London Stock Exchange : Equity Incentive Plan Rules

LONDON STOCK EXCHANGE GROUP PLC

London Stock Exchange Group

Equity Incentive Plan

Adopted by the Board on 27 February 2024

As approved by ordinary resolution of the shareholders at the annual general meeting of the Company on [25 April] 2024

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	CONTENTS
RULE		PAGE
1.	GRANT OF AWARDS	1
2.	PERFORMANCE CONDITIONS	2
3.	RESTRICTED SHARE AWARDS	3
4.	VESTING OF AWARDS	3
5.	HOLDING PERIOD	5
6.	ENTITLEMENT TO DIVIDEND EQUIVALENTS	5
7.	LEAVERS	6
8.	ISSUE, TRANSFER OR LISTING OF SHARES	8
9.	LAPSE OF AWARDS	8
10.	CORPORATE EVENTS	9
11.	OTHER CORPORATE EVENTS	11
12.	MALUS, CLAWBACK AND FREEZING	12
13.	TAXATION	15
14.	GRANT LIMITS	15
15.	AMENDMENT AND ADMINISTRATION	16
16.	GENERAL	16
17.	GOVERNING LAW	18
APPENDIX 1 DEFINITIONS	19
APPENDIX 2 AWARDS TO NON-EMPLOYEES	24

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CORPORATE

THE RULES OF THE LONDON STOCK EXCHANGE GROUP

EQUITY INCENTIVE PLAN

1. GRANT OF AWARDS

1. The Committee may, in its absolute discretion, determine which Employees (if any) will be selected for the grant of an Award. Awards may then be granted to selected Employees, with any such grants to be made normally during a Grant Period. For the avoidance of doubt, an Award granted under this Plan to an individual who is under notice at the relevant Grant Date (whether by way of error or otherwise) shall not be effective and shall be treated as if it had never been granted.
2. The Committee will determine whether an Award will take the form of an Option, a Conditional Award, a Phantom Award or a Restricted Share Award. An Employee may be granted any form of Award or any combination of Awards.
3. Notwithstanding any of the Rules, the terms on which Awards may be granted to executive directors of the Company shall be subject to and made in accordance with the terms of the directors' remuneration policy as approved by shareholders of the
   Company from time to time.
4. Each Award shall be evidenced by a Grant Agreement issued by the Company or such other documentation as the Committee may determine in its absolute discretion. By accepting an Award and the terms of the associated Grant Agreement, a Participant will be bound by these Rules (including in particular Rule 12). If a Participant does not formally accept an Award and the terms of the associated Grant Agreement on the basis specified by the Company, that Award will be treated as if it had never been granted.
5. The Grant Agreement may include the following details:
6. 1. the Grant Date;
   2. the form of the Award;
   3. the number of Shares comprising or subject to the Award;
   4. the Vesting Date(s) of the Award;
   5. if applicable, what Performance Condition(s) shall apply to the Award (and the applicable Performance Period(s));
   6. if the Award will take the form of an Option or Phantom Option, the Exercise Period (or the Committee may determine that the Option or Phantom Option shall be deemed to be exercised automatically on the Vesting Date without requiring the Participant to take any action to exercise the Option or Phantom Option);
   7. whether an Award carries Dividend Equivalents;
   8. whether any other terms or conditions shall apply to the Award and the detail of those terms and conditions (as determined by the Committee); and

