EPS Target: current rates of exchange 

 

	 	c.	 The percentage of the Award Shares which may vest pursuant to this element of the EPS Target depends upon the
compound annual growth in adjusted diluted earnings per share over the Performance Period, measured at current rates of exchange, as follows: 

  
 30 

 British American Tobacco 2016 Long Term Incentive Plan 

Performance Condition 
  

			
	Compound annual growth rate in adjusted diluted EPS (measured at current rates of exchange) over the Performance Period	  	% of the Award Shares which vest pursuant to this element of the EPS Target
	 	 
	10% pa or greater	  	20%
	 	 
	Between 10% pa and 5% pa	  	Pro-rata between 20% and 4%
	 	 
	5% pa	  	4%
	 	 
	Less than 5% pa	  	0%

 EPS Target: constant rates of exchange 

 

	 	d.	 The percentage of the Award Shares which may vest pursuant to this element of the EPS Target depends upon the
compound annual growth in adjusted diluted earnings per share over the Performance Period, measured at constant rates of exchange, as follows: 

  

			
	Compound annual growth rate in adjusted diluted EPS (measured at constant rates of exchange) over the Performance Period	  	% of the Award Shares which vest pursuant to this element of the EPS Target
	 	 
	10% pa or greater	  	20%
	 	 
	Between 10% pa and 5% pa	  	Pro-rata between 20% and 4%
	 	 
	5% pa	  	4%
	 	 
	Less than 5% pa	  	0%

  

	 	e.	 For the purposes of paragraphs 3.c and 3.d above, compound annual growth in adjusted diluted earnings per share
over the Performance Period (expressed as a percentage) is calculated as follows: 

  
 

 
 Where: 
  

			
	E0 =	  	adjusted diluted earnings per share of the Company in the Financial Year immediately preceding the Financial Year in which the Performance Period begins (being “Year 0”); and
		
	E3 =	  	adjusted diluted earnings per share of the Company in the final Financial Year of the Performance Period (being “Year 3”),

 measured at: 

i. current rates of exchange for the purposes of paragraph 3.c; and 

ii. constant rates of exchange for the purposes of paragraph 3.d, for which purpose the value of E0 and E3 shall be taken as index values,
with the value for E0 being the base index value (representing adjusted diluted earnings per share in Year 0), 

  
 31 

 British American Tobacco 2016 Long Term Incentive Plan 

Performance Condition 
  

 
with the purpose of such index being to reflect changes over the Performance Period in adjusted diluted earnings per share of the Company as measured on a constant currency basis, and E3 being
taken as the value of such index for Year 3, 
 and in either case provided that if the Board determines that a measurement of earnings per
share other than adjusted diluted earnings per share is more appropriate the calculation shall be on that other basis and this paragraph 3 shall apply accordingly). 
  

	4.	 TSR Target 

  

	 	a.	 The percentage of the Award Shares which may vest pursuant to the performance target in this paragraph 4 (the
“TSR Target”) depends upon the Company’s Total Shareholder Return over the Performance Period relative to the Total Shareholder Return of the Comparator Group: 

 

			
	Ranked position of the Company’s TSR against the relevant comparator companies	  	% of the Award Shares which vest pursuant to this TSR Target
	 	 
	Upper quartile or above	  	20%
	 	 
	Between upper quartile and median	  	Pro-rata between 20% and 4%
	 	 
	Median	  	4%
	 	 
	Below median	  	0%

  

	 	b.	 For the purpose of this TSR Target: 

 

	 	i.	 The Comparator Group shall comprise the following companies: 

 

					
	[Altria Group]1	  	Heineken	  	Nestlé
	Anheuser-Busch InBev	  	Imperial Brands	  	PepsiCo Inc
	Campbell Soup Company	  	Japan Tobacco	  	Pernod Ricard
	Carlsberg A/S	  	Johnson & Johnson	  	Philip Morris International
	Coca-Cola	  	Kellogg	  	Procter & Gamble
	Colgate-Palmolive	  	Kimberley-Clark	  	Reckitt Benckiser
	Danone	  	LVMH	  	[SABMiller]2
	Diageo	  	Mondelēz International	  	Unilever

