RULES THE RIO TINTO SHARE SAVINGS PLAN

Transcription

1 B RIO TINTO PLC RULES OF THE RIO TINTO SHARE SAVINGS PLAN Shareholders' Approval: 11 April 2002 Shareholders Re-Approval: 19 April 2012 Directors' Adoption: 28 June 2002 HMRC Approval: 26 July 2002 HMRC Ref: SRS 2756/ABM Expiry Date: 19 April 2022 Amended: 10 October 2005 and March 2011 One Silk Street London EC2Y 8HQ Telephone (44-20) Facsimile (44-20)

2 Table of Contents Contents Page 1 Definitions The Plan Additional Parts Plan limits Invitations under the Plan Application Scaling down Option Price Grant of Options Variations in share capital Exercise and lapse - general rules Exercise and lapse - exceptions to the general rules Exchange of Options Exercise of Options Share Appreciation Rights Exercise of Share Appreciation Rights General Changing the Plan and termination Governing law i

3 Rules of the Rio Tinto Share Savings Plan Principal Terms 1 Definitions The following definitions apply throughout the Plan, except to the extent specified in any Part: Business Day means a day on which any stock exchange nominated by the Directors, and on which the Shares are traded, is open for the transaction of business; Company means Rio Tinto plc; Contribution means a regular amount saved by an Optionholder under a Savings Contract; Control has the meaning specified in section 995 of the Income Tax Act 2007; Date of Grant means the date on which the Directors resolve to grant an Option; Directors means the board of directors of the Company or a duly authorised committee of it or any person with the delegated authority of that committee; Eligible Employee means any person who: (a) (b) either is an employee of a Group Company, or is a director of a Group Company who is required to work for at least 25 hours a week; and has such qualifying period (if any) of continuous service (not exceeding five years before the Date of Grant) with any one or more Group Companies as the Directors may from time to time determine. In addition it means any person who is an executive director or employee of a Group Company and is nominated by the Directors (or is nominated as a member of a category of such executive directors or employees). End Date means the last day of the month in which the last Contribution is due to be made under the relevant Savings Contract; Expiry Date means the tenth anniversary of the date of the shareholders re-approval of the Plan; Group Company means the Company and any subsidiary (and the term Group shall be construed accordingly); HMRC means Her Majesty s Revenue and Customs; ITEPA means the Income Tax (Earnings and Pensions) Act 2003; London Stock Exchange means London Stock Exchange plc; Model Code means the UK Listing Authority Model Code for transactions in securities by directors, certain employees and persons connected with them; Notional Repayment Amount means, for the purposes of calculating the number of Shares to be comprised in an Option, the total Contributions payable under a Savings 2

4 Contract plus such number of Contributions as the Directors may determine not exceeding the number of Contributions payable as a bonus under an equivalent UK HMRC approved savings related scheme; Option means a right to acquire Shares granted under the Plan and subject to the Rules; Optionholder means a person holding an Option, including his personal representatives; Option Price means the amount payable for each Share on the exercise of an Option; Shares means fully paid Ordinary Shares in the capital of the Company for the time being; Part means the Principal Terms, the UK Plan, the French Plan, the US Plan, and such other Plans as may be adopted by the Directors under Rule 3; Plan means this plan known as The Rio Tinto Share Savings Plan, or, as the context may require, any Part of the Plan; Rules means the rules of the Plan as amended from time to time; Savings Contract means a contract which is approved by the Directors for the purposes of the Plan with a savings institution as may be nominated by the Directors from time to time; Specified Age means The Plan The Plan is designed to allow employees of the Group to buy Shares in the Company, using savings deducted from their pay. The Plan comprises these Principal Terms, the UK Plan, the French Plan, the US Plan, and such other Parts as may be adopted by the Directors under Rule 3. The Principal Terms apply to all the Parts, unless specified otherwise. 3 Additional Parts The Directors may adopt additional Parts to the Plan for use in any other jurisdiction in which Options are to be granted under the Plan. All additional Parts must be subject to the Plan limits in rule 4. 4 Plan limits per cent in 10 years limit The number of Shares which may be allocated under the Plan on any day must not exceed 10 per cent of the share capital of the Company in issue immediately before that day, when added to the total number of Shares which have been allocated in the previous 10 years under the Plan and any other employee share plan operated by the Company. 4.2 Exclusions Where the right to acquire Shares is released or lapses without being exercised, these Shares are ignored when calculating the limits in this Rule. 3

