Shareholders Agreement, dated July 2, 2018, among Hermes Fund Managers Limited, BT Pension Scheme Trustees Limited, in its capacity as trustee for and on behalf of the BT Pension Scheme, Federated Holdings (UK) II Limited, and Federated Investors, Inc

Signatories    48

BETWEEN:

BACKGROUND:

IT IS AGREED as follows:

The parties acknowledge and agree that the primary objectives of the Group are:

The parties anticipate that the Business will evolve and will discuss in good faith further opportunities to develop the Business.

of such Federated Distribution Agreements or Hermes Distribution Agreements not in the ordinary course of business and on arm's length terms, shall be subject to Shareholder Approval.

The management and control of the Company must be exercised in the United Kingdom and the Shareholders must use all reasonable endeavours to ensure that the Company is treated for all purposes, including taxation, as resident in the United Kingdom.

The Group shall operate under the 'Hermes' brand unless otherwise approved by the Shareholders under clause 6.3, provided that the Board may change such branding without approval from Shareholders: (a) to incorporate the name 'Federated' into such branding; and (b) in respect of products and/or services offered or sold by the Group in the United States or its territories.

This agreement takes effect at the time and on the date at which the sale of Shares to Federated is completed under the SPA (the Effective Date).

The parties agree that on the Effective Date the Constitution shall be adopted as the articles of association of the Company in substitution for all prior articles of association.

Each Shareholder must exercise all powers and rights available to that Shareholder as a holder of Shares in order to give effect to the provisions of this agreement and to ensure that the Company complies with its obligations under this agreement. References in this agreement to the Shareholders procuring that the Company performs its obligations are to be interpreted accordingly.

Each Shareholder agrees that if any provision of the Constitution at any time conflicts or is inconsistent with the provisions of this agreement: (i) the provisions of this agreement are to prevail to the extent of the conflict or inconsistency, (ii) the Constitution will be taken to be read and interpreted accordingly, and (iii) the Constitution must be amended to the extent necessary in accordance with clause 4.4.

Each Shareholder must exercise all powers and rights available to that Shareholder to procure the amendment of the Constitution to the extent necessary to give effect to the provisions of this agreement.

The Company is not required to comply with any obligation contained in this agreement to the extent that to do so would constitute an unlawful fetter on the Company's statutory powers. This does not

affect the validity of the relevant provisions as between the other parties or the respective obligations of the other parties under this clause 4.

and no Shareholder may exercise any vote or other power to remove a Director appointed by another Shareholder.

With effect from the Effective Date, the Board shall comprise the Directors set out in the first column of the table below, and, where relevant, as a Nominated Director for the Appointer set out in the second column in the table below opposite that Director's name:

To appoint or remove a Nominated Director under this agreement, a Shareholder must give written notice to the Company specifying the identity of the person it wishes to appoint or remove. The notice must in the case of an appointment, be accompanied by a signed written consent from that person agreeing to act as a Director.

The Federated Parties are entitled to appoint and remove one of the Independent Directors as the chairman of the Board. The initial chairman with effect from the Effective Date shall be David Stewart.

A Director may by notice to the Company:

The board of directors of each Subsidiary of the Company shall comprise such persons as are approved by the Board from time to time.

Meetings of the Board must be held and conducted in accordance with the provisions of Schedule 2.

The policies adopted from time to time by the Risk and Compliance Committee of the Board shall apply to all Group Companies, and the Company shall use its powers in relation to the other Group Companies to ensure that they comply with such policies.

Shareholder meetings must be held and conducted in accordance with the provisions of Schedule 3.

The Board shall:

The Company must ensure that, and each Shareholder undertakes to exercise all its powers as a Shareholder or otherwise so as to procure that, for so long as both Federated (or its Permitted Transferee or successors or assignees) and BTPS (or its Permitted Transferee or successors or assignees) continue to hold Shares, no Group Company does any of the things listed in Schedule 4 (or anything which is analogous or has a substantially similar effect to any of those things) without the prior written approval of both Federated and BTPS. The approval required by this clause 6.3 is in addition to any resolution required by statute or under the general law.