  

	 	ii.	 The Total Shareholder Return of the Company and each of the relevant comparator companies over the relevant
Performance Period (expressed as a percentage) shall be computed as follows: 

  
 

 
  
  

1 Included only for Awards granted from 2019 

2 Included only for Awards granted in 2016 

  
 32 

 British American Tobacco 2016 Long Term Incentive Plan 

Performance Condition 
  

 Where: 
  

			
	TSR0 =	  	the average return index of the relevant companies as calculated by Datastream (or other such data provider as determined by the Board) (excluding Saturdays and Sundays) in the three months preceding the beginning of the
Performance Period; and
		
	TSR3 =	  	the average return index (calculated in the same manner as for TSR0) in the 3 months preceding the end of the Performance Period.

  

	 	iii.	 Unless the Board determines otherwise, the Total Shareholder Return for the Company and each of the relevant
comparator companies shall be calculated on a local currency basis. 

  

	 	iv.	 The Company and the companies in the Comparator Group shall be ranked by the resulting Total Shareholder Return
figures, with the company with the highest figure having the highest ranking, and median and upper quartile performance shall be determined on such basis as the Board, acting reasonably, may specify from time to time. 

 

	5.	 Operating Cash Flow Conversion Ratio Target 

 

	 	a.	 The percentage of the Award Shares which may vest pursuant to the performance target in this paragraph 5 (the
“Operating Cash Flow Conversion Ratio Target”) depends upon the Company’s average Operating Cash Flow as a percentage of Adjusted Operating Profit over the Performance Period: 

 

			
	Average Operating Cash Flow Conversion Ratio over the Performance Period	  	% of the Award Shares which vest pursuant to the Operating Cash Flow Conversion Ratio Target
	 	 
	95% or above	  	20%
	 	 
	Between 95% and 85%	  	Pro-rata between 20% and 4%
	 	 
	85%	  	4%
	 	 
	Less than 85% of Adjusted Operating Profit	  	0%

  

	 	b.	 For the purpose of this Operating Cash Flow Conversion Ratio Target: 

 

	 	i.	 the “Average Operating Cash Flow Conversion Ratio” is the aggregate of the Operating Cash Flow
Conversion Ratios for each Financial Year in the Performance Period, divided by the number of Financial Years in the Performance Period; and 

  

	 	ii.	 the “Operating Cash Flow Conversion Ratio” for a Financial Year (expressed as a percentage) is
calculated as follows: 

  
 

 
 Where: 

“Operating Cash Flow” in respect of a Financial Year is the adjusted profit from operations (excluding associates) plus
depreciation, amortisation and impairment, plus other non-cash items, less the increase / (decrease) in working capital, less net capital expenditure, in each case for such Financial Year. All of these items are excluding

  
 33 

 British American Tobacco 2016 Long Term Incentive Plan 

Performance Condition 
  

 
costs and movements relating to restructuring and integration in the Financial Year; and 

“Adjusted Operating Profit” in respect of a Financial Year is derived by excluding the adjusting items
from the profit from operations for such Financial Year. Adjusting items include restructuring and integration costs, amortisation and impairment of trademarks and similar intangibles, a gain on deemed partial disposal of a trademark and a payment
and release of a provision relating to non-tobacco litigation. 
 For the purpose of this Operating Cash Flow Conversion Ratio Target,
Operating Cash Flow and Adjusted Operating Profit are calculated at current rates of exchange, unless the Board determines otherwise. 
  

	6.	 Net Turnover Target 

 

	 	a.	 The performance target in this paragraph 6 (the “NTO Target”) operates by
calculating the compound annual growth in the Net Turnover of the Company, measured at constant rates of exchange on an organic basis. 