5 4.3 Meaning of allocate Allocate means the grant of an option or other right to acquire unissued Shares, or if there is no such grant, the issue and allotment of Shares. 5 Invitations under the Plan 5.1 Invitations The Directors have discretion to decide whether the Plan will be operated. When they operate the Plan they may send invitations to all or some Eligible Employees. 5.2 Time when invitations may be made Invitations may only be made within 42 days starting on any of the following: (i) (ii) (iii) the day after the announcement of the Company s results for any period; any day on which the Directors resolve that exceptional circumstances exist which justify the making of invitations; any day on which changes to the legislation or regulations affecting savings related share option plans are announced, effected or made; If the Directors cannot make invitations due to restrictions imposed by statute, order, regulation or Government directive, or by any code adopted by the Company based on the Model Code, the Directors may make the invitations within 42 days after the lifting of such restrictions. 5.3 Form of invitations An invitation will specify: the Option Price or how it is to be calculated; the form of application and the date by which applications must be received; the length of the Savings Contract and the anticipated date savings will start; the maximum number, if any, of Shares over which Options may be granted; the maximum permitted Contribution, which must not be more than 250 per month (or the local currency equivalent as determined by the Company); the minimum permitted Contribution, if any, which must not be more than 10 per month (or the local currency equivalent as determined by the Company); and how the Notional Repayment Amount is calculated. 6 Application 6.1 Form of Application An application for an Option must include an application for a Savings Contract. The application will be made in writing, or electronically, in a form specified by the Directors and will require the Eligible Employee to specify: the Contribution he wishes to make; 4

6 6.1.2 that his proposed Contribution, when added to any Contributions he makes under any other Savings Contract, will not exceed the maximum permitted; and the length of the Savings Contract (if a choice is offered). 6.2 Number of Shares Each Eligible Employee s application will be for an Option over the largest whole number of Shares which he can acquire at the Option Price with the Notional Repayment Amount under the related Savings Contract. 6.3 Modification of application and proposals If there are applications for Options over more Shares than the maximum specified in the invitation, each application and proposal for a Savings Contract will be deemed to have been modified or withdrawn as described in Rule If an application for a Savings Contract specifies a Contribution which, when added to any other Contributions already being made by the Eligible Employee, exceeds the maximum permitted (whether under ITEPA, the Savings Contract or any limit specified in the invitation), the Directors are authorised to modify it by reducing the Contribution to the maximum possible amount. Any such modification must be made before the Option is granted and before the application for the Savings Contract is accepted. 7 Scaling down 7.1 Method If valid applications are received for a total number of Shares in excess of any maximum number specified in the invitation or any limit under Rule 4, the Directors will scale down applications by one or more of the following methods: reducing the proposed Contributions of each Eligible Employee by the same proportion to an amount not less than the minimum amount permitted; reducing the proposed Contributions of each Eligible Employee in excess of an amount chosen by the Directors, which must not be less than the minimum amount permitted, to an amount which is not less than the amount chosen by the Directors; reducing the proposed Contributions of each Eligible Employee by a fixed amount, provided that no Eligible Employee s Contributions may be reduced below the minimum amount permitted; reducing the proposed Contributions of each Eligible Employee to a fixed amount which must not be less than the minimum amount permitted; any other method the Directors think is fair. 7.2 Insufficient Shares If, having scaled down as described in Rule 4.1, the number of Shares available is insufficient to enable Options to be granted to all Eligible Employees making valid applications, the Directors may either select by lot, or decide not to grant any Options. 5

7 8 Option Price 8.1 Setting the price The Directors will set the Option Price which must be: not manifestly less than 80 per cent of the Market Value of a Share either on the date on which invitations are sent out to eligible employees or on the date, (not later than the Date of Grant), specified in the invitation; and if the Shares are to be subscribed, not less than the nominal value of a Share. 8.2 Market Value Market Value on any particular day means: where Shares of the same class are admitted to the Official List of the UK Listing Authority and traded on the London Stock Exchange: (i) (ii) if the Directors decide, the average price for the 3 immediately preceding Business Days or their price for the immediately preceding Business Day. 9 Grant of Options 9.1 Time of grant The price is the middle market quotation taken from the Daily Official List of the London Stock Exchange. The Directors must grant an Option to each Eligible Employee who has submitted and not withdrawn a valid application. Subject to the scaling down provisions, the Option is to acquire, at the Option Price, the number of Shares for which the Eligible Employee has applied. The grant must be made within 30 days (or 42 days if applications are scaled down) of the first date by reference to which the Option Price was set. 9.2 Restrictions on grant If the Directors grant an Option to a person who is not an Eligible Employee on the Date of Grant, that Option is void If the Directors grant an Option in excess of the Plan limits in Rule 4 of the Principal Terms, it will take effect as an Option which would not exceed those limits Options must not be granted after the tenth anniversary of the adoption of the Plan. 9.3 Option certificates Options will be evidenced in such form as the Directors may specify. 9.4 No payment for Options Optionholders are not required to pay for the grant of any Option. 6

