Document:

EX-10.3

 Exhibit 10.3 

 

 
 THE FERGUSON
GROUP INTERNATIONAL 
 SHARESAVE PLAN 2019 
  

 

 
 Approved by
resolution of the shareholders of the Company in a general meeting held 
 on 25 April 2019 and amended by resolution of the Board of the
Company on 
 27 January 2021 

Appendix A (UK SAYE) registered with HMRC with reference 

XH1100000156799 
 Approved
by resolution of the shareholders of the Company in a general meeting held 
 on 25 April 2019 and amended by resolution of the Board of
the Company on 
 27 January 2021 
  

 THE FERGUSON GROUP INTERNATIONAL SHARESAVE PLAN 2019 

 

	1.	 DEFINITIONS 

1.1 In this Scheme, unless the context otherwise requires, the following words and expressions shall have the following meanings, namely: 

the Act means the UK Income Tax (Earnings and Pensions) Act 2003; 

Adoption Date means 25 April 2019 or, if applicable, the date that approval for the Scheme is renewed by the Company’s
shareholders in general meeting; 
 Associated Company means an associated company of the Company within the meaning given to those
words by paragraph 47 of Schedule 3 to the Act; 
 the Board means the board of directors of the Company or a duly authorised committee
thereof; 
 Capital Reorganisation means any capitalisation issue, rights issue, sub-division,
consolidation or reduction of capital or any other variation of the share capital of the Company; 
 the Company means the company
incorporated in Jersey as Ferguson plc, with registered number 128484; 
 Control shall have the meaning given to that word by section
995 of the Income Tax Act 2007; 
 the Date of Grant means the date on which an Option is granted; 

DI means a depositary interest representing an ordinary share in the capital of the Company; 

DRS statement means the direct registration system statement of account representing certificated ordinary shares listed and traded on the
relevant United States Stock Exchange held on the Company’s share register maintained in the United States; 
 DTC means the Depository
Trust Company, being the system used to settle trades of uncertificated ordinary shares listed and traded on the relevant United States Stock Exchange held on the Company’s share register maintained in the United States; 

Eligible Employee means any employee (including an executive director) who is eligible to participate in the Scheme under the provisions
of rule 2.3; 
 Exercise Price means the price per Share, expressed in sterling, payable on the exercise of an Option as determined
under rule 2.5 (subject to adjustment under rule 11); 
 Grant Period means the period of 42 days commencing on: 

 

	(a)	 the Adoption Date; 

  

	(b)	 the day immediately following the day on which the Company makes an announcement of its results for the last
preceding financial year, half year or other period; or 

  

	(c)	 any day on which the Board resolves that exceptional circumstances exist which justify the grant of Options;

 the Group means the Company and the Subsidiaries and member of the
group shall be construed accordingly; 
 the Invitation Date means the date on which an invitation to apply for an
Option is issued; 
 London Stock Exchange means London Stock Exchange plc or any successor body thereto; 

Market Value means, in relation to a Share on any day the middle market quotation for a Share (as derived from the Daily Official List of
the London Stock Exchange in the case of a DI priced in Pounds Sterling or from the equivalent such records of the relevant United States Stock Exchange in the case of an ordinary share in the capital of the Company priced in US Dollars) on the
dealing day before the Date of Grant or, if the Committee so determines, the average of the middle-market quotations for a Share (as derived from the Daily Official List of the London Stock Exchange in the case of a DI priced in Pounds Sterling or
from the equivalent such records of the relevant United States Stock Exchange in the case of an ordinary share in the capital of the Company priced in US Dollars) during such period as the Committee may determine but not exceeding 30 dealing days
ending with the dealing day before the Date of Grant provided that such dealing day(s) fall within a Grant Period; 
 the Maturity Date
means in relation to any Option or application for an Option, such date as is stipulated by the Board in the invitation to apply for the Option or in any explanatory material relating to the Option (which shall not normally be less than three
years from the Date of Grant of an Option); 
 Maximum Savings Contribution means £500 or such greater amount as is for the time
being permitted by the Board under the UK SAYE or (where the Savings Contribution is expressed in a Nominated Currency) the Nominated Currency equivalent thereof where the equivalent amount has been calculated by reference to the rate of exchange
determined at the Invitation Date pursuant to rule 2.2 or such other rate as the Board may from time to time determine pursuant to rule 7.6; 

Minimum Savings Contribution means £10 or such other minimum amount as the Board shall from time to time determine or (where the
Savings Contribution is expressed in a Nominated Currency) the Nominated Currency equivalent thereof where the equivalent amount has been calculated by reference to the rate of exchange determined at the Invitation Date pursuant to rule 2.2 or such
other rate as the Board may from time to time determine pursuant to rule 7.6; 
 Monthly Contribution means the monthly sum which shall
not be less than the Minimum Savings Contribution nor more than the Maximum Savings Contribution which an Option Holder has elected to save under his Savings Arrangement which may be expressed either in whole sterling pounds or, at the discretion of
the Board, in specified units of a Nominated Currency; 
 NASDAQ means Nasdaq, Inc. or any successor body thereto; 

  
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 New York Stock Exchange means New York Stock Exchange, Inc. or any successor body thereto;

 Nominated Currency means any currency nominated by the Board pursuant to rule 2.2; 

Non-UK Company Reorganisation Arrangement shall have the meaning given to that term in Appendix A to
this Scheme; 
 Option means a right granted under the Scheme to subscribe for or purchase Shares, which is for the time being subsisting 

Option Holder means any individual who holds a subsisting Option (including, where the context permits, the legal personal
representatives of a deceased Option Holder); 
 Old Ferguson means Ferguson Holdings Limited, a company incorporated in Jersey with
registered number 106605; 
 Old Ferguson Shares means fully paid ordinary shares in the capital of Old Ferguson; 

Participating Company means the Company and each Subsidiary which has been nominated by the Board as a Participating Company for the
purposes of the Scheme; 
 Relevant Date means: 
  

	(a)	 if the Relevant Event falls within rule 9.1(a), the date on which Control is obtained and any conditions to
which the offer is made subject are satisfied; 

  

	(b)	 if the Relevant Event falls within rule 9.1(b), either the date on which the scheme of arrangement is
sanctioned by the court or the date on which the scheme of arrangement becomes effective (as determined by the Board in its absolute discretion); 

  

	(c)	 if the Relevant Event falls within rule 9.1(c), the date on which the person first becomes so bound or
entitled; or 

  

	(d)	 if the Relevant Event falls within rule 9.1(d), the date on which notice of the resolution is given;

 Relevant Event shall have the meaning given to that term in rule 9.1; 

Savings Arrangement means a savings arrangement relating to an Option which has been approved by the Board for the purposes of the
Scheme; 
 Schedule 3 means Schedule 3 to the Act; 

Schedule 3 SAYE Option Scheme has the meaning given to that term by paragraph 49 of Schedule 3; 

Scheme of Arrangement means the scheme of arrangement pursuant to Article 125 of the Companies (Jersey) Law 1991, as amended, to introduce the
Company as a new, Jersey-incorporated holding company to the Group; 
 Scheme of Arrangement Effective Date means 10 May 2019 being the
date on which the Scheme of Arrangement became effective in accordance with its terms; 

  
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 the Scheme means this Ferguson Group International Sharesave Plan 2019 as amended from
time to time; 
 Shares means: 
  

	(a)	 fully paid ordinary shares of 10 pence each in the capital of the Company, whether held in certificated or
uncertificated form, via a DRS statement or via the DTC; 

  

	(b)	 where appropriate the DIs representing such shares; and/or 

 

	(c)	 shares, or DIs representing those shares or DIs following any Capital Reorganisation; 

Sharesave Scheme means a sharesave scheme established by the Company or Old Ferguson; 

Subsidiary means any subsidiary of the Company within the meaning of section 1159 of and Schedule 6 to the UK Companies Act 2006 over
which the Company has Control; 
 Tax Year means the calendar year or, if it would result in a longer period for the exercise of an Option,
the 12 month period in respect of which the Participant’s employing company is obliged to pay tax; 
 Trustee means the trustee or
trustees of any employee benefit trust established by the Company; 
 UK SAYE means the UK
sub-plan which is set out in Appendix A to the Scheme and which is registered with HM Revenue & Customs as a Schedule 3 SAYE option scheme under which options are granted to employees in the UK; 

United States Stock Exchange means the New York Stock Exchange, NASDAQ or such other recognised stock exchange in the United States, on which
the Shares are listed; 
 US Tax means taxation under the rules of the United States of America; and 

US Taxpayer means a person who is or becomes subject to US Tax. 

1.2 Where the context permits the singular shall include the plural and vice versa and the masculine shall include the feminine. 

1.3 References to any act or statutory instrument of UK Parliament or the legislative bodies of Jersey, the United States of America or the European Union (the
EU) shall include any modification, amendment or re-enactment thereof (and shall, in respect of any EU legislation, include any UK legislation enacted in replacement thereof following the
UK’s departure from the EU). 
 1.4 Notwithstanding any other provisions of the Scheme, where an Eligible Employee and/or Option Holder is paid salary
other than on a monthly basis: 
  

	(a)	 references to “months” and “monthly” in the rules shall be interpreted by the Board in such
manner as it, in its absolute discretion, considers appropriate; and 

  

	(b)	 the Board shall take all such steps as it considers necessary or desirable to ensure that an Eligible Employee
and/or Option Holder who is paid salary other than monthly is no better or worse off under the Scheme than an Eligible Employee and/or Option Holder who is paid salary monthly. 

  
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	2.	 INVITATION FOR OPTIONS 

2.1 The Board may, during a Grant Period, but otherwise in its absolute discretion, invite such Eligible Employees as it shall determine to apply for Options
at the Exercise Price. 
 2.2 The Board may nominate a currency other than pounds sterling in which Eligible Employees may elect to save pursuant to rule
7.1, and may determine an exchange rate for pounds sterling and such Nominated Currency which shall be used at the Invitation Date for the purpose of calculating the Nominated Currency equivalent of the Monthly Contribution, the Minimum Savings
Contribution and the Maximum Savings Contribution. At any time, there may be more than one currency nominated pursuant to this rule. 
 2.3 Any employee
(including an executive director) of a Participating Company who has been continuously employed by a Participating Company for a period of up to 12 months is potentially eligible to join the Scheme, unless he has given, or been given, notice to
terminate his contract of employment. 
 2.4 Subject to the specific provisions contained in these rules, the form, manner and timing of invitations to apply
for Options, the form of any Savings Arrangement, the Maturity Dates of the Options, and the maximum number of Shares in respect of which invitations are made on any day (subject to rule 6), shall be at the absolute discretion of the Board. The
Board may adopt Appendices setting out specific requirements in relation to particular overseas countries if that is necessary or desirable to take account of local tax, exchange control or securities laws in such overseas countries. 

2.5 The Exercise Price shall be determined by the Board but shall not be less than the higher of: 

 

	(a)	 in the case of an Option to subscribe for Shares, the nominal value of a Share on the Date of Grant; and

  

	(b)	 the International Minimum Price. 

2.6 For the purposes of rule 2.5(b), the International Minimum Price means such amount as is stipulated by the Board at the Invitation
Date being an amount not less than 80 per cent. of the Market Value of a Share on the Date of Grant or other preceding date or dates during a Grant Period as may be determined by the Board. 

 

	3.	 APPLICATION FOR OPTIONS 

3.1 If an Eligible Employee wishes to apply for an Option he must, within such period after the Invitation Date as is stated in the invitation, deliver to the
Company (or its appointed agent) a duly completed form of application as prescribed by the Board together with a duly completed and signed application for a Savings Arrangement. 

3.2 The Board may, in its sole discretion, treat late applications as valid unless they are received after the Date of Grant. 

  
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	4.	 SCALING DOWN 

4.1 If valid applications are received for Options over a number of Shares in excess of that which the Board has determined to make available on a particular
occasion, the Board may scale down applications, in such manner as it may consider appropriate. 
 4.2 The Board may, as an alternative, determine in its
absolute discretion that no Options shall be granted. 
 4.3 If, in applying the scaling down provisions contained in rule 4.1, Options cannot be granted
within the 30 day period referred to in rule 5.1 below, the Board may extend that period by up to 12 days regardless of the expiry of the relevant Invitation Period. 
  

	5.	 GRANT OF OPTIONS 

5.1 Following the receipt by the Company of valid applications the Board may, subject to rules 3.2 and 4, on a single date which shall not be later than 30
days after the earliest date by reference to which the Exercise Price was calculated, grant all (but not some) of the Options for which application has been made on that occasion by Eligible Employees (provided that they comply with the conditions
of eligibility in rule 2.3 on the Date of Grant) in consideration of such Eligible Employees agreeing to enter into the Savings Arrangements. As soon as practicable thereafter, the Board shall procure the issue of an option certificate or letter of
grant to each Eligible Employee who has been granted an Option. No cash payment shall be made for the grant of an Option. 
 5.2 No Option shall be granted
under the Scheme more than ten years after the Adoption Date. 
  

	6.	 SCHEME LIMITS 

6.1 No individual may be invited to apply for, or may be granted, an Option over such number of Shares that the granting of such Option and the entry into the
related Savings Arrangement would result in the infringement of rules 6.2 or 6.3. 
 6.2 No Eligible Employee may be granted an Option if his Monthly
Contributions under the related Savings Arrangement, when added to the sum of his monthly contributions under any other subsisting Sharesave Scheme, would exceed £250 or such greater amount as is for the time being permitted by the Board under
the UK SAYE or (at the discretion of the Board) the Nominated Currency equivalent thereof where the equivalent amount has been calculated by reference to the rate of exchange determined at the Invitation Date pursuant to rule 2.2 or such other rate
as the Board may from time to time determine pursuant to rule 7.6. Prior to any Invitation Date, the Board may determine that, for the purposes of calculating the limit in this rule 6.2, any monthly contributions under savings arrangements entered
into in connection with options granted under any other subsisting Sharesave Scheme that the Eligible Employee has cancelled (or which has lapsed pursuant to its terms) before the relevant Maturity Date of such option will be deemed to be monthly
contributions being made by such Eligible Employee at the Invitation Date. 

  
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 6.3 No Option to subscribe for Shares shall be granted if the result of that grant would be that the
aggregate number of Shares that could be issued on the exercise of that Option and any other Options granted at the same time, when added to the number of Shares or Old Ferguson Shares that: 

 

	(a)	 could be issued on the exercise of any other subsisting share options granted during the preceding ten years
from the proposed Date of Grant under the Scheme or any other employee share option scheme operated by the Company or Old Ferguson; and 

  

	(b)	 have been issued on the exercise of any share option granted during the preceding ten years from the proposed
Date of Grant under the Scheme or any other employee share option scheme operated by the Company or Old Ferguson; and 

  

	(c)	 have been issued during the preceding ten years from the proposed Date of Grant under any profit sharing or
other employee share incentive scheme (not being a share option scheme) operated by the Company or Old Ferguson, 

 would exceed
10 per cent. of the ordinary share capital of the Company for the time being in issue. 
 6.4 Reference in this rule 6 to the issue
of Shares shall, for the avoidance of doubt, mean the issue and allotment (but not transfer) of Shares. Where Shares are allotted or issued to the Trustee for the purpose of satisfying Options by way of transfer of Shares by the Trustee, that
should be treated as an issue of Shares. Where Shares are transferred or to be transferred from treasury under this Scheme or any other employee share scheme, such Shares shall (for so long as it remains a guideline of institutional shareholders) be
treated as an issue of Shares. 
 6.5 In determining the limit set out in rule 6.3, no account shall be taken of any Shares where the right to acquire the
Shares has been surrendered, has lapsed or is otherwise forfeit. 
  

	7.	 TERMS OF SAVINGS ARRANGEMENTS

 7.1 The Monthly Contribution under an Eligible Employee’s Savings Arrangement shall be subject to the limits in rule 6.2. An
Eligible Employee may elect to save in either whole sterling pounds, or (at the discretion of the Board) in an equivalent amount in a Nominated Currency. The equivalent amount of the Nominated Currency shall be calculated by reference to the rate of
exchange fixed at the Invitation Date pursuant to rule 2.2 or such other rate as the Board may determine from time to time pursuant to rule 7.6. 
 7.2 The
Monthly Contribution shall, unless the Board agrees to a different method for collection, be deducted from the Eligible Employee’s net pay on a monthly basis. 

7.3 If an Option Holder misses more than 12 Monthly Contributions under the Savings Arrangement, the Option shall lapse. If an Option Holder withdraws monies
from his Savings Arrangement other than with a view to the exercise of a related Option, that Option shall lapse. 

  
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 7.4 If applications are scaled down under rule 4 on any occasion, the Monthly Contributions under Savings
Arrangements which Eligible Employees have specified in their applications shall, where necessary, be scaled down to such sums in whole pounds sterling (or whole units of an equivalent amount in a Nominated Currency, as the case may be where the
equivalent amount of the Nominated Currency has been calculated by reference to the exchange rate determined at the Invitation Date pursuant to rule 2.2). The resulting Monthly Contribution shall not be less than the Minimum Savings Contribution.

 7.5 The Savings Arrangement shall be personal to the Eligible Employee and, regardless of the terms of the Option, any savings arising under it shall be
the property of the Eligible Employee concerned. 
 7.6 Where the Monthly Contribution is paid in a Nominated Currency and the amount is equivalent to a
sterling amount calculated on the basis of the exchange rate determined at the Invitation Date pursuant to rule 2.2 (the Original Sterling Amount) the Board may, in exceptional circumstances, and on one or more occasions during the
course of the Savings Arrangement, alter the exchange rate fixed at the Invitation Date to take account of general currency movements and may permit the Nominated Currency amount of the Monthly Contribution to be altered from such date so that,
calculated by reference to such new exchange rate, it is equivalent to the Original Sterling Amount. 
 7.7 Unless the provisions in rule 4 apply, an Option
shall be granted to an Eligible Employee over such number of Shares (N) as is calculated according to the following formula and any fraction of a Share shall be rounded down to the nearest whole Share: 

 
 

 
 Where: 
 MC
represents the Monthly Contribution which the Eligible Employee has elected to save under his Savings Arrangement; 
 Y represents
such number of months as the Board may determine prior to the relevant Invitation Date (the Option Period) plus an additional number of months’ Monthly Contributions which the Board estimates to be equivalent to the likely amount
of interest (if any) to be earned on the Savings Arrangement; 
 EP represents the Exercise Price. 

For the avoidance of doubt if, at the Maturity Date, the actual proceeds of the Savings Arrangement are less than MC, the Option Holder may not top-up the proceeds from a separate source. 
 In no event may the Option Holder acquire on exercise a greater number of
Shares than that over which the Option is granted (and the excess savings shall be returned to the Option Holder). 
  

	8.	 EXERCISE AND LAPSE OF OPTIONS

 8.1 Save as otherwise permitted in these rules, an Option may only be exercised: 

 

	(a)	 during the six months following the Maturity Date relating to it; and 

 

	(b)	 by an Option Holder who is, at the date of exercise, an employee of a Participating Company,

  
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 and, if not exercised, shall lapse at the end of the six month period following the Maturity Date. If,
during the six months’ exercise period referred to above, the Option Holder is subject to any dealing restrictions under the Financial Conduct Authority’s Listing Rules, Regulation (EU) No 596/2014 of the European Parliament and of the
Council of 16 April 2014 on market abuse or any equivalent or successor legislation or any relevant share dealing code of the Company, the six months’ exercise period shall be suspended until such later date as those dealing restrictions
lift. The Option Holder may exercise an Option by written notice to the Company in such form as the Board may prescribe. An Option may only be exercised with Monthly Contributions which have been made as at the date of exercise, including any
interest as at such date. No account shall be taken of any Monthly Contribution the due date of which arises after the date of exercise, or any interest in respect of that Monthly Contribution. Notwithstanding any other provision in these rules, no
Option may be exercised more than 10 years after its Date of Grant. 
 8.2 Every Option granted under this Scheme shall be personal to the Option Holder and,
except to the extent necessary to enable a personal representative to exercise the Option following the death of an Option Holder, neither the Option nor the benefit thereof may be transferred, assigned, charged or otherwise alienated. Any transfer
of an Option otherwise than as permitted in this rule 8.2 shall cause the Option to lapse. 
 8.3 Subject to rule 8.6, where an Option Holder ceases to be an
employee of a Participating Company before the expiry of six months after the Maturity Date of any outstanding Options: 
  

	(a)	 by reason of redundancy (as determined by the Board), injury, retirement or disability, he may exercise any
outstanding Options within six months of the date on which employment ceased, failing which exercise the Options shall lapse automatically: Provided that the Options may not be exercised more than six months following the relevant Maturity Date;

  

	(b)	 on: 

  

	 	(i)	 his employing company ceasing to be under the Control of the Company; or 

 

	 	(ii)	 the business (or part of a business) in which he is employed being transferred to a person who is neither an
Associated Company nor a company over which the Company has Control, 

 he may exercise any outstanding Options within six
months of the date on which employment ceased, failing which exercise the Options shall lapse automatically: Provided that the Options may not be exercised more than six months following the relevant Maturity Date; or 

 

	(c)	 for any other reason as the Board in its absolute discretion may determine, he may exercise any outstanding
Options within six months of the date on which employment ceased, failing which exercise the Options shall lapse automatically: Provided that the Options may not be exercised more than six months following the relevant Maturity Date.

  
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 8.4 If an Option Holder ceases to be an employee of a Participating Company before the expiry of six months
after the Maturity Date of any outstanding Options: 
  

	(a)	 by reason of dismissal for gross misconduct, serious breach or
non-observance of his contract of employment or failure or refusal to carry out the duties assigned to him thereunder; or 

 

	(b)	 for any reason not mentioned in rule 8.3 (other than death), 

his Options lapse automatically upon such cessation. 
 8.5 If an
Option Holder dies, Options granted to him may be exercised by his personal representatives at any time within the 12 month period following: 
  

	(a)	 the date of death, if the date occurred before the relevant Maturity Date; and 

 

	(b)	 the Maturity Date, if the death occurred within six months following the relevant Maturity Date,

 failing which exercise, the Options shall lapse automatically. 