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1. 1. whether a Holding Period will apply to the Award and, if so, the terms of that Holding Period.
2. The Committee may, at any time between the Grant Date and a relevant Vesting Date, determine that an Award granted as a Conditional Award or Phantom Award should instead be treated as if it had been granted as an Option or Phantom Option and vice versa. Any Award subject to such a determination shall not be treated as a grant of a new Award for the purposes of these Rules.
3. No Award shall be granted under the Plan more than ten years after the Adoption Date.
4. Every Award granted under this Plan shall be personal to the Participant to whom it is granted and, except to the extent necessary to enable a personal representative to realise the Award following the death of a Participant, neither the Award nor the benefit of that Award may be transferred, assigned, charged or otherwise alienated. An Award will lapse immediately if the Participant to whom it was made purports to transfer, charge or otherwise alienate that Award otherwise than as permitted by this Rule 1.8.
5. The grant of any Award (including an Award in respect of notional Shares) under the Plan shall be subject to any applicable Dealing Restrictions.
6. Notwithstanding Rule 1.1 and the definition of "Employee", the Committee may, in its absolute discretion and in exceptional circumstances, grant an Award to an individual who is an employee of any member of the Group but under notice at the relevant Grant Date. If it does so, that individual will be treated as an "Employee" and "Participant" for the purposes of these Rules.

2. PERFORMANCE CONDITIONS

1. The Committee may determine that the Vesting of an Award will be dependent upon the satisfaction of Performance Conditions.
2. The Committee can set different Performance Conditions for Awards granted in different years or to different Participants at the same time (in terms of the type of condition, the weighting given to that Performance Condition and any targets applicable to each Performance Condition).
3. The Committee may determine that an Award should be subject to multiple Performance Conditions or that an Award should be sub-divided and that each part be subject to a different Performance Condition.
4. An Award will Vest as to the percentage of Shares (or, in the case of an Award which is granted in the form of a Phantom Award, notional Shares) determined in accordance with the Performance Conditions. An Award shall lapse to the extent that the Performance Conditions are not met.
5. The Committee may vary the Performance Conditions applying to existing Awards if an event occurs or there are circumstances (for example, an acquisition or disposal of a business or a significant part of a business) such that the conditions are no longer a fair measure of performance, provided that in the reasonable opinion of the Committee the new conditions are not materially less challenging than the original conditions would have been but for the event or circumstances in question. In exercising any power to

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vary the Performance Conditions, the Committee will have regard to ensuring fairness between Participants and shareholders.

2.6 The Committee shall, as soon as reasonably practicable, notify a Participant of any determination made under Rule 2.4 or 2.5.

3. RESTRICTED SHARE AWARDS

1. If an Award takes the form of Restricted Shares, the Employee may be required, either before the Grant Date or within such period after the Grant Date as the Committee may specify, to enter into an irrevocable agreement with the Company (and, if different, the Employee's employing company) in such form as the Company may prescribe. This may include an agreement by the Employee:
2. 1. not to transfer, assign, sell, pledge, charge or otherwise dispose of any Restricted Shares subject to the Award except to the extent that the Award has Vested; and
   2. to transfer (or procure the transfer) to (or to the order of) the Company, for a total of £0.01 (one penny), all the Restricted Shares in respect of which the Award lapses.
3. If the Employee does not enter into any required agreement in accordance with Rule 3.1 either before the Grant Date or within such period after the Grant Date as the Committee may specify, the Award will not be granted or if it has been granted, such grant shall be ineffective.
4. On or before the Grant Date for an Award which takes the form of Restricted Shares, or as soon as reasonably practicable after the Grant Date if the Committee so determines, the Company shall (or the relevant employing company shall procure that the Company shall) issue or transfer to the Participant or to the Trustee the number of Shares subject to the Award.
5. To the extent that a Restricted Share Award Vests, the agreement referred to in Rule 3.1 shall cease to have effect in relation to the Restricted Shares subject to it.
6. If the Committee so requires, the Participant will, within all applicable time periods, enter into a relevant tax election (including an election under section 431 of the Income Tax (Earnings and Pension) Act 2003) in connection with and as a condition of their acquisition of Restricted Shares.