8 9.5 Disposal restrictions An Optionholder may not transfer, assign or otherwise dispose of an Option or any rights in respect of it. If an Optionholder tries to do so, whether voluntarily or involuntarily, the Option will immediately lapse. This does not apply to the transmission of an Option on the death of an Optionholder to his personal representatives. 9.6 Administrative errors If any Option is granted on terms which are not in accordance with the provisions in these Rules, including the limits on participation, it shall be limited and take effect from the Date of Grant as being granted within the provisions of these Rules. 9.7 Contributions Where any Contribution is paid in a currency other than sterling, and when converted into sterling is less or more than the intended Contribution, the excess or deficit may be held over and adjusted as appropriate. 10 Variations in share capital 10.1 Adjustment of Options If there is: a variation in the equity share capital of the Company, including a capitalisation or rights issue, sub-division, consolidation or reduction of share capital; or a demerger (in whatever form) or exempt distribution by virtue of Section 213 of the Income and Corporation Taxes Act 1988; or a special dividend or distribution, the Directors may adjust the number or class of Shares or securities comprised in an Option and/or the Option Price Notice The Company may notify Opionholders of any adjustment made under this rule Exercise and lapse - general rules 11.1 Exercise Except where exercise is permitted under Rule 12, an Option can only be exercised: during the period of six months after the End Date; and so long as the Optionholder is a director or employee of a Group Company Lapse An Option will lapse on the earliest of: the date the Optionholder ceases to be a director or employee of a Group Company, unless any of the provisions of Rule 12 apply; 7

9 the date on which the Optionholder stops paying Contributions or applies for repayment of all or any Contributions; the expiry of any period specified in Rule 12 (except 12.3: specified age); or six months after the End Date unless Rule 12.2 (death) applies. 12 Exercise and lapse - exceptions to the general rules 12.1 Cessation of employment An Optionholder may exercise his Option within 6 months after ceasing to be a director or employee of a Group Company for one of the following reasons: (i) (ii) (iii) (iv) injury, disability, redundancy or retirement on reaching the Specified Age or any other age at which he is bound to retire under the terms of his contract of employment; his office or employment ceasing to be in a Group Company; the business or part of a business in which he works being transferred to a company which is not in the Group; or retirement with the agreement of the Optionholder s employer If the Optionholder ceases to be a director or an employee of a Group Company more than three years after the Date of Grant for one of the following reasons he may exercise his Option within six months after cessation: (i) (ii) on grounds of resignation and for any other reason permitted by the Directors An Optionholder who ceases to be a director or employee of a Group Company and simultaneously becomes a director or employee of Rio Tinto Limited or a subsidiary of Rio Tinto Limited shall be deemed, for the purposes of this Rule 12.1, not to have ceased to be a director or employee of a Group Company, until such time as he ceases to be a director or employee of Rio Tinto Limited or a subsidiary of Rio Tinto Limited. This provision shall not apply to an Optionholder under the UK Plan To the extent that any Option exercisable under this Rule is not exercised within the period specified, it will lapse at the end of the period Death If an Optionholder dies, his Option may be exercised by his personal representatives within one year after: the date of his death, if death occurred before the End Date; or the End Date, if death occurred on or within six months after the End Date Specified Age If an Optionholder continues to be a director or employee of a Group Company after the date on which he reaches the Specified Age, he may exercise his Option within 6 months after reaching the Specified Age. 8

10 12.4 Takeovers If 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 Shares, Options may be exercised within the 6 month period after the person making the offer has obtained Control of the Company. If not exercised, the Options will lapse at the end of the 6 month period, unless the Directors give written notice to all the Optionholders before the end of the 6 month period that the Options will not lapse Section 979 notice If a person (or a group of persons acting in concert) becomes bound or entitled to acquire Shares by serving a notice under section 979 of the Companies Act 2006, Options may be exercised at any time when that person remains so bound or entitled, and lapse at the end of that time Company reconstructions If under section 899 of the Companies Act 2006 a court sanctions a compromise or arrangement in connection with the acquisition of Shares, Options may be exercised within the 6 month period after the date of the court sanction, unless the Acquiring Company makes an offer to exchange options in accordance with Rule 13 (Exchange of Options). Any options not exercised will lapse at the end of that period Winding-up If the Company passes a resolution for its voluntary winding-up, Options may be exercised within six months after the date of the resolution. However, the issue of Shares after such exercise has to be authorised by the liquidator or the court (if appropriate), and the Optionholder must apply for this authority and pay his application costs. Any Options not exercised during that period will lapse at the end of the period Priority If there is any conflict between any of the provisions in Rules11 and 12, the provision which results in the shortest exercise period will prevail. 13 Exchange of Options 13.1 Application This Rule applies to all Options (whether or not already exercisable) if any of the following occur: a general offer to obtain Control of the Company is or becomes or is declared wholly unconditional; a company obtains Control of the Company under a scheme of arrangement sanctioned by the court under Section 899 Companies Act 2006; or any person becomes entitled or bound to acquire Shares under Section 981 of the Companies Act