8.6 For the purposes of rule 8.3, an Option Holder shall not be treated as ceasing to be an employee of a Participating Company until he ceases to hold an
office or employment in the Company or any company over which the Company has Control or any Associated Company. 
 8.7 Notwithstanding rule 8.1(b), if, at
the Maturity Date, an Option Holder’s employing company has ceased to be a Participating Company but is an Associated Company or a company over which the Company has Control, Options may be exercised within (but no later than) six months
following the Maturity Date. 
 8.8 If, before the Option has become exercisable, the Option Holder: 

 

	(a)	 gives notice, or is deemed to have given notice, under the terms of the related Savings Arrangement that he
intends to stop paying contributions to that Savings Arrangement; or 

  

	(b)	 makes an application for repayment of the related Savings Arrangement, 

the Option shall automatically lapse. 
 8.9 If an Option becomes
exercisable under any provision of the Scheme before the Maturity Date, it shall be exercisable only over such number of Shares (S) as is calculated according to the following formula and any fraction of a Share shall be rounded
down to the nearest whole Share: 
  
 

 
 Where: 

Z represents the accrued savings under the Savings Arrangement relating to an Option as at the date of exercise of such Option;

 EP represents the Exercise Price of an Option (subject to any adjustments made pursuant to rule 11); 

  
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 8.10 If the actual proceeds of the Savings Arrangement exceeds the amount payable on exercise of the Option
to acquire the number of Shares determined under rule 8.9, the excess savings shall be returned to the Option Holder. 
 8.11 An Option shall lapse
immediately after it is first exercised notwithstanding that it shall not have been exercised in respect of the maximum number of Shares over which the Option was granted. 

8.12 This rule 8.12 shall apply to US Taxpayers. Notwithstanding anything to the contrary contained in the Scheme, an Option Holder who is a US Taxpayer may
only exercise an Option within the shorter of any exercise period specified in the rules of this Scheme and the expiry of two and a half calendar months after the end of the Tax Year in which the Option is no longer subject to a substantial risk of
forfeiture, and thereafter, such Option shall immediately lapse and automatically be cancelled and cease to have any further legal force or effect whatsoever. Options granted to US Taxpayers are intended to be exempt from the requirements of
Section 409A of the Internal Revenue Code of 1986, as amended, pursuant to the short-term deferral exemption described in Section 1.409A-1(b)(4) of the treasury regulations issued under the Code, and
the Scheme and any option certificate in respect of an Option granted to a US Taxpayer shall be interpreted, operated and administered in a manner consistent with such intention. 

 

	9.	 TAKE-OVER AND LIQUIDATION

 9.1 This rule 9 applies if: 
  

	(a)	 any person (either alone or together with any person acting in concert with him) obtains Control of the Company
as a result of making: 

  

	 	(i)	 a general offer to acquire the whole of the issued ordinary share capital of the Company which is made on a
condition such that if it is satisfied, the person making the offer will have Control of the Company; or 

  

	 	(ii)	 a general offer to acquire all of the Shares; 

 

	(b)	 any person proposes to obtain Control of the Company in pursuance of a compromise or arrangement sanctioned by
the Court under Article 125 of the Companies (Jersey) Law 1991 or its equivalent under applicable law; 

  

	(c)	 any person becomes bound or entitled to acquire Shares in the Company under Part 18 of the Companies (Jersey)
Law 1991 or its equivalent under applicable law; or 

  

	(d)	 notice is given of a resolution for the voluntary or compulsory
winding-up of the Company, or 

  

	(e)	 any person (either alone or together with any person acting in concert with him) obtains Control of the Company
as a result of a Non-UK Company Reorganisation Arrangement which becomes binding on the shareholders covered by it, 

(each a Relevant Event). 

  
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 9.2 Where this rule 9 applies and subject to rules 9.3 and 10 below, all outstanding Options will (unless
the Board determines otherwise prior to the Relevant Date) be automatically exercised on the Relevant Date (whether or not the Relevant Event occurs before or within six months of the Maturity Date) provided that the Exercise Price is equal to or
less than the relevant offer price or consideration (as determined by the Board), if applicable. Where this rule 9 applies, and subject to rule 9.3 below, any outstanding Options that are not exercised on the Relevant Date shall lapse automatically
and any savings under the relevant Savings Arrangement relating to such Options shall be returned to the Option Holder save that in the case of any Option which has become exercisable under rule 8.5, such Option shall not lapse under this rule 9.2
on the expiry of the sixth month period following any of the Relevant Events mentioned in rule 9.1(a), (b), (c) or (e) but shall lapse only on the expiry of the relevant 12 month period under rule 8.5. For the avoidance of doubt, any such
Option may lapse on the expiry of the six month period arising under rule 9.1(d) even if this occurs before the expiry of the relevant 12 month period under rule 8.5. 

9.3 Without prejudice to the operation of rule 10, Options shall not be exercisable without the consent of the Board under the foregoing provisions of this
rule 9 if the purpose and effect of the Relevant Event, together with any associated transactions, is to create a new holding company for the Company, such company having substantially the same shareholders and proportionate shareholdings as those
of the Company immediately prior to the Relevant Event. Unless the Board determines otherwise in its absolute discretion, an Option will in such circumstances be exchanged for equivalent options in accordance with rule 10 below. 

 

	10.	 OPTION ROLLOVER 

10.1 If any company (the acquiring company): 
  

	(a)	 obtains Control of the Company as a result of making: 

 

	 	(i)	 a general offer to acquire the whole of the issued ordinary share capital of the Company which is made on a
condition such that if it is satisfied the acquiring company will have Control of the Company; or 

  

	 	(ii)	 a general offer to acquire all the Shares; or 

 

	(b)	 obtains Control of the Company in pursuance of a compromise or arrangement sanctioned by the Court under
Article 125 of the Companies (Jersey) Law 1991 or its equivalent under applicable law; or 

  

	(c)	 becomes bound or entitled to acquire shares in the Company under Part 18 of the Companies (Jersey) Law 1991 or
its equivalent under applicable law, 

  

	(d)	 obtains Control of the Company as a result of a Non-UK Company
Reorganisation Arrangement which has become binding on the shareholders covered by it, 

 and notice of a replacement option is given
(with the consent of the acquiring company), then, on the Relevant Date, any Option which has not lapsed (the old option) shall automatically be released and shall be replaced by an option (the new option) which (in the
opinion of the Board) is equivalent to the old option but relates to shares in a different company (whether the acquiring company itself or another company) (the new grantor). 

  
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 10.2 The provisions of the Scheme shall be construed as if: 

 

	(a)	 the new option were an option granted under the Scheme at the same time as the old option;

  

	(b)	 references to the Company in the rules were references to the new grantor provided that references to the
Participating Company shall continue to be construed as if references to the Company within this definition were to Ferguson plc (company number 128484); 

  

	(c)	 references to the Board in the rules were references to the board of directors of the new grantor;

  

	(d)	 references to Shares were references to shares in the new grantor; 

 

	(e)	 the Savings Arrangement entered into in connection with the old option had been made in connection with the new
option; and 

  

	(f)	 the Maturity Date in relation to the new option was the same as that in relation to the old option.

  

	11.	 ADJUSTMENT OF OPTIONS 

11.1 In the event of any Capital Reorganisation (or the implementation by the Company of a demerger or payment of a super dividend which would otherwise
materially affect the value of an Option), the Exercise Price, the description of Shares and the number of Shares comprised in an Option may be adjusted in such manner as the Board may determine: Provided that: 

 

	(a)	 no adjustment shall be made pursuant to this rule which would increase the aggregate Exercise Price of any
Option; and 

  

	(b)	 no adjustment may have the effect of reducing the Exercise Price to less than the nominal value of a Share.

 11.2 Any adjustment to Options made pursuant to this rule 11 shall be notified to the relevant Option Holder. 

 

	12.	 ALLOTMENT OR TRANSFER OF SHARES
ON EXERCISE OF OPTIONS 

 Subject to any necessary consents, to payment
being made for the Shares and to compliance by the Option Holder with the terms of the Scheme, not later than 30 days after receipt of any notice of exercise in accordance with rule 8, the Company shall either allot and issue or procure the transfer
of Shares to the Option Holder (or to his nominee). The Company shall or, if applicable, shall procure that the Trustee shall, (unless the Shares are to be issued in uncertificated form) as soon as practicable deliver to the Option Holder (or such
nominee) a definitive share certificate or other evidence of title in respect of such Shares. Where the Shares are issued or transferred to a nominee of the Option Holder, the Option Holder shall remain the beneficial owner of the Shares. 

  
 14|34 

	13.	 RIGHTS ATTACHING TO SHARES
ALLOTTED OR TRANSFERRED PURSUANT TO OPTIONS 

13.1 All Shares allotted or transferred upon the exercise of an Option shall rank pari passu in all respects with the Shares in issue at the date of
exercise save as regards any rights attaching to such Shares by reference to a record date prior to the date of exercise. 
 13.2 Any Shares acquired on the
exercise of Options shall be subject to the articles of association of the Company from time to time in force. 
  

	14.	 AVAILABILITY OF SHARES 

14.1 The Company shall at all times keep available for issue sufficient authorised but unissued Shares to permit the exercise of all unexercised Options under
which Shares may be allotted or shall otherwise procure that Shares are available for transfer in satisfaction of the exercise of Options. 
 14.2 If and so
long as the Shares are admitted to listing by the Financial Conduct Authority and admitted to trading on the London Stock Exchange, the Company will, at its expense, apply to the Financial Conduct Authority and to the London Stock Exchange for
admission to the Official List (unless listing has already been granted) and for trading, respectively, of Shares allotted on the exercise of any Option. 
  

	15.	 ADMINISTRATION AND AMENDMENT 

The decision of the Board shall be final and binding in all matters relating to the Scheme and it may at any time discontinue the grant of further Options or
amend any of the provisions of the Scheme in any way it thinks fit: Provided that: 
  

	(a)	 except as herein provided, the Board shall not make any amendment that would materially prejudice the interests
of existing Option Holders in any jurisdiction in which the Scheme operates except with the prior consent or sanction of the Option Holders in that jurisdiction who, if they exercised their Options in full, would thereby become entitled to a
majority of all the Shares which would fall to be allotted or transferred upon exercise in full of all outstanding Options in that jurisdiction; 

  

	(b)	 no amendment to the advantage of Eligible Employees or Option Holders may be made to: 

 

	 	(i)	 the definition of Eligible Employee; 

 

	 	(ii)	 the limitations on the number of Shares subject to the Scheme; 

 

	 	(iii)	 the maximum entitlement for any Eligible Employee under the Scheme; 

 

	 	(iv)	 the basis for determining an Eligible Employee’s entitlement to Shares under the Scheme;

  

	 	(v)	 the terms of Shares to be provided under the Scheme; and 

 

	 	(vi)	 the adjustments to Options, under rule 11, in the event of a Capital Reorganisation, 

  
 15|34 

 without the prior approval of the Company in general meeting except in the case of minor
amendments to benefit the administration of the Scheme, to take account of a change in legislation or to obtain or maintain favourable tax, exchange control or regulatory treatment for Eligible Employees and Option Holders or any member of the
Group; 
  

	(c)	 without prejudice to any provision of the Scheme which provides for the lapse of an Option, the Board may not
cancel an Option unless the Option Holder agrees in writing to such cancellation. 

  

	16.	 TAX 

Any liability of an Option Holder to taxation or social security contributions shall be for the account of the relevant Option Holder and the issue or transfer
of any Shares subject to an Option Holder’s Option shall be conditional upon the Option Holder having discharged the amount required to satisfy the taxation or social security contributions which arise in respect of the Option and the Shares
subject to the Option to the satisfaction of the Company, or otherwise having complied with any arrangements specified by the Company to secure that such taxation or social security contributions are satisfied including irrevocably authorising the
Company to sell or procure the sale of sufficient Shares on or following the exercise of his Option on his behalf to ensure that any relevant member of the Group or former member of the Group receives the amount required to discharge the taxation or
social security contributions which arise and by participating in the Scheme an Option Holder is deemed to have given such authorisation. 
  

	17.	 GENERAL 

17.1 Any Participating Company may provide money to the Trustee or any other person to enable them or him to acquire Shares to be held for the purposes of the
Scheme, or enter into any guarantee or indemnity for those purposes, to the extent not prohibited by applicable law. 
 17.2 Notwithstanding any other
provision of the Scheme: 
  

	(a)	 the Scheme shall not form part of any contract of employment between the Company or any Subsidiary and an
Option Holder; 

  

	(b)	 no Eligible Employee has any right to be granted an Option and the fact that an Eligible Employee may have
received invitations to participate in the Scheme and/or been granted Options under the Scheme shall not entitle any Eligible Employee to future invitations or grants; 

 

	(c)	 the benefit to an Option Holder of participation in the Scheme (including, in particular but not by way of
limitation, any Options held by him) shall not form any part of his contractual remuneration or benefits or count as his contractual remuneration or benefits for any purpose; 

 

	(d)	 nothing in the Scheme shall in any way be construed as imposing upon any member of the Group a contractual
obligation as between the member of the Group and an Option Holder to contribute to the Scheme; and 

  
 16|34 

	(e)	 if an Option Holder ceases to be employed within the Group, he shall not be entitled to compensation for the
loss of any right or benefit or prospective right or benefit under the Scheme (including, in particular but not by way of limitation, any Options held by him which lapse by reason of his ceasing to be employed within the Group whether lawfully or
unlawfully) whether by way of damages for unfair dismissal, wrongful dismissal, breach of contract or otherwise (or by way of similar provisions of the law of the jurisdiction in which the Option Holder is resident). 

By participating in the Scheme, an Option Holder is deemed to have agreed to the provisions of the Scheme and in particular, this rule 17.2.

 17.3 The existence of any Option shall not affect in any way the right or power of the Company or its shareholders to make or authorise any or all
adjustments, recapitalisations, reorganisations or other changes in the Company’s capital structure, or any merger or consolidation of the Company, or any issue of shares, bonds, debentures, preferred or prior preference stocks ahead of or
convertible into, or otherwise affecting the Shares or the rights thereof, or the dissolution or liquidation of the Company or any sale or transfer of all or any part of its assets or business, or any other corporate act or proceeding, whether of a
similar character or otherwise. 
 17.4 Any notice or other document required to be given under or in connection with the Scheme may be delivered to an
Option Holder or sent by post to him at his home address according to the records of his employing company or such other address as may appear to the Company to be appropriate. Notices sent by post shall be deemed to have been given on the day
following the date of posting. Any notice or other document required to be given to the Company under or in connection with the Scheme may be delivered or sent by post to it at its corporate services office at 1020 Eskdale Road, Winnersh, Wokingham
RG41 5TS (or such other place or places as the Board may from time to time determine and notify to Option Holders). 
 17.5 The Company, or where the Board
so directs any Subsidiary, shall pay the appropriate stamp duty on behalf of the Option Holders in respect of any transfer of Shares on the exercise of the Options. 

17.6 Benefits under this Scheme shall not be pensionable. 
 17.7
By accepting the grant of an Option, a Participant acknowledges that the Company or any member of the Group may hold, process and transfer personal data relating to them to other members of the Group or to any third parties engaged by them (whether
within or outside of the European Economic Area (EEA) and that personal data may also be processed outside the EEA by the Company or any member of the Group or by one or more held or of its or their service providers) for any and all purposes
related to the operation and administration of the Plan and/or in order to meet any legal obligation, in each case in accordance with the Company’s Share Plan Data Protection Protocol and applicable law. 

17.8 These rules shall be governed by, and construed in accordance with, the laws of England. Unless specifically stated otherwise, each Option Holder, the
Company and any other Participating Company or Associated Company submits to the exclusive jurisdiction of the English courts in relation to all disputes arising out of or in connection with the Scheme. 

  
 17|34 

 APPENDIX A 

THE UK SAYE 
 The provisions of this
Appendix A should apply to any Eligible Employee of a UK Participating Company. 
  

	1.	 DEFINITIONS 

1.1 In this Appendix A, unless the context otherwise requires, the following words and expressions shall have the following meanings, namely: 

the Act means the UK Income Tax (Earnings and Pensions) Act 2003; 

Adoption Date means 25 April 2019 or, if applicable, the date that approval for this Appendix A is renewed by the Company’s
shareholders in general meeting; 
 Appendix A means this Appendix A of the Scheme as may be amended from time to time; 

Associated Company means an associated company of the Company within the meaning given to those words by paragraph 47 of Schedule 3 to
the Act; 
 the Board means the board of directors of the Company or a duly authorised committee thereof; 

Bonus Date means, in relation to an Option: 
  

	(a)	 where the Option is linked to a three year Savings Contract, the earliest date on which the bonus is payable
under that Savings Contract (that is, after making 36 Monthly Contributions); or 

  

	(b)	 where the Option is linked to a five year Savings Contract under which the Option Holder has elected to receive
the five year bonus, the earliest date on which the five year bonus is payable under that Savings Contract (that is, after making 60 Monthly Contributions); 

Capital Reorganisation means any capitalisation issue, rights issue, sub-division, consolidation
or reduction of capital or any other variation of the share capital of the Company; 
 the Company means the company incorporated in Jersey as
Ferguson plc, with registered number 128484; 
 Continuous Service has the same meaning as continuous employment
in the Employment Rights Act 1996; 
 Control shall have the meaning given to that word by section 995 of the Income Tax Act 2007;

 the Date of Grant means the date on which an Option is granted; 

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

  
 18|34 

 DI means a depositary interest representing an ordinary share in the capital of the Company;

 Eligible Employee means any employee (including an executive director) who is eligible to participate in this Appendix A under the
provisions of rule 2.2; 
 Exercise Price means the price per Share payable on the exercise of an Option as determined under rule 2.4
(subject to adjustment under rule 11); 
 Grant Period means the period of 42 days commencing on: 

 

	(a)	 the day immediately following the day on which the Company makes an announcement of its results for the last
preceding financial year, half year or other period; 

  

	(b)	 any day on which the Board resolves that exceptional circumstances exist which justify the grant of Options; or

  

	(c)	 any day on which any change to the legislation affecting a Schedule 3 SAYE Option Scheme is proposed or made;

 the Group means the Company and the Subsidiaries and member of the group shall be construed
accordingly; 
 HMRC means Her Majesty’s Revenue & Customs; 

the Invitation Date means the date on which an invitation to apply for an Option is issued; 

London Stock Exchange means London Stock Exchange plc or any successor body thereto; 

Market Value means in relation to a Share on any day: 
  

	(a)	 if and so long as the Shares are listed by the Financial Conduct Authority, its middle market quotation (as
derived from the Daily Official List of the London Stock Exchange); or 

  

	(b)	 subject to (a) above, its market value as determined in accordance with Part VIII of the Taxation of
Chargeable Gains Act 1992 and agreed in advance with the Shares and Assets Valuation Division of HMRC; 

 in either case, determining if
so required for the purposes of any relevant provision in Schedule 3, the market value of a Share that is subject to a Restriction, as if it were not subject to the Restriction; 

Maximum Savings Contribution means £500 or such greater amount as is for the time being permitted under paragraph 25(3) of Schedule
3 and approved by the Board; 
 Minimum Savings Contribution means the amount of the monthly contribution to be paid under the Savings
Contract being not less than £10 or such other minimum amount as may be permitted under paragraph 25 of Schedule 3 and approved by the Board from time to time; 

  
 19|34 

 Monthly Contribution means the monthly sum which shall not be less than the Minimum
Savings Contribution nor more than the Maximum Savings Contribution which an Option Holder has elected to save under his Savings Contract; 
 Non-UK Company Reorganisation Arrangement has the meaning given to that term by paragraph 47A of Schedule 3; 

Option means a right granted under this Appendix A to subscribe for or purchase Shares, which is for the time being subsisting; 

Option Holder means any individual who holds a subsisting Option (including, where the context permits, the legal personal
representatives of a deceased Option Holder); 
 Old Ferguson means Ferguson Holdings Limited, a company incorporated in Jersey with
registered number 106605; 
 Old Ferguson Shares means fully paid ordinary shares in the capital of Old Ferguson; 

Participating Company means the Company and each Subsidiary which has been nominated by the Board as a Participating Company for the
purposes of this Appendix A; 
 Relevant Date means: 
  

	(a)	 if the Relevant Event falls within rule 9.1(a), the date on which Control is obtained and any conditions to
which the offer is made subject are satisfied; 

  

	(b)	 if the Relevant Event falls within rule 9.1(b), the date on which the scheme of arrangement is sanctioned by
the court; 

  

	(c)	 if the Relevant Event falls within rule 9.1(c), the date on which the person first becomes so bound or
entitled; or 

  

	(d)	 if the Relevant Event falls within rule 9.1(d), the date on which notice of the resolution is given; or

  

	(e)	 if the Relevant Event falls within rule 9.1(e), the date on which the
Non-UK Reorganisation Arrangement becomes binding on the shareholders covered by it; 

Relevant Event shall have the meaning given to that term in rule 9.1; 

Restriction means a restriction within the meaning given to that term by paragraph 48(3) of Schedule 3; 

Savings Contract means a contract under a certified contractual savings scheme, within the meaning of paragraph 24 of Schedule 3, the
terms of which must be the same for each participant; 
 Schedule 3 means Schedule 3 to the Act; 

Schedule 3 SAYE Option Scheme has the meaning given to that term by paragraph 49 of Schedule 3; 

  
 20|34 

 Scheme of Arrangement means the Scheme of Arrangement pursuant to Article 125 of the Companies
(Jersey) Law 1991, as amended, to introduce a new, Jersey-incorporated holding company to the Group; 
 Scheme of Arrangement Effective Date
means 10 May 2019 being the date on which the Scheme of Arrangement became effective in accordance with its terms; 
 the
Scheme means the Ferguson Group International Sharesave Plan 2019 as may be amended from time to time; 
 Shares means:

  

	(a)	 fully paid and irredeemable ordinary shares in the capital of the Company, which comply with the conditions in
paragraphs 17 to 20 and paragraph 22 of Part 4 of Schedule 3; 

  

	(b)	 where appropriate the DIs representing such shares; and/or 

 

	(c)	 shares, or DIs representing those shares following any Capital Reorganisation; 

Sharesave Scheme means a sharesave scheme established by the Company or Old Ferguson; 

Subsidiary means any subsidiary of the Company within the meaning of section 1159 of and Schedule 6 to the UK Companies Act 2006 over
which the Company has Control; 
 Tax Year means the calendar year or, if it would result in a longer period for the exercise of an Option,
the 12 month period in respect of which the Participant’s employing company is obliged to pay tax; 
 Trustee means the trustee or
trustees of any employee benefit trust established by the Company; 
 US Tax means taxation under the rules of the United States of America;
and 
 US Taxpayer means a person who is or becomes subject to US Tax. 

1.2 Where the context permits the singular shall include the plural and vice versa and the masculine shall include the feminine. 

1.3 References to any act or statutory instrument of UK Parliament shall include any modification, amendment or
re-enactment thereof. 
 1.4 Notwithstanding any other provisions of this Appendix A, where an Eligible Employee
and/or Option Holder is paid salary other than on a monthly basis: 
  

	(a)	 references to “months” and “monthly” in the rules shall be construed having regard to such
other period by reference to which the Eligible Employee and/or Option Holder is paid; and 

  

	(b)	 the Board shall take all such steps as it considers necessary or desirable to ensure that an Eligible Employee
and/or Option Holder who is paid salary other than monthly is no better or worse off under this Appendix A than an Eligible Employee and/or Option Holder who is paid salary monthly. 