  

	 	b.	 The percentage of the Award Shares which may vest pursuant to this NTO Target depends upon the compound annual
growth in Net Turnover over the Performance Period as follows: 

  

			
	Compound annual growth of Net Turnover over the Performance Period	  	% of the Award Shares which vest pursuant to this NTO Target
	 	 
	5% pa or greater	  	20%
	 	 
	Between 5% pa and 3% pa	  	Pro-rata between 20% and 4%
	 	 
	3% pa	  	4%
	 	 
	Less than 3% pa	  	0%

 provided that, notwithstanding above, but subject to the Rules, no Award Shares shall vest pursuant to
this NTO Target unless the three-year constant currency compound annual growth rate of underlying adjusted operating profit exceeds the compound annual growth rate of the threshold performance level for underlying adjusted operating profit, as
defined annually in the International Executive Incentive Scheme (as approved by the Board). 
  

	 	c.	 For the purposes of this NTO Target, compound annual growth of Net Turnover (expressed as a percentage) is
calculated as follows: 

  
 

 
 Where: 
  

			
	NTO0 =	  	Net Turnover in the Financial Year immediately preceding the Financial Year in which the Performance Period begins (being “Year 0”); and
		
	NTO3 =	  	Net Turnover in the final Financial Year of the Performance Period (being “Year 3”),

 measured at constant rates of exchange, for which purpose the value of NTO0 and NTO3 shall be taken as index values, with the value for NTO0 being the
base index value (representing Net Turnover in Year 0), with the purpose of such index being to reflect changes over the Performance Period in Net Turnover of the Company as measured on a constant currency basis, and NTO3 being taken as the value of such 

  
 34 

 British American Tobacco 2016 Long Term Incentive Plan 

Performance Condition 
  

 
index for Year 3, and where the values for NTO3 and/or NTO0 shall be
adjusted in such manner as is determined by the Board to exclude any Net Turnover attributable to any business acquired or disposed of during the Performance Period or otherwise with the intention that the growth in Net Turnover is assessed by
reference to organic growth. 
  

	7.	 Exchange rates 

In this Schedule: 

“current rates of exchange” means exchange rates applied for each year relevant to a given calculation based on
the average exchange rate in that year; and 
 “constant rates of exchange” means exchange rates applied based on a
re-translation, at prior year exchange rates, of the current year information, in order that the same exchange rates are applied for each year relevant to a given calculation. 

 

	8.	 Adjustment to vesting outcome 

 

	 	a.	 After the performance targets in paragraphs 3 to 6 have been assessed, the Board may make such adjustment to
the percentage of Shares of the Award Shares that vest pursuant to one or more of such performance targets to ensure a fair result for both the Participants and shareholders. 

 

	 	b.	 An adjustment pursuant to this paragraph 8 may be either positive (but, for the avoidance of doubt, not so that
the percentage of the Award Shares which vests pursuant to any one of the performance targets in paragraphs 3 to 6 exceeds the maximum percentage of the Award Shares which may vest pursuant to that performance target, as set out in paragraph 1) or
negative (including reducing the percentage of Awards Shares which vest to nil). For the avoidance of doubt, where the Board makes any adjustment pursuant to this paragraph 8 the percentage of Award Shares to be transferred shall be the percentage
as adjusted by the Board notwithstanding the outcome of the performance targets as set out in paragraphs 3 to 6. 

  

	 	c.	 For the avoidance of doubt, vesting outcomes are subject to any forfeiture or reduction of Awards pursuant to
Rule 15 (Claw-back). 