4. VESTING OF AWARDS

1. Except as otherwise permitted in these Rules, an Award shall Vest on the Vesting Date, subject to and to the extent that any applicable Performance Conditions or other conditions which apply to that Award have been met.
2. An Award will only Vest in accordance with Rule 4.1:
3. 1. if the Participant has complied with all regulatory and legal requirements that may apply to the Participant in respect of or in connection with the Award;

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1. if the Participant has provided any relevant information, and made any relevant elections, as reasonably requested by the Company; and
2. if and to the extent that the Participant, subject to these Rules, is free from any Dealing Restrictions.

The Award will, unless the Committee determines otherwise, lapse on the Vesting Date to the extent that these conditions have not been satisfied, provided that, where condition (c) above is not satisfied, the Award will Vest as soon as practicable (as determined by the Committee) following the date on which it is satisfied.

1. Unless determined otherwise by the Committee at the Grant Date and notwithstanding this Rule 4, in respect of an Award which is subject to Performance Conditions, the Vesting Date shall be no earlier than the third anniversary of the Grant Date.
2. Subject to any arrangements to give effect to the Holding Period in accordance with Rule 5, Vested Shares under Conditional Awards will be released to Participants within 30 days following the Vesting Date. A Participant need take no action to realise a Conditional Award other than pay the Company any amount specified at the Grant Date.
3. Subject to Rule 10.2, Vested Options and Vested Phantom Options will be exercisable during the Exercise Period, after which they will lapse. Where an Award is granted in the form of an Option or Phantom Option, a Participant may (subject to any Dealing Restrictions, payment of the Option Exercise Price and the remainder of this Rule 4.5) exercise a Vested Option or Vested Phantom Option by written notice to the Company in the form required by the Company at any time during the Exercise Period. A notice of exercise will take effect on the date it is accepted as valid by the Company or, if there are any Dealing Restrictions in place on that date, as soon as practicable (as determined by the Committee) on or after such later date when all Dealing Restrictions have lifted. Subject to any Dealing Restrictions and any arrangements to give effect to the Holding Period in accordance with Rule 5, the Shares comprised in a Vested Option will be issued or transferred to the Participant within 30 days following the date the notice of exercise takes effect.
4. Vested Restricted Shares will cease to be subject to the risk of forfeiture on Vesting.
5. Vested Phantom Awards shall be satisfied in the next available payroll (as determined by the Committee) following the Vesting Date (or in the case of a Phantom Option, following a valid exercise of that Phantom Option) by a payment of a Cash Amount.
6. The Committee may, in its absolute discretion, decide to amend the vesting outcome of an Award when it considers it appropriate to do so to reflect the wider performance of the Company or any member of the Group and/or outcomes for shareholders over the Vesting Period. Any such amended Vesting outcome may operate, at the
   Committee's absolute discretion, in respect of any Award or Awards held by:
7. 1. an individual Participant;
   2. such wider group of Participants as the Committee may determine to be appropriate; or
   3. all Participants.

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4.9 Notwithstanding the above:

1. the Committee will have discretion (to the extent permitted by any applicable law) to delay the Vesting of a Participant's Award if on or before the relevant Vesting Date the Committee considers that it is appropriate to do so having regard to any Dealing Restrictions or any statute, regulation or similar code to which the Company is subject; and
2. Vesting of an Award may be delayed where the Committee determines that it is appropriate to Freeze such Award pursuant to Rule 12.6.