  
 21|34 

 1.5 This Appendix A is intended to be a Schedule 3 SAYE Option Scheme for the purposes of the Act and
Appendix A and any Option granted under it shall be interpreted, operated and administered in a manner that is consistent with that intention and in the case of any conflict between these Rules and the provisions of sections 516, 517 and 519 of and
Schedule 3 to the Act (the legislation), the legislation shall prevail. 
  

	2.	 INVITATION FOR OPTIONS 

2.1 The Board may, during a Grant Period, invite all Eligible Employees to apply for Options at the Exercise Price. 

2.2 The following individuals are Eligible Employees: 
  

	(a)	 any individual who, at the Invitation Date: 

 

	 	(i)	 is an employee, including an executive director, of one or more Participating Companies who, in the case of a
director, is required under the terms of his employment to devote at least 25 hours each week (excluding meal breaks) to his duties; 

  

	 	(ii)	 has earnings from the office or employment referred to in (i) above that meet (or would meet if there were
any) the requirements set out in paragraphs 6(2)(c) of Schedule 3; 

  

	 	(iii)	 has been in Continuous Service with one or more Participating Companies for such period as the Board may
determine (not exceeding five years) prior to the Date of Grant; and 

  

	(b)	 any other individual who, at the Invitation Date, is an employee or director of one or more Participating
Companies and who is nominated by the Board (or falls within a category or individuals nominated by the Board) as eligible to participate in this Appendix A in respect of any one or more grants of Options. 

2.3 Subject to the specific provisions contained in these rules, the form, manner and timing of invitations to apply for Options, the number of Shares in
respect of which invitations are made on any date and whether the Options will be three, five or seven year Options (or any of them, at the election of Eligible Employees), shall be at the absolute discretion of the Board. The invitation may either
state the Exercise Price or (provided a mechanism exists by which the Exercise Price will be determined by the Date of Grant) invite applications by reference to amounts of monthly savings. 

2.4 The Exercise Price shall be determined by the Board but shall not be less than the higher of: 

 

	(a)	 in the case of an Option to subscribe for Shares, the nominal value of a Share on the Date of Grant; and

  

	(b)	 80 per cent. of the Market Value of a Share on (i) the Dealing Day immediately before the Invitation
Date, or (ii) if the Board so determines, the three Dealing Days immediately preceding the Invitation Date, or (iii) such other time or times as may be agreed with HMRC. 

  
 22|34 

	3.	 APPLICATION FOR OPTIONS 

3.1 If an Eligible Employee wishes to apply for an Option he must, within such period (which shall not be less than 14 days) after the Invitation Date as is
stated in the invitation, deliver to the Company (or its appointed agent) a duly completed form of application as prescribed by the Board on which the Eligible Employee must have indicated the Bonus Date on which he intends to apply for repayment,
together with a duly completed and signed application for a Savings Contract. 
 3.2 The application for an Option shall be deemed to be for an Option over
the largest whole number of Shares which can be acquired at the Exercise Price with the expected repayment, including any relevant bonus, under the related Savings Contract at the appropriate Bonus Date. 

3.3 The Board may treat all late applications as valid unless they are received fewer than three business days before the Date of Grant. 

 

	4.	 SCALING DOWN 

4.1 If valid applications are received for Options over a number of Shares in excess of that which the Board has determined to make available on a particular
occasion, the Board may scale down applications, in accordance with the following steps in this rule 4, in such order and combination as the Board may determine (acting fairly and reasonably): 

 

	(a)	 if the repayment under the Savings Contract would otherwise be taken as including the seven year bonus it shall
be taken to include a bonus but not the seven year bonus; 

  

	(b)	 reducing the proposed Monthly Contributions pro rata to the excess over such amount as the Board shall
determine for this purpose being not less than the Minimum Savings Contribution; 

  

	(c)	 if the repayment under the Savings Contract would otherwise be taken as including a bonus, it should be taken
as not including a bonus; and 

  

	(d)	 selecting applications by lot, each based on a Monthly Contribution of the Minimum Savings Contribution and the
inclusion of no bonus in the repayment under the Savings Contract. 

 4.2 If the number of Shares available is insufficient to enable an
Option based on Monthly Savings Contributions of the Minimum Savings Contribution and the inclusion of no bonus in the repayment under the Savings Contract to be granted to each Eligible Employee making a valid application, the Board may, as an
alternative to selecting by lot, determine in its absolute discretion that no Options shall be granted. 
 4.3 If, in applying the scaling down provisions
contained in rule 4.1, Options cannot be granted within the 30 day period referred to in rule 5.2 below, the Board may extend that period by up to 12 days regardless of the expiry of the relevant Invitation Period. 

  
 23|34 

	5.	 GRANT OF OPTIONS 

5.1 No Option shall be granted to any person if at the Date of Grant that person shall have ceased to be an Eligible Employee. 

5.2 Following the receipt by the Company of valid applications the Board may, subject to rules 3.3 and 4, on a single date which shall not be later than the
thirtieth day after the earliest date by reference to which the Exercise Price was calculated, grant all (but not some) of the Options for which valid application has been made on that occasion by Eligible Employees in consideration of such Eligible
Employees agreeing to enter into the Savings Contracts. As soon as practicable thereafter, the Board shall procure the issue of an option certificate or letter of grant to each Eligible Employee who has been granted an Option. If the Shares which
are the subject of an Option are subject to any Restriction, the Company shall as soon as practicable after the Date of Grant notify Option Holders of that fact and the details of any such Restriction. No cash payment shall be made for the
grant of an Option. 
 5.3 No Option shall be granted under this Appendix A more than 10 years after the Adoption Date. 

 

	6.	 SCHEME LIMITS 

6.1 No individual may be invited to apply for, or may be granted, an Option over such number of Shares that the granting of such Option and the entry into the
related Savings Contract would result in the infringement of rules 6.2 or 6.3. 
 6.2 No Eligible Employee may be granted an Option if his Monthly
Contributions under the related Savings Contract, when added to the sum of his monthly contributions under any other subsisting Sharesave Scheme, would exceed the Maximum Savings Contribution. Prior to any Invitation Date, the Board may determine
that, for the purposes of calculating the limit in this rule 6.2, any monthly contributions under savings contracts entered into in connection with options granted under any other subsisting Sharesave Scheme that the Eligible Employee has cancelled
(or which has lapsed pursuant to its terms) before the relevant Bonus Date of such option will be deemed to be monthly contributions being made by such Eligible Employee at the Invitation Date. 

6.3 No Option to subscribe for Shares shall be granted under this Appendix A if the result of that grant would be that the aggregate number of Shares that
could be issued on the exercise of that Option and any other Options granted at the same time, when added to the number of Shares or Old Ferguson Shares that: 
  

	(a)	 could be issued on the exercise of any other subsisting share options granted during the preceding 10 years
from the proposed Date of Grant under the Scheme or any other employee share option scheme operated by the Company or Old Ferguson; and 

  

	(b)	 have been issued on the exercise of any share option granted during the preceding 10 years from the proposed
Date of Grant under the Scheme or any other employee share option scheme operated by the Company or Old Ferguson; and 

  

	(c)	 have been issued during the preceding 10 years from the proposed Date of Grant under any profit sharing or
other employee share incentive scheme (not being a share option scheme) operated by the Company or Old Ferguson, 

  
 24|34 

 would exceed 10 per cent. of the ordinary share capital of the Company for the time being in issue.

 6.4 Reference in this rule 6 to the issue of Shares shall, for the avoidance of doubt, mean the issue and allotment (but not transfer) of Shares.
Where Shares are allotted or issued to the Trustee for the purpose of satisfying Options by way of transfer of Shares by the Trustee, that should be treated as an issue of Shares. Where Shares are transferred or to be transferred from treasury under
this Scheme or any other employee share scheme, such Shares shall (for so long as it remains a guideline of institutional shareholders) be treated as an issue of Shares. 

6.5 In determining the limit set out in rule 6.3, no account shall be taken of any Shares where the right to acquire the Shares has been surrendered, has
lapsed or is otherwise forfeit. 
  

	7.	 TERMS OF SAVINGS CONTRACTS

 7.1 The Monthly Contribution shall be deducted from the Eligible Employee’s net pay on a monthly basis or via such other method
of collection to be determined in accordance with the terms of the Savings Contract and with the approval of HMRC. 
 7.2 If an Option Holder misses more
than 12 Monthly Contributions under the Savings Contract, the Option shall lapse. If an Option Holder withdraws monies from his Savings Contract other than with a view to the exercise of a related Option, that Option shall lapse. 

7.3 The Savings Contract shall be personal to the Eligible Employee and, regardless of the terms of the Option, any savings arising under it shall be the
property of the Eligible Employee concerned. 
  

	8.	 EXERCISE AND LAPSE OF OPTIONS

 8.1 Save as otherwise permitted in these rules, an Option may only be exercised: 

 

	(a)	 during the six months following the Bonus Date relating to it; and 

 

	(b)	 by an Option Holder who is, at the date of exercise, a director or employee of a Participating Company,

 and, if not exercised, shall lapse at the end of the six month period following the Bonus Date. The Option Holder may exercise an
Option by written notice to the Company in such form as the Board may prescribe. 
 8.2 Every Option granted under this Appendix A shall be personal to the
Option Holder and, except to the extent necessary to enable a personal representative to exercise the Option following the death of an Option Holder, neither the Option nor the benefit thereof may be transferred, assigned, charged or otherwise
alienated. Any transfer of an Option otherwise than as permitted in this rule 8.2 shall cause the Option to lapse. 

  
 25|34 

 8.3 Where an Option Holder ceases to be a director or employee of a Participating Company before the expiry
of six months after the Bonus Date: 
  

	(a)	 on retirement or by reason of redundancy (within the meaning of the Employment Rights Act 1996), injury or
disability or a relevant transfer within the meaning of the Transfer of Undertakings (Protection of Employment) Regulations 2006, he may exercise any outstanding Options within six months of the date on which employment ceased, failing which
exercise the Options shall lapse automatically: Provided that the Options may not be exercised more than six months following the relevant Bonus Date; 

  

	(b)	 on: 

  

	 	(i)	 the business (or part of a business) in which he is employed being transferred to a person who is neither an
Associated Company nor a company over which the Company has Control where the transfer is not a relevant transfer within the meaning of the Transfer of Undertakings (Protection of Employment) Regulations 2006, or 

 

	 	(ii)	 his employing company ceasing to be an associated company (as defined in paragraph 35 of Schedule 3) of the
Company by reason of a change of control of the Company (as determined in accordance with sections 450 and 451 of the Corporation Tax Act 2010), 

he may exercise any outstanding Options within six months of the date on which employment ceased, failing which exercise the Options shall
lapse automatically: Provided that the Options may not be exercised more than six months following the relevant Bonus Date; or 
  

	(c)	 for any other reason other than dismissal for gross misconduct, serious breach or non-observance of his contract of employment or failure or refusal to carry out the duties assigned to him thereunder, he may exercise any outstanding Options that have been held for at least 3 years at the date of
such cessation within six months of the date on which employment ceased, failing which exercise the Options shall lapse automatically: Provided that the Options may not be exercised more than six months following the relevant Bonus Date.

 8.4 Subject to rule 8.5, if an Option Holder ceases to be a director or employee of a Participating Company before the expiry of six
months after the Bonus Date of any outstanding Options by reason of dismissal for gross misconduct, serious breach or non-observance of his contract of employment or failure or refusal to carry out the duties
assigned to him thereunder, his Options lapse automatically upon such cessation. 
 8.5 If an Option Holder dies, such Options may be exercised by his
personal representatives at any time within the 12 month period following: 
  

	(a)	 the date of death, if the date occurred before the relevant Bonus Date; and 

 

	(b)	 the Bonus Date, if the death occurred within six months following the relevant Bonus Date,

 failing which exercise, the Options shall lapse automatically. 

  
 26|34 

 8.6 For the purposes of rule 8.3, an Option Holder shall not be treated as ceasing to be a director or
employee of a Participating Company until he ceases to hold an office or employment in the Company or any company over which the Company has Control or any Associated Company. 

8.7 Notwithstanding rule 8.1(b), if, at the Bonus Date, an Option Holder’s employing company has ceased to be a Participating Company but is an Associated
Company or a company over which the Company has Control, Options may be exercised within (but no later than) six months following the Bonus Date. 
 8.8 If,
before the Option has become exercisable, the Option Holder: 
  

	(a)	 gives notice, or is deemed to have given notice, under the terms of the related Savings Contract that he
intends to stop paying contributions to that Savings Contract; or 

  

	(b)	 makes an application for repayment of the related Savings Contract, 

the Option shall automatically lapse. 
 8.9 If an
Option Holder is declared bankrupt or enters into any general composition with or for the benefit of his creditors including a voluntary arrangement under the Insolvency Act 1986, his Options shall automatically lapse. 

8.10 An Option may only be exercised with monies as nearly as possible equal to but not exceeding the amount repaid under the related Savings Contract,
including any bonus or interest as at the date of repayment. No account shall be taken of any repayment of any contribution the due date of which arises after the date of repayment, or any bonus or interest in respect of that contribution. 

8.11 An Option Holder may exercise his Option on one occasion only, in whole or in part, by giving notice in writing to the Company or to such other person
(including, for the avoidance of doubt, the Trustee), as the Company may direct in the prescribed form specifying the number of Shares in respect of which the Option is being exercised and enclosing payment in full of the aggregate Exercise Price of
those Shares together with evidence of closure of the related Savings Contract. The date of exercise shall be the date of receipt by the Company (or such other person as the Company may direct) of the notice of exercise. If the Option is exercised
in respect of some only of the Shares comprised in the Option, the Option in respect of the balance shall thereupon lapse automatically. 
 8.12 This rule
8.12 shall apply to US Taxpayers. Notwithstanding anything to the contrary contained in the Scheme, an Option Holder who is a US Taxpayer may only exercise an Option within the shorter of any exercise period specified in the rules of this Scheme and
the expiry of two and a half calendar months after the end of the Tax Year in which the Option is no longer subject to a substantial risk of forfeiture. 

  
 27|34 

	9.	 TAKE-OVER AND LIQUIDATION

 9.1 This rule 9 applies if: 
  

	(a)	 any person (either alone or together with any person acting in concert with him) obtains Control of the Company
as a result of making: 

  

	 	(i)	 a general offer to acquire the whole of the issued ordinary share capital of the Company which is made on a
condition such that if it is satisfied, the person making the offer will have Control of the Company; or 

  

	 	(ii)	 a general offer to acquire all of the Shares; 

 

	(b)	 any person (either alone or together with any person acting in concert with him) proposes to obtain Control of
the Company in pursuance of a compromise or arrangement sanctioned by the Court under Article 125 of the Companies (Jersey) Law 1991 (to the extent that it is equivalent to section 899 of the Companies Act 2006) applicable to or affecting:

  

	 	(i)	 all the ordinary share capital of the Company or all the shares in the Company which are of the same class as
the shares which may be acquired by exercise of Options; or 

  

	 	(ii)	 all the shares, or all the shares of that same class, which are held by a class of shareholders identified
otherwise than by reference to their employment or directorships or their participation in a Schedule 3 SAYE Option Scheme; 

  

	(c)	 any person (either alone or together with any person acting in concert with him) becomes bound or entitled to
acquire Shares in the Company under Part 18 of the Companies (Jersey) Law 1991 (to the extent that it is equivalent to sections 979 to 982 (inclusive) or sections 983 to 985 (inclusive) of the Companies Act 2006); 

 

	(d)	 notice is given of a resolution for the voluntary winding-up of the
Company; or 

  

	(e)	 any person (either alone or together with any person acting in concert with him) obtains Control of the Company
as a result of a Non-UK Company Reorganisation Arrangement which becomes binding on the shareholders covered by it, 

(each a Relevant Event). 
 9.2 Where
this rule 9 applies and subject to rules 9.3 and 10 below, all outstanding Options may be exercised within six months of the Relevant Date (whether or not the Relevant Event occurs before or within six months of the Bonus Date) provided that an
Option may not be exercised more than six months after the relevant Bonus Date. Where this rule 9 applies, any outstanding Options that are not exercised (including as a result of the application of rule 9.3) within six months of the Relevant Date
shall lapse automatically and any savings under the relevant Savings Contract relating to such Options shall be returned to the Option Holder save that in the case of any Option which has become exercisable under rule 8.5, such Option shall not
lapse under this rule 9.2 on the expiry of the six month period following any of the Relevant Events mentioned in rule 9.1(a), (b), (c) or (e) but shall lapse only on the expiry of the relevant 12 month period under rule 8.5. For the avoidance
of doubt, any such Option may lapse on the expiry of the six month period arising under rule 9.1(d) even if this occurs before the expiry of the relevant 12 month period under rule 8.5. 

  
 28|34 

 9.3 Without prejudice to the operation of rule 10, Options shall not be exercisable under the foregoing
provisions of this rule 9 if the purpose and effect of the Relevant Event, together with any associated transactions, is to create a new holding company for the Company, such company having substantially the same shareholders and proportionate
shareholdings as those of the Company immediately prior to the Relevant Event. 
 9.4 For the purposes of rule 9.1(a): 

 

	(a)	 the reference to the issued ordinary share capital of the Company does not include any capital already held by
the person making the offer or a person connected with that person; 

  

	(b)	 the reference to Shares in the Company does not include any Shares already held by the person making the offer
or a person connected with that person; and 

  

	(c)	 the general offer referred to in that rule may be made to different shareholders by different means.

 9.5 Notwithstanding any provision to the contrary, where this Rule 9 applies or is expected to apply, and in consequence of a Relevant
Event mentioned in rule 9.1(a), (b), (c), or (e), the Shares that may be acquired on the exercise of an Option no longer meet, or are not expected to meet, the requirements of paragraphs 17 to 20 (inclusive) and 22 of Part 4 of Schedule 3 the Board
may determine that Options may be exercised within a period of 20 days ending on the Relevant Event (conditional upon and with effect from that Relevant Event occurring) or a period of 20 days after the Relevant Event. The Board shall act fairly and
reasonably in exercising its discretion under this rule. 
  

	10.	 OPTION ROLLOVER 

10.1 If any company (the acquiring company): 
  

	(a)	 obtains Control of the Company as a result of making: 

 

	 	(i)	 a general offer to acquire the whole of the issued ordinary share capital of the Company which is made on a
condition such that if it is satisfied the acquiring company will have Control of the Company; or 

  

	 	(ii)	 a general offer to acquire all the Shares; or 

 

	(b)	 obtains Control of the Company in pursuance of a compromise or arrangement sanctioned by the Court under
Article 125 of the Companies (Jersey) Law 1991 (to the extent that it is equivalent to section 899 of the Companies Act 2006); or 

  

	(c)	 becomes bound or entitled to acquire shares in the Company under Part 18 of the Companies (Jersey) Law 1991 (to
the extent that it is equivalent to sections 979 to 982 (inclusive) or sections 983 to 985 (inclusive) of the Companies Act 2006); or 

  
 29|34 

	(d)	 obtains Control of the Company as a result of a Non-UK Company
Reorganisation Arrangement which has become binding on the shareholders covered by it, 

 and notice of a replacement option is given
(with the consent of the acquiring company), then, within six months of the Relevant Date, each Option Holder may release any Option granted under this Appendix A which has not lapsed (the old option) in
consideration of the grant to him of an option (the new option) which (for the purposes of paragraph 39 of Schedule 3) is equivalent to the old option but relates to shares (which comply with the conditions in paragraphs 18 to 20
(inclusive) and 22 of Schedule 3) in a different company (whether the acquiring company itself or another company falling within paragraph 18(b) or (c) of Schedule 3) (the new grantor). 

10.2 The new option shall not be regarded for the purposes of rule 10.1 as equivalent to the old option unless the conditions set out in paragraph 39(4) of
Schedule 3 are satisfied and, in relation to the new option, the provisions of this Appendix A shall be construed as if: 
  

	(a)	 the new option were an option granted under this Appendix A at the same time as the old option;

  

	(b)	 references to the Company in the rules were references to the new grantor provided that references to
Participating Company shall continue to be construed as if references to the Company within this definition were to Ferguson plc (with company number 128484); 

 

	(c)	 references to the Board in the rules were references to the board of directors of the new grantor;

  

	(d)	 references to Shares were references to shares in the new grantor; 

 

	(e)	 the Savings Contract entered into in connection with the old option had been made in connection with the new
option; and 

  

	(f)	 the Bonus Date in relation to the new option was the same as that in relation to the old option.

 10.3 For the purposes of Rule 10.1(a): 
  

	(a)	 the reference to the issued ordinary share capital of the Company does not include any capital already held by
the person making the offer or a person connected with that person; 

  

	(b)	 the reference to Shares in the Company does not include any Shares already held by the person making the offer
or a person connected with that person; and 

  

	(c)	 the general offer referred to in that rule may be made to different shareholders by different means.

  
 30|34 

	11.	 ADJUSTMENT OF OPTIONS 

11.1 In the event of any Capital Reorganisation, the Exercise Price, the description (but not the class) of Shares and the number of Shares comprised in
an Option may be adjusted in such manner as the Board may determine: Provided that: 
  

	(a)	 no adjustment shall take effect unless the total Market Value of the Shares subject to any Option is
immediately after the adjustment or adjustments substantially the same as what it was immediately before the adjustment or adjustments and the aggregate Exercise Price of such Option is immediately after the adjustment or adjustments substantially
the same as what it was immediately before the adjustment or adjustments; 

  

	(b)	 no adjustment shall be made pursuant to this rule which would increase the aggregate Exercise Price of any
Option; and 

  

	(c)	 no adjustment may have the effect of reducing the Exercise Price to less than the nominal value of a Share.

 11.2 Any adjustment to Options made pursuant to this rule 11 shall be notified to the relevant Option Holder. 

 

	12.	 ALLOTMENT OR TRANSFER OF SHARES
ON EXERCISE OF OPTIONS 

 Subject to any necessary consents, to payment
being made for the Shares and to compliance by the Option Holder with the terms of this Appendix A, not later than 30 days after receipt of any notice of exercise in accordance with rule 8, the Company shall either allot and issue or procure
the transfer of Shares to the Option Holder (or to his nominee). The Company shall or, if applicable, shall procure that the Trustee shall (unless the Shares are to be issued in uncertificated form), as soon as practicable, deliver to the Option
Holder (or such nominee) a definitive share certificate or other evidence of title in respect of such Shares. Where the Shares are issued or transferred to a nominee of the Option Holder, the Option Holder shall remain the beneficial owner of the
Shares. 
  