  

	9.	 Adjustments to performance targets 

 

	 	a.	 In the event of: 

  

	 	i.	 a change to the accounting standards of the Company or similar event; 

 

	 	ii.	 any events which affect any of the companies comprised in the Comparator Group (such as a merger or
de-listing); 

  

	 	iii.	 any variation of capital of the Company or a demerger, delisting, special dividend, rights issue or other event
which may, in the opinion of the Board, affect the current or future value of the Company’s shares; or 

  

	 	iv.	 any other similar event the Board considers relevant which may unduly affect the calculation of the performance
targets set out in paragraphs 3 to 6, 

 the Board may make such adjustments to the terms of this Performance Condition as
it determines appropriate to reflect such event with the intention of ensuring that this Performance Condition continues to assess the performance of the Company on a consistent basis over the Performance Period. 

 

	 	b.	 This Performance Condition may be amended in accordance with Rule 5.4 of the Plan. 

  
 35 

 British American Tobacco 2016 Long Term Incentive Plan 

Performance Condition 
  

 General 
  

	10.	 References in this Schedule 1A to a paragraph are to a paragraph of this Schedule 1A 

  
 36 

 British American Tobacco 2016 Long Term Incentive Plan 

Performance Condition 
  

 SCHEDULE 1B 

PERFORMANCE CONDITION APPLICABLE TO AWARDS GRANTED 

IN 2016, 2017, 2018, 2019 and 2020 

TO EXECUTIVE DIRECTORS OF THE COMPANY 
  

	1.	 Subject to the Rules, the extent to which the Shares in respect of which an Award is granted (the
“Award Shares”) may vest shall be determined: 

  

	 	a.	 as to 40% of the Award Shares, by reference to the performance target based on Earnings per Share specified in
paragraph 3 below is satisfied 

  

	 	b.	 as to 20% of the Award Shares, by reference to the performance target based on Total Shareholder Return
specified in paragraph 4 below; 

  

	 	c.	 as to 20% of the Award Shares, by reference to the performance target based on the Operating Cash Flow
Conversion Ratio specified in paragraph 5 below; 

  

	 	d.	 as to 20% of the Award Shares, by reference to the performance target based on Net Turnover specified in
paragraph 6 below; and 

  

	2.	 The Performance Period for: 

 

	 	a.	 Awards granted in 2016 shall commence on 1 January 2016 and end on 31 December 2018; 

 

	 	b.	 Awards granted in 2017 shall commence on 1 January 2017 and end on 31 December 2019; 

 

	 	c.	 Awards granted in 2018 shall commence on 1 January 2018 and end on 31 December 2020; 

 

	 	d.	 Awards granted in 2019 shall commence on 1 January 2019 and end on 31 December 2021; and 

 

	 	e.	 Awards granted in 2020 shall commence on 1 January 2020 and end on 31 December 2022. 

 

	3.	 Earnings per Share 

 

	 	a.	 The performance target in this paragraph 3 (the “EPS Target”) shall consist of two equal,
independent elements such that the number of Award Shares which vest pursuant to this EPS Target shall be the aggregate of the number of Award Shares which vest pursuant to each element. 

 

	 	b.	 Each element of the EPS Target operates by calculating the compound annual growth in adjusted diluted earnings
per share for the Company, in the case of the first element measured at current rates of exchange, and in the case of the second element measured at constant rates of exchange. 

EPS Target: current rates of exchange 
  

	 	c.	 The percentage of the Award Shares which may vest pursuant to this element of the EPS Target depends upon the
compound annual growth in adjusted diluted earnings per share over the Performance Period, measured at current rates of exchange, as follows: 

  
 37 

 British American Tobacco 2016 Long Term Incentive Plan 

Performance Condition 
  

			
	Compound annual growth rate in adjusted diluted EPS (measured at current rates of exchange) over the Performance Period	  	% of the Award Shares which vest pursuant to this element of the EPS Target
	 	 
	10% pa or greater	  	20%
	 	 
	Between 10% pa and 5% pa	  	Pro-rata between 20% and 3%
	 	 
	5% pa	  	3%
	 	 
	Less than 5% pa	  	0%

 EPS Target: constant rates of exchange 

 

	 	d.	 The percentage of the Award Shares which may vest pursuant to this element of the EPS Target depends upon the
compound annual growth in adjusted diluted earnings per share over the Performance Period, measured at constant rates of exchange, as follows: 