11 13.2 Agreement to exchange If this Rule 13 applies, the Optionholder may, with the agreement of the Acquiring Company, exchange his Options under Rule 13.3 during the appropriate period set out in paragraph 38(3) of Schedule 3 to ITEPA. For this purpose the Acquiring Company is the company which has obtained Control of the Company, or has become entitled and bound as mentioned in Rule Exchange Where an Option is to be exchanged the Optionholder will be granted a new option to replace it, on the following basis: the new option will be in respect of Shares which satisfy the conditions of paragraph 39 of Schedule 3 to ITEPA, in any company determined by the Directors which fall with paragraph 18(b) or (c) of Schedule 3 to ITEPA, or in the absence of any such determination, in the Acquiring Company the new option will be equivalent to the Option that was exchanged as provided in paragraph 39(4) of Schedule 3 to ITEPA; the new option will be treated as having been acquired at the same time as the Option that was exchanged and be exercisable in the same manner and at the same time; the new option will be subject to the Rules as they last had effect in relation to the Option that was exchanged; with effect from the exchange, the Rules will be construed in relation to the new option 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 any company determined by the Directors under Rule these Rules will in relation to the new option be construed as if references to the Company and to the Shares were references to the Acquiring Company, but references to the Group Company shall continue to be construed as if references to the Company were references to Rio Tinto plc Directors The determination made in Rule will be made by those people who were Directors immediately before the relevant event in Rule Exercise of Options 14.1 Limit on exercise Where an Option is exercisable early under Rule 12, it may only be exercised in respect of the number of Shares produced by applying the following formula: A x (B/C) Where: A = the number of Shares comprised in the Option. 10

12 B = the number of whole months between the start of the Savings Contract and the date the employee ceases employment under the relevant provision in Rule 12, subject to the limitation that B cannot exceed C. C = the duration of the Savings Contract (had it been completed) expressed in months. The remainder of the Option which cannot be exercised will lapse. A purported exercise to an extent greater than that provided above will be deemed to be an exercise only to the extent permitted Manner of exercise Options must be exercised by notice in writing or by in a form specified by the Company signed by the Optionholder or by his agent and delivered to the Company or its agent. The Optionholder must also send: if the Company so requires, the relevant option certificate; and either payment in full and evidence of the termination of the Savings Contract; or authority to terminate the Savings Contract and use a specified amount to acquire the number of Shares over which the Option is being exercised. The exercise of the Option is effective on the date of receipt by the Company or its agent of the notice, the option certificate (if required) and the relevant payment or authority Part exercise Options may be exercised in respect of all the Shares under the Option or some only of the Shares and the unexercised options will lapse Issue or transfer Subject to Rule 14.7 (Consents): Shares to be issued following the exercise of an Option must be issued within 30 days of the date of exercise; and If Shares are to be transferred following the exercise of an Option, the Directors must procure this transfer within 30 days of the date of exercise Rights Shares issued on exercise of an Option rank equally in all respects with the Shares in issue on the date of allotment. They do not rank for any rights attaching to Shares by reference to a record date preceding the date of allotment Where Sharesare to be transferred on the exercise of an Option, Optionholders are entitled to all rights attaching to the Shares by reference to a record date after the transfer date. They are not entitled to rights before that date Local restrictions Where there are any local legal restrictions on the Optionholder holding Shares, the Shares may, at the discretion of the Directors, be issued or transferred to a person determined by the Directors to be held on behalf of the Optionholder. 11

