Document:

Exhibit

EXHIBIT 10.13

SANMINA CORPORATION
2009 INCENTIVE PLAN

(As amended on March 6, 2017)
		
	1.
	Purposes of the Plan.  The purposes of this Plan are:

to attract and retain the best available personnel for positions of substantial responsibility,
to provide additional incentive to Employees, Directors, and Consultants, and
to promote the success of the Company’s business.
The Plan permits the grant of Incentive Stock Options, Nonstatutory Stock Options, Restricted Stock, Restricted Stock Units, Stock Appreciation Rights, Performance Units, Performance Shares and other stock or cash awards as the Administrator may determine.
		
	2.
	Definitions.  As used herein, the following definitions will apply:

(a)    “Accounts Payable Days” means as to any Performance Period the ratio of 365 days to Accounts Payable Turns.
(b)    “Accounts Payable Turns” means as to any Performance Period the ratio of four times the Company’s cost of goods sold for the Performance Period to accounts payable on the last day of the Performance Period, in each case calculated in accordance with GAAP.
(c)    “Administrator” means the Board or any of its Committees as will be administering the Plan, in accordance with Section 4 of the Plan.
(d)    “Affiliate” means any corporation or any other entity (including, but not limited to, partnerships and joint ventures) controlling, controlled by, or under common control with the Company.
(e)    “Annual Revenue” means the Company’s or a business unit’s net sales for the Performance Period, determined in accordance with GAAP.
(f)    “Applicable Laws” means the requirements relating to the administration of equity‐based awards under U.S. state corporate laws, U.S. federal and state securities laws, the Code, any stock exchange or quotation system on which the Common Stock is listed or quoted and the applicable laws of any foreign country or jurisdiction where Awards are, or will be, granted under the Plan.
(g)    “Award” means, individually or collectively, a grant under the Plan of Options, Restricted Stock, Restricted Stock Units, Stock Appreciation Rights, Performance Units (including Performance Units payable in cash), Performance Shares and other stock or cash awards as the Administrator may determine.
(h)    “Award Agreement” means the written or electronic agreement setting forth the terms and provisions applicable to each Award granted under the Plan. The Award Agreement is subject to the terms and conditions of the Plan.
(i)    “Board” means the Board of Directors of the Company.
(j)    “Cash Collections” means the actual cash or other freely negotiable consideration, in any currency, received in satisfaction of accounts receivable created by the sale of any Company products or services.
(k)    “Cash Cycle Days” means the ratio of 365 days to Inventory Turns, plus Days Sales Outstanding minus Accounts Payable Days.
(l)    “Change in Control” means the occurrence of any of the following events:

(i)    A change in the ownership of the Company which occurs on the date that any one person, or more than one person acting as a group, (“Person”) acquires ownership of the stock of the Company that, together with the stock held by such Person, constitutes more than 50% of the total voting power of the stock of the Company; provided, however, that for purposes of this subsection (i), the acquisition of additional stock by any one Person, who is considered to own more than 50% of the total voting power of the stock of the Company will not be considered a Change in Control; or
(ii)    A change in the effective control of the Company which occurs on the date that a majority of members of the Board is replaced during any twelve (12) month period by Directors whose appointment or election is not endorsed by a majority of the members of the Board prior to the date of the appointment or election. For purposes of this clause (ii), if any Person is considered to effectively control the Company, the acquisition of additional control of the Company by the same Person will not be considered a Change in Control; or
(iii)    A change in the ownership of a substantial portion of the Company’s assets which occurs on the date that any Person acquires (or has acquired during the twelve (12) month period ending on the date of the most recent acquisition by such person or persons) assets from the Company that have a total gross fair market value equal to or more than 50% of the total gross fair market value of all of the assets of the Company immediately prior to such acquisition or acquisitions; provided, however, that for purposes of this subsection (iii), the following will not constitute a change in the ownership of a substantial portion of the Company’s assets: (A) a transfer to an entity that is controlled by the Company’s stockholders immediately after the transfer, or (B) a transfer of assets by the Company to: (1) a stockholder of the Company (immediately before the asset transfer) in exchange for or with respect to the Company’s stock, (2) an entity, 50% or more of the total value or voting power of which is owned, directly or indirectly, by the Company, (3) a Person, that owns, directly or indirectly, 50% or more of the total value or voting power of all the outstanding stock of the Company, or (4) an entity, at least 50% of the total value or voting power of which is owned, directly or indirectly, by a Person described in this subsection (iii)(B)(3). For purposes of this subsection (iii), gross fair market value means the value of the assets of the Company, or the value of the assets being disposed of, determined without regard to any liabilities associated with such assets.
(iv)    For purposes of this Section 2(l), persons will be considered to be acting as a group if they are owners of a corporation that enters into a merger, consolidation, purchase or acquisition of stock, or similar business transaction with the Company.
(m)    “Code” means the Internal Revenue Code of 1986, as amended. Any reference to a section of the Code herein will be a reference to any successor or amended section of the Code.
(n)    “Committee” means a committee of Directors or of one or more other individuals satisfying Applicable Laws appointed by the Board in accordance with Section 4 hereof.
(o)    “Common Stock” means the common stock of the Company.
(p)    “Company” means Sanmina Corporation, a Delaware corporation, or any successor thereto.
(q)    “Consultant” means any person, including an advisor, who is (i) engaged by the Company or an Affiliate to render consulting or advisory services and is compensated for such services, or (ii) serving as a member of the Board of Directors of an Affiliate and is compensated for such services. However, service solely as a Director, or payment of a fee for such service, shall not cause a Director to be considered a “Consultant” for purposes of the Plan.
(r)    “Customer Satisfaction MBOs” means as to any Participant, the objective and measurable individual goals set by a “management by objectives” process and approved by the Administrator, which goals relate to the satisfaction of external or internal customer requirements.
(s)    “Days Sales Outstanding” means as to any Performance Period the ratio of accounts receivable, net, on the last day of the Performance Period calculated in accordance with GAAP, to average daily net sales for the Performance Period.
(t)    “Determination Date” means the latest possible date that will not jeopardize the qualification of an Award granted under the Plan as “performance‐based compensation” under Code Section 162(m).
(u)    “Director” means a member of the Board.

(v)    “Disability” means total and permanent disability as defined in Code Section 22(e)(3), provided that in the case of Awards other than Incentive Stock Options, the Administrator in its discretion may determine whether a permanent and total disability exists in accordance with uniform and non‐discriminatory standards adopted by the Administrator from time to time.
(w)    “Earnings Per Share” means as to any Performance Period, the Company’s Net Income or a business unit’s Pro Forma Net Income, divided by a weighted average number of Shares outstanding and dilutive common equivalent Shares deemed outstanding.
(x)    “Employee” means any person, including Officers and Directors, employed by the Company or its Affiliates. Neither service as a Director nor payment of a director’s fee by the Company will be sufficient to constitute “employment” by the Company.
(y)    “Exchange Act” means the Securities Exchange Act of 1934, as amended.
(z)    “Fair Market Value” means, as of any date the value of Common Stock determined as follows:
(i)    If the Common Stock is listed on any established stock exchange or a national market system, including without limitation the New York Stock Exchange, the Nasdaq Global Market, the Nasdaq Global Select Market or the Nasdaq Capital Market, its Fair Market Value will be the closing sales price for such stock (or the closing bid, if no sales were reported) as quoted on such exchange or system for such date, as reported in The Wall Street Journal or such other source as the Administrator deems reliable;
(ii)    If the Common Stock is regularly quoted by a recognized securities dealer but selling prices are not reported, the Fair Market Value of a Share of Common Stock will be the mean between the high bid and low asked prices for the Common Stock for such date, as reported in The Wall Street Journal or such other source as the Administrator deems reliable; or
(iii)    In the absence of an established market for the Common Stock, the Fair Market Value will be determined in good faith by the Administrator.
(iv)    Notwithstanding the preceding, for federal, state, and local income tax reporting purposes and for such other purposes as the Administrator deems appropriate, the Fair Market Value shall be determined by the Administrator in accordance with uniform and nondiscriminatory standards adopted by it from time to time.
(aa)    “Fiscal Year” means the fiscal year of the Company.
(bb)    “Free Cash Flow” means as to any Performance Period the combination of cash provided by (used in) operations of the Company and cash provided by (used in) investing activities of the Company, in each case determined in accordance with GAAP.
(cc)    “GAAP” means United States Generally Accepted Accounting Principles.
(dd)    “Gross Margin” means as to any Performance Period Gross Profit of the Company or any business unit divided by gross revenue of the Company or such business unit, in each case determined in accordance with GAAP.
(ee)    “Gross Profit” means as to any Performance Period the difference between gross revenue of the Company or any business unit and cost of goods sold of the Company or such business unit, in each case determined in accordance with GAAP.
(ff)    “Incentive Stock Option” means an Option that by its terms qualifies and is otherwise intended to qualify as an incentive stock option within the meaning of Code Section 422 and the regulations promulgated thereunder.
(gg)    “Inventory Turns” means as to any Performance Period the ratio of four times cost of goods sold for the Performance Period to inventory on the last day of the Performance Period, in each case calculated in accordance with GAAP.
(hh)    “Net Income” means as to any Performance Period, the income after taxes of the Company determined in accordance with GAAP.

(ii)    “New Orders” means as to any Performance Period, the firm orders for a system, product, part, or service that are being recorded for the first time as defined in the Company’s order recognition policy.
(jj)    “Nonstatutory Stock Option” means an Option that by its terms does not qualify or is not intended to qualify as an Incentive Stock Option.
(kk)    “Officer” means a person who is an officer of the Company within the meaning of Section 16 of the Exchange Act and the rules and regulations promulgated thereunder.
(ll)    “Operating Income” means as to any Performance Period, the difference between Gross Profit and operating expenses, determined in accordance with GAAP.
(mm)    “Option” means a stock option granted pursuant to Section 6 of the Plan.
(nn)    “Outside Director” means a Director who is not an Employee.
(oo)    “Parent” means a “parent corporation,” whether now or hereafter existing, as defined in Code Section 424(e).
(pp)    “Participant” means the holder of an outstanding Award.
(qq)    “Performance‐Based Award” means any Awards that are subject to the terms and conditions set forth in Section 13. All Performance‐ Based Awards are intended to qualify as qualified performance‐based compensation under Code Section 162(m).
(rr)    “Performance Bonus Award” means a cash award set forth in Section 12.
(ss)    “Performance Goals” will have the meaning set forth in Section 11 of the Plan.
(tt)    “Performance Period” means any Fiscal Year of the Company or such other period as determined by the Administrator in its sole discretion.
(uu)    “Performance Share” means an Award denominated in Shares which may be earned in whole or in part upon attainment of Performance Goals or other vesting criteria as the Administrator may determine pursuant to Section 10.
(vv)    “Performance Unit” means an Award which may be earned in whole or in part upon attainment of Performance Goals or other vesting criteria as the Administrator may determine and which, in the Administrator’s sole discretion, may be settled for cash, Shares or other securities or a combination of the foregoing pursuant to Section 10, in the Administrator’s sole discretion.
(ww)    “Period of Restriction” means the period during which the transfer of Shares of Restricted Stock are subject to restrictions and therefore, the Shares are subject to a substantial risk of forfeiture. Such restrictions may be based on the passage of time, the achievement of target levels of performance, or the occurrence of other events as determined by the Administrator.
(xx)    “Plan” means this 2009 Incentive Plan.
(yy)    “Pro Forma Net Income” means as to any business unit for any Performance Period, the Net Income of such business unit, minus allocations of designated corporate expenses.
(zz)    “Product Shipments” means as to any Performance Period, the quantitative and measurable number of units of a particular product that shipped during such Performance Period.
(aaa)    “Restricted Stock” means Shares issued pursuant to an Award of Restricted Stock under Section 8 of the Plan, or issued pursuant to the early exercise of an Option.
(bbb)    “Restricted Stock Unit” means a bookkeeping entry representing an amount equal to the Fair Market Value of one Share, granted pursuant to Section 9. Each Restricted Stock Unit represents an unfunded and unsecured obligation of the Company.

(ccc)    “Return on Designated Assets” means as to any Performance Period, the Pro Forma Net Income of a business unit, divided by the average of beginning and ending business unit designated assets, or Net Income of the Company, divided by the average of beginning and ending designated corporate assets.
(ddd)    “Return on Equity” means, as to any Performance Period, the percentage equal to the value of the Company’s or any business unit’s common stock investments at the end of such Performance Period, divided by the value of such common stock investments at the start of such Performance Period, excluding any common stock investments so designated by the Administrator.
(eee)    “Return on Sales” means as to any Performance Period, the percentage equal to the Company’s Net Income or the business unit’s Pro Forma Net Income, divided by the Company’s or the business unit’s Annual Revenue.
(fff)    “Rule 16b‐3” means Rule 16b‐3 of the Exchange Act or any successor to Rule 16b‐3, as in effect when discretion is being exercised with respect to the Plan.
(ggg)    “Section 16(b)” means Section 16(b) of the Exchange Act.
(hhh)    “Service Provider” means an Employee, Director or Consultant.
(iii)    “Share” means a share of the Common Stock, as adjusted in accordance with Section 1516 of the Plan.
(jjj)    “Stock Appreciation Right” means an Award, granted alone or in connection with an Option, that pursuant to Section 7 is designated as a Stock Appreciation Right.
(kkk)    “Subsidiary” means a “subsidiary corporation,” whether now or hereafter existing, as defined in Code Section 424(f).
(lll)    “Successor Corporation” has the meaning given to such term in Section 18(c) of the Plan.
		