  

			
	Compound annual growth rate in adjusted diluted EPS (measured at constant rates of exchange) over the Performance Period	  	% of the Award Shares which vest pursuant to this element of the EPS Target
	 	 
	10% pa or greater	  	20%
	 	 
	Between 10% pa and 5% pa	  	Pro-rata between 20% and 3%
	 	 
	5% pa	  	3%
	 	 
	Less than 5% pa	  	0%

  

	 	e.	 For the purposes of paragraphs 3.c and 3.d above, compound annual growth in adjusted diluted earnings per share
over the Performance Period (expressed as a percentage) is calculated as follows: 

  
  

 
 Where: 
  

					
	E0 =	 		  	adjusted diluted earnings per share of the Company in the Financial Year immediately preceding the Financial Year in which the Performance Period begins (being “Year 0”); and
			
	E3 =	 		  	adjusted diluted earnings per share of the Company in the final Financial Year of the Performance Period (being “Year 3”),

 measured at: 
  

	 	i.	 current rates of exchange for the purposes of paragraph 3.c; and 

 

	 	ii.	 constant rates of exchange for the purposes of paragraph 3.d, for which purpose the value of E0 and E3 shall be taken as index values, with the value for E0 being the base
index value (representing adjusted diluted earnings per share in Year 0), with the purpose of such index being to reflect changes over the Performance 

  
 38 

 British American Tobacco 2016 Long Term Incentive Plan 

Performance Condition 
  

	 	
Period in adjusted diluted earnings per share of the Company as measured on a constant currency basis, and E3 being taken as the value of such index for Year 3. 

 

	4.	 TSR Target 

  

	 	a.	 The percentage of the Award Shares which may vest pursuant to the performance target in this paragraph 4 (the
“TSR Target”) depends upon the Company’s Total Shareholder Return over the Performance Period relative to the Total Shareholder Return of the Comparator Group: 

 

			
	Ranked position of the Company’s TSR against the relevant comparator companies	  	% of the Award Shares which vest pursuant to this TSR Target
	 	 
	Upper quartile or above	  	20%
	 	 
	Between upper quartile and median	  	Pro-rata between 20% and 3%
	 	 
	Median	  	3%
	 	 
	Below median	  	0%

  

	 	b.	 For the purpose of this TSR Target: 

 

	 	i.	 The Comparator Group shall comprise the following companies: 

 

					
	[Altria Group]3	  	Heineken	  	Nestlé
	 	 	 
	Anheuser-Busch InBev	  	Imperial Brands	  	PepsiCo Inc
	 	 	 
	Campbell Soup Company	  	Japan Tobacco	  	Pernod Ricard
	 	 	 
	Carlsberg A/S	  	Johnson & Johnson	  	Philip Morris International
	 	 	 
	Coca-Cola	  	Kellogg	  	Procter & Gamble
	 	 	 
	Colgate-Palmolive	  	Kimberley-Clark	  	Reckitt Benckiser
	 	 	 
	Danone	  	LVMH	  	[SABMiller]4
	 	 	 
	Diageo	  	Mondelēz International	  	Unilever

  

	 	ii.	 The Total Shareholder Return of the Company and each of the relevant comparator companies over the relevant
Performance Period (expressed as a percentage) shall be computed as follows: 

  
  

 
  

	 	Where:	 

  

					
	TSR0 =	 		  	the average return index of the relevant companies as calculated by Datastream (or other such data provider as determined by the Board)

  
  

	3 	 Included only for Awards granted from 2019 

	4 	 Included only for Awards granted in 2016 

  
 39 

 British American Tobacco 2016 Long Term Incentive Plan 

Performance Condition 
  

					
		 		  	(excluding Saturdays and Sundays) in the three months preceding the beginning of the Performance Period; and
			
	TSR3 =	 		  	the average return index (calculated in the same manner as for TSR0) in the 3 months preceding the end of the Performance Period.