13 14.7 Consents All allotments, issues and transfers of Sharesare subject to any necessary consents under any relevant enactments or regulations for the time being in force in the United Kingdom or elsewhere. The Optionholder is responsible for complying with any requirements to obtain or avoid the need for any such consent Articles of Association Any Shares acquired on the exercise of Options are subject to the Articles of Association of the Company from time to time in force Listing If and so long as the Shares are listed on the Official List of the UK Listing Authority or of any other stock exchange where Shares are traded, the Company must apply for listing of any Shares issued pursuant to the Plan as soon as practicable after their allotment. 15 Share Appreciation Rights 15.1 Number of Share Appreciation Rights Each Eligible Employee s application will be for a Share Appreciation Right in respect of the largest whole number of Shares which could be acquired at the Option Price with the Notional Repayment Amount under the related Savings Contract Modification of application and proposals If there are applications for Share Appreciation Rights over more Shares than the maximum specified in the invitation, each application and proposal for a Savings Contract will be deemed to have been modified or withdrawn as described in Rule Exercise of Share Appreciation Rights 16.1 Limit on exercise The extent to which an Optionholder may exercise his Share Appreciation Right is determined by the amount repayable under his Savings Contract, including any interest. Contributions made after the date of exercise of the Option are not included. However, if the amount repaid at the End Date is less than the Notional Repayment Amount, the Optionholder may make up the shortfall from his own funds in order to exercise the Share Appreciation Right to the full extent permitted Manner of exercise Share Appreciation Rights must be exercised by notice in writing or by in a form specified by the Company signed by the Optionholder or by his agent and delivered to the Company or its agent. The Optionholder must also send; if the Company so requires, the relevant certificate or other evidence of the Option; and evidence of the termination of the Savings Contract. 12

14 For the avoidance of doubt, the Option Price shall not be payable. The exercise of the Option is effective on the date of receipt by the Company or its agent of the notice, the certificate (if required) Part exercise. The Share Appreciation Right may be exercised in whole or in part Cash alternative The Directors may in their discretion determine not to procure the transfer or issue of Shares in satisfaction of a Share Appreciation Right, but instead pay to him (subject to Rule 17.8 (Withholding)) a cash amount equal to the Gain. For the purposes of Rules 15 and 16: Gain in relation to a Share Appreciation Right, means the amount by which the market value of a Share on the date of exercise of the Share Appreciation Right exceeds the Option Price, multiplied by the number of Shares subject to the Share Appreciation Right; Option means Share Appreciation Right, and Optionholder shall be construed accordingly; Share Appreciation Right means the right to receive a number of Shares of a value equal to the Gain, or an equivalent amount in cash; 17 General 17.1 Notices Any notice or other document which has to be given to an Eligible Employee or Optionholder under or in connection with the Plan may be: (i) (ii) delivered or sent by post to him at his home address according to the records of his employing company; or sent by or fax to any address or fax number which, according to the records of his employing company, is used by him; or in either case such other address which the Company considers appropriate Any notice or other document which 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 it at its respective registered office (or such other place as the Directors or the duly appointed agent may from time to time decide and notify to Optionholders) or sent by or fax to any address or fax number notified to the sender Subject to evidence to the contrary, notices sent by or to an Optionholder by post (whether in or from the UK or overseas), or fax, will be deemed to have been given on the fifth day after the date the notice was sent Documents sent to shareholders The Company may send to Optionholders copies of any documents or notices normally sent to the holders of its Shares. 13

15 17.3 Directors decisions final and binding 17.4 Costs The decision of the Directors on the interpretation of the Rules or in any dispute relating to an Option or matter relating to the Plan is conclusive. The Company will pay the costs of introducing and administering the Plan. The Company may require each Group Company to reimburse the Company for any costs incurred in connection with the grant of Options to, or exercise of Options by, employees of that Group Company Administration The Directors have the power from time to time to make or vary regulations for the administration and operation of the Plan Terms of employment For the purposes of this rule, Employee means any employee of a Group Company This rule applies during an Employee s employment and after the termination of an Employee s employment, whether or not the termination is lawful Nothing in the Plan rules or the operation of the Plan forms part of the contract of employment of an Employee. The rights and obligations arising from the employment relationship between the Employee and the Company 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 No employee has 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 The terms of the Plan do not entitle the Employee to the exercise of any discretion relating to a subsisting Option in his favour The Employee will have no claim or right of action in respect of any decision, omission or discretion, which may operate to the disadvantage of the Employee even if it is unreasonable, 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 his employer No Employee has any right to compensation for any loss in relation to the Plan, including any loss in relation to: (i) (ii) (iii) any loss or reduction of rights or expectations under the Plan in any circumstances (including lawful or unlawful termination of employment); any exercise of a discretion or a decision taken in relation to an Award or to the Plan, or any failure to exercise a discretion or take a decision; or the operation, suspension, termination or amendment of the Plan. 14