	3.
	Stock Subject to the Plan.

(a)  Stock Subject to the Plan.  Subject to the provisions of Section 18 of the Plan, the maximum aggregate number of Shares that may be awarded and sold under the Plan is 23,500,000 Shares. The Shares may be authorized, but unissued, or reacquired Common Stock.
(b)  Full Value Awards.  Any Shares subject to Awards other than Options or Stock Appreciation Rights will be counted against the numerical limits of this Section 3 as 1.36 Shares for every one Share subject thereto. Further, if Shares acquired pursuant to any such Award are forfeited or repurchased by the Company and would otherwise return to the Plan pursuant to Section 3(c), 1.36 times the number of Shares so forfeited or repurchased will return to the Plan and will again become available for issuance.
(c)  Lapsed Awards.  If an Award expires or becomes unexercisable without having been exercised in full, or, with respect to Restricted Stock, Restricted Stock Units, Performance Shares or Performance Units which are to be settled in Shares, is forfeited to or repurchased by the Company, the unpurchased Shares (or for Awards other than Options and Stock Appreciation Rights, the forfeited or repurchased Shares) which were subject thereto will become available for future grant or sale under the Plan (unless the Plan has terminated). Upon exercise of a Stock Appreciation Right settled in Shares, the gross number of Shares covered by the portion of the Award so exercised will cease to be available under the Plan. If unvested Shares of Restricted Stock, or unvested Shares issued pursuant to Awards of Restricted Stock Units, Performance Shares or Performance Units are repurchased by or forfeited to the Company, such Shares will become available for future grant under the Plan. Shares used to pay the tax and exercise price of an Award will not become available for future grant or sale under the Plan. To the extent an Award under the Plan is paid out in cash rather than Shares, such cash payment will not result in reducing the number of Shares available for issuance under the Plan. Notwithstanding the foregoing and, subject to adjustment provided in Section 18, the maximum number of Shares that may be issued upon the exercise of Incentive Stock Options will equal the aggregate Share number stated in Section 3(a), plus, to the extent allowable under Code Section 422, any Shares that become available for issuance under the Plan under this Section 3(b).
(d)  Share Reserve.  The Company, during the term of this Plan, will at all times reserve and keep available such number of Shares as will be sufficient to satisfy the requirements of the Plan.

		
	4.
	Administration of the Plan.

(a)    Procedure.
(i)  Multiple Administrative Bodies.  Different Committees with respect to different groups of Service Providers may administer the Plan.
(ii)  Section 162(m).  To the extent that the Administrator determines it to be desirable to qualify Awards granted hereunder as “performance‐based compensation” within the meaning of Code Section 162(m), the Plan will be administered by a Committee of two or more “outside directors” within the meaning of Code Section 162(m).
(iii)  Rule 16b‐3.  To the extent desirable to qualify transactions hereunder as exempt under Rule 16b‐3, the transactions contemplated hereunder will be structured to satisfy the requirements for exemption under Rule 16b‐3.
(iv)  Delegation to an Officer.  The Board may delegate to one or more Officers of the Company the authority to do one or both of the following (i) designate Employees or Consultants of the Company or any of its Subsidiaries who are not Officers to be recipients of Options, Restricted Stock and Restricted Stock Units and the terms thereof, and (ii) determine the number of shares of Common Stock to be subject to such Awards granted to such Employees and Consultants; provided, however, that the Board resolutions regarding such delegation shall specify the total number of shares of Common Stock that may be subject to the Awards granted by such Officer. Notwithstanding anything to the contrary in this Section 4(a), the Board may not delegate to an Officer authority to determine the Fair Market Value of the Common Stock pursuant to Section 4(b) below.
(v)  Other Administration.  Other than as provided above, the Plan will be administered by (A) the Board or (B) a Committee, which committee will be constituted to satisfy Applicable Laws.
(b)  Powers of the Administrator.  Subject to the provisions of the Plan, and in the case of a Committee, subject to the specific duties delegated by the Board to such Committee, the Administrator will have the authority, in its discretion:
(i)    to determine the Fair Market Value;
(ii)    to select the Service Providers to whom Awards may be granted hereunder;
(iii)    to determine the terms and conditions, not inconsistent with the terms of the Plan, of any Award granted hereunder;
(iv)    to construe and interpret the terms of the Plan and Awards granted pursuant to the Plan;
(v)    to prescribe, amend and rescind rules and regulations relating to the Plan, including rules and regulations relating to sub‐plans established for the purpose of satisfying applicable foreign laws;
(vi)    to modify or amend each Award (subject to Section 23(c) of the Plan). Notwithstanding the previous sentence, the Administrator may not modify or amend an Option or Stock Appreciation Right to reduce the exercise price of such Option or Stock Appreciation Right after it has been granted (except for adjustments made pursuant to Section 18), and neither may the Administrator cancel any outstanding Option or Stock Appreciation Right in exchange for cash, other awards or an Option or Stock Appreciation Right with an exercise price that is less than the exercise price of the original Option or Stock Appreciation Right, unless such action is approved by stockholders prior to such action being taken;
(vii)    to authorize any person to execute on behalf of the Company any instrument required to effect the grant of an Award previously granted by the Administrator;
(viii)    to allow a Participant to defer the receipt of the payment of cash or the delivery of Shares that would otherwise be due to such Participant under an Award pursuant to such procedures as the Administrator may determine; and
(ix)    to make all other determinations deemed necessary or advisable for administering the Plan.

(c)  Effect of Administrator’s Decision.  The Administrator’s decisions, determinations and interpretations will be final and binding on all Participants and any other holders of Awards.
5.    Eligibility.  Nonstatutory Stock Options, Stock Appreciation Rights, Restricted Stock, Restricted Stock Units, Performance Units, Performance Shares and such other cash or stock awards as the Administrator determines may be granted to Service Providers. Incentive Stock Options may be granted only to employees of the Company or any Parent or Subsidiary of the Company.
		
	6.
	Stock Options.

(a)  Limitations.  Each Option will be designated in the Award Agreement as either an Incentive Stock Option or a Nonstatutory Stock Option. However, notwithstanding such designation, to the extent that the aggregate Fair Market Value of the Shares with respect to which Incentive Stock Options are exercisable for the first time by the Participant during any calendar year (under all plans of the Company and any Parent or Subsidiary) exceeds $100,000, such Options will be treated as Nonstatutory Stock Options. For purposes of this Section 6(a), Incentive Stock Options will be taken into account in the order in which they were granted. The Fair Market Value of the Shares will be determined as of the time the Option with respect to such Shares is granted.
(b)  Number of Shares.  The Administrator will have complete discretion to determine the number of Shares subject to an Option granted to any Participant, provided that during any Fiscal Year, no Participant will be granted an Option covering more than 833,333 Shares. Notwithstanding the limitation in the previous sentence, an Employee may be granted Options covering up to an additional 833,333 Shares during the fiscal year in which his or her initial service as an Employee begins.
(c)  Term of Option.  The Administrator will determine the term of each Option in its sole discretion; provided, however, that the term will be no more than ten (10) years from the date of grant thereof. Moreover, in the case of an Incentive Stock Option granted to a Participant who, at the time the Incentive Stock Option is granted, owns stock representing more than ten percent (10%) of the total combined voting power of all classes of stock of the Company or any Parent or Subsidiary, the term of the Incentive Stock Option will be five (5) years from the date of grant or such shorter term as may be provided in the Award Agreement.
(d)    Option Exercise Price and Consideration.
(i)    Exercise Price.  The per share exercise price for the Shares to be issued pursuant to exercise of an Option will be determined by the Administrator, but will be no less than 100% of the Fair Market Value per Share on the date of grant. In addition, in the case of an Incentive Stock Option granted to an Employee who, at the time the Incentive Stock Option is granted, owns stock representing more than ten percent (10%) of the voting power of all classes of stock of the Company or any Parent or Subsidiary, the per Share exercise price will be no less than 110% of the Fair Market Value per Share on the date of grant. Notwithstanding the foregoing provisions of this Section 6(c), Options may be granted with a per Share exercise price of less than 100% of the Fair Market Value per Share on the date of grant pursuant to a transaction described in, and in a manner consistent with, Code Section 424(a).
(ii)    Waiting Period and Exercise Dates.  At the time an Option is granted, the Administrator will fix the period within which the Option may be exercised and will determine any conditions that must be satisfied before the Option may be exercised.
(iii)    Form of Consideration.  The Administrator will determine the acceptable form(s) of consideration for exercising an Option, including the method of payment, to the extent permitted by Applicable Laws, which forms of consideration shall be set forth in the Award Agreement at the time of grant.
(e)    Exercise of Option.
(i)  Procedure for Exercise; Rights as a Stockholder.  Any Option granted hereunder will be exercisable according to the terms of the Plan and at such times and under such conditions as determined by the Administrator and set forth in the Award Agreement. An Option may not be exercised for a fraction of a Share.
An Option will be deemed exercised when the Company receives: (i) notice of exercise (in such form as the Administrator specifies from time to time) from the person entitled to exercise the Option, and (ii) full payment for the Shares with respect to which the Option is exercised (together with any applicable withholding taxes). No adjustment 

will be made for a dividend or other right for which the record date is prior to the date the Shares are issued, except as provided in Section 18 of the Plan.
(ii)  Termination of Relationship as a Service Provider.  If a Participant ceases to be a Service Provider, other than upon the Participant’s termination as the result of the Participant’s death or Disability, the Participant may exercise his or her Option within such period of time as is specified in the Award Agreement to the extent that the Option is vested on the date of termination (but in no event later than the expiration of the term of such Option as set forth in the Award Agreement). In the absence of a specified time in the Award Agreement, the Option will remain exercisable for ninety (90) days following the Participant’s termination. Unless otherwise provided by the Administrator, if on the date of termination the Participant is not vested as to his or her entire Option, the Shares covered by the unvested portion of the Option will revert to the Plan. If after termination the Participant does not exercise his or her Option within the time specified by the Administrator, the Option will terminate, and the Shares covered by such Option will revert to the Plan.
(iii)  Disability of Participant.  If a Participant ceases to be a Service Provider as a result of the Participant’s Disability, the Participant may exercise his or her Option within such period of time as is specified in the Award Agreement to the extent the Option is vested on the date of termination (but in no event later than the expiration of the term of such Option as set forth in the Award Agreement). In the absence of a specified time in the Award Agreement, the Option will remain exercisable for five (5) years following the Participant’s termination. Unless otherwise provided by the Administrator, if on the date of termination the Participant is not vested as to his or her entire Option, the Shares covered by the unvested portion of the Option will revert to the Plan. If after termination the Participant does not exercise his or her Option within the time specified herein, the Option will terminate, and the Shares covered by such Option will revert to the Plan.
(iv)  Death of Participant.  If a Participant dies while a Service Provider, the Option may be exercised following the Participant’s death within such period of time as is specified in the Award Agreement to the extent of all of the shares subject to the Option, including Shares that had not yet vested on the date of death (but in no event may the option be exercised later than the expiration of the term of such Option as set forth in the Award Agreement), by the Participant’s designated beneficiary, provided such beneficiary has been designated in a form acceptable to the Administrator. If no such beneficiary has been designated by the Participant, then such Option may be exercised by the personal representative of the Participant’s estate or by the person(s) to whom the Option is transferred pursuant to the Participant’s will or in accordance with the laws of descent and distribution. In the absence of a specified time in the Award Agreement, the Option will remain exercisable for five (5) years following Participant’s death. If the Option is not so exercised within the time specified herein, the Option will terminate, and the Shares covered by such Option will revert to the Plan.
(v)  Other Termination.  A Participant’s Award Agreement may also provide that if the exercise of the Option following the termination of Participant’s status as a Service Provider (other than upon the Participant’s death or Disability) would result in liability under Section 16(b), then the Option will terminate on the earlier of (A) the expiration of the term of the Option set forth in the Award Agreement, or (B) the 10th day after the last date on which such exercise would result in such liability under Section 16(b). Finally, a Participant’s Award Agreement may also provide that if the exercise of the Option following the termination of the Participant’s status as a Service Provider (other than upon the Participant’s death or Disability) would be prohibited at any time solely because the issuance of Shares would violate the registration requirements under the Securities Act, then the Option will terminate on the earlier of (A) the expiration of the term of the Option, or (B) the expiration of a period of ninety (90) days after the termination of the Participant’s status as a Service Provider during which the exercise of the Option would not be in violation of such registration requirements.
		
	7.
	Stock Appreciation Rights.

(a)  Grant of Stock Appreciation Rights.  Subject to the terms and conditions of the Plan, a Stock Appreciation Right may be granted to Service Providers at any time and from time to time as will be determined by the Administrator, in its sole discretion.
(b)  Number of Shares.  The Administrator will have complete discretion to determine the number of Stock Appreciation Rights granted to any Participant, provided that during any Fiscal Year, no Participant will be granted Stock Appreciation Rights covering more than 833,333 Shares. Notwithstanding the limitation in the previous sentence, an Employee may be granted Stock Appreciation Rights covering up to an additional 833,333 Shares during the fiscal year in which his or her initial service as an Employee begins.

