2014 OFFER BOOKLET MAXIMUM PURCHASE SUM/NO OF BP SHARES A$ MINIMUM PURCHASE SUM/NO OF BP SHARES A$100 10

Transcription

1 2014 OFFER BOOKLET Amount Shares MAXIMUM PURCHASE SUM/NO OF BP SHARES A$ MINIMUM PURCHASE SUM/NO OF BP SHARES A$ PRICE USED TO CALCULATE ABOVE MAX/MIN # A$ June 2014 # This share price is illustrative and represents the price used to calculate the above minimum and maximum number of shares. If you participate via a purchase of shares, the number of shares purchased on your behalf will be based upon the average market price used to purchase shares for all employees after the close of the offer, taking into account transaction costs and averaged ANZ Bank exchange rates. This may be a different price to that stated above. YOUR LETTER OF OFFER Message from Andy Holmes OFFER OPENING DATE: 01 July 2014 I am pleased to inform you that the directors have resolved to make an offer in 2014 (the "2014 offer") to eligible employees under the BP Australia Employee Share Plan ("the Plan"). The Plan gives you the opportunity to acquire an interest in BP p.l.c. ("BP ") and to be more closely involved in the performance of BP and its subsidiaries worldwide including the BP Group in Australia. As you are aware, the Plan is an important component of our reward package and reflects BP s aim of encouraging employees at all levels to become shareholders in BP. You can choose how much to invest up to the annual opportunity limit and, for every share you buy, BP matches your investment with another share. Comprehensive 2014 offer information, including the terms and conditions of the Plan, is available below. Instructions on how to participate on-line are available on the BP Australia intranet site. Eligible employees should visit the BP Australia intranet site to access these participation instructions. This link will take you there: Offer Our 2014 offer will open on Tuesday 01 July 2014 and close at 4pm AEST on Monday 21 July The 2014 offer limit for Australia has been set at $3, Eligibility The offer to participate in the 2014 BP Australia Employee Share Plan is open to eligible employees employed by BP Australia Pty Ltd, BP Refinery (Bulwer Island) Pty Ltd, BP Refinery (Kwinana) Pty Ltd and BP Developments Australia Pty Ltd. Permanent full time and part time employees of participating companies on the closing day of the offer are eligible. However employees who have given, or received, notice of termination by reason of dismissal, resignation, retrenchment or retirement from their employing company, in writing, on or prior to 30 June 2014 are not eligible to participate in the offer. Page 1 of 12

2 How to apply Again in 2014 employees will be given the opportunity to accept the offer electronically via the BP intranet or the internet. Accepting electronically will assist you with tracking your application and receiving electronic confirmation of your payment. Further details on this and specific details of the offer will be communicated by and on the intranet closer to the offer date. If necessary, you will also be able to request a printed copy of the forms from the HR Operations team. Information on Investment Shares BP shares, which you contribute to the Plan by one of the methods set out in the 2014 Offer Booklet, are referred to as Investment Shares. Investment Shares under the Plan are held on your behalf by BP Australia Employee Share Plan Pty Ltd, a company the sole function of which is to act as Trustee of the Plan. The exact price of the Investment Shares acquired under the cash contribution or top-up alternatives will not be determined until after the closing date of the 2014 offer when the shares will be purchased on the London Stock Exchange at the prevailing market price of BP shares. The price (including applicable transaction costs) is calculated as an average across all purchases under the 2014 offer. The illustrative price used at the beginning of this Letter of Offer is based on the share price as at the close of business on 24 June 2014 on the London Stock Exchange. The illustrative example assumes that all Investment Shares were acquired on 24 June 2014 and the exchange rate used to determine the Australian dollar amount is that provided by the ANZ Bank at that date. Consistent with current practice, the market price of BP Shares (and the Australian dollar equivalent) will continue to be updated daily and displayed on the intranet. If you wish, you may also find out the current market price (and the Australian dollar equivalent) for BP Shares by contacting the Share Plan Administrator. During the offer period, the Share Plan Administrator will also, on request, provide an updated estimate of the price per share under the Plan based on the market price in effect at the date of your request. The contact numbers for the Share Plan Administrator are: Phone or Fax (03) In Summary Our share plans are "share matching" plans. This means that for every BP share you purchase (investment shares) within the limits of the offer, the company will match your investment with the same number of BP shares (matching shares). The shares are held in Trust with the investment shares being restricted for two years and the matching shares for three years. Any BP shares which you may hold in the plan which are not restricted may be rolled over and used as investment shares for the purposes of the plan offer. Andy Holmes President, BP Australasia 24 June 2014 Page 2 of 12