	13.	 RIGHTS ATTACHING TO SHARES
ALLOTTED OR TRANSFERRED PURSUANT TO OPTIONS 

13.1 All Shares allotted or transferred upon the exercise of an Option shall rank pari passu in all respects with the Shares in issue at the date of
exercise save as regards any rights attaching to such Shares by reference to a record date prior to the date of exercise. 
 13.2 Any Shares acquired on the
exercise of Options shall be subject to the articles of association of the Company from time to time in force. 
  

	14.	 AVAILABILITY OF SHARES 

14.1 The Company shall at all times keep available for issue sufficient authorised but unissued Shares to permit the exercise of all unexercised Options under
which Shares may be allotted or shall otherwise procure that Shares are available for transfer in satisfaction of the exercise of Options. 
 14.2 If and so
long as the Shares are admitted to listing by the Financial Conduct Authority and admitted to trading on the London Stock Exchange, the Company will, at its expense, apply to the Financial Conduct Authority and to the London Stock Exchange for
admission to the Official List (unless listing has already been granted) and for trading, respectively, of Shares allotted on the exercise of any Option. 

  
 31|34 

	15.	 ADMINISTRATION AND AMENDMENT 

The decision of the Board shall be final and binding in all matters relating to this Appendix A and it may at any time discontinue the grant of further Options
or amend any of the provisions of this Appendix A in any way it thinks fit: Provided that: 
  

	(a)	 if an alteration or addition is made to a key feature (within the meaning of paragraph 40B(8) of Schedule 3) of
this Appendix A at a time when it is a Schedule 3 SAYE Option Scheme and if such status is to be maintained, it shall not have effect if it would result in the requirements of Parts 2 to 7 of Schedule 3 to the Act not being met in relation to the
Scheme. If such status is not to be maintained, the first sentence of this rule 15(a) shall not apply. The Company shall provide such information and make such declarations in relation to any amendment to a key feature as is required for the
purposes of Schedule 3; 

  

	(b)	 except as herein provided, the Board shall not make any amendment that would materially prejudice the interests
of existing Option Holders except with the prior consent or sanction of the Option Holders who, if they exercised their Options in full, would thereby become entitled to a majority of all the Shares which would fall to be allotted or transferred
upon exercise in full of all outstanding Options; 

  

	(c)	 no amendment to the advantage of Eligible Employees or Option Holders may be made to: 

 

	 	(i)	 the definition of Eligible Employee; 

 

	 	(ii)	 the limitations on the number of Shares subject to this Appendix A; 

 

	 	(iii)	 the maximum entitlement for any Eligible Employee under this Appendix A; 

 

	 	(iv)	 the basis for determining an Eligible Employee’s entitlement to Shares under this Appendix A;

  

	 	(v)	 the terms of Shares to be provided under this Appendix A; and 

 

	 	(vi)	 the adjustments to Options, under rule 11, in the event of a Capital Reorganisation, 

without the prior approval of the Company in general meeting except in the case of minor amendments to benefit the administration of this
Appendix A, to take account of a change in legislation or to obtain or maintain favourable tax, exchange control or regulatory treatment for Eligible Employees and Option Holders or any member of the Group; 

 

	(d)	 without prejudice to any provision of this Appendix A which provides for the lapse of an Option, the Board may
not cancel an Option unless the Option Holder agrees in writing to such cancellation. 

  
 32|34 

	16.	 TAX 

Any liability of an Option Holder to income tax shall be for the account of the relevant Option Holder. 

 

	17.	 GENERAL 

17.1 Any Participating Company may provide money to the Trustee or any other person to enable them or him to acquire Shares to be held for the purposes of this
Appendix A, or enter into any guarantee or indemnity for those purposes, to the extent not prohibited by applicable law. 
 17.2 Notwithstanding any other
provision of this Appendix A: 
  

	(a)	 this Appendix A shall not form part of any contract of employment between the Company or any Subsidiary and an
Option Holder; 

  

	(b)	 no Eligible Employee has any right to be granted an Option and the fact that an Eligible Employee may have
received invitations to participate in this Appendix A and/or been granted Options under this Appendix A shall not entitle any Eligible Employee to future invitations or grants; 

 

	(c)	 the benefit to an Option Holder of participation in this Appendix A (including, in particular but not by way of
limitation, any Options held by him) shall not form any part of his contractual remuneration or benefits or count as his contractual remuneration or benefits for any purpose; 

 

	(d)	 nothing in this Appendix A shall in any way be construed as imposing upon any member of the Group a contractual
obligation as between the member of the Group and an Option Holder to contribute to this Appendix A; and 

  

	(e)	 if an Option Holder ceases to be employed within the Group, he shall not be entitled to compensation for the
loss of any right or benefit or prospective right or benefit under this Appendix A (including, in particular but not by way of limitation, any Options held by him which lapse by reason of his ceasing to be employed within the Group whether lawfully
or unlawfully) whether by way of damages for unfair dismissal, wrongful dismissal, breach of contract or otherwise (or by way of similar provisions of the law of the jurisdiction in which the Option Holder is resident). 

By participating in this Appendix A, an Option Holder is deemed to have agreed to the provisions of this Appendix A and in particular, this
rule 17.2. 
 17.3 The existence of any Option shall not affect in any way the right or power of the Company or its shareholders to make or authorise any or
all adjustments, recapitalisations, reorganisations or other changes in the Company’s capital structure, or any merger or consolidation of the Company, or any issue of shares, bonds, debentures, preferred or prior preference stocks ahead of or
convertible into, or otherwise affecting the Shares or the rights thereof, or the dissolution or liquidation of the Company or any sale or transfer of all or any part of its assets or business, or any other corporate act or proceeding, whether of a
similar character or otherwise. 

  
 33|34 

 17.4 Any notice or other document required to be given under or in connection with this Appendix A may be
delivered to an Option Holder or sent by post to him at his home address according to the records of his employing company or such other address as may appear to the Company to be appropriate. Notices sent by post shall be deemed to have been given
on the day following the date of posting. Any notice or other document required to be given to the Company under or in connection with this Appendix A may be delivered or sent by post to it at its corporate services office at 1020 Eskdale Road,
Winnersh, Wokingham RG41 5TS (or such other place or places as the Board may from time to time determine and notify to Option Holders). 
 17.5 The Company,
or where the Board so directs any Subsidiary, shall pay the appropriate stamp duty on behalf of the Option Holders in respect of any transfer of Shares on the exercise of the Options. 

17.6 Benefits under this Scheme shall not be pensionable. 
 17.7
By accepting the grant of an Option, a Participant acknowledges that the Company or any member of the Group may hold, process and transfer personal data relating to them to other members of the Group or to any third parties engaged by them (whether
within or outside of the European Economic Area (EEA) and that personal data may also be processed outside the EEA by the Company or any member of the Group or by one or more held or of its or their service providers) for any and all
purposes related to the operation and administration of the Plan and/or in order to meet any legal obligation, in each case in accordance with the Company’s Share Plan Data Protection Protocol and applicable law. 

17.8 These rules shall be governed by, and construed in accordance with, the laws of England. Unless specifically stated otherwise, each Option Holder, the
Company and any other Participating Company or Associated Company submits to the exclusive jurisdiction of the English courts in relation to all disputes arising out of or in connection with this Appendix A. 

  
 34|34EX-10.4

 Exhibit 10.4 

 
  

 
 THE FERGUSON
GROUP 
 LONG TERM INCENTIVE PLAN 2019 
  

 

 
 Approved by a
resolution of the Board on 25 April 2019 
 As amended by an ordinary resolution of the shareholders of the Company in a 

general meeting held on 21 November 2019 

Approved by an ordinary resolution of the shareholders of the Company on 

25 April 2019 and amended by resolution of the Board of the Company on 27 January 2021 

 

 CONTENTS 
  

							
	CLAUSE	 	 	  	PAGE	 
	 1.
	 	DEFINITIONS	  	 	1	 
			
	 2.
	 	GRANT OF AWARDS	  	 	5	 
			
	 3.
	 	PERFORMANCE CONDITION	  	 	8	 
			
	 4.
	 	AWARDS WHICH TAKE THE FORM OF A RESTRICTED SHARE AWARD	  	 	8	 
			
	 5.
	 	VESTING OF AWARDS AND HOLDING PERIODS	  	 	9	 
			
	 6.
	 	LEAVERS	  	 	9	 
			
	 7.
	 	MALUS AND CLAWBACK	  	 	10	 
			
	 8.
	 	TAKE-OVER AND LIQUIDATION	  	 	12	 
			
	 9.
	 	ROLLOVER OF AWARDS	  	 	13	 
			
	 10.
	 	CONSEQUENCES OF VESTING	  	 	14	 
			
	 11.
	 	RELATIONSHIP OF PLAN TO CONTRACT OF EMPLOYMENT	  	 	16	 
			
	 12.
	 	ADJUSTMENT OF AWARDS	  	 	17	 
			
	 13.
	 	ADMINISTRATION AND AMENDMENT	  	 	17	 
			
	 14.
	 	DATA PROTECTION	  	 	18	 
			
	 15.
	 	GENERAL	  	 	18	 
		
	 APPENDIX A RULES OF THE FERGUSON GROUP LONG TERM INCENTIVE PLAN 2019 – ELIGIBLE
US EMPLOYEES
	  	 	20	 
			
	 1.
	 	DEFINITIONS	  	 	20	 
			
	 2.
	 	GRANT OF AWARDS	  	 	25	 
			
	 3.
	 	PERFORMANCE CONDITION	  	 	27	 
			
	 4.
	 	AWARDS WHICH TAKE THE FORM OF A RESTRICTED SHARE AWARD	  	 	28	 
			
	 5.
	 	VESTING OF AWARDS AND HOLDING PERIODS	  	 	29	 
			
	 6.
	 	LEAVERS	  	 	29	 
			
	 7.
	 	MALUS AND CLAWBACK	  	 	30	 
			
	 8.
	 	TAKE-OVER AND LIQUIDATION	  	 	31	 
			
	 9.
	 	ROLLOVER OF AWARDS	  	 	32	 
			
	 10.
	 	CONSEQUENCES OF VESTING	  	 	33	 
			
	 11.
	 	RELATIONSHIP OF THIS APPENDIX A TO CONTRACT OF EMPLOYMENT	  	 	36	 
			
	 12.
	 	ADJUSTMENT OF AWARDS	  	 	37	 
			
	 13.
	 	ADMINISTRATION AND AMENDMENT	  	 	37	 

  
 Page I 

							
	 14.
	 	 DATA PROTECTION
	  	 	38	 
			
	 15.
	 	 GENERAL
	  	 	38	 
		
	 SCHEDULE 1 PERFORMANCE CONDITION
	  	 	41	 
		
	 SCHEDULE 2 CALCULATION OF TOTAL SHAREHOLDER RETURN
	  	  
	 45
	  

  

  
 Page II 

 RULES OF THE FERGUSON GROUP 

LONG TERM INCENTIVE PLAN 2019 
  

	1.	 DEFINITIONS 

1.1 In this Plan, unless the context otherwise requires, the following words and expressions shall have the following meanings, namely: 

Adoption Date means 25 April 2019; 

Award means an award granted under rule 2 in the form of an Option, a Restricted Share Award, a Conditional Award or a Phantom Award as the
Committee may determine, which is for the time being subsisting; 
 Award Certificate means the certificate or any other document issued in
respect of the grant of an Award under rule 2.8; 
 Board means the board of directors of the Company; 

Capital Reorganisation means any capitalisation issue, rights issue, sub-division, consolidation or
reduction of capital or any other variation of the share capital of the Company; 
 Committee means the Remuneration Committee of the Board or
some other duly authorised committee of the Board; 
 the Company means the company incorporated in Jersey as Ferguson plc, with registered
number 128484; 
 Control shall have the meaning given to that word by section 995 of the Income Tax Act 2007 (UK); 

Conditional Award means an Award which takes the form of a contingent right to acquire or receive Shares at no or nominal cost; 

the Date of Grant means the date on which the Committee grants an Award; 

DI means a depositary interest representing an ordinary share in the capital of the Company; 

Dividend Equivalents means the payment of a cash sum or delivery of Shares in accordance with rule 10.12; 

DRS statement means the direct registration system statement of account representing certificated ordinary shares listed and traded on the
relevant United States Stock Exchange held on the Company’s share register maintained in the United States; 
 DTC means the Depository
Trust Company, being the system used to settle trades of uncertificated ordinary shares listed and traded on the relevant United States Stock Exchange held on the Company’s share register maintained in the United States; 

Eligible Employee means any employee (including an executive director) of any member of the Group; 

  
 Page 1 

 Employees’ Share Scheme has the meaning given by section 1166
of the Companies Act 2006 (UK); 
 Employer means the Company or any Subsidiary that, with the consent of the Company, participates under this
Plan; 
 Final Value means, in the case of Vested Shares, their aggregate market value calculated by reference to the closing middle-market
quotation of a Share (as derived from the Daily Official List of the London Stock Exchange in the case of a DI priced in Pounds Sterling or from the equivalent such records of the relevant United States Stock Exchange in the case of an ordinary
share in the capital of the Company priced in US Dollars) on the relevant Vesting Date; 
 Financial Year means a financial year of the
Company within the meaning of section 390 of the Companies Act 2006 (UK); 
 Grant Period means the period of 42 days commencing on: 

 

	 	a)	 the Adoption Date; 

  

	 	b)	 the day immediately following the day on which the Company makes an announcement of its results for the last
preceding Financial Year, half year or other period; or 

  

	 	c)	 any day on which the Committee resolves that exceptional circumstances exist which justify the grant of Awards;

 the Group means the Company and its Subsidiaries from time to time and the expression member of the Group
shall be construed accordingly; 
 Holding Period means the period specified in the Company’s share ownership guidelines from time to
time during which the Participant must retain either the Shares which Vest under an Award (including any Shares delivered in satisfaction of Dividend Equivalents) or, in the case of a Vested but unexercised Option, the Option itself; 

Legal Representative means a deceased Participant’s duly appointed legal personal representative, or equivalent representative in
jurisdictions other than the UK, as evidenced by such representative to the satisfaction of the Committee; 
 Listing Rules means the UK
Listing Rules published by the Financial Conduct Authority (as amended from time to time); 
 London Stock Exchange means the London Stock
Exchange Plc or any successor body thereto; 
 Market Abuse Regulation means Regulation (EU) No 596/2014 of the European Parliament and of the
Council of 16 April 2014 on market abuse (or any equivalent or successor legislation); 

  
 Page 2 

 Market Value means in relation to a Share or a Notional Share: 

 

	 	a)	 the closing middle-market quotation for a Share (as derived from the Daily Official List of the London Stock
Exchange in the case of a DI priced in Pounds Sterling or from the equivalent such records of the relevant United States) for the Dealing Day immediately preceding the Date of Grant or, if the Committee so determines the closing middle-market
quotation for a Share (as derived from the Daily Official List of the relevant United States Stock Exchange in the case of an ordinary share in the capital of the Company priced in US Dollars) on the Date of Grant; or 

 

	 	b)	 the average of the closing middle-market quotations during such period as the Committee may determine but not
exceeding 30 dealing days ending with the dealing day immediately preceding the Date of Grant provided that such dealing day(s) fall within a Grant Period; 

NASDAQ means Nasdaq, Inc. or any successor body thereto; 

New York Stock Exchange means New York Stock Exchange, Inc. or any successor body thereto; 

Notional Share means a share equal in value to a Share, but having no legal rights attributable to a Share; 

Old Ferguson means Ferguson Holdings Limited, a company incorporated in Jersey with registered number 106605; 

Option means an Award which takes the form of an option to acquire Shares at either no or nominal cost or at Market Value, to be determined at
the discretion of the Committee; 
 Option Exercise Value means, in relation to an Option, the aggregate market value of the Vested Shares
subject to such Option calculated by reference to the closing middle market quotation of a Share (as derived from the Daily Official List of the London Stock Exchange in the case of a DI priced in Pounds Sterling or from the equivalent such records
of the relevant United States Stock Exchange in the case of an ordinary share in the capital of the Company priced in US Dollars) on the last date of the relevant exercise period less any exercise price payable per Share on the exercise of such
Option, provided that if the calculation produces a negative number, the Option Exercise Value shall be nil; 
 Participant means an Eligible
Employee who has been granted an Award (including, where the context permits, the Legal Representative) which has not lapsed or been surrendered or forfeited; 

Performance Condition means the performance condition or conditions imposed as a condition of the Vesting of an Award under rule 3.1; 

Phantom Award means an Award which takes the form of a right to call for a cash payment calculated by reference to the Final Value of a Notional
Share on the Vesting Date; 
 the Plan means this Ferguson Group Long Term Incentive Plan 2019 as amended from time to time; 

  
 Page 3 

 Relevant Date means: 
  

	 	a)	 if the Relevant Event falls within rule 8.1(a), the date on which Control is obtained and any conditions to
which the offer is made subject are satisfied; 

  

	 	b)	 if the Relevant Event falls within rule 8.1(b), either the date on which the scheme of arrangement is approved
at the shareholders’ meeting or is sanctioned by the Court (as determined by the Committee in its absolute discretion); 

  

	 	c)	 if the Relevant Event falls within rule 8.1(c), the date on which the person first becomes so bound or
entitled; or 

  

	 	d)	 if the Relevant Event falls within rule 8.1(d), the date on which notice of the resolution for winding up is
given; 

 Relevant Event shall have the meaning given to that term in rule 8.1; 

Restricted Shares means Shares subject to a Restricted Share Award which are subject to restrictions in accordance with rule 4; 

Restricted Share Award means an award comprising Restricted Shares; 

Salary means an Eligible Employee’s annual gross basic salary in respect of his employment with the Group on the Date of Grant of an Award
excluding any other benefits or amounts (or if it is expressed in a currency other than sterling, its sterling equivalent calculated on such basis as the Committee may in its discretion determine); 

Scheme of Arrangement means the scheme of arrangement pursuant to Article 125 of the Companies (Jersey) Law 1991, as amended, to introduce the
Company as a new, Jersey-incorporated holding company to the Group; 
 Scheme of Arrangement Effective Date means 10 May 2019 being the
date on which the Scheme of Arrangement became effective in accordance with its terms; 
 Shares means: 

 

	 	a)	 fully paid ordinary shares in the capital of the Company, whether held in certificated or uncertificated form,
via a DRS statement or via the DTC; 

  

	 	b)	 where appropriate the DIs representing such shares; and/or 

 

	 	c)	 shares, or DIs representing those shares or DIs following any reorganisation of the share capital of the
Company; 

 Subsidiary means any subsidiary of the Company within the meaning of section 1159 of, and Schedule 6
to, the UK Companies Act 2006 (or its equivalent under applicable law) over which the Company has Control; 
 Tax Liability means any amount
of tax or social security contributions for which a Participant would or may be liable and for which a member of the Group or former member of the Group would or may be obliged to (or would or may suffer a disadvantage if it were not to) account to
any relevant tax authority; 
 Termination Date means the date on which a Participant ceases to be an employee of a member of the Group and,
for the avoidance of doubt, where the employee dies, shall be taken to mean the date of death; 
 Trustee means the trustee or trustees of any
employee benefit trust established by the Company or any member of the Group; 

  
 Page 4 

 United States Stock Exchange means the New York Stock Exchange, NASDAQ or such other
recognised stock exchange in the United States, on which the Shares are listed; 
 Vest means (i) in the case of an Award granted in the
form of an Option, when the Option becomes exercisable, or (ii) in the case of an Award granted in the form of a Restricted Share Award, when the Restricted Shares cease to be subject to forfeiture, or (iii) in the case of an Award granted
in the form of a Conditional Award, when the Participant becomes entitled to have the Shares which are the subject of the Conditional Award transferred to him, or (iv) in the case of an Award granted in the form of a Phantom Award, a
Participant becoming entitled to call for a cash sum in accordance with rule 10.10, and Vesting and Vested shall be construed accordingly; 

Vesting Date means the date on which an Award (or part thereof) Vests which, save as provided for in these rules, shall not be earlier than the
third anniversary of the Date of Grant; 
 Vesting Period means the period from the Date of Grant to the Vesting Date; and 

Vested Shares means those Shares, Notional Shares or Restricted Shares in respect of which an Award has Vested. 

1.2 Where the context permits the singular shall include the plural and vice versa and the masculine shall include the feminine. 

1.3 References to any act or statutory instrument of UK Parliament or the legislative bodies of Jersey, the United States of America or the European Union (the
EU) shall include any modification, amendment or re-enactment thereof (and shall, in respect of any EU legislation, include any UK legislation enacted in replacement thereof following the
UK’s departure from the EU). 
  

	2.	 GRANT OF AWARDS 

2.1 Subject to the provisions contained in these rules, the Committee may, during a Grant Period, grant Awards to Eligible Employees selected for participation
by the Committee in its discretion on such terms as it shall in its absolute discretion determine. No consideration shall be payable for the grant of an Award. When the Committee grants an Award, it shall decide whether the Award will take the form
of an Option, a Restricted Share Award, a Conditional Award or a Phantom Award. An Eligible Employee may be granted any form of Award or any combination of Awards. 

2.2 Individual Limit. The maximum total Market Value of Shares over which Awards may be granted to any Eligible Employee in respect of any Financial
Year of the Company is 350 per cent. of his Salary. 
 2.3 Method of satisfying Awards. An Award, other than a Phantom Award, may be satisfied by
the issue of Shares, the transfer of Shares from treasury, or by the transfer of Shares purchased on the market including from an employee benefit trust. 