16 Participation in the Plan is permitted only on the basis that the Optionholder accepts all the provisions of the rules, including this rule 17.6 (Terms of employment). By participating in the Plan, an Employee waives all rights under the Plan, other than the right to acquire Shares subject to and in accordance with the express terms of the Plan and the Vesting Condition, in consideration for, and as a condition of, the grant of an Award under the Plan Nothing in this Plan confers any benefit, right or expectation on a person who is not an Employee. No such third party has any rights under the Contracts (Rights of Third Parties) Act 1999 to enforce any term of this Plan. This does not affect any other right or remedy of a third party which may exist Employee trust The Company and any Subsidiary of the Company may provide money to the trustee of any trust or any other person to enable them or him to acquire Shares to be held for the purposes of the Plan, or enter into any guarantee or indemnity for those purposes, to the extent permitted by Section 682 of the Companies Act Withholding Unless the Optionholder discharges the liability himself, the Company, any employing company or the trustee of any employee benefit trust may withhold any amount and make any arrangements as it considers necessary to meet any liability of the Optionholder to taxation or social security contributions in respect of Options. These arrangements include the sale of any Shares on behalf of an Optionholder Data protection By participating in the Plan the Optionholder consents to the holding and processing of personal data provided by the Optionholder to any Group Company, trustee or third party service provider, for all purposes relating to the operation of the Plan. These include, but are not limited to: administering and maintaining Optionholder records; providing information to Group Companies, Rio Tinto Limited and its subsidiaries, trustees of any employee benefit trust, registrars, brokers or third party administrators of the Plan; providing information to future purchasers of the Company or the business in which the Optionholder works; and transferring information about the Optionholder to a country or territory outside the European Economic Area that may not provide the same statutory protection for the information as the Optionholder s home country. 18 Changing the Plan and termination 18.1 Directors powers Except as described in the rest of this Rule, the Directors may at any time change the Plan in any way. 15

17 18.2 Shareholders approval Except as described in Rule 18.3, the Company in general meeting must approve in advance by resolution any proposed change to the advantage of present or future Optionholders which relate to the following: the persons to whom or for whom Shares may be provided under the Plan; the limitations on the number of Shares which may be issued under the Plan; the maximum Contribution which may be made under the Plan; the determination of the Option Price; any rights attaching to the Options and the Shares; the rights of Optionholders in the event of a capitalisation issue, rights issue, subdivision or consolidation of Shares or reduction or any other variation of capital of the Company; the terms of this Rule Minor changes The Directors need not obtain the approval of the Company in general meeting for any minor changes: to benefit the administration of the Plan; to comply with or take account of the provisions of any proposed or existing legislation; to take account of any changes to relevant legislation or regulation other than those which materially effects either the terms of the Plan or the operation of the Plan; or to obtain or maintain favourable tax, exchange control or regulatory treatment of the Company, any subsidiary or any present or future Optionholder Additional Parts For the avoidance of doubt, the Directors need not obtain the approval of shareholders for the adoption of additional Parts under Rule Termination of the Plan The Plan will terminate on the Expiry Date, but the Directors may terminate the Plan at any time before that date. However, Options granted before such termination will continue to be valid and exercisable as described in these Rules. 19 Governing law English law governs the Plan and all Options and their construction. The English Courts have non-exclusive jurisdiction in respect of disputes arising under or in connection with the Plan or any Option. 16

18 UK Plan The rules of the UK Plan consist of the Principal Terms, amended as specified below. 1 Definitions End Date means the date on which the bonus becomes payable under the terms of the relevant Savings Contract; Eligible Employee means any person who satisfies the additional condition that he has earnings in respect of his office or employment which are general earnings (or would be if there were any) as described in paragraphs 6(2)(c) and 6(2)(ca) of Schedule 3 to ITEPA. However, the definition of Eligible Employee does not include anyone who is excluded from participation because of paragraph 11 of Schedule 3 to ITEPA (Material interest provisions); Notional Repayment - this term will be disapplied for the purposes of the UK Plan; Participating Company means: (i) (ii) the Company; and any Subsidiary and any other company which is permitted by HMRC to participate in the Plan and which in both cases is designated by the Directors as a Participating Company; all references to Group Company under the Principal Terms shall be construed accordingly for the purposes of the UK Plan. Savings Contract means a contract under a certified SAYE savings arrangement within the meaning of paragraph 24(1) of Schedule 3 to ITEPA; Shares means fully paid ordinary shares in the capital for the time being of the Company which satisfy paragraphs 18 to 22 of Schedule 3 to ITEPA. Subsidiary means a company which is: (i) (ii) a subsidiary of the Company within the meaning of Section 1159 of the Companies Act 2006; and under the Control of the Company. 2 Invitations 2.1 Invitations When the Directors operate the Plan they must send invitations to all Eligible Employees on similar terms. 2.2 Time when invitations may be made In addition to the times specified in the Principal Terms, invitations may be made within 42 days of the day on which the Plan is formally approved by HMRC and invitations will not be sent until prior HMRC approval to the Plan is obtained. 2.3 Form of invitation All applications for UK Eligible Employees must be made on similar terms. 17