Any approval required to be given under clause 6.3 by a Shareholder that is a corporation may be given on behalf of that Shareholder by:

in each case stating that the notice or vote, as the case may be, constitutes the approval of that Shareholder for the purposes of clause 6.3 of this agreement.

If a Shareholder has an Interest in a matter that would otherwise require approval of that Shareholder under clause 6.3 and that Shareholder is precluded from voting on that matter in accordance with clause 7.2, then approval of that Shareholder is not required for the purposes of clause 6.3.

Subject to clause 7.2, clause 7.3 and clause 7.4, if a Director has an Interest in any matter which conflicts or may conflict with the interests of the Company and which is to be considered or voted upon at a Board meeting or which is to be subject of a written resolution of the Directors:

A Shareholder or Director who has an Interest in any matter is not entitled to exercise any right or power to prevent any Group Company from enforcing its rights or defending any claim in relation to that matter.

Without prejudice to clause 7.2, if any matter to be considered or voted upon at a Board meeting relates to:

then that matter must be considered at a separate meeting or meetings of the Board (notice of which must be given to each Director), and all the Directors appointed by the relevant Shareholder:

The quorum for any such meeting is three Directors who are entitled to vote on the matter.

The Budget in the Agreed Form for the Financial Year ending 31 December 2018 is the Initial Budget. The Federated Parties and BTPS acknowledge and agree that the Initial Budget and subsequent Budgets are and will be projections, and that the Board and Company management will have flexibility in good faith to adjust the Budgets from time to time as they determine facts, circumstances or business need warrant, subject always to the approval of the Board and to the terms of this agreement (including any consent or approval rights granted to the Shareholders under this agreement).

The Company must:

The Company must promptly provide to each Shareholder the information and assistance set out in Part 2 of Schedule 5.

Nothing in clause 9.3 requires the Company to give any person access to information if to do so would, in the reasonable opinion of the Board:

So far as legally permissible, a Nominated Director is entitled to pass such information concerning any Group Company to his Appointer or any of his Appointer's Affiliates or Associated Persons as may be reasonably requested or the relevant Director may consider appropriate from time to time, so long as each recipient keeps that information confidential in accordance with clause 19.

The Company must take all reasonable steps to obtain, and must comply with the terms of, all regulatory licences, binding codes of conduct, permissions and consents necessary for the conduct of its business and must procure that each other Group Company does likewise.

The Company must comply, and must procure that each Group Company complies, with the Anti-Corruption Policies and must review them at least annually.

position economically and as regards voting rights as if the issue had taken place at fair value in accordance with clause 11.3.

The Company must not issue any Securities unless the issue:

The Company shall, on the Effective Date, adopt the “New LTIP” in the Agreed Form as described in the SPA. The Board may after the Effective Date resolve (with and subject to the approval of Shareholders) that the Company adopt further employee share schemes or long term incentive plans in order to incentivise employees. Shareholders' pre-emption rights in relation to an issue of Securities carried out in accordance with any such scheme or plan shall be, and are hereby, irrevocably waived by the Shareholders and each Shareholder shall exercise all its rights as Shareholder (as necessary) to implement any such arrangement.

Subject to clause 12.5, if the Company proposes to issue any Shares including in accordance with clauses 11.2, 11.4 and 11.5, it must first give written notice to each Shareholder (an Offer Notice) as soon as reasonably practicable (if applicable) after Shareholder Approval for that issue is given, inviting the Shareholder to subscribe for those Shares. An Offer Notice must:

Within one Business Day after the end of the Offer Period, the Company must give notice to each Subscribing Shareholder, specifying:

On the Offer Closing Date:

The provisions of clauses 12.1 to 12.4 shall not apply to any issue of Shares:

Each Shareholder:

Except for a Disposal:

no Shareholder may Dispose of any Shares unless and until the last period for the exercise of a “Put Option” or a “Call Option” under the Put and Call Option Deed has expired and no such option has been exercised.