2.4 Scheme Limit. No Award shall be granted under the Plan to the extent that the result of that grant would be that the aggregate number of Shares that
could be issued on the Vesting or, in the case of Options, exercise of that Award and any other Award granted at the same time, when added to the number of Shares that: 
  

	 	(i)	 could be issued on the vesting of any subsisting share awards or the exercise of any options granted during the
preceding ten years under (a) the Plan and (b) any other Employees’ Share Scheme established by the Company or Old Ferguson; and 

  
 Page 5 

	 	(ii)	 have been issued on the vesting of any share awards or the exercise of any options granted during the preceding
ten years under (a) the Plan and (b) any other Employees’ Share Scheme established by the Company or Old Ferguson, 

 would
exceed 10 per cent. of the ordinary share capital of the Company for the time being in issue. 
 2.5 No Award shall be granted under the Plan to the
extent that the result of that grant would be that the aggregate number of Shares that could be issued on the Vesting or, in the case of Options, exercise of that Award and any other Award granted at the same time, when added to the number of Shares
that: 
  

	 	(i)	 could be issued on the vesting of any subsisting share awards or the exercise of any options granted during the
preceding ten years under (a) the Plan and (b) any other discretionary share scheme established by the Company or Old Ferguson; and 

  

	 	(ii)	 have been issued on the vesting of any share awards or the exercise of any options granted during the preceding
ten years under (a) the Plan and (b) any other discretionary share scheme established by the Company or Old Ferguson, 

 would
exceed 5 per cent. of the ordinary share capital of the Company for the time being in issue. 
 2.6 Reference in this rule 2 to the issue of Shares
shall, for the avoidance of doubt, mean the issue and allotment (but not transfer) of Shares. The delivery of Shares from treasury shall also count towards the percentage limits set out in rules 2.4 and 2.5 above for so long as institutional
shareholder guidelines recommend this. 
 2.7 In determining the above limits no account shall be taken of any Shares attributable to an Award which was
released, lapsed or otherwise became incapable of Vesting. 
 2.8 Award Certificate. The Committee may, in its absolute discretion, enter into a deed
poll recording its intention to grant Awards and agreeing to be bound by the Award Certificates issued pursuant to this rule 2.8. As soon as reasonably practicable following the Date of Grant, the Committee shall procure the issue of an Award
Certificate in respect of the Award and send it to the Participant. If the Committee has not entered into a deed poll prior to the granting of the Awards, the Committee shall procure that the Award Certificates are issued under the seal of the
Company or otherwise to take effect as a deed. An Award Certificate shall state: 
 2.8.1 whether the Award will take the form of an Option, a Restricted
Share Award, a Conditional Award or a Phantom Award; 
 2.8.2 if the Award is granted subject to the terms of Appendix A – the U.S. Rules; 

  
 Page 6 

 2.8.3 the name of the Eligible Employee receiving the Award; 

2.8.4 the Date of Grant of the Award; 
 2.8.5 whether an Award
will be granted in respect of ordinary shares or DIs; 
 2.8.6 the number of Shares or Restricted Shares (or, in the case of an Award granted in the form of
a Phantom Award, Notional Shares) comprised in the Award; 
 2.8.7 the exercise price payable by the Participant on exercise of the Award (if any); 

2.8.8 the Vesting Date or Dates which shall not be later than the tenth anniversary of the Date of Grant; 

2.8.9 if more than one Vesting Date is specified, the number or proportion of the Shares comprised in an Award which will ordinarily Vest on each of the
specified Vesting Dates; 
 2.8.10 the Performance Condition applicable to the Award; 

2.8.11 whether Dividend Equivalents should be paid in respect of an Award; 

2.8.12 whether the Participant has an obligation to enter into an agreement, election or arrangement including, without limitation, pursuant to rule 10.14;

 2.8.13 details of the Holding Period that shall apply to the Award; and 

2.8.14 details of the clawback and malus terms that apply to an Award. 

The Committee may require a Participant to sign and return within a specified period a copy of the Award Certificate or other document acknowledging his
agreement to be bound by the terms of the Plan and may determine that a Participant’s failure to do so within the specified period shall cause the Award to lapse and shall be treated as if it had never been granted. 

Subject thereto, an Award Certificate shall be in such form as the Committee may determine from time to time. 

2.9 Duration of Plan. An Award may not be granted: 
 2.9.1
earlier than the Adoption Date; nor 
 2.9.2 later than the tenth anniversary of the Adoption Date. 

2.10 Non-transferability and bankruptcy. An Award shall be personal to a Participant and shall not (except to
the extent necessary to enable a Legal Representative to realise the Award following the death of a Participant) be capable of being transferred, charged or otherwise alienated and shall lapse immediately if the Participant purports to transfer,
charge or otherwise alienate the Award or if he is declared bankrupt. 
 2.11 Right to Renounce Awards. A Participant may, by notice in writing to the
Company within thirty days after the Date of Grant, renounce (in whole but not in part) his rights under the Award. In such a case, the Award shall to that extent be treated, for the purpose of the Plan, as never having been granted. No
consideration shall be due for any such renunciation. 

  
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 2.12 Approvals and consents. The grant of an Award shall be subject to obtaining any approval or
consent required under the Listing Rules, the Market Abuse Regulation or any relevant share dealing code of the Company, the City Code on Takeovers and Mergers and any other UK or overseas regulation or enactment related to the grant of Awards to
Eligible Employees in the jurisdictions in which they are resident. 
 2.13 Overseas Countries. The Committee may adopt Appendices setting out
specific requirements or terms in relation to Awards granted to Eligible Employees in particular countries if that is necessary or desirable to take account of local tax, exchange control or securities laws in such countries. 

 

	3.	 PERFORMANCE CONDITION 

3.1 The Committee shall impose Performance Conditions which must be satisfied in order for an Award to Vest. Unless the Committee determines otherwise, the
Performance Conditions set out in Schedule 1 to this Plan shall apply. 
 3.2 The Committee can set different Performance Conditions for Awards granted in
different years (in terms of the type of condition, the weighting given to that condition and the targets applicable to each condition) provided that, in the reasonable opinion of the Committee, the Performance Conditions for Awards granted in one
year is not materially less challenging than the Performance Conditions for Awards granted in any other year. 
 3.3 The Committee may vary the Performance
Conditions applying to existing Awards if an event occurs or there are circumstances (for example, an acquisition or disposal of a business or a significant part of a business) such that the condition is no longer a fair measure of performance
provided that, in the reasonable opinion of the Committee, the new condition is not materially less challenging than the original condition would have been but for the event or circumstances in question. 

3.4 The Committee shall, as soon as reasonably practicable, notify a Participant of any substitution or variation of the Performance Conditions. 

 

	4.	 AWARDS WHICH TAKE THE FORM
OF A RESTRICTED SHARE AWARD 

 4.1 If an Award takes the
form of a Restricted Share Award, the Restricted Shares subject to the Award shall, except to the extent that the Award has Vested, be subject to such restrictions on the transfer, assignment, sale, pledge, charge or other disposal of the Restricted
Shares during the Vesting Period as the Committee may prescribe and an Eligible Employee may be required to enter into an irrevocable agreement with the Company and, if necessary, the Eligible Employee’s Employer, in such form as the Committee
may prescribe which may include an agreement by the Eligible Employee: 
  

	(a)	 not to transfer, assign, sell, pledge, charge or otherwise dispose of any Restricted Shares subject to the
Award except to the extent that the Award has Vested; and 

  

	(b)	 to transfer (or procure the transfer) to or to the order of the Company, for a total of one penny (or the
equivalent in a Participant’s local currency), all the Restricted Shares in respect of which the Award does not Vest. 

  
 Page 8 

 4.2 If the Eligible Employee does not enter into any required agreement either before the Date of Grant or
within such period after the Date of Grant as the Committee may specify, the Award shall not be granted or if it has been granted, such grant shall be ineffective. 

4.3 On or before the Date of Grant for an Award which takes the form of a Restricted Share Award, the Company shall transfer or procure the transfer to the
Participant or his nominee or such other person as the Committee may determine the number of Restricted Shares which are subject to the Award. 
 4.4 To the
extent that an Award which takes the form of a Restricted Share Award Vests, any restrictions referred to in rule 4.1 shall cease to have effect in relation to the Shares subject to that Award. 

4.5 Notwithstanding that the Award has not Vested, a Participant shall be entitled to receive any dividends paid on Restricted Shares in the period between the
Date of Grant and the Vesting Date. 
  

	5.	 VESTING OF AWARDS AND HOLDING
PERIODS 

 5.1 Timing of Vesting. Subject to rules 6, 7, 8 and the satisfaction of the Performance Condition, an
Award (or part thereof) shall Vest on the Vesting Date. 
 5.2 Holding Period. A Participant shall take such steps as the Committee may reasonably
require to satisfy the Committee as to the Participant’s observance of the Holding Period. For the avoidance of doubt, in circumstances where Participants are offered and accept a replacement Award in accordance with Rule 9, the new award (as
defined in rule 9.1) shall be subject to the Holding Period at such time as it Vests. 
  

	6.	 LEAVERS 

6.1 Death. If a Participant dies, Awards granted to him will Vest on the Termination Date in accordance with rule 6.4. 

6.2 Other Leavers. Where a Participant ceases to be an Eligible Employee at any time before the Vesting Date applicable to his Award by reason of: 

 

	(a)	 redundancy; 

  

	(b)	 injury, disability or ill-health (evidenced to the satisfaction of the
Committee); 

  

	(c)	 his employing company ceasing to be under the Control of the Company; 

 

	(d)	 the business (or part of a business) in which he is employed being transferred to a person who is not a member
of the Group, or 

  

	(e)	 any other reason at the discretion of the Committee, 

his Award shall continue, and will Vest on the original Vesting Date in accordance with rule 6.3, save that the Committee may determine that an Award shall
instead Vest on the Termination Date in accordance with rule 6.4. Where an Award is subject to more than one Performance Condition, the Committee may treat each discrete part of the Award that is subject to a particular Performance Condition as a
separate Award with the result that the Committee may determine that part of an Award shall continue and Vest on the original Vesting Date in accordance with rule 6.3 and that part of an Award shall Vest on the Termination Date. 

  
 Page 9 

 6.3 Delayed Vesting. Where, by reason of rule 6.2, an Award Vests in accordance with this rule 6.3,
the number of Vested Shares shall be determined by the Committee by reference to: 
  

	(a)	 the application of the Performance Condition at the original Vesting Date; and 

 

	(b)	 multiplying the resulting number of Shares, Notional Shares or Restricted Shares by the fraction A/B
(where A is the number of complete months from the Date of Grant to the Termination Date and which shall not be greater than the total number of months in the Vesting Period and B is 36 or such other number as is
equal to the number of months in the Vesting Period), save that the Committee may, in its absolute discretion, disapply in whole or in part the application of the time pro-rating fraction.

 6.4 Immediate Vesting. Where, by reason of rule 6.1 or rule 6.2, an Award Vests in accordance with this rule 6.4 the number of
Vested Shares shall be determined by the Committee by reference to: 
  

	(a)	 the application of the Performance Condition at the Termination Date, or at such other date (whether later or
earlier) within a period of one month of the Termination Date on which data is available in the ordinary course to allow the testing of Performance Conditions; and 

 

	(b)	 multiplying the resulting number of Shares, Notional Shares or Restricted Shares by the fraction A/B
(where A is the number of complete months from the Date of Grant until the Termination Date and which shall not be greater than the total number of months in the Vesting Period and B is 36 or equal to such other
number of months in the original Vesting Period), save that in any particular case, the Committee may, in its absolute discretion, disapply in whole or in part the application of the time pro-rating fraction.

 6.5 If a Participant ceases employment in any circumstances other than those described at rules 6.1 or 6.2, his unvested Awards shall
lapse automatically on the Termination Date. 
 6.6 Meaning of ceasing employment. For the purposes of this rule 6, a Participant shall not be treated
as ceasing to be an Eligible Employee until he ceases to be employed by or hold office with the Company or any member of the Group. The reason for the termination of employment of a Participant shall be determined by reference to rule 6.1 and 6.2
regardless of whether such termination was lawful or unlawful (and howsoever caused). 
  

	7.	 MALUS AND CLAWBACK 

7.1 Notwithstanding any other rule of the Plan, if one or more of the circumstances set out in rule 7.2 occur, the Committee may: (a) at any time, (where
the circumstances fall within rule 7.2.4 below); or (b) prior to the fifth anniversary of the Date of Grant in all other circumstances, determine (acting fairly and reasonably having taken into account the scale of loss or damage to the Company
or the extent of the risk taken by the Company) to take one or more of the following actions in relation to any one or more Participants: 
 7.1.1 reduce
(including to nil) the number of Shares, Notional Shares or Restricted Shares in respect of which any future Award is granted to a Participant; or 

  
 Page 10 

 7.1.2 reduce (including to nil) the cash amount payable under an unvested Award held by a Participant or the
number of Shares, Notional Shares or Restricted Shares under an unvested Award and/or the number of Shares and/or Dividend Equivalents under a Vested but unexercised Option held by a Participant, by such amount and/or such number as the Committee
considers appropriate in the circumstances; or 
 7.1.3 in relation to a Vested Award, require a Participant to pay to the Company or such other person as
the Company may direct within 30 days of a written demand from the Company such number of Shares or such monetary amount with a value to be determined in the Committee’s absolute discretion provided such value on the date of demand is no
greater than the value of the Vested Shares and Dividend Equivalents under Award at the Vesting Date, less any amount paid by or in respect of the Participant in respect of a Tax Liability incurred as a result of the Vesting of the relevant Award
(except to the extent the Participant is able to recover amounts paid in respect of such Tax Liability). 
 7.2 The circumstances in which the Committee may
consider that it is appropriate to exercise its discretion under rule 7.1 are the following: 
 7.2.1 a material financial misstatement of the Company’s
audited financial accounts (other than as a result of a change in accounting practice); 
 7.2.2 conduct by a Participant which results in or is reasonably
likely to result in significant reputational damage to the Company; 
 7.2.3 the negligence or gross misconduct of a Participant; or 

7.2.4 fraud effected by or with the knowledge of a Participant. 

7.3 If the Committee decides to exercise its discretion under this rule 7, it shall confirm this in writing to each affected Participant. 

7.4 For the purposes of these rules, if the Committee decides to exercise its discretion under Rule 7.1.2 before an Award Vests: 

7.4.1 the Award shall be deemed to have been granted over the reduced number of Shares, Notional Shares or Restricted Shares (as the case may be); and 

7.4.2 any subsequent Vesting of the Award shall be determined by reference to this reduced number of Shares, Notional Shares or Restricted Shares, 

save that if the number of Shares, Notional Shares or Restricted Shares is reduced to nil, the Award shall be treated as if it had never been granted and such
Participant (including a Participant who has left employment before the Vesting Date) shall have no rights to any cash amount, Dividend Equivalents, Shares, Notional Shares or Restricted Shares. 

  
 Page 11 

	8.	 TAKE-OVER AND LIQUIDATION

 8.1 This rule 8 applies if: 
  

	(a)	 any person (either alone or together with any person acting in concert with him) obtains Control of the Company
as a result of making: 

  

	 	(i)	 a general offer to acquire the whole of the issued ordinary share capital of the Company which is made on a
condition such that if it is satisfied, the person making the offer will have Control of the Company; or 

  

	 	(ii)	 a general offer to acquire all of the Shares; 

 

	(b)	 any person proposes to obtain Control of the Company in pursuance of a compromise or arrangement sanctioned by
the Court under Article 125 of the Companies (Jersey) Law 1991 or its equivalent under applicable law; 

  

	(c)	 any person becomes bound or entitled to acquire Shares in the Company under Part 18 of the Companies (Jersey)
Law 1991 or its equivalent under applicable law; or 

  

	(d)	 notice is given of a resolution for the voluntary or compulsory
winding-up of the Company, 

 (each a Relevant Event). 

8.2 Where this rule 8 applies and subject to rules 8.3, 8.4 and 9 below, all outstanding Awards will automatically Vest and, in the case of an Award granted in
the form of an Option shall be automatically exercised on the Relevant Date provided that any exercise price payable by the Participant on exercise is equal to or less than the relevant offer price or consideration (as determined by the Committee).
Where this rule 8 applies, and subject to rules 8.3, 8.4 and 9 below, any outstanding Awards granted in the form of Options that are not exercised on the Relevant Date shall lapse automatically. 

8.3 Proportion of Award that Vests. The number of Shares in respect of which the Award Vests shall be determined by the Committee by reference to: 

 

	(a)	 the application of the Performance Condition at the Relevant Date; and 

 

	(b)	 multiplying the resulting number of Shares, Notional Shares or Restricted Shares by the fraction A/B
(where A is the number of complete months from the Date of Grant until the Relevant Event and which shall not be greater than the total number of months in the Vesting Period and B is 36 or equal to such other
number of months in the original Vesting Period), save that in any particular case, the Committee may, in its absolute discretion, disapply, in whole or in part, the application of the time pro-rating
fraction. 

 8.4 Without prejudice to the operation of rule 9, Awards shall not Vest or be exercised without the consent of the Committee
under the foregoing provisions of this rule 8 if the purpose and effect of the Relevant Event, together with any associated transactions, is to create a new holding company for the Company, such company having substantially the same shareholders and
proportionate shareholdings as those of the Company immediately prior to the Relevant Event. Unless the Committee determines otherwise in its absolute discretion, an Award will in such circumstances be exchanged for an equivalent award in accordance
with rule 9 below and notice of a replacement award shall be issued to each affected Participant accordingly. 

  
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	9.	 ROLLOVER OF AWARDS 

9.1 If any other business entity (the acquiring company): 
  

	(a)	 obtains Control of the Company as a result of making: 

 

	 	(i)	 a general offer to acquire the whole of the issued ordinary share capital of the Company which is made on a
condition such that if it is satisfied the acquiring company will have Control of the Company; or 

  

	 	(ii)	 a general offer to acquire all the Shares; or 

 

	(b)	 proposes to obtain Control of the Company in pursuance of a compromise or arrangement sanctioned by the Court
under Article 125 of the Companies (Jersey) Law 1991 or its equivalent under applicable law; or 

  

	(c)	 becomes bound or entitled to acquire shares in the Company under Part 18 of the Companies (Jersey) Law 1991 or
their equivalent under applicable law, 

 and the acquiring company notifies Participants of an offer of a replacement Award, then, on the
Relevant Date, for any Award which has not lapsed (the old award) a Participant may elect to release and accept in consideration of that release an award (the new award) which (in the opinion of the Committee) is
equivalent to the old award but relates to shares in a different company (whether the acquiring company itself or another company) (the new grantor). 

9.2 The provisions of the Plan shall be construed as if: 
  

	(a)	 the new award were an award granted under the Plan at the same time as the old award; 

 

	(b)	 references to the Company in the rules were references to the new grantor; 

 

	(c)	 references to the Committee in the rules were references to the board of directors of the new grantor or any
duly authorised committee thereof; 

  

	(d)	 references to Shares were references to shares in the new grantor; and 

 

	(e)	 the Vesting Date in relation to the new award was the same as that in relation to the old award.

 9.3 The Committee may make such adjustments to the Performance Condition applicable to the new award as it, in its absolute discretion,
considers appropriate. 
 9.4 Subject to rule 8.4, if notice is given by an acquiring company under rule 9.1 and a Participant does not elect to release an
old award and accept in consideration for that release a new award, the old award will vest and be exercised in accordance with rule 8.2. 

  
 Page 13 

	10.	 CONSEQUENCES OF VESTING 

10.1 Options. On the Vesting of an Award which takes the form of an Option the Participant may, subject to any shorter period imposed pursuant to the
Plan or the Award Certificate, exercise the Option over some or all of the Vested Shares during the period to the tenth anniversary of the Date of Grant. 

10.2 If the Award has Vested due to a Participant’s death or if the Participant dies during the exercise period specified in rule 10.1 above, the Award
may be exercised by the Legal Representative during the period of 12 months following the date of death. 
 10.3 If the Award has Vested in accordance
with rules 6.2 or 8.2, the Award may be exercised during the period of 6 months following the Vesting Date. 
 10.4 If a Participant ceases employment
in any circumstances other than those described at rules 6.1 or 6.2, his Awards may be exercised in respect of Vested Shares during the period of three months following the Termination Date. 

10.5 If, during the period in which an Option may otherwise be exercised under these rules, the Participant is subject to any dealing restrictions under the
Listing Rules, the Market Abuse Regulation or any relevant share dealing code of the Company, the applicable period shall be suspended until such later date as those dealing restrictions lift provided that no Option may be exercised more than
10 years after its Date of Grant. Subject to rules 10.11, 10.12, 10.15 and any arrangements to give effect to the Holding Period in accordance with rule 5.2, the Company shall procure the issue or transfer of the Vested Shares to the
Participant (or his nominee) as soon as reasonably practicable after the exercise date and in any event not later than 30 days thereafter. 
 10.6 If a
Participant has not exercised his Option before the end of the relevant period mentioned in rules 10.1 to 10.4, the following provisions shall apply: 
  

	(a)	 if the exercise price payable by the Participant is nil, the Option shall be deemed to have been exercised on
the last day of the relevant period; or 

  

	(b)	 subject to (a) above, the Option shall be settled by the Committee making a payment of (or procuring the
payment of) a cash sum to the Participant equal to any Option Exercise Value, subject to such deductions for any Tax Liability required by applicable law. The Committee may in its discretion pay or procure the payment of any cash sum in sterling or
the equivalent in a Participant’s local currency (converted on the basis of such exchange rate as the Committee may in its discretion determine). 

10.7 The Participant may exercise a Vested Option by written notice to the Company in such form as the Committee may prescribe. 

10.8 Conditional Awards. On the Vesting of an Award which takes the form of a Conditional Award a Participant need take no action and the Company shall,
subject to rules 10.11, 10.12, 10.15 and any arrangements to give effect to the Holding Period in accordance with rule 5.2, procure the issue or transfer of the Vested Shares to the Participant (or his nominee) as soon as reasonably practicable
after the Vesting Date and in any event no later than 30 days thereafter. If the Award has Vested due to a Participant’s death or if the Participant dies during the 30 day period the Shares shall be issued or transferred to the Legal
Representative as soon as reasonably practicable after the date of death. 

  
 Page 14 

 10.9 Restricted Share Awards. On the Vesting of an Award which takes the form of a Restricted Share
Award the Shares shall cease to be subject to all restrictions and any agreement applying to the Restricted Shares shall cease to have effect. For the avoidance of doubt, the Participant shall be required to comply with arrangements in respect of
such Shares to give effect to the Holding Period in accordance with rule 5.2. 
 10.10 Phantom Awards. On the Vesting of an Award which takes the
form of a Phantom Award, the Committee shall pay, or procure the payment of, a cash sum to the Participant equal to the Final Value of the Vested Notional Shares to which the Phantom Award relates subject to such deductions for any Tax Liability as
are required by applicable law. The Committee may in its discretion pay or procure payment of the cash sum in sterling or the equivalent in a Participant’s local currency (converted on the basis of such exchange rate as the Committee may in its
discretion determine). The cash sum will be paid as soon as reasonably practicable following the Vesting Date. 
 10.11 Restrictions on Vesting. An
Award shall not Vest unless and until the issue or transfer of Shares (if relevant) after such Vesting would be lawful in all relevant jurisdictions and in compliance with the Listing Rules, any relevant share dealing code of the Company, the City
Code on Takeovers and Mergers and any other relevant UK or overseas regulation or enactment related to the Vesting of an Award in the jurisdictions in which the relevant Participant is resident for tax purposes. 