5. HOLDING PERIOD

1. The Committee may in its absolute discretion determine prior to the Grant Date whether or not to impose a mandatory Holding Period in respect of an Award. Notwithstanding any other provisions of these Rules, the Shares or Options subject to the Holding Period may not be transferred, assigned, sold, pledged or otherwise disposed of during the Holding Period except (in the case of Shares) to satisfy any tax liability of the Participant that has been incurred in connection with the Award. The Committee may impose such requirements as it considers necessary or desirable to ensure Participants observe the Holding Period including, but not limited to, requiring Participants to hold the Shares via a Trustee.
2. Unless the Committee determines otherwise, during the Holding Period the Participant will (subject to the terms of any applicable nominee arrangement) be entitled to vote and, subject to Rule 5.3, to receive dividends and have all other rights of a shareholder in respect of any Vested Shares (excluding notional Shares) that are subject to the Holding Period.
3. Unless the Committee determines otherwise, any cash dividends or other cash payments received in respect of Vested Shares that are subject to a Holding Period will be reinvested into the acquisition of further Shares. Unless the Committee determines otherwise, those further Shares will also be subject to the remaining same Holding Period as the underlying Vested Shares.
4. A Participant shall take such steps as the Committee may reasonably require and respond to such information requests as may reasonably be made to satisfy the
   Committee as to the Participant's observance of the Holding Period.
5. The Committee may at any time during a Holding Period determine that the Holding Period shall cease to apply to all or some of the Shares or Options subject to that Holding Period.

6. ENTITLEMENT TO DIVIDEND EQUIVALENTS

6.1 The Committee may in its discretion:

1. grant an Award on the basis that it carries Dividend Equivalents; and/or
2. determine that an Award carries Dividend Equivalents at any time prior to Vesting of the relevant Award.

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1. If an Award carries a right to Dividend Equivalents, the Participant will be entitled to be issued with or transferred Shares or cash (as determined by the Committee) equal in value to the ordinary dividends to which the Participant would have been entitled during the Vesting Period on the Shares comprised in the Award which Vest. Dividend Equivalents will be paid or delivered on or around the date the Award is satisfied by the Company to the extent that the Award Vests.
2. The number of Shares or the cash payment to which the Participant becomes entitled under Rule 6.2 will be calculated in such manner as the Committee in its absolute discretion determines. Unless the Committee determines otherwise:
3. 1. the relevant figure will be calculated by reference only to ordinary dividends and without regard to special dividends or distributions, super dividends or dividends-in-specie;
   2. with respect to the number of Shares, a Participant's entitlement shall comprise whole Shares only.
4. For the avoidance of doubt:
5. 1. any payment referred to in this Rule 6 does not represent an entitlement to actual dividends on the underlying Shares, by reason of the Participant not being the beneficial owner of the Shares at that time; and
   2. the Committee may determine that Awards granted in different years or to different Participants at the same time may be treated differently in respect of any right to Dividend Equivalents.

7. LEAVERS

1. Save as otherwise provided in these Rules, an Award that has not Vested will lapse automatically on the Participant's Notice Date, save that the Committee may determine in its absolute discretion that an Award shall be deemed to have continued and instead lapse on the Participant's Termination Date.
2. If a Participant gives or receives notice of termination of their employment or otherwise ceases employment with the Group at any time before the Vesting Date applicable to an Award by reason of:
3. 1. their death;
   2. their injury, disability (as agreed by the Committee) or ill-health;
   3. their redundancy (as determined by the Committee in its absolute discretion);
   4. the sale of the business or company in which the Participant is employed out of the Group;
   5. their retirement (as determined by the Committee); or
   6. any other reason where the Committee so determines in its absolute discretion,

their Award will continue and will Vest on the original Vesting Date, subject to the achievement of any Performance Conditions at that time and Rules 7.3 to 7.4.

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1. If Rule 7.2 applies, subject to Rule 7.4, the number of Shares in respect of which an Award will Vest will be reduced by multiplying it by A/B, where:
2. 1. A is that part of the Vesting Period measured in whole days from the start of the Vesting Period to the Termination Date (or the Notice Date, or such other date between the Notice Date and the Termination Date, if the Committee so determines), and which cannot be greater than B; and
   2. B is a number equal to the number of days in the relevant Vesting Period.
3. Notwithstanding Rule 7.1 and Rule 7.3:
4. 1. Awards (whether subject to Performance Conditions or not) may Vest (and, in the case of an Option or Phantom Option, become exercisable) on such earlier date as may be determined by the Committee (being no earlier than the Termination Date), in which case the Committee will determine the extent of Vesting by reference to the extent to which any Performance Conditions have been satisfied at such earlier date;
   2. the Committee may, in its absolute discretion:
   3. 1. notwithstanding the provisions of this Rule 7, determine on or before the Grant Date how an Award is to be treated if the Participant ceases employment with the Group for any reason; and/or
      2. take an alternative approach to release fewer Shares, or a greater number of Shares, if it considers that this is appropriate in light of any relevant factors determined by the Committee;
   4. Vesting may be delayed in accordance with Rule 4.9; and
   5. different tranches of Awards, or Awards made to different Participants at the same time, may be treated differently for the purposes of this Rule 7.