Subject to clauses 13.4 and 14, a Shareholder may transfer its Shares:

If a Shareholder holding Shares transferred to it under clause 13.3(a) is about to cease to be a Permitted Transferee of the transferor that transferred those Shares to that Shareholder, it must immediately transfer all of its Shares back to that transferor or to another Permitted Transferee of that transferor.

The Company must not issue any Shares or register the transfer of any Shares unless:

If a person becomes a holder of Shares, other than as a result of breach of this agreement, and the provisions of clause 14.1 are complied with, each party:

Each Share certificate issued by the Company must include a statement that:

"Transfer and disposal of shares in the Company are subject to the restrictions contained in the Shareholders' Agreement relating to the Company dated 2 July 2018 and the constitution of the Company."

Unless Federated and BTPS otherwise agree in writing, neither Federated nor BTPS nor their Affiliates shall, at any time during the period commencing on the Effective Date and ending on the date two years

after the date Federated (or its Permitted Transferee or successors or assignees) or BTPS (or its Permitted Transferee or successors or assignees) (as appropriate) ceases to hold any Shares, solicit, hire, employ, accept secondment or redeployment of:

provided that nothing in this clause 15.1 shall prevent either Shareholder or its Affiliates, after that Shareholder has ceased to be a Shareholder, from employing or accepting secondment or redeployment of any such employee who approaches that Shareholder or Affiliate seeking employment on his or her own initiative (without having been solicited to do so) or who responds to a bona fide general advertisement issued by that Shareholder or Affiliate.

Each Shareholder acknowledges that:

Each party warrants to each other party on the date of this agreement that each of the following statements is true and accurate:

Each party undertakes to each other party that:

This agreement takes effect on the Effective Date and continues until terminated in accordance with clause 18.2.

This agreement terminates:

If this agreement terminates in respect of the rights and obligations of any party:

Except as permitted by this clause 19:

and must not disclose or cause or permit the disclosure to any person of any such information, or use any such information for any purpose other than exercising or enforcing its rights or performing its obligations under this agreement or monitoring and making decisions regarding its investment in the Company; and

and must not disclose or cause or permit the disclosure to any person of any such information, or use any such information for any purpose other than conducting the Business or exercising its rights or performing its obligations under this agreement.

Clause 19.1 does not apply to any information which:

Nothing in clause 19.1 prevents any party from disclosing information to any of its Affiliates or Representatives if:

A party that discloses information under this clause 19.3 must ensure that each of its Affiliates or Representatives to whom information is so disclosed strictly complies with that party's obligations under this clause 19 as if those obligations were imposed directly on the relevant Affiliate or Representative.

Nothing in clause 19.1 prevents a party or any of its Affiliates or Representatives from disclosing information if disclosure is required by law, rule or regulation (except to the extent the requirement can be excluded or limited by contract or by a confidentiality obligation), any tribunal or court of competent jurisdiction, any Government Agency or the listing rules of any recognised securities exchange. Before any disclosure is made under this clause 19.4, the party that is, or whose Affiliate or Representative is, required to make disclosure must, to the extent permitted by law and the relevant disclosure requirement:

For the purposes of this clause 19.4, where the information required to be disclosed is the existence, terms or subject matter of, or the negotiations relating to, this agreement, references to the Discloser are taken to be references to each other party.

Nothing in clause 19.1 prevents a party from disclosing information to the extent required to enable that party to enforce the provisions of this agreement or for the purpose of defending any proceedings brought against that party.

Unless the Shareholders otherwise expressly agree in writing, the Shareholders must procure that all of the Company's trading losses and all other amounts eligible for relief for taxation are carried forward by the Company and not surrendered (wholly or partly) to the Shareholders.

