Dialight : Proposed Rules of the Dialight plc 2023 Restricted Share Plan to be read with Notice of Annual General Meeting 2023

DIALIGHT PLC

RULES OF THE DIALIGHT PLC 2023 RESTRICTED SHARE

PLAN

Approved by shareholders of the Company in general meeting on [16 May] 2023

Adopted by the remuneration committee of the board of the Company on 22 March 2023

EUSLFISHE403602258.01

	CONTENTS
CLAUSE		PAGE
1.	DEFINITIONS AND INTERPRETATION	3
2.	GRANT OF AWARDS	5
3.	PERFORMANCE CONDITIONS	7
4.	LIMITS	7
5.	VESTING OF AWARDS	9
6.	CONSEQUENCES OF VESTING	10
7.	EXERCISE OF OPTIONS	11
8.	CASH ALTERNATIVE	12
9.	LAPSE OF AWARDS	13
10.	LEAVERS	13
11.	TAKEOVERS AND OTHER CORPORATE EVENTS	15
12.	ADJUSTMENT OF AWARDS	17
13.	ALTERATIONS	17
14.	MISCELLANEOUS	18
SCHEDULE 1	21
SCHEDULE 2	22
SCHEDULE 3	24

1. DEFINITIONS AND INTERPRETATION

1.1 In the Plan, unless the context otherwise requires:

"Admitted" means admitted to the premium segment of the official list maintained by the FCA and admitted to trading on the London Stock Exchange's market for listed securities;

"Award" means a Conditional Award or an Option;

"Board" means the board of directors of the Company or a duly authorised committee of the Board or a duly authorised person;

"Committee" means the remuneration committee of the Board or other duly authorised committee which fulfils the same function;

"Company" means Dialight plc (registered in England and Wales with registered number 2486024);

"Company's Code" means such code or codes for regulating dealings in Shares (or other securities of the Company) by directors or employees of any Group Member as may for the time being be in force;

"Conditional Award" means a conditional right to acquire Shares granted under the Plan;

"Control" means control within the meaning of section 719 of the Income Tax (Earnings and Pensions) Act 2003;

"Dividend Equivalent" means a benefit calculated by reference to dividends paid on Shares as described in Rules 2.6 and 6.3;

"Early Vesting Date" means either:

1. the date of cessation of employment of a Participant in the circumstances referred to in Rule 10.1 (Good leavers); or
2. a date of notification referred to in Rule 11.1 (General offers), the date of the relevant event referred to in Rule 11.2 (Schemes of arrangement and winding up) or the date of Vesting referred to in Rule 11.3 (Demerger and similar events);

"Eligible Employee" means any employee (including an executive director) of any Group Member;

"Exercise Period" means the period referred to in Rule 6.2 during which an Option may be exercised;

"FCA" means the Financial Conduct Authority acting in its capacity as the competent authority for the purpose of Part VI of the Financial Services and Markets Act 2000;

"Grant Date" means the date on which an Award is granted;

"Group Member" means:

1. a Participating Company or a body corporate which is the Company's holding company (within the meaning of section 1159 of the Companies Act 2006) or a Subsidiary of the Company's holding company; and
2. a body corporate which is a subsidiary undertaking (within the meaning of section 1162 of that Act) of a body corporate within paragraph (a) above and has been designated by the Board for this purpose;

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"Holding Period" means a period specified by the Committee as referred to in schedule 3; "Listing Rules" means the Listing Rules published by the FCA;

"London Stock Exchange" means London Stock Exchange plc or any successor to that company;

"Market Abuse Regulation" means Regulation (EU) No. 596/2014 of the European Parliament and of the Council of 16 April 2014 on market abuse as it is in force at the relevant time;

"Net Vested Shares" means the Vested Shares acquired or received by a Participant on or following the Vesting or exercise of an Award during the Holding Period, less: (a) a number of Shares that have an aggregate market value on the date of Vesting or exercise equal to the Participant's Tax Liability due and arising on the Vesting or exercise of the Award, or (b) if the Vested Shares are sold to satisfy the Participant's liability to Tax due on the Vesting or exercise of an Award, such number of Vested Shares so sold;

"Normal Vesting Date" means the date on which an Award vests under Rule 5.1 (Timing of Vesting: Normal Vesting Date);

"Option" means a right to acquire Shares granted under the Plan which is designated as an option by the Committee under Rule 2.2 (Type of Award);

"Option Price" means the amount, if any, payable on the exercise of an Option;

"Participant" means a person who holds an Award including their personal representatives;

"Participating Company" means the Company or any Subsidiary of the Company;

"Performance Condition" means any objective condition(s) related to performance which is specified by the Committee under Rule 2.1 (Terms of grant), Rule 3.1 or any amended or relaxed condition(s) substituted in accordance with Rule 3.2;

"Plan" means the Dialight plc 2023 Restricted Share Plan as amended from time to time;

"Rule" means a rule of the Plan;

"Shares" means fully paid ordinary shares in the capital of the Company;

"Subsidiary" means a body corporate which is a subsidiary (within the meaning of section 1159 of the Companies Act 2006) or any other company which is directly or indirectly a subsidiary of a company which itself is a Subsidiary;

"Tax Liability" means any amount of income tax or other taxes (including social security contributions) for which a Participant would or may be liable and for which any Group Member or former Group Member would or may be obliged to (or would or may suffer a disadvantage if it were not to) account to any relevant authority;

"Vest" means:

1. in relation to a Conditional Award, a Participant becoming entitled to have Shares transferred to them (or their nominee) subject to the Rules;
2. in relation to an Option, it becoming exercisable;

and "Vesting", "Vested" and "Unvested" shall be construed accordingly;

"Vested Shares" means those Shares in respect of which an Award Vests.

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1. Any reference in the Plan to any enactment includes a reference to that enactment as from time to time modified, extended or re-enacted.
2. Expressions in italics and headings are for guidance only and do not form part of the Plan.

2. GRANT OF AWARDS

2.1 Terms of grant

Subject to Rule 2.8 (Timing of grant), Rule 2.9 and Rule 4 (Limits), the Committee may resolve to grant an Award to any Eligible Employee on:

1. the terms set out in the Plan; and
2. such additional terms, whether a Performance Condition in accordance with Rule 3 and/or any other terms as the Committee may specify.

An Award may only be made in accordance with the Directors' Remuneration Policy as approved by shareholders from time to time.

1. Type of Award
   On or before the Grant Date, the Committee shall determine whether an Award shall be a Conditional Award or an Option. If the Committee does not specify the type of an Award on or before the Grant Date then an Award shall be a Conditional Award.
2. Method of grant
   An Award shall be granted as follows:
3. 1. a Conditional Award or an Option shall be granted by deed executed by the Company;
   2. if an Award is an Option, the Committee shall determine the Option Price (if any) on or before the Grant Date provided that the Committee may reduce or waive such Option Price on or prior to the exercise of the Option.
4. Indemnity from Participants
   By accepting an Award a Participant agrees to indemnify any Group Member and any other person against any Tax Liability.
5. Award certificates
   As soon as is practicable after making an Award the Company shall issue, or procure the issue of, a certificate (the "Award Certificate") to be signed and returned by the Participant within 14 days of being sent such Award Certificate. The Award Certificate shall contain such terms and conditions as the Committee shall determine (provided that they are not inconsistent with the terms of this Plan) and shall specify:
6. 1. the Grant Date;

1. the Option Price, if any;
2. the number of Shares in respect of which the Award is made;
3. any applicable Performance Condition(s) or other terms as the Committee may specify;
4. the applicable vesting schedule for the Award;

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