  

	 	iii.	 The Total Shareholder Return for the Company and each of the relevant comparator companies shall be calculated
on a local currency basis. 

  

	 	iv.	 The Company and the companies in the Comparator Group shall be ranked by the resulting Total Shareholder Return
figures, with the company with the highest figure having the highest ranking, and median and upper quartile performance shall be determined on such basis as the Board, acting reasonably, may specify from time to time. 

 

	5.	 Operating Cash Flow Conversion Ratio Target 

 

	 	a.	 The percentage of the Award Shares which may vest pursuant to the performance target in this paragraph 5 (the
“Operating Cash Flow Conversion Ratio Target”) depends upon the Company’s average Operating Cash Flow as a percentage of Adjusted Operating Profit over the Performance Period: 

 

			
	Average Operating Cash Flow Conversion Ratio over the Performance Period	  	% of the Award Shares which vest pursuant to the Operating Cash Flow Conversion Ratio Target
	 	 
	95% or above	  	20%
	 	 
	Between 95% and 85%	  	Pro-rata between 20% and 3%
	 	 
	85%	  	3%
	 	 
	Less than 85% of Adjusted Operating Profit	  	0%

  

	 	b.	 For the purpose of this Operating Cash Flow Conversion Ratio Target: 

 

	 	i.	 the “Average Operating Cash Flow Conversion Ratio” is the aggregate of the Operating Cash Flow
Conversion Ratios for each Financial Year in the Performance Period, divided by the number of Financial Years in the Performance Period; and 

  

	 	ii.	 the “Operating Cash Flow Conversion Ratio” for a Financial Year (expressed as a percentage) is
calculated as follows: 

  
 

 
 Where: 

“Operating Cash Flow” in respect of a Financial Year is the adjusted profit from operations (excluding associates) plus
depreciation, amortisation and impairment, plus other non-cash items, less the increase / (decrease) in working capital, less net capital expenditure, in each case for such Financial Year. All of these items are excluding costs and movements
relating to restructuring and integration in the Financial Year; and 

  
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 British American Tobacco 2016 Long Term Incentive Plan 

Performance Condition 
  

 “Adjusted Operating Profit” in respect of a Financial Year is derived by
excluding the adjusting items from the profit from operations for such Financial Year. Adjusting items include restructuring and integration costs, amortisation and impairment of trademarks and similar intangibles, a gain on deemed partial disposal
of a trademark and a payment and release of a provision relating to non-tobacco litigation. 
 For the purpose of this Operating Cash Flow
Conversion Ratio Target, Operating Cash Flow and Adjusted Operating Profit are calculated at current rates of exchange. 
  

	6.	 Net Turnover Target 

 

	 	a.	 The performance target in this paragraph 6 (the “NTO Target”) operates by calculating the
compound annual growth in the Net Turnover of the Company, measured at constant rates of exchange on an organic basis. 

  

	 	b.	 The percentage of the Award Shares which may vest pursuant to this NTO Target depends upon the compound annual
growth in Net Turnover over the Performance Period as follows: 

  

			
	Compound annual growth of Net Turnover over the Performance Period	  	% of the Award Shares which vest pursuant to this NTO Target
	 	 
	5% pa or greater	  	20%
	 	 
	Between 5% pa and 3% pa	  	Pro-rata between 20% and 3%
	 	 
	3% pa	  	3%
	 	 
	Less than 3% pa	  	0%

 provided that, notwithstanding above, but subject to the Rules, no Award Shares shall vest pursuant to
this NTO Target unless the three-year constant currency compound annual growth rate of underlying adjusted operating profit exceeds the compound annual growth rate of the threshold performance level for underlying adjusted operating profit, as
defined annually in the International Executive Incentive Scheme (as approved by the Board). 
  