Any notice or other communication to be given under this agreement must be in writing (which includes email) and may be delivered by hand or sent by post or email to the party to be served as follows:

Address:    Sixth Floor, 150 Cheapside, London, England, EC2V 6ET

Email:     ***@***

For the attention of:    Head of legal;

Address:    One America Square, 17 Crosswall, London, England, EC3N 2LB

Email:     ***@***

For the attention of:    Head of legal; and

Address:    Federated Investors Tower, 1001 Liberty Avenue, Pittsburgh, Pennsylvania, USA ###-###-####

Email:     ***@***

For the attention of:    General Counsel with a reference to Project Conduit,

or at any such other address or email address notified for this purpose to the other parties under this clause 21. Any notice or other communication sent by post must be sent by prepaid ordinary post (if the country of destination is the same as the country of origin) or by airmail (if the country of destination is not the same as the country of origin).

Any notice or other communication is deemed to have been given:

but if the notice or other communication would otherwise be taken to be received after 5.00 pm or on a Saturday, Sunday or public holiday in the place of receipt then the notice or communication is taken to be received at 9.00 am (local time at the place of receipt) on the next day that is not a Saturday, Sunday or public holiday in the place of receipt.

In proving service of a notice or other communication, it is sufficient to prove that delivery was made or that the envelope containing the communication was properly addressed and posted either by prepaid post or by prepaid airmail or that the email was properly addressed and transmitted by the sender's server into the network and there was no apparent error in the operation of the sender's email system (as the case may be).

This clause 21 does not apply in relation to the service of any claim form, notice, order, judgment or other document relating to or in connection with any proceedings, suit or action arising out of or in connection with this agreement.

Unless otherwise expressly stated (or as otherwise agreed in the case of a given payment), each payment to be made under this agreement must be made in cash in pounds sterling by transfer of the relevant amount into the relevant account on the date (and, if applicable, at or before the time) the payment is due for value on that date and in immediately available funds. The relevant account for a given payment is such account as the receiving party may, not less than three Business Days before the date that payment is due, specify by giving notice to the relevant paying party or parties for the purpose of that payment. With respect to any payment or contribution obligation, Federated shall pay or contribute, and FII shall procure that Federated shall pay or contribute, the amounts payable or to be contributed when due, and each of the Federated Parties shall have a direct obligation to pay or contribute the sum due, but payment or contribution by either Federated Party of the full sum due will satisfy the obligations of both Federated Parties to make such payment or contribution.

This agreement may only be amended in writing and where the amendment is signed by all the parties.

Permitted Transferee which is made on condition that the relevant rights or obligations be reassigned or transferred to that Shareholder (or another Permitted Transferee of that Shareholder) if the transferee ceases to be a Permitted Transferee of the transferor, and (ii) FII may freely assign this agreement in connection with a sale of all or substantially all of its assets, a merger or consolidation transaction of FII, so long as the buyer or surviving entity agrees in writing to be bound by this agreement. If an assignment takes place pursuant to this clause 23.2, the other parties shall be under no greater liability under this agreement than if the assignment had not taken place and, as between BTPS and the Federated Parties, the parties may nevertheless enforce this agreement against the other parties as if the assignment had not occurred. For the avoidance of doubt, nothing in this clause 23.2 shall require any consent or approval to be given by BTPS or the Company to any change in control (whether by stock sale, asset sale, merger or otherwise) of FII.

Except as otherwise expressly provided in this agreement, a party may give or withhold its consent to, or approval of, any matter referred to in this agreement in its absolute discretion. A party that gives its consent to, or approval of, any matter referred to in this agreement is not taken to have made any warranty or representation as to any matter or circumstance connected with the subject matter of that consent or approval.

Except as otherwise expressly provided in this agreement, each party must pay the costs and expenses incurred by it in connection with entering into and performing its obligations under this agreement.