(c)  Exercise Price and Other Terms.  The Administrator, subject to the provisions of the Plan, will have complete discretion to determine the terms and conditions of Stock Appreciation Rights granted under the Plan, provided, however, that the exercise price will be not less than 100% of the Fair Market Value of a Share on the date of grant.
(d)  Stock Appreciation Right Agreement.  Each Stock Appreciation Right grant will be evidenced by an Award Agreement that will specify the exercise price, the term of the Stock Appreciation Right, the conditions of exercise, and such other terms and conditions as the Administrator, in its sole discretion, will determine.
(e)  Expiration of Stock Appreciation Rights.  A Stock Appreciation Right granted under the Plan will expire upon the date determined by the Administrator, in its sole discretion, and set forth in the Award Agreement; provided, however, that the term will be no more than ten (10) years from the date of grant thereof. Notwithstanding the foregoing, the rules of Section 6(e) also will apply to Stock Appreciation Rights.
(f)  Payment of Stock Appreciation Right Amount.  Upon exercise of a Stock Appreciation Right, a Participant will be entitled to receive payment from the Company in an amount determined by multiplying:
(i)    The difference between the Fair Market Value of a Share on the date of exercise over the exercise price; times
(ii)    The number of Shares with respect to which the Stock Appreciation Right is exercised.
At the discretion of the Administrator, the payment upon Stock Appreciation Right exercise may be in cash, in Shares of equivalent value, or in some combination thereof.
(g)  Dividends and Other Distributions.  Service Providers holding unvested Stock Appreciation Rights shall not be entitled to receive dividends or other distributions in respect of such Awards until the time specified for payout of the Stock Appreciation Rights in the Award Agreement.
		
	8.
	Restricted Stock.

(a)  Grant of Restricted Stock.  Subject to the terms and provisions of the Plan, the Administrator, at any time and from time to time, may grant Shares of Restricted Stock to Service Providers in such amounts as the Administrator, in its sole discretion, will determine.
(b)  Restricted Stock Agreement.  Each Award of Restricted Stock will be evidenced by an Award Agreement that will specify the Period of Restriction, the number of Shares granted, and such other terms and conditions as the Administrator, in its sole discretion, will determine. Notwithstanding the foregoing sentence, for Restricted Stock intended to qualify as “performance‐ based compensation” within the meaning of Code Section 162(m), during any Fiscal Year no Participant will receive more than an aggregate of 333,333 Shares of Restricted Stock. Notwithstanding the foregoing limitation, for restricted stock intended to qualify as “performance‐based compensation” within the meaning of Code Section 162(m), an Employee may be granted up to 333,333 additional Shares of Restricted Stock during the fiscal year in which his or her initial service as an Employee begins. Unless the Administrator determines otherwise, Shares of Restricted Stock will be held by the Company as escrow agent until the restrictions on such Shares have lapsed.
(c)  Transferability.  Except as provided in this Section 16, Shares of Restricted Stock may not be sold, transferred, pledged, assigned, or otherwise alienated or hypothecated until the end of the applicable Period of Restriction.
(d)  Other Restrictions.  The Administrator, in its sole discretion, may impose such other restrictions on Shares of Restricted Stock as it may deem advisable or appropriate and contained in the Award Agreement on the date of grant, including granting an Award of Restricted Stock subject to the requirements of Section 13.
(e)  Removal of Restrictions.  Except as otherwise provided in this Section 8, Shares of Restricted Stock covered by each Restricted Stock grant made under the Plan will be released from escrow as soon as practicable after the last day of the Period of Restriction. The Administrator, in its discretion, may accelerate the time at which any restrictions will lapse or be removed.
(f)  Voting Rights.  During the Period of Restriction, Service Providers holding Shares of Restricted Stock granted hereunder may exercise full voting rights with respect to those Shares, unless the Administrator determines otherwise.
(g)  Dividends and Other Distributions.  During the Period of Restriction, Service Providers holding Shares of Restricted Stock will be entitled to receive all dividends and other distributions paid with respect to such Shares unless otherwise provided in the Award Agreement. If any such dividends or distributions are paid in Shares, the Shares will be subject 

to the same restrictions on transferability and forfeitability as the Shares of Restricted Stock with respect to which they were paid.
(h)  Return of Restricted Stock to Company.  On the date set forth in the Award Agreement, the Restricted Stock for which restrictions have not lapsed will revert to the Company and again will become available for grant under the Plan.
(i)  Section 162(m) Performance Restrictions.  For purposes of qualifying grants of Performance Units/Shares as “performance‐based compensation” under Code Section 162(m), the Compensation Committee, in its discretion, may set restrictions based upon the achievement of Performance Goals. The Performance Goals will be set by the Compensation Committee on or before the Determination Date. In granting Performance Units/Shares which are intended to qualify under Code Section 162(m), the Compensation Committee will follow the provisions of Section 13 any procedures determined by it from time to time to be necessary or appropriate to ensure qualification of the Award under Code Section 162(m) (e.g., in determining the Performance Goals).
		
	9.
	Restricted Stock Units.

(a)  Grant.  Restricted Stock Units may be granted at any time and from time to time as determined by the Administrator. Each Restricted Stock Unit grant will be evidenced by an Award Agreement that will specify such other terms and conditions as the Administrator, in its sole discretion, will determine, including all terms, conditions, and restrictions related to the grant, the number of Restricted Stock Units and the form of payout, which, subject to Section 9(d), may be left to the discretion of the Administrator. Notwithstanding anything to the contrary in this subsection (a), for Restricted Stock Units intended to qualify as “performance‐based compensation” within the meaning of Code Section 162(m), during any Fiscal Year of the Company, no Participant will receive more than an aggregate of 333,333 Restricted Stock Units. Notwithstanding the foregoing limitation, for Restricted Stock Units intended to qualify as “performance‐based compensation” within the meaning of Code Section 162(m), an Employee may be granted up to 333,333 additional Restricted Stock Units during the fiscal year in which his or her initial service as an Employee begins.
(b)  Vesting Criteria and Other Terms.  The Administrator will set vesting criteria in its discretion, which, depending on the extent to which the criteria are met, will determine the number of Restricted Stock Units that will be paid out to the Participant, including granting an Award of Restricted Stock Units subject to the requirements of Section 13. After the grant of Restricted Stock Units, the Administrator, in its sole discretion, may reduce or waive any restrictions for such Restricted Stock Units. Each Award of Restricted Stock Units will be evidenced by an Award Agreement that will specify the vesting criteria, and such other terms and conditions as the Administrator, in its sole discretion, will determine.
(c)  Earning Restricted Stock Units.  Upon meeting the applicable vesting criteria, the Participant will be entitled to receive a payout as specified in the Award Agreement. Notwithstanding the foregoing, at any time after the grant of Restricted Stock Units, the Administrator, in its sole discretion, may reduce or waive any vesting criteria that must be met to receive a payout.
(d)  Form and Timing of Payment.  Payment of earned Restricted Stock Units will be made as soon as practicable after the date(s) set forth in the Award Agreement. The Administrator, in its sole discretion, may pay earned Restricted Stock Units in cash, Shares, or a combination thereof. Shares represented by Restricted Stock Units that are fully paid in cash again will be available for grant under the Plan.
(e)  Cancellation.  On the date set forth in the Award Agreement, all unearned Restricted Stock Units will be forfeited to the Company.
(f)  Section 162(m) Performance Restrictions.  For purposes of qualifying grants of Performance Units/Shares as “performance‐based compensation” under Code Section 162(m), the Compensation Committee, in its discretion, may set restrictions based upon the achievement of Performance Goals. The Performance Goals will be set by the Compensation Committee on or before the Determination Date. In granting Performance Units/Shares which are intended to qualify under Code Section 162(m), the Compensation Committee will follow the provisions of Section 13 any procedures determined by it from time to time to be necessary or appropriate to ensure qualification of the Award under Code Section 162(m) (e.g., in determining the Performance Goals).
		
	10.
	Performance Units and Performance Shares.

(a)  Grant of Performance Units/Shares.  Performance Units and Performance Shares may be granted to Service Providers at any time and from time to time, as will be determined by the Administrator, in its sole discretion. The Administrator will have complete discretion in determining the number of Performance Units/Shares granted to each 

Participant provided that during any Fiscal Year, for Performance Units or Performance Shares intended to qualify as “performance‐based compensation” within the meaning of Code Section 162(m), (i) no Participant will receive Performance Units having an initial value greater than $5,000,000, and (ii) no Participant will receive more than 333,333 Performance Shares. Notwithstanding the foregoing limitation, for Performance Shares intended to qualify as “performance‐based compensation” within the meaning of Code Section 162(m), in connection with his or her initial service, a Service Provider may be granted up to an additional 333,333 Performance Shares and additional Performance Units having an initial value up to $5,000,000.
(b)  Value of Performance Units/Shares.  Each Performance Unit will have an initial value that is established by the Administrator on or before the date of grant. Each Performance Share will have an initial value equal to the Fair Market Value of a Share on the date of grant.
(c)  Performance Objectives and Other Terms.  The Administrator will set Performance Goals or other vesting provisions (including, without limitation, continued status as a Service Provider) in its discretion which, depending on the extent to which they are met, will determine the number or value of Performance Units/Shares that will be paid out to the Participant, including granting an Award of Performance Units and Performance Shares subject to the requirements of Section 13. The Administrator may set performance objectives based upon the achievement of Company‐wide, divisional, or individual goals, or any other basis determined by the Administrator in its discretion. Each Award of Performance Units/Shares will be evidenced by an Award Agreement that will specify the Performance Period, Performance Goals, any other vesting provisions and such other terms and conditions as the Administrator, in its sole discretion, will determine.
(d)  Earning of Performance Units/Shares.  After the applicable Performance Period has ended, the holder of Performance Units/Shares will be entitled to receive a payout of the number of Performance Units/Shares earned by the Participant over the Performance Period, to be determined as a function of the extent to which the corresponding performance objectives or other vesting provisions have been achieved. After the grant of a Performance Unit/Share, the Administrator, in its sole discretion, may reduce or waive any performance objectives or other vesting provisions for such Performance Unit/Share.
(e)  Form and Timing of Payment of Performance Units/Shares.  Payment of earned Performance Units/Shares will be made as soon as practicable after the expiration of the applicable Performance Period and achievement of the performance criteria and other vesting provisions. The Administrator, in its sole discretion, may pay earned Performance Units/Shares in the form of cash, in Shares (which have an aggregate Fair Market Value equal to the value of the earned Performance Units/Shares at the close of the applicable Performance Period) or in a combination thereof.
(f)  Cancellation of Performance Units/Shares.  On the date set forth in the Award Agreement, all unearned or unvested Performance Units/Shares will be forfeited to the Company, and again will be available for grant under the Plan to the extent such Performance Units/Shares were payable in Shares.
(g)  Section 162(m) Performance Restrictions.  For purposes of qualifying grants of Performance Units/Shares as “performance‐based compensation” under Code Section 162(m), the Compensation Committee, in its discretion, may set restrictions based upon the achievement of Performance Goals. The Performance Goals will be set by the Compensation Committee on or before the Determination Date. In granting Performance Units/Shares which are intended to qualify under Code Section 162(m), the Compensation Committee will follow the provisions of Section 13 any procedures determined by it from time to time to be necessary or appropriate to ensure qualification of the Award under Code Section 162(m) (e.g., in determining the Performance Goals).
11.    Performance Goals.  The granting and/or vesting of Awards of Options, Restricted Stock, Restricted Stock Units, Performance Shares and Performance Units (including Performance Units payable in cash) and other incentives under the Plan may be made subject to the attainment of performance goals (“Performance Goals”) relating to one or more of the following measures: (a) Accounts Payable Days, (b) Accounts Payable Turns, (c) Annual Revenue, (d) Cash Collections, (e) Cash Cycle Days, (f) Customer Satisfaction MBOs, (g) Days Sales Outstanding, (h) Earnings Per Share, (i) Free Cash flow, (j) Gross Margin, (k) Gross Profit, (l) Inventory Turns, (m) Net Income, (n) New Orders, (o) Operating Income, (p) Pro Forma Net Income, (q) Return on Designated Assets, (r) Return on Equity, (s) Return on Sales, and (t) Product Shipments. Any Performance Goals may be used to measure the performance of the Company as a whole or a business unit of the Company and may be measured relative to a peer group or index. The Performance Goals may differ from Participant to Participant and from Award to Award. The Compensation Committee may provide that partial achievement of the Performance Goals may result in the payment or vesting corresponding to a partial (but not necessarily proportional) portion of the Award. Prior to the Determination Date, the Compensation Committee is authorized to make adjustments in the method of calculating the attainment of Performance Goals for a Performance Period as follows: (i) to exclude restructuring and integration charges (including employee severance and benefits costs and charges related to excess facilities and assets); (ii) to exclude impairment 

charges for goodwill and intangible assets and amortization expense; (iii) to exclude exchange rate effects, as applicable, for non‐U.S. dollar denominated net sales and operating earnings; (iv) to exclude the effects of changes to GAAP required by the Financial Accounting Standards Board; (v) to exclude the effects of any statutory adjustments to corporate tax rates; (vi) to exclude stock‐based compensation expense determined under generally accepted accounting principles; (vii) to exclude any other unusual, non‐recurring gain or loss or extraordinary item; (vii) to respond to, or in anticipation of, any unusual or extraordinary corporate item, transaction, event or development; (viii) to respond to, or in anticipation of, changes in applicable laws, regulations, accounting principles, or business conditions; (ix) to exclude the dilutive effects of acquisitions or joint ventures; (x) to assume that any business divested by the Company achieved performance objectives at targeted levels during the balance of a Performance Period following such divestiture; (xi) to reflect a corporate transaction, such as a merger, consolidation, separation (including a spinoff or other distribution of stock or property by a corporation), or reorganization (whether or not such reorganization comes within the definition of such term in Code Section 368); and (xii) to reflect any partial or complete corporate liquidation. The Compensation Committee also retains the discretion to reduce or eliminate the compensation or economic benefit due upon attainment of Performance Goals.
12.    Performance Bonus Awards.  Any Service Provider selected by the Compensation Committee may be granted one or more Performance‐Based Awards in the form of a cash bonus payable upon the attainment of Performance Goals that are established by the Compensation Committee for a Performance Period prior to the Determination Date. Performance‐Based Awards in the form of cash bonuses may not exceed more than $5,000,000 in any Fiscal Year. Performance Bonus Awards established for any Participant who would be considered a “covered employee” within the meaning of Code Section 162(m) (hereinafter a “Covered Employee”) will be based upon Performance Goals established in accordance with Section 13. The provisions contained in this Plan permitting the Company to grant Performance‐Based Awards in the form of cash bonuses shall not be the exclusive means for the payment of bonuses or other incentive compensation to Participants, including Covered Employees.
		