3 The Share Offer Who manages the Plan? Senior Management in Australia sponsors the Plan for Plan participants. The Share Plan Administrator at Link Market Services Limited centrally coordinates the Plan in conjunction with nominated BP employees across Australia. The BP shares in the Plan will be held on your behalf by BP Australia Employee Share Plan Pty Ltd. This company is a corporate trustee, the sole function of which is to act as Plan Trustee of the BP Australia Employee Share Plan Trust, and it will be the registered holder of your BP shares. Arrangements have been made by the Plan Trustee to ensure that any dividends, annual reports and other shareholder documentation are forwarded to participants. The Plan's formal terms and conditions are set out in the Trust Deed establishing the Plan, a copy of which is available without charge from the Share Plan Administrator. What is an Employee Share Plan? An employee share plan (ESP) very simply is a convenient method to enable employees of a company to purchase an interest in, and become part owners of, the company for which they work. Employees don't have to participate in an ESP. However, participation provides a chance for employees to play an even more significant part in the future of the company for which they work. Apart from the fact that employees who participate in an ESP gain a greater stake in their company, plans such as these are now recognised in Australia as an important part of employee working conditions and benefits offered by some companies. Shares held on your behalf by the Plan Trustee Shares held by the Plan Trustee fall into three categories: Investment Shares, Additional Shares and Surplus Shares. These three categories are described more fully below. Investment Shares Investment Shares are those shares which you contribute to the Plan. These shares will be registered in the name of the Plan Trustee, who will hold them on your behalf. Investment Shares may be contributed to the Plan in three different ways: a) Cash Contribution - in which case the Plan Trustee will purchase the Investment Shares using your cash contribution; b) Transferring BP shares already owned by you to the Plan Trustee - in which case the shares will be held by the Plan Trustee as Investment Shares on your behalf; or c) Rolling over Surplus Shares. If you participate via method b) or c) and the amount of shares available to transfer is less than the maximum offered, you can elect to top up the difference. Please note that if you contribute cash (option a), you cannot also transfer shares (option b) or rollover shares (option c). However you can combine a transfer (option b) and a rollover (option c) and, if you wish, top up the difference. These methods of contributing shares to the Plan are discussed in greater detail in the section below on "Accepting the Offer". Page 3 of 12

4 Investment Shares are subject to a two-year "retention period" (that is, they must continue to be held by the Plan Trustee for a minimum period of two years) unless you leave the BP Group (see the section below on "Leaving the BP Group"). During the retention period, you will still be eligible for dividend payments and other benefits offered to BP shareholders, such as voting rights (which may be exercised through the Plan Trustee), the right to participate in rights or bonus share issues offered by BP (once again, through the Plan Trustee), and the right to receive all information provided by BP to its shareholders. Once the two-year retention period expires, the shares become Surplus Shares and may be dealt with as described in the section below on "Surplus Shares". Additional Shares For each Investment Share contributed by you to the Plan in the year, your employer company will provide the Plan Trustee with funds to acquire one additional BP share. These shares are called "Additional Shares" under the Plan. Additional Shares will be registered in the name of the Plan Trustee who will hold them on your behalf. These shares are acquired and held for you at no cost to you whatsoever (subject to the taxation consequences set out below). Additional Shares are subject to a three-year retention period (that is, they must continue to be held by the Plan Trustee for a minimum period of three years) unless you leave the BP Group (see the section below on "Leaving the BP Group"). As with Investment Shares, during the three-year retention period, you will still be eligible for dividend payments and other benefits offered to BP shareholders, such as voting rights (which may be exercised through the Plan Trustee), the right to participate in rights or bonus share issues offered by BP (once again, through the Plan Trustee), and the right to receive all information provided by BP to its shareholders. After the three-year retention period for Additional Shares expires, the shares become Surplus Shares and may be dealt with as described in the section below on "Surplus Shares". Forfeiture of Additional Shares Since 2009, in certain circumstances the Additional Shares granted to you under the offer will be forfeited. Forfeiture means that the Additional Shares will be surrendered to the company without you receiving any payment or other compensation. Forfeiture will occur if between the date you accept an offer under the Plan and 31 December 2014: you resign from the BP Group your employment is terminated by the BP Group company with cause, or by reason of a failure to meet performance objectives in connection with your employment you commit an act which brings a BP Group company into disrepute you commit any act of fraud or defalcation in relation to the affairs of the BP Group Surplus Shares Surplus Shares are shares held by the Plan Trustee, which are not (or are no longer) subject to a retention period. Since Surplus Shares are not restricted, you may, at any time, direct the Plan Trustee to transfer the shares to you or sell the shares on a stock exchange. (Selling BP shares through the Plan Trustee is described further below in the section on "Selling BP Shares"). Alternatively, you may simply leave the shares in the Plan, in which case they will be treated as Surplus Shares. Page 4 of 12