This agreement and the Put and Call Option Deed contain the entire agreement between the parties relating to the transactions contemplated by this agreement and supersede all previous agreements, whether oral or in writing, between the parties relating to these transactions. Except as required by statute, no terms must be implied (whether by custom, usage or otherwise) into this agreement. In entering into this agreement, none of the parties has relied on any representation, statement or promise not expressly set out herein, and each party waives any rights in respect of any such representation, statement or promise which may have been made, provided that this clause 23.5 shall not affect any right or remedy in respect of fraud or fraudulent misrepresentation.

This agreement may be executed in any number of counterparts and any party may enter into this agreement by executing and delivering a counterpart. Each counterpart constitutes the agreement of the party who has executed and delivered that counterpart. Faxed or scanned signatures are taken to be valid and binding to the same extent as original signatures.

The rights of each party under this agreement:

and delay in exercising or non-exercise of any such right is not a waiver of that right.

Nothing in this agreement or the Constitution will be deemed to constitute a partnership between the parties or, unless this agreement expressly provides otherwise, constitute any party the agent of any other party for any purpose.

BTPS is entering into this agreement solely in its capacity as trustee of the Scheme and all rights and obligations under this agreement and the Transaction Documents shall be held on trust by BTPS for the Scheme and BTPS shall have no liability under this agreement or the Transaction Documents except to the extent those liabilities are met from assets of the Scheme.

Any person appointed as custodian of the Scheme may exercise or perform all rights and obligations of BTPS under this agreement and any such exercise or performance shall be deemed to be that of BTPS. For these purposes Britel Fund Trustees Limited, a company incorporated in England with number 1687153, is a custodian of the Scheme.

The provisions contained in each clause are enforceable independently of each other clause and the validity and enforceability of any clause will not be affected by the invalidity or unenforceability of any other clause.

A person who is not a party to this agreement may not enforce any of its terms under the Contracts (Rights of Third Parties) Act 1999.

Without prejudice to clause 22, the obligations of the Federated Parties under this agreement shall be several not joint or joint and several, and shall be considered direct obligations of each Federated Party, enforceable fully and directly against each Federated Party without the need to join the other Federated Party or to pursue remedies first against the other Federated Party.

Each of FII and BTPS undertakes that where any obligation in this agreement is expressed to apply to any Affiliate of FII (including Federated) or BTPS (as the case may be), it will procure that such entity complies with such obligations as if it had been a party to this agreement.

This agreement and any non-contractual obligations arising out of or in connection with it are governed by English law.

The English courts have exclusive jurisdiction to settle any dispute, claim or controversy arising out of or in connection with this agreement (including a dispute, claim or controversy relating to any non-contractual obligations arising out of or in connection with this agreement) and the parties submit to the exclusive jurisdiction of the English courts.

For the purposes of clause 24.2, each party waives any objection to the English courts on the grounds that they are an inconvenient or inappropriate forum to settle any Dispute.

Without prejudice to any other method of service permitted by law, FII irrevocably appoints Federated Investors (UK) LLP of 5th floor, One New Change, London EC4M 9AF (marked for the attention of General Counsel) as its agent in England for service of process in relation to any Dispute.

If any person appointed as process agent under clause 24.4 is unable for any reason to so act, FII must immediately (and in any event within ten Business Days of the event taking place) appoint another agent on terms acceptable to BTPS.

Each party agrees that failure by a process agent to notify it of any process will not invalidate the relevant proceedings.

This clause 24 does not affect any other method of service allowed by law.

IN WITNESS of which this agreement has been executed as a deed and has been delivered on the date stated at the beginning of this agreement.

The Board must meet as necessary to discharge its duties but in any case no less frequently than quarterly. Any Director may call a meeting of the Board.

Except in the case of an emergency (in which case the notice convening the meeting must indicate the nature of, and the reasons for, the emergency), at least five Business Days' written notice of each meeting of the Board must be given to each Director by the chairman, the secretary or any Director.