	13.
	Terms and Conditions of Any Performance‐Based Award.

(a)  Purpose.  The purpose of this Section 13 is to provide the Compensation Committee of the Board (the “Compensation Committee”) the ability to qualify Awards (other than Options and SARs) that are granted pursuant to the Plan as qualified performance‐based compensation under Code Section 162(m). If the Compensation Committee, in its discretion, decides to grant a Performance‐Based Award subject to Performance Goals to a Covered Employee, the provisions of this Section 13 will control over any contrary provision in the Plan; provided, however, that the Compensation Committee may in its discretion grant Awards that are not intended to qualify as “performance‐ based compensation” under Code Section 162(m) to such Participants that are based on Performance Goals or other specific criteria or goals but that do not satisfy the requirements of this Section 13.
(b)  Applicability.  This Section 13 will apply to those Covered Employees who are selected by the Compensation Committee to receive any Award subject to Performance Goals. The designation of a Covered Employee as being subject to Code Section 162(m) will not in any manner entitle the Covered Employee to receive an Award under the Plan. Moreover, designation of a Covered Employee subject to Code Section 162(m) for a particular Performance Period will not require designation of such Covered Employee in any subsequent Performance Period and designation of one Covered Employee will not require designation of any other Covered Employee in such period or in any other period.
(c)  Procedures with Respect to Performance Based Awards.  To the extent necessary to comply with the performance‐based compensation requirements of Code Section 162(m), with respect to any Award granted subject to Performance Goals, within the first twenty‐five percent (25%) of the Performance Period, but in no event more than ninety (90) days following the commencement of any Performance Period (or such other time as may be required or permitted by Code Section 162(m)), the Compensation Committee will, in writing, (a) designate one or more Participants who are Covered Employees, (b) select the Performance Goals applicable to the Performance Period, (c) establish the Performance Goals, and amounts or methods of computation of such Awards, as applicable, which may be earned for such Performance Period, and (d) specify the relationship between Performance Goals and the amounts or methods of computation of such Awards, as applicable, to be earned by each Covered Employee for such Performance Period. Following the completion of each Performance Period, the Compensation Committee will certify in writing whether the applicable Performance Goals have been achieved for such Performance Period. In determining the amounts earned by a Covered Employee, the Compensation Committee will have the right to reduce or eliminate (but not to increase) the amount payable at a given level of performance to take into account additional factors that the Compensation Committee may deem relevant to the assessment of individual or corporate performance for the Performance Period.
(d)  Payment of Performance Based Awards.  Unless otherwise provided in the applicable Award Agreement, a Covered Employee must be employed by the Company or an Affiliate on the day a Performance‐Based Award for such 

Performance Period is paid to the Covered Employee. Furthermore, a Covered Employee will be eligible to receive payment pursuant to a Performance‐Based Award for a Performance Period only if the Performance Goals for such period are achieved.
(e)  Additional Limitations.  Notwithstanding any other provision of the Plan, any Award which is granted to a Covered Employee and is intended to constitute qualified performance based compensation under Code Section 162(m) will be subject to any additional limitations set forth in the Code (including any amendment to Code Section 162(m)) or any regulations and ruling issued thereunder that are requirements for qualification as qualified performance‐ based compensation as described in Code Section 162(m), and the Plan will be deemed amended to the extent necessary to conform to such requirements.
14.    Outside Director Limitations.  No Outside Director may be granted, in any Fiscal Year, Awards with a grant date fair value (determined in accordance with U.S. generally accepted accounting principles) of greater than $900,000.  Any Awards granted to an individual while he or she was an Employee, or while he or she was a Consultant but not an Outside Director, will not count for purposes of the limitations under this Section 14.
15.    Compliance With Code Section 409A.  Awards will be designed and operated in such a manner that they are either exempt from the application of, or comply with, the requirements of Code Section 409A such that the grant, payment, settlement or deferral will not be subject to the additional tax or interest applicable under Code Section 409A, except as otherwise determined in the sole discretion of the Administrator. The Plan and each Award Agreement under the Plan is intended to meet the requirements of Code Section 409A and will be construed and interpreted in accordance with such intent, except as otherwise determined in the sole discretion of the Administrator. To the extent that an Award or payment, or the settlement or deferral thereof, is subject to Code Section 409A the Award will be granted, paid, settled or deferred in a manner that will meet the requirements of Code Section 409A, such that the grant, payment, settlement or deferral will not be subject to the additional tax or interest applicable under Code Section 409A.
16.    Leaves of Absence/Transfer Between Locations.  Unless the Administrator provides otherwise or as provided by written Company policies, vesting of Awards granted hereunder will be suspended during any unpaid leave of absence or as provided by written Company policies. A Service Provider will not cease to be an Employee in the case of (i) any leave of absence approved by the Company or (ii) transfers between locations of the Company or between the Company and its Affiliates. For purposes of Incentive Stock Options, no such leave may exceed three (3) months, unless reemployment upon expiration of such leave is guaranteed by statute or contract. If reemployment upon expiration of a leave of absence approved by the Company is not so guaranteed, then six (6) months and one day following the commencement of such leave any Incentive Stock Option held by the Participant will cease to be treated as an Incentive Stock Option and will be treated for tax purposes as a Nonstatutory Stock Option.
17.    Transferability of Awards.  Unless determined otherwise by the Administrator, an Award may not be sold, pledged, assigned, hypothecated, transferred, or disposed of in any manner other than by will or by the laws of descent or distribution and may be exercised, during the lifetime of the Participant, only by the Participant. With the approval of the Administrator, a Participant may, in a manner specified by the Administrator, (a) transfer an Award to a Participant’s spouse or former spouse pursuant to a court‐approved domestic relations order which relates to the provision of child support, alimony payments or marital property rights, and (b) transfer an Option by bona fide gift and not for any consideration, to (i) a member or members of the Participant’s immediate family, (ii) a trust established for the exclusive benefit of the Participant and/or member(s) of the Participant’s immediate family, (iii) a partnership, limited liability company of other entity whose only partners or members are the Participant and/or member(s) of the Participant’s immediate family, or (iv) a foundation in which the Participant and/or member(s) of the Participant’s immediate family control the management of the foundation’s assets. For purposes of this Section 17, “immediate family” will mean the Participant’s spouse, former spouse, children, grandchildren, parents, grandparents, siblings, nieces, nephews, parents‐in‐law, sons‐in‐law, daughters‐in‐law, brothers‐in‐law, sisters‐in‐law, including adoptive or step relationships and any person sharing the Participant’s household (other than as a tenant or employee).
		
	18.
	Adjustments; Dissolution or Liquidation; Merger or Change in Control.

(a)  Adjustments.  In the event that any dividend or other distribution (whether in the form of cash, Shares, other securities, or other property), recapitalization, stock split, reverse stock split, reorganization, merger, consolidation, split‐up, spin‐off, combination, repurchase, or exchange of Shares or other securities of the Company, or other change in the corporate structure of the Company affecting the Shares occurs, the Administrator, in order to prevent diminution or enlargement of the benefits or potential benefits intended to be made available under the Plan, will adjust the number and class of Shares that may be delivered under the Plan and/or the number, class, and price of Shares covered by each outstanding Award, and the numerical Share or value limits, as applicable, set forth in Sections 3, 6, 7, 8, 9, 10 and 14.

(b)  Dissolution or Liquidation.  In the event of the proposed dissolution or liquidation of the Company, the Administrator will notify each Participant as soon as practicable prior to the effective date of such proposed transaction. To the extent it has not been previously exercised, an Award will terminate immediately prior to the consummation of such proposed action.
(c)  Change in Control.  In the event of a Change in Control, each outstanding Award will be assumed or an equivalent option or right substituted by the successor corporation or a Parent or Subsidiary of the successor corporation (the “Successor Corporation”). In the event that the Successor Corporation does not assume or substitute for the Award, the Participant will fully vest in and have the right to exercise all of his or her outstanding Options and Stock Appreciation Rights, including Shares as to which such Awards would not otherwise be vested or exercisable, all restrictions on Restricted Stock will lapse, and, with respect to Restricted Stock Units, Performance Shares and Performance Units, all Performance Goals or other vesting criteria will be deemed achieved at target levels and all other terms and conditions met. In addition, if the Successor Corporation does not assume or substitute an Option or Stock Appreciation Right in the event of a Change in Control, the Administrator will notify the Participant in writing or electronically that the Option or Stock Appreciation Right will be fully vested and exercisable for a period of time determined by the Administrator in its sole discretion, and the Option or Stock Appreciation Right will terminate upon the expiration of such period.
For the purposes of this subsection (c), an Award will be considered assumed if, following the Change in Control, the Award confers the right to purchase or receive, for each Share subject to the Award immediately prior to the Change in Control, the consideration (whether stock, cash, or other securities or property) or, in the case of a Stock Appreciation Right upon the exercise of which the Administrator determines to pay cash or a Performance Share or Performance Unit which the Administrator can determine to pay in cash, the fair market value of the consideration received in the merger or Change in Control by holders of Common Stock for each Share held on the effective date of the transaction (and if holders were offered a choice of consideration, the type of consideration chosen by the holders of a majority of the outstanding Shares); provided, however, that if such consideration received in the Change in Control is not solely common stock of the Successor Corporation, the Administrator may, with the consent of the Successor Corporation, provide for the consideration to be received upon the exercise of an Option or Stock Appreciation Right or upon the payout of a Restricted Stock Unit, Performance Share or Performance Unit, for each Share subject to such Award (or in the case of an Award settled in cash, the number of implied shares determined by dividing the value of the Award by the per share consideration received by holders of Common Stock in the Change in Control), to be solely common stock of the Successor Corporation equal in fair market value to the per share consideration received by holders of Common Stock in the Change in Control.
Notwithstanding anything in this Section 18(c) to the contrary, an Award that vests, is earned or paid‐out upon the satisfaction of one or more Performance Goals will not be considered assumed if the Company or its successor modifies any of such Performance Goals without the Participant’s consent; provided, however, a modification to such Performance Goals only to reflect the Successor Corporation’s post‐Change in Control corporate structure will not be deemed to invalidate an otherwise valid Award assumption.
		
	19.
	Tax Withholding

(a)  Withholding Requirements.  Prior to the delivery of any Shares or cash pursuant to an Award (or exercise thereof), the Company will have the power and the right to deduct or withhold, or require a Participant to remit to the Company, an amount sufficient to satisfy federal, state, local, foreign or other taxes required to be withheld with respect to such Award (or exercise thereof).
(b)  Withholding Arrangements.  The Administrator, in its sole discretion and pursuant to such procedures as it may specify from time to time, may permit a Participant to satisfy such tax withholding obligation, in whole or in part by (without limitation) (i) paying cash, (ii) electing to have the Company withhold otherwise deliverable cash or Shares having a Fair Market Value equal to the minimum amount required to be withheld, (iii) delivering to the Company already‐owned Shares having a Fair Market Value equal to the amount required to be withheld, or (iv) selling a sufficient number of Shares otherwise deliverable to the Participant through such means as the Administrator may determine in its sole discretion (whether through a broker or otherwise) equal to the amount required to be withheld. The amount of the withholding requirement will be deemed to include any amount which the Administrator agrees may be withheld at the time the election is made, not to exceed the amount determined by using the maximum federal, state or local marginal income tax rates applicable to the Participant with respect to the Award on the date that the amount of tax to be withheld is to be determined. The Fair Market Value of the Shares to be withheld or delivered will be determined as of the date that the taxes are required to be withheld.
20.    No Effect on Employment or Service.  Neither the Plan nor any Award will confer upon a Participant any right with respect to continuing the Participant’s relationship as a Service Provider with the Company, nor will they interfere in any way 

with the Participant’s right or the Company’s right to terminate such relationship at any time, with or without cause, to the extent permitted by Applicable Laws.
21.    Date of Grant.  The date of grant of an Award will be, for all purposes, the date on which the Administrator makes the determination granting such Award, or such other later date as is determined by the Administrator. Notice of the determination will be provided to each Participant within a reasonable time after the date of such grant.
22.    Term of Plan.  The Plan will become effective upon its approval by the stockholders and no Awards may be made under the Plan until such approval is obtained. The Plan shall continue in effect for a term of ten (10) years after the date it becomes effective, unless terminated earlier under Section 2223 of the Plan.
		