10.12 Dividend Equivalents. Where the Committee has at the Date of Grant determined that Dividend Equivalents shall be paid, within the period of
30 days following the Vesting Date, the Company shall either: 
  

	(a)	 pay the Participant a cash sum, or 

 

	(b)	 issue or transfer Shares to the Participant, 

in either case having a value equal to the sum of the dividends that the Participant would have received had the Participant held Vested Shares throughout the
period between the Date of Grant and the Vesting Date. An amount equivalent to the Tax Liability may be deducted from such payment or delivery of Shares. This rule shall not apply in respect of any super dividend, dividend in specie or other
distribution paid by the Company (each being a Distribution) which would otherwise materially affect the value of an Award and for which an Award is adjusted pursuant to rule 12. For the purpose of this rule 10.12 and rule 12, a
Distribution shall not materially affect the value of an Award or attract dividend equivalents if the Company undertakes a share consolidation in conjunction with the Distribution that has the effect that the Market Value of a Share before and after
the Distribution is substantially equivalent. 
 10.13 Payment of Tax Liability. Any liability of a Participant to taxation or social security
contributions shall be for the account of the relevant Participant and the issue or transfer of Vested Shares subject to a Participant’s Vested Award shall be conditional upon the Participant having discharged the amount required to satisfy the
Tax Liability which arises on Vesting or exercise to the satisfaction of the Company, or otherwise having complied with any arrangements specified by the Company to 

  
 Page 15 

 
secure that such Tax Liability is satisfied including irrevocably authorising the Company to sell or procure the sale of sufficient Vested Shares on or following the Vesting or exercise (as
applicable) of his Award on his behalf to ensure that any relevant member of the Group or former member of the Group receives the amount required to discharge the Tax Liability which arises as a result of the Vesting or exercise of his Award and by
participating in the Plan a Participant is deemed to have given such authorisation. 
 10.14 Elections. A Participant shall enter into any agreement,
election or arrangement which the Committee may consider appropriate within such period as may be specified by the Committee, in relation to or in connection with any liability to income tax or social security contributions (including, if permitted
under local law, any employer’s social security contributions) in respect of the Participant’s Award or the Shares subject to his Award. For example, but without limitation, the Committee may require Participants who are resident in the UK
for tax purposes to enter into an agreement or election pursuant to paragraphs 3A or 3B of Schedule 1 to the UK Social Security Contributions and Benefits Act 1992 or a joint election under Section 431 of the UK Income Tax (Earnings and
Pensions) Act 2003 by the fourteenth day following the acquisition of any Shares by the Participant. 
 10.15 Cash settlement. If for any reason the
Committee considers that it is impractical or legally onerous to deliver Shares in satisfaction of a Vested Award, it may instead pay or procure the payment to the Participant of a cash sum equal to the Final Value of the Vested Shares, subject to
such deductions for any Tax Liability required by applicable law. The Committee may in its discretion pay or procure the payment of any cash sum in sterling or the equivalent in a Participant’s local currency (converted on the basis of such
exchange rate as the Committee may in its discretion determine). 
  

	11.	 RELATIONSHIP OF PLAN TO CONTRACT
OF EMPLOYMENT 

 11.1 The rights and obligations of a Participant under the terms and conditions of
employment shall not be affected by his participation in the Plan or any right he may have to participate in the Plan. An individual who participates in the Plan waives all and any rights to compensation or damages in consequence of the termination
of his employment with any member of the Group (or former member of the Group if applicable) for any reason whatsoever (whether lawfully or unlawfully) insofar as those rights arise, or may arise from his ceasing to have rights under or be entitled
to exercise any Award under the Plan, as a result of such termination or from the loss or diminution in value of such rights or entitlements. In the event of any conflict between the terms of this rule 11 and the Participant’s terms of
employment, this rule shall take precedence. 
 11.2 Notwithstanding any other provision of the Plan: 

11.2.1 the Plan shall not form part of any contract of employment between the Company or any Subsidiary and a Participant; 

11.2.2 no Eligible Employee has any right to be granted an Award and the fact that an Eligible Employee may have participated in the Plan and/or been granted
an Award under the Plan shall not entitle any Eligible Employee to future participation or grants; 

  
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 11.2.3 the benefit to a Participant of participation in the Plan (including, in particular but not by way of
limitation, any Awards held by him) shall not form any part of his contractual remuneration or benefits or count as his contractual remuneration or benefits for any purpose and shall not be pensionable; 

11.2.4 nothing in the Plan shall in any way be construed as imposing upon any member of the Group a contractual obligation as between the member of the Group
and a Participant to contribute to the Plan; and 
 11.2.5 by accepting the grant of an Award and not renouncing it a Participant is deemed to have agreed to
the provisions of the Plan and in particular, this rule 11.2. 
  

	12.	 ADJUSTMENT OF AWARDS 

12.1 In the event of any Capital Reorganisation (or the implementation by the Company of a demerger or payment of a super dividend, dividend in specie or other
distribution paid by the Company which would otherwise materially affect the value of an Award), the price payable by a Participant on Vesting (or exercise of an Option) (if any), the description of Shares, Notional Shares or Restricted Shares and
the number of Shares, Notional Shares or Restricted Shares comprised in an Award may be adjusted in such manner as the Committee may determine. Any adjustment to Awards made pursuant to this rule 12 shall be notified to the relevant
Participant. 
  

	13.	 ADMINISTRATION AND AMENDMENT 

13.1 Committee responsible for administration. The decision of the Committee shall be final and binding in all matters relating to the Plan and it may
at any time discontinue the grant of further Awards or amend any of the provisions of the Plan in any way it thinks fit, provided that: 
  

	(a)	 except as herein provided, the Committee shall not make any amendment that would materially prejudice the
interests of existing Participants in any jurisdiction in which the Plan operates except with the prior consent or sanction of Participants in that jurisdiction who, if their Awards Vested in full, would thereby become entitled to a majority of all
the Shares which would fall to be transferred upon satisfaction of all outstanding Awards in that jurisdiction; 

  

	(b)	 without prejudice to any provision of the Plan which provides for the lapse of an Award, the Committee may not
cancel an Award unless the Participant agrees in writing to such cancellation; and 

  

	(c)	 no amendment to the advantage of Eligible Employees or Participants may be made to: 

 

	 	(i)	 the definition of Eligible Employee in rule 1.1; 

 

	 	(ii)	 the limitations on the numbers of Shares subject to the Plan; 

 

	 	(iii)	 the maximum entitlement of an Eligible Employee under the Plan; 

 

	 	(iv)	 the basis for determining an Eligible Employee’s entitlement to Shares under the Plan;

  
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	 	(v)	 the terms of Shares to be provided under the Plan; 

 

	 	(vi)	 the adjustment provisions of rule 12 of the Plan; 

without the prior approval of the Company in general meeting except in the case of minor amendments to benefit the administration of the Plan,
to take account of a change in legislation or to obtain or maintain favourable tax, exchange control or regulatory treatment for Eligible Employees and/or Participants or any member of the Group. 

 

	14.	 DATA PROTECTION 

14.1 By accepting the grant of an Award, a Participant acknowledges that the Company or any member of the Group may hold, process and transfer personal data
relating to them to other members of the Group or to any third parties engaged by them (whether within or outside of the European Economic Area (EEA) and that personal data may also be processed outside the EEA by the Company or any
member of the Group or by one or more held or of its or their service providers) for any and all purposes related to the operation and administration of the Plan and/or in order to meet any legal obligation, in each case in accordance with the
Company’s Share Plan Data Protection Protocol and applicable law. 
  

	15.	 GENERAL 

15.1 Any member of the Group may provide money to the Trustee or any other person to enable them or him to acquire (and to subscribe for) Shares to be held for
the purposes of the Plan, or enter into any guarantee or indemnity for those purposes, to the extent not prohibited by applicable law. 
 15.2 The existence
of any Award shall not affect in any way the right or power of the Company or its shareholders to make or authorise any or all adjustments, recapitalisations, reorganisations or other changes in the Company’s capital structure, or any merger or
consolidation of the Company, or any issue of shares, bonds, debentures, preferred or prior preference stocks ahead of or convertible into, or otherwise affecting the Shares or the rights thereof, or the dissolution or liquidation of the Company or
any sale or transfer of all or any part of its assets or business, or any other corporate act or proceeding, whether of a similar character or otherwise. 

15.3 Any notice or other document required to be given under or in connection with the Plan may be delivered to a Participant or sent by post to him at his
home address according to the records of his Employer or such other address as may appear to the Company to be appropriate. Notices sent by post shall be deemed to have been given on the day following the date of posting. Any notice or other
document require to be given to the Company under or in connection with the Plan may be delivered or sent by post to it at its corporate services office at 1020 Eskdale Road, Winnersh, Wokingham RG41 5TS (or such other place or places as the
Committee may from time to time determine and notify to Participants). 
 15.4 The Company, or where the Committee so directs any Subsidiary, shall pay the
appropriate stamp duty on behalf of the Participants in respect of any issue or transfer of Shares on the Vesting or exercise of the Awards. 
 15.5 Benefits
under this Plan shall not be pensionable. 

  
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 15.6 These rules and any contractual and non-contractual obligations
arising from them shall be governed by, and construed in accordance with, the laws of England. Neither the Plan nor any Award Certificate shall be construed or interpreted with any presumption against the Company by reason of the Company causing the
Plan or Award Certificate to be drafted. 
 15.7 Unless specifically stated otherwise, each Participant, the Company and any other member of the Group
submits to the exclusive jurisdiction of the English courts in relation to all disputes arising out of or in connection with the Plan. By accepting the grant of an Award and not renouncing it, Participants are deemed to have agreed to submit to such
jurisdiction. 

  
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 APPENDIX A 

RULES OF THE FERGUSON GROUP LONG TERM INCENTIVE PLAN 2019 – ELIGIBLE US EMPLOYEES 

Pursuant to a resolution of the Board (as defined below) on 22 March 2019 and an ordinary resolution on 25 April 2019 of the shareholders of the
Company (as defined below), the Rules of the Ferguson Group Long Term Incentive Plan 2019 (the Plan) and this Appendix A were approved. This Appendix A sets forth the modifications of the Plan as applicable to Eligible US Employees (as
defined below). The terms of this Appendix A shall apply automatically to an Eligible US Employee to the extent he is granted an Award under the Plan. If an Eligible Employee becomes an Eligible US Employee following the Date of Grant, his Award
shall be governed by this Appendix A. If there is a conflict between the terms of the Plan, the terms of the Award Certificate and the terms of this Appendix A as applied to an Eligible US Employee, the provisions of this Appendix A shall govern.

  

	1.	 DEFINITIONS 

1.1 In this Appendix A, unless the context otherwise requires, the following words and expressions shall have the following meanings, namely: 

Adoption Date means 25 April 2019; 

Award means an award granted under rule 2 in the form of an Option, a Restricted Share Award, a Conditional Award or a Phantom Award as the
Committee may determine, which is for the time being subsisting; 
 Award Certificate means the certificate or any other document issued in
respect of the grant of an Award under rule 2.8; 
 Board means the board of directors of the Company; 

Capital Reorganisation means any capitalisation issue, rights issue, sub-division, consolidation or
reduction of capital or any other variation of the share capital of the Company; 
 Code means the U.S. Internal Revenue Code of 1986, as
amended from time to time, and regulations thereunder. References to any section of the Code shall be to that section as it may be renumbered, amended, supplemented or re-enacted from time to time. For this
purpose, “regulation” means a regulation, ruling or other interpretation or guidance, validly promulgated by the U.S. Department of Treasury and in effect at the time in question. Reference to a regulation or section thereof includes that
regulation or section and any comparable regulation or section that amends, supplements or supersedes that regulation or section. 
 Committee
means the Remuneration Committee of the Board or some other duly authorised committee of the Board; 
 the Company means the company
incorporated in Jersey as Ferguson plc, with registered number 128484; 

  
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 Control shall have the meaning given to that word by section 995 of the Income Taxes Act 2007
(UK); 
 Conditional Award means an Award which takes the form of a contingent right to acquire or receive Shares at no or nominal cost; 

the Date of Grant means the date on which the Committee grants an Award; 

DI means a depositary interest representing an ordinary share in the capital of the Company; 

Dividend Equivalents means the payment of a cash sum or delivery of Shares in accordance with rule 10.12; 

DRS statement means the direct registration system statement of account representing certificated ordinary shares listed and traded on the
relevant United States Stock Exchange held on the Company’s share register maintained in the United States; 
 DTC means the Depository
Trust Company, being the system used to settle trades of uncertificated ordinary shares listed and traded on the relevant United States Stock Exchange held on the Company’s share register maintained in the United States; 

Eligible US Employee means any employee (or director) of a U.S. Subsidiary or any employee (or executive director) of any other member of the
Group who is subject to U.S. federal income tax with respect to an Award; 
 Employees’ Share Scheme has the
meaning given by section 1166 of the Companies Act 2006 (UK); 
 Employer means the Company or any Subsidiary that, with the consent of the
Company, participates under this Appendix A; 
 Final Value means, in the case of Vested Shares, their aggregate market value calculated by
reference to the closing middle-market quotation of a Share (as derived from the Daily Official List of the London Stock Exchange in the case of a DI priced in Pounds Sterling or from the equivalent such records of the relevant United States Stock
Exchange in the case of an ordinary share in the capital of the Company priced in US Dollars) on the relevant Vesting Date; 
 Financial Year
means a financial year of the Company within the meaning of section 390 of the Companies Act 2006 (UK); 
 Grant Period means the period of 42
days commencing on: 
  

	 	a)	 the Adoption Date; 

  

	 	b)	 the day immediately following the day on which the Company makes an announcement of its results for the last
preceding Financial Year, half year or other period; or 

  

	 	c)	 any day on which the Committee resolves that exceptional circumstances exist which justify the grant of Awards;

 the Group means the Company and its Subsidiaries from time to time and the expression member of the Group
shall be construed accordingly; 

  
 Page 21 

 Holding Period means the period specified in the Company’s share ownership guidelines
from time to time during which the Participant must retain either the Shares which Vest under an Award (including any Shares delivered in satisfaction of Dividend Equivalents) or, in the case of a Vested but unexercised Option, the Option itself;

 Legal Representative means the executor or administrator of the estate of a deceased Participant or a duly appointed guardian of a
Participant, as evidenced by such legal documentation as determined to be satisfactory by the Committee; 
 Listing Rules means the UK Listing
Rules published by the Financial Conduct Authority (as amended from time to time); 
 London Stock Exchange means the London Stock Exchange
Plc or any successor body thereto; 
 Market Value means in relation to a Share or a Notional Share: 

 

	 	a)	 the closing middle-market quotation for a Share (as derived from the Daily Official List of the London Stock
Exchange in the case of a DI priced in Pounds Sterling or from the equivalent such records of the relevant United States Stock Exchange the case of an ordinary share in the capital of the Company priced in US Dollars) for the dealing day immediately
preceding the Date of Grant or, if the Committee so determines, the closing middle-market quotation for a Share (as derived from the Daily Official List of the London Stock Exchange in the case of a DI priced in Pounds Sterling or from the
equivalent such records of the relevant United States Stock Exchange in the case of an ordinary share in the capital of the Company priced in US Dollars) on the Date of Grant; or 

 

	 	b)	 the average of the closing middle-market quotations during such period as the Committee may determine but not
exceeding 30 dealing days ending with the dealing day immediately preceding the Date of Grant provided that such dealing day(s) fall within a Grant Period; 

NASDAQ means Nasdaq, Inc. or any successor body thereto; 

New York Stock Exchange means New York Stock Exchange, Inc. or any successor body thereto; 

Notional Share means a share equal in value to a Share, but having no legal rights attributable to a Share; 

Old Ferguson means Ferguson Holdings Limited, a company incorporated in Jersey with registered number 106605; 

Option means an Award which takes the form of an option to acquire Shares at either no or nominal cost or at Market Value, to be determined at
the discretion of the Committee; 
 Option Exercise Value means, in relation to an Option, the aggregate market value of the Vested Shares
subject to such Option calculated by reference to the closing middle market quotation of a Share (as derived from the Daily Official List of the London Stock Exchange in the case of a DI priced in Pounds Sterling or from the equivalent such records
of the relevant United States Stock Exchange in the case of an ordinary share in the capital of the Company priced in US Dollars) on the last date of the relevant exercise period less any exercise price payable per Share on the exercise of such
Option, provided that if the calculation produces a negative number, the Option Exercise Value shall be nil; 

  
 Page 22 

 Participant means an Eligible Employee who has been granted an Award (including, where the
context permits, the Legal Representative) which has not lapsed or been surrendered or forfeited; 
 Performance Condition means the
performance condition or conditions imposed as a condition of the Vesting of an Award under rule 3.1; 
 Phantom Award means an Award which
takes the form of a right to call for a cash payment calculated by reference to the Final Value of a Notional Share on the Vesting Date; 
 the
Plan means this Ferguson Group Long Term Incentive Plan 2019 as amended from time to time; 
 Relevant Date means: 

 

	 	a)	 if the Relevant Event falls within rule 8.1(a), the date on which Control is obtained and any conditions to
which the offer is made subject are satisfied; 

  

	 	b)	 if the Relevant Event falls within rule 8.1(b), either the date on which the scheme of arrangement is approved
at the shareholders’ meeting or is sanctioned by the Court (as determined by the Committee in its absolute discretion); 

  

	 	c)	 if the Relevant Event falls within rule 8.1(c), the date on which the person first becomes so bound or
entitled; or 

  

	 	d)	 if the Relevant Event falls within rule 8.1(d), the date on which notice of the resolution for winding up is
given; 

 Relevant Event shall have the meaning given to that term in rule 8.1; 

Restricted Shares means Shares subject to a Restricted Share Award which are subject to restrictions in accordance with rule 4; 

Restricted Share Award means an award comprising Restricted Shares; 

Salary means the sterling equivalent (calculated on such basis as the Committee may in its discretion determine) of an Eligible Employee’s
annual gross basic salary expressed in U.S. dollars in respect of his employment with the Group on the Date of Grant of an Award excluding any other benefits or amounts (or if it is expressed in a currency other than U.S. dollars, its sterling
equivalent calculated on such basis as the Committee may in its discretion determine); 
 Scheme of Arrangement means the scheme of
arrangement pursuant to Article 125 of the Companies (Jersey) Law 1991, as amended, to introduce the Company as a new, Jersey-incorporated holding company to the Group; 

  
 Page 23 

 Scheme of Arrangement Effective Date means 10 May 2019 being the date on which the Scheme
of Arrangement became effective in accordance with its terms; 
 Shares means: 

 

	 	a)	 fully paid ordinary shares in the capital of the Company, whether held in certificated or uncertificated form,
via a DRS statement or via the DTC; and/or 

  

	 	b)	 shares representing those shares following any reorganisation of the share capital of the Company;

 Subsidiary means any subsidiary of the Company within the meaning of section 1159 of, and Schedule 6 to, the
United Kingdom Companies Act 2006 (or its equivalent under applicable law) over which the Company has Control; 
 Tax Liability means any
amount of income or employment taxes for which a Participant would or may be liable and for which a member of the Group or former member of the Group would or may be obliged to (or would or may suffer a disadvantage if it were not to) account to any
relevant tax authority; 
 Termination Date means the date on which a Participant ceases to be an employee of a member of the Group and, for
the avoidance of doubt, where the employee dies, shall be taken to mean the date of death; 
 Trustee means the trustee or trustees of any
employee benefit trust established by the Company or any member of the Group; 
 United States Stock Exchange means the New York Stock
Exchange, NASDAQ or such other recognised stock exchange in the United States, on which the Shares are listed; 
 U.S. means the United States
of America; 
 U.S. Subsidiary means a Subsidiary of the Company located in the US; 

Vest means (i) in the case of an Award granted in the form of an Option, when the Option becomes exercisable, or (ii) in the case of
an Award granted in the form of a Restricted Share Award, when the Restricted Shares cease to be subject to a substantial risk of forfeiture (within the meaning of Section 83 of the Code), or (iii) in the case of an Award granted in the
form of a Conditional Award, when the Participant becomes entitled to have the Shares which are the subject of the Conditional Award transferred to him, or (iv) in the case of an Award granted in the form of a Phantom Award, a Participant
becoming entitled to call for a cash sum in accordance with rule 10.10, and Vesting and Vested shall be construed accordingly; 

Vesting Date means the date on which an Award (or part thereof) Vests which, save as provided for in these rules, shall not be earlier than the
third anniversary of the Date of Grant; 
 Vesting Period means the period from the Date of Grant to the Vesting Date; and 

Vested Shares means those Shares, Notional Shares or Restricted Shares in respect of which an Award has Vested. 

  
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 1.2 Where the context permits the singular shall include the plural and vice versa and the masculine shall
include the feminine. 
 1.3 References to any act or statutory instrument of UK Parliament or the legislative bodies of Jersey, the United States of America
or the European Union (the EU) shall include any modification, amendment or re-enactment thereof (and shall, in respect of any EU legislation, include any UK legislation enacted in replacement
thereof following the UK’s departure from the EU). 
  

	2.	 GRANT OF AWARDS 

2.1 Subject to the provisions contained in these rules, the Committee may, during a Grant Period, grant Awards to Eligible Employees selected for participation
by the Committee in its discretion on such terms as it shall in its absolute discretion determine. No consideration shall be payable for the grant of an Award. When the Committee grants an Award, it shall decide whether the Award will take the form
of an Option, a Restricted Share Award, a Conditional Award or a Phantom Award. An Eligible Employee may be granted any form of Award or any combination of Awards. 

2.2 Individual Limit. The maximum total Market Value of Shares over which Awards may be granted to any Eligible Employee in respect of any Financial
Year of the Company is 500 per cent. of his Salary. 
 2.3 Method of satisfying Awards. An Award, other than a Phantom Award, may be satisfied by
the issue of Shares, the transfer of Shares from treasury, or by the transfer of Shares purchased on the market including from an employee benefit trust. 

2.4 Scheme Limit. No Award shall be granted under this Appendix A to the extent that the result of that grant would be that the aggregate number of
Shares that could be issued on the Vesting or, in the case of Options, exercise of that Award and any other Award granted at the same time, when added to the number of Shares that: 

 

	(a)	 could be issued on the vesting of any subsisting share awards or exercise of any options granted during the
preceding ten years under (a) the Plan, (b) this Appendix A and (c) any other Employees’ Share Scheme established by the Company or Old Ferguson; and 

 

	(b)	 have been issued on the vesting of any share awards or exercise of any options granted during the preceding ten
years under (a) the Plan, (b) this Appendix A and (c) any other Employees’ Share Scheme established by the Company or Old Ferguson, 

would exceed 10 per cent. of the ordinary share capital of the Company for the time being in issue. 

2.5 No Award shall be granted under this Appendix A to the extent that the result of that grant would be that the aggregate number of Shares that could be
issued on the Vesting or, in the case of Options, exercise of that Award and any other Award granted at the same time, when added to the number of Shares that: 
  

	(a)	 could be issued on the vesting of any subsisting share awards or exercise of any options granted during the
preceding ten years under (a) the Plan, (b) this Appendix A and (c) any other discretionary share scheme established by the Company or Old Ferguson; and 

  
 Page 25 

	(b)	 have been issued on the vesting of any share awards or exercise of any options granted during the preceding ten
years under (a) the Plan, (b) this Appendix A and (c) any other discretionary share scheme established by the Company or Old Ferguson, 

would exceed 5 per cent. of the ordinary share capital of the Company for the time being in issue. 