Each meeting of the Board must be held in the United Kingdom at the place set out in the notice of meeting. One meeting per year may be held outside the United Kingdom if agreed by a Federated Director and the BTPS Director.

even if all the Directors are not physically present in the same place.

All resolutions proposed at meetings of the Directors or proposed by way of Directors' written resolutions must be decided by a simple majority of votes cast, calculated in accordance with and subject to paragraph 7 above.

The Directors may vote on a resolution without a meeting of the Directors being held if all the Directors entitled to vote on the resolution sign or indicate their approval of, a document containing a statement that they are in favour of the resolution set out in the document. The document may be in counterparts, signed or approved by one or more Directors, and may be circulated by fax or email.

Subject to any relevant statute or the general law, the Board may call a meeting of the Shareholders at a time and place the Board resolves.

The voting rights of the Shareholders are as follows:

A Shareholder resolution may only be carried:

Subject to clause 6.3, the Shareholders may pass a resolution without a meeting of the Shareholders being held if all the Shareholders entitled to vote on the resolution sign, or indicate their approval of, a document stating that they are in favour of the resolution set out in the document. The document may be in counterparts, signed or approved by one or more Shareholders, and may be circulated by email.

THIS DEED is made on l

BY: l of l (the New Party).

IN FAVOUR OF: Those persons specified in paragraph 4 of this deed.

BACKGROUND:

THIS DEED WITNESSES as follows:

IN WITNESS of which this deed has been executed and has been delivered on the date which appears first on page 1.

ESG Principles means the Responsible Investment Principles applied by the Group as at the date of this agreement and the Hermes Pledge the Group applied to its own business as at the date of this agreement and with any ordinary course amendments and evolution of those policies and principles which are in alignment with the high environmental, social and governance standards the Group applies.

Responsible Investment Principles means:

Principles derived from the United Nations Principles for Responsible Investment (UNPRI) whereby ESG Factors are incorporated by a fund manager into its investment analysis and decision-making processes; into active ownership policies and practices; into the disclosures sought from the entities into which investments are made; and are adopted in the operation and management of its own business and its engagement with the investment industry more generally.

By way of example, the Company adopts a responsible investment approach that encompasses systematic consideration of a range of non-financial factors alongside more traditional financial analysis of cash-flows and P/E ratios. It involves the incorporation of longer-term risk factors including a company's relationship with its stakeholders as well as its impact, through both its operations and the products and services it offers, on the environment and wider society. It also necessitates recognising the importance of the long-term health and stability of the markets in which it invests.

ESG Factors means:

Environmental, social and governance factors (ESG). Examples of ESG factors include (1) Environmental: climate change, greenhouse gas (GHG) emissions, resource depletion, including water, waste and pollution, deforestation (2) Social: working conditions, including slavery and child labour, local communities, including indigenous communities, conflict, health and safety, employee relations and diversity (3) Governance: executive pay, bribery and corruption, political lobbying and donations, board diversity and structure, and tax strategy. It is not possible to provide an exhaustive list of ESG factors as the implications of "non-financial" influences on long-term investment prospects continually evolves and is influenced by both industry, geography and asset class.

By way of example, in operating its business and in the management of assets on behalf of clients, the Company recognises that companies are not abstract entities but are composed of people and operate within communities. It is self-evident therefore that companies have responsibilities towards those individuals whom they employ as well as the communities in which they operate; both are rich sources of capital for a company but need to be managed with integrity. The observance of basic human and labour rights, developing the full potential and productivity of human capital and effectively combating bribery and corruption are essential for the long-term sustainability of companies and ultimately maintaining their license to operate.