	23.
	Amendment and Termination of the Plan.

(a)  Amendment and Termination.  The Administrator may at any time amend, alter, suspend or terminate the Plan.
(b)  Stockholder Approval.  The Company will obtain stockholder approval of any Plan amendment to the extent necessary and desirable to comply with Applicable Laws.
(c)  Effect of Amendment or Termination.  No amendment, alteration, suspension or termination of the Plan will impair the rights of any Participant, unless mutually agreed otherwise between the Participant and the Administrator, which agreement must be in writing and signed by the Participant and the Company. Termination of the Plan will not affect the Administrator’s ability to exercise the powers granted to it hereunder with respect to Awards granted under the Plan prior to the date of such termination.
		
	24.
	Conditions Upon Issuance of Shares.

(a)  Legal Compliance.  Shares will not be issued pursuant to the exercise of an Award unless the exercise of such Award and the issuance and delivery of such Shares will comply with Applicable Laws and will be further subject to the approval of counsel for the Company with respect to such compliance.
(b)  Investment Representations.  As a condition to the exercise of an Award, the Company may require the person exercising such Award to represent and warrant at the time of any such exercise that the Shares are being purchased only for investment and without any present intention to sell or distribute such Shares if, in the opinion of counsel for the Company, such a representation is required.
25.      Inability to Obtain Authority.  The inability of the Company to obtain authority from any regulatory body having jurisdiction, which authority is deemed by the Company’s counsel to be necessary to the lawful issuance and sale of any Shares hereunder, will relieve the Company of any liability in respect of the failure to issue or sell such Shares as to which such requisite authority will not have been obtained.
		
	26.
	Stockholder Approval.

(a)  General.  The Plan will be subject to approval by the stockholders of the Company within twelve (12) months after the date the Plan is adopted. Such stockholder approval will be obtained in the manner and to the degree required under Applicable Laws.
(b)  Section 162(m).  Subject to Section 23 (regarding the Administrator’s right to amend or terminate the Plan), the provisions of Section 13 relating to Awards intended to qualify as “performance based compensation” under Code Section 162(m) shall remain in effect thereafter through the Company’s 2018 Annual Meeting.EX-4.32

 Exhibit 4.32 

 
 WPP PLC 

 
  

 
 SHARE OPTION PLAN 2015 

 
  

 
 Adopted by the board of directors of the Company on
14 April 2015 
 and approved by share owners in general meeting on 9 June 2015 

 
 SQUIRE PATTON BOGGS (UK) LLP 

7 Devonshire Square 
 London 
 EC2M 4YH 

United Kingdom 
 DX 136546 Bishopsgate 2 
  
 O +44 20 7655 1000 
 F +44 20 7655 1001 

 
 Reference WPP.002-1586 

 CONTENTS 

 

					
	 GLOSSARY
	  	 	3	 
		
	 1      HOW THE PLAN WORKS AND HOW OPTIONS ARE GRANTED
	  	 	5	 
		
	 2      RIGHTS OF A PARTICIPANT AFTER GRANT BUT BEFORE EXERCISE
	  	 	7	 
		
	 3      EXERCISE OF OPTIONS
	  	 	7	 
		
	 4      LEAVING EMPLOYMENT
	  	 	9	 
		
	 5      REDUCTION OF AN OPTION
	  	 	10	 
		
	 6      TRANSACTIONS AFFECTING THE COMPANY
	  	 	10	 
		
	 7      CHANGING THE PLAN
	  	 	12	 
		
	 8      GENERAL
	  	 	12	 

 Glossary 

 
 “Acquiring Company” means the person or
persons who obtain Control or the person who acquires Shares as a result of a transaction mentioned in rule 6.1. 
  

“ADSs” means depositary instruments representing a beneficial holding in fully paid ordinary shares in the capital of the
Company. 
  
 “Basic Salary” means
the person’s gross salary and fees. Where it is necessary to convert the currency of a person’s basic salary for the purposes of rule 1.7, it will be converted at the Company’s budget rate applicable at the relevant date unless the
Compensation Committee determines otherwise. 
  

“Business” means a functional business unit of the Company operating in any of the following ways: 

 

	 	(a)	 	within a Subsidiary; 

  

	 	(b)	 	across one or more Members of the Group; or 

  

	 	(c)	 	as a sector, operating brand or operating company (as referred to in the Company’s report and accounts). 

 
 “Business Day” means a day on which both
the London Stock Exchange and NASDAQ are open for the transaction of business. 
  
 “Cash Value” means the value of a Share as determined by the Compensation Committee based on the price at which Shares are sold on or around the date of exercise of Options (and in the
case of sales of Shares on more than one Business Day, the average of those prices). 
  
 “Company” means WPP plc, a public limited company incorporated in Jersey with registered number 111714. 

 
 “Compensation Committee” means a duly
authorised committee appointed by the board of directors of the Company or, where any discretion has to be exercised under rule 6, the people who comprised the Compensation Committee immediately before the transaction by virtue of which that rule
applies. 
  
 “Control” means the
power of a person, or persons acting in concert, to secure, by means of holding voting rights in relation to the Company’s share capital or powers conferred by any document regulating the Company, that the affairs of the Company are exercised
in accordance with its or their wishes. 
  

“Dealing Restrictions” means restrictions imposed by statute, order, regulation or Government directive, or by the Model
Code or any code adopted by the Company based on the Model Code. 
  
 “Eligible Employee” means: 
  

	 	(a)	 	in respect of an Executive Option, an executive director or an employee of a Member of the Group; and 

 

	 	(b)	 	in respect of any other Option, an employee whose working time for one or more Members of the Group equals or exceeds a period determined by the Compensation Committee
at the relevant Grant Date. 

  

“Exercise Date” means the first Business Day on or after: 
  

	 	(a)	 	the third anniversary of the Grant Date, or any other date after the Grant Date that the Compensation Committee decides on the grant of an Option should be the exercise
date; 

  

	 	(b)	 	cessation of the Participant’s employment if either of rules 4.3 or 4.4 applies; or 

  

	 	(c)	 	the date that a transaction as described in rule 6 occurs; 

  

whichever occurs first. 
  

“Executive Option” means an Option granted to an individual on bespoke terms. 

  
 3 

 “Grant Date” means the date specified in the deed or other document
produced in accordance with rule 1.13. 
  

“Listing Rules” means the rules relating to admission to the Official List. 

 
 “London Stock Exchange” means London Stock
Exchange plc or its successor. 
  
 “Market
Value” means the value determined by the Compensation Committee that must be at least equal to: 
  

	 	(a)	 	in the case of Shares of the same class as shares listed in the Official List, the closing mid-market price, which is half way between the closing bid and offer prices
shown in the quotations for those shares in the Official List on the Business Day immediately preceding the Grant Date; or 

  

	 	(b)	 	in the case of ADSs, the closing price of an ADS on NASDAQ on the Business Day immediately preceding the Grant Date; 

 
 and in the case of an Option that is intended to qualify for
any favourable tax treatment, as determined in accordance with any other formula that will enable the Option to qualify for that favourable tax treatment. 
  

“Member of the Group” means: 
  

	 	(a)	 	the Company; or 

  

	 	(b)	 	any Subsidiary from time to time; or 

  

	 	(c)	 	any other company that is designated by the Compensation Committee as associated with the Company for some or all purposes of the Plan. 

 
 “Model Code” means the Model Code on
dealings in securities set out in Listing Rule 9 Annex 1 of the Listing Rules of the United Kingdom Listing Authority issued by the Financial Conduct Authority, which govern companies whose shares are traded on the London Stock Exchange. 

 
 “NASDAQ” means the US screen-based system
for the quotation and transfer of equity securities. 
  
 “Official List” means the daily list maintained by the Financial Conduct Authority for the purposes of section 74(1) of the Financial Services and Markets Act 2000 setting out the quoted
prices of shares traded on the London Stock Exchange. 
  
 “Option” means a right to acquire Shares under the Plan. 
  

“Participant” means a person holding an Option or in the event of death, the Participant’s personal representatives.

  
 “Performance Condition” means
any performance condition imposed under rule 1.10. 
  

“Performance Remuneration” means any remuneration of the Participant where the amount was calculated by reference to the
performance of the Participant, a Member of the Group as a whole or any business within a Member of the Group. 
  

“Plan” means these rules known as the WPP Share Option Plan 2015 as changed from time to time. 

 
 “Regulatory Information Service” means a
service that is approved by the Financial Conduct Authority as meeting the Primary Information Provider criteria and is on the list of Regulatory Information Services maintained by the Financial Conduct Authority. 

 
 “Shares” means fully paid ordinary shares
(including treasury shares) in the capital of the Company or ADSs. 
  
 “Subsidiary” means a company that is a subsidiary of the Company within the meaning of Articles 2 and 2A of the Companies (Jersey) Law 1991. 

  
 4 

 “Trustee” means the trustee or trustees of any employee benefit trust
established by the Company or any Member of the Group. 
  

	1	HOW THE PLAN WORKS AND HOW OPTIONS ARE GRANTED 

  

	1.1	 	How the Plan works 

  

The Plan gives a Participant the right to buy Shares at an exercise price set in accordance with rule 1.5 below, subject to the
satisfaction of certain conditions and continued employment. 
  

	1.2	 	Granting Options 

  

Options will be granted by the Company but the Compensation Committee will decide who gets an Option, over how many Shares and on what
terms. 
  

	1.3	 	Participation 

  

The Company can grant an Option to any Eligible Employee selected by the Compensation Committee. However, unless the Compensation
Committee considers that special circumstances exist, an Option may not be granted to an employee who, on the Grant Date, has given or received notice of termination of employment, whether or not that termination is lawful. 

 

	1.4	 	Timing of Option grants 

  

Options can only be granted within 42 days of the following: 

 

	 	(a)	 	the date on which the Plan is approved by the share owners of the Company; 

 

	 	(b)	 	the Business Day after the announcement of the Company’s results through a Regulatory Information Service for any period; 

 

	 	(c)	 	the Business Day after the Company’s annual general meeting; 

 

	 	(d)	 	any day on which the Company decides that exceptional circumstances exist that justify the grant of Options; 

 

	 	(e)	 	any day on which changes to the legislation or regulations affecting the Plan are announced, effected or made; or 

 

	 	(f)	 	the lifting of Dealing Restrictions that prevented the granting of Options during any period specified above. 

 

	1.5	Exercise price 

  

The exercise price per Share must be set by the Compensation Committee when the Option is granted and must be at least Market Value.

  

	1.6	 	Expiry of the Plan 

  

Options can only be granted within the period of 10 years from the date of approval of the Plan by the share owners of the Company.

  
 5 

	1.7	 	Personal limit 

  

The Market Value (established at the date that the Compensation Committee makes its decisions under this rule 1) of all the Shares subject
to Options granted to a Participant in the preceding twelve months cannot be more than: 
  

	 	(a)	 	one times; or 

  

	 	(b)	 	in the case of an Executive Option, four times; that Participant’s Basic Salary. 

 

	1.8	 	Other limits 

  

There are also limits on the number of Shares that can be issued under the Plan – see rule 8.1. 

 

	1.9	 	Effect of the limits in rules 1.7 and 1.8 

  

If the Company purports to grant an Option that is inconsistent with either of rules 1.7 or 1.8, the Option will be limited on a basis
consistent with those rules with effect from the Grant Date. 
  

	1.10	 	Performance condition 

  

The exercise of an Option may be made conditional on the satisfaction of one or more conditions linked to the performance of the Company,
the Participant or the Business or Member of the Group for which the Participant works. A Performance Condition must be objective and may provide that an Option will lapse to the extent it is not satisfied. The Compensation Committee may impose
other conditions when granting an Option. 
  

	1.11	 	Options granted to directors of the Company 

  

The exercise of an Option granted to a director of the Company must be conditional on the satisfaction of one or more performance
conditions to be prescribed after consultation with key share owners of the Company. 
  

	1.12	 	Option certificates 

  

As soon as practicable after granting an Option, the Company will provide evidence to the Participant of the grant. 

 

	1.13	 	Grant requirements 

  

Options must be granted by deed or other legally-binding document. The terms of the Option, as determined by the Compensation Committee,
must be specified in the deed or other document and must include: 
  

	 	(a)	 	the number of Shares subject to the Option; 

  

	 	(b)	 	the exercise price; 

  

	 	(c)	 	the Grant Date; 

  

	 	(d)	 	the Performance Condition (if any); and 

  

	 	(e)	 	the Exercise Date. 

  

	1.14	 	Right to decline 

  

Participants will be notified of the grant of Options. An Option may be declined by a Participant within 30 days after the Grant Date
by notice in writing to any person nominated by the Compensation Committee. 

  
 6 

 
If this happens, the Option will be treated as if it had never been granted under the Plan. A Participant is not required to make any payment to decline an Option. 

 

	2	 	RIGHTS OF A PARTICIPANT AFTER GRANT BUT BEFORE EXERCISE 

  

	2.1	 	Effect of transferring an Option 

  

If a Participant, whether voluntarily or involuntarily, transfers, assigns, charges or otherwise disposes of an Option or any rights in
respect of it, the Option will immediately lapse unless the Compensation Committee decides to the contrary. 
  

	2.2	 	Right to transfer on death 

  

Rights under an Option are transferred to the personal representatives of a Participant after the Participant’s death as set out rule
4.4. 
  

	2.3	 	No share rights before exercise of Options 

  

A Participant cannot vote and is not entitled to receive dividends in respect of the Shares subject to an Option until after exercise, as
described in rule 3.7. 
  

	3	 	EXERCISE OF OPTIONS 

  

	3.1	 	When can an Option be exercised? 

  

An Option can be exercised on or after the Exercise Date and: 

 

	 	(a)	 	before the tenth anniversary of the Grant Date, or any earlier date determined by the Compensation Committee at the time the Option is granted;

  

	 	(b)	 	during the period of six months after the Participant ceases to be an employee in one of the circumstances set out in rule 4.3; 

 

	 	(c)	 	during the period of twelve months after the date of death of the Participant as set out in rule 4.4; or 

 

	 	(d)	 	during the period of one month after a transaction affecting the Company as set out in rule 6.1. 