5 If you elect to have the Plan Trustee transfer Surplus Shares into your name, you will receive a share certificate for those shares from BP, and the shares will cease to be held within the Plan. Once you receive the share certificate, you are free to deal with the shares as you choose, however if you wish to sell your shares held outside of the Plan you will need to engage your own stock broker to execute the sale on your behalf. Surplus Shares may also be "rolled over" to become Investment Shares in a future offer, which attract an equivalent number of free Additional Shares. The rollover option is described further in the section below on "Accepting the Offer". Accepting the Offer The most convenient way to accept the offer is electronically via the Link Market Service website. Instructions on how to do this are contained in the how to apply on-line instruction sheet. Accepting electronically will assist you with tracking your application and receiving electronic confirmation of your payment. When accepting electronically, any applicable payment must be made by utilising BPAY. If you don t already utilise the BPAY facility you can access this service by registering for phone or internet banking via your financial institution. If necessary, you will be able to request hard copy application forms from the HR Operations team via hroperations2@se1.bp.com or phone Note: Employees who commence employment with a participating company on or after 15 July 2014 will need to request the relevant form from HR Operations in order to participate in the Plan. Whether applying online or using hard copy forms, employees who choose to transfer shares into the Plan MUST send the completed Stock Transfer Form to the Share Plan Administrator (prior to the closing date of the offer). The online system will also prompt you to complete this step. Your completed acceptance, either online or hard copy forms, and any additional paperwork or required funds, must reach the Share Plan Administrator, Link Market Services Limited, by 4.00 p m Australian Eastern Standard Time on Monday 21July It is important to note that unless you are accepting by a Surplus Share rollover it is not sufficient to simply accept on-line. If your BPAY payment (in the case of a Cash Contribution and Top Up) or other documentation (in the case of a Share Transfer) is not received by this date and time you will be deemed to have withdrawn your acceptance to participate in the 2014 offer. NOTE: Applications, payments and forms received after 4:00 pm Australian Eastern Daylight Time on 21 July 2014 will NOT be accepted. As part of your acceptance, you are required to contribute Investment Shares to the Plan. As indicated above, these Investment Shares represent your contribution to your participation in the Plan and may be contributed in three ways: Cash Contribution or Transferring Shares into the Plan and/or rolling-over Surplus Shares. These three methods are described below. a) Cash Contribution If you wish the Plan Trustee to purchase BP Shares for you, you must pay the Purchase Sum by cheque or BPAY to the Plan Trustee. The Purchase Sum must not be less than $100 and not more than $3,400 and in $50 denominations (e.g. $550, $1000 etc.). The Plan Trustee will use that money to purchase the maximum number of BP Shares possible, up to the stated maximum as specified in the accompanying Letter of Offer. The cost of the shares to you will be averaged on the basis of the acquisition costs of all such shares acquired for all participating employees. Any transaction costs incurred by the Plan Page 5 of 12