	 	c.	 For the purposes of this NTO Target, compound annual growth of Net Turnover (expressed as a percentage) is
calculated as follows: 

  
  
 

 
  

	 	Where:	 

  

					
	NTO0 =	  		  	Net Turnover in the Financial Year immediately preceding the Financial Year in which the Performance Period begins (being “Year 0”); and
			
	NTO3 =	  		  	Net Turnover in the final Financial Year of the Performance Period (being “Year 3”),

 measured at constant rates of exchange, for which purpose the value of NTO0 and NTO3 shall be taken as index values, with the value for NTO0 being the
base index value (representing Net Turnover in Year 0), with the purpose of such index being to reflect changes over the Performance Period in Net Turnover of the Company as measured on a constant currency basis, with NTO3 being taken as the value of such index for Year 3, and where the values for NTO3 and/or NTO0 shall be adjusted in such manner as is determined by the Board to exclude any Net Turnover attributable 

  
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 British American Tobacco 2016 Long Term Incentive Plan 

Performance Condition 
  

 
to any business acquired or disposed of during the Performance Period or otherwise with the intention that the growth in Net Turnover is assessed by reference to organic growth. 

 

	7.	 Exchange rates 

In this Schedule: 

“current rates of exchange” means exchange rates applied for each year relevant to a given calculation based on the average
exchange rate in that year; and 
 “constant rates of exchange” means exchange rates applied based on a re-translation, at
prior year exchange rates, of the current year information, in order that the same exchange rates are applied for each year relevant to a given calculation. 
  

	8.	 Adjustment to vesting outcome 

 

	 	a.	 After the performance targets in paragraphs 3 to 6 have been assessed, the Board may make such adjustment to
the percentage of Shares of the Award Shares that vest pursuant to one or more of such performance targets to ensure a fair result for both the Participants and shareholders. 

 

	 	b.	 An adjustment pursuant to this paragraph 8 may be either positive (but, for the avoidance of doubt, not so that
the percentage of the Award Shares which vests pursuant to any one of the performance targets in paragraphs 3 to 6 exceeds the maximum percentage of the Award Shares which may vest pursuant to that performance target, as set out in paragraph 1) or
negative (including reducing the percentage of Awards Shares which vest to nil). For the avoidance of doubt, where the Board makes any adjustment pursuant to this paragraph 8 the percentage of Award Shares to be transferred shall be the percentage
as adjusted by the Board notwithstanding the outcome of the performance targets as set out in paragraphs 3 to 6. 

  

	 	c.	 For the avoidance of doubt, vesting outcomes are subject to any forfeiture or reduction of Awards pursuant to
Rule 15 (Claw-back). 

  

	9.	 Adjustments to performance targets 

 

	 	a.	 In the event of: 

  

	 	i.	 a change to the accounting standards of the Company or similar event; 

 

	 	ii.	 any events which affect any of the companies comprised in the Comparator Group (such as a merger or
de-listing); 

  

	 	iii.	 any variation of capital of the Company or a demerger, delisting, special dividend, rights issue or other event
which may, in the opinion of the Board, affect the current or future value of the Company’s shares; or 

  

	 	iv.	 any other similar event the Board considers relevant which may unduly affect the calculation of the performance
targets set out in paragraphs 3 to 6, 

 the Board may make such adjustments to the terms of this Performance Condition as
it determines appropriate to reflect such event with the intention of ensuring that this Performance Condition continues to assess the performance of the Company on a consistent basis over the Performance Period. 

 

	 	b.	 This Performance Condition may be amended in accordance with Rule 5.4 of the Plan. 

  
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 British American Tobacco 2016 Long Term Incentive Plan 

Performance Condition 
  

 General 
  

	10.	 References in this Schedule 1B to a paragraph are to a paragraph of this Schedule 1B. 

  
 43

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