  
 The Compensation Committee may specify that an Option can only be exercised at particular times within the
relevant period. Any Option not exercised by the end of the relevant period will lapse. 
  

	3.2	 	Method of exercise 

  

Exercise of an Option is conditional on the Participant paying to the Company: 
  

	 	(a)	 	the exercise price; and 

  

	 	(b)	 	any tax arising on exercise (see rules 3.9 and 3.10), 

  

or other arrangements being agreed between the Participant and the Company for the payment of these amounts. 

 

	3.3	 	Satisfaction of any Performance Conditions 

  

If the Option is subject to a Performance Condition, as soon as reasonably practicable after the Exercise Date, the Compensation Committee
will determine the extent to which the Performance Condition has been satisfied. 
  

	3.4	 	Exercisable proportion of an Option and lapse 

  

	 	(a)	 	 If the Option is subject to a Performance Condition and granted to a director of the Company, it will be exercisable to the extent the Performance
Condition is satisfied and the balance of the Option will 

  
 7 

	 	 
lapse. The Compensation Committee may decide otherwise in respect of an Option granted to a Participant who is not a director of the Company. 

 

	 	(b)	 	For all Options, the number of Shares that can be acquired on exercise earlier than the third anniversary of the Grant Date will be adjusted under rule 6.2 and the
balance will lapse. 

  

	3.5	 	Effect of a Dealing Restriction 

  

An Option may not be exercised if a Dealing Restriction applies but it will become exercisable after the Exercise Date once the Dealing
Restriction ceases to apply. 
  

	3.6	 	Satisfaction of Options after exercise 

  

Subject to rule 5 and any consents under rule 8.10 being obtained, as soon as reasonably practicable after an Option has been exercised,
the Company will arrange for the transfer or issue to, or to the order of, the Participant of the number of Shares in respect of which the Option has been exercised (or the settlement of the Option in cash under rule 3.8). 

 

	3.7	 	Share rights after exercise 

  

The Participant will be entitled to all rights attaching to the Shares that are transferred or issued following exercise by reference to a
record date on or after the date of the transfer or issue. 
  

	3.8	 	Cash settlement of Options and cash awards 

  

Subject to rules 3.9 and 3.10, the Company may decide: 

 

	 	(a)	 	after the exercise of an Option that instead of transferring or issuing Shares, to pay to, or to the order of, the Participant an amount equal to the Cash Value of the
Shares that would have been transferred or issued on exercise of the Option less the exercise price of the Shares; or 

  

	 	(b)	 	on the Grant Date that an Eligible Employee will be granted, instead of an Option (but otherwise on the same terms as an Option), a right to receive (on the Exercise
Date) an amount equal to the Cash Value of the Shares that would have been transferred or issued on exercise of an Option less the exercise price of the Shares. 

 

	3.9	 	Responsibility for tax 

  

The Participant must pay all tax, social security contributions and other levies in respect of the exercise of an Option. If the
Participant is to be responsible for the payment of any employers’ social security contributions, this must be specified in the terms of the Option. 
  

	3.10	 	Methods of paying the tax 

  

If any Member of the Group or any Trustee has to pay or account for any item referred to in rule 3.9, the Participant must pay or repay
that amount on demand. Instead, or in addition, the Member of the Group or Trustee can do any one or more of the following: 
  

	 	(a)	 	sell sufficient of the Shares subject to the Option on behalf of the Participant and retain the proceeds or pay them to any tax authority; 

 

	 	(b)	 	reduce the number of Shares subject to the Option or the number of Shares (or cash under rule 3.8) to which the Participant is entitled on exercise; and/or

  

	 	(c)	 	deduct the amount from any amount to which the Participant is entitled under the Plan, the Participant’s employment contract or otherwise.

  
 8 

	4	LEAVING EMPLOYMENT 

  

	4.1	 	Meaning of leaving employment 

  

A Participant will be treated as leaving employment only when they are no longer either an employee or a director of any Member of the
Group. They will not be treated as leaving if they recommence an employment or office with a Member of the Group within 1 calendar month or any longer period that the Compensation Committee determines for a particular Participant, as long as that
determination is made within 6 months of the date when the Participant ceased to be an employee or director. 
  

	4.2	 	Leaving within six months of the grant of an Option 

  

If a Participant leaves employment within the first six months after the Grant Date, the relevant Option will lapse. 

 

	4.3	 	Good leavers 

  

If the Participant leaves employment for one of the following reasons: 
  

	 	(a)	 	ill-health, injury or disability, established to the satisfaction of the Compensation Committee; 

  

	 	(b)	 	retirement on any basis acceptable to the Compensation Committee; 

 

	 	(c)	 	the Participant’s employing company ceasing to be a Subsidiary; 

 

	 	(d)	 	a transfer of the Business, or the part of the Business, in which the Participant works to a person that is not a Member of the Group; and 

 

	 	(e)	 	any other reason if the Compensation Committee so decides generally or in any particular case within 20 Business Days of the Participant leaving;

  
 unless the Compensation Committee
decides otherwise, the Option will not lapse but will become exercisable but only to the extent that any applicable Performance Condition has been satisfied. The Compensation Committee will reduce the number of Shares in respect of which an
Executive Option may be exercised to reflect the period from the Grant Date to the date of leaving (calculated using the number of complete calendar months since the Grant Date) as a proportion of the period between the Grant Date and the Exercise
Date. In exceptional circumstances, the Compensation Committee may determine that an Option will be exercisable on a different basis. 
  

	4.4	 	Death of a Participant 

  

Unless the Compensation Committee decides otherwise, the Option of a deceased Participant will be exercisable by the Participant’s
personal representatives but only to the extent that any applicable Performance Condition has been satisfied (as determined by the Compensation Committee) up to the date of death. Shares will be issued or transferred (or cash paid under rule 3.8) to
the Participant’s personal representatives. The Compensation Committee may: 
  

	 	(a)	 	reduce the number of Shares in respect of which an Executive Option may be exercised to reflect the number of complete calendar months between the Grant Date and the
date of death as a proportion of the period between the Grant Date and the Exercise Date; and 

  

	 	(b)	 	in exceptional circumstances, determine that an Option may be exercised on any other terms that it considers appropriate. 

 

	4.5	 	Other leavers 

  

Other than in a case where the Participant is a good leaver (see rule 4.3) or dies (see rule 4.4), if a Participant leaves employment
before the Exercise Date of an Option, that Option will lapse. 

  
 9 

	4.6	 	Interaction of leaving employment and Company transactions 

 
 If a Participant leaves employment or dies and the relevant
Option has not been exercised under this rule 4 and the Option is or becomes exercisable under rule 6, the Option will lapse on the earlier of the end of the period allowed for exercise under this rule 4 and the end of the period allowed for
exercise under rule 6. 
  

	5	 	REDUCTION OF AN OPTION 

  

	5.1	 	Overpayment of Performance Remuneration 

  

If a Participant: 
  

	 	(a)	 	commits an act of fraud, dishonesty or deceit that affected an amount of Performance Remuneration paid to the Participant; 

 

	 	(b)	 	does or omits to do something that results in a set of audited accounts being materially wrong or misleading and either; 

 

	 	(i)	 	those accounts have to be materially corrected; or 

  

	 	(ii)	 	a subsequent set of accounts or data have to be adjusted or include a provision or write down as a result of that act or omission; or 

 

	 	(c)	 	knew or should have known that any information used to calculate any of the Participant’s Performance Remuneration was incorrect; 

 
 and the Compensation Committee determines that, as a result,
an amount of the Participant’s Performance Remuneration has been overpaid, it can decide that an Executive Option or part of an Executive Option will lapse to compensate the Company for that overpayment, provided that the Compensation Committee
will act reasonably in exercising this power. 
  

	5.2	 	Reduction in working hours 

  

If a Participant’s working hours are materially reduced before the Exercise Date of an Option, the Compensation Committee may reduce
the number of Shares in respect of which that Option may be exercised, as it considers appropriate. 
  

	6	 	TRANSACTIONS AFFECTING THE COMPANY 

  

	6.1	 	Early exercise 

  

Subject to rules 6.2 to 6.4, Options will become exercisable under this rule 6 if: 

 

	 	(a)	 	a person (or a group of persons acting in concert) obtains Control of the Company as a result of making an offer to acquire Shares; 

 

	 	(b)	 	a person becomes bound or entitled to acquire Shares under Part 18 of the Companies (Jersey) Law 1991 (“squeeze-out”); 

 

	 	(c)	 	the court sanctions a scheme of arrangement under Part 18A of the Companies (Jersey) Law 1991 involving the acquisition of Shares; or 

 

	 	(d)	 	the Company passes a resolution for its voluntary winding up or an order is made for its compulsory winding up or it is declared en desastre. 

 

	6.2	 	Pro-rating on early exercise 

  

Where an Option becomes exercisable under rule 6.1: 

 

	 	(a)	 	if it is an Executive Option, the number of Shares in respect of which it may be exercised will be reduced to reflect the number of complete calendar months between the
Grant Date and the date of the relevant event as a proportion of the period between the Grant Date and the Exercise Date; and 

  
 10 

	 	(b)	 	it will only become exercisable if and to the extent that any applicable Performance Condition has been satisfied as at the Exercise Date. 

 

	6.3	 	Applying the Performance Condition on early exercise 

  

The extent to which the Performance Condition is satisfied will be calculated as required by its terms or, if those terms do not specify
the outcome in sufficient detail, in the manner that the Compensation Committee considers reasonable. 
  

	6.4	 	Exchanging Options rather than early exercise 

  

An Option will not become exercisable under rule 6.1 to the extent that: 
  

	 	(a)	 	an offer to exchange the Option is made by the Acquiring Company and accepted by the Participant; or 

 

	 	(b)	 	the Compensation Committee, with the consent of the Acquiring Company, decides before the person obtains Control or the court sanctions the scheme of arrangement that
the Option will be automatically exchanged. 

  

	6.5	 	Terms of exchanged Options 

  

Where an Option is to be exchanged under rule 6.4, the exchange will take place as soon as practicable after the relevant event and the
Participant will be granted a new option in exchange for the existing Option. The new option: 
  

	 	(a)	 	must confer a right to acquire shares in the Acquiring Company or another body corporate determined by the Acquiring Company; 

 

	 	(b)	 	must be equivalent in value to the existing Option; 

  

	 	(c)	 	will be treated as having been granted on the same Grant Date and will become exercisable in the same manner and at the same time as the Option it replaces;

  

	 	(d)	 	may, at the discretion of the Compensation Committee, be subject to a Performance Condition that will be, so far as possible, equivalent to any Performance Condition
applying to the Option it replaces; and 

  

	 	(e)	 	will be governed by the Plan as if references to Shares were references to the shares over which the new Option is granted and references to the Company were references
to the Acquiring Company or the body corporate determined under this rule. 

  

	6.6	 	Demergers 

  

If the Company is affected by a demerger (in whatever form) or a special dividend or distribution, the Compensation Committee may:

  

	 	(a)	 	decide that Options will become exercisable, in which case rules 6.2 and 6.3 will apply as if the Options had become exercisable under rule 6.1; or

  

	 	(b)	 	adjust the number, class or identity of Shares comprised in all existing Options. 

 

	6.7	 	Variations of capital 

  

If the Company carries out: 
  

	 	(a)	 	a rights issue; or 

  

	 	(b)	 	a variation in the equity share capital of the Company, including a capitalisation or sub-division, consolidation or reduction of share capital;

  
 11 

 the Compensation Committee may adjust the number, class or identity of Shares comprised in
an Option and/or the exercise price accordingly. 
  

	7	 	CHANGING THE PLAN 

  

	7.1	 	Compensation Committee’s right to change the Plan or Options 

 
 Except as described in the rest of this rule, the
Compensation Committee may at any time: 
  

	 	(a)	 	change the Plan or the terms of any Option (but not the Performance Condition applicable to an Option) in any way; or 

 

	 	(b)	 	amend the Performance Condition that applies to an Option if it considers that, as a result of an event or a change in circumstances, the amendment would ensure a
fairer measure of performance while being materially no more or less difficult to satisfy than the original Performance Condition. 

  

	7.2	 	Limitations on the right to make changes 

  

The Company must approve by ordinary resolution in general meeting any proposed change to the Plan or any Option to the advantage of
present or future Participants that relates to the following: 
  

	 	(a)	 	the persons to or for whom Shares may be provided under the Plan; 

 

	 	(b)	 	the limits on the number of Shares that may be issued under the Plan; 

 

	 	(c)	 	the individual limit for each Participant under the Plan; 

  

	 	(d)	 	the basis for determining a Participant’s entitlement to, and the terms of, Shares provided under the Plan; 

 

	 	(e)	 	the rights of a Participant in the event of a capitalisation issue, rights issue or open offer, sub-division or consolidation of shares or reduction of capital or any
other variation of capital of the Company; or 

  

	 	(f)	 	the terms of this rule 7.2. 

  

	7.3	 	Compensation Committee’s right to make minor changes 

  

The Compensation Committee can make minor changes to the Plan or any Option without the approval of the Company in general meeting to:

  

	 	(a)	 	benefit the administration of the Plan; 

  

	 	(b)	 	comply with or take account of the provisions of any proposed or existing legislation; 

  

	 	(c)	 	take account of any changes to legislation; or 

  

	 	(d)	 	obtain or maintain favourable tax, exchange control or regulatory treatment of any Member of the Group or any present or future Participant. 