6 Trustee will be deducted from the Purchase Sum. This is usually no more than 1.05% of the total price of the Investment Shares. In the event that your cash contribution would allow the Plan Trustee to purchase more than the maximum number of shares, the Plan Trustee will purchase the maximum number and refund the balance to you. In order to accept in this manner you have two options: a) You can apply online following the instruction sheet and utilising BPAY b) You can mail or courier your cheque along with Form A to the Share Plan Administrator. You cannot send your cheque and Form A separately. Forms are available upon request from HR operations hroperations2@se1.bp.com or b) Transferring Shares If you already hold BP Shares, which are not presently in the Plan, you may transfer those shares to the Plan Trustee. These shares are deemed to be Investment Shares once they are registered in the name of the Plan Trustee. The maximum and minimum numbers of BP Shares that can be transferred are indicated on page 1. In order to accept in this manner you have two options: a) You can apply online following the instruction sheet. When choosing to apply online you will be asked to mail or courier your Stock Transfer Form and share certificate(s) all together to the Share Plan Administrator. b) You can complete Form B and a Stock Transfer Form and forward them with your share certificate(s) to the Share Plan Administrator. Forms are available upon request from HR operations hroperations2@se1.bp.com or c) Surplus Share Rollover If the Plan Trustee presently holds Surplus Shares on your behalf (or if the Plan Trustee presently holds shares on your behalf that will be Surplus Shares by the closing date of this offer), you may direct the Plan Trustee to rollover some or all of those Surplus Shares to become Investment Shares in the 2014 offer. The maximum and minimum numbers of Surplus Shares that can be rolled over are indicated on page 1. If you wish to accept in this manner you have two options: a) You can apply online following the instruction sheet. b) You can complete the Rollover Form and forward with your completed Form B application to the Share Plan Administrator by mail, fax or (scanned copies). Please ensure both forms are sent together. Forms are available upon request from HR operations hroperations2@se1.bp.com or d) Top-up Option Should your total Surplus Shares available to rollover or any shares available to transfer into the Plan be less than the maximum number of shares allowed in the 2014 offer, the difference can be made up through the top-up facility. Top-up Shares will be purchased outside the Plan on your behalf by the Plan Trustee and transferred into the Plan to become Investment Shares in the 2014 offer. Once the purchase has been made, the Share Plan Administrator will advise you via of the total cost of your Top-up Shares and provide you with a BPAY reference number to make payment. You must then pay for your Top-up Shares via BPAY within 5 business days of receiving the from the Share Plan Page 6 of 12

7 Administrator. Alternatively, you can send a cheque to the Share Plan Administrator which must be received within 5 days of receiving the requesting payment. If you wish to Top-up your Surplus Share Rollover and/or Share Transfer into the Plan you have two options: a) You can apply online following the how to apply on-line instruction sheet, indicating you wish to rollover and/or transfer and top-up. If utilising the share transfer option with a top-up when choosing to apply online you will be asked to mail or courier your Stock Transfer Form and share certificate(s) all together to the Share Plan Administrator. If these documents are not received by the closing date and time, you will be deemed to have withdrawn your acceptance to participate in the 2014 offer. b) You can print and complete Form B, a Rollover Form and/or Stock Transfer Form and the Top-Up Form and forward, along with your share certificate(s) in the case of a share transfer, to the Share Plan Administrator by mail or courier. In the case of a rollover and top-up, the forms may be sent by fax or (scanned copies). Please ensure all documents are sent together. If these documents are not received by the closing date and time, you will be deemed to have withdrawn your acceptance to participate in the 2014 offer. Forms are available upon request from HR operations hroperations2@se1.bp.com or Advice from the Administrator If applying online you will immediately receive a receipt number for your transaction, which you are encouraged to print out and keep for your records as you will not receive any further acknowledgement. In the case of a Cash Contribution, you must make your BPAY payment by the closing date and time or you will be deemed to have withdrawn your acceptance to participate in the 2014 offer. In the case of a Share Transfer, you must send other documentation to the Share Plan Administrator by the closing date and time or you will be deemed to have withdrawn your acceptance to participate in the 2014 offer. Upon receipt of paper based applications (forms available from HR Operations), the Share Plan Administrator will forward an acknowledgement within 48 hours of receipt. If you do not receive an acknowledgement from the Share Plan Administrator, please follow up via or telephone. Within four weeks after the close of the 2014 offer, you will receive confirmation that your application has been accepted and the number of BP Shares held on your behalf by the Plan Trustee will be detailed. You will be eligible to receive any dividends declared by BP on all shares held on your behalf by the Plan Trustee. You will be advised of your individual dividend payment when any dividend is paid. Dividend Reinvestment Dividends on all shares held on your behalf under the Plan are paid to you either by direct credit into your nominated bank/credit union account or alternatively, you can direct the Plan Trustee to use your dividend payments to purchase BP shares. The Plan Trustee will purchase those shares on a stock market at the market price prevailing at that time. The shares will then be registered in the name of the Plan Trustee, who will hold the shares on your behalf pursuant to the terms of the Plan. These shares will be treated as Surplus Shares. As with any Surplus Shares, you may at any time direct the Plan Trustee to transfer them into your name or sell them on your behalf on the Friday following your request. You may also leave them in the Plan and later, if you wish, nominate them to be Investment Shares for the purposes of a future offer under the Plan. Page 7 of 12