19 2.3.2 The date by which applications must be received must be at least 14 days after the date of the invitation unless otherwise agreed in advance with HMRC The maximum permitted Contribution may not be more than the maximum specified in ITEPA There shall be no reference to a Notional Repayment Amount for the purposes of the UK Plan. 3 Application 3.1 Form of Application If a choice is offered, the Eligible Employee may state whether he wishes to defer receipt of his bonus at the end of the savings period in order to receive an increased bonus. 3.2 Number of Shares Each Eligible Employee s application will be for an Option over the largest whole number of Shares which he can acquire at the Option Price with the expected repayment under the related Savings Contract. 3.3 Scaling down The Directors may only use other methods if they agree them in advance with HMRC. 4 Option Price Where Rule of the Principal Terms do not apply, where Shares are not so listed, the Market Value of a Share is calculated as described in Part VIII of the Taxation of Chargeable Gains Act 1992 and agreed in advance with HMRC Shares and Assets Valuation. 5 Administrative errors and Contributions Rules 9.6 and 9.7 of the Principal Terms shall not apply. 6 Variations in share capital No adjustment may be made to Options under rule 10 without the prior approval of HMRC and the Directors may not make an adjustment in the circumstances described in rules or or to the class of securities subject to an Option. 7 Exercise and lapse - general rules 7.1 Exercise An Option can also only be exercised so long as the Optionholder is a director or employee of a Participating Company. For the purpose of the UK Plan an Optionholder is not treated as ceasing to be a director or employee of a Participating Company until he has ceased to be a director or employee of the Company, any associated company (as defined in paragraph 47(1) of Schedule 3 to ITEPA), and any company under the Control of the Company. 7.2 Material interest An Optionholder cannot exercise an Option if he is (or was at the date of his death), ineligible to participate in the Plan because of paragraph 11 of Schedule 3 to ITEPA (Material interest provisions). 18

20 7.3 Lapse An Option will also lapse, if earlier than the dates specified in the Principal Terms, on: the date on which the Optionholder is deemed to give notice under the Savings Contract that he intends to stop paying contributions under his Savings Contract; the date on which the Optionholder stops paying contributions under his Savings Contract, unless any of the provisions of Rule 12 of the Principal Terms apply. 8 Exercise and lapse - exceptions to the general rules 8.1 Cessation of employment An Optionholder may only exercise his Option in the manner specified in Rules 11.1, 11.2 and 12.1 of the Principal Terms if he ceases to be a director or employee of a Participating Company (rather than a Group Company), as determined under Rule Paragraphs (iv) and (v) of Rule of the Principal Terms will not apply to the UK Plan For the purposes of the UK Plan, the following 2 paragraphs are added to Rule of the Principal Terms: (i) (ii) early retirement with the agreement of the employer; resigning while pregnant or failing to return to work following maternity leave. 8.2 Employment with an Associated Company If an Optionholder ceases to be a director or employee of a Participating Company but, on the End Date, is an employee or director of an Associated Company or a company of which the Company has Control, he may exercise his Option within six months of that date. 9 Exercise of Options 9.1 Limit on exercise An Optionholder may exercise his Option using funds equal to or less than the amount repayable under his Savings Contract, including any bonus or interest. Contributions made after the date of exercise of the Option may not be used. For the avoidance of doubt, the Optionholder may not make up any shortfall from his own funds. 10 Share Appreciation Right Rules 15 and 16 of the Principal Terms shall not apply. 11 Changing the Plan 11.1 HMRC approval If the approved status of the Plan is to be maintained, any change to a key feature of the Rules after they have been approved under Schedule 3 to ITEPA will take effect from the later of: the date that the change is approved by HMRC; and the date the Directors resolve to approve the amendment. 19

21 The Company will notify HMRC as soon as it becomes aware that the approval status of the Plan will be affected. 12 Limit on exercise Rule 14.1 of the Principal Terms shall not apply. 20