 

	8	 	GENERAL 

  

	8.1	 	Company limits 

  

The Company must not grant an Option if the number of Shares committed to be issued under that Option exceeds: 

 

	 	(a)	 	10 per cent of the ordinary share capital of the Company in issue immediately before that day, when added to the number of Shares which have been issued or
committed to be issued to satisfy Options, or options or awards under any other employee share plan operated by the Company, granted in the previous 10 years; or 

  
 12 

	 	(b)	 	5 per cent of the ordinary share capital of the Company in issue immediately before that day, when added to the number of Shares that have been issued or committed
to be issued to satisfy Options, or options or awards under any other discretionary employee share plan adopted by the Company, granted in the previous 10 years. 

 
 Shares that have been or may be transferred out of treasury
to satisfy Options or options or awards under any other employee share plan adopted by the Company will be treated as Shares issued or committed to be issued for the purposes of this rule 8.1 but these limits do not include Shares subject to Options
or options or awards that have lapsed or been surrendered. 
  

	8.2	 	Serving notice on a Participant 

  

Any notice or other document which has to be given to a person who is or, is eligible to be, a Participant under or in connection with the
Plan may be: 
  

	 	(a)	 	delivered or sent by post to the Participant’s home address according to the records of the employing company; or 

 

	 	(b)	 	sent by e-mail to any e-mail address that according to the records of the employing company is used by the Participant; 

 
 or, in either case, any other address that the Compensation
Committee considers appropriate or communicated by any other electronic means that the Compensation Committee approves. 
  

	8.3	 	Serving notice on the Company 

  

Any notice or other document that has to be given to the Company or other duly appointed agent under or in connection with the Plan may be
delivered or sent by post to the registered office of the Company (or any other place that the Compensation Committee or duly appointed agent may from time to time decide and notify to Participants) or sent by e-mail to any e-mail address or by
other electronic means notified to the Participant. 
  

	8.4	 	Timing of delivery of notices 

  

Notices sent by post will be deemed to have been given on the second day after the date of posting. However, notices sent by or to a
Participant who is working overseas will be deemed to have been given on the seventh day after the date of posting. Notices sent by e-mail, in the absence of evidence to the contrary, will be deemed to have been received on the day after sending.

  

	8.5	 	The effect of Compensation Committee decisions 

  

The decision of the Compensation Committee on the interpretation of the Plan or in any dispute relating to an Option or matter relating to
the Plan will be final and conclusive. 
  

	8.6	 	The costs of the Plan 

  

The Company will pay the costs of introducing and administering the Plan. The Company may require a Participant’s employer to bear
the costs in respect of an Option granted to that Participant. 
  

	8.7	 	Administering the Plan 

  

The Compensation Committee has the power, from time to time, to make or vary regulations for the administration and operation of the Plan.

  
 13 

	8.8	 	Relationship between the Plan and employment 

  

This rule governs the relationship between the Plan and a Participant’s employment. 

 

	 	(a)	 	For the purposes of this rule, “Employee” means any employee (including an executive director) of a Member of the Group. 

 

	 	(b)	 	This rule applies during an Employee’s employment and after the termination of an Employee’s employment, whether or not the termination is lawful.

  

	 	(c)	 	The rules and the operation of the Plan do not form part of the contract of employment of an Employee. The rights and obligations arising from the employment
relationship between the Employee and any Member of the Group are separate from, and are not affected by, the Plan. Participation in the Plan does not create any right to, or expectation of, continued employment. 

 

	 	(d)	 	An Employee does not have a right to participate in the Plan. Participation in the Plan or the grant of Options on a particular basis in any year does not create any
right to or expectation of participation in the Plan or the grant of Options on the same basis, or at all, in any future year. Benefits received under the Plan are not pensionable. 

 

	 	(e)	 	The terms and operation of the Plan do not entitle Employees to the exercise of any discretion in their favour. 

 

	 	(f)	 	An Employee will not have a claim or right of action in respect of any decision, omission or exercise of discretion relating to the Plan or an Option that may operate
to the disadvantage of the Employee even if it is unreasonable (except in relation to any authority exercised under rule 5), irrational or might otherwise be regarded as being in breach of the duty of trust and confidence (and/or any other implied
duty) between the Employee and the employer. 

  

	 	(g)	 	An Employee will not have any right to compensation for any loss in relation to the Plan, including any loss in relation to: 

 

	 	(i)	 	any loss or reduction of rights or expectations under the Plan in any circumstances (including lawful or unlawful termination of employment); 

 

	 	(ii)	 	any exercise of a discretion or a decision taken in relation to an Option or to the Plan, or any failure to exercise a discretion or take a decision; or

  

	 	(iii)	 	the operation, suspension, termination or amendment of the Plan. 

  

	 	(h)	 	Participation in the Plan is permitted only on the basis that the Participant accepts all the provisions of the rules, including this rule. By participating in the
Plan, an Employee waives all rights under the Plan, other than the right to acquire Shares (or cash under rule 3.8) subject to and in accordance with the express terms of the Plan and any Performance Condition, in consideration for, and as a
condition of, the grant of an Option. 

  

	8.9	 	Personal data 

  

By participating in the Plan, the Participant consents to the holding and processing of personal data provided by the Participant to any
Member of the Group, Trustee or third party service provider, for all purposes relating to the operation of the Plan. These include, but are not limited to: 
  

	 	(a)	 	administering and maintaining Participant records; 

  

	 	(b)	 	providing information to Members of the Group, Trustees, registrars, brokers or third party administrators of the Plan; 

 

	 	(c)	 	providing information to future purchasers of the Company or the business in which the Participant works; and 

  
 14 

	 	(d)	 	transferring information about the Participant to a country or territory outside the European Economic Area that may not provide the same statutory protection for the
information as the Participant’s home country. 

  

	8.10	 	Consents 

  

All allotments, issues and transfers of Shares will be subject to any necessary consents under any relevant legislation or regulations for
the time being in force in Jersey, the United Kingdom, the United States of America or elsewhere. The Participant will be responsible for complying with any requirements they need to fulfil in order to obtain or avoid the need for that consent.

  

	8.11	 	Shares subject to the articles of association 

  

Any Shares acquired under the Plan are subject to the articles of association of the Company from time to time in force. 

 

	8.12	 	Application for listing on the London Stock Exchange 

  

If and so long as the ordinary shares of the Company are listed on the Official List and traded on the London Stock Exchange, the Company
will apply for listing of any ordinary shares issued under the Plan as soon as practicable. 
  

	8.13	 	Application for listing on NASDAQ 

  

If and so long as the ADSs of the Company are listed and traded on NASDAQ, the Company will apply for any necessary listing of any ADSs
created for the purpose of satisfying Options as soon as practicable. 
  

	8.14	 	Governing law 

  

The laws of England and Wales govern the Plan and all Options and their construction. The courts of England and Wales have exclusive
jurisdiction in respect of disputes arising under or in connection with the Plan or any Option. 

  
 15 

 APPENDIX 1 

 
 Australia 

 
 The Plan will apply to Options granted to residents in Australia with the
following modifications: 
  
 Under rule 1.2, the grant of an Option
over Shares to which this appendix applies will include a term that it cannot be exercised at a time when Shares of the same class as the Shares subject to the Option are listed in the London Stock Exchange Daily Official List unless Shares could be
sold in the market at that time for a price that is equal to at least 110% of the exercise price as determined in accordance with rule 1.5. 
  

Under rule 1.2, the grant of an Option over Shares to which this appendix applies will include a term that it cannot be exercised at a time when Shares of
the same class as the Shares subject to the Option are not listed in the London Stock Exchange Daily Official List unless at the time of exercise the market value (within the meaning of Part VIII of the Taxation of Chargeable Gains Act 1992) of a
Share at that time is equal to at least 110% of the exercise price determined in accordance with rule 1.5. 
  
 Under rule 1.2, the grant of an Option over ADSs to which this appendix applies will include a term that it cannot be exercised at a time when WPP ADSs are quoted on the NASDAQ National Market System
unless the price for which WPP ADSs could be sold in the market at that time is equal to at least 110% of the exercise price determined in accordance with Rule 1.5. 

 
 In Rule 3.1, delete clause (a) in its
entirety and replace with: 
  

“(a)    after the date immediately preceding the seventh anniversary of the Grant Date;”

  
 APPENDIX 2 

 
 Belgium 

 
 The Plan will apply to Options granted to residents of Belgium with the
following modifications: 
  
 In Rule 1.14, delete the words “30
days after the Grant Date” and substitute the words “60 days of the date of the Company’s notification of the grant of that Option.” 
  

A new rule 1.15 will apply, worded as follows: “An Option will lapse if a Participant fails to accept the grant of an Option within 60 days of the
date of the Company’s notification of the grant of that Option.” 
  
 APPENDIX 3 
  
 People’s Republic of China (“PRC”) 
  
 The Plan will apply to Options granted to the holders of PRC identity cards in the PRC with the following modification: 

 
 Rule 3.1(c) shall be amended to read “during the period of six months
after the date of death of the Participant as set out in rule 4.4; or” 
  
 APPENDIX 4 
  
 Denmark 
  
 The Plan will apply to options granted to residents of Denmark with the following modification: 
  

Where the provisions of rule 4.1, 4.3 and 4.6 conflict with Danish law, Danish law will prevail and the terms of these rules will be taken to be amended
accordingly but only in respect of Options granted to employees in Denmark. 

  
 16 

 APPENDIX 5 

 
 France 

 
 The Plan will apply to Options granted to
residents of France subject to the following modifications: 
  

Eligible Employees can be either the employees, the Chairman of the Board (Président du Conseil), the Managing Directors (Directeurs
Généraux) or Managers (Gérants) as defined in Section L 225-185 of the French Commercial Code, of a French company satisfying the conditions mentioned in Section L 225-180 of the same Code. 

 
 Notwithstanding any other provision of the Plan, an Option cannot be granted
to any Eligible Employee who owns more than 10% of the ordinary share capital of the Company then in issue. 
  
 In the case of an Option over Shares, the exercise price determined under rule 1.5 must be at least equal to 80% of the arithmetical average of the middle market quotations of a Share (as derived from the
London Stock Exchange Daily Official List) on the 20 Business Days last preceding the Grant Date, rounded to the nearest whole penny. 
  

In the case of an Option over ADSs, the price at which ADSs may be acquired by the exercise of an Option shall be at least equal to 80% of the fair market
value of an ADS as quoted on NASDAQ on the 20 Business Days last preceding the Grant Date. 
  
 Notwithstanding rule 6.7 of the Plan, the price at which Shares may be acquired by the exercise of the Option shall be adjusted only upon the occurrence of the events specified under Section L 225-181 of
the French Commercial Code. 
  
 Notwithstanding rule 4.6 of the Plan,
on the death of a Participant at a time when the Option in question has not lapsed, the Option may not be exercised later than six months after the date of his death. 

 
 Notwithstanding what is set out under Exercise date of the Glossary (but
subject to Rules 4.3, 4.4 and 6.1 (a), an Option granted under the Plan may not be exercised before the day after the third anniversary of the Grant Date. 
  

A Director within the meaning of Section L225-185 of the French Commercial Code shall be required to retain (either registered in his own name or
deposited with a nominee on his behalf) a proportion of the Shares received as a result of exercising an Option as determined by the Compensation Committee, until he ceases his role as a Director. If no other proportion is determined when the
relevant Option is granted, the proportion required to be retained will be 10%. 
  
 Notwithstanding any other provision of the Plan, an Option granted more than 76 months after the Plan was last approved by shareholders as required by Rule 9.4.1 of the Listing Rules of the UK Listing
Authority cannot be satisfied by any means involving the issue of new Shares or the transfer of Treasury Shares. 
  
 A director of the Company cannot be granted an Option. 
  
 APPENDIX 6 
  
 Hong Kong 
  
 The
Plan will apply to Options granted to residents of Hong Kong with the addition of the following rules: 
  
 Any Shares acquired by a Participant under the Plan cannot be traded within Hong Kong within 6 months of the date of exercise of the relevant Option and, by receiving those Shares, each Participant shall
be taken to have agreed to observe this restriction. 

  
 17 

 Notwithstanding any other provision of the Plan, the grant of Options under and the operation of the Plan
does not constitute an offer or invitation to the public within the meaning of the Companies Ordinance or the Securities and Futures Ordinance. 
  

APPENDIX 7 
  

Ireland 
  

The Plan will apply to Options granted to residents of the Republic of Ireland with the following modification:

  
 In Rule 3.1(a), delete “tenth” and substitute
“seventh” and delete “or any earlier date determined by the Compensation Committee at the time the Option is granted”. 
  

APPENDIX 8 
  

Russia 
  

The Plan will apply to Options granted to residents in Russia with the following modification: 

 
 For the purposes of the securities laws of Russia, all transactions carried
out and contracts entered into in connection with the Plan and any Shares acquired by Participants will be carried out or entered into outside Russia. 
  

APPENDIX 9 
  

UK tax-advantaged Options 
  

Options granted under this appendix (which will be referred to as “CSOP Options” in this appendix) will be UK tax-advantaged options
under a “Schedule 4 CSOP scheme” for the purposes of Schedule 4 to the Income Tax (Earnings and Pensions) Act 2003. In the event of any conflict between the Plan and the provisions of this appendix 9 (“Appendix 9”), the
latter will prevail. The terms of Appendix 9 will be identical to those of the other parts of the Plan (excluding all appendices other than Appendix 9), except as follows: 

 

	1	Purpose 

  

	 	(a)	 	The purpose of Appendix 9 is to provide CSOP Options for Eligible Employees in accordance with Schedule 4 and not otherwise. 