8 The benefits to you are that the Plan Trustee is able to purchase BP shares at a significantly discounted brokerage, and (if you later nominate the shares to be Investment Shares) there is no transfer to the Plan Trustee as the shares are already registered in the Plan Trustee's name. Leaving the BP Group When you leave the BP Group, the Plan Trustee will forward to you a letter allowing you the option of selling or transferring your shares. If you do not respond to this letter within 14 days your shares will automatically be transferred onto a share certificate in your name and mailed to your home address on the share plan administration records. Remember, under certain circumstances (see the section above on Forfeiture of Additional Shares ), such as if you resign or are dismissed with cause between the date you accept the offer and 31 December 2014, all Additional Shares allocated to you in the 2014 offer will be forfeited. Australian Taxation and the Plan The following information is a general guide to the Australian income tax treatment of the benefits you receive through the Plan at the time of preparing this booklet (7 June 2014). The practical application of tax laws depends on the rulings, interpretations and practices adopted by the Australian Taxation Office (ATO). You should of course seek your own personal advice regarding participating in the Plan. The taxation of shares acquired under an employee share scheme is automatically deferred where the shares are at a real risk of forfeiture. The Plan is intended to be considered a "tax deferred plan". This is because the Additional Shares granted to you under the Plan will be forfeited in certain circumstances (including resignation from the company before 31 December 2014). Page 8 of 12

9 This view is based on the present understanding of how the real risk of forfeiture test will be interpreted and applied. On this basis, tax will be deferred on the Additional Shares you receive in the offer and will not become payable until the tax year in which the 3 year retention period that applies for Additional Shares ends (year ending 30th June 2018), or at the time of cessation of employment, if earlier (the deferred taxing point ). Subject to your Additional Shares not being forfeited, after the retention period, or on ceasing employment, you are free to direct the Plan Trustee to either transfer your BP Shares to you or to sell them on your behalf. If, after the retention period, you do not direct the Plan Trustee to sell your shares or transfer them to you the shares will continue to be held by the Plan Trustee on your behalf and will be known as Surplus Shares. If you dispose of your Additional Shares within 30 days of the deferred taxing point, the market value of the shares at the time of disposal will be included in your assessable income for the relevant tax year. If you dispose of the Additional Shares more than 30 days after the deferred taxing point, the market value of the shares at the deferred taxing point will be included in your assessable income. You will be treated as having acquired those shares immediately after the deferred taxing point for their market value which will form the cost base of those shares for Australian capital gains tax ( CGT ) purposes. When the shares are ultimately disposed of, you will realise a capital gain if the capital proceeds from the disposal of the shares exceed the cost base of the shares and you will realise a capital loss if the proceeds are less than the reduced cost base of the shares. Shareholders may be eligible for the 50% CGT discount provided certain conditions are met. One such condition is that they hold their shares for at least 12-months. This ownership period will commence from the deferred taxing point. A capital loss can only be used to offset capital gains made in the same or future tax years. Example of Tax on Additional Shares Please note the figures used in this illustration are for the purposes of illustration only and the share price used may bear no resemblance to actual figures. Ann takes up the share offer on 01 July 2014 and is notified that 362 shares at $9.39 each are her Additional Shares. Ann is still employed by BP when the retention period ends in July Ann will not be assessed in respect of the Additional Shares until the end of the retention period. If Ann disposes of the shares within 30 days after the retention period ends and the shares have a market value of $10 each on the date of disposal, Ann will include $3,620 in her assessable income in her tax return for the year ending 30 June Should Ann decide to keep the Additional Shares and disposes of them more than 30 days after the end of the retention period, the market value of the shares on the 3 year expiry date will be included in her assessable income in her tax return for the year ending 30 June If the share price has risen further, she will then be assessed on any capital gain on the sale of the shares. The capital gain will be the difference between the market value of the shares at the end of the retention period and the capital proceeds received in respect of the disposal of those shares. Ann may also be entitled to apply the 50% CGT discount if she holds the shares for at least 12 months from the date the retention period ended. Investment Shares The treatment for your Investment shares is different. These shares will not be eligible for deferred taxation under the employee share scheme rules but you will only be subject to tax when you dispose of these shares. Page 9 of 12