2.6 Reference in this rule 2 to the issue of Shares shall, for the avoidance of doubt, mean the issue and allotment (but not transfer) of Shares. The delivery
of Shares from treasury shall also count towards the percentage limits set out in rules 2.4 and 2.5 above for so long as institutional shareholder guidelines recommend this. 

2.7 In determining the above limits no account shall be taken of any Shares attributable to an Award which was released, lapsed or otherwise became incapable
of Vesting. 
 2.8 Award Certificate. The Committee may, in its absolute discretion, enter into a deed poll recording its intention to grant Awards
and agreeing to be bound by the Award Certificates issued pursuant to this rule 2.8. As soon as reasonably practicable following the Date of Grant, the Committee shall procure the issue of an Award Certificate in respect of the Award and send
it to the Participant. If the Committee has not entered into a deed poll prior to the granting of the Awards, the Committee shall procure that the Award Certificates are issued under the seal of the Company or otherwise to take effect as a deed. An
Award Certificate shall state: 
  

	2.8.1	 whether the Award will take the form of an Option, a Restricted Share Award, a Conditional Award or a Phantom
Award; 

  

	2.8.2	 if the Award is granted subject to the terms of the Plan or this Appendix A; 

 

	2.8.3	 the name of the Eligible Employee receiving the Award; 

 

	2.8.4	 the Date of Grant of the Award; 

 

	2.8.5	 whether an Award will be granted in respect of ordinary shares; 

 

	2.8.6	 the number of Shares or Restricted Shares (or, in the case of an Award granted in the form of a Phantom Award,
Notional Shares) comprised in the Award; 

  

	2.8.7	 the exercise price payable by the Participant on exercise of the Award (if any); 

 

	2.8.8	 the Vesting Date or Dates which shall not be later than the tenth anniversary of the Date of Grant;

  

	2.8.9	 if more than one Vesting Date is specified, the number or proportion of the Shares comprised in an Award which
will ordinarily Vest on each of the specified Vesting Dates; 

  

	2.8.10	 the Performance Condition applicable to the Award; 

 

	2.8.11	 whether Dividend Equivalents should be paid in respect of an Award; 

  
 Page 26 

	2.8.12	 whether the Participant has an obligation to enter into an agreement, election or arrangement including,
without limitation, pursuant to rule 10.14; 

  

	2.8.13	 details of the Holding Period that shall apply to the Award; and 

 

	2.8.14	 details of the clawback and malus terms that apply to an Award. 

The Committee may require a Participant to sign and return within a specified period a copy of the Award Certificate or other document acknowledging his
agreement to be bound by the terms of the Plan and may determine that a Participant’s failure to do so within the specified period shall cause the Award to lapse and shall be treated as if it had never been granted. 

Subject thereto, an Award Certificate shall be in such form as the Committee may determine from time to time. 

2.9 Duration of this Appendix A. An Award may not be granted: 
  

	2.9.1	 earlier than the Adoption Date; nor 

 

	2.9.2	 later than the tenth anniversary of the Adoption Date. 

2.10 Non-transferability and bankruptcy. An Award shall be personal to a Participant and shall not (except to
the extent necessary to enable a Legal Representative to realise the Award following the death of a Participant) be capable of being transferred, charged or otherwise alienated and shall lapse immediately if the Participant purports to transfer,
charge or otherwise alienate the Award or if he is declared bankrupt. 
 2.11 Right to Renounce Awards. A Participant may, by notice in writing to the
Company within thirty days after the Date of Grant, renounce (in whole but not in part) his rights under the Award. In such a case, the Award shall to that extent be treated, for the purpose of this Appendix A, as never having been granted. No
consideration shall be due for any such renunciation. 
 2.12 Approvals and consents. The grant of an Award shall be subject to obtaining any approval
or consent required under the Listing Rules, the Market Abuse Regulation and any relevant share dealing code of the Company, the City Code on Takeovers and Mergers and any other UK or overseas regulation or enactment related to the grant of Awards
to Eligible Employees in the jurisdictions in which they are resident. 
  

	3.	 PERFORMANCE CONDITION 

3.1 The Committee shall impose Performance Conditions which must be satisfied in order for an Award to Vest. Unless the Committee determines otherwise, the
Performance Conditions set out in Schedule 1 to the Plan shall apply. 
 3.2 The Committee can set different Performance Conditions for Awards granted in
different years (in terms of the type of condition, the weighting given to that condition and the targets applicable to each condition) provided that, in the reasonable opinion of the Committee, the Performance Conditions for Awards granted in one
year is not materially less challenging than the Performance Conditions for Awards granted in any other year. 

  
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 3.3 The Committee may vary the Performance Conditions applying to existing Awards if an event occurs or
there are circumstances (for example, an acquisition or disposal of a business or a significant part of a business) such that the condition is no longer a fair measure of performance provided that, in the reasonable opinion of the Committee, the new
condition is not materially less challenging than the original condition would have been but for the event or circumstances in question. 
 3.4 The Committee
shall, as soon as reasonably practicable, notify a Participant of any substitution or variation of the Performance Conditions. 
  

	4.	 AWARDS WHICH TAKE THE FORM
OF A RESTRICTED SHARE AWARD 

 4.1 If an Award takes the
form of a Restricted Share Award, the Restricted Shares subject to the Award shall, except to the extent that the Award has Vested, be subject to such restrictions on the transfer, assignment, sale, pledge, charge or other disposal of the Restricted
Shares during the Vesting Period as the Committee may prescribe and an Eligible Employee may be required to enter into an irrevocable agreement with the Company and, if necessary, the Eligible Employee’s Employer, in such form as the Committee
may prescribe which may include an agreement by the Eligible Employee: 
  

	(a)	 not to transfer, assign, sell, pledge, charge or otherwise dispose of any Restricted Shares subject to the
Award except to the extent that the Award has Vested; and 

  

	(b)	 to transfer (or procure the transfer) to or to the order of the Company, for a total of one penny (or the
equivalent in a Participant’s local currency), all the Restricted Shares in respect of which the Award does not Vest. 

 4.2 If the
Eligible Employee does not enter into any required agreement either before the Date of Grant or within such period after the Date of Grant as the Committee may specify, the Award shall not be granted or if it has been granted, such grant shall be
ineffective. 
 4.3 On or before the Date of Grant for an Award which takes the form of a Restricted Share Award, the Company shall transfer or procure the
transfer to the Participant or his nominee or such other person as the Committee may determine the number of Restricted Shares which are subject to the Award. 

4.4 To the extent that an Award which takes the form of a Restricted Share Award Vests, any restrictions referred to in rule 4.1 shall cease to have effect in
relation to the Shares subject to that Awards. 
 4.5 Notwithstanding that the Award has not Vested, a Participant shall be entitled to receive the cash
equivalent of any dividends paid on Restricted Shares in the period between the Date of Grant and the Vesting Date. Such “dividend equivalents” on unvested Restricted Shares will be paid at the same times as ordinary dividends are paid to
ordinary shareholders of the Company. 
 4.6 A Participant who receives an Award of Restricted Shares may file with the U.S. Internal Revenue Service, within
30 days of the Date of Grant of such Award, an election, pursuant to Section 83(b) of the Code, to be taxed currently on the fair market value of all or any portion of the unvested Shares in such award. It is the Participant’s sole
responsibility, and not that of the Company or of any other member of the Group, to make any such decision and to file timely and in accordance with applicable regulations any election that may be so available. 

  
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	5.	 VESTING OF AWARDS AND HOLDING
PERIODS 

 5.1 Timing of Vesting. Subject to rules 6, 7, 8, and the satisfaction of the Performance
Condition, an Award (or part thereof) shall Vest on the Vesting Date. 
 5.2 Holding Period. A Participant shall take such steps as the Committee may
reasonably require to satisfy the Committee as to the Participant’s observance of the Holding Period. For the avoidance of doubt, in circumstances where Participants are offered and accept a replacement Award in accordance with rule 9, the new
award (as defined in rule 9.1) shall be subject to the Holding Period at such time as it Vests. 
  

	6.	 LEAVERS 

6.1 Death. If a Participant dies, Awards granted to him will Vest on the Termination Date in accordance with rule 6.4. 

6.2 Other Leavers. Where a Participant ceases to be an Eligible Employee at any time before the Vesting Date applicable to his Award by reason of: 

 

	(a)	 redundancy; 

  

	(b)	 injury, disability or ill-health (evidenced to the satisfaction of the
Committee); 

  

	(c)	 his employing company ceasing to be under the Control of the Company; 

 

	(d)	 the business (or part of a business) in which he is employed being transferred to a person who is not a member
of the Group, or 

  

	(e)	 any other reason at the discretion of the Committee, 

his Award shall continue, and will Vest on the original Vesting Date in accordance with rule 6.3, save that the Committee may determine that an Award shall
instead Vest on the Termination Date in accordance with rule 6.4. Where an Award is subject to more than one Performance Condition, the Committee may treat each discrete part of the Award that is subject to a particular Performance Condition as a
separate Award with the result that the Committee may determine that part of an Award shall continue and Vest on the original Vesting Date in accordance with rule 6.3 and that part of an Award shall Vest on the Termination Date. 

6.3 Delayed Vesting. Where an Award Vests in accordance with this rule 6.3, the number of Vested Shares shall be determined by the Committee by
reference to: 
  

	(a)	 the application of the Performance Condition at the original Vesting Date; and 

 

	(b)	 multiplying the resulting number of Shares, Notional Shares or Restricted Shares by the fraction
A/B (where A is the number of complete months from the Date of Grant to the Termination Date and which shall not be greater than the total number of months in the Vesting Period and B is 36 or such other
number as is equal to the number of months in the Vesting Period), save that the Committee may, in its absolute discretion, disapply in whole or in part the application of the time pro-rating fraction.

  
 Page 29 

 6.4 Immediate Vesting. Where an Award Vests in accordance with this rule 6.4 the number of Vested
Shares shall be determined by the Committee by reference to: 
  

	(a)	 the application of the Performance Condition at the Termination Date, or at such other date (whether later or
earlier) within a period of one month of the Termination Date on which data is available in the ordinary course to allow the testing of Performance Conditions; and 

 

	(b)	 multiplying the resulting number of Shares, Notional Shares or Restricted Shares by the fraction
A/B (where A is the number of complete months from the Date of Grant until the Termination Date and which shall not be greater than the total number of months in the Vesting Period and B is 36 or equal to
such other number of months in the original Vesting Period), save that in any particular case, the Committee may, in its absolute discretion, disapply in whole or in part the application of the time pro-rating
fraction. 

 6.5 If a Participant ceases employment in any circumstances other than those described at rules 6.1 or 6.2, his unvested
Awards shall lapse automatically on the Termination Date. 
 6.6 Meaning of ceasing employment. For the purposes of this rule 6, a Participant shall
not be treated as ceasing to be an Eligible Employee until he ceases to be employed by or hold office with the Company or any member of the Group. The reason for the termination of employment of a Participant shall be determined by reference to rule
6.1 and 6.2 regardless of whether such termination was lawful or unlawful (and howsoever caused). 
  

	7.	 MALUS AND CLAWBACK 

7.1 Notwithstanding any other rule of this Appendix A, if one or more of the circumstances set out in rule 7.2 occur the Committee may (a) at any time
where the circumstances fall within rule 7.2.4 below; or (b) prior to the fifth anniversary of the Date of Grant in all other circumstances determine (acting fairly and reasonably having taken into account the scale of loss or damage to the
Company or the extent of the risk taken by the Company) to take one or more of the following actions in relation to any one or more Participants: 
  

	7.1.1	 reduce (including to nil) the number of Shares, Notional Shares or Restricted Shares in respect of which any
future Award is granted to a Participant; 

  

	7.1.2	 reduce (including to nil) the cash amount payable under an unvested Award held by a Participant or the number
of Shares, Notional Shares or Restricted Shares under an unvested Award and/or the number of Shares and/or Dividend Equivalents under a Vested but unexercised Option held by a Participant, by such amount and/or such number as the Committee considers
appropriate in the circumstances; or 

  

	7.1.3	 in relation to a Vested Award, require a Participant to pay to the Company or such other person as the Company
may direct within 30 days of a written demand from the Company such number of Shares or such monetary amount with a value to be determined in the Committee’s absolute discretion provided such value on the date of demand is no greater than the
value of the Vested Shares and Dividend Equivalents under Award at the Vesting Date, less any amount paid by or in respect of the Participant in respect of a Tax Liability incurred as a result of the Vesting of the relevant Award (except to the
extent the Participant is able to recover amounts paid in respect of such Tax Liability). 

  
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 7.2 The circumstances in which the Committee may consider that it is appropriate to exercise its discretion
under rule 7.1 are the following: 
  

	7.2.1	 a material financial misstatement of the Company’s audited financial accounts (other than as a result of a
change in accounting practice); 

  

	7.2.2	 conduct by a Participant which results in or is reasonably likely to result in significant reputational damage
to the Company; 

  

	7.2.3	 the negligence or gross misconduct of a Participant; or 

 

	7.2.4	 fraud effected by or with the knowledge of a Participant. 

7.3 If the Committee decides to exercise its discretion under this rule 7, it shall confirm this in writing to each affected Participant. 

7.4 For the purposes of these rules, if the Committee decides to exercise its discretion under rule 7.1.2 before an Award Vests: 

 

	7.4.1	 the Award shall be deemed to have been granted over the reduced number of Shares, Notional Shares or Restricted
Shares (as the case may be); and 

  

	7.4.2	 any subsequent Vesting of the Award shall be determined by reference to this reduced number of Shares, Notional
Shares or Restricted Shares, 

 SAVE THAT if the number of Shares, Notional Shares or
Restricted Shares is reduced to nil, the Award shall be treated as if it had never been granted and such Participant (including a Participant who has left employment before the Vesting Date) shall have no rights to any cash amount, Dividend
Equivalents, Shares, Notional Shares or Restricted Shares. 
  

	8.	 TAKE-OVER AND LIQUIDATION

 8.1 This rule 8 applies if: 
  

	(a)	 any person (either alone or together with any person acting in concert with him) obtains Control of the Company
as a result of making: 

  

	 	(i)	 a general offer to acquire the whole of the issued ordinary share capital of the Company which is made on a
condition such that if it is satisfied, the person making the offer will have Control of the Company; or 

  

	 	(ii)	 a general offer to acquire all of Shares; 

 

	(b)	 any person proposes to obtain Control of the Company in pursuance of a compromise or arrangement sanctioned by
the Court under Article 125 of the Companies (Jersey) Law 1991 or its equivalent under applicable law; 

  
 Page 31 

	(c)	 any person becomes bound or entitled to acquire Shares in the Company under Part 18 of the Companies (Jersey)
Law 1991 or its equivalent under applicable law; or 

  

	(d)	 notice is given of a resolution for the voluntary or compulsory
winding-up of the Company, 

 (each a Relevant Event). 

8.2 Where this rule 8 applies and subject to rules 8.3, 8.4 and 9 below, all outstanding Awards will automatically Vest and, in the case of an Award granted
in the form of an Option shall be automatically exercised on the Relevant Date provided that any exercise price payable by the Participant on exercise is equal to or less than the relevant offer price or consideration (as determined by the
Committee). Where this rule 8 applies, and subject to rules 8.3, 8.4 and 9 below, any outstanding Awards granted in the form of Options that are not exercised on the Relevant Date shall lapse automatically. 

8.3 Proportion of Award that Vests. The number of Shares in respect of which the Award Vests shall be determined by the Committee by reference to: 

 

	(a)	 the application of the Performance Condition at the Relevant Date; and 

 

	(b)	 multiplying the resulting number of Shares, Notional Shares or Restricted Shares by the fraction
A/B (where A is the number of complete months from the Date of Grant until the Relevant Event and which shall not be greater than the total number of months in the Vesting Period and B is 36 or equal to such
other number of months in the original Vesting Period), SAVE THAT in any particular case, the Committee may, in its absolute discretion, disapply, in whole or in part, the application of the time pro-rating fraction. 

 8.4 Without prejudice to the operation of rule 9, Awards shall not Vest or be
exercised without the consent of the Committee under the foregoing provisions of this rule 8 if the purpose and effect of the Relevant Event, together with any associated transactions, is to create a new holding company for the Company, such company
having substantially the same shareholders and proportionate shareholdings as those of the Company immediately prior to the Relevant Event. Unless the Committee determines otherwise in its absolute discretion, an Award will in such circumstances be
exchanged for an equivalent award in accordance with rule 9 below and notice of a replacement award shall be issued to each affected Participant accordingly. 
  

	9.	 ROLLOVER OF AWARDS 

9.1 If any other business entity (the acquiring company): 
  

	(a)	 obtains Control of the Company as a result of making: 

 

	 	(i)	 a general offer to acquire the whole of the issued ordinary share capital of the Company which is made on a
condition such that if it is satisfied the acquiring company will have Control of the Company; or 

  

	 	(ii)	 a general offer to acquire all the Shares; or 

  
 Page 32 

	(b)	 proposes to obtain Control of the Company in pursuance of a compromise or arrangement sanctioned by the Court
under Article 125 of the Companies (Jersey) Law 1991 or its equivalent under applicable law; or 

  

	(c)	 becomes bound or entitled to acquire shares in the Company under Part 18 of the Companies (Jersey) Law 1991 or
their equivalent under applicable law, and the acquiring company notifies Participants of an offer of a replacement Award, then, on the Relevant Date, for any Award which has not lapsed (the old award) a Participant may
elect to release and accept in consideration of that release an award (the new award) which (in the opinion of the Committee) is equivalent to the old award but relates to shares in a different company (whether the acquiring company
itself or another company) (the new grantor). 

 9.2 The provisions of this Appendix A shall be construed as if: 

 

	(a)	 the new award were an award granted under this Appendix A at the same time as the old award;

  

	(b)	 references to the Company in the rules were references to the new grantor; 

 

	(c)	 references to the Committee in the rules were references to the board of directors of the new grantor or any
duly authorised committee thereof; 

  

	(d)	 references to Shares were references to shares in the new grantor; and 

 

	(e)	 the Vesting Date in relation to the new award was the same as that in relation to the old award.

 9.3 The Committee may make such adjustments to the Performance Condition applicable to the new award as it, in its absolute discretion,
considers appropriate. 
 9.4 Subject to rule 8.4, if notice is given by an acquiring company under rule 9.1 and a Participant does not elect to release
an old award and accept in consideration for that release a new award, the old award will vest and be exercised in accordance with rule 8.2. 
  

	10.	 CONSEQUENCES OF VESTING 

10.1 Options. On the Vesting of an Award which takes the form of an Option the Participant may, subject to any shorter period imposed pursuant to this
Appendix A or the Award Certificate, exercise the Option over some or all of the Vested Shares during the period to the tenth anniversary of the Date of Grant, but in no event later than March 15 of the calendar year following the calendar year
in which the Vesting Date occurs. 
 10.2 If the Award has Vested due to a Participant’s death or if the Participant dies during the exercise period
specified in rule 10.1 above, the Award may be exercised by the Legal Representative during the period of 12 months following the date of death, but in no event later than March 15 of the calendar year following the calendar year in which
the Vesting Date occurs. 

  
 Page 33 

 10.3 If the Award has Vested in accordance with rules 6.2 or 8.2, the Award may be exercised during the
period of 6 months following the Vesting Date, but in no event later than March 15 of the calendar year following the calendar year in which the Vesting Date occurs. 

10.4 If a Participant ceases employment in any circumstances other than those described at rules 6.1 or 6.2, his Awards may be exercised in respect of Vested
Shares during the period of one month following the Termination Date, but in no event later than March 15 of the calendar year following the calendar year in which the Vesting Date occurs. 

10.5 If, during the period in which an Option may otherwise be exercised under these rules, the Participant is subject to any dealing restrictions under the
Listing Rules, the Market Abuse Regulation or any relevant share dealing code of the Company, the applicable period shall be suspended until such later date as those dealing restrictions lift provided that no Option may be exercised more than
10 years after its Date of Grant and in no event later than March 15 of the calendar year following the calendar year in which the Vesting Date occurs. Subject to rules 10.11, 10.12 and 10.15 and any arrangements to give effect to the
Holding Period in accordance with rule 5.2, the Company shall procure the issue or transfer of the Vested Shares to the Participant (or his nominee) as soon as reasonably practicable after the exercise date and in any event not later than 30 days
thereafter, but in no event later than March 15 of the calendar year following the calendar year in which the Vesting Date occurs. 
 10.6 If a
Participant has not exercised his Option before March 15 of the calendar year following the calendar year in which the Vesting Date occurs (the Relevant Period), the following provisions shall apply: 

 

	(a)	 if the exercise price payable by the Participant does not exceed the closing middle market quotation of a Share
(as derived from the Daily Official List of the London Stock Exchange in the case of a DI priced in Pounds Sterling or from the equivalent such records of the relevant United States Stock Exchange in the case of an ordinary share in the capital of
the Company priced in US Dollars) on the last day of the Relevant Period, the Option shall be deemed to have been exercised on the last day of the Relevant Period; or 

 

	(b)	 subject to (a) above, the Option shall be settled by the Committee making a payment of (or procuring the
payment of) a cash sum to the Participant equal to any Option Exercise Value, subject to such deductions for any Tax Liability required by applicable law. The Committee may in its discretion pay or procure the payment of any cash sum in U.S. dollars
or the equivalent in a Participant’s local currency (converted on the basis of such exchange rate as the Committee may in its discretion determine). 

10.7 The Participant may exercise a Vested Option by written notice to the Company in such form as the Committee may prescribe. 