22 French Plan The Rules of the French Plan consist of the Principal Terms, amended as specified below. 1 Definitions Eligible Employee means any person who, in addition, does not own more than 10% of the issued share capital of the Company; Participating Company means, in addition, a subsidiary of which at least 10% of the share capital is held, directly or indirectly, by the Company, or companies holding at least, directly or indirectly, 10% of the share capital of the Company; 2 Plan Limits The number of Shares which may be allocated under the Plan when added to the number of Shares which may be allocated under any other employee share scheme operated by the Company, must not exceed one third of the share capital of the Company from time to time. 3 Option Price The option Price must be not less than 80% of the average market quotation per Share as derived from the Official List of the London Stock Exchange for the 20 Business Days immediately preceding the Date of Grant. 4 Grant of Options No Option shall be granted less than 20 Business Days after either a dividend record date or a date on which the Shares become ex-rights in relation to an increase in capital. No option shall be granted, within 10 Business Days before or after both the preliminary announcement and the release of the report and accounts, and/or before the release of any information which will have an impact on the share price of the Company or within 10 Business Days after release of such information. 5 Restrictions on Grant Options must not be granted after 38 months as from the adoption of the Plan. 6 Limit on Contributions Contributions may not exceed the maximum permitted under French labour law. 7 Exercise of Options on death If an Optionholder dies, his Options may be exercised by his personal representatives within one year after his death. 8 Adjustment of Options The Option Price after any such event shall, as the case may be, be reduced or increased in the same proportion as the value of the Shares of the Company is reduced or increased by reason of the event. The number of Shares in respect of which Options may be exercised shall be adjusted such that the aggregate Option Price remains the same, such number being rounded up to the nearest whole number, if necessary. 21

23 Adjustments pursuant to this Rule must also be made in respect of Options which have been exercised but, where no Shares have yet been issued or transferred to the Option Holder pursuant to such exercise. The Option Price of an Option to subscribe for Shares shall not be adjusted below the nominal value of a Share. 9 Share Appreciation Rights Rules 15 and 16 of the Principal Terms shall not apply. 10 Changing the Plan and Termination The Option Price shall not be amended. 11 Exercise and Lapse - General rules Rule 11.3 of the Principal Terms shall not apply. 12 General - Data Protection In addition, by participating in the Plan, the Optionholder consents to the transfer of personal data as set out in Rule 17.9 and within the filing made by Rio Tinto with the Commission Nationale de l informatique et des Libertes (CNIL). Pursuant to the Law of 6 January 1978, the Optionholder will have the right to request communication of his personal data and to request a modification of this information. 22

24 US Plan The Rules of the US Plan consist of the Principal Terms, amended as specified below. 1 Definitions Eligible Employee means US Qualifying Employee. Option Period means the period of 27 months which starts on the Date of Grant. US Qualifying Employee means any person who is employed by a Group Company organised in the United States and who on the relevant Date of Grant: (i) (ii) has been employed by the Group Company for at least 6 months or such other period as the Directors determine (not exceeding two years); and is customarily employed for more than 20 hours per week (or such shorter number of hours as the Directors determine). 2 Operation of the US Plan The Company intends that the US Plan constitute a separate employee share purchase plan which satisfies the requirements of Section 423 of the United States Internal Revenue Code of 1986, as amended (the Code ). If any provision of the US Plan conflicts with the Principal Terms, the provision in the US Plan will prevail. The US Plan must be administered in a manner that gives all Optionholders the same rights and privileges to the extent required under Section 423(b)(5) of the Code and the related regulations. 3 Option Price 4 Limits The Option Price must not be less than 85% of the average of the Market Values on the three Business Days immediately preceding the Date of Grant or such other date determined by the Directors. 4.1 US Plan Limit Subject to Rule 10 of the Principal Terms, the number of Shares over which options may be granted under the US Plan will not exceed 100,000,000 Shares which represents approximately 10% of the issued share capital of the Company at 30 June % Owners No US Qualifying Employee may be granted an Option under the US Plan if such US Qualifying Employee, immediately after the grant of the Option, owns Shares possessing 5% or more of the total combined voting power or value of all classes of Shares of the Company or any parent or subsidiary corporation (within the meaning of Section 424 of the Code). 4.3 $25,000 Limit No US Qualifying Employee may be granted an Option which would permit the US Qualifying Employee rights to purchase Shares, under all plans of the Company and any parent or subsidiary corporation (within the meaning of Section 424 of the Code) which are intended to satisfy Section 423 of the Code, to accrue at a rate which exceeds $25,000 of 23

25 the fair market value of the Shares (determined at the time the option is granted) for each calendar year in which the Option is outstanding at any time. For this purpose, the right to purchase Shares accrues when the Option (or any portion thereof) becomes first exercisable during the calendar year. 5 Exercise and Lapse - General Rules No Option may be exercised later than the expiry of the Option Period. To the extent not exercised, the Option will lapse on the expiry of the Option Period. 6 Exercise and Lapse - Exceptions to the General Rules When an Option is exercisable following termination of employment with a Group Company, or on death, it may only be exercised in the period of three months following the date of termination or death. 7 Share Appreciation Rights Rules 15 and 16 of the Principal Terms shall not apply. 8 Shareholders approval The US Plan must be approved by the shareholders within 12 months before or after the date on which the US Plan is adopted. 24