10 Example of Tax on Investment Shares For Investment Shares you have acquired under the 2014 plan: (a) If you hold these shares for less than 12 months and then dispose of those shares, you will make a capital gain if the capital proceeds received for those shares are more than their cost base. You will make a capital loss if the proceeds are less than the reduced cost base for the shares. A capital loss can be offset against capital gains made in the same or future tax years. (b) If you hold these shares for more than 12 months and then dispose of those shares, you may be entitled to apply the 50% CGT discount to any capital gain that you realise as a result of the disposal. If you already own BP Shares and decide to transfer them to the Plan Trustee to become Investment Shares, then in particular you should seek your own advice about the tax consequences of transferring your shares and any subsequent dealings with your shares by the Trustee. If on the other hand, you contribute funds to purchase Investment Shares, the Plan Trustee will purchase those shares at their market price on your behalf. You are not required to include an amount in your assessable income in the year in which the retention period expires for your Investment Shares. If you direct the plan Trustee to sell the shares on your behalf, this will be treated in the same manner as if you had made a sale yourself and may give rise to a taxable capital gain. We recommend that you seek your own independent professional tax advice in respect of any dealings with Investment Shares or other BP Shares that become Investment Shares. Surplus Shares When the retention periods for Investment Shares and Additional Shares expire and the shares remain in the Plan, they become unrestricted Surplus Shares. The tax consequences in respect of Investment Shares remain applicable for Surplus Shares. Disclaimer and Warning Due to the complexities surrounding the calculation of possible capital gains/losses made upon the sale of your BP Shares, it is recommended that you seek your own professional advice prior to the sale of your BP Shares. It is important to note the above guidance applies to taxpayers who hold their shares on capital account and not part of a share trading business. Dividends Dividend income is regarded as ordinary income in your hands and you will be assessed on such income at your normal marginal rate of tax. All dividends received should be declared in your income tax return and records of dividends maintained. In extraordinary circumstances, BP reserves the right to withhold dividends. Dividend Reinvestment The Plan Trustee provides a facility to enable shareholders to participate in a dividend reinvestment arrangement. Under this arrangement, you can nominate to the Plan Trustee that you want the cash component of your dividend reinvested in new shares, which will be held by the Trustee on your behalf and known as Surplus Shares. As Surplus Shares are not subject to any restrictions, you can direct the Trustee to either transfer the shares into your name or sell Page 10 of 12

11 the shares to other parties. Where the shares are sold to other parties, you may realise a taxable capital gain. The general CGT impacts are dealt with above. You will still be subject to tax in Australia on the dividend even though you receive shares, not cash. Where you elect to reinvest your dividend, you may not have cash available immediately to meet any Australian tax liability you may have. In extraordinary circumstances, BP reserves the right to withhold dividends. Withholding Tax Currently, dividends received by participants of the BP Australia Share Plan carry a UK foreign tax credit of 10/90ths of the dividend (i.e. equal to the tax withheld on the gross dividend). This tax credit is available in most circumstances to reduce the Australian tax paid on the dividend. The current position for a participant receiving a $90 dividend and who is on a 37%marginal tax rate (and not taking the Medicare levy into account), is illustrated as follows:- Dividend received $90 Tax credit (10/90ths) $10 Assessable dividend $100 Prima facie Australian tax ($37) (Less credit for withholding tax) $10 Actual Australian Tax $27 After tax amount received $63 Selling BP Shares It is a condition of your participation that you cannot sell or transfer your BP shares until the expiry of the applicable retention period. After the expiry of the applicable retention period, you are free to direct the Plan Trustee to sell the BP shares or transfer them directly to you. If you direct the Plan Trustee to sell, the Plan Trustee will dispose of the BP shares on the Friday following receipt of the instruction to sell, and forward the net proceeds to you soon after. Will there be further Offers of Participation in the Plan? It is the present intention to offer participation under the Plan annually. Under the Trust Deed, no more than one offer may be made in any financial year. Any future offers however, are wholly discretionary and will depend on the future performance of BP in Australia and the BP Group as a whole. BP in Australia hopes that you will take this opportunity to consider participating in the Plan in However, if you decide not to accept the offer in 2014 you may still participate under any future offer provided you are eligible at the time. Do Participants receive a Share Certificate? You will be mailed an acknowledgment of participation in the Plan as soon as practicable after accepting the 2014 offer. An official share certificate will only be forwarded to you if Surplus Shares held on your behalf by the Plan Trustee under the Plan are transferred to you. Page 11 of 12

12 Official share certificates are valuable documents and should be kept in a safe place. A share certificate issued in your name is evidence that you are a shareholder, or part owner, of BP. Any statement made by BP relating to the Plan is intended to constitute general information only. All employees should, prior to accepting the offer under the Plan, consider seeking their own professional advice from an independent person licensed by the Australian Securities and Investments Commission to provide financial product advice. Page 12 of 12