10.8 Conditional Awards. On the Vesting of an Award which takes the form of a Conditional Award a Participant need take no action and the Company shall,
subject to rules 10.11, 10.12 and 10.15 and any arrangements to give effect to the Holding Period in accordance with rule 5.2 procure the issue or transfer of the Vested Shares to the Participant (or his nominee) as soon as reasonably practicable
after the Vesting Date but in no event later than March 15 of the calendar year following the calendar 

  
 Page 34 

 
year in which the Vesting Date occurs. If the Award has Vested due to a Participant’s death or if the Participant dies after Vesting and prior to issuance or transfer of the Vested Shares,
such Shares shall be issued or transferred to the Legal Representative as soon as reasonably practicable after the date of death, but in no event later than March 15 of the calendar year following the calendar year in which the date of death
occurred. 
 10.9 Restricted Share Awards. On the Vesting of an Award which takes the form of a Restricted Share Award the Shares shall cease to be
subject to all restrictions and any agreement applying to the Restricted Shares shall cease to have effect. For the avoidance of doubt, the Participant shall be required to comply with arrangements in respect of such Shares to give effect to the
Holding Period in accordance with rule 5.2. 
 10.10 Phantom Awards. On the Vesting of an Award which takes the form of a Phantom Award, the
Committee shall pay, or procure the payment of, a cash sum to the Participant equal to the Final Value of the Vested Notional Shares to which the Phantom Award relates, subject to such deductions for any Tax Liability as are required by applicable
law. The Committee may in its discretion pay or procure payment of the cash sum in U.S. dollars or the equivalent in a Participant’s local currency (converted on the basis of such exchange rate as the Committee may in its discretion determine).
The cash sum will be paid as soon as reasonably practicable following the Vesting Date, but in no event later than March 15 of the calendar year following the calendar year in which the Vesting Date occurs. 

10.11 Restrictions on Vesting. An Award shall not Vest unless and until the issue or transfer of Shares (if relevant) after such Vesting would be lawful
in all relevant jurisdictions and in compliance with the Listing Rules, any relevant share dealing code of the Company, the City Code on Takeovers and Mergers and any other relevant UK or overseas regulation or enactment related to the Vesting of an
Award in the jurisdictions in which the relevant Participant is resident for tax purposes, but in no event shall the Award Vest later than 31 December of the calendar year in which the Award would otherwise have Vested, but for the operation of
this rule 10.11. 
 10.12 Dividend Equivalents. Where the Committee has at the Date of Grant determined that Dividend Equivalents shall be paid,
within the period of 30 days following the Vesting Date (but in no event later than March 15 of the calendar year following the calendar year in which the Vesting Date occurs), the Company shall either: 

 

	(a)	 pay the Participant a cash sum, or 

 

	(b)	 issue or transfer Shares to the Participant, 

in either case having a value equal to the sum of the dividends that the Participant would have received had the Participant held Vested Shares throughout the
period between the Date of Grant and the Vesting Date. An amount equivalent to the Tax Liability may be deducted from such payment or delivery of Shares. This rule shall not apply in respect of any super dividend, dividend in specie or other
distribution paid by the Company (each being a Distribution) which would otherwise materially affect the value of an Award and for which an Award is adjusted pursuant to rule 12. For the purpose of this rule 10.12 and rule 12, a
Distribution shall not materially affect the value of an Award if the Company undertakes a share consolidation in conjunction with the Distribution that has the effect that the Market Value of a Share before and after the Distribution is
substantially equivalent. 

  
 Page 35 

 10.13 Payment of Tax Liability. Any liability of a Participant to taxation or social security
contributions shall be for the account of the relevant Participant and the issue or transfer of Vested Shares subject to a Participant’s Vested Award shall be conditional upon the Participant having discharged the amount required to satisfy the
Tax Liability which arises on Vesting or exercise to the satisfaction of the Company, or otherwise having complied with any arrangements specified by the Company to secure that such Tax Liability is satisfied including irrevocably authorising the
Company to sell or procure the sale of sufficient Vested Shares on or following the Vesting or exercise (as applicable) of his Award on his behalf to ensure that any relevant member of the Group or former member of the Group receives the amount
required to discharge the Tax Liability which arises as a result of the Vesting or exercise of his Award and by participating in this Appendix A a Participant is deemed to have given such authorisation. 

10.14 Elections. A Participant shall enter into any agreement, election or arrangement which the Committee may consider appropriate within such period
as may be specified by the Committee, in relation to or in connection with any liability to income tax or social security contributions (including, if permitted under local law, any employer’s social security contributions) in respect of the
Participant’s Award or the Shares subject to his Award. For example, but without limitation, the Committee may require Participants who are resident in the UK for tax purposes to enter into an agreement or election pursuant to paragraphs 3A or
3B of Schedule 1 to the UK Social Security Contributions and Benefits Act 1992 or a joint election under Section 431 of the UK Income Tax (Earnings and Pensions) Act 2003 by the fourteenth day following the acquisition of any Shares by the
Participant. 
 10.15 Cash settlement. If for any reason the Committee considers that it is impractical or legally onerous to deliver Shares in
satisfaction of a Vested Award, it may instead pay or procure the payment to the Participant of a cash sum equal to the Final Value of the Vested Shares, subject to such deductions for any Tax Liability required by applicable law. The Committee may
in its discretion pay or procure the payment of any cash sum in U.S. dollars or the equivalent in a Participant’s local currency (converted on the basis of such exchange rate as the Committee may in its discretion determine). 

 

	11.	 RELATIONSHIP OF THIS APPENDIX A
TO CONTRACT OF EMPLOYMENT 

 11.1 The rights and obligations of a
Participant under the terms and conditions of employment shall not be affected by his participation in this Appendix A or any right he may have to participate in this Appendix A. An individual who participates in this Appendix A waives all and any
rights to compensation or damages in consequence of the termination of his employment with any member of the Group (or former member of the Group if applicable) for any reason whatsoever (whether lawfully or unlawfully) insofar as those rights
arise, or may arise from his ceasing to have rights under or be entitled to exercise any Award under this Appendix A, as a result of such termination or from the loss or diminution in value of such rights or entitlements. In the event of any
conflict between the terms of this rule 11 and the Participant’s terms of employment, this rule shall take precedence. 

  
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 11.2 Notwithstanding any other provision of this Appendix A: 

 

	11.2.1	 this Appendix A shall not form part of any contract of employment between the Company or any Subsidiary and a
Participant; 

  

	11.2.2	 no Eligible Employee has any right to be granted an Award and the fact that an Eligible Employee may have
participated in this Appendix A and/or been granted an Award under this Appendix A shall not entitle any Eligible Employee to future participation or grants; 

  

	11.2.3	 the benefit to a Participant of participation in this Appendix A (including, in particular but not by way of
limitation, any Awards held by him) shall not form any part of his contractual remuneration or benefits or count as his contractual remuneration or benefits for any purpose and shall not be pensionable; 

 

	11.2.4	 nothing in this Appendix A shall in any way be construed as imposing upon any member of the Group a contractual
obligation as between the member of the Group and a Participant to contribute to this Appendix A; and 

  

	11.2.5	 by accepting the grant of an Award and not renouncing it a Participant is deemed to have agreed to the
provisions of this Appendix A and in particular, this rule 11.2. 

  

	12.	 ADJUSTMENT OF AWARDS 

12.1 In the event of any Capital Reorganisation (or the implementation by the Company of a demerger or payment of a super dividend, dividend in specie or other
distribution paid by the Company which would otherwise materially affect the value of an Award), the price payable by a Participant on Vesting (or exercise of an Option) (if any), the description of Shares, Notional Shares or Restricted Shares and
the number of Shares, Notional Shares or Restricted Shares comprised in an Award may be adjusted in such manner as the Committee may determine. Any adjustment to Awards made pursuant to this rule 12 shall be notified to the relevant
Participant. 
  

	13.	 ADMINISTRATION AND AMENDMENT 

13.1 Committee responsible for administration. The decision of the Committee shall be final and binding in all matters relating to this Appendix A and
it may at any time discontinue the grant of further Awards or amend any of the provisions of this Appendix A in any way it thinks fit, provided that: 
  

	(a)	 except as herein provided, the Committee shall not make any amendment that would materially prejudice the
interests of existing Participants in any jurisdiction in which this Appendix A operates except with the prior consent or sanction of Participants in that jurisdiction who, if their Awards Vested in full, would thereby become entitled to a majority
of all the Shares which would fall to be transferred upon satisfaction of all outstanding Awards in that jurisdiction; 

  
 Page 37 

	(b)	 without prejudice to any provision of this Appendix A which provides for the lapse of an Award, the Committee
may not cancel an Award unless the Participant agrees in writing to such cancellation; and 

  

	(c)	 no amendment to the advantage of Eligible Employees or Participants may be made to: 

 

	 	(i)	 the definition of Eligible Employee in rule 1.1; 

 

	 	(ii)	 the limitations on the numbers of Shares subject to this Appendix A; 

 

	 	(iii)	 the maximum entitlement of an Eligible Employee under this Appendix A; 

 

	 	(iv)	 the basis for determining an Eligible Employee’s entitlement to Shares under this Appendix A;

  

	 	(v)	 the terms of Shares to be provided under this Appendix A; 

 

	 	(vi)	 the adjustment provisions of rule 12 of this Appendix A; 

without the prior approval of the Company in a general meeting, except in the case of minor amendments to benefit the administration of this
Appendix A, to take account of a change in legislation or to obtain or maintain favourable tax, exchange control or regulatory treatment for Eligible Employees and/or Participants or any member of the Group. 

 

	14.	 DATA PROTECTION 

14.1 By accepting the grant of an Award, a Participant acknowledges that the Company or any member of the Group may hold, process and transfer personal data
relating to them to other members of the Group or to any third parties engaged by them (whether within or outside of the European Economic Area (EEA) and that personal data may also be processed outside the EEA by the Company or any
member of the Group or by one or more held or of its or their service providers) for any and all purposes related to the operation and administration of the Plan and/or in order to meet any legal obligation, in each case in accordance with the
Company’s Share Plan Data Protection Protocol and applicable law. 
  

	15.	 GENERAL 

15.1 Any member of the Group may provide money to the Trustee or any other person to enable them or him to acquire (and to subscribe for) Shares to be held for
the purposes of this Appendix A, or enter into any guarantee or indemnity for those purposes, to the extent not prohibited by applicable law. 
 15.2 The
existence of any Award shall not affect in any way the right or power of the Company or its shareholders to make or authorise any or all adjustments, recapitalisations, reorganisations or other changes in the Company’s capital structure, or any
merger or consolidation of the Company, or any issue of shares, bonds, debentures, preferred or prior preference stocks ahead of or convertible into, or otherwise affecting the Shares or the rights thereof, or the dissolution or liquidation of the
Company or any sale or transfer of all or any part of its assets or business, or any other corporate act or proceeding, whether of a similar character or otherwise. 

  
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 15.3 Awards constitute unsecured promises by the Employers to pay benefits in the future. Participants
holding such Awards shall have the status of general unsecured creditors of the Company or the Employer, as applicable. Each Employer shall be solely responsible for payment of the benefits of its employees and their beneficiaries. This Appendix A
is unfunded for U.S. federal tax purposes. Any amounts set aside to defray the liabilities assumed by the Company or an Employer will remain the general assets of the Company or the Employer, as applicable, and shall remain subject to the claims of
the Company’s or the Employer’s creditors until such amounts are distributed to Participants. 
 15.4 This Appendix A is intended to be exempt
from, and to the extent not so exempt to comply with, the requirements of Section 409A of the Code (“Section 409A”) and shall be interpreted and administered accordingly. Notwithstanding anything to the contrary in this Appendix
A, if a Participant is a “specified employee” as defined in Section 409A as of the date the Participant separates from service (within the meaning of Section 409A), then, to the extent required by Section 409A, payments due
under this Appendix A resulting from the Participant’s separation from service may not be made until the earlier of: (i) the first day following the sixth month anniversary of the date of the Participant’s separation from service for
a reason other than death; and (ii) the Participant’s date of death; provided, however, that any payments delayed during this period shall be paid in the aggregate in a lump sum as soon as reasonably practicable following the earlier of
the sixth month and one day anniversary of the Participant’s separation from service or the Participant’s date of death, as the case may be. Notwithstanding the foregoing, the Employers do not guarantee the tax treatment of any payments or
benefits under this Appendix A including, without limitation, under the Code, federal, state, municipal, local or foreign laws. 
 15.5 Any notice or other
document required to be given under or in connection with this Appendix A may be delivered to a Participant or sent by post to him at his home address according to the records of his Employer or such other address as may appear to the Company to be
appropriate. Notices sent by post shall be deemed to have been given on the day following the date of posting. Any notice or other document require to be given to the Company under or in connection with this Appendix A may be delivered or sent by
post to it at its corporate services office at 1020 Eskdale Road, Winnersh, Wokingham RG41 5TS (or such other place or places as the Committee may from time to time determine and notify to Participants). 

15.6 The Company, or where the Committee so directs any Subsidiary, shall pay the appropriate stamp duty on behalf of the Participants in respect of any issue
or transfer of Shares on the Vesting or exercise of the Awards. 
 15.7 Benefits under this Appendix A shall not be pensionable. 

15.8 These rules and any contractual and non-contractual obligations arising from them shall be governed by, and
construed in accordance with, the laws of England. Neither the Plan, this Appendix A nor any Award Certificate shall be construed or interpreted with any presumption against the Company by reason of the Company causing the Plan, this Appendix A or
Award Certificate to be drafted. Any ambiguity or interpretation of this Appendix A to the extent possible, as determined by the Committee in its sole discretion, shall be determined in accordance with any corresponding interpretation or decision
with respect to the Plan. 

  
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 15.9 Unless specifically stated otherwise, each Participant, the Company and any other member of the Group
submits to the exclusive jurisdiction of the English courts in relation to all disputes arising out of or in connection with this Appendix A. By accepting the grant of an Award and not renouncing it, Participants are deemed to have agreed to submit
to such jurisdiction. 

  
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 SCHEDULE 1 

PERFORMANCE CONDITION 
 The Award shall be
subject to, and tested against, the following conditions in the following proportions: 
  

			
	 Performance Measure
	  	 Percentage of Award tested against relevant Performance
Measure

	A. Total Shareholder Return (TSR)	  	33.3% (or such other percentage not exceeding 40% determined by the Committee at the Date of Grant)
		
	B. Earnings per Share (EPS)	  	33.3% (or such other percentage not exceeding 40% determined by the Committee at the Date of Grant)
		
	C. Cash Flow from Operating Activities (OpCF)	  	33.3% (or such other percentage not exceeding 40% determined by the Committee at the Date of Grant)

 The aggregate percentage for the Performance Measures applicable to an Award shall be 100%. 

The amount of an Award that Vests shall be determined by applying the applicable Performance Percentage in respect of a Performance Measure to the relevant
Percentage of an Award. Total amount Vesting shall be the aggregate of all the percentages. 
  

	A.	 TOTAL SHAREHOLDER RETURN 

Within 45 days of the end of the Performance Period applicable to the Award: 
  

	(a)	 the TSR shall be calculated over the Performance Period; 

 

	(b)	 the CSR of each Comparator Company shall be calculated; 

 

	(c)	 the TSR shall be ranked within the List so as to determine where within the List TSR falls;

  

	(d)	 if the TSR, when so ranked against the CSR, falls: 

 

	 	(i)	 in the first quartile, the Performance Percentage shall be 100%; 

 

	 	(ii)	 at the fiftieth percentile, the Performance Percentage shall be 25%; 

 

	 	(iii)	 below the fiftieth percentile, the Performance Percentage shall be zero; and 

 

	(e)	 in between these points, the Performance Percentage shall be calculated on a straight line basis.

  
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 Shortened Performance Period Notwithstanding the above, where the Performance Condition is to be
measured over a shortened Performance Period for any reason (including pursuant to rules 6.4 and 8.2) the Committee may make such adjustments to the Performance Condition as it, in its absolute discretion, considers appropriate so that the outcome
fairly reflects the underlying financial performance of the Company over that shortened Performance Period. 
  

	B.	 EARNINGS PER SHARE 

 

	(a)	 If the EPS Growth achieved over the Performance Period is equal to: 

 

	 	(i)	 30% plus RPI, the Performance Percentage shall be 100%; 

 

	 	(ii)	 9% plus RPI, the Performance Percentage shall be 25%; 

 

	 	(iii)	 below 9% plus RPI, the Performance Percentage shall be zero; and 

 

	(b)	 for EPS Growth that falls in between 9% plus RPI and 30% plus RPI, the Performance Percentage shall be
calculated on a straight line basis between 25% and 100%. 

 Shortened Performance Period Notwithstanding the above, where the
Performance Condition is to be measured over a shortened Performance Period for any reason (including pursuant to rules 6.4 and 8.2) the Committee may make such adjustments to the Performance Condition as it, in its absolute discretion, considers
appropriate so that the outcome fairly reflects the underlying financial performance of the Company over that shortened Performance Period. 
  

	C.	 CASH FLOW FROM OPERATING ACTIVITIES 

 

	(a)	 If the aggregate OpCF achieved over the Performance Period is equal to: 

 

	 	(i)	 US$4.983 billion, the Performance Percentage shall be 100%; 

 

	 	(ii)	 US$4.423 billion, the Performance Percentage shall be 25%; 

 

	 	(iii)	 below US$4.423 billion, the Performance Percentage shall be zero; and 

 

	(b)	 for aggregate OpCF that falls in between US$4.423 billion and US$4.983 billion the Performance
Percentage shall be calculated on a straight line basis between 25% and 100% respectively. 

 Shortened Performance Period
Notwithstanding the above, where the Performance Condition is to be measured over a shortened Performance Period for any reason (including pursuant to rules 6.4 and 8.2) the Committee may make such adjustments to the Performance Condition as it, in
its absolute discretion, considers appropriate so that the outcome fairly reflects the underlying financial performance of the Company over that shortened Performance Period. 

  
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 The following expressions apply for the purposes of determining whether the above conditions are satisfied.

  

			
	Basis Year	  	in relation to the Company, the Financial Year ending immediately before that in which the Date of Grant of the Award occurs;
		
	Comparator Company	  	each of the companies in the Comparator Group that are quoted on the London Stock Exchange at the end of the Performance Period;
		
	Comparator Group	  	means those companies comprising the FTSE 100 Index at the beginning of the Performance Period;
		
	CSR	  	the total shareholder return of each Comparator Company calculated over the Performance Period in the manner specified in Schedule 2;
		
	EPS	  	 for any Financial Year, the Company’s earnings per Share calculated in such manner as the Committee shall specify at the Date of Grant
provided that the Committee may:
 (a) adjust the figure for earnings per share as calculated in accordance with the relevant accounting standard to arrive
at a figure which reflects the underlying business performance of the Company (and may, without limitation, adjust by excluding any or all extraordinary or exceptional items from the earnings per share calculation); and

(b) ensure that the relevant accounting standard is applied on a consistent basis in respect of years falling within any Performance Period and the Basis
Year;

		
	EPS Growth	  	The percentage growth in EPS from the Basis Year to the last Financial year of the Performance Period;
		
	List	  	a list of the CSR ranked in descending order such that the Comparator Company with the greatest CSR is ranked first in such list and the Comparator Company with the lowest CSR is ranked last in such
list;

  
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	OpCF	  	the Company’s total net cashflow from operating activities for each of the Financial Years of the Performance Period calculated in such manner as the Committee shall specify at the Date of Grant provided that the Committee may
adjust the figure for net cashflow from operating activities as it deems appropriate to ensure that it reflects the underlying business performance of the Company;
		
	Performance Measures	  	TSR, EPS and OpCF, and Performance Measure means any one of them;
		
	Performance Percentage	  	with respect to an Award, means, in respect of each Performance Measure, the percentage derived from the relevant performance schedule appended to the Award Certificate in respect of that Performance Measure for the Performance
Period in respect of that Award (which may be set by the Committee at different levels for different Awards);
		
	Performance Period	  	means, unless foreshortened pursuant to the rules of the Plan and unless the Committee determines otherwise, the period of three consecutive Financial Years beginning with the Financial Year in which the Date of Grant
falls;
		
	RPI	  	the Index of Retail Prices (All Items) published by HM Government adjusted, if necessary, in the event that retail price inflation in the UK during any prescribed period is materially different from that in the countries in which
the Company mainly carries on its business;
		
	TSR	  	the total shareholder return of the Company calculated over the Performance Period, in the manner specified in Schedule 2;
		
	TSR ranking	  	the Company’s ranking within the Comparator Group by reference to TSR and CSR over the Performance Period;

  
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 SCHEDULE 2 

CALCULATION OF TOTAL SHAREHOLDER RETURN 

For the purposes of determining whether and to what extent the TSR Performance Measure has been satisfied, this Schedule sets out the method of calculating
TSR and CSR over the Performance Period. Unless otherwise expressly provided, all words defined in the Plan and Schedule 1 shall bear the same meanings in this Schedule 2 and the following expressions shall have the following meanings respectively.

  

			
	TSR Provider	  	means any reputable independent firm or qualified consultant who is capable of calculating TSR as may be appointed by the Committee from time to time.
		
	Day	  	any working day upon which an RI is calculated.
		
	Return Index	  	the index that reflects movements in share price over a period and dividends reinvested on a net basis (without any associated tax credit) in shares on the ex-dividend date.
		
	RI	  	the Return Index in respect of the Company or a Comparator Company as the context may require but in the event of RI as so defined ceasing to be available in respect of a Comparator Company, that company shall thenceforth cease to
be a Comparator Company unless the Committee determines at its discretion that a substitute measure for RI may be used.

 Calculation of TSR and CSR 

In respect of this Award 
 TSR = (A divided by B) - 1 

Where 
  

			
	A =	  	Z multiplied by the sum of (the RI in respect of the Day on which the Performance Period expires and the RI calculated in respect of each Day intervening between the day on which the Performance Period expires and the day three
calendar months prior to the expiry of the Performance Period);
	B =	  	Y multiplied by the sum of (the RI in respect of the Day on which the Performance Period commences and the RI calculated in respect of each Day intervening between the day on which the Performance Period commences and the day three
calendar months prior to the commencement of the Performance Period);

  
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	Y =	  	the mathematical reciprocal of the number of Days intervening between the commencement of the Performance Period and the Day three calendar months prior to the commencement of the Performance Period including the Day on which the
Performance Period commences; and
		
	Z =	  	the mathematical reciprocal of the number of Days intervening between the expiry of the Performance Period and the Day three calendar months prior to the expiry of the Performance Period including the Day on which the Performance
Period expires.

 Each RI referred to above shall be the RI in respect of the Company. 

CSR of each Comparator Company is calculated using the formula for TSR as specified above save that any reference therein to RI shall be the RI calculated in
respect of the Comparator Company concerned. 
 The Company may at its absolute discretion change or substitute an alternative formula for or otherwise
alter any one or more of the formulae specified herein. 
 RI shall be calculated and provided by and shall continue to be calculated and provided by the
TSR Provider unless and until: 
  

	(a)	 it becomes insolvent within the meaning of the Insolvency Act 1986; 

 

	(b)	 it ceases to produce RI or ceases to produce RI which is in a form acceptable to the Committee; or

  

	(c)	 the Committee in its absolute discretion determines that it shall cease to obtain RI from a TSR Provider.

 In the event that any of paragraphs (a) to (c) above is applicable, the Committee shall obtain subsequent RI or similar measure
from any source which it in its absolute discretion deems appropriate and may make any consequential alterations as it in its absolute discretion deems appropriate to any previous calculations of TSR or otherwise. 

  
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