In this agreement:

Affiliate means:

Agreed Form means, in relation to any documents, the form of that document which is initialled for the purposes of identification by or on behalf of each of the parties;

Anti-Corruption Policies has the meaning given in clause 17;

Appointer means, in relation to a Nominated Director, the person who appointed that Director under clause 5.1;

Associated Person means, in relation to a body corporate, a person (including an employee, agent or Subsidiary of that body corporate) who performs services for or on behalf of that body corporate;

Beneficiary means BTPS;

Board means the board of directors of the Company;

BTPS Nominated Director has the meaning given in clause 5.1(b) and shall include any alternate of that Director;

Budget means the budget for the Group for a Financial Year set under clause 8;

Business means the asset management and advisory business and stewardship business of the Company and its Affiliates conducted in a manner that is consistent with the ESG Principles, and any alternation or development of such businesses as may be approved from time to time in accordance with this agreement;

Business Day means a day other than a Saturday, Sunday or public holiday on which banks are generally open in London and New York for normal business;

Chief Executive Officer means the chief executive officer of the Group from time to time appointed in accordance with clause 6.2;

Constitution means the constitution of the Company in Agreed Form, as amended from time to time;

Control means:

and Controlled and Controlling Interest shall have a corresponding meaning;

Deed of Adherence means a deed of adherence to this agreement to be executed by any transferee of a Share substantially in the form set out in Schedule 6;

Director means a director of the Company;

Discloser has the meaning given in clause 19.4;

Dispose means, in relation to any Share:

and the term Disposal has a corresponding meaning;

Dispute means any dispute, claim, difference or controversy arising out of, relating to or having any connection with this agreement, including any dispute as to its existence, validity, interpretation, performance, breach or termination or the consequences of its nullity and any dispute relating to any non-contractual obligations arising out of or in connection with it;

Dividend includes a dividend or other distribution in kind or in cash;

Effective Date means the date on which this agreement takes effect in accordance with clause 3;

Encumbrance means a mortgage, charge (fixed or floating), pledge, lien, option, right to acquire, right of pre-emption, assignment by way of security or trust arrangement for the purpose of providing security or other security interest of any kind (including any retention arrangement), and the term Encumber has a corresponding meaning;

Equity Proportion means, in relation to a Shareholder, the total number of Shares held by that Shareholder from time to time divided by (i) the total number of Shares in issue from time to time plus (ii) where such rights entitle the holder thereof to participate in an offer of new Shares, the aggregate number of Shares in respect of which rights to subscribe have been granted or allocated (whether conditionally or unconditionally) to or for the benefit of, or reserved for, management or employees of the Group, expressed as a percentage;

ESG Principles has the meaning given in Schedule 7;

FCA means the UK Financial Conduct Authority and any successor regulatory authority from time to time;

FCA Handbook means the handbook of rules and guidance maintained by the FCA from time to time;

Federated Distribution Agreements means the distribution agreements, each of which shall be on arm's length terms, to be entered into on or after the Effective Date between the Company or other Group Companies on the one hand and members of the FII group on the other, for the distribution by members of the FII group of products and services of Group Companies;

Federated Nominated Directors has the meaning given in clause 5.1(c) and shall include any alternate of any such Director;

Financial Year means a period starting on 1 January of any year and ending on 31 December of the same year;

Government Agency means any government, any department, officer or minister of any government and any governmental, semi-governmental, administrative, regulatory, fiscal, judicial or quasi-judicial agency, authority, board, commission, tribunal or entity;

Group means the Company and its Subsidiaries from time to time and Group Company means any of them;

group means an Ultimate Holding Company and its Subsidiaries and group member has a corresponding meaning;

Hermes Distribution Agreements means the distribution agreements, each of which shall be on arm's length terms, to be entered into on or after the Effective Date between the Company or other Group Companies on the one hand and members of the FII group on the other, for the distribution by Group Companies of products and services of the FII group;

Holding Company has the meaning given in paragraph 2 below;

Independent Directors means the directors appointed in accordance with clauses 5.1(f) and 5.3;

Initial Budget means the initial budget of the Group for the 2018 Financial Year in the Agreed Form;

