Subject to your annual re-election as a director and satisfactory performance by you of your dutiesas a non-executive director, the appointment may be continued after 31 January 2012 if you and theBoard agree.**Time commitment**You are expected to attend all meetings of the Board and those Board Committees to which you areappointed, the Annual General Meeting and one or more Board away days. If you cannot attend anymeeting you should advise the Secretary in advance. In addition, you will be expected to devoteappropriate preparation time ahead of each Board and Board Committee meeting and to take part in atleast one visit each year to one of BT’s offices or other sites. It is difficult to be preciseabout the amount of time you should expect to spend on this work, but we estimate that you shouldallow a minimum of 22 days each year, subject to Committee commitments. Additional time commitmentmay also be required if the Company is undergoing a period of particularly increased activity (suchas a major acquisition or capital transaction).By accepting this letter, you are confirming that you are able to allocate sufficient time to meetwhat is expected of you in your role as a non-executive director. The agreement of the Chairmanshould be sought before accepting additional commitments that might affect the time you are able todevote to your role as a non-executive director of the Company.**Role**Non-executive directors have the same general legal responsibilities to the Company as any otherdirector. The Board’s principal focus is the strategic direction, development and control of thegroup, while maintaining sound risk management and internal control systems. In support of this itapproves the group’s values, ethics, business practice policies, strategic plans, annual budgetsand the group’s overall system of internal controls, governance and compliance authorities. Italso has oversight and control of the group’s operating and financial performance. Board membersare expected to constructively challenge and help develop proposals on strategy. Theseresponsibilities are set out in the formal statement of the Board’s role which you receivedpreviously in your directors’ briefing pack and are in accordance with the UK Corporate GovernanceCode.
 

 
**Fees and expenses**You will, from 1 January 2011, receive fees for your services as a director of £62,000 a year,£30,000 as a member and Chair of the Audit & Risk Committee, £7,500 as a member of the Nominating &Governance Committee, £5,000 as a member of the Pension Scheme Performance Review Group and £5,000as a member of the Committee for Sustainable and Responsible Business.Your total fees per annum are therefore £109,500.The Company will either pay or reimburse you for all travelling, hotel and other expenses incurredon the Company’s business.**Outside interests**It is accepted and acknowledged that you have business interests other than those of the Companyand have declared any conflicts that are apparent at present. In the event that you become awareof any potential conflicts of interest this must be disclosed to the Secretary as soon as itbecomes apparent. You will be asked to review the interests notified, on an annual basis. However,any new interests which arise during your period of appointment should be notified to the Secretaryas soon as possible.**Confidentiality and share dealings**All information acquired during your appointment is confidential to the Company and should not bereleased (by whatever means), either during your appointment or following termination, to thirdparties without prior clearance from the Secretary. You also undertake to keep secure anyinformation and material sent to you.Your attention is also drawn to the requirements under both legislation and regulation as to thehandling and disclosure of price sensitive information. You should avoid making any statementsthat might breach these requirements without prior clearance from the Secretary.You will be bound by BT Group plc’s Articles of Association and by the Company’s share dealingcode.
 

 
**Induction and Briefings**The Company has in place arrangements to complement the briefing material you have already receivedabout the BT group through an on-going programme to keep you informed about the Company’sbusinesses, activities and developments, the communications industry and the regulatoryenvironment. This can include meetings with the Company’s executive management, major shareholdersand other stakeholders, and the external auditors. We will also continue to arrange a tailoredpackage of visits to business locations so you can see BT and its people at work.**Review**The performance of the Board and its committees is evaluated annually. If, in the interim, thereare any matters which cause you concern about your role you should discuss them with the Chairmanor the Secretary as soon as is appropriate.Individual training and development needs will be regularly reviewed and agreed with each directoras part of the Board evaluation process.**Insurance**You are covered by the Company’s directors’ and officers’ liability insurance. The current limitin respect of any one claim or all claims in aggregate during the period of the insurance policy is£170 million.**Independent professional advice**The Company has a procedure for its directors, in furtherance of their duties, to take independentadvice if necessary, at the Company’s expense. If you feel it necessary to seek such advice,please contact the Secretary first. A copy of the procedure was included in your briefing pack.**Termination**Upon termination of your appointment you will, at the Company’s request, promptly resign in writingas a director of BT Group plc. The Secretary is irrevocably authorised to sign a letter ofresignation on your behalf if you fail to do so.
 

 
**Acceptance**Please confirm your acceptance of these terms by signing and returning the attached copy of thisletter.Yours sincerely/s/ Andrew ParkerName: Andrew ParkerANDREW PARKERTo: Andrew ParkerCompany Secretary I confirm acceptance of the above terms of appointment.      /s/ Phil Hodkinson 16 March 2011Name: Phil Hodkinson Date