 

	 	(b)	 	Any provision of the Plan will not be effective with respect to a CSOP Option if the effect of that provision would be to prevent that CSOP Option from meeting the
requirements of Schedule 4, including rules 3.8 (cash settlement of options and cash awards), 5.1 (overpayment of performance remuneration), 6.1(b) (early exercise on a “squeeze-out”), 6.1(c) (early exercise on a scheme of arrangement),
6.4 (exchanging Options rather than early exercise) and 6.5 (terms of exchanged Options). 

  

	2	Glossary 

  

In the glossary before rule 1: 
  

	 	(a)	 	a new definition will be added, worded as follows: 

  

“Schedule 4” means Schedule 4 to the Income Tax (Earnings and Pensions) Act 2003; 

  
 18 

	 	(b)	 	the definition of “Eligible Employee” will be: 

  

	 	  	 	“a person who is not prohibited from participating in the Plan by virtue of paragraph 9 of Schedule 4 (material interest) and is: 

 

	 	(a)	 	in respect of a CSOP Option that is an Executive Option, a full-time executive director or an employee (without being a director) of the Company or a Subsidiary; and

  

	 	(b)	 	in respect of any other CSOP Option, an employee whose working time for one or more of the Company and its Subsidiaries equals or exceeds a period determined by the
Compensation Committee at the relevant Grant Date;” 

  

	 	(c)	 	at the end of the definition of “Market Value” will be added: 

 

	 	  	 	“If Shares are not quoted on the Official List, before the Grant Date the value of a Share must be agreed with Shares and Assets Valuation at HM Revenue &
Customs”; 

  

	 	(d)	 	the definition of “Shares” will be: 

  

“fully paid ordinary shares (including treasury shares) in the capital of the Company which satisfy the requirements of paragraphs
16-18 and 20 of Schedule 4”; and 
  

	 	(e)	 	the definition of “Subsidiary” will be: 

  

“a company that is a subsidiary of the Company within the meaning of Articles 2 and 2A of the Companies (Jersey) Law 1991 and is
under the control of the Company within the meaning of Section 719 of the Income Tax (Earnings and Pensions) Act 2003”. 
  

	3	No CSOP Options over ADSs 

  

CSOP Options may only be granted over Shares, and not over ADSs, and therefore references to ADSs or Options over ADSs will not apply to a
CSOP Option. 
  

	4	Personal limit 

  

Add the following to the end of rule 1.7: 
  

“provided that a Participant cannot be granted CSOP Options which would, at the time they are granted cause the aggregate market
value (determined as at the date of each relevant grant) of the Shares which that Participant may acquire from unexercised CSOP Options granted to that Participant and any other Schedule 4 CSOP scheme established by the Company or by any associated
company of the Company to exceed or further exceed £30,000 (or any other limit that may be prescribed by paragraph 6 of Schedule 4)”. 
  

	5	Grant requirements 

  

To rule 1.13 (terms to be specified in grant documents) will be added: 
  

	 	“(f)	 	the description of the Shares; 

  

	 	(g)	 	any restrictions to which the Shares may be subject; 

  

	 	(h)	 	the times at which the CSOP Option may be exercised (in whole or in part); 

 

	 	(i)	 	any Performance Condition (which must be determined on or before the Grant Date) applicable to the CSOP Option; and 

 

	 	(j)	 	the circumstances under which the CSOP Option will lapse or be cancelled (in whole or in part) including any conditions to which the exercise of the CSOP Option is
subject (in whole or in part), 

  
 and
these terms, together with any mechanism for the variation of the terms of CSOP Options under rules 7.1 or 7.3, must be notified to the Participant as soon as practicable after the Grant Date.” 

  
 19 

	6	Transferability of CSOP Options 

  

Rule 2.1 be amended to read: 
  

“CSOP Options are not capable of being transferred, but the personal representatives of a Participant who has died may exercise a
CSOP Option under rule 3.1(c).” 
  

	7	Death of a Participant 

  

To the start of rule 3.1(a), add the words “Subject to rule 3.1(c)”. 
  
 Add the following to the start of rule 3.1(c): “at any time” and the following at the end of rule
3.1(c): “even if that period ends after the tenth anniversary of the Grant Date or after any period for exercise that would otherwise be allowed under the Plan, except in the case of exercise under rule 6.1(d) (early exercise on winding
up)”. 
  
 In rule 4.4, the words “Unless
the Compensation Committee decides otherwise” and rule 4.4(b) will be deleted. 
  

	8	Timing of exercise 

  

Add the following to the end of rule 3.1: 
  

“A Participant cannot exercise a CSOP Option at any time when ineligible to participate in the Plan by virtue of paragraph 9 of
Schedule 4 (material interest)”. 
  

	9	Responsibility for tax 

  

Rule 3.9 will not apply to employer’s National Insurance contributions relating to CSOP Options and, in respect of any non-UK
taxation of a Participant relating to a CSOP Option, will only be operated in such a way as to ensure that it does not cease to be a CSOP Option. 
  

	10	Methods of paying tax 

  

Rule 3.10 will be worded as follows: 
  

“If any Member of the Group or any Trustee has to pay or account for any item referred to in rule 3.9, the relevant Participant must
be offered the opportunity to pay or repay that amount on demand. Instead, or in addition, the Participant can authorise the Member of the Group or Trustee to do any one or more of the following: 

 

	 	(a)	 	sell sufficient of the Shares subject to the CSOP Option on behalf of the Participant and retain the proceeds or pay them to any tax authority; and/or

  

	 	(b)	 	deduct the amount from any amount to which the Participant is entitled under the Participant’s employment contract or otherwise.” 

 

	11	Good leavers 

  

In Rule 4.3 the words “unless the Compensation Committee decides otherwise,” and the last sentence are deleted. 

  
 20 

	12	Early exercise on company events 

  

Rule 6.1 will read as follows: 
  

“Subject to rules 6.2 to 6.4, CSOP Options will become exercisable under this rule 6 if: 

 

	 	(a)	 	a person (or a group of persons acting in concert) obtains Control of the Company as a result of making a general offer to acquire: 

 

	 	(i)	 	the whole of the issued ordinary share capital of the Company (ignoring any already held by the person or group of persons making the offer) which is made on condition
such that, if it met, the person making the offer will have Control of the Company; or 

  

	 	(ii)	 	all the shares of the Company which are of the same class as the Shares (ignoring any Shares already held by the person or group of persons making the offer)

  
 and for these purposes, it does
not matter whether the general offer is made to different share owners by different means; or 
  

	 	(b)	 	a person becomes bound or entitled to acquire Shares under Part 18 of the Companies (Jersey) Law 1991 (“squeeze-out”); or 

 

	 	(c)	 	the court sanctions a scheme of arrangement under Part 18A of the Companies (Jersey) Law 1991 being a compromise or arrangement applicable to or affecting:

  

	 	(i)	 	all the ordinary share capital of the Company or all shares of the same class as the Shares; or 

  

	 	(ii)	 	all the Shares, or all the shares of that same class, which are held by a class of share owners identified other than by reference to their employment or directorships
or their participation in a Schedule 4 CSOP Scheme; or 

  

	 	(d)	 	a non-UK company reorganisation arrangement (as defined from time to time in paragraph 35ZA of Schedule 4) applicable to or affecting: 

 

	 	(i)	 	all the ordinary share capital of the Company or all shares of the same class to which a CSOP Option relates; 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 their employments or directorships or their
participation in a Schedule 4 CSOP Scheme; 

  
 becomes binding on the shareholders covered by it. 
  

	13	Shares ceasing to qualify 

  

If in consequence of a transaction affecting the Company specified in rule 6.1 (change of Control etc.), the Shares subject to outstanding
CSOP Options cease to satisfy the requirements of Schedule 4, those CSOP Options may, if the Compensation Committee so determines, instead be exercised within 20 days of the relevant transaction as if those requirements were still satisfied and the
CSOP Options will be treated as having been exercised in accordance with the relevant requirements of paragraph 25A of Schedule 4 (company events). If the Compensation Committee exercises this power, any unexercised CSOP Options will lapse at the
end of this period. 
  

	14	Exchange of CSOP Options 

  

Rules 6.4 and 6.5 (exchanging Options rather than early exercise on a transaction affecting the Company) will be read and interpreted, and
if necessary amended, in such a way that the requirements of Part 6 of Schedule 4 are complied with (company over whose shares the replacement options are granted and equivalence of original and replacement options). 

  
 21 

	15	Demerger 

  

Rule 6.6 will be worded as follows: 
  

“If the Company is affected by a demerger (in whatever form) or a special dividend or distribution, which in the opinion of the
Compensation Committee would affect the current or future value of any CSOP Options, the Compensation Committee may decide that CSOP Options will become exercisable, in which case rules 6.2 and 6.3 will apply as if the CSOP Options had become
exercisable under rule 6.1.” 
  

	16	Adjustment of CSOP Options 

  

At the end of rule 6.7 (adjustment of Options on a variation in capital) the words “provided that any adjustment must: 

 

	 	(i)	 	ensure that both the aggregate market value of the Shares subject to the CSOP Option and the total exercise price for that CSOP Option are substantially the same after
the adjustment as they were immediately before the adjustment; and 

  

	 	(ii)	 	not result in the requirements of Schedule 4 ceasing to be satisfied” will be added. 

  
 In rule 6.7(b) the word “class” is deleted. 
  

	17	Variation of terms of CSOP Option 

  

A new rule 7.4 will be added, worded as follows: 
  

“7.4 The terms of a CSOP Option may only be varied: 

 

	 	(a)	 	in the case of exercise price, only under rule 6.7; 

  

	 	(b)	 	in the case of the number or description of Shares, only under rule 6.7 or by way of a mechanism stated at the Grant Date; and 

 

	 	(c)	 	in the case of any other term, by way of a mechanism stated at the Grant Date; 

 

	 	  	 	and any mechanism used for (b) or (c) must be applied in a way that is fair and reasonable” 

 

	18	Amendments 

  

A new rule 7.5 will be added, worded as follows: 
  

“7.5 Appendix 9 may not be amended if the amendment would cause Appendix 9 to cease to be a “Schedule 4 CSOP scheme” within
the meaning of paragraph 1(A1) of Schedule 4 and in respect of any amendment to a key feature of Appendix 9 (being a provision that is necessary in order to meet the requirements of Schedule 4) the Company will make a declaration to HM
Revenue & Customs in the next annual return relating to Appendix 9 that the alteration has not caused Appendix 9 to cease to meet the requirements of Schedule 4.” 

 
 APPENDIX 10 

 
 USA 

 
 Special Rules Applicable to Grants of Incentive Stock Options

  
 Options granted in accordance with the Plan may be
designated as “Incentive Stock Options” (“ISOs”) within the meaning of section 422 of the United States Internal Revenue Code of 1986, as amended (the “US Tax Code”). 

  
 22 

 The aggregate number of Shares (including Shares comprised in any WPP ADS) over which ISOs may be granted
under this appendix will not exceed . 
  
 Eligible Employees who may
receive ISOs will, in addition to the limitations imposed by rule 1.3 of the Plan, be limited to employees of the Company or its “parent” or “subsidiary” corporations within the meaning of sections 424(f) and (g), respectively,
of the US Tax Code. 
  
 In addition to any other restrictions
contained in the Plan, ISOs will not be transferable otherwise than by will or the laws of descent and distribution. During the lifetime of the Participant to whom an ISO is granted, the ISO will be exercisable only by that Participant.

  
 To the extent that the aggregate market value of Shares
(including Shares comprised in any WPP ADS) with respect to which ISOs are exercisable (determined without regard to this sentence) for the first time by a Participant during any calendar year (under all plans or schemes of the Company or its
“parent” and “subsidiary” corporations within the meaning of sections 424(f) and (g), respectively, of the US Tax Code) exceeds US $100,000, those Options will to the extent of the excess be treated as Options which are not
ISOs. For this purpose, the market value of any Shares (including Shares comprised in any ADS) subject to an ISO will be determined at the time that ISO is granted. 

 
 This appendix will be deemed to be included within the Plan as adopted by
shareholders for the purpose of any ISO grants. 
  
 Taxpayers
Subject to Section 409A of the United States Internal Revenue Code 
  
 The Plan will apply to participants who are taxpayers subject to Section 409A of the United States Internal Revenue Code (“Section 409A”), with the following modifications: 

 
 Options granted under the Plan are intended to be exempt from the
requirements of Section 409A by satisfying the requirements of the exemption under Section 1.409A-1(b)(5)(i)(A) of the United States Treasury Regulations or other applicable guidance (the “Exemption”). The Plan will be
construed and interpreted in accordance with that intent. Any discretion afforded to any person or entity under the Plan the existence of which itself would cause an Option to fail to satisfy the requirements of the Exemption will not
apply.
  
 At the end of paragraph (b) of the definition of
“Market Value” after the words “Grant Date”, add the words “provided that the price will not be less than fair market value determined in accordance with Section 409A.”

 
 Add the following paragraph to the end of Rule 6.7: 

 
 “Notwithstanding the foregoing, only adjustments permitted by
Section 409A will be permitted to be made under this Rule 6.7, including pro rata adjustments necessary to reflect a stock split, reverse stock split, and stock dividend.” 

  
 23

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