Insolvency Event means, in respect of any person:

Interest means, in relation to any person, any direct or indirect financial or commercial interest of that person or its Affiliates arising from any existing or proposed arrangement, contract, litigation or other proceeding between any Group Company and that person or any of its Affiliates, where such arrangement, contract, litigation or other proceeding can be reasonably considered to be material in the context of the business of the Group taken as a whole;

Loss means all losses, damages, costs, expenses, charges and other liabilities whether present or future, fixed or unascertained, actual or contingent;

Material Business Acquisition has the meaning given in paragraph 8 of Schedule 4;

Material Business Disposal has the meaning given in paragraph 9 of Schedule 4;

New LTIP has the meaning given to it in the SPA;

New Party has the meaning given in clause 14.1;

Nominated Director means a Director appointed under clause 5.1 (and includes any alternate of that Director);

Permitted Transferee means:

Put and Call Option Deed means the deed dated the same date as this agreement between BTPS, Federated and FII relating to shares in the Company;

Regulatory Capital Target Amount means the Group's required regulatory capital as determined in accordance with applicable requirements and shown in the Company's then most recent Internal Capital Adequacy Assessment Process (ICAAP) submission to the FCA, inclusive of any regulatory capital planning buffer required by the FCA, plus a discretionary safe margin buffer of capital, all as determined in good faith by the Board, in each case calculated using methodology consistent with the calculation of the Company's ICAAP for prior recent years, applicable FCA requirements, usual industry practice and past practices, and applied by the Company from time to time;

Relative means, in relation to an individual:

Relevant Date means the date on which a party becomes a party to this agreement whether as an original party or by executing a Deed of Adherence in accordance with clause 14;

Representative means, in relation to a person, any director, officer or employee of, and any accountant, auditor, financier, financial adviser, legal adviser, technical adviser or other expert adviser or consultant to, that person;

Securities means:

Senior Employee means any person employed or engaged by a Group Company who (a) holds the position of 'Director' or above; or (b) has an annual basic salary of £150,000 or more, or any person who has had such a position within the Group within the twelve months prior to the relevant time;

Share means an ordinary share in the capital of the Company;

Shareholder means a registered holder of Shares (or whose custodian or nominee is the registered holder) who is party to this agreement as an original party (being Federated and BTPS as at the date of this agreement) or by having executed a Deed of Adherence in accordance with clause 14;

Shareholder Approval means an approval given in accordance with clauses 6.3 and 6.4;

SPA means the share sale and purchase agreement entered into between BTPS and the Federated Parties relating to the sale and purchase of shares in the Company;

Subsidiary has the meaning given in paragraph 2 below;

Surviving Clauses means clause 1, clause 15.1 (for two years), clause 19, clause 21, clause 23 and clause 24;

Transaction Document means this agreement, the Constitution, the Put and Call Option Deed, the long term incentive plan to be adopted by the Company on or around the Effective Date and the SPA;

Ultimate Holding Company means a Holding Company which is not itself a Subsidiary; and

Warranties means the warranties given by the parties under clause 16.

For the purposes of this agreement:

or if it is a Subsidiary of a company that is itself a Subsidiary of that other company.

Except as otherwise expressly provided in this agreement, any provision of this agreement which requires a party to use reasonable endeavours or all reasonable endeavours, or to take all steps reasonably necessary, to procure that something is performed or occurs does not impose any obligation to:

Unless otherwise indicated, where the day on which any act, matter or thing is to be done is a day other than a Business Day, that act, matter or thing must be done on or by the next Business Day.

Where any obligation, representation, warranty or undertaking in this agreement is expressed to be made, undertaken or given by two or more parties, those parties will be taken to be severally liable in respect of it, unless this agreement expressly provides otherwise.

In this agreement:

applied as described in paragraph 17(a)(i), or under any legislation which it re‑enacts as described in paragraph 17(a)(ii);