Following the application of Rule 7.3 and/or Rule 7.4 to an Award, the remaining part of the Award that is not capable of Vesting shall lapse automatically. For the avoidance of doubt, an Award which Vests (and, in the case of an Option or Phantom Option, becomes exercisable) under this Rule 7 may lapse at an earlier date by virtue of Rule 10.

1. The Committee may make the exercise of any of its discretions under Rules 7.2 to 7.4 subject to such conditions or terms as it considers appropriate.
2. Where a Participant holds Vested Shares or Options that are subject to a Holding Period and the Participant's Notice Date and/or Termination Date occurs during that Holding Period, such Shares or Options will continue to be subject to the Holding Period save that the Committee may, at its discretion, allow early release of some or all of the Vested Shares or Options prior to the end of the Holding Period.
3. Notwithstanding the above, the Committee may Freeze a Participant's Award in accordance with Rule 12.6.

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1. A Participant will not cease to be an Employee for the purposes of this Rule 7 if they cease to be employed by a member of the Group but continue to be or are immediately afterwards employed by another member of the Group.
2. Without prejudice to Rule 11, where a Participant ceases to be employed by a member of the Group at any time before the Vesting Date of an Award by reason of the demerger by the Company of the business or division in which they are employed, the Committee may determine for some or all Participants leaving the Group as a result of the demerger that part or all of the Award shall vest (in which case the provisions of Rules 7.2 to 7.4 shall apply) and/or that Awards held by such Participants should be rolled over into equivalent awards over shares in the demerged company (or on such other terms as the Committee shall agree with that company).

8. ISSUE, TRANSFER OR LISTING OF SHARES

1. Subject to Rule 8.2, the Committee will procure the issue or the transfer of Shares (which may include Treasury Shares) pursuant to:
2. 1. a Conditional Award within 30 days following the Vesting Date; and
   2. the exercise of an Option, within 30 days following the date on which exercise takes effect.
3. The Committee may (instead of delivering Shares following the Vesting of an Award) elect to pay or procure the payment of the equivalent Cash Amount, subject to deductions for any tax or other levy which the Committee reasonably determines should be deducted from the Cash Amount. The Committee may in its discretion pay or procure the payment of any cash sum in pounds sterling or the equivalent in a
   Participant's local currency (converted on the basis of such exchange rate as the
   Committee may in its discretion determine).
4. Shares to be issued pursuant to the Plan will rank pari passu in all respects with the Shares then in issue, except that they will not rank for any rights attaching to Shares by reference to a record date preceding the date of issue.
5. Shares to be transferred pursuant to the Plan will be transferred free of all liens, charges and encumbrances and together with all rights attaching thereto, save as may be necessary or desirable to enforce any applicable Holding Period.
6. For so long as the Shares are admitted to listing, application will be made for any newly issued ordinary shares to be admitted to such listing and admitted to trading on the London Stock Exchange.

9. LAPSE OF AWARDS

9.1 Awards shall lapse upon the occurrence of the earliest of the following events:

1. to the extent that it is determined by the Committee that the Performance Conditions applicable to an Award have not been met following the expiry of the relevant Performance Period, the expiry of that Performance Period;
2. to the extent that it is determined by the Committee that any other condition applicable to an Award has not been met, the date on which